28 August, 2014

Proposed Australian Copyright Law Changes - Copyright Infringement Challenged

Copyright seems to be going through some growing pains in the last few years, with extensive changes happening all over the world in the area. This has not been left out in the discussions of this blog, where copyright reform has been quite extensively covered in Ireland, Australia and the United Kingdom. As has been said by myself and others copyright needs this change, and updates have been warranted for some years. Arguably our neighbors in the Southern Hemisphere have been ahead of their UK counterparts for some time, at least in relation to copyright, with the introduction of the Copyright Amendment Act 2006, which amended the Australian Copyright Act 1968. Yet this didn't seem to be enough for the Aussies, and recently new changes to the 1968 Act have been brought up, flaring up opinions on both sides of the spectrum especially since the changes pertain largely to infringement. 

The proposed update to the current legislative scheme were introduced in a discussion paper titled "Online Copyright Infringement", commissioned by the Australian government, which was published last month. As presented by the paper itself: "[t]his paper outlines the Government’s proposed approach to amending the Copyright Act 1968 to provide a legal framework within which rights holders, ISPs and consumer representatives can develop flexible, fair and workable approaches to reducing online copyright infringement". Prima facie the paper does have a point, with millions of Australians accessing torrenting sites on an almost regular basis; however the issue isn't necessarily that one-sided and straightforward. This writer shall endeavor to discuss the proposed changes and whether the measures called for are appropriate for the current IP environment in Australia, which from just looking at things as a whole is quite complicated.

Extended Authorization Liability

The first proposed change is extended liability for the authorization of copyright infringement. What this is, in simple terms, is the allowance of copyright infringement through one's services more relevant to ISPs and websites. Authorization of infringement was the subject of a heated legal battle in the Roadshow Films Pty Ltd v iiNet Ltd case (discussed more extensively on this very blog over a year ago) - the very example discussed in the paper as well. Currently this is covered by section 36 of the Copyright Act 1968, which provides that certain factors have to be taken into account when assessing authorization under the Act: the party's power to prevent the infringement; the nature of the relationship between that party and the infringing party; and whether that party took any reasonable steps to prevent the infringement. Even though one can argue that the provisions is quite great in balancing blatant authorization vis-a-vis lesser forms of potential authorization such as the mere provision of services or the scope of measures which would have to be employed to fully prevent infringement, the provision can fall flat in the vastness of the Internet. The paper discusses this and states that "[e]xtending authorisation liability is essential to ensuring the existence of an effective legal framework that encourages industry cooperation and functions as originally intended, and is consistent with Australia’s international obligations"

How this is proposed to be done is by having the courts assess authorization by looking at the relationship between the parties, and whether the potentially authorizing party took any reasonable steps to prevent the infringement. The reasonable steps the party took would be gauged through certain factors: "(a) the extent (if any) of the person’s power to prevent the doing of the act concerned; (b) whether the person or entity was complying with any relevant industry schemes or commercial arrangements entered into by relevant parties; (c) whether the person or entity complied with any prescribed measures in the Copyright Regulations 1969; and (d) any other relevant factors". This change puts the onus quite heavily on the 'authorizing' party, in other words, potentially places ISPs and others with an onus that is potentially very vague and strict. Increases in liability and a need for more enforcement and monitoring will undoubtedly create costs, and potentially cause disruptions and claims processes for users (both legitimately and illegitimately in some cases one can imagine), which would only have a negative impact on the average Australian consumer.

Extended Injunctive Relief to Block Infringing Overseas Sites

The second proposal put forth is the extension of rights holders' capabilities to block foreign websites which facilitate the infringement of copyright. As put forth by the paper: "[w]here online copyright infringement is occurring on a commercial scale, rights holders need an efficient mechanism to disrupt business models operated outside of Australia". The changes discussed take cues from the UK regime where under section 97A of the Copyright, Designs and Patents Act 1988 a court can block access to a service provider, i.e. a website, should an ISP have 'actual knowledge' of a person using the aforementioned service to infringe copyright. As explained by the paper "[a] similar provision in Australian law could enable rights holders to take action to block access to a website offering infringing material without the need to establish that a particular ISP has authorised an infringement".

Roo was worried over his habit of downloading the newest jams
The proposed change to the provision would impose a vague duty on ISPs for injunctive relief against websites given: "[t]he Copyright Act would be amended to enable rights holders to apply to a court for an order against ISPs to block access to an internet site operated outside Australia, the dominant purpose of which is to infringe copyright... Rights holders would be required to meet any reasonable costs associated with an ISP giving effect to an order and to indemnify the ISP against any damages claimed by a third party". On the face of it the proposed change would give third-parties more capabilities to block websites, however when compared to its UK cousin, leaves out the specification of 'actual knowledge' on the ISPs part, affording rights holders a carte blanche of injunction possibilities against potentially any website which serves the 'dominant purpose' of infringing copyright. 

Extended Safe Harbor Scheme

The final proposed change is one which provides protection for monetary damages for service providers, such as ISPs. Under section 116AA (and subsequent sections 116AC-116AF) of the Copyright Act 1968 a service provider is protected, if they fulfill the conditions set out in section 116AH, for acting as a conduit for Internet activity; for caching through an automatic process; for storing protected material in its systems or network; and for referring users to a location on the web. Even though the provision is akin to its American cousin in the Digital Millennium Copyright Act, it's still much stricter as it currently stands. 

The proposal merely wishes to extend the application of the safe harbor provision to others beyond 'carriage service providers', the wording currently used, to 'service providers', extending the scope of protection beyond just ISPs. As the paper states: "[t]he Copyright Act would be amended to extend the application of the safe harbour scheme to entities engaged in the activities set out in sections 116AC to 116AF. This would be achieved by removing the reference to carriage service provider and replacing it with a definition of ‘service provider’, being any person who engages in activities defined in sections 116AC to 116AF". This is the only change which will wholly, at least on the face of it, impact the current scheme positively rather than negatively. 

Thoughts on the Changes

The proposed alterations to the current scheme have drawn a heap of criticism from several parties. Nicolas Suzor and Alex Button-Sloan have argued that "[the changes] could include blocking peer-to-peer traffic, slowing down internet connections, passing on warnings from industry groups, and handing over subscriber details to copyright owners". In their mind the heart of the issue is not the lack of addressing copyright infringement, but "... that Australians are not being fairly treated by the copyright industries", which stems from the fact that "...Australians pay more for digital downloads, have less choice in how they can access film and television, face large delays before content is released, and much foreign content is still not available at all in Australia". This is arguably very true, and lies at the heart of the high infringement rates, as Australians are paying 50% or even more for software and other digital goods than other nations; an example which serves to illustrate what drives illegal copying. 

Mr. Suzor and Button-Sloan further state that "...the draft proposal is likely to have serious unintended consequences. It is likely to raise the price of internet access in Australia... [and] cause major uncertainty in copyright law". Arguably this is true, as was discussed above, the buck for extra enforcement and monitoring will be passed onto the consumer. One final thought the gentlemen provide is that consumers have been left out the debate; a debate which potentially impacts them in a drastic way. 

Overall the proposed changes are quite rights holder heavy, and showcase somewhat of a one-sided approach to the issue if infringement. What needs to be addressed is the pure and unadulterated heavy pricing of our Southern Hemisphere friends, especially in a time when the digital distribution of content is practically free for software companies. Physical media will incur more costs due to the distance it needs to be shipped, storage costs and so forth, but in a world where media is shifting to an intangible form, this pricing is nothing short of a money-grab. How the proposal is finally implemented, if at all, remains to be seen; however this writer for one hopes the Australian legislature will think long and hard about the implications to the average Australian it may cause.

Source: TechDirt

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