Copyright Amendment Bill: public hearings day 3

Meeting report

Chairperson’s opening remarks

The Chairperson said Copyright Amendment Bill’s objective was not only to bring it into alignment with international treaties, but also to ensure that copyright owners who in the past were not able to benefit from their creative works and contributions, would now get to benefit adequately from it. The Bill would also alleviate poverty among artists, as it would help them to get income from their art work.

Academic Non-Fiction Authors’ Association of South Africa (ANFASA)

Prof Sihawukele Ngubane, Chairman: ANFASA, said that ANFASA was the sole national authors’ association in South Africa. Its objectives included the promotion and protection of intellectual property rights of non-fiction authors in South Africa, and also to encourage their personal academic development. The ANFASA submissions to the Committee were as a result of contributions from Mr Winston Mohapi and Prof Keyan Tomaselli, among others. The submissions had been refined to focus on the core issues relating to the Bill, so as to give concrete recommendations.

Ms Monica Seeber, Treasurer: ANFASA said that during the consultation period, despite ANFASA making several proposals in the form of submissions to the Department of Trade and Industry (DTI) regarding changes to the Bill, each one of them had gone unaddressed. Nonetheless, ANFASA remained willing and committed to assist the Committee in any way necessary. The National Development Plan (NDP) aimed to eliminate poverty and reduce inequality and create jobs by 2030. Although writing may not necessarily create jobs, it created income for those who were not in formal employment.

A literate society leads to a more competent workforce. Despite the need for development through innovation, cultural development and creativity were the soul and heritage of the nation and were therefore an essential part of national cohesion. The wellbeing of authors was closely linked to the vibrancy of the book publishing industry. Good copyright law struck a balance between the economic rights of copyright owners and public interest. It was in the public interest that authors be given an enabling environment to pursue creativity. This would translate to availability and access of books for the public for research, and also for innovation. However, the Copyright Bill did not appreciate this balance of interests.

The Copyright Act needed to be updated as it dated from 1978. It needed to be consistent with the intellectual property (IP) policy document of 2013. However, since the policy was merely a draft, the Bill may not conform to it. The Act also needed to be in alignment with international treaties, but South Africa was yet to ratify the World Intellectual Property Organisation (WIPO) internet treaties of 1976 and the Marrakesh Treaty for the visually impaired, among others. The Bill also failed to protect authors’ economic rights and perpetuated the perception and fact that authors of creative works -- specifically authors of musical works -- were undervalued in society and should be enabled by law to receive adequate payment.

The amendment to the Copyright Act was greatly inspired by the fact that musicians were languishing in poverty. Despite their notoriety among the general public, a great number of authors had died without achieving any commercial success. In the Bill, performers of works used in sound recordings were advantaged due to an express provision entitling them to royalties, and the creators of artistic works benefited from the resale of royalty rights. Musicians had also been rewarded, but authors had not. Despite this, authors had been disadvantaged further through the addition of more exceptions to copyright under ‘fair use.’

Section 12 of the Copyright Act provides for a fair dealing exception, which allows the use of a copyright work for research, study or private use. However, the Bill brings about ‘fair use,’ which gives additional exceptions, including an exception for scholarship, teaching and education. In effect, this would strip copyright off school books for university education and in turn deprive due revenue to their authors, which they would have otherwise enjoyed. Authors who write in the indigenous languages were the ones who would lose the most, since their readership was small among the general public, and their sales depend heavily on sales to schools. Local branches of international brands may close, since their principals may stop supplying books to South Africa. This would lead to cut backs in jobs, leading to unemployment. The industry as a whole would be affected, as authors would find it hard to get publishers.

Authors suing any legal institution for copying would have to prove the absence of ‘fair use’ and also prove the extent of their loss calculated in royalties. The legal process and cost would be long and prohibitive respectively. The working of the Bill also allowed anyone to make copies of books for research, educational and academic activities, if the copies did not exceed the justification of the purpose. In effect, if the purpose required the copying of the whole book, it would be allowed. Educational institutions may incorporate these copies into course and study packs among others, in print and digitally. Higher education institutions had been using licensing, which had benefited both the author, who got royalties, and their users, who got access to the books and subsidised prices. The Bill, however, made this free from authorisation or payment.

The fair dealing exemption created specific circumstances in which copies may be made. However, fair use extended this circumstance under the rubric of public interest, even for commercial purposes. The more flexible the exceptions to copyright, the greater the risk that they would continue to be expanded by users in South Africa, and in the absence of domestic court decisions, South African courts would try to adopt USA decisions on fair use. This would compromise the prospects of an individual copyright owner succeeding in such as case, since litigants in the USA were funded by big corporations. The fair use exception had been forwarded by the US to developing countries as a means to stimulate innovation. However, the relationship between copyright flexibility in fair use and economic outcomes was yet to be proved. The only real beneficiaries of fair use, aside from foreign entities, would be the legal profession.

ANFASA recommended the ratification of the World Trade Organisation (WTO) and WIPO treaties, modifying them to suit domestic circumstances and then implementing them. The Bill could adopt a fair dealing approach similar to that of Australia, details of which would be submitted to the Committee in writing.

The Bill purports to make an author’s moral rights subject to limitations, such as in the use of educational purposes and fair use. The provision of moral rights was used to protect the copyrighted work from any form of distortion that was detrimental to the author’s reputation. The Bill’s limitation would allow for such works to be used, manipulated and distorted in many uncontemplated ways. Authors would not be able to challenge or take any action against such distortions.

The artist’s resale rights would benefit visual artists beyond the first sale of an artwork. With the public lending right (PLR), artists would be able to receive income from libraries lending their works to the public. Such payment would be made by the government as an act of partial compensation to the author for the reading of his works by many borrowers. However, this was not intended as a substitute for sales. PLR schemes were not new in Africa, as there were such schemes in Bukina Faso, Ethiopia, Kenya, Mauritius and Mozambique.

ANFASA recommended that the right to copy educational material freely and without permission be withdrawn. The introduction of fair use, promoted by American interests, should be interrogated as it would have a devastating effect on the writing and publishing industry. There should be a credible impact assessment done in order to enable an informed decision be made on the desirability of fair use. The benefit of PLR should also be investigated, and ANFASA offers to provide a drafting of the provision.

The Chairperson said that the presentations should be designed in a way that they identified the problematic provisions, explained why they may be objectionable and thereby provide a way forward. This would assist the discussions to be more constructive and productive.

South African Book Development Council (SABDC)

Ms Elitha van der Sandt, CEO, SABDC, said that the Council was a representative body of the South African book sector and included various stakeholders throughout the industry’s value chain. Despite the National Development Plan having the objective of promoting books and literaracy in South Africa, it remained silent on how exactly it would achieve this. The book sector remained a non-priority, as there were no government programmes to assist the growth of the industry. For example, the indigenous language books industry remained a non-funded mandate by the government.

Historically, the book industry was primarily geared towards the white population in South Africa. The SABDC had the objective of promoting South African literature throughout the country. Ownership, management and authorship still reflected this position, with 92% of the turnover coming from the large companies and only 8% coming from small and medium enterprises (SMEs). SABDC with its members had, however, been working to ensure a more inclusive industry.

Africa should be producing its own stories and growing its indigenous market. The aim of the SABDC was to create a sustainable, locally-owned, black-owned industry that could meet the country’s diverse needs. This could be effected through an increase in black representation among authors, editors, publishing companies and sellers.

The Bill needed clearer definitions of the terms ‘user’ and ‘producer’ in order to include other persons, since despite the advancement of technology, it took more than the author to create and publish the book. The Bill needed to ensure the increased development and racial diversity of the creators in the book industry, to ensure sustainable development. Local creations should be stimulated and protected to ensure that there was steady knowledge production in the country. There should be a balance between local productions and imports so as to avoid making South Africa dependent on foreign books.

The Chairperson said that the socio-economic impact assessment report may be obtained by requesting the DTI for a copy.

South African National Council for the Blind (SANCB)

Mr Jace Nair, CEO, SANCB, asked the Committee to support the WIPO Treaty’s provisions regarding print for disabled people in order to enable visually impaired persons to access literature material. People throughout the country had had unfettered access to books and other literature which had enabled them to contribute to the economy. However, visually impaired persons had had limited access to books due to inaccessible formats of newspapers, magazines and PDF (Portable Document Format). The World Blind Union survey in 2009 had established that 5% of published works were accessible in developed countries. However, South Africa had been estimated as having only 0.1%, mainly in English, some in Afrikaans and a negligible fraction in indigenous languages. Most of these publications were published by non-governmental organizations (NGOs).

Some of the challenges these NGOs had been facing were delays in acquiring the licence for reproduction, and a lack of electronic files, creating the need for hiring data typists to reproduce the works manually. This had translated to additional time and increased costs during reproduction. The availability of files in electronic format would help in the reduction of reproduction costs and the need for labour resources,

Statistics had shown that 11% of the national population had sight impairment, 32% of whom were persons living with disabilities. 80% of these people lived in rural areas, with 97% of them being unemployed. The impact of the lack of literature in accessible formats had led to an increase in the levels of illiteracy and low levels of education, low levels of skills and high levels of unemployment. Visually impaired persons had limited access to local and national libraries as well.

Despite the Marrakesh Treaty being adopted on 27 June 2013 and coming into force on 30 September 2016, with six African countries already ratifying it, South Africa was yet to ratify it. The aim of the treaty was to ensure the accessibility of persons with disability to print material. Accessible formats were defined as including Braille, audio, large print, daisy and e-copy formats. The treaty encouraged publishers to produce their books in blind-accessible formats so as to alleviate the burden of NGOs in reproducing them in those formats.

Articles 4, 30, 32 and 33 of the United Nations Convention on the Rights of Persons with Disabilities (CRPD) state the obligation to create an enabling environment for the disabled. The SANCB urges the Committee to ratify the Marrakesh Treaty and to harmonise existing legislation with international treaties. This would ensure the existence of systems for content development and production guidelines.

Discussion

Mr A Williams (ANC) asked ANFASA whether the Bill would be agreeable if the ‘fair use’ exemption clause in section 10 (4) of the Bill were removed. Also, what would be a better alternative clause that would allow access to affordable teaching material? He asked the DTI whether the Portfolio Committee on Trade and Industry was the relevant Committee in charge of ratifying the Marrakesh Treaty, and if it was, what the procedure for ratifying it was.

Mr D Macpherson (DA) asked ANFASA whether the government’s recently approved IP policy, which was in the Gazette for public comment, had had any impact on the ongoing discussions on the Bill. 

Ms S van Schalkwyk (ANC) requested that all institutions making submissions to the Committee on behalf of their member bodies should provide a list of those members, to allow the Committee to look at the transformation in those bodies as well.

The Chairperson said that the Copyright Bill’s technical objective was to be in line with the international treaties, since the 1978 Copyright Act had been enacted at a time when international treaties, such as the Marrakesh Treaty, were yet to be enacted. She reiterated that the presentations should be geared towards making contributions to the Bill. She asked the SANCB whether there were any books available to its members in any of the mobile libraries. She requested ANFASA to respond, in writing, as to whether they supported other authors -- those who were not non-fiction authors. The Bill would not be enacting provisions from foreign legislation, but only sought to draw inspiration from comparisons with other jurisdictions.

Mr Nair said that South Africa had always taken a leading role on human rights issues, and it should therefore ratify the Marrakesh Treaty. The DTI had given an indication that Parliament would have to enact the Copyright Amendment Bill in order to ratify the Marrakesh Treaty, but if there were delays in the Bill’s enactment, the DTI should consider ratifying the treaty in the meantime, so as to allow access to books for blind people, both nationally and internationally. The South African library for the blind had an arrangement with libraries in the provinces, but this endeavor was limited since it operated using the postal service.

The Chairperson said that it was not Parliament that was dragging its heels in ratifying, but it was rather the procedure that was demanding. At times one may agree in principle with a treaty, but once the treaty was translated, it did not reflect anything previously agreed upon.

Mr MacDonald Netshitenzhe, Acting Deputy-Director General (ADDG), DTI, said that the Department needed to be cautious in ratifying international instruments. For example, Botswana had ratified the WIPO Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT), but had lacked the domestic implementation tools. Parliament was the only state organ that could ratify treaties, but it had to agree on the substance and form of the treaty.

Prof Ngubane, said that ANFASA was the only national authors’ association, representing about 500 non-fiction authors, and including fiction writers as well.

Ms Seeber said that section 10(4) relating to scholarship, teaching and education, was but one of several other words used that collectively constitute ‘fair use.’ The whole provision should be rethought. Books were made as affordable as possible, considering the cost incurred during their production and after publishing.

International Federation of Film Producers Association (FIAPF)

Mr Mulia Grant, FIAPF, said that the Association was a non-profit organisation that represented 38 national film producer organisations in 31 countries. So far, FIAPF had looked into the South African audio-visual sector in effort to understand how better it could contribute to the NDP, and create employment opportunities and infrastructure development. It supported the proposed recommendations of the WCT and WPPT, the Marrakesh Treaty and the Beijing Treaty on audio-visual works.

Film production was a high risk and cost intensive project, since most of the costs had to be paid upfront without any guarantee of market success. It involved the purchase of underlying works in order to develop a screen play and film. Its revenue therefore could not just be considered as revenues for the individual actors, but as a return on investment. Some film productions either made losses or struggled to make any meaningful profit after their market launch. This level of risk precluded SMEs in the film industry from having easy access to capital.

Films, however, acted as an essential cultural development tool and needed to be nurtured in an enabling environment so as to remedy their market failures. Other countries had initiated skills development strategies and given film production incentives, among others.

Ms Marian Grant, FIAPF, said the film production industry offered a wide array of job opportunities which, in partnership with the government, could create meaningful employment to many people. In the United Kingdom, in example, the film production industry had taken precedence in the Brexit talks negotiating trade agreements.

Mr Grant emphasised that there needed to be systems in place to enable better quality of films to be produced, which would create good export markets worldwide. Such an enabling environment should enable film producers to be protected, and to exploit their intellectual property rights. Among the contributing factors to be considered for good economic growth was copyright licensing, remuneration models and access to copyright works. Copyright licensing would involve the transfer of an author’s economic rights to the film producer, so that the producers could benefit from the revenues thereafter. However, state ownership, as envisaged in the Bill, appeared to be overreaching and should be limited to only public information films. The limitation of the subsistence of copyright to 25 years may also deprive the industry of time for a return on investment.

Discussion

Mr Williams expressed concern that the FIAPF did not represent any South African firms, and had a presence in Africa in only Egypt, yet they had implied they acted in the interests of the public. The Committee should therefore be concerned as legislators about which public interest the FIAPF was trying to influence.

South African Guild of Actors (SAGA)

Ms Carlynn de Waal-Smit, National Secretary, SAGA, said that the Copyright Act in its current form was flawed to the extent that it threatened the livelihoods of actors and the industry as a whole. She implored the Committee to consider the plight of many actors who would suffer the unintended consequences of the Bill.

Mr Jack Devnarain, National Chairperson, SAGA, said that SAGA’s mandate was to protect the legal, economic and moral rights of actors. Many renowned actors never found success with the support of the industry, and were recognised and appreciated when only it was convenient. Their work continued to be exploited without any financial benefit going back to the actors or their respective estates. This had been brought about by the continued use of outdated models of exploitation and exclusion in the industry.

The Copyright Bill would address the various inequalities that ailed the industry. Performers had been paid only for their performances, whereas others continued to benefit from the exploitation of their works. The Bill would grant performers the ability to participate in an inclusive economy, which was one of the goals of the NDP.

Despite performers’ rights being contained in contracts, the negotiations of these various contracts were not achieved equitably. Actors as independent contractors did not benefit from collective bargaining schemes in order to establish industry norms and standards. Performers were therefore most often than not coerced into ceding their exclusive rights in order to get meaningful roles in films. Performers had been forced to rely on the generosity of broadcasters for remuneration for their performances. Some of these contracts had been perpetrated by the likes of Mnet, Moonlight and the SABC, among others. Despite these contracts being fixed and non-negotiable, they contained clauses that purported to imply the performers’ voluntary consent.

Other broadcasters had adopted similar contracts, with amendments and modifications, often to the detriment of the performer. In the advent of new media platforms such as YouTube, despite producers benefiting from revenue from these new platforms, performers had never been engaged to negotiate terms of remuneration. These barriers to income acted as a prohibiting factor in incentivising the youth to join the industry.

The Bill would introduce a statutory mechanism for performers to negotiate and secure their economic rights in the continued exploitation of their works. Performers would have the right to authorise the fixation and communication to the public of their live performances. However, the Bill needed to make a distinction between phonographic and audio-visual fixations in order to permit remunerative rights to audio visual performers. It should adopt the definitions contained in the WIPO Beijing Treaty. The definition of Collective Managing Organisations (CMOs) for audio visual performers should also be defined. There should be a dedicated authority mandate to collect royalties on behalf of these performers, and it should be subject to oversight for accountability. There should also be CMOs per category of right holders as opposed to one that collected for each right. CMOs should also get to decide on the justifiable expenses to be deducted in respect of their fees. This ceiling should be defined by an agreed percentage of the fees collected.

South African Screen Federation (SASFED)

Mr Marc Schwinges, Treasurer, SASFED, said that the entity was a national federation of film and audio-visual production industries in South Africa. It supported thousands of freelancers and other affiliates through organisations which were members of SASFED. It advocated for the adequate protection of works in the digital age, since copyright and related rights were powerful incentives in the industry. Strong copyright protection would contribute to South Africa’s content competitiveness as a base for international productions.

However, the Bill as presently drafted may weaken the incentive for the audio-visual industry to create and distribute content. Section 21(b) of the Bill and section 22 of the Act, limiting the duration of protection to 25 years, was an unwarranted limitation to contractual freedom. As a result, it would make content providers prefer other countries without this limitation.

Further, although most of the movies were funded by the state, the Bill proposed that copyright ownership be transferred to the state. This would deter private investors from investing in the production process, as it would diminish their claim to the ownership. SASFED proposed that there be a revision of the phrases used in the clause in order to solve the problem.

Despite the new Bill providing for the criminalsation of circumvention of technological protection measures, without encryption online piracy still would remain a threat to audiovisual works.

Discussion

Mr Williams commented that SAGA had presented on issues relating to the Performers’ Protection Amendment Bill, which was not yet before the Committee, and requested that they present the same when the Committee deliberated on the Bill. He asked SASFED for clarity on what the effect of the removal of section 21 (1)(c) of the Act would be.

Mr Macpherson said that it was odd that the SABC, as a public broadcaster, was not making any direct presentation to the Committee on the Bill. It would be of value if an invitation were to be extended to them to do so. He also enquired on the threat posed to international film makers if the Bill were passed as it was, and how the Bill stood in comparison to other similar legislation in countries other than the USA.

Ms Van Schalkwyk asked SAGA to elaborate on how the film industry had failed to transform, and also to make proposals on how the industry could reform. Also, what were the current status and practices of collecting agencies, and how did it affect actors’ performances?

Mr Adrian Galley, Vice Chairperson, SAGA, said that SAGA had already made written submissions on both the Copyright Amendment Bill and the Performers’ Protection Amendment Bill. Since each Act gave representation to the other, it would be difficult to ignore SAGA’s presentation entirely.

Mr Grant said that the FIAPF was also represented in Nigeria. It had made its representations to the Committee in good faith. Regarding state ownership in other jurisdictions, the UK limited state owners to very specific scenarios which were guided by public interest, for example.

Ms said that in order for the production industry to thrive, there needed to be a strong legal framework and an enabling environment for investment.

Mr Schwinges said section 21(1)(a) of the Act assumed that the rights to the works would always rest with the owner -- that was the producers and the directors of the works, as opposed to the broadcasters.

Mr Devnarain said performers fell outside the ambit of the Labour Act and as independent contractors, were governed under the law of contract. As such, they could not form labour unions to represent them collectively. The industry had failed to transform, despite the existence of a robust Bill of Rights and the economic policies in the NDP. The Bill would assist in the transformation of the industry by creating provisions guaranteeing statutory rights of performers which would provide the basis of informing future contracts.

A delegate from SAGA said that currently actors did not have rights to their image, and there was no CMO that collected fees on their behalf. The only existing CMO in South Africa was for musicians. However, SAGA, as part of FIA (International Federation of Actors), was working towards developing a CMO model which could be applied to South African audio-visual performers. Without a change in legislation, actors would be forced to continue to rely on unfair and exploitative contracts.

The Chairperson said that Parliament had received SAGA’s submission on both Bills, and these would be availed to the Members of the Committee in due time. She asked SASFED to explain why section 21(1)(c) of the Act should be removed for cinematographic film.

Mr Schwinges replied that the removal of section 21(1)(c) of the Act would put the default position back to the creator of the work, and create a balance between broadcasters and producers.

National Association of Broadcasters (NAB)

Ms Nadia Bulbulia, Executive Director, NAB, said that the NAB was a voluntary association of three tiers of broadcasting -- signal providers, industry organiszations and sector professionals. Its mandate was to ensure that its members adhered to the code of conduct for broadcasters, among others. It remained committed to ensure the economic growth and sustainability of artists in the creative industry through the payment of meaningful royalties for their works.

The Copyright Act must be certain, practical and aligned to international treaties. Although NAB supported the general aims of the Bill, it had concerns over its practical implementation. One of its concerns was the powers of the Minister of Trade and Industry to regulate content. This appeared to be in conflict with Article 192 of the constitution, which provided for an independent authority to regulate broadcasts. The Independent Communications Authority of South Africa (ICASA) was the only authority that was mandated to grant licences for radio and television services, and to determine local content.

Regarding royalties, broadcasters entered into licence agreements with collecting societies to permit use of copyrighted works in their repertoire. However, clause 9A of the Bill sought to introduce the need for prior consent from the copyright owner each time a work was broadcast. This was impractical in the current dynamics of broadcasting. As a result, broadcasters would be deterred from using artists’ works, leading to the unintended consequence of less exposure and fewer royalties.

The regulation of collecting societies (CS) goes beyond the scope of the Bill, and the CS Regulations (GG 28894 of June 2006) should be strengthened in the public interest.

Mr Aynon Doyle, Member Representative, NAB, said that Multi-Choice had already made submissions on the constitutional issues surrounding the Bill, and these were to be referred to the state law advisor.

Ms Aalia Manie, of Webber Wentzel, said that the major concern regarding state-funded copyright was related to the interpretation of the phrases ‘funded by the state’ and ‘local and international organisations’. There needed to be clarity on the material threshold of funding that would render the whole work to be owned by the state, and what kind of funding would constitute ‘funding by the state’ under the Act. There appeared to be no provision for negotiation with the state for parties to contract out of this provision. The provision was far reaching, and should either be revised or deleted in its entirety.

The Bill also prohibited the assignment of copyright owned or under the custody of the state, regardless of potential commercial opportunities to generate revenue. This would, in effect, reduce the incentive and create unwillingness to contract with the state. There should be mechanisms developed to mitigate the adverse economic impact.

The 25-year restriction in the Bill was too far reaching and should be removed, since it limited the commercial exploitation of copyright and made South Africa undesirable. Regarding orphan works, the Bill vested their ownership in the state. This made orphan works fall under the ambit of state-owned copyright and created a potential legal conflict whereby the owner of the work was located after the fact and needed the state to assign them the rights. The provision should provide that the beneficiaries of orphan works, where the author had died, be relatives of the deceased.

The scope of application of Section 9B of the Bill relating to artists’ resale royalty rights was unclear. In its current form, resale royalty rights were impractical and may be counterproductive in the South African context. Residual royalties also posed a practicality challenge in situations where there were multiple producers of copyrighted works, who each would have a claim to an equal portion of the royalty payable.

Schedule 2 Part A of the Bill provided that a non-exclusive, transferable translation licence may be granted under certain circumstances by the Tribunal, where such a licence had been denied by the copyright owner. However, these circumstances had already been envisaged under the permissible uses already contained in the copyright work, and the copyright owner should retain the right to deny access to their work for any reason.

Library and Information Association of South Africa (LIASA)

Ms Denise Nicholson, Scholarly Communications Librarian at the University of the Witwatersrand, Johannesburg, and official representative for LIASA, said that most copyrighted works were based on, and derived from, the works of others. Copyright protection was granted for only a limited period of time, and thereafter the works fell under the public domain and were used as a building block for new knowledge. This was why the Copyright Amendment Bill strived to create a balance between copyright owners and users.

Libraries and archives were key players, as they collect and preserve the cultural heritage and enable creators of works to use and re-use their collections for new creations. The result of a broken copyright system was deeper inequalities in public knowledge and skills, and prevented access to information for future generations. Strict copyright laws, without creating a balance between owner and user rights, only led to high levels of infringement.

The Copyright Act was outdated in the digital world, and contained restrictive provisions that, for example, did not recognise format shifting and backup copies. South Africa should learn from other jurisdictions, where developed regimes for copyright had succeeded. The evolution of technology made a ‘fair use’ regime an inevitable resort. The Bill encompassed provisions that were in line with international treaties and conventions, and South Africa should therefore embrace these regimes since they had been tried and tested. Limitations and exceptions in the Bill for libraries and archives would facilitate access to information.  Contract terms that override exceptions to copyright would be unenforceable.

A ‘fair use’ regime would enable resource sharing and allow for a more robust public domain. This would translate to better access to works which could be used as building blocks for new works. The fair use provisions in the Bill would allow educational institutions to be empowered to provide relevant and adequate research from international and local resources. Money saved from reprographic licensing fees could be used for the purchase of new books and resources. A fair use regime would facilitate access to knowledge.

State ownership of orphan works was not advisable, as it was impractical, expensive and would render works inaccessible. Libraries, archives and museums house orphan works in all formats and these need to be made accessible. Fair use would provide a solution.

There was no empirical evidence to show that a ‘fair use’ regime destroyed copyright industries. On the contrary, fair use contributed trillions of dollars to the USA economy.  Institutions and libraries are often subjected to publisher practices, such as ‘double dipping,’ whereby large multinational corporations secured exclusive licences of copyrighted works under highly priced subscriptions and then charged article processing charges to authors from the same institutions.

Discussion

Mr Williams asked the NAB whether the redrafting of the provision relating to state-funded copyright, and replacing the word ‘or’ with ‘and’, would make the provision agreeable. He asked LIASA whether the inclusion of the phrase ‘such as’ in the ‘fair use’ clause would address the issue of open fair use.

Mr Macpherson asked the NAB for more information on the transferable licence being issued by the tribunal. He asked LIASA how a wide non-restrictive provision for the use of copyrighted works would motivate authors to create and invest in copyright.

The Chairperson said that section 9A, as read with section 9B, referred to artistic works. She requested clarification on whether the resale royalty rights referred to in the presentation were with reference to the provisions of the Act, or the Bill.

Ms Manie said that the fees for the translation licences given by the tribunal should be determined by the tribunal. The definition of artistic works should also be defined to elaborate on its intended scope.

Mr Doyle said that there were concerns regarding when a work, funded by the state, would be available to the public domain.

Ms Nicholson said that the addition of the phrase ‘such as’ would open up the provision to other uses which were not contemplated at this time.

The Chairperson was concerned that when she had  repeatedly asked google if it had funded any previous speakers or those who had come during the public hearings, it had said only the NMA. However, that had not appeared to be the case, from Mr. Sean Flynn's own CV as he had listed receiving funding from google, for a number of papers listed below, and the papers listed below had been, ' The economic impact of copyright', Limitations and exceptions 2014 and 2017, global expert network on copyright limitations and exceptions, open society foundations 2011-2014 and Strengthening the Knowledge for public interest intellectual property policy IDRC Google 2010- 2013.

She said Hon Macpherson had raised it with her and thought that as it had been raised publicly, he found the non-disclosure problematic. As she had said she would make a ruling on that day, her ruling was that she would  write on behalf of the committee, requesting clarity from google on the matter.

Mr Macpherson: thanked the chairperson, noting that they had wanted to know on what basis people were before the committee; if they had been funded to advance a particular position which was  why his party had had an issue that the disclosure had not been given and they would also await on the FXI list of people that FXI had funded to appear at the hearing.

Mr Williams proposed that every presenter before the Committee should disclose whether they had been paid by anybody or organisation to advance a particular point of view to the Committee.

The Chairperson said that the disclosure should also include whether the presenters had been funded by other presenters before the Committee to support a particular view.

Spoor and Fisher

Mr Herman Blignaut, Attorney and Partner, Spoor & Fisher, said that Spoor & Fisher was an IP law firm that specialised exclusively in intellectual property. It had no interest in the amendments, other than ensuring their legitimate and practical applicability. Copyright law had been developed by courts of law, and such precedents should not be ignored in the discussions of the amendment Bill. Sections 4(c) and 5 (c) of the Bill were wrong in law, since it was only the owner of the work, and not the user of the work, that should be entitled to royalties, and also to have the right to transfer the work.

The scope of the resale royalty rights of artistic works should be clarified, as a broad interpretation of what entailed an artistic work could be interpreted to include works of architecture such as buildings, thereby creating the impression that every sale of such properties would incur royalty fees due to the builders.

Section 9E (1) of the Bill relating to the criminalisation of an assignment or waiver of such rights, was unnecessary since such a right had already been determined as inalienable. Section 9F(2) referred to the transfer of authorship in a work. Only ownership in a work could be transferred, as authorship remains an alienable right as well.

Section 13B relating to the freedom to copy for educational activities appeared too broad. Free copying without compensation to authors may discourage future investment in copyright relating to educational materials.

The limitation of assignment of copyright to 25 years was problematic, as it applied to all categories of copyright and did not explain the legislation’s intent after the expiry of the 25-year term. It also created an undue limitation on parties’ freedom to contract. The procedure of obtaining a licence in relation to an orphan work was extremely onerous and would in effect be prohibitively expensive. The provisions should be reconsidered to make it efficient and cost effective.

American Chamber of Commerce in South Africa (AmCham)

Ms Carol O’Brien, Executive Director, AmCham, said that the Chamber’s primary focus was US investment in South Africa. Although companies operating under AmCham were US companies, they employed South Africans. It was untrue that the adoption of a ‘fair use’ regime would give the USA a competitive interest in the world. It was in AmCham’s interest that South Africa got a world class standard of legislation.

Mr Waldo Steyn, Director and attorney, ENSafrica, said AmCham’s interest was to make South Africa attractive for foreign investment. Inadequate protection of intellectual property rights would discourage foreign investments. AmCham was interested in ensuring that the intellectual property acquired from South African citizens and service providers was protected, and that the fundamental rights associated by ownership of those rights was respected. Section 3 of the Bill defining the terms ‘funded by’ were not clear enough. The term should be expressly defined so as to clarify whether it included indirect funding as well. The proposed amendment to section 5 of the Act departed from the main aim of the protection and utilization of state-funded works for the benefit of the public.

Section 12 (1)(b) of the Bill proposed a ‘fair use’ regime. It was unclear whether the Bill sought to operate both the ‘fair use’ and the ‘fair dealing’ regime. This uncertainty brought about potential conflict and risk of numerous litigations. A fair dealing regime created some form of certainty, since it operated in a restrictive manner as opposed to ‘fair use,’ which suggested more flexibility. With the fair use doctrine being a US concept, it was likely South Africa would rely on USA-decided cases for direction in interpreting the application of the doctrine.

The way forward for South Africa would be to adopt a legal framework that provided more clarity and predictability, and the appointment of a team of experts to address the challenges in the present draft. 

Innovus Stellenbosch University

Mr Roux de Villiers, Innovus Stellenbosch University, said that Innovus was the business development arm of the university. Technology differed from other economic resources, since it did not deplete but built on existing technology. Most of the top drivers of innovation, partly funded by the state, were universities and research institutions. Although the Bill appreciated works of information and creative works, it failed to appreciate the nature of works with a technical, utilitarian function. The 25-year assignment right would be inhibitive to software development businesses, since such businesses build up on their original source codes, which were covered by copyright. Copyright as an incentive-based structure, incentivises innovation by creating a monopoly. However, an author’s right to monopoly needed to be balanced to a user’s right to access to such works. The Bill had transboundary implications, and could not be isolated from the norms of other jurisdictions, as this would disadvantage South African copyright hHolders.

The principle of national treatment obliged states to offer protection to foreign copyrighted works equal to its own. This may be detrimental to the local copyright industry, however, since it would have to compete with foreign imports. Copyright was fundamental to the technology industry, as its monopoly laws inspired the growth of technology business.

The scope of application of the Bill was limiting in the technology industry, and as it was impractical to have reversionary rights in software, the provision should be reconsidered. The provision relating to state-funded copyright should also be removed or redrafted.

Discussion

Mr Macpherson asked AmCham what the likely implications would be on USA’s investment in South Africa if the Bill were to go forward as it was.

Ms L Theko (ANC) said that the Copyright Act should be looked at from a global perspective, and not only a national perspective.

The Chairperson asked Spoor and Fisher to provide a further written explanation on their points presented to the Committee.

Ms Anita Nel, Director, Innovus Stellenbosch University, said that although foreign companies coming into South Africa did not necessarily ask about copyright, they were highly invested in technology and innovation.

Mr De Villiers said that the significance of copyright could not be emphasised enough in the technology industry. The Bill should be drafted with the economic implications having been considered.

Mr Macpherson asked Innovus whether there were any projects currently being worked on that would be affected negatively by the Bill

Mr Roux de Villiers, Innovus Stellenbosch university, said that any business that was predominantly based on technology would be negatively affected if the Bill passes as it were.

Mr A Williams (ANC) asked whether the provision for limiting the assignment period of copyrighted works, would be remedied by creating exemption clauses in the provision.

Mr De Villiers said that the provision could indeed be remedied by limiting the scope of its application to the relevant categories of works to which it was intended to apply.

The Chairperson concluded that the Committee would strive to get more representations on the Bill in order to produce a robust piece of legislation.

The meeting was adjourned.