Performers’ Protection Amendment Bill: workshop on intellectual property

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Trade and Industry

07 February 2017
Chairperson: Mr A Williams (ANC) (Acting)
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Meeting Summary

The Department of Trade and Industry (DTI) held a workshop on key concepts of intellectual property and the Performers’ Protection Amendment Bill so that the Committee could gain a broad understanding of intellectual property in all its forms. Intellectual property was one of the most contentious issues in the legal and economic spheres. South Africa’s position was that intellectual property in terms of the TRIPS Agreement should be applied in a balanced manner for the benefit of producers, users and consumers. The workshop also covered patents, trademarks, designs, copyright, Performers’  protection and geographical indications. DTI felt that intellectual property was cross cutting and needed to be administered in a well coordinated manner. On indigenous knowledge trade secrets, there was a need for departments and committees in Parliament to work in concert because international stakeholders might exploit the lack of coordination. Impact assessments of the treaties had been done and DTI supported ratification of all intellectual property treaties. There was a need to designate intellectual property as a sector.

DTI also provided a Guide To Key Concepts In Copyright And Related Rights booklet which contained explanations and definitions of these terms: Audio Visual; Beijing Treaty; Broadcasting; Cinematographic Work; Copyright Management Information; Collecting Society; Economic Rights; Fair dealings and uses; Fixation; intellectual property Tribunal; Marrakesh Treaty; Mechanical Rights; Meta Data; Moral rights; Needle-time; Novate/Novation; Orphan Work; Reciprocity of Needle-time; Reproduction; Resale of royalty right;; Royalties; Technological protection measure; WIPO Copyright Treaty (WCT); WIPO Performances and Phonograms Treaty.

South Africa was a member of Paris Convention for the Protection of Industrial Property which was a patent treaty, was not a member of the Madrid Agreement and Protocol: for the international registration of marks nor of the Nice Agreement, which provided for the classification of goods and services for the purposes of registering trademarks and service marks. South Africa was not a member of the Marrakesh Treaty but was a member of the Berne Convention. South Africa was not a member of the WIPO Performances and Phonogram Treaty (WPPT) nor was it a member of the Beijing Treaty on Audiovisual Performances (BTAP) or of the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations.

Members said the Bill would help maintain the industry but a legal expert had said the copyright law was badly formulated and the drafting was very poor which was concerning; noted concern that there were millions of rands due to performers such as that mentioned under ‘orphan work’; and that the amount of time the Programme Committee had allocated to processing the Bill was inadequate. Members said it was clear from deliberations on the Indigenous Knowledge Systems Bill that indigenous knowledge and intellectual property could not co-exist therefore questioned if DTI was happy that what they were trying to achieve would enhance intellectual property and not be in conflict with other legislation. Members said the Act appeared to have elements ‘cross cutting’ into the ambit of other departments like that of Department of Arts and Culture. Did DTI have a working relationship with departments to ensure these departments made input into the Bill before the public participation programs phase. Members asked why the Treaty was not signed because royalties would have been lost by performers. If South Africa should now sign, would it be able to recoup lost royalties? Members also asked if other forms of IP other than patents had life spans and what their terms were; why South Africa had not signed the international agreements; if South Africa would run into problems if it did not become a signatory to the agreements before it processed the Bill; who determined who was part of the collecting societies and did these societies have a constitution?
 

Meeting report

Mr Lionel October, DTI Director General, said that intellectual property was one of the most contentious issues in the legal and economic spheres. Intellectual property was there to give protection to the property rights of creators and the investment made therein. However, he said that giving protection also created monopolies. South Africa was governed by the Trade Related Aspects of Intellectual Property (TRIPS) Agreement since 1994

Mr MacDonald Netshitenzhe, Acting Deputy Director-General: Consumer and Corporate Regulation Division (CCRD) of DTI, said intellectual property was the work of the mind and was territorial in that one needed to register in each jurisdiction. South Africa was governed by the TRIPS Agreement since 1994, which was administered by the World Trade Organisation (WTO), which was not a United Nations agency. The TRIPS Agreement was a minimum standards agreement.

The World Intellectual Property Organisation (WIPO), which was a United Nations agency, administered the other IP treaties. Developing countries were demanding a development agenda at both institutions but the WTO was not willing to do so. Developing countries, sometimes joined these treaties without conducting impact assessments.

He moved on to discuss the different types of intellectual property, noting that intellectual property in terms of the TRIPS Agreement should be applied in a balanced manner for the benefit of both producers, users and consumers:

• Patents: A patent was a statutory monopoly granted by the Patent Office on behalf of the State which allowed the proprietor of the patent to stop others from exploiting the underlying principle of an invention. Patents had a lifespan of 20 years. South Africa was a member of the Paris Convention Patent Treaty for the Protection of Industrial Property.

The challenges faced here were that some patents were weak or frivolous, that pre-and post- grant oppositions were not practiced, that South Africa was not a producer of technologies, it was mainly protecting foreign patents, that human rights was not taking precedence over intellectual property, that the South African Human Rights Commission was not assisting in this regard, and that the costs for defending infringements were very high.

• Trademarks: South Africa was not a member of the Madrid Agreement and Protocol: for the international registration of marks or of the Nice Agreement, which provided for the classification of goods and services for the purposes of registering trademarks and service marks. By not joining these treaties South Africa may be disadvantaged.

• Designs: There were two types of designs that may be registered, namely an aesthetic design and a functional design. For aesthetic design, a monopoly was granted for 15 years from the date of filing at the Designs Office, and in the case of a functional design the monopoly was granted for 10 years.

The challenges were that designers and fashion designers were not utilising the design system; that incentives were given, but applicants were not registering designs.

• Copyright: Registration was not necessary for copyright to automatically exist, with the exceptions being Cinematographic Films and Videos. The duration of copyright was relatively long and the term was different for different categories of works. For literary, musical or artistic works other than photographs, the term was for the life of the author plus 50 years from the end of the year in which the author died.

Copyright treaties came with rights and obligations, so it was important to evaluate the benefits. South Africa was not a member of the Marrakesh Treaty but was a member of the Berne Convention. The challenges were that piracy/counterfeiting depleted revenues; unfair contracts with broadcasters and publishers; that Collecting Societies were still voluntary in nature and that artist resale royalty was not in the legislation, therefore artists did not receive a portion of the resale value.

• Performers’ Protection: There were three categories of related rights namely: performers (actors, musicians and dancers), producers of phonograms and broadcasting organisations. This Act did not in any way restrict or affect the rights provided for by any other law relating to copyright in literary and artistic works. South Africa was not a member of the WIPO Performances and Phonogram Treaty (WPPT) nor was it a member of the Beijing Treaty on Audiovisual Performances (BTAP) or of the Rome Convention. WIPO was responsible, together with the International Labour Organisation (ILO) and the United Nations Educational, Scientific and Cultural Organisation (UNESCO), for the administration of the Rome Convention.

Challenges were that the sector was not organised for bargaining purposes; piracy/counterfeiting; unfair contracts; the non-payment of royalties and the fact that South Africa had not ratified these treaties.

• Geographical Indications (GIs) and Trade Secrets: South Africa had collective marks (owned by communities/associations) and GIs such as Rooibos and Honey bush teas. Traditional Healers used trade secrets to protect their profession. The protection of performers in audiovisual media has not yet been effectively established at international level. Singers, musicians, dancers and actors enjoyed limited international protection for their performances since the adoption of the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations in 1961. In 1996, the adoption of WIPO Performances and Phonograms Treaty (WPPT) fully modernized and updated these standards in respect of sound performances, particularly in relation to digital uses, leaving a void in the international rights' system for actors and other audiovisual performers. The adoption of the Beijing Treaty on Audiovisual Performances strengthened the prejudicial position of performers in the audiovisual industry by providing a clearer legal basis for the international use of audiovisual productions, both in traditional media and in digital networks. It granted performers four kinds of economic rights for their performances fixed in audiovisual fixations, such as motion pictures: (i) the right of reproduction; (ii) the right of distribution; (iii) the right of rental; and (iv) the right of making available. The Treaty also granted performers moral rights, that is, the right to claim to be identified as the performer.

In conclusion, he said intellectual property was cross cutting and needed to be administered in a well coordinated manner. On indigenous knowledge trade secrets, he said there was a need for departments and committees in Parliament to work in concert because international stakeholders might exploit the lack of coordination. Impact assessments of the treaties had been done and DTI supported ratification of all intellectual property treaties. The State should protect its own intellectual property and could license it to third parties for exploitation. There was a need to designate intellectual property as a sector.

Ms Meshendri Padayachy, Deputy Director: Intellectual Property Law and Policy, CCRD, briefed the Committee on the key concepts of intellectual property. She said there was no formal registration process for copyright and the Act had specific categories with various time durations. She said the digital aspect was being brought into the Bill. She said the Marrakesh Treaty was aimed at the visually impaired while South Africa wanted to cater for all the disabled. The key issue was that there should be accessible formats. She said the USA was not a member of the Rome or Beijing Treaties which meant that no royalties were paid to performers when their work was played in America.

She then spoke to the Guide To Key Concepts In Copyright And Related Rights booklet (see document) which contained explanations and definitions of the following terms: Audio Visual; Beijing Treaty; Broadcasting; Cinematographic Work; Copyright Management Information; Collecting Society; Economic Rights; Fair dealings and uses; Fixation; intellectual property Tribunal; Marrakesh Treaty; Mechanical Rights; Meta Data; Moral rights; Needle-time; Novate/Novation; Orphan Work; Reciprocity of Needle-time; Reproduction; Resale of royalty right;; Royalties; Technological protection measure; WIPO Copyright Treaty (WCT); WIPO Performances and Phonograms Treaty.

Discussion
Mr J Esterhuizen (IFP) said the Bill would help maintain the industry but he had canvassed comment on the Bill from an advocate who said the copyright law was badly formulated and presented. The drafting was very poor which had led Mr Esterhuizen to be concerned. He was also concerned that there were millions of rands lying around that were due to performers such as that mentioned under ‘orphan work’.
 
Mr D MacPherson (DA) said his concern was about the amount of time the Programme Committee had allocated to the Bill and where the briefing and public hearing time allocation appeared to be inadequate as the issues appeared to be complex with a need to hear from a variety of stakeholders and enough time for deliberations.

Mr N Koornhof (ANC) said he had served on the Portfolio Committee for Science and Technology which was currently dealing with the Indigenous Knowledge Amendment Act. From those deliberations, it was clear that indigenous knowledge and intellectual property could not co-exist. He therefore asked if DTI was happy that what they were trying to achieve would enhance intellectual property and not be in conflict with other legislation.

Ms S Van Schalkwyk (ANC) said the Performers’ Protection Act appeared to have elements ‘cross cutting’ into the ambit of other departments like that of Department of Arts and Culture. Did DTI have a working relationship with related departments to ensure these departments made input into the Amendment Bill before the public participation phase?

Ms P Mantashe (ANC) asked why the Treaty was not signed because royalties would have been lost by performers. If South Africa should now sign, would it be able to recoup lost royalties?

Mr A Williams (ANC) asked if other forms of IP other than patents had life spans and what their terms were. He asked for the reason South Africa had not joined the agreements. He asked if South Africa would run into problems if it did not join the agreements before the Bill was passed and whether it would be best to sign the agreements and then do the Bill. The Che Guevara image used in the presentation was owned by the Che Guevara family and was not protected worldwide. Would that be protected after the legislation was passed?

On intergovernmental coordination, Mr October replied that DTI had worked with other departments and had had intense discussions in the drafting of the Bill, as well as at Cabinet level, especially the Departments of Science and Technology, Arts and Culture and Communications. All the departments were aligned with the Bill.

On the Marrakesh Treaty, Mr Netshitenzhe replied DTI had worked with the Departments of Arts and Culture, International Relations and Science and Technology.

On ratification, Mr Netshitenzhe replied the issue was highly controversial, as only Parliament could ratify a treaty, not officials. A technical treaty could be signed by a Minister, but these treaties did not fall within that type of treaty. Assessing the pros and cons of a treaty and the ratification by Parliament would naturally lead to delays in the signing of treaties.

He said the life span of patents were 20 years, but because of weak, frivolous patents being granted the opportunity for generics was being limited. Copyright had a span of 50 years while in other countries it was even 70 years. He asked what the benefits were for the country as it seemed the country was dancing to the tune of the big companies. Trademarks were perpetual and renewable every 10 years or they would expire.

On interaction with departments, he said the State Law Advisors saw to it that there was no conflict of laws. Intellectual property fell within the domain of DTI and not for example that of Department of Science and Technology.

He replied that Ms Mantashe’s question was not within the domain of DTI to answer. DTI would propose to Parliament that the Treaty dealing with digital copies be ratified.

On ratification of treaties, Ms Padayachy replied that in terms of the WIPO, it required that the Marrakesh Treaty would come into effect only once 30 countries subscribed to it. This only occurred in October/November 2016 while the Beijing Treaty had not reached its target number of 30 subscribing countries yet. This did not stop South Africa from having parts of the treaty legislated in the Bill.

The Copyright Amendment Bill was published for consultation in July 2016 and it was acknowledged that the drafting could be improved and subsequently the two bills were separated into the Copyright Protection Bill and the Performers’  Amendment Bill.
 
The Che Guevara picture in the presentation was being used satirically and it was therefore not infringing the copyright rule.

Mr Netshitenzhe said South Africa was not keen to rush into signing treaties without having done empirical studies to determine the benefits and disadvantages to South Africa. DTI would present their arguments to the Committee but ultimately Parliament decided whether to ratify a treaty or not.

Ms Mantashe asked who determined who was part of the collecting societies. Did these societies have a constitution? She knew of a healer in the Eastern Cape that produced herb mixtures but they did not have a patent. There was a story that an international company had taken the herb mixture formula and the person had received no royalty payments.

Mr Netshitenzhe replied that the collecting societies were voluntary associations but when the concept of ‘needle time’ was introduced in 2006, collecting societies were established. Needle time was limited to certain types of performances so this Bill, together with the Copyright Amendment Bill, means that collecting societies can no longer be voluntary organisations; they should be a statutory body with a constitution, a distribution plan and be accountable to the Copyright Registrar at the Companies and Intellectual Property Commission (CIPC) and that the members of that society constitute the board. Currently there were challenges with collecting societies, some were publishers yet acting as if they owned the rights to the original work; other societies were claiming they were acting as agencies.

On the healer whose formulations were taken, he replied that companies were coming from ‘outside’ and using intellectual property to poach from the indigenous knowledge database.

The meeting was adjourned.

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