Copyright Amendment Bill: public hearings day 2

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Trade, Industry and Competition

03 August 2017
Chairperson: Ms J Fubbs (ANC)
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Meeting Summary

The Documentary Filmmakers Association (DFA) was on the whole pleased with the contents of the Bill but took issue with Clause 3 amending Section 5 and Clause 20 amending Section 21(1)(c) and proposed that they be struck from the Bill.  Discussions between the Committee and the DFA centred on the tensions between DFA members and commissioning organisations such as the SABC, regarding in particular who should hold copyright to the works produced. The DFA felt that the sale of the SABC archive was irresponsible and against public interest.

Google was also in favour of the Bill. The submission detailed Google’s techniques in reducing and stopping piracy on Google Search, Youtube, and other products. Discussion related to the technicalities around piracy and fair use. Some members felt that the South African context was not one that Google understood fully and that fair use may not be applicable in such a context. Pressed to detail if it had funded any of the other organisations that had presented, Google noted that Media Monitoring Africa had received funding from it.

The Wikimedia Foundation presented on freedom of panorama to publish pictures of artworks which are in public space. They wanted a clause added to the Bill which gave individuals the right to photograph public works. These works should cover exterior public works, as well as potentially including interior works of public art on display. Wikimedia said that the fact that it was not legal to create audio/visual content containing public art built within the last fifty years was problematic, as it illegalized post-apartheid art while allowing apartheid-era art. All Committee members that spoke on the issue were in favour of a freedom of panorama clause being included.

The Freedom of Expression Institute’s submission focused on expanding the fair use clause to cover additional forms of art. They argued that fair use was important to the creative process and expression.

Kagiso Media systematically highlighted problem sections and their recommendations. The sections of the Bill raised were 2A(3), 3(2)(a), 4, 5, 6, 8, 9, 10, 12, 20, and 21. Members agree with the observation that it would be problematic to require that the Minister of Arts and Culture determines the royalty rates due to musicians for the use of their songs.  Discussion revolved around clarifying terms and recommendations, and the extent to which parties felt fair use would be overly litigious.

The Composers, Authors and Publishers Association (CAPASSO) represented by Mr Nick Matzukis, musician and director at CAPASSO, gave an impassioned speech about the essential degree to which creatives depend on copyright to survive and create a thriving sector. He argued that all creatives were against a fair use provision that undermined their right to own the material they created. recommended that:
- Section 5(2)(a) of the Act should not be amended as it added the element of funding to the works whose copyright would be owned by the state or organisations and not the creator;
- that the concepts of fair use and fair dealing were fundamentally inconsistent and could not coexist despite the numerous discussions around this;
- a private copying levy should be introduced as a means of ensuring that content creators and authors benefited and were protected from exploitation from extensive personal use exceptions;
- orphan works did not constitute a problem for musical works unlike other copyright spheres;
- the limitations proposed in the regulation of collecting societies could result in uncertainty.
Overall, it was argued that the main problem affecting collecting societies was not the licensing of works. Instead, it was the problem of non-reporting or underreporting of usage of works by broadcasters and other users.

Overall, delegates were divided on whether a fair use clause, which grants exception to a copyright, should be considered and if so, how broad the provision should be. The DFA was in favour of a fair use clause, stating that it was useful to filmmakers, and that a provision similar to that in the USA should be used. Google stated that it would be useful for creativity and expression in South Africa and that the concerns raised were ungrounded and amounted to “fear-mongering”. The Freedom of Expression Institute was strongly in favour of a broad fair use clause being included.  Kagiso was against the fair use clause stating that it was inapplicable in SA, and that it would lead to too much litigation. CAPASSO was against fair use, ultimately arguing that it would undermine the success and livelihood of musicians and creatives. In general, disagreement about fair use centred on two key questions: 1) how broad a fair use clause could be before becoming open to abuse, and 2) whether it was appropriate in SA and in particular whether it would lead to an overwhelming amount of litigation. There was no clear outcome on these discussions. 

In the afternoon session, the South African Guild of Editors (SAGE) argued for appropriate recognition and reward for editors as they played crucial roles in the work of actors and creators.

In discussion, Members asked about the changes that could occur as a result of the Amendment Bill that would benefit music performers and producers; the need for concrete wording for proposed changes to clauses; the need for recognition of the work of editors; clarity about a private copying levy; the rationale for the proposal for an exemption of musical works from the orphan works regime; the extent to which SAGE was transformed; what the revenue generated from orphan works was used for by collecting societies; whether CAPASSO as a collecting society received support from radio stations and other broadcasters; the actual purpose served by SAGE; as well as details of musical orphan works that have been rescued.

MultiChoice and M-Net, as homegrown pay TV broadcasters, noted that they invested heavily in local film and television sector. Local content production was not only a way of creating businesses and jobs but the preservation of South African languages, history and culture was also critical. Different models existed for the production of local content – either the broadcasters would bear the risk in its entirety, or they could co-invest with other entities. In the latter case, the copyright may be shared with producers and other investors. This prompted the recommendation that the specific provisions on the contractual aspect of production should not be contained in legislation. Ongoing investment in local production required an enabling environment, and the Bill needed to create the right balance. MultiChoice and M-Net were concerned about the possibility of the Bill further worsening the position that local broadcasters have found themselves in by dis-incentivizing investment in local content and constraining the ability to use content on multiple platforms. They also made proposals on combating piracy in the industry which included extending the right of communication to public to broadcasts and programme-carrying signals; strengthening the provisions on technological protection measures; and improving the drafting that dealt with piracy. Overarching concerns were raised about vague provisions, local content regulation and broadcasting, unguided discretionary powers granted to the Minister, and other provisions that inhibit the freedom of parties to contract on mutually agreed terms. Proposed amendments were made about the royalty provisions; communication to the public; and also commissioning and amendment to section 21(1)(c).

Discussion of the MultiChoice and M-Net submission included questions about the decision of government to encrypt set top boxes to protect channels or signals from being pirated; the disadvantage facing local broadcasters by the global competition of internet streaming providers and possible regulation of this; the possibility of curbing piracy through current technological developments; clarity on the proposed retention of Section 21(1)(c); and the need to address existence of vague provisions in the Bill.

The Recording Industry of South Africa (RISA) welcomed the Department of Trade and Industry intention to ratify the WPPT treaty, in order to bring about modernization of South Africa’s Copyright Act. Ratification of the treaty was also necessary to assist RISA in entering into reciprocal agreements with other collecting societies across the world. The ratification was also necessary because the treaty gives separate exclusive ‘making available’ rights to performers and record companies.

An independent photographer proposed that the references to photographers in section 21(1)(c) should be struck out and the definition of author should be changed to conform to international standards of recognising photographers as original creators. He advocated for the recognition and reward for photographers, through the possession of copyright, as well as the need for protection of the emerging black market in the industry. He buttressed his argument on the effect of lack of copyright on photographers through five case studies.

Members of Parliament found the submission by the representative of the photographic industry enlightening and shocking at the same time, as some important concerns that promoted the exploitation of photographers and which were not addressed by the Bill were brought into the limelight. The DTI was expected to explain the role it has played in ignoring the sector, especially the petition by that industry. Other questions raised were around ownership of rights by the state; the rationale for the proposal to extend the duration of assignment of copyright from 25 to 70 years; and proposals for protection of photographers from exploitation.

Media Monitoring Africa (MMA) welcomed the new, fair and practical limitations and exceptions contained in the Bill. It recommended the ratification of the Marrakech Treaty. It pointed out that the Bill did not consider the application of copyright to digital media, and this has posed some real challenges. MMA proposed that a technology neutral approach should be adopted in defining some terms in the Bill such as computer program. It suggested that the Bill needed a ‘software upgrade’, which simply meant the use of up to date technology neutral terms. It went on to highlight problems facing the industry, including cross border violations of content stealing; definition of first point of publication; usage of content on websites registered in other countries; and this had to be dealt with by the Bill. It proposed that the provision regarding information held by the state should be removed.

MPs raised for clarity on the suggested “software upgrade” of the Bill; examples of technical terms that were inappropriately or inaccurately used in the Bill; and about the “gaps” contained in the Bill.

The Independent Music Performance Rights Association (IMPRA) highlighted the need for a more inclusive range of collecting societies, with the interest of artists as the goal. IMPRA’s mission was to champion and lead transformation in the collective management of rights to fast track economic empowerment opportunities for local music producers and performers in all provinces of South Africa and where possible to also find ways of disentangling artists from unfair contractual obligations. It was for this reason that two chambers represented both the producers and the performers.

The Cultural and Creative Industry Federation of South Africa (CCIFSA) argued for the existence of collecting societies with national footprint and with the capability of assisting every artist, irrespective of age or locality. Numerous recommendations were on the Bill. Emphasis was placed on the need for collecting societies to be regulated by the Department, through registration and monitoring of the activities of collecting societies, including the use to which revenue of orphan works were being put. CCIFSA argued for the rollover of revenue from orphan works to an established fund that would be managed by it for the benefit of struggling artists.

Discussion on these two submissions focused on the perception of both IMPRA and CCIFSA on the regulation of collecting societies and the removal of section 22B(6); as well as clarity around IMPRA’s comment on about section 22B(6) being “a great error of our time that would serve to preserve past privilege and its legacy”.

Organisations were asked to submit responses in writing on issues raised by the Committee.

Meeting report

The Chairperson commented that some submissions in the 1 August public hearing had been insulting while not offering useful alternative suggestions or constructive criticism. She urged presenters to provide useful commentary.

Documentary Filmmakers Association (DFA) submission
Mr Rehad Desai, Uhuru Productions Director and DFA Member stated that access to information would be crucial to success in the 21st century.  He felt that the law in the country was unfair and restrictive. It served to restrict creativity and critical thought.

Mr Desai explained that much of the costs of documentary filmmaking arose in accessing film archives, many of which were owned by international corporations. Filmmaking as an art was crucial to culture, reflection, and empowerment.

Mr Desai stated that the DFA was on the whole supportive of the Amendment Bill. While members of the DFA had an interest in protecting intellectual property (IP), the DFA also recognised and respected the rights of film users. As such there was a need for a balance in law which created a symbiosis between the creator and user. Filmmakers in general did not expect to monetarise and make profit from everything that they did. For example, the right to use quotation [of others’ work] was used to provide comment or criticism. This was an essential element of law that promotes freedom of speech. Copyright law must not serve the purpose of censorship.

Mr Desai provided the example of the film Miners Shot Down [which he was involved in producing]. The documents made available following the commission of inquiry into the Marikana shootings made the film possible and it became successful winning several awards. 

Mr Desai agreed with the comments made that the Bill had been poorly drafted, creating uncertainty. Amendment Bills need to reduce the complexity of the sector and thereby improve the work done by organisations such as the DFA. The principal Act needed to be updated to fit current technologies and needs.

Mr Desai discussed Clause 20 amending Section 21(1)(c) of the Act. It failed to adequately protect the interests of documentary filmmakers in owning their own material. Under the prevailing law, in the absence of a valid contract, copyright for commissioned works of film lay with the commissioning entity and not the author. This differed from other [non-film] works, where the default was that copyright vested with the author who made the creative decisions in the production of the work. The default position should be that the filmmaker has the right to contract, and only under contract would they surrender their ownership of the copyright.

Many South African filmmakers did not own any copyright in the films they produced because Section 21(1)(c) gave ownership to the commissioning party, and most films were commissioned by a funder. For example, documentaries broadcast by the SABC were “commissioned to meet the needs of a public television slot”. SABC would by default hold the copyright; commissioned films were often shown once on television, never to be seen again, because the filmmaker lacked the rights to license it to others. The public broadcaster [the SABC] should not hold educational, non-commercial and international copyrights. They do not use this licence sufficiently and this held back the industry. Restricting creators’ access to copyright undermines their ability to continue profiting from their work, reducing the market potential of South African films. The denial of copyright to filmmakers impacts their livelihoods as well as their ability to express themselves as artists.  As such the content of Section 21(1)(c) should be struck from the Bill.

Mr Desai discussed Clause 3 amending Section 5 of the Act. It was proposed in the Bill that this section be amended such that government would own the copyright to any work that is “funded by” the state. Nearly every movie made in RSA is funded, at least in part, by a state entity: through the SABC, through the National Film and Video Foundation grants of the Department of Arts and Culture, or through the Film and Television Production Incentives of the Department of Trade and Industry (DTI). Enacting the proposed change to Section 5 would thus deprive most filmmakers of the right to hold copyright. Rather, should any state entity require licence or ownership of copyright in any specific production contracted and intended for state use, a contract can be required which transfers such rights as part of the tender process. Such transfer could be structured to not affect the spirit of co-operation and rights generation for the work’s creator. The DFA thus proposed that Section 5(2) be deleted which would allow the same copyright defaults [as in non-film works] to operate for all works.

Mr Marc Schwinges, DFA Board Member, elaborated on the proposed change to Section 5 with ownership of state-funded works to be conferred on the state, which was problematic. Such a system would deter filmmakers and reduce their profits, by disallowing the rights ownership that currently exists. This would be significant in the sector as most films and especially documentaries were funded by organs of state. It would also put an end to independent and international funding as investors will not trust projects where the filmmakers themselves do not have a direct stake in the profitability of the product. He reiterated that Section 5(2) should be deleted from the Act and not included or amended as in the Bill.

Mr Desai discussed Clause 10 amending Section 12 of the Act and fair use, a legal concept which grants exception to a copyright. Fair use is useful to filmmakers, and legal provisions similar to those in the United States of America should be established in South Africa as the Bill intends. The DFA noted that the Amendment Bill did not precede the list of authorized fair use purposes by the words “such as”. This phrase would open the list to a wider interpretation, as was done in the USA and other countries. The DFA did not take a position on whether or not the Bill should include the phrase “such as” in this fashion. However, the DFA did feel that the list should be broadened to include more works. Assuming a closed list was retained, the DFA proposed two additional purposes be added to the list, both of which are permitted under US law. Specifically, the Bill should protect: a) transformative uses of works, such that the new work serves a different audience with a different purpose as the original, such as a “mash up” video; and b) non-expressive uses of works, i.e. technological uses that merely “read” or use a work in a way that does not express it to the public, such as uses through data mining, search, storage, machine-reading, and transmission.

Mr Desai elaborated that protection of transformative uses is needed to ensure that filmmakers do not have to receive permission to create new art that in no way competes in the same market as the original. Examples include the kind of mash up videos that are sometimes created through user generated content but this can also occur in the creation of non-fiction and fiction films. This standard is similar to that endorsed by the US Supreme Court. Protection of non-expressive uses is needed by filmmakers to enable them to use the technologies that make films possible in the digital age. This is the standard in the US that has led courts to uphold technological uses needed for transmission, internet search and other common uses today.

Mr Desai closed by stating that further comments had been made in written submission.

Mr D Macpherson (DA) stated that it was a disgrace how long it had taken before the national broadcaster had agreed to screen Miners Shot Down. He felt that the factor underlying the discontent of the DFA was the SABC’s attempts to control content. He commented that the DFA seemed to want the [copyright] law to deal with the SABC, rather than the SABC being dealt with itself. For example, the SABC sold its archives to the DSTV [Multichoice] monopoly - what is his view on that? Did he believe that it is correct for the filmmaker to profit wholly from a publicly funded film? Surely a public private partnership-type arrangement would be more practical than a full transfer to the creator/author?

Mr A Williams (ANC) wanted to clarify the meaning of the submission on Section 5(2). Did the DFA interpret the clause to mean that any documentary funded by the DTI would become property of the state?

Mr J Esterhuizen (IFP) felt that the fair use clause in the Amendment Bill was not practical. The reason was that musicians would not have the finances and the ability to hire lawyers and go to court to charge people who had been using their music without an appropriate licence.

Ms P Mantashe (ANC) asked the DFA to clarify what the submission had meant about Section 5(2)(a). 

The Chairperson Fubbs asked DFA to clarify what the submission meant when it was stated that creators would also be “giving up some rights.”

Mr Desai replied that authors and creators were concerned with having the rights necessary to make a living. This is what he meant by symbiosis – these rights help the sector to survive while in return it entertains, informs, educates and inspires. He added that this symbiosis requires a healthy public broadcaster.

Mr Schwinges responded to Mr Macpherson about the SABC and elaborated why DFA members wanted copyright ownership specifically from the SABC. The SABC is a state-owned entity and therefore follows the rules of the Public Finance Management Act. The SABC has used this fact to argue that it therefore falls into the default of the law as in section 21(1)(c) - a law which is twenty years old. DFA maintains that creators and authors should have ownership of their work. This legislation was antiquated and these rights should not sit with the public broadcaster. Therefore, the DFA wants to remove this default position. If the SABC wants the IP, and the artist is willing to negotiate, then the two bodies can contract this arrangement if they so wish. This is why 21(1)(c) is fundamental and must be dropped. He added that most countries do not operate under a law such as 21(1)(c).

Mr Schwinges responded on the sale of the SABC archives. The question was not 100% relevant to the forum the meeting was intended for but he stated that documentary filmmakers (and the DFA) were very concerned about the sale.

Mr Desai commented that the SABC archive is a public good that belongs to the country. The price of R500 million was a “fire sale” [far below the true value] for such a culturally important good. There should be an investigation into the sale. The British Broadcasting Corporation has categorized a large part of its archives as part of the creative commons. If film work is state-funded, the filmmaker does not qualify for incentives unless IP is owned. The DFA would like to see their works distributed freely as they so choose. Non-commercial works should not be locked up by corporations. The businesses want to reduce competition and in so doing, harm RSA’s culture, art and history. This is morally wrong. The SABC’s core business should be to serve citizens. Documentary filmmakers for the most part were more interested in spreading their work as far as possible and would need the IP to do so.

Mr Schwinges commented on Multichoice. It is essential that the rights to content be competed for by various channels. In response to Ms Mantashe, he stated that Section 5(2) was interpreted to mean ownership by the state. This interpretation of the law was advised by a lawyer and the result was that the proposals in the Bill were problematic in terms of almost all sources of government funding. This certainly applied to the DTI production incentives, an important and rare source of equity ownership for the independent production sector which made the industry competitive. Compromising this system was very problematic. Under the Bill, the DTI would by default become the owner of whatever [film’s] funding they provided. The problem in Section 5(2) arose from the wording “funded by or under the direction or control of the state”. This was problematic because just by funding something, regardless of the source, IP was “conferred” on the funder which implies it is owned by that funder. The word “direction” was problematic as it had no clear meaning. For example, the state simply putting out a request for proposals would allow it to claim it had direction in the final work. Adding the requirement that the state or entity in question had a majority influence in the direction of the work would improve the clause and disallow the state from making the [above] argument.

Mr Schwinges stated that DFA was not favour of fair use where the secondary work undermined the economic value of the original work.  That is not the intent of fair use. But what DFA was arguing was that we cannot “price out” the user of the work (for example, the DJ who wants to create a remix cannot afford the samples).

The Chairperson stated that there was no more time for the DFA but that the Committee could take further questions and submissions in writing.

Google submission
Mr Fortune Sibanda, Google Public Policy Manager, stated that much of the discussion had been misinformation about the Bill and the concepts involved. The Bill is not yet finished but the Committee was on a good path. The submission was going to prove that technology does not harm the artist.

Google has an approach to dealing with piracy. Piracy occurs when legitimate alternatives are not available. Netflix is an instructive example. Before Netflix came to the market in RSA, 90% of accounts held in South Arica were illegal accounts created using a virtual private network (VPN) combined with a South African account. As in this case, the general principle is that making the product available legally cuts off piracy. For example, when artists release on iTunes, there is a reduction in piracy. By cutting off the source of money to pirate websites you also undermine them. One needs a scalable approach to fight piracy. Sometimes people claim they have copyright when they want to stop or reduce their competition. Google is transparent in its effort to enforce copyright.

Mr Sibanda presented some figures. Google had paid $7 billion to developers on the Google platform over the period 2014-2015. $3 billion was paid to the music industry through YouTube while $2 billion had been generated for YouTube Content ID holders. There are 8 000 partners using Content ID to manage and monetarise their content. The average time taken for Google to process a Digital Millennium Copyright Act (DMCA) request is six hours. 558 million webpages had been requested to be removed in 2015, while 670 000 ads were disapproved. Overall 98% of content issues were resolved using the Content ID system. 2.8 billion illegitimate URLs had been removed from Google search results.  There were some issues with the system and copyright law but on the whole it was working and doing so on a global scale.

Mr Sibanda commented that much of the talk about the fair use clause was fear-mongering and misinformation. Fair use was not about allowing the use of IP content without pay - that is piracy. He wanted to clarify the difference between fair use and fair dealing. Fair dealing is a closed list of specific exceptions, whereas a fair use clause is an open and flexible exception to accommodate new ideas and new technologies that may develop.  Both versions can exist together under a hybrid approach, where there is a list of defined exceptions as well as an open-ended clause, to provide both certainty and flexibility.

Mr Sibanda explained the value of fair use. Fair use allows creators to depict real life, to respond to other works (for example, Trevor Noah of The Daily Show takes snippets from Fox News or CNN to comment on), or to make new creative works. It allows creators to use old content provided they are not substituting for the value of the original content. It allows people to innovate. For example, a non-commercial remix of a song would be an exception that would enrich the Bill. He provided several examples where new art had been created based on previously existing materials. He added that it is not just an American concept and that it is not an overly litigious concept that the layperson cannot understand. He closed by noting how a broader exception clause had been implemented in Canadian law.

Wikimedia submission
Mr Douglas Scott, Wikimedia South Africa president, discussed freedom of panorama (FOP). Under current SA law, one cannot take photographs of recently built works of public art. This included modern anti-apartheid art. The existing Act was the problem. He gave the example of the Gugulethu Seven memorial. Technically it was not legal to photograph this memorial and use the photograph on an informative page such as Wikipedia as the memorial was a recently-built work of public art.

Mr Scott explained that a fair use clause can help on a “page-by-page” basis [on Wikipedia] but this is legally too costly compared to simply having freedom of panorama which places such images in the commons. In SA freedom of panorama was never explicitly allowed in the law and remains a grey-area.

Freedom of panorama was invented to protect the rights of artists and is a common concept in international copyright law. The Western world has broad FOP allowing photographs in open spaces and closed public spaces of artwork. SA and much of Africa and the Middle East did not have FOP and thus were unable to share pictures of recently built public monuments which is deeply unfortunate. When asked, owners of these monuments such as municipalities often had no idea that they were supposed to grant permission for such photographs, which to most people seems intuitively non-problematic. Furthermore, they often did not have legal skills necessary to supply this permission.

Mr Scott stated that FOP would apply to all media platforms and not just Wikipedia. FOP was originally invented to protect the rights of artists selling paintings or postcards of public spaces, as owners of buildings were approaching them and demanding royalties for pictures that contained their buildings. 3D renderings now face the same problem. Painters, craftworkers, photographers, film and media, Wikipedia, and the general public have an interest in being able to take pictures in public spaces. Therefore, the Wikimedia recommendation is that an FOP clause be written into the Bill.

Mr Scott closed with Wikimedia’s recommendation that the following be added to the Bill: "Copyrights shall not be infringed by the reproduction, distribution, or by making available to the public of still or moving images including resubmissions of public works located permanently in public roads and ways or public spaces. In the case of buildings, this authorisation shall only extend to the façades, external structures, and interior public spaces thereof." He would also consider expanding this to cover all of the media types mentioned in the submission.

Mr Williams stated that he absolutely supported the FOP clause suggested by Wikimedia.

Mr Macpherson agreed with Mr Williams. He felt that Google did not understand SA and how the legal and economic context differed to that of the USA. The figures Google provided regarding fair use internationally were not relevant to the South African context. South Africans generally did not have access to capital. Rights to the content they create was their only way to raise capital.

Mr Macpherson noted that the term “fear-mongering” used by Google in the submission has arisen in a separate submission. He asked if there were closed discussions between Google and other entities that had been happening outside the open forum of the Committee. Was Google paying lobby groups to promote a particular opinion? If so, Google should please specify these groups. He also asked if the removals of copyrighted material were done following requests or if they were automatically removed? If the two billion cases [URLs] mentioned were done following requests, how had this illegitimate content passed through Google’s Content ID algorithms in the first place?

Mr Esterhuizen was concerned that universities would lose copyright of their works to the state. He added that Google itself appeared from within universities.

Mr M Kalako (ANC) agreed with the inclusion of an FOP clause and asked Google for its opinion.

Chairperson Fubbs was concerned by the possibility that someone could falsely claim that a certain work belongs to them simply to avoid it being published. Regarding fair dealing and fair use, she did not recall hearing of a hybrid approach. Where does this phrase come from?

Mr Scott stated that the legacy of colonialism as represented in apartheid-era images is problematic especially as it can survive in the public space but post-apartheid images cannot. In response to Mr Macpherson, he stated that fear-mongering was a common term that arose naturally to describe the misinformation around fair use. He gave additional detail on FOP clauses. The ideal was to have both public interior artistic works and public exterior works on display covered by an FOP clause, as was the case in several countries. Only having exterior public works under FOP was still preferable to the status quo and a ‘second prize’.

Mr Sibanda responded to Mr Macpherson, saying that unfortunately, Google did not have South African-specific figures. It is a global company and has its numbers are at the global level. The purpose of the slide was to show what was possible with the correct legislation.  Legislation should protect where possible future developments. Regarding partnerships, a partner is a rights-holder that applies to thousands of users. As such the figure of 8000 represents far more than 8000 partners. He added that illegal content (such as violent content) was not allowed on YouTube. On the use of the term “fear mongering”, there was a general feeling that could only be described as “fear-mongering”. Google was not paying any lobbyists. Legal positions are proposed by Google. It may have allies that openly share some views but there is no dealing that is not transparent.

Mr Sibanda responded about access to capital and resources. Fair use does not only work in highly-legislated countries. There had been only nine legal cases apply for violation of fair use in USA since its codification. The results in the screengrab that showed some illegitimate sites have been improved since – it was an old screengrab. That said, it is true that illegal videos and content do make it through Google’s algorithm. The system follows machine learning and it is an iterative process of protecting against illicit content.

Mr Esterhuizen reiterated his concerns about government receiving copyright.

Mr Sibanda responded that Google’s submission was limited to instances that Google was specialised to answer. Subsequent submissions will provide a better answer to such questions.

In response to Mr Kalako, he stated that Google fully supported the FOP proposal. It would in particular help them with the Google Street View product.  Regarding fair dealing and fair use, Google preferred an open list of exceptions, but the hybrid approach would also be fine [it is also open].

Mr Macpherson clarified some of his questions. He asked if there were any organisations that had presented that received any form of funding from Google. This did not necessarily mean they were paid to present to the Committee. On algorithms, he added that illicit sites such as Pirate Bay still come up on Google when searched - the algorithms were not working to pick up these sites.

Mr Macpherson added that the question of fair use as opposed to fair dealing [the existing provision in the law] was a crucial point for the Bill. Fair use in the USA had been debated for decades. He was not convinced that only nine cases in the USA were brought between 2009 and 2016. He felt that the country would end up with hundreds or even thousands of cases before a tribunal which may not be capable of processing them.

Mr Sibanda responded that there was no one who had received funding to say anything on the issue of fair use. He added that Google works in collaboration with many governmental departments and civil society.

Mr Macpherson pressed the question asking if any organisations that had presented had received funding of any kind from Google.

Mr Sibanda replied that Media Monitoring Africa received funding from Google.

Chairperson Fubbs stated that the Committee would move on. The South African Guild of Editors was not present but the Freedom of Expression Institute (FXI) and Kagiso Media could present.

Freedom of Expression Institute (FXI) submission
Ms Tusi Fokane, FXI Executive Director, said FXI was established in 1994 to protect freedoms of speech as written into the Constitution. FXI welcomed the fair use clause as an important enabler of freedom of information and access to knowledge.

Ms Fokane stated that the Bill was currently establishing the extent to the list of uses that would be allowed under fair use. FXI would argue for further opening of availability in the Bill but overall FXI was happy with the clause.

Mr Ben Cashdan, filmmaker and FXI member, took the floor. He had produced a film about Thabo Mbeki, which the SABC initially did not broadcast, claiming they had copyright ownership. Eventually, due to public pressure the SABC broadcast the film. Replication of others’ material was crucial to the creative process. Poetry is one such form of speech that has been excluded from the Bill. A poet, Ms Mandi Vundla, used such techniques, and was present to recite her poem, moving through music.  It referenced other poems and content such as from Bob Marley and Martin Luther King.

Ms Mandi Vundla then recited the poem.

Mr Cashdan explained that some of the lines she quoted were copyrighted material. However, because the excerpts were small quotes, “evocations”, the FXI felt it represented fair use and should be legalized. However, such use is not currently covered in the fair use formulation of the Bill. The Bill cites research, criticism, reporting, scholarship, illustration and parody – as such, it was not clear if a poem that uses an evocation was covered by such uses. Therefore, the FXI proposed that a more open list would be beneficial to the Bill.

In the Bill, in clause 10 amending section 12 of the Act, within the list of fair use exceptions, a clause should be added which mentions any transformative use that allows creative expression [in order that these uses also be excluded under the proposed fair use law]. A ninth item in the list should also be added which refers to computer-simulated intelligence. To reiterate, the FXI proposes two uses to add to the list: a) any transformative uses and b) artificial intelligence and machine-reading. FXI would also want to add the phrase “such as” to the exclusions list to make it more open.

Mr Cashdan commented on the concern that there would be a lot of case law and litigation which would be hard for those with few resources. He stated that it is generally not a matter of going to court. Most often, the rights holder would apply to an online company to take down work used without permission. As such, the first arbitrator is not usually a court but rather YouTube or Facebook and suchlike. Considering someone that wanted to make such a complaint, he posited that this person would prefer a clear and precise fair use clause which would help to avoid situations where it would need the intervention of a court. A clear clause which enables fair use could also prevent pirated use by having a subsection saying that such use is only fair if it serves a purpose different from that of the original work. Finally, the degree of substitution of the new work in the market for the old work must also be considered. If the work is providing a significant substitute for the original it is not fair use. A fair use clause is then a defender as it clarifies the rights of content creators. In this scenario, it would not lead to creators having to run to the courts.

Kagiso Media submission
Mr Collen Dlamini, Kagiso head of regulatory affairs, went through the Bill noting observations. Section 2A(3) was problematic. Owners of such unique content [tables and compilations] should be able to rely on copyright protection. IP creates success for these companies.  Kagiso’s proposal was that Section 2A(3) be struck from the bill. Section 5(2)(a) includes the phrase “funded by” but this is not defined in the Bill and it was not clear what the scope was. Did it include works that were partially funded or only those works entirely funded by the state? He noted the extent of the financial incentives of the DTI for Broad-Based Black Economic Empowerment (BBBEE). Would this clause mean these filmmakers would lose the right to the IP surrounding their work? This would thwart the objectives of employment creation. As such Kagiso’s recommendation was that the term “funded by” be adequately defined to apply only to work fully funded by the state and should exclude commissioned works and incentives provided by the state.

Similarly, in Clauses 4, 5 and 6 of the Bill, which correspond to Sections 6, 7 and 8 of the Act, the term “users” was not defined. It needs to be defined as it is the user that in principle must pay the owner of the works. The same applies to the word “use”. These terms must be defined or dropped from the law.  The prior permission required in Clause 8 was impractical. For example, on radio, people request songs. Kagiso would have it that the current system that exists is adapted and streamlined rather than have it replaced by the Clause 8 provision. Regarding Clause 9 of the Bill, the definition of “artistic work” was broad and would include book covers and logos for example. These artists could claim royalties for the resale right of the work. But their commercial interest was in getting the money up front. That the royalty rate would be prescribed by the Minister of Arts and Culture would remove the power of negotiation from the artists themselves. The recommendation was that the artistic works referred to in the clause be limited to specific artistic works. It should exclude commissioned works and there should be scope for the parties to negotiate an agreement.

Kagiso rejected fair use as in Clause 10 of the Bill (amending Section 12) as it was not a concept applicable in South Africa.  He felt that it would “open the floodgates” to litigation. In principle, it contradicts what the Bill is trying to achieve. The tribunal set up by the Bill would become overburdened. IT is not a tested principle in our law and should be removed. There were practical difficulties in treating all types of works as the same – it is not appropriate and simply cannot apply due to the nature of the works. The “ephemeral copies exception” which was already included under Section 12(5) of the Principal Act now extends from literary and musical works to all types of works. This clause was already being abused in practice by broadcasters and would now be open to further abuse. Kagiso’s recommendation was that exceptions should be limited to certain works.

Clause 12 of the Bill (inserting Section 13B) permits “any person” to make copies of works for “educational and academic activities” without the permission of the copyright owner if the copying does not exceed the extent justified by the purpose. It further permits the reproduction of “a whole textbook” as long as it is not for commercial purposes except for where authorized copies of the same edition cannot be obtained “at a price reasonably related to that normally charged in the country for comparable works”. There were difficulties with this as it bordered on allowing permission-free reproductions (and potential mass-copying) with no compensation. It applied to “all works” without limitation. This could be hugely detrimental to educational publishers such as Juta and of authors who write for the educational market. It would dis-incentivise the publishing industry from creating new and updated works if they can be copied freely in certain instances. Learners would then only have access to old or outdated editions of works which will in fact stifle educational development. Further, reference to “any person” would be open to abuse, while both phrases “for educational and academic activities” and “price reasonably related” were not defined. Kagiso commissioned PriceWaterhouseCoopers to study the economic effect of the clause and found that sales revenues at Juta would decline by 33% with 30% less employment and a reduced willingness of authors to create content. As such Kagiso recommended that the provision be deleted in its current form and amended in closer consultation with industry leaders in the educational sphere such as Juta.

Clause 20 of the Bill (amending Section 21) was a proviso that the author would have an exclusive licence to exercise any right by virtue of the Act where there is no contract governing the commission. This was problematic as authors often did not have a commercial interest in the work that they have been commissioned to create but would now be granted wider rights. Where small/incidental works are created such as a jingle for an advertisement, entering into contracts for these matters would be cumbersome and unfeasible. This additional red-tape would result in the recycling of old content producers as opposed to diversification of content creators. The recommendation was that the proviso that grants the author an exclusive licence to exercise any right by virtue of the Act be removed.

Clause 21 of the Bill (amending Section 22) proposed that assignments of copyright be valid for only 25 years. This would lead to practical difficulties in tracking down authors and re-negotiating assignment contract terms after 25 years. Producers would likely purchase works from abroad (i.e. works not created in South Africa or by South Africans) to overcome limitation. This provision would dis-incentivize local musicians, composers, songwriters, actors, producers, performers, publishers, designers and artists from creating any new works in circumstances where (1) they may have been commissioned to create such works and therefore have already been compensated, (2) they would, in the meantime, also be entitled to share royalties for the use of the work as contemplated in the Bill and (3) they will have an opportunity in 25 years to re-negotiate the assignment. If an author assigns a small work to Kagiso (for example) and Kagiso injects massive capital into launching a new campaign that utilizes such a work, and the concept gains in marketing value over time, the author may insist on re-negotiating more favourable terms after 25 years despite the fact that it was Kagiso that boosted the value of the work not the author. The recommendation was to remove the 25-year limitation on the validity of assignments.

Mr Dlamini stated that Kagiso would like to see new provisions added that sought the accreditation of entities as collecting societies. The reason was that there were huge pitfalls which already existed with the administration of existing collecting societies which were not adequately addressed in the Bill. For example, royalties were not flowing from collecting societies to the artists themselves. Kagiso proposed that the Bill define and stipulate more clearly what processes are to be put in place by collecting societies to ensure the payment of royalties to artists is expedited. Collecting societies should only be allowed to retain royalties for a certain period of time before such funds are paid to the artists. The administration fees of collecting societies should be reviewed and/or prescribed to avoid abuse by collecting societies in the charging of exorbitant and unjustified administration fees.

Mr Williams stated that Kagiso’s suggested clause “any transformative use that enables creative expression” was too broad. A cover song written with only, say, 10% transformation of the original work would not be required to pay royalties to the copyright holder.

Mr Esterhuizen stated that the fair use clause being discussed was too broad. RSA does not have the same litigious culture as in the USA; South Africans for several reasons do not take each other to court. 

Mr Macpherson asked Kagiso to elaborate on the possible positive effects of the fair use clause for creators or producers of work. He agreed with Kagiso that there would be practical problems with the Minister being made responsible for setting royalty rates. Even if possible in principle, this would construe a serious overburdening of the Minister’s office as it would have to evaluate the thousands of songs released every day to determine royalty rates. On the phrase “any person” in Clause 12, would the definition of any person also include government? He added that ICASA was the only body with the constitutional mandate to adjudicate over local content. The fact that this was overlooked showed that the Bill was badly drafted. Even a junior lawyer would have been able to spot this problem.

The Chairperson stated that the FXI needed to define “artificial intelligence” more clearly, otherwise it was inoperable. She took the example of people that travelled to the planet Mars and created new content there; how would this material be classified? The phrase needed defined boundaries. She noted that many institutions had indicated concern about the collecting agencies and how they should be defined. Mr Macpherson had pointed out that there must have been a standard operating to determine royalty rates or a single standard royalty rate. She asked what the existing system was and what the rate/rates were. How did Kagiso propose the royalty rate would work in the case of a cover song? What was their proposal?

Mr S Mbuyane (ANC) asked FXI what its view was on the notion that including fair use in the Bill might open a “legal floodgate”.

Mr Cashdan replied that the Chairperson’s example of Mars was not far-fetched and illustrated a useful point: the creation of artistic works not by a human. Google Magenta is a Google product that has access to all the music ever created. It allows artists to create music based on Google computers using algorithms that create new works from existing music. This is a form of Artificial Intelligence (AI) music generation. He felt that it was a good thing and beneficial to producers. It is not possible however without a fair use provision allowing a computer access and use of all of that music. At the time, it could only operate in the USA thanks to their fair use clause. The same operation was impossible in SA.

Mr Macpherson responded to Mr Williams explaining that simply by transforming 10% of a song would not allow one to “pirate” a song [use it illegitimately]. This is because Section 12(1)(b)(ii) states that in determining fair use, the amount of the original material used must be considered in relation to the whole of the work. This would directly deal with the concern Mr Williams had raised. He commented on the statement that fair use was untested in South African law and thus problematic. He drew a counter-example of the rights of the LGBT community which had not been tried or tested when the Constitution was introduced. That was not a good reason to not introduce fair use. 

Ms Tusi Fokane, FXI Executive Director, clarified the principle used to determine fair use. Cover versions and questions about transformation are better understood under a principle of fair use as there is a four-part test used to determine what is fair. The test specifically navigates this grey area that exists in prevailing law. On the point of the benefits to copyright owners, she commented that the world was digital and the economy was based on knowledge. Equality of access is more important than copyright protection. The benefit to the IP holder is that it provides greater clarity on when ownership has been infringed. On the claim that the fair use clause may be opening a “legal floodgate”, she commented that this legal commitment and risk involved was necessary to ensure we create an inclusive knowledge economy that benefits everyone.

Mr Sibanda agreed that the use of “funded by” was very problematic. The government funded a huge amount of work and would hold far too much IP under this definition. He agreed that the Minister should not set the royalty rate as this was impractical. It would not only overburden the Minister’s office, but it would also undermine certainty in terms of what the rate was, which was harmful to business. The Bill should at least specify what the rate might be in order to create certainty. He also agreed that the fact that the definition of “any person” including government would be problematic. This seemed to be the intention in the Bill and Google felt that it should be removed. The Bill should create more clarity on who should be allowed regarding copying for educational purposes. He added that ebooks are cheaper and more a controllable format for educational material.

Mr Sibanda agreed with Mr Macpherson that Section 9B(2)(b) providing for the Minister to set the royalty rate was problematic, and it should be removed from the Bill. Google welcomed the existence of collecting agencies but stipulated that these must be regulated as set out in the Bill. He added that a formula can be established to set the royalty rate.

Mr Dlamini stated that fair dealing had been working well in the country, and that Kagiso did not believe fair use should be introduced.

Mr Kalako asked if Kagiso owned all of the companies mentioned on slide 3 [which included companies such as Juta, East Coast Radio, Jacaranda Radio, MediaMark]. He commented on Clause 21 of the Bill, which stated that copyright would expire after 25 years. If material is re-launched and becomes popular after 25 years, surely the original author still deserved to benefit? This provision seemed very unfair to the creator. 

Mr Macpherson asked the FXI to provide information on a post made on the FXI website on the 25 June 2017.  The post mentioned a travel assistance grant given by FXI to people who wanted to publicly comment on the issue of user rights in the Bill. It was apparent that 10 people received the funding. Who were they and was their view generally consistent with the FXI?

Chairperson Fubbs stated that she wanted the information that Mr Macpherson had requested made available to the Committee. The matter would be raised again the following day.

Mr Esterhuizen stated that the Bill in many ways flew in the face of the principle of the rule of law, which is that law should be rational and predictable. The fair use clause as in the Bill makes it not just possible but also legal to violate the rights of creators.

Chairperson Fubbs commented that most South Africans seemed happy with the fair dealing provision that existed in the prevailing law.

Mr Dlamini replied that Kagiso was happy to keep the fair dealing provision. He added Kagiso could provide a list of bodies that were satisfied with fair dealing. In response to Mr Kalako he stated that Kagiso owned many of the companies on the list but that some were also joint ventures or associates. For example, Jacaranda is 80% held by Kagiso while East Coast Radio was 100% controlled by Kagiso. Kagiso was not only a broadcaster but also a creator and owner of content. Kagiso therefore had an interest in ensuring that creatives received dues for their work. This is why Kagiso supported the objectives of the Bill. Kagiso felt that a compromise would be necessary regarding the 25-year expiry provision. There was both the interest of the creator and the investor to consider. Despite its concerns, Kagiso remained behind the strategic objectives of the Bill.

Composers, Authors and Publishers Association (CAPASSO) submission
Nick Matzukis, musician and CAPASSO director, gave a personal testament of his experience as a musician and the necessity of knowing one’s rights as a musician. Musicians were often ignorant of the law and the bargaining power given to them by copyright law. Many musicians had rights of which they were unaware. Musicians did not know how to access or understand the copyright law that was supposed to protect them and their livelihoods. Many artists’ works were used and sampled without their permission. He felt that copyright was key to a musician’s success. As an author, educator, publisher and musician, he urged Committee members to strengthen musicians’ copyright protection rather than to weaken them. He explained that freedom of expression and healthy copyright laws were not mutually exclusive. He implored members to improve musician’s bargaining power and copyrights by ensuring that they own their copyrights. Predictability and bargaining power are essential to the industry. Users should not be permitted to share in copyrights without permission regardless of the technological arguments other speakers may give.

Mr Wiseman Ngubo, CAPASSO Business Affairs Manager, noted that CAPASSO has been able to distribute over R125 million in royalties since its inception in 2014. CAPASSO’s submission had six points.

Clause 3 of the Bill amending Section 5(2)(a) of the Act added the element of funding to the categories of works whose copyright will be owned by the state or specific organisations. Under the current legislative framework, all works made under the direction and control of the state may be owned by the state, with the exception of specific cases such as musical works. In terms of musical works, however, CAPASSO has been able to collect and distribute an average of R6 million worth of royalties to composers, but this amount would diminish with the introduction of the word ‘funding’ as proposed by the Bill. This R6 million should be considered along with an additional R80 or R90 million distributed by sister collecting societies for the exact same works and usage. Commissioned musical works currently worth over R100 million for authors would be decimated with the inclusion of the word ‘funding’. CAPASSO urged the Portfolio Committee to look into this carefully. Alternatives should be considered to ensure that the copyright remained with the composers to ensure earnings for composers throughout the continued rotation of their musical works.

In terms of general exceptions and specifically ‘fair use’, Mr Ngubo noted that although numerous discussions have alluded to ‘fair use’ and ‘fair dealing’ as able to co-exist, the two concepts were fundamentally inconsistent. This was because of the legal concepts of general exceptions and limited exceptions. CAPASSO was of the view that the concept of ‘fair dealing’ has worked in the country. Nonetheless, there were other ways in which the concept of ‘fair use’ could be incorporated into the usage of the concept of ‘fair dealing’. Other creative expressions could also be incorporated in this regard.

Mr Ngubo referred to the example given by another presenter of the impossibility of running a show like ‘The Daily Show’ in South Africa. This was untrue as the current quotations and news purposes would permit a show similar to The Daily Show, notwithstanding the operation of a limited fair dealing exception. In actual fact, there have been similar shows that focused on comments made on the current news just like that of The Daily Show by Trevor Noah. CAPASSO therefore, recommended that a more flexible legislation or flexible exceptions should be developed within the current system of fair dealing through the addition of more uses to be covered by these exceptions.

With regard to the personal use exception proposed by Clause 11 of the Bill (introducing Section 12A), CAPASSO argued for the introduction of a private copying levy. This would enable content creators and authors to benefit or at the very least, limit the exploitation, impact or harm that results from the extensive personal use exception that would be included. Reference was made to a UK-based judgment (see submission). The Portfolio Committee was urged to consider the inclusion of a private copying levy.

CAPASSO referred to Clause 22 of the Bill saying that orphan works were not a problem that affected musical works unlike other copyright spheres. As far as musical works are concerned, new methods have been devised to handle orphan works in terms of licensing and minimization of their impact. Collecting societies like CAPASSO and SAMRO circulate unidentified works to copyright owners in a way that allows copyright owners to make claims on such orphan works and in effect, enhance the circulation of orphan works for use. This medium also helped to identify the current right holder of such works. It was a functioning system that could be improved upon, but such system should be developed within collecting societies and not necessarily at the level of the government department in charge of regulating societies.

Mr Ngubo explained that the new clauses that seek to regulate collecting societies, as well as the danger in limiting the licence of collecting societies, such limitation would result in uncertainty about the continued existence of collecting societies. This would in turn lead to an expression of uncertainty by users in renewing or signing new contracts with collecting societies. CAPASSO therefore proposed that collecting societies should be granted unlimited licence or term that could be revoked by the regulating authority. This would ensure proper regulation of collecting societies without necessarily affecting the licensing and monetisation of works on behalf of the composers.

On a final note, it was pointed out that the Bill missed the chance to sort out matters relating to the bigger problem facing collecting societies, as alluded to by Kagiso Media. The main problem affecting collecting societies was not necessarily the licensing of works. Instead, it was the problem of non-reporting by broadcasters and users. It would be impossible for collecting societies to distribute royalties accurately without reported usage. CAPASSO, therefore, urged the Portfolio Committee to consider the criminalization of non-reporting and underreporting in order to assist collecting societies in functioning effectively. It was noted that the Act has limited the licence of broadcasting corporations in South Africa, leading to the inability of broadcasting corporations to have licence for mechanical reproduction of the regular usage. This limitation was purely based on the ephemeral exemptions contained in the Act. CAPASSO proposed that the ephemeral exceptions should be removed totally from the Act, especially since the purpose to be served by the exemptions was to avail broadcasting corporations the opportunity to broadcast cross two different time zones, a phenomenon that did not apply in South Africa. The exemptions should also be done away with since they served the purpose of justifying non-licensing of users, which will prejudice composers.

Mr Gabriel Le Roux, Composer and Producer, Music Association of South Africa (MASA) thanked the Committee for the opportunity to present the second segment of an initial submission made on 1 August 2017. The second segment would focus on specific clauses which the organisation, as the direct voice from within the ranks of composers, would like to urge the Committee to consider, reconsider and deliberate.

The music sector meeting with the President in 2009 was extremely heartening for composers and performers, as it gave rise to the subsequent Copyright Review Commission (CRC) Report of 2011 that focused on matters such as the need to align copyright legislation with the digital era, as well as the consideration of local content or the lack thereof, within the framework of economic transformation of South Africa’s new democracy. In terms of economic transformation in the context of the cultural sector, it has become apparent that song writers, music composers, poets, authors and other creative artists are viewed by average music consumers in South Africa as professional hobbyists. The reality, however, could not be farther from the truth. The message to the Committee was simple: the bills of these composers and musicians will not get paid if their music is not played.

MASA had waited with great anticipation as the first draft of the sister Bills (Copyright Amendment Bill and the Performer’s Protection Bill) saw the light. The 2015 draft Copyright Amendment Bill was not a disappointment due to the suggested clause 11: “The following section is hereby inserted in the principal Act after section 10:
“10A(1) … The broadcasting industry is under obligation to develop the culture and support the growth of local content in specified areas for the Republic, by amongst others -
(a) guiding the broadcasters to develop and protect the national identity, culture, character and strengthen the social and economic fabric of the country;
(b) promoting local broadcasting, local programming
The clause went to state that “obliging the institution regulating the broadcasting industry [known as ICASA] to use measures to ensure compliance with the obligation to promote local programming;”
A direct link is reflected here between the Act itself and the Authority.

However, in March 2016, ICASA, which was obliged to use measures to ensure compliance with the obligation to promote local programming, issued guidelines of 70% for public and 35% for private commercial radio. The public broadcaster at the time was quick to object and this was well-publicized when a certain Mr Motsoeneng who defiantly, firmly held on to a maximum quota of 60% because of his connection to SABC. It was surprising to discover two months down the line, around election time, the same person boldly and opportunistically announced a 90:10 split between local and international content to be implemented immediately overnight on the national broadcasters radio channels. Members of MASA who had been campaigning for high local content immediately heard alarm bells ringing when on the one side, marginalized local composers and musicians were rejoicing, singing Mr Motsoeneng’s praises, while on the other hand a largely Americanized, westernized consumer public, especially amongst the previously and mostly still currently advantaged community sectors went into combat mode to fight the ‘scourge of African nationalism’.

The Chairperson cautioned that some of the comments made could be used in responding to issues that may arise during the engagement with MPs.

South African Guild of Editors (SAGE) submission
Ms Marina Du Toit, SAGE chairperson, noted that SAGE represents post-production professionals in the film and television industries, which meant that the organisation specialized in video and sound editing, and was not involved in newspaper or magazine editing. SAGE argued for appropriate recognition and reward for editors as they played crucial roles in the work of actors and creators (see submission).

Mr A Williams (ANC) said he was slightly confused about Mr Matzukis stating that he was not getting the remuneration due to him under the previous legislation despite his being in the industry for many years. He asked what changes can occur as a result of the new law that would benefit music performers and producers. Proposed clauses should be suggested for insertion in the Bill and submitted to the Committee in writing. He could not pick up concrete proposed amendments to the Bill from SAGE’s submission. He also asked SAGE to submit concrete proposals to the Committee in writing.

Mr J Esterhuizen (IFP) remarked that the submissions have been characterized by repetition of the same issues, particularly about fair use. It has been mentioned that works can be used freely and it was only a court of law that can determine the fairness of usage. In his opinion, this meant that once the usage of a work is considered unfair, users would have no right over such works. Throughout the Bill, reference is made users, and this creates a perception that users are right holders themselves. This gives the impression that users can claim royalties, regardless of the context. On orphan works, he noted that the definition of orphan works meant that such works were no longer a substitution of the definition of reproduction, but this was incorrect. As for editors, his view was that editors played a major role in any creator’s work and should be rewarded accordingly. Space should be made for editors.

The Chairperson referred to CAPASSO’s statement that it was legally impossible to develop a hybrid between fair use and fair dealing. In her opinion, lawyers dealt with seemingly impossible situations by developing relevant laws to address such impossibilities. She asked CAPASSO to clarify this point.
She also asked for a clearer explanation of the private copying levy, and for the rationale for musical works to be exempted from the orphan works regime.

Mr Matzukis, CAPASSO chairman, replied that although he was not happy with the remuneration received as a performing and composing artist, the poor remuneration was not due to a lack of legislation or improper legislation. It was rather due to his failure to understand the legislation. Education was the key in this regard, and in almost all industries in South Africa. Quite a number of issues would be resolved if and when South Africans understand their rights properly, and if such rights are simplified and clarified. Such rights would be simplified and clarified through education.

The amendment process was an opportunity to improve the clarity of both the Copyright Act and the Performer’s Protection Act. In his view, the biggest problem in the music industry was incorrect reporting of music usage by users. This is due to the lack of an ethos, an obligation, or a feeling on the part of users to report usage on a regular basis. It was either that reporting was not done or it was done unsatisfactorily or incompletely, and therein lies the problem. If broadcasters all reported their usage, both mechanical reproductions and public performances properly, fully and timeously, the collecting societies would have little or no problem distributing the money collected to the appropriate parties. The problem of poor reporting did not only occur amidst the biggest public broadcasters in the country; but also reflects all the way down to the clubs, pubs, or restaurants where payment of SAMRO and SAMPRO licence fees would have been made but correcting reporting of music used would not be done. Although CAPASSO has lobbied for greater local content to be used, the result would still be that music would continue to be used without moneys going to the appropriate quarters due to the lack of information needed to distribute such moneys properly. This was the biggest problem in the music industry today.

Education was still needed to address this problem. Such education should be made compulsory in all tertiary education institutions. However, a private copying levy should be imposed. Such levies have been successfully imposed in border countries like Botswana, and are most certainly imposed in other countries of the world. The levies would contribute massively to the distribution of more funds to composers and performers who deserve this, regardless of the continuation of piracy.

Mr Ngubo replied that CAPASSO had previously suggested wording changes to the 2015 draft Bill, as well as in its written submission on this Bill. However, the organisation would be happy to send in specific wordings again following this session. But as far as the wording of fair dealing and fair use was concerned, CAPASSO was of the view that words like ‘parody’ and ‘prestige’ could be added to the current fair dealing provision, in order to achieve more flexibility without necessarily imposing an entirely new legal concept. For example, the statistics given by Google show that America has had fair dealing for decades, yet it has recorded nothing less than one fair dealing case per year for the past seven years, which was on the high side for a country with actual jurisprudence. This meant that a country like South Africa that has no jurisprudence on this would have excessive fair dealing cases.

On the coexistence of fair dealing and fair use, and why a hybrid system is necessarily unachievable, Mr Ngubo replied that by definition, fair dealing was limited to specific cases, whereas fair use was a general exception. When any of the three provisions needed for certain steps is included in a hybrid system, it would become an open system, just as the inclusion of the term ‘such as’ in a limited scenario would result in making such limited scenario a general one. In essence, the hybrid system was in fact a general system.

The rationale for the proposed exclusion of musical works from the process was the existence of currently functional mechanisms and systems in the musical industry that were not available in other artistic works sectors. These systems have been developed for years with current databases that were currently in use.

Mr M Kalako (ANC) asked how transformed SAGE was. On the proposal for collecting societies to be granted rights to make collections on orphan works, he asked what the revenue generated from orphan works would be used for. He asked if the proposals made on orphan works, alongside regulation of collecting societies, would result in the effective management of orphan works as far as musical works were concerned. He asked if CAPASSO received support from other broadcasting sources and radio on the amount to be paid to it as a collecting society.
The Chairperson recalled that around 2009 when the President met with the musicians’ delegation, it was brought to the fore that collecting agencies were taking all the money. This raised a concern, especially now that the same collecting societies have been put in charge. She asked for precise information on musical orphan works that have been rescued. She also asked SAGE to explain the actual purpose served by the organisation, as well as details about the works being edited.

Ms du Toit replied that SAGE was an open organisation, and was open to anyone to apply. The organisation has an application system, with the aim to promote the art of editing. However, the editing industry was expensive to get into because of the requirements for editing, which was different from writing or acting. Editors need access to electricity, powerful computers, software, the internet, and schooling, which was quite expensive. It was not any better if one decided to train oneself, as such individual would still need to access the internet to watch videos. Commencing a career in the industry was also very tasking, as it was quite difficult to secure good pay at entry level. Usually, producers appoint interns that work very hard, but as soon as such interns want more money, they are replaced with a new set of interns. It was therefore very difficult to become financially sustainable in this industry, and this made it quite difficult to incorporate the needed transformation. SAGE was aware of this problem. About 20 to 40 years ago, people kick started their careers in the industry as assistant editors, but because the budget has depreciated over the years, funds were unavailable to train assistants. In terms of how transformed SAGE was, the organisation did not request race or gender in the past. However, the transformation process has commenced, as SAGE was aware of the gap. As for the Guild, anybody can volunteer to be on the Guild but because it was an unpaid position, not many people are keen about the position.

Ms du Toit said that the local production originally proposed by SABC would have been beneficial to the editing industry, as it would have provided more jobs for subtitlers and people fluent in many African languages. It was unfortunate that the productions did not materialize.

SAGE received quite a lot of footage to edit. Where the footage was for a film or drama, it would be shot according to the script. If it was for a reality show, it would just be a camera pointing and recording. The stories would then be created in the edit suites. In essence, there would be no film or drama without editors. The same principle applied for sound editors. Music was an important part of production and songs are scored and inserted alongside visuals. Therefore the role of editors was to recreate reality. This cuts across all media, including the news. It was only what editors allowed that would be broadcast.
The Chairperson was impressed by the honesty of SAGE in acknowledging its transformation shortcomings. She asked that SAGE put its responses in writing, along with its ratios for the organisation’s profile.

On use of funds from orphan works, Mr Matzukis replied that the existence of good and bad collecting societies was a fact, just as there were good and bad labels and publishers. South Africa had an embarrassing history internationally in this regard. A music collecting society in mechanical rights used to be in existence, and it constituted the space which CAPASSO now occupies. That society remained relevant, notwithstanding its history, but it was run with double accounting. The judgment of the judge at the time of making the society insolvent captured the shocking things that occurred in that society. The CRC Report had even recommended that the director of the society should be prosecuted. Despite the fact that bad collecting societies existed, Mr Matzukis noted that there were still some good ones, some of which were present at the meeting. These societies were run transparently, honestly and with open accountability to their members. CAPASSO was one of these good collecting societies.

As far as orphan works were concerned, such works were categorized as “undoc”, which meant undocumented, due to the lack of information on the owner, author or direction to which the money generated from such work should be distributed. Where a collecting society has been paid for the use of undocumented work, albeit presumptuous, the society would hold on to such money in terms of its rules and approval by the registrar. The industry was evolving towards regulation, which should be welcomed by all collecting societies. The regulation by CIPC would be the best thing to happen to the creative arts. Transparency would become unavoidable once the regulations are implemented.

The rule upheld in CAPASSO was to diligently seek owners of undocumented work, using various mechanisms, including internet researching, available databases, and so on for a period of three years. The money from such undocumented works would not be distributed until the expiration of those three years, after which two options were available. The first option was to distribute the money to existing right holders if the rules provide for that. However, CAPASSO would only be able to meet the three-year criteria later this year, as it was established only in 2014. Other collecting societies either distribute to their existing members, while some of them adopt the method used in the sound recording collecting society, which was to establish a social benefit fund with the money from undocumented works and reinvest such moneys back into the industry by providing support for needy performers. Above all however, it would be impossible to ensure appropriate distribution of money where accurate usage information was not given. Hence, the support for criminalizing failure to provide usage information as is being done in other countries.

Mr Ngubo responded that regulation would improve the current orphan works process as one of the biggest requirements for collecting societies would be to account to the regulator what they have done on a yearly basis, specifically including including the number of orphan or unidentified works that have been identified on an annual basis. Where no orphan work has been identified, societies would be given the chance to make amends. The introduction of regulations will improve compliance and ensure a diligent chase of all unidentified works on a more regular basis with more accountability to the regulator, especially as the licensing of collecting society depends on it.

The Chairperson noted that the different points emanating from the Committee’s engagement with various organisations has been enlightening. She said, however, that the idea of addressing these issues from a mechanistic point of view rather than organically, was problematic. This was because although South Africa was grounded in Roman Dutch law, which was stricter and more definitional than the American legal system, governance styles have changed as South Africa was now governed by the Constitution. Roman Dutch law still abound in the country, particularly in contract law. She urged organisations to put their submissions and comments into proper context in terms of the approach they choose; whether mechanistic, organic or Cartesian. In her opinion, it seemed South Africa was shifting to a more organic context rather than a mechanistic one. Responses tailored to this approach would be very helpful to the Committee.

MultiChoice and M-Net submission
Mr Kwezi Mtengenya, Multichoice Regulatory Affairs Director, explained that it would be essential to describe to the Committee how the industry worked. Ms Phahle would go through the basics of what takes place behind the scenes to assist the Committee in appreciating the complex nature of the industry, as well as putting some of the concerns of the entity into proper context. He recalled that at the 2 August hearings, the SAMRO chairperson lamented that the drafters of the bill did not create time to engage with people in the industry in a bid to understand the mechanics of the industry. This inaction reflects in some areas.
Ms Kantor would deal with the global context in which traditional broadcasters find themselves. Ms Rosenberg from Werksmans would present the entity’s overarching concerns. In this section, MultiChoice and M-Net would join a number of other submissions that have raised concerns about the vagueness of some of the provisions, with the sole intention of assisting the Committee in producing a Bill that is precise, clear and more importantly, implementable. Ms Willenberg would deal with specific issues before a conclusion is made.

Multichoice and M-Net were homegrown, pay TV broadcasters that invested extensively in the local film and television sector, and would continue to do so. The two entities were part of the major funders of the sector. The entities would return to the Committee to share some of the work done in this regard at an appropriate time. The aim of the current engagement was to urge the Committee to ensure that the process resulted in a birthing a copyright framework that sought to balance the interest of investors and creators, as well as give strong copyright protection so that creativity was incentivized. On the whole, they supported the goals of the Bill. Nonetheless, there were concerns about the possible negative impact, particularly with regard to investment. Attention was drawn to the extensive written submission.

Ms Yolisa Phahle, CEO: M-Net, reiterated that MultiChoice and M-Net were extremely committed to investing in the local production industry. The programming, channels and variety of local languages broadcast were a testament to this. Theybelieved that local content production was not only a way of creating businesses and jobs but the preservation of South African languages, history and culture was also very critical.

She went on to explain that there were many different models by which local content was produced, and acquired, which made local production quite complicated. In some cases, the entities would bear all of the risk by putting up money and commissioning shows. In such cases, the copyright would be owned by the entities. However, in other cases where they co-invested with another entity, the copyright may be shared with producers and other investors. With regard to commissioning, an example could be seen in a show like Isibaya or The Queen that was shown every night on Mzanzi Magic. Although the production was a collaborative process, the reality was that not all of the creators and performers made equal contributions.
Indeed, productions varied. There was drama, live shows and reality TV shows, and on some of these shows the audience cut across hundreds of thousands. An example was Idols where they went round the country auditioning hundreds of thousands of people. In such cases, there were thousands of contributors, which made production very complicated, despite the collaboration. It was for this reason and also because of the differences that they were of the view that it was not advisable for the legislation to contain specific provisions on the contractual aspect of production.

She highlighted the fact that with commissioned productions where broadcasters technically put in all of the money, not all productions were successful. In fact, many productions resulted in significant losses, which would be borne by the broadcaster. For example, M-Net made a very expensive production a couple of years ago called The Road. The programme did not find an audience, and ultimately M-Net had to terminate the show. Despite losing a lot of money, M-Net still had to pay the cast and crew. By the time the show was broadcast, everyone in the production, that is the writers, actors, and directors, had all been paid; they did not share the losses, neither did they share in the risks. It was for this reason that M-Net upheld the view that where all risks of production were borne by a company, such company should be entitled to the copyright.

New models of production were increasingly welcomed, especially those where the risk and investment was shared. In this case, the intellectual property and copyright would be shared. Examples of productions where copyright and risk have been shared include big films such as “Happiness is a four-letter word”, “iNumber Number” and “Keeping up with the Kandasamys”. These were examples where the model used allowed for sharing of copyright with other entities and producers.

The overall goal of the MultiChoice was to achieve a sustainable industry and to that end, a considerable amount of money has been spent on the MultiChoice Enterprise Development Trust, which has paid out nearly R70 million in either grant funding or interest free loans to assist in the creation of new businesses and new production companies. MultiChoice also has an internship scheme at M-Net called The Magic in Motion Academy that was aimed at empowering and developing film makers for them to be able to go out and build companies and businesses.

In summary, ongoing investment in local production required an enabling environment. It was important for the Bill to create the right balance for this to happen. Although production was collaborative, it was also very complex. The creation of great content was dependent on the flexibility available to negotiate with other partners in the production industry to achieve agreed terms that would work for the parties involved.

Ms Lara Kantor, General Manager: Regulatory, MultiChoice, focused on the global context and how it impacted on the local production and television industry. The first factor was with respect to the disruption caused by internet services. It was not an exaggeration to say that the internet has completely transformed the way content was being distributed and consumed, as the result was visible all around. Globally, broadcasting has been decimated by internet services such as Netflix, YouTube, and Amazon Prime. Traditional broadcasting services were being decimated by these new online services. There were now own markets where global players were competing with local broadcasters for audiences and revenues. These global players did not make any investment in local content. What this meant was that the economic model for investment in local production was actually being undermined by these global players, while at the same time local broadcasters had strict requirements on local content and a whole other range of regulatory requirements. It was through this lens that MultiChoice and M-Net were viewing copyright. The entities were concerned that the Copyright Amendment Bill would further worsen the position that local broadcasters have found themselves in by dis-incentivizing investment in local content and constraining the ability to use content rights on multiple platforms.

A second issue was technology being an enabler of piracy, which also enabled copyright infringement on a colossal scale. Piracy was a threat to all content creators and distributors. Piracy really meant revenue losses for everyone in the value chain and unless it was addressed, it would continue to erode incentives to create and invest in creativity. MultiChoice believed that an effective and actively enforceable copyright regime was absolutely critical. It therefore recommended that the Copyright Amendment Bill should go a step further by helping broadcasters combat piracy. It made three proposals on this: Firstly, that the right of communication to the public should be extended to broadcasts and programme-carrying signals; secondly that the provisions dealing with technological protection measures should be strengthened; and thirdly, that the anti-piracy drafting should be improved. Drafting proposals would be submitted to the Committee.

In summary, the conditions for local broadcasters have worsened due to global forces which has made it difficult for entities such as MultiChoice and M-Net to control or influence. This meant that the economic model for local production was becoming weak. A fair and robust copyright regime that would enable investment in local production to flourish in the face of this hostile global environment was therefore needed. It was on this basis that proposals have been made on how the Bill can be improved.

In presenting the overarching concerns, Ms Wendy Rosenberg, Director: Werksmans Attorneys, began by noting that the Bill raises constitutional concerns in three aspects, namely vague provisions; proposals to regulate local content and broadcasting services; as well as proposals to give the Minister unguided discretionary powers. With regard to vagueness, many provisions in the Bill were ambiguous, unclear or indiscernible. There were some overlapping definitions; undefined terms, as well as sections that overlapped substantially. Such provisions may be challenged constitutionally on the basis of their vagueness. The legal doctrine of vagueness required laws to be written in a clear and accessible manner in order for people to understand the law and behave accordingly. It was therefore proposed that vague provisions in the bill should be amended and clarified.

In terms of local content regulation and broadcasting, the insertion of Section 39(cL) proposed the empowerment of the Minister of Trade and Industry in consultation with the Minister of Communications to prescribe the local music content for television and radio broadcasting. The effect of this would be that these two Ministers would begin to regulate broadcasting. However, in terms of Section 192 of the Constitution, only an independent authority may regulate broadcasting and that authority was ICASA. Neither of the Ministers was an independent authority as contemplated in Section 192 of the Constitution. The Committee was therefore urged to delete Section 39(cL).

The third issue was in respect of unguided discretionary powers. Section 39(cG) and (cI) granted the Minister wide far-reaching powers to prescribe compulsory and standard contractual terms, as well as royalty rates or tariffs for various forms of use. These provisions and proposed powers were far reaching and they provided no guidance as to the purpose sought to be achieved or the manner in which the power should be exercised. The Constitution requires that where the legislation grants broad discretionary powers, the statute must set out guidelines for the exercise of that power. Where a law simply grants a wide unguided power, it does so against the rule of law and the provisions were liable to be struck down. It was for this reason that MultiChoice suggests that Section 39(cG) and (cI) should be deleted from the Bill.

Several other provisions inhibit the freedom of parties to contract on mutually agreed terms. Examples include the compulsory and standard contractual terms and royalty rate; limiting the period of the assignment of copyright to 25 years, and so on. The courts have emphasized the sanctity of contracts both generally and in the copyright context. However, there were important practical reasons why it was not desirable to set contractual terms in legislation, as it reduces the autonomy of parties to deal with their property as they see fit, which is protected by the Constitution. Each right holder should take into account a range of factors when negotiating contracts, which vary between and within sectors, between individuals, at different points in time.

As mentioned already, the local film and television industry was complex and collaborative. M-Net therefore develops and invests in local producers and film makers in multiple ways not contemplated by the law nor can be catered for by the law. This was because legislation was not flexible or nuanced enough to contemplate all scenarios in all sectors. Copyright was often created in dynamic industries. It was well known that the law takes a long time to make, becomes outdated quickly and cannot respond swiftly to change. It was for this reason that MultiChoice and M-Net proposed that the provisions of the Bill that limit the freedom and flexibility of parties to contract on mutually agreed terms should be revised. From experience of the entities, most countries left contractual matters to commercial negotiators. Guilds, industry associations, and collecting societies have yielded the most favorable outcomes for authors and performers. Concerns that bring up further interventions and which were necessary to protect authors and performers should be addressed by strengthening collective negotiation mechanisms.

Ms Karen Willenberg: Legal and Regulatory Consultant: MultiChoice, focused on three specific provisions, which the Bill proposed as additions to Sections 6, 7 and 8 of the Act. These sections dealt with the nature of copyright in literary works, musical works, artistic works and films. For each of these works, the Bill has introduced a clause on royalties, specifically directing who should have a right to claim royalties for each of these works. The list of those entitled to royalties was very long, but it included users, performers, owners, producers, authors. The sections also direct how the royalty should be shared, and also provides that each of the listed people should be entitled to claim an equal portion of the royalty. MultiChoice is not the only entity that has highlighted these clauses as being problematic. Nevertheless, some practical challenges that may affect the application of those clauses should be laid bare. Based on what Ms Phahle mentioned, the question should be asked how to apply these clauses to a show with eight writers, 18 performers, three producers, with each person contributing different amounts, for argument sake? It was apparent that a provision of this nature will only result in lengthy disputes and litigation but more importantly, it showed the impracticability and inappropriateness of dealing with contractual terms in legislation. It was therefore proposed that matters of this nature should be excluded from legislation.

The second provision was in relation to communication to the public. This was a very welcome amendment. The Bill proposes that the right of communication to the public should be extended to literary works, musical works, artistic works and films. MultChoice was of the view that this was an essential amendment which was necessary to bring the Bill into the digital era, which was one of the objectives of this process. However, this right has not been extended to broadcast and programme carrying signals. As explained by Ms Kantor, broadcasters are dealing with piracy, which included signal piracy as a big issue in the broadcast environment. There was no rational basis why the right of communication to the public should not be extended to broadcasts and programme-carrying signals. Fortunately, this was a fairly easy issue to remedy. MultiChoice therefore requested that the current drafting on communication to the public should be added to sections 10 and 11 of the Act which dealt with broadcasts and programme-carrying signals.

The third provision was on commissioning and the proposed amendment to section 21(1)(c) of the Act. As explained by Ms Phahle, there were a number of different ways in which broadcasters acquired content. Importantly, a commissioned programme has particular features. It is produced on the instruction of the broadcaster. The broadcaster covers 100% of the cost of production and the broadcaster assumes 100% of the risk of production. Commissioning was not the only way to create content. In cases where cost and risks are shared, rights are also shared. In the case of television production, the contention was that it was active to funding. This was a far greater issue than the ownership provision set out in section 21. As different funding models arrive, rights will naturally follow and this would give rise to different models of rights ownership without any amendment of section 21. It was therefore proposed that the section should not be amended.

Mr Mtengenya wrapped up the submission by the team by noting that separate submissions dealing with the proposals from MutiChoice and M-Net have been developed and submitted to the Committee.

Mr D Macpherson (DA) noted that the inputs made by Ms Phahle were not only made in a South African context, but also in a global context. He noted that the decision of government to encrypt set top boxes to protect channels or signals from being pirated or content being stolen was a bit strange. That decision would seem at odds with what the Bill was proposing. He therefore asked for the views of the entities on this, as well as a possible contradiction as to what the telecommunications industry was trying to do by encrypting set top boxes to protect their content, as well as what was put out by signal producing broadcasters.

Mr Esterhuizen said that technology has changed much of the copyright laws in our world, and has led to creators using materials of other people. In a situation where an individual was a broadcaster, and another person was a music composer, who writes the theme song for a year for the broadcaster, the legal position with respect to copyright would be that every time the show was aired, the composer would get commission for it. However, with the new copyright law, everything could change as the composer stands to lose the royalties after submitting the theme to the broadcasters, notwithstanding the fact that the broadcaster would never air the show or theme if it were not financially viable. He said that copyright legislation should not become a barrier to creativity. Instead, it should be for the benefit of society as a whole.

Mr Kalako was interested in the disadvantage broadcasters in the country have vis a vis the global competition, and the omission of this issue from the Bill. He wanted to know what proposals would be made by MultiChoice and M-Net on this; and whether this should be regulated with the global competitors in this area. He noted that proposals made by the entities were clear in the suggestions in other areas of the Bill. However, he asked if they agreed with the stance of Google that piracy could now be clamped down easily due to the current development of its technology and new innovations. However, it seemed MultiChoice and M-Net had a different view on this. It was particularly a problem because the issue was not thoroughly addressed in the Bill.

The Chairperson referred to their submission suggesting that section 21(1)(c) was not the correct approach to take and sought clarity on this. She also noted the constitutional concerns. She asked the Parliamentary Legal Adviser to confirm that Bills were only brought to Parliament after going through the state law advisers.

Adv Charmaine van der Merwe, Senior Legal Adviser, confirmed this and said that the National Assembly Rules required the state law advisers to consider the Bill and certify that the Bill complies with the Constitution. The Bill under review has been certified by the state law advisers.

The Chairperson said the points made by MultiChoice in relation to constitutional issues, especially with regard to vague provisions, were issues that should be addressed in the Committee. As far as ICASA being the only independent constitutional authority to regulate broadcasting, she would seek further constitutional advice, as she was not aware of that position before now. She remarked that the submission on curbing unguided discretionary powers was fair. She requested that a proposal in writing should be made to the Committee on what would be considered appropriate in this regard.

Mr Mtengenya responded about encryption to protect signals, saying the Constitutional Court upheld the government policy that there was nothing untoward with the decision that the government took in excluding encryption in the set top boxes. MultiChoice would not want to contradict that decision. Conditional access encryption was not a mechanism to protect content. Encryption was only a mechanism to allow broadcasters of pay television services to switch on and switch off the paying and nonpaying subscribers. This was the sole purpose of encryption, although this purpose has been distorted. In the UK and USA, free to air shows had no mandatory STB encryption. There was separate software that dealt precisely with content protection. HTTP was a content protection mechanism; while encryption was not a mechanism to protect content. The Constitutional Court has upheld the government’s decision in this regard.

On composers losing royalties, Ms Willenberg urged that Members should not lose sight of the objective of copyright law, which was to incentivize creativity. An issue discussed at length at the current hearings, and which would have the greatest impact on creators of copyright works was the debate about fair use versus fair dealing and how it should be dealt with in the legislation. The position of MultiChoice has been set out in detail in its written submission. The arguments are similar to those of CAPASSO, which was to the effect that a fair dealing exception that sets out a limited list of usages permitted, was infinitely preferably to an open ended type of provision.

She noted the concern picked up by Mr Macpherson in his response to Google’s submission about fear mongering and litigation, as well as the possibility of fair use not resulting in litigation. In that submission, it was noted that as at 2009 which was the year when litigation was being considered, the fair usage doctrine had existed in US law for quite a number of years. Very usefully, an American professor of law has done an analysis of litigation immediately following the introduction of the fair usage doctrine in the 80s and 90s following its introduction in 1978, and has found 306 reported judgments on the application of the fair usage doctrine. Mr Macpherson was therefore correct that nearly 40 years after the introduction of that provision, litigation was still being used to determine the ambit of what exactly constitutes fair usage. She ended by cautioning that the concerns raised by creators should not simply be dismissed as fear mongering.

On the question of whether global competitors should be regulated, Ms Kantor said that their submission was not a call for the regulation of global competitors through the Copyright Amendment Bill. Reference was only made to global competitors to further explain the context within which local producers and broadcasters were operating. MultiChoice was investing in local content; doing its best for its audiences and the local production industry at large; and at the same time, competing with global competitors. The Committee was urged to consider the Copyright Amendment Bill in terms of its impact on local broadcasters. The goal should be to craft legislation that would take the interest of local broadcasters and content into account, and which would balance the interest of local broadcasters with the interests of other local role players.

On curbing piracy, Mr Aynon Doyle, MultiChoice Head of Policy Analysis and Research, said it was not easy to deal with piracy. Therefore broadcasters, especially pay TV broadcasters invest millions and millions each year for the singular reason that once one form of piracy has been addressed, a new one arises. There were instances where a continuous running battle of an acceptable level of piracy occurred, and there were other instances where such levels of piracy would actually destroy a business. It was at the latter instance that piracy becomes very expensive. An example was in Botswana, the Sentech encryption method was hacked and viewed through free-to-air decoders. This was to the detriment of local broadcasters in Botswana and after being unable to track down the people who were selling the decoders, they took Sentech to court. The Johannesburg High Court found that Sentech had failed to update its technological protection measures and for that reason gave judgement against Sentech to pay damages to e-Botswana. In addition to that, Sentech was also required to update the entire mechanism. In essence, it was extremely costly not just for the broadcasters but for anyone on satellite that has to limit access to a specific geographic footprint.
Although Google has been taking down pirate sites, new pirate sites keep coming up. As noted by Mr Macpherson, beneath a Google search, one may find three or four links at the bottom of the page that says “taken off for DCMA reasons”. This was a takedown notice. This reflected cases where the copyright holder has informed Google directly of the piracy link and has requested a takedown. A big concern at the moment was that although South Africa had takedown provisions in the Electronic Communications and Transactions Act, those provisions were being repealed by versions of a schedule that was in the Cybercrime and Cybersecurity Act. This raised a concern as the provisions could end up having a far narrower interpretation, in which broadcasters might not have been taken into account. It was for this reason that MultiChoice argued for the capturing of the protection of broadcasters in the copyright law as well.

Mr Mtengenya added that a further extensive submission would be made on the matter.

On section 21(1)(c), Ms Willenberg said that the MultiChoice submission was that the problem has been misdiagnosed. The problem was not with commissioning parties expecting to own the rights. Rather, the problem was the heavy reliance on commissioning as the model for acquisition. Therefore when law makers submit that producers own the right in other countries, they would not be wrong. However, producers owned the rights in other countries, not because the legislation provides for it, but because the money flowed differently in those countries. The access to funding and ways in which funding was raised was different. It was for this reason that MuliChoice held the view that the exclusive fixation on commissioning was misplaced. It was necessary to begin to explore other ways of acquiring content, as well as unlocking funding for the creation of content to enable those other ways to happen.

The Chairperson thanked the team from MultiChoice and M-Net. She urged that they should submit in writing their overall impression of the multiplicity of international filmmakers in South Africa given the different funding methods. They may be required to reappear before the Committee to engage on other issues that have been identified.

Mr Mtengenya begged the indulgence of the Chairperson to clarify the issue of MultiChoice’s ‘ownership’ of the SABC archives. MultiChoice has never bought the SABC archives, neither has the SABC ever sold any of its archive to MultiChoice. The SABC has never relinquished its ownership and control of the archives. What MultiChoice has is a licensing agreement, which the Communications Portfolio Committee was already dealing with.

Recording Industry of South Africa (RISA) submission
Adv Nhlanhla Sibisi, RISA CEO, highlighted a recurring issue that has been ongoing for a while, in respect of the amount that flows out of the country in royalties paid to multinationals. This would be addressed by Mr Sipho Dlamini. RISA represented an average of 4 000 independent South African record companies. The experiences of independent record labels would be expounded in greater detail by Mr Thobela Dlamini.

The rights contained in section 21(1)(c) on the commissioning of works also affects the music industry. As noted by Multichoice, in cases where artists fail to invest in a recording, organisations like Multichoice invest in such recordings and would therefore own copyright according to section 21(1)(c). However, in terms of the debate on fair use versus fair dealing, the recording industry did not believe in limited exceptions; instead, it believed that the implications of the fair use provisions incapacitated the industry in pursuing litigation. Therefore transposing fair use on South African law was problematic. America has 250 years of precedents around many issues including fair use. It would be impossible to import such a volume of precedents into the South African context.

Mr Thobela Dlamini, Deputy Chair: RISA, noted that there has been a perception that the recording industry was an association that only spoke an international language, and not the South African language. He reiterated that RISA was currently representing 4 000 members, and of those 4000 members, there were only three multinational companies: Universal Music, Sony Music, and Warner Music, based in South Africa. Other members of RISA were independent record labels in South Africa. Examples of independent record labels include Kalawa Jazmee Records, Mabala Noise, Afrotainment, David Gresham, Gallo and Soulistic Music. RISA’s scope was very broad. Nine out of every ten songs played on the radio were songs released by RISA members.

RISA played a critical role in bringing about the advocacy for ‘needletime’ rights. RISA was also the custodian and official organizer of the South African Music Awards which has been taking place for the past 23 years. It was an institution having the interest of South African music artists at heart. The board comprised of a good mix of South Africans, and it oversaw companies in South Africa. It also ensured that South African local content received the attention it deserved. The aim of RISA was to represent South African music, as well as ensure that the rights and benefits of South African artists did not accrue to outsiders.

Mr Sipho Dlamini, Managing Director: Universal Music Group, presented a high level overview of the music industry’s ecosystem. He explained that songs usually began with a composer and lyricist who would write the song. They will be assisted by music publishing companies or publishers. Recording companies would thereafter record the music and distribute it via the various available platforms. They would also market the products to the consumers on different channels. RISA was at the bottom of the chain, as it performed oversight operations on the recording companies in South Africa, both independent and major labels.

In terms of the role of record companies in investing in South African music, record companies invested heavily in South African talent, thereby creating jobs. Record companies in South Africa also were also a counterweight to other African companies and to global markets, allowing South African talents, music and performance to be heard and seen across the oceans in different markets.

In terms of the changing environment of the music industry, there has been a progression from cassettes to and records, to CDs, and digital and streaming which was now the most widely consumed manner for music. The impact has been that physical sales have declined and CD shops have had to go into business rescue.
A snapshot of the industry shows that revenue was sitting at 5.9%. There were 389 digital services that licensed up to 40 million songs; 50% of revenue in the foreign market came from digital sources and there were about 112 million subscribers from paid audio streaming services.

The music industry globally invests $ 4.5 billion in discovering, nurturing and promoting artists. However, in South Africa, the myth that international record labels make money in South Africa and then send all their money overseas instead of reinvesting it into the market was debunked by the three-year record of 2014, 2015 and 2016 which showed the reality of the true state of the revenue of international record companies in South Africa. The record showed that between 2014, 2015 and 2016, an average of 68% of the total revenue generated by international record labels remained in South Africa and was reinvested into recording, marketing and developing new talent and products for the South African industry and market.

Mr Sibisi continued by noting that RISA’s focus was on the aspects of the Bill that had a crippling effect on the recording industry. RISA welcomed the proposal of the Department of Trade and Industry (DTI) to ratify the treaties, as the purpose of the two treaties was to update the then WIPO treaties that were not in touch with technological development, and in effect modernizing the South African Copyright Act. The ratification of the treaty was important, as it has been required as a condition for entering reciprocal agreements with many collecting societies across the world. RISA was hopeful that ratification of the WIPO Performances and Phonograms Treaty (WPPT) would be fast tracked by DTI.

In terms of provisions that impact negatively on the recording industry, RISA noted that although it accepted the change in section 9(e) of the Act which gave communication to the public and ‘making available’ an exclusive right, it however, lamented the fact that those same rights have been downgraded under section 9(e).

RISA also had an issue with statutory limitations, as well as the Minister having the right to impose certain standard terms.

The sharing of royalties with users of the sound recording was also found to be unacceptable. Once a user has created content, such user stops being a user by the owner of content. Therefore the so-called user rights and users that share in royalties did not seem reasonable in RISA’s view.

In terms of the downgrading of communication to the public rights, it was pointed out that two treaties existed from an international context. One of which dealt with composers in the context of the music industry, that is song writers, musical works and literary works. The other dealt with performances and phonograms, which was where record companies stood. RISA opined that the drafters must have confused the use of terms as the WIPO Copyright Treaty (WCT) was used throughout in terms of combining ‘making available’ rights with communication to the public rights. Under WCT, these two rights were contained under one provision, whereas, they were separated and made exclusive under the WPPT. In terms of the provision in WPPT that dealt with sound recordings and performers, Article 10 of the WPPT gives an exclusive right of ‘making available’ to performers. In other words, performers under Article 10 have an exclusive right to make their performances available. On the other hand, Article 14 gives sound recording or record companies an exclusive ‘making available’ right. Separate to these two, Article 15 makes provision for communication to the public rights. It can therefore be seen that under WPPT, the international community, which includes South Africa, has made a decision to make communication to the public a single remuneration right, which includes both performers and record companies. However, the ‘making available’ right remained an exclusive right. The significance of these rights was that investments would only be recouped by record companies through the sale of recordings, and through the dilution of making available rights. This was regardless of the fact that there were other ways of investing in the industry. For instance, a joint venture where both the artist and the record company will contribute 50-50; and a licensing deal, where the artists own all of their work and license to the record company to distribute. Unfortunately, in many cases the artist’s deal is often chosen as a vehicle to record and distribute recordings. The consequence of this was that sharing of royalties would be different, as record companies do need to invest.

RISA therefore proposes that WPPT should be ratified and its provisions included in the Copyright Amendment Bill. It also proposed that there should be a separate section that would deal with the exclusive right of ‘making available’.

Xrystal Productions submission
Mr Geof Kirby, photographer at Xrystal Productions, explained that he was a working photographer, that has been faced with having to deal with the current copyright law and horrors that would be visited if the new Copyright Amendment Bill is implemented. Up until 1978, South Africa followed the UK example set by the 1965 Copyright Act. In 1978, the copyright law in South Africa was changed to allow all creators, irrespective of their specialty, possession of copyright; they became copyright holders. In 1980, ‘the cabal’, consisting of the advertising agencies, the magazine people, and probably the SABC, got together to change the 1978 Act, and the infamous section 21(1)(c) came into being. Section 21(1)(c) was highly discriminatory. Photographers were lumped in with this for a good reason, which was an economic reason.

Photographers, lithographers, painters making a portrait, cinematographers and the makers of sound recordings were specifically targeted for this special treatment. The revised 1980 Act provided that “where a person commissions the taking of a photograph, the painting or drawing of a portrait…, such persons shall, subject to the provisions of paragraph (b), be the owner of the copyright”. The problem with the provision was that as soon as a person is commissioned either remotely or by telephone call or through a physical interaction, by virtue of the commissioning procedure, the commissioning party owns copyright. This was hugely problematic, and has been inflicted on the photographic community much to their detriment.

Looking at the state of South Africa’s photographic industry and comparing it with other countries, developed or undeveloped, that of South Africa lags behind by ten to 15 years. It was hugely underdeveloped, due to the failure of economic benefits that flow from the commissioned works getting to the photographers. The current cost of equipment was huge and many photographers battled on with old equipment. This was unlike European countries with vibrant photographic industries.

Many challenged photographers have had to leave South Africa to forge a career in the kind of work that they love doing. For example, Sam Haskins said bluntly that one cannot make a living in South Africa. Another photographer spent half his time in Los Angeles and the other half in South Africa, for the exact same reason of one being unable to make a living in South Africa. Out of 192 countries globally, South Africa was only one of five that has retained the commissioning clause in section 21(1)(c). This was a legacy from apartheid.

Photographers have not been in a position when cases of serious abuses arise, due to insufficient funds. They are not in a position to sue, or take people to court, simply because of the lack of funds to do so.

Mr Kirby mentioned specifically the deliberate misinterpretation of section 21(1)(c) by corporate interests. A close look at the existing provision and the proposed one would show that section 21(1)(c) merely gives copyright in South Africa. The South African legislation only refers to work done here. There are records of a large number of cases of work being taken out of South Africa and syndicated to foreign interests. The money is being retained by those corporate interests and such moneys never get back to the photographers.
There has been a deliberate flouting of the international convention signed by South Africa. This deliberate misinterpretation has resulted in millions of rands being taken out of the photographic community to serve more narrow corporate interests.

There was a continuing struggle with the advertising agencies in South Africa. This was different from what obtained outside South Africa, as such advertising agencies would agree to the licensing structure of the country when sending their teams into South Africa.

The problems facing the photographic community in South Africa reflects the way photographers are being treated in terms of definition of an author within the Act, which is retained within the proposed amendment. In every other country in the world, the photographer is regarded as an artist. This was unlike section (a) on the definition of an author that includes photographers to mean a person who is responsible for the composition of the photograph. This definition is confusing in itself. However, it shows that somewhere along the line in 1980 or even before then, an underhand tactic to remove photographers from the definition of authorship was slipped in. Photographer’s commissions cannot therefore be authors. This also means they cannot possess copyright. Mr Kirby deemed this provision highly prejudicial.

As advertising agencies are aware that ideas cannot be copyrighted, and only the reduction of such ideas into physical format can be copyrighted, the framing of the definition in part (b) would exclude photographers from authorship benefits, and copyright ownership. Photographers are employed for a variety of reasons, other than the composition of the picture. More often than not, a photographer is employed because he has a good handle on how to deal with lighting or can orchestrate teams of models, hairdressers, and stylists.

Section 21(1)(c) as a legacy from the apartheid era is reflected in the following effects:
Firstly, it was anti-employment. For example in a case where a person employs a photographer, his company has to meet certain levels of expenses – pensions, medical schemes, equipment purchases, provision of studio space, insurances and so forth. All of this has a cost to company, to which a company gets access to copyright and ownership in fact as an employed photographer. On the other hand, a there could also be a freelance photographer who has to bear all these expenses himself and still get exactly the same access to copyright. The provision was anti-employment in the sense of considering which of the two options to choose from

Secondly, it involves an ‘asymmetrical power arrangement or power relationship’. This was because once a person has to negotiate the terms offered under a commissioning contract, the person is actually totally powerless without possession of copyright. The ownership of the copyright is absolutely crucial. There was an internationally accepted system called the licensing system that enabled photographers to benefit from the value of a picture based on the usage. Clients may treat the work of a photographer as a single one-off shot, but without the existence of a copyright, the same work is continually used without the photographer gaining access to the economic benefits.

The Chairperson interrupted to ask for the actual proposals to be made by Mr Kirby.

Mr Kirby replied that his proposals were to the effect that the reference to photographers in section 21(1)(b) should be struck out and the definition of author should be changed to conform to international standards.
He argued for photographers to be regarded in the same way as writers or anybody else creating materials within the creative industries.

Another common problem in the photographic industry endemic was the value of commission was under-declared by advertising agencies for their own benefit. There were many cases on record where photographers were asked to quote for the smallest job involved in magazines, only to find such pictures on billboards, without their getting paid for the returns on such viewership. However, such photographers cannot tackle the advertising agencies as they were without copyright.

The emerging black market comprised of people likely not to be fully acquainted with the Copyright Act and were the most likely to be prejudiced for the rest of their lives, as they had no catalogue of work that has been built up and which will pay back. This was because their work is owned by commercial corporate interests. People in this category needed protection. While emerging black markets in other industries received protection, such protection was not available in the photographic industry. However, this protection can only be given once section 21(1)(c) was struck out in respect of photographers, as this will ensure a level playing field for everybody.

As mentioned earlier, out of 192 countries, only five have a clause similar to South Africa. The result of the once-off buying of pictures was that such pictures were taken into picture libraries within the media houses, after which they would be marketed abroad. They are often syndicated abroad, and in many cases, there would be absolutely no return for the photographers. Such pictures are seen as a continuing asset. An example was given of one media house turning over in excess of R350 000 for a picture, none of which was returned to the photographer.

The ownership of copyright was crucial in the fight against abuse or unfair advantage. In other countries, a photographer would issue a license to cover and price a declared usage, because such photographer owned copyright.

Mr Kirby went on to highlight case studies to buttress his argument (see submission). For example, Sam Nzima did not own copyright of his famous picture of Hector Petersen. He fought hard to get copyright back and eventually did in 1998. However, in the 22 years when he did not own copyright, the picture earned an estimated R27 million globally, none of which was returned to Sam.

Mr Kirby noted magazines that basically take away all rights of a photographer globally in perpetuity. He spoke about a petition in 2015 with 2 557 signatures from the photographic industry which was sent to the DTI, but was ignored. The Amendment Bill proposal was worse than the existing section 21(1)(c), as it made ownership of copyright negotiable.

Mr Kalako commended the submission for being enlightening. He was shocked at the level of exploitation that photographers face. He was also displeased that the Department had done nothing to address the challenge raised by photographers, including the petition they submitted. DTI would have to explain the reasons for ignoring the plight of the photographers. The proposal made for the protection of photographers would be considered urgently.

Mr Williams asked Mr Kirby to clarify the repercussions of expunging photographers from section 21(1)(c), as well as what the fate of the categories of creative artists will be in that regard. He asked for proposals on how the exploitation of photographers by magazines can be curbed. He agreed with Mr Kalako on the need to address the position of photographers, particularly as the Amendment Bill makes no provision to directly address the plight of the photographers.

Mr Esterhuizen commented on the copyright changes for institutions that commission and fund a creative work. He believed that the copyright of a picture should belong to the creator of that picture. Photographers should have and should make use of their right to sue when their rights are abused.

Mr Macpherson asked RISA to explain the rationale for its proposal for extension of the duration under limiting assignment from 25 years to 70 years.

The Chairperson expressed concern about the department’s response to copyright concerns of photographers. She noted that an average of R1 million had been spent to ensure the right to use certain terms such as Rooibos tea remained a South African term. Something should be done about copyright for photographers. The picture of Hector Peterson for example, was iconic and had been used by the United Nations without consultation. The department was asked to look into this situation. In terms of the Amendment Bill, she noted that the proposal by Mr Kirby should be considered within a broader perspective that would take into account other categories of creative work, such as painters.

In terms of the submission made by RISA, She noted that most of the RISA proposals could be useful in deliberations on the Performers’ Protection Amendment Bill. She urged RISA to make its team available to engage on that Bill when the time comes.

She also acknowledged the importance of the submission made on emerging black photographers, and said everyone had a responsibility to bring about transformation.

Mr Kirby responded by noting that the story of Sam Nzima fully emerged in 2015 when the petition was being dealt with. A representative was sent to see him in Lillydale where he had retired and he gave an interview with his agent. It was from there that the discovery of the R27 million figure emerged. The lesson learnt from this was that poor photographers do not command respect. The Hector Petersen museum displayed the picture taken by Sam in 2004 but never paid Sam for it. This was an indictment.

The Chairperson asked for what has been done about this indictment and Mr Kirby replied that he could not do anything about it since it was Sam’s picture and Sam had copyright. He also had an agent. Hopefully, the agent would get him a lawyer and the case would be resolved in court.

Mr Kirby continued that he could only speak for photographers and no other category of creative artists. He noted that there was a system that worked globally (although not in South Africa) where the author of a creative work owned copyright and the usage of such work is governed by a licence. Launching this system would propel the creative industry of South Africa forward by 15 to 20 years. The licence was usually a very simple agreement, which could also be complicated. It falls under the law of contract. To address exploitation by magazines, photographers would need to own the bargaining power during negotiations. And this could only be possible if copyright was owned by those photographers.

The Chairperson asked for proposals in writing that the Committee can work with in securing copyright for photographers. She asked that Mr Kirby be prepared to reappear before the Committee.

On the SABC and ownership of rights by the state, Mr Sibisi said there has been a chorus of voices that the state should not own copyright of composers. Instead, composers should be left to own their copyright. RISA aligned itself with this position.

On the RISA proposal for an extension of duration to 70 years, Mr Sibisi said it was an international trend to move from 50 to 70 years. RISA has not debated internally on whether it should be pushing hard on this proposal. This explained why the proposal was mentioned only in passing in the submission, as there was still a need to build a proper case for it.

Media Monitoring Africa (MMA) submission
Mr William Bird, MMA Director, noted that the MMA submission has been endorsed by the South African National Editors’ forum (SANEF) and Caxton Media. Specific comments on the wording of clauses have been provided in the written submission.

He said that MMA was a non-benefit trust that has been operational since 1993. It was a human rights organisation that carried out most if its work on media, in a bid to encourage responsible quality media. SANEF was also a non-profit organisation that consisted largely of editors and journalists. It was committed to media freedom and diversity. It also campaigns for the elimination of legislation and commercial pressures that restrict media. Caxton Media publishes around 120 regional newspapers, including The Citizen and Moneyweb. It was committed to fair, honest and unbiased reporting on all its platforms.

In general terms, MMA welcomes the new, fair and practical limitations and exceptions in line with international practice. It however urged and recommended the ratification of the Marrakech Treaty.
One of its concerns was that the Amendment Bill did not adequately consider the application of copyright to digital media, and this presents some real challenges. It was also necessary to take into account the distribution and reproduction of work on social media.

There was also a need to consider the definition of computer program. MMA proposed that a technology neutral approach should be adopted. The unauthorized reproduction of news articles was also raised. MMA believes that there should be a review of the self-regulatory method of takedown notices as provided for in the Electronic Communications Act (ECA), as the Act did not adequately address the economic losses or swiftness of action. This was linked to the geographic nature of copyright protection, which was an issue.

The issue of public versus private, closed communities was also a concern. There was a need for clarity in defining ‘public’. This was in line with other submissions on the need for clear definition of terminologies.
Also, the rights of media should be protected to report unhindered on newsworthy events, as well as ensuring universal access and distribution for pictures, videos and other multimedia content such as traditional media. Some of the worst offenders of this were entities like FIFA, as it can be recalled that they did not only take over the stadiums when they came to South Africa, they also took over the entire country to launder money and steal copyright.

In terms of new challenges for copyright and digital media, MMA was of the view that the Bill was in need of a ‘software upgrade’. It was necessary to use more up to date technology-neutral terms. Gaps in the Bill would connote a failure to deal with emerging challenges. While MMA was in full support of fair use with some changes, it was concerned about plagiarism and repeated use of content. This was because of the overall impact to the bottom line, the undermining of the quality of journalism and the undermining of trust. While there was a Moneyweb case on plagiarism serving some of those limits, new solutions were needed nonetheless. For example, if a news organisation spends money on investigative journalism and they put in a lot of time and effort into publishing a story, a new site could go to the accredited source to copy out the story almost exactly word for word, and then reproduce the story without any form of accreditation. Such fake sites could have their domain registered in a number of places. It then becomes incredibly hard for organisations to do something about such a situation. At the moment, the Bill does not offer media organisations any real solutions to such situations.

There was also cross border violations. Reference was made to a particular person in South Africa who has a registered site elsewhere and steals content from a number of major media online publications but it was very hard to take action against this person.

The Chairperson asked for the name of the person being referred to.

Mr Bird replied that there were a number of people indulging in fake news publications. Mzanzi Live was one of the more popular ones that stole content. MMA was busy partnering with three major media houses to address issues of people taking their content without any form of appropriate accreditation or permission.

Another issue to be addressed in digital media was the definition of first point of publication. This was a real challenge for MMA and other user organisations, especially when considering the location or base of web servers. There was the question of what should be done about sites registered in other nations that make use of content from South Africa; how to deal with the speed of how fast information spreads; as well as forms of redress that could be sought.

On fair use, MMA proposed the addition of ‘such as’ to the introductory language in the new proposed general exception. It supported removing the second comma in section 12A(1)(a).
It welcomed the acknowledgment that fair use was the life blood of the news media. MMA believes that a fair use clause aligns copyright use with the freedom of expression and freedom of the media clauses in the Constitution. The implementation of the fair use principle in news supports and promotes the creative industries.

In the view of SANEF, fair use clauses were developed from principles adopted by the US Center for Media and Social Impact, which were specifically for newsrooms to guide acceptable reuse of content with the necessary attribution or acknowledgment. The principles considered the use of copyrighted material as proof or substantiation in news reporting or analysis; the use of copyrighted materials sometimes in order to prove actors as a valid source; use of copyrighted material in cultural reporting and criticism, for instance on entertainment reporting; use of copyrighted material as illustration in news reporting or analysis; use of copyrighted material as historical reference in news reporting or analysis; and other principles listed in submission.

In terms of protection of the news media’s fair use rights, intellectual property protection measures at major events of public interest often threaten legitimate news-gathering and news-distribution practices. This has been seen increasingly and has sometimes been driven by excuses around security but other times, around the absence of copyright to limit the media’s reporting and legitimate news gathering. For example, during the 2010 World Cup, there were a number of limitations that were specifically placed on the South African media. International sport bodies like FIFA and entertainment promoters often put restrictions on the coverage of newsworthy events under the guise of copyright protection. This was often enforced with accreditation conditions which make it very difficult for non-rights holders to provide fair and balanced coverage. Mechanisms were needed to protect fair use rights such as guaranteed news extraction rights.
The rights of news media should be protected to report unhindered by commercial and copyright provisions on newsworthy events, by ensuring universal news access and distribution rights for pictures, videos and other multimedia content by print, broadcast and online media. The news media needs such provisions to ensure they can report in line with the constitutionally guaranteed right to freedom of expression.

In terms of information held by the state, MMA strongly suggested that this provision should be removed, especially since the information was collected by public funds, and should therefore be held in the public domain for free use without copyright restrictions.

The Chairperson asked for clarity on the reference to ‘software upgrade’ in respect of the Bill.

Mr Esterhuizen said that copyright law was an important legal framework for addressing access to public information. He agreed with the submission that the media was being hindered by political instability and probably poor record keeping.

Mr Bird replied that the term “software upgrade” did not literally suggest the writing of software for the Bill neither did it suggest an entire redraft. However, there was a need for people with particular skills to look over the Bill and review the language around the use of technology terms, for example. It should also seek to address people stealing legitimate content, and the repercussions for such stolen content going across borders, as well as overall solutions for these problems. MMA engaged with many media organisations on the Bill and they were of the view that the Bill did not speak to solving the problems facing media organisations at the moment. This was problematic because the only tool in the arsenal of these organisations was the takedown notice, which although it may be effective to some degree, it was not something that serviced them appropriately. Although MMA had no specific proposals on solutions to these problems, it emphasized the need for the employment of people with the skills and expertise to consider these issues and come up with potential workable solutions.

In response to Mr Esterhuizen, he said that there were certain areas in terms of access being problematic. The South African government was one of the first signatories of the Open Government Partnership. The country can pride itself in the government’s generally positive relationship in providing open access to information but MMA was aware that many challenges existed around archives, national archives, and so on. Some of the records have not been properly kept. In terms of general media access to these, the media tends to access information by submitting PAIA requests and very often such items get delayed by people who would not like the media to find out about certain things. Inasmuch as South Africa has ensured a remarkably positive and progressive state response to information and how such information was being dealt with, there was still an increasing securitization of information, which posed a fundamental threat to media freedom.

The Chairperson asked for examples of technical terms that were inappropriate or inaccurately used in the Bill. She asked what gaps in the Bill was Mr Bird referring to and asked for examples to buttress the argument for fair use, whilst considering plagiarism and repeated use of content.

Mr Bird replied that an example of a technical term was ‘computer program’ which MMA believed should be amended to provide a technology neutral interpretation, as it was unclear whether the reference to computer program included website software applications and website applications. Experts should be employed to provide some of these technology neutral definitions in ensuring the Bill was in line with other pieces of legislation in existence.

One of the gaps around plagiarism was organisations producing content and such content being stolen because of the easiness of being able to steal content. MMA was of the view that since this spoke broadly to copyright theft, the Bill should provide some means and mechanism for redress. The issue was even more complicated as there was no clear provision with respect to digital platforms; where the first point of origin lies; what the first point of publication was; what would be done to a person that steals content for publishing on a website that was targeting South Africans, and so on. An example was the Pretoria Rekord which was closely aligned to names of some other community media, and which has its URL based in another jurisdiction, and was deliberately targeting a South African audience.

The issue with so-called fake news was that most of the information was actually true. It reflected a massive emerging trend where hundreds of articles are being stolen. MMA had a tool with which information could be analysed to find out similarities or differences between original articles and fake ones. This is what he meant when he said there were gaps in this Bill but media houses do not have the necessary expertise to find solutions to this phenomenon.

The Chairperson asked MMA to submit a detailed response in writing highlighting examples of gaps, as well as proposals to tackle them by 8 August.

Independent Music Performance Rights Association (IMPRA) submission
Mr Dodo Monamodi, IMPRA chairperson, introduced his team of scholars and leadership of the well transformed organisations that led the masses, which include Mr Maseko, chairperson of Association of Independent Record Companies (AIRCO); Mr Blondie Makhene, Secretary General of Music Performers Association of South Africa (MPASA); and Dr Matsapola, senior legal adviser. He gave background information on IMPRA and noted that it has three accredited collecting societies, of which two were collecting on behalf of needletime. The accredited societies were SAMPRA, IMPRA and SAMRO.

Mr Mandla Maseko, AIRCO chairperson, indicated that the South African music industry landscape has been a part of the very tough, painful cultural landscape of this country infused with the legacies littered by apartheid law. AIRCO welcomed the process under review and expressed hope that the process would assist in transforming the industry.

At the moment, there were two trade associations in the industry: RISA and AIRCO. The responsibilities of the two trade associations were to guide members who venture and invest in producing music as their business. AIRCO represented the small medium enterprises in the music industry. The PWC Entertainment and Media Outlook in 2014 showed that 74% of the music market of South Africa, in terms of music sales, fair play and royalty revenue was still owned by foreign-owned conglomerates that were trading in South Africa. The remaining 26% was shared amongst the over 5 000 independent record companies. Therefore the landscape has not changed.

AIRCO supported IMPRA, because of the need to consciously create laws that would allow for transformation, particularly as the majority of members represented by IMPRA were situated in rural areas and townships. Most of them invested in South African cultural music which maintained the identity and distinctiveness of South Africans. Unfortunately, the majority of these members do not have access to means of production, i.e. recording studios, manufacturing plants, distribution channels, broadcasting platforms, and retail stores. The function of AIRCO was to ensure that its members understood copyright in both composition and sound recording. It was important for members to understand this distinction in their own languages. This explained the presence of AIRCO champions in all provinces to ensure that people can understand and trade in the music industry

Mr Monamodi added that it was shocking to discover that out of ten recording companies in South Africa, nine of them were members of IMPRA’s counterpart – RISA.

Mr Blondie Makhene, Secretary General: MPASA, pointed out that he was 51 years of age and had been in the industry for 49 years. He was familiar with the workings of the industry as he had the opportunity while growing up to enter into offices of the industry. However, he was only part of the music sector and not the entire industry. He opined that the music sector was the provider to this flourishing industry. He had been opportune to meet and learn from people in the industry; people from SAMRO. He therefore resolved to establish a record company that would consider the musicians and actually work for the benefit of those musicians unlike what existed in some other record companies. Although the music sector was one that provided power to the industry, the sector was yet to be industrialized. IMPRA was therefore pushing for the decolonization of the minds of the South African people, as well as the minds of the government and even the administrators, towards a change of the status quo for the betterment of the people.

Mr Monamodi continued that IMPRA’s mission was to champion and lead transformation in the collective management of rights to fast track economic empowerment opportunities for local music producers and performers in all provinces of South Africa and where possible to also find ways of disentangling artists from unfair contractual obligations. It was for this reason that two chambers represented both the producers and the performers.

They outlined their concerns about the Amendment Bill (see submission).

The Chairperson noted that the Performers’ Protection Amendment Bill had gone through Cabinet and the Minister had begun calling for public comment. Considering what they had just presented, they may want to make these comments or something similar on that Bill.

Cultural and Creative Industry Federation of South Africa (CCIFSA) submission
Mr Tony Kgoroge, President: CCIFSA, noted that in 2009, President Zuma met with the creative industry in Sandton and through that, a cry came out that the creative cultural industries needed to organize themselves. It was this outcry that birthed CCIFSA. An interim committee was formed in 2014, and it included some of the organisations that have presented, including the CEO of RISA. The interim committee elected the current leadership in 2015. CCIFSA was established to organize the creative and cultural industry, as well as transform the creative cultural industries. Its conference was done under the watchful eye of the IEC democratically, but it was faced with the challenge of getting affiliates, which ordinarily should have been by national organizations. CCIFSA soon discovered that most of the national organisations did not have national footprint. Rather, they existed literally only within Johannesburg, and a few in Cape Town.

CCIFSA therefore went into provinces to organize provinces from wards to districts, to create a provincial profile. The aim was to ensure that no artist would be left out, irrespective of age or locality, and that each artist would be duly represented. It was confused by the claim of most organisations here of having national footprint. The sensitive question to be asked was on whose behalf such organisations were acting.

CCIFSA focused on addressing the changing skills required in the creative and cultural industries; improving access to the finance; creating cross-cultural fertilization; establishing links with other sectors such as the ICT, tourism, including joint initiatives to foster understanding across sectors and contribute to developing a more open, innovative and entrepreneurial mindset in the sector; facilitating the setting up of platforms and networks between all public and private stakeholders that were relevant to the creative and cultural industries; encouraging structured partnerships with social partners and training providers, including apprenticeship; promoting the recognition of qualifications in the informal and non-formal education and training relevant to the creative sector; improving investor readiness of the financial institutions and invest readiness of the creative cultural industries, as well as devising dedicated financial instruments, in particular guarantee schemes; testing new audience development strategies and business modules relevant in the digital environment; and supporting digitalization of cultural content and development of online platforms. He outlined eight major sectors within this industry and about 45 sub-sectors (see submission).

CCFISA’s primary comment on the Bill were as follows:
The definition of craft work should include the phrase ‘the making of decorative or practical objective objects by hand’, as this would broaden the definition to craft work that may not be specified in the definition.

On orphan works, CCIFSA welcomes the proposal to vest orphan works in the state in perpetuity. It was however concerned that nothing was said about the licence fees or royalties that would accrue to the state from the exploitation of orphan works. CCIFSA therefore recommended that a provision should be made for the proceeds of orphan works to be reinvested in the funeral and pension schemes for creative workers, as well as in the development and growth of the cultural and creative industry. It proposed the establishment of a cultural development fund that can fit within CCIFSA to cater for all creative and cultural industries. As have been seen, artists who despite their creative works have passed away without nothing, and for whom the organisation had to put money together to bury them.
On the amendment of section 5 of the Act, CCIFSA accepts that the state organs must own copyright in works fully funded by it. However, the proposed amendment does not distinguish between fully funded works and partially funded works. In CCIFSA’s view, ownership should be proportionally equal in respect to the contribution of the parties involved.

CCIFSA welcomes the proposed amendment to section 6 and suggests that some enforcement mechanism should be created to ensure compliance. It wondered if the section included craftworks, as it was not very clear on that.

Referring to section 7C of the draft Copyright Amendment Bill of 2015, CCIFSA welcomed the duration of the resale rights but urges the DTI to consider extending the rights from 50 to 70 years after the death of the creator. It believed that the DTI has the opportunity to consider a review of the duration of all copyrights. The argument for 70 years was based on a religious notion.

In section 9A, although CCIFSA understands the need to create a mechanism to ensure that broadcasters sought prior permission for the use of the sound recording, it believes that such a requirement will make it almost impossible for broadcasters to operate and may lead to broadcasters choosing a few recording companies to work with that can give them advanced permission to the exclusion of many independent record companies and artists. The unintended consequence of this proposed amendment was that section 9A would end up benefiting a few connected recording companies. CCIFSA believes however that broadcasters may as an example be forced to pay a minimum percentage to owners while parties negotiated the licence. An example could also be in broadcasters being forced to pay 3% in accordance with the judgment by the Supreme Court of Appeal in the National Association of Broadcasters v SAMPRA case, No 119 of 2013. The amendment formula must be done until matters were resolved by agreement or by the copyright tribunal or by the court. Consequently, CCIFSA recommended that the status quo should be maintained without the need for prior consent, provided that in circumstances where there was a dispute between broadcasters and owners of sound recordings on payment of royalties, the broadcasters should be forced to pay as proposed. Where owners of sound recordings are paid an amount pending the final determination of the rate, such owners (or where they are represented by a collecting society, such a collecting society) must pay 50% of the said amount to the relevant performers or their collecting societies less agreed administration fee.

The issue of collecting societies was a very sensitive one in the creative and cultural industry. The artists do not have confidence in the collecting societies. There was a lot of debate around the exact function of the collecting societies, and for whom such functions were carried out. There was a need for a lot of education to be directed at this. CCIFSA believed that broadcasters would continue to exploit artists if the law does not change the collecting societies. CCIFSA supported the regulation of collecting societies, to ensure that collecting societies made collections for registered members only, and not on behalf of non-members and deceased persons. No account has been given for the monies of deceased persons sitting in the bank accounts of collecting societies, or to what use such monies have been put. Collecting societies and broadcasters must be accountable. The DTI should be strict about this as there were artists who died poor which should not be so.

In terms of the all-important moral right in the Performer’s Protection Amendment Bill where artists are allowed to control their image, Mr Kgoroge cited an example of a contract he refused to sign with M-Net, because M-Net wanted to own performance rights in perpetuity. With the regard to the clause in the Copyright Amendment Bill, this becomes a problem for an advanced artist that performs on international platforms. Once the artist signs that contract, the company owns the artist’s right in perpetuity. The company can take the product of the artist and sell it internationally. This would lead to an overall loss of employment.
The Bill also seeks to put a stop to the separation of money in countries that do not pay needletime.

In section 9B, CCIFSA believes that the copyright of collecting societies must be registered and regulated under 9B to 9F, and should include those societies or organisations collecting repeat fees and royalties in the film and TV industries. CCIFSA was aware of the nonexistence of audiovisual collecting societies. It would engage with the DTI to ensure the establishment of collecting societies for audiovisuals.

Referring to the draft Copyright Amendment Bill of 2015, CCIFSA said it supports 100% section 10A and suggests that if its provisions are opposed by the broadcasters on the basis that they should be dealt with by ICASA and Department of Communications, such provisions should be discussed and incorporated into the license of broadcasters with the assistance of the DoC and ICASA.

In section 12, while CCIFSA understands the need to create exceptions to legitimate noncommercial uses, it believes that the creators and performers of literary and musical works should be compensated through a private copy levy. In many jurisdictions, private copy exceptions were inextricably linked to private copy levy. In this regard, it attaches an international levy on the private copy compensator.

In section 12A on the introduction of the private copy exception for sound recording, CCIFSA proposes that the DTI should seriously consider this proposal, especially if such private copying exceptions was not accompanied by private copy levy as is the case in Europe, US and in some parts of Africa such as Burkina Faso, Ivory Coast and Senegal. In many of these countries, it was recognized that the exception impacts on the revenue of artists. It was agreed that the introduction of private copy levy on all recordable media softens this blow and this levy was then used for the development of arts, pension funds, contributions for the artists, and related social security services. CCIFSA therefore strongly recommends the introduction of the private copy levy which would be used to ensure that South African artists do not die as paupers while their work was being copied freely, even if it was for private use.

In section 13A, CCIFA’s comment on the private copy applies to contemporary reproduction. It believes that a private copy levy must be introduced in exchange for these exceptions, otherwise the effect would be that it was denying its artists a livelihood under the difficult economic conditions. Many of the manufacturers of the blank recording media were paying a levy in Europe and the US and yet they sold these devices in South Africa without paying any levy. In the countries of origin, they are always happy to pay the levy because it goes towards the development of their culture. Yet such system is not applied in South Africa. The DTI must introduce a levy through this Bill.

With regard to section 13B, while CCIFSA believes that there should be some exception for the use of copyright protected works for educational purposes, it also believes that there should be some nominal compensation by institutions to encourage creators to continue creating the works.

Referring to section 20A and B of the draft Copyright Amendment Bill of 2015, CCIFSA said it welcomes the introduction of the Beijing Audiovisual Treaty provisions in the Bill and suggests that these rights should be administered collectively to increase the bargaining power of performers. The society should be regulated in the same way as the music related collecting societies.

CCIFSA welcomes the insertion of section 22A that provides some clarification on the return of the rights and the royalties of orphan works. What is still not clear is what happens to the fees if unclaimed for more than five years after the expiration of this licence. It suggests that a structure or the collecting societies should be established to license and receive royalties for orphan works, and such royalties if unclaimed should be rolled over to the cultural and development fund. CCIFSA also requests that no existing collecting society should be considered; instead new collecting societies should be established, as new players should come in to foster healthy competition.

CCIFSA supports the new section 29 that establishes the Intellectual Property Tribunal, on the condition that it will be established in relation to the work of the Federation, and recognises CCIFSA as the only custodian of the creative cultural industry in South Africa. CCIFSA believes this would ensure speedy resolutions in dispute and intellectual property matters. It believes that the tribunal should have powers that would include experienced practitioners in the relevant areas of IP, as well as copyright, trademark, designs, patterns, to assist the tribunal in making a determination.

On translation licences, the proposed provisions on the translations of works, published, printed or analogues form was welcomed. CCIFSA suggests that prior notice be given to the creator of the works.

Mr Williams raised a concern about section 22B(6), and the numerous submissions made in the last two days on the need for some degree of regulation of collecting societies. He asked for the views of both organisations on whether the non-removal of the section would undermine the regulation of the single collecting society that will be retained. He wanted to know how IMPRA and CCIFSA perceived the regulation of collecting societies and the removal of the section going forward.

Mr Esterhuizen said what was needed was a balance between the right of creators and owners of copyright. There was also a need for the provision of incentives for continual creation.

Ms S Van Schalkwyk (ANC) asked CCIFSA if it needed more time to canvass a proper mandate amongst its members and what the duration would be. This was important because the Committee would like to hear the voice of the people at ground level who would actually be affected. The Committee had no intention of rushing the process at the expense of addressing the issues of the people.

Mr S Mbuyane (ANC) said it was disturbing for the Committee to discover that 74% was owned by conglomerates outside the country. He proposed that going forward, submissions must be made on proposals for a turnaround strategy on issues such as this, to ensure that the masses benefited from the dividends of the country.

The Chairperson sought clarity on the IMPRA submission about the Amendment Bill being “a great error of our time that would serve to preserve past privilege and its legacy”. She commended CCIFSA’s specificity in its proposals on the Amendment Bill, and urged forthcoming presenters to take cognisance of this style of submission. She asked if CCIFSA had considered the work of creative people with disabilities in its proposed definition of craftwork.

Mr Monamodi replied that the comment about the Bill being “a great error of our time that would preserve past privilege and its legacy” meant that South Africa was still in a developmental stage in which it had three accredited collecting societies of which two were accredited for needletime. In the past, there were only two collecting societies, SAMPRA and SAMRO. It was important for the country to allow new players to ensure transformation of the regime. To force everyone to belong to one society would be a great error, as this would diminish the market leaving members without options to choose from. It also defeats the competition laws of the country, especially since competition was very healthy. The identification of such gaps suffered by producers and musicians was what birthed IMPRA in the first place. Those gaps were then utilized to create alternatives.

On whether section 22B(6) should be removed, Mr Maseko replied that collecting societies have been in existence for many years, since the formalization of the South African music industry. It was only in 2015 that a new collecting society was established, which was IMPRA. It was only after the establishment of a new collecting society that the proposal for a change in the law was brought forward, to foster the continued and pre-existing relationships with the current collecting societies. IMPRA’s stance on this was that DTI did not necessarily have to close down the market to ensure regulation of collecting societies. Instead, regulation would mean that DTI would be in charge of accreditation, accountability and monitoring of the activities of collecting societies, including the use of undistributed funds. The proposal by IMPRA was that the market should be opened up and be properly regulated to address unemployment and inequality, while serving as a medium to create jobs.

Mr Phemelo Sediti, Secretary General: CCIFSA noted that the country was going through a paradigm shift from having a few players dominating the creative industry to a more saturated industry. An example was the reference made by the Chairperson to the omission of people not using their hands for craftwork from the proposed definition of craftwork, which was not intended by CCIFSA.

Mr Sediti replied to Ms Van Schalkwyk, explaining that 31 July 2017 had been the deadline for submission of comments. The Department of Arts and Culture had taken two years (2015 and 2016) to get comments from the public. The implication of this was that CCIFSA had to speed up its process. However, it would submit a letter containing timeframes that were agreed upon.

On CCIFSA’s view of the regulation of collecting societies, Mr Kgoroge replied that he would consult with other sectors represented by CCIFSA to come up with an area of commonality that represents the views of those other sectors.

However, the issue of consultation raised by Ms Van Schalkwyk was problematic in his sector. CCIFSA was fighting against individuals that served their own interests. An example was the issue of fair use. He noted that the provision of fair use favoured the artists rather than broadcasters and other investors. This explained the opposition to the provision of fair use by investors and broadcasters. When CCIFSA was established, it created a tenth province in which national organisations for creative artists in all nine provinces would be represented. The rationale behind this was to make national organisations lead sectors that were relevant to them and in turn ensure a proper affiliation with CCIFSA. This goal however failed. Two years after the establishment of CCIFSA, it has been able to establish five provinces without the assistance of any national organisation, apart from those already affiliated to CCIFSA. CCIFSA also had a presence in the remaining four provinces, which comprised of the delegation to those provinces and ten general council members. It was for this reason that he held the view that the submissions of other organisations who stated they had a national footprint was untrue, as there was no proof of their membership across provinces and districts.

Dr Matsapola replied that IMPRA was not arguing for the removal of section 22B(6). Instead, it wants the section to read: “The Commission shall register collecting societies for each right or related right granted under the copyright”. IMPRA did not challenge the Commission to issue certificates to collecting societies nor did it propose requirements for the certification. The Commission could continue with its operations as long as people were not forced to belong to a certain collecting society.

Mr Makhene added that IMPRA was at a developmental stage and it had a duty to abide by the Act and develop. His constituency was of the opinion that one collecting society was an insult to the gains of the freedom of the people.

Mr Monamodi said that IMPRA would appreciate the total removal of section 22B(6) if such removal would not create any harm. This was because leaving it as is with the hope of canvassing a correct legal explanation for it may only result in creating more challenges. IMPRA believed that South Africa was not ready for such a clause.

The Chairperson referred to page 12 of the IMPRA submission, noting that it made the point that the essence of regulation did not lie in forcing artists to come together but rather in proper implementation and enforcement of existing laws. She asked IMPRA for a better explanation to be submitted in writing to the Committee. She asked other presenters to submit details of the membership constituents of their organisations. She highlighted IMPRA’s submission on the need for radical transformation in the industry. While recognizing the newness of CCIFSA as an organisation, she noted that the Portfolio Committee on Arts and Culture would be briefed on the areas highlighted by CCIFSA as that Committee had more expertise in such areas. However she expressed concern about CCIFSA’s assertion about being truly represented nationally. She asked if CCIFSA had communicated the insufficiency of the 30-day time limit for the submission of comments to the Department. She urged all organisations to continue to communicate with the Committee as issues arise.

The meeting was adjourned.

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