Copyright Amendment Bill: deliberations

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Trade and Industry

07 November 2018
Chairperson: Mr D Mahlobo (ANC) (Acting)
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Meeting Summary

The intention of the meeting had been to review a legal opinion on the constitutionality of the Copyright Amendment Bill and for the Senior Legal Advisor to take the Portfolio Committee on Trade and Industry through the Copyright Amendment Bill, clause by clause, for an in-principle agreement on each clause.

However, the legal opinion was not ready and would only be available on 13 November because there had been some issues regarding constitutional implications. The Committee addressed all clauses and sections, except those that were dependent on the legal opinion: Clause 3 – whole clause; Clause 5 section (7); Clause 7 section (7)(a)(7); Clause section 9(5); Clause 6 – editing; Clause 13- whole clause; Clause 22 section (22)(b) which was linked to Clause 3; Clause 23 section 23(b).

The Senior Legal Advisor, supported by the Department of Trade and Industry, briefed Members on changes made to each clause and on the import of each clause. She pointed out that subsection 8A(6) had stated that the completion of records was for a collecting society to identify the use of works and, consequently, to collect payment. The clause had been amended to include other uses of the records, but the team had since amended the sentence that had referred to the collecting society only, to include other role players. In addition, the discretion of the courts in respect of minimum sentences had been made very clear in various clauses, including subsection 8A(6), following discussion by the Committee the previous week.

Paragraph 13(a) was amended during the deliberations as it was found that the reference to libraries had not included museums, archives and galleries in that specific paragraph. The additional institutions were added to the paragraph.

There were a couple of unresolved issues in Clause 25. Collecting societies had to be accredited. Paragraph 22B(4)(c) stated that B-BBEEE applied to collecting societies but the scoring was different as it was not an enterprise and so the Companies and Intellectual Properties Commission could not ask for a B-BBEE certificate. The B-BBEE Commission suggested that the Committee insert its own words regarding transformation in the clause. The Committee suggested three elements of transformation that could be included in the legislation: ownership, management and representivity.

The word ‘reciprocal’ had been removed from paragraph 22C(3)(c) because the word had trade agreement or treaty implications and so the paragraph stated simply that ‘an agreement’ should be made with a foreign collecting society, where necessary. The Committee and the Companies and Intellectual Properties Commission disagreed as ‘an agreement’ provided no assurance that it would not be a one-sided agreement and the current problem of getting payment for the use of South African works internationally would continue. It was agreed to reinstate the word “reciprocal’.

Members asked how the uneducated artists would be educated to understand contracts. Did the Department of Trade and Industry have a programme to educate artists? Another Member asked why commissioning of work had been taken out of the Bill. When was the change made and what was the reason for taking commissioned work out of the Bill? Referring to Clause 8, he asked if there was an exception regarding a commissioned work because if there was a commissioned work, the royalties fell away? One Member asked how the exceptions were treated under the principle of fair use in other jurisdictions. Were the exceptions laid out or were they addressed under fair use and, if so, how?

It was agreed that the legal opinion and the related clauses would be reviewed the following week, as would the revision relating to transformation. In the same week, the Committee would engage in a clause-by-clause reading and vote on the Bill.

Meeting report

Opening remarks
The Acting Chairperson welcomed the Committee. The latest copy of the Copyright Amendment Bill was the focus of the meeting.

He recapped the progress of the Bill in the Committee. On 31 October 2018, the Advocate and the Department of Trade and Industry (DTI) had briefed the Committee on the public comments in response to the additional clauses and their responses to the public comments. DTI had also presented an academic opinion from an expert who had looked at exceptions and limitations in respect of compliance with the Berne three-step test. The expert had stated that the Bill passed the three-step test. The Committee had raised concerns about AGOA and other treaties and had looked at exceptions and limitations, especially regarding property as that was in line with section 36 of the Constitution. The Committee had determined that the team should finalise the wording of the clauses in alignment with the Committee input. That had been approved at the meeting on 1 November 2018.

There was a discussion around the reference to the BBBEE Act in the Bill in relation to collecting societies. The B-BBEE Commission had advised that BEE did not apply as a collecting society was not an enterprise doing business with government or government suppliers. The Committee, however, decided that transformation imperatives and representivity or inclusivity were critically important. Not all criteria on the B-BBEE scorecard applied to a collecting society but the drafters of the Bill were requested to consider which elements did apply to a collecting society.

The Acting Chairperson continued, stating that Members had decided that they required a constitutional opinion, which had been promised for 7 November. However, the legal opinion would only be available on 13 November because there had been some issues regarding constitutional implications. The opinion would be distributed to Members before that meeting. The meeting should conclude those clauses not dependent on the legal opinion.

The Acting Chairperson provided the Committee with an outline of the process for that day.  The Advocate would take the Committee through the Bill clause by clause for an in-principle agreement. If there were final issues that Members wished to raise, they should do so. He stated that the following clauses would not be able to be concluded in the absence of the legal opinion on the constitutionality of the clauses: 3, 5, 7, 9, 13 , 22 and 23. Those clauses could only be finalised on 13 November 2018.

Where there was no consensus, voting on the Bill would take place the following week. That would be followed by proofreading of the Creda prints and presented to the Committee for consideration and adoption of the Committee Report on the Bill. That was the process.

Mr G Cachalia (DA) noted that the Committee would vote on 13 November 2018 to get a final adoption of the clauses. His concern was that his only opportunity to run it by the DA caucus would be on the Thursday and so he would not be able to get approval by 13 November 2018. He could give his views but he could not vote on the clauses.

Mr A Williams (ANC) accused Mr Cachalia of stalling tactics. He was sure that he had run it by his caucus previously as the Committee had been working on the Bill for quite some time. He did not believe that the Committee should delay the approval of the clauses scheduled for the next meeting on the Copyright Amendment Bill.

Mr Cachalia stated that he was not responsible for how the days of the week fell out in the calendar, nor was he responsible for the delays in the legal opinion. Those were germane issues. He had been a dutiful, responsible Member who had contributed to the Committee. He took the matter extraordinarily seriously and he took umbrage at the accusations that he was stalling.

The Acting Chairperson congratulated Ms Ntlangwini on her traditional wedding.

Ms E Ntlangwini (EFF) agreed with Mr Williams. The Committee had been working on the Bill for a long time and the Members should have consulted with their caucuses and should have a specific position on the Bill. The Committee should continue as per the schedule proposed by the Chairperson. There should be no delay in finalising the Bill.

Ms P Mantashe (ANC) supported Mr Williams. The Committee had been dealing with the Bill for quite some time and the caucuses should have been aware of the Bill long ago. The Committee could not allow the Bill to be stalled because of some people.

Mr S Mbuyane (ANC) told the Acting Chairperson that he had a problem with the Members engaging with the Acting Chairperson’s opening remarks. The Chairperson should move on with the agenda as the Chairperson could not take decisions on his opening remarks.

Mr Cachalia noted that the Acting Chairperson had said that seven clauses were being held in abeyance. He asked how his caucus could take a definitive decision on an incomplete Bill, not because of his calendar, or the DA’s calendar, but owing to circumstances beyond his control. For his colleagues to continue to impute that he was doing that for some delaying tactic was insane.

The Acting Chairperson, on request of ANC Members, asked Mr Cachalia to withdraw the remark about insanity.

Mr Cachalia said that it was a lack of normalcy. He withdrew his remark.

Adv A Alberts (FF+) said that Members of the Committee knew each other and it was not right to impute ill-will towards each other. Everyone had contributed to the process but the Bill had its own organic growth and delays due to outstanding issues. Some of the delays were not of the making of the Members. It would not harm the Committee to give a little bit of leeway for parties to examine the issues properly and get instructions from their parties. If there was no consensus on the Bill and, if there was going to be litigation on the Bill, he could assure Members that not giving parties enough time to talk to their caucuses and get feedback would definitely play a role in litigation. He could guarantee that.

The Acting Chairperson stated that the Committee would make a decision towards the end of the meeting. He wanted a definitive answer on when the Committee would receive the legal opinion. Firstly, he wanted to receive that opinion timeously so that Members could engage. He did not want to pre-empt what it said. Secondly, he knew that Members had already discussed key issues with their parties. He would speak to the Committee Secretary. While he wanted to be accommodating, the matter had to proceed without further delays. The Committee would review the programme at the end of the meeting.

The Acting Chairperson asked the Members to adopt the agenda. The adoption of the agenda was proposed by Ms L Theko (ANC) and supported by Mr Cachalia.

Presentation on the Copyright Amendment Bill – Senior Legal Advisor
Adv Charmaine van der Merwe, Senior Legal Advisor, Parliament’s Constitutionality and Legal Services Office, took the Committee through each clause of the Copyright Amendment Bill [B13 – 2007] (Draft 4.2.2018.11.01)

Long Title
The Bill began with the long title but it could not be finalised until the clauses had been finalised. If all the clauses were approved, there would be no change to the long title.

The Committee approved the long title in principle.

Clause 1 Definitions
Adv van der Merwe explained why each definition had been included in the Bill.
‘Accessible format copy’ described the type of copy a person with disability would be able to access.
‘Art market professional’ dealt with resale royalty rights and the type of person who could be liable to make payment.
‘Audiovisual work’ was defined because the term cinematographic work was being changed to audiovisual work.
‘Collecting society’ was a recent addition to the Bill.
‘Commercial’ contained a change to the definition on the advice of the expert panel. The word ‘direct’ had been removed from the definition.
‘The Companies Act’ was defined because it was used so frequently in the Bill. The definition meant that there was no longer a need to use the long title of the Companies Act in the Bill.
‘Copyright management information’ dealt with the protection of data, i.e. information in a digital format.
‘Open licence’ also dealt with digital work.
‘Orphan work’ had been discussed at length.
‘Performer’ linked the use of the word to the Performers’ Protection Act, 1967 (Act No. 11 of 1967).
‘Person with a disability’ had contained a circuitous definition which had been changed to avoid using the same words in the definition.
‘Technologically protected work’; ‘technological protection measure’, and ‘technological protection measure circumvention device’ all had to do with the protection of the digital rights that were referred to in the Bill.
‘Tribunal’ was included because there was a name change to the Copyright Tribunal.
‘Visual artistic work’ also dealt with resale royalty rights.

The Committee approved Clause 1 in principle.

Clause 2 Section 2A Scope of copyright protection
Adv van der Merwe explained that Clause 2 inserted a new section into the Act and dealt with the scope of copyright protection. It was not a very contentious clause and was about where copyright did not subsist, e.g. copyright existed in expressions but not in ideas, computer interfaces, parts of tables, etc. For example, speeches in the House of Assembly were not copyrighted so that the speeches could be reported in the media, but a compilation of speeches by the speaker would be copyrighted.

The Committee approved Clause 2 in principle.

Clause 3 Section 5
Clause 3 was flagged for the legal opinion on constitutionality.

Ms Theko asked that the Acting Chairperson remind Members which clauses had to await the legal opinion so that Members did not accidentally agree to a clause where the Committee was waiting for the opinion.

Clause 4 Section 6
Clause 4 dealt with the nature of copyright in literary or musical works. It expanded on the nature of copyright by making the works available by wire or wireless means.
Paragraph 6 (b) was a consequential amendment.

The Committee approved Clause 4 in principle.

Clause 5 Section 6A Share in royalties regarding literary or musical works
Adv van der Merwe stated that the only part of the clause waiting for the legal opinion was subsection 7. So the Committee could discuss Clause 5 up to subsection 6. Section 6A had been inserted into the Bill.

The Acting Chairperson explained to the Committee that Members could look at all subsections of Clause 5, except subsection 7.

Adv van der Merwe explained that the clause dealt with the sharing of royalties. Royalties had been defined as the gross profit made from the exploitation of a literary or musical work by a copyright owner or someone given the right to exploit the work. There had to be a written agreement. Where there was disagreement, the Tribunal could intervene. The contract had to show the percentages to be shared. The sharing of royalties did not apply where the work was part of employment or the copyright was conferred on the state, etc.

Ms Mantashe understood that there was going to be a contract but she recalled a discussion about how people would be educated to understand and manage contracts.

The Acting Chairperson asked the DTI to remind the Committee about its intentions regarding educating artists.

Dr Evelyn Masotja, DDG: Consumer and Corporate Regulation Division, DTI, stated that the Bill provided for the minimum requirements for a standard contract. The DTI was not prescribing a particular contract but was setting minimum requirements to be included in a contract for those rights holders who did not know what should be in a contract. From an implementation perspective, there was room for DTI to educate artists further by creating guidelines or having discussions with artists. Currently the Companies and Intellectual Properties Commission (CIPC) and DTI had discussions with artists, from time to time but, with the Bill, educating artists would be easier as there would be a dispute resolution with clear guidelines spelt out in the contract. The Bill contained the minimum requirements for a contract.

Adv van der Merwe informed Ms Mantashe that the minimum requirements for a contract could be found in section 6A (5) which listed the four main things that had to be in every contract:
(a) the rights and obligations of the author and the copyright owner or the person authorized by the author to use the work as contemplated in subsection (2)(b);
(b )the author’s share of the royalty agreed on, or ordered by the Tribunal, as the case may be;
(c) the method and period within which the amount must be paid to the author by the copyright owner, or the person authorized to use the work as contemplated in subsection (2)(b), to the author; and
(d) a dispute resolution mechanism.

Adv Alberts asked about Clause 6A. He was not at the Committee meeting where commissions had been taken out of the Bill. When was the change made and what was the reason for taking commissioned work out of the Bill?

The Acting Chairperson informed Adv Alberts that the Advocate would respond. He noted that the issue raised by Ms Mantashe was profound. Minimum standards were well and good but if an artist was not a member of a collecting society and did not understand the contract, there had to be guidance for such artists in the implementation phase.

Mr Mbuyane agreed with Ms Mantashe and suggested that the Department should have a programme to educate artists that sought to address the issue of contracts. However, that was for the implementation phase and not the Bill.

Adv van der Merwe stated that the Committee had taken commissioned works out because the Act did not provide for the commissioning of literary or artistic works so it could not be excluded in that particular clause. As Adv Baloyi had pointed out, the Act referred only to a limited number of types of work that could be commissioned and those two were not included. If it had not been facilitated in law, it could not become an exception. It was a legal-technical decision.

The Acting Chairperson reminded the Department that there had to be capacity and preparation for the implementation phase. There was always an intended beneficiary of a law. The following week, Members would focus only on subsection 7. He explained that the blue wording indicated what had been inserted after last meeting.

The Committee approved Clause 5, exception subsection (7), in principle.

Clause 6 Section 7
Adv van der Merwe stated that Section 7 had been amended, in respect of artistic works, in exactly the same way as had been done with literary and music works. The Clause expanded on the nature of copyright of artistic works so that it would also include the right to communicate with the public by wire or wireless means, making it available to the public and by distributing the original copy to the public.

The Committee approved Clause 6 in principle

Clause 7 Section 7B, C, D, E, F
Adv van der Merwe stated that Clause 7A was exactly the same as Clause 5 and only subsection (7) was awaiting the legal opinion. The rest was exactly the same, but dealt with the share of royalties in respect of visual artistic works. The section addressed the details of the written agreement and stated that it did not apply if commissioned, done as part of one’s employment or was conferred upon the state.

The Committee approved Clause 7 section 7A in principle with the exception of subsection 7A(7).

Section 7B Resale royalty right regarding visual artistic works
Section 7B dealt with all aspects of resale royalty rights regarding visual artistic works. It addressed the questions of the rate at which royalties would be payable and how that would be prescribed by the Minister, who would pay the royalty, and included heirs and rights of authors or heirs. Subsection 5 had been deleted.

The Committee approved Clause 7 section 7B in principle.

Section 7C Resale rights – Proof of author
Adv van der Merwe stated that 7C explained that section 7D dealt with who would be regarded as the author in respect of resale royalty rights.

The Committee approved Clause 7 section 7C in principle.

Section 7D Duration of resale royalty right
Adv van der Merwe explained that the resale royalty right of an author of a visual artistic work or his or her heirs expired at the end of the period of 50 years or was determined by a number of conditions.

The Committee approved Clause 7 section 7D in principle.

Section 7E Transmission of resale royalty rights
The advocate stated that the section determined that a resale royalty right “could not be alienated, save for transmission on the death of the holder of the right by testamentary disposition; or by operation of law.” It continued with further conditions relating to the selling or disposing of resale royalty rights and the only conditions under which the right might be alienated. There could be no selling of the right.

The Committee approved Clause 7 section 7E in principle

Section 7F Application of resale royalty right
Sections 7B, 7C, 7D and 7E applied to a visual artistic work that was made before the commencement date of the Copyright Amendment Act, 2019, if that visual artistic work fell within the application of the Act. The resale royalty right only applied to a commercial resale made after the commencement date of the Copyright Amendment Act, 2019. It was applicable to any work assigned before the Amendment Act in respect of future sales.

The Committee approved Clause 7 in principle, except for subsection 7A(7).

Clause 8 Section 8 Nature of copyright in [cinematograph films] audiovisual works
The clause was similar to a previous clause in that it was adding to the nature of copyright. However the whole section was changed because, not only was the nature of copyright expanded, including rental and distribution, ‘film’ was changed to ‘work’ and the name ‘cinematograph films’ changed to ‘audiovisual works’.

The Committee approved Clause 8 in principle.

The Chairperson reminded the Committee that the changes had been made the previous week. The next clause, Clause 9, would be flagged but Adv van der Merwe would explain.

Adv Alberts asked about Clause 8. Was there an exception regarding a commissioned work because if there was a commissioned work, the royalties fell away?

The Chairperson assured him that the exception was there in the audiovisual work

Adv van der Merwe checked the Bill and stated that there was no exception in that clause and the royalties would apply to commissioned works because of the problems experienced by artists with the SABC. There would be a sharing of royalties even if they were commissioned audiovisual works.

Clause 9 Insertion of section 8A: Share in royalties regarding audiovisual works
Adv van der Merwe explained that subsection 8A(5) was to flagged for the legal opinion. The rest of the clause was about sharing of royalties, but in that case, in relation to audiovisual works. The details of a contract, etc. remained the same, However, subsection 8A(6) stated that when any person used a work for commercial purposes, there was a registration requirement. It had to be recorded and submitted to the collecting society. In addition to the offence and penalty, the clause gave courts discretion in terms of imposing the sentence.

The original clause had stated that the completion of records was for a collecting society to identify the use of works and therefore collect payment. The clause had been amended to include other uses of the records, but the team had since realised that the amended sentence referred to the collecting society only, which excluded other role players. It had therefore been corrected as follows:
“8A(6)(b) submit a complete, true and accurate report to the performer, copyright owner, the indigenous community or collecting society, as the case may be, in the prescribed manner, for purposes that include the calculation of royalties due and payable by that person.”

The Committee approved Clause 8 in principle, excepting subsection 8A(5).

The Chairperson stated that it was an important issue because there were many types of agreements that had to be entered into because freedom had to be protected at all times. The discretion of the courts had been allowed by the Committee after discussion the previous week.

Clause 10 Section 9 
Adv van der Merwe explained that the Clause also expanded on the right to make the sound recording available to the public by wire or wireless means, distributing to the public or authorising commercial rentals.

The Committee approved Clause 10 in principle.

Clause 11 Section 9A Royalties regarding sound recordings
Clause 11 dealt with where royalties were payable, taking into account the expanded rights that had been addressed above. Paragraph A(a) provided for a report where a work was used and broadened the mandate so that it was not restricted to payments or collecting societies and referred to the agreements regarding royalties. Consequently, paragraphs (b) and (c) were deleted. There were no amendments to subsection (3).
The offence and the fine were included and the reference to the discretion of the court was included.
In subsection a(A), paragraph (f) was as a consequential amendment.

The Committee approved Clause 11 in principle.

Clause 12 Section 12 General exceptions from copyright protection
Section 12 had been repealed from the principal Act because the issue had been dealt with from Clause 13 in the Amendment. Instead of a general exception, there were specific exceptions.

The Committee approved Clause 12 in principle.

Clause 13
Adv van der Merwe explained that the whole clause was flagged. Exceptions had been agreed to by the Committee but the question was whether the new way of regulating exceptions would pass constitutional muster.

Clause 13 was flagged.

The Acting Chairperson asked the Committee to note the clause and to be aware of the issues that had been raised. The Committee had had no issue with the exceptions, but had to be ready at the next meeting when the legal opinion would address the entire clause.

Clause 14 Section 15
Adv van der Merwe explained that clause amended section 15 in the principal Act and related to exceptions to copyright in respect of artistic works. The change from cinematographic film to ‘another work’ had to be noted because the exception was not restricted to audiovisual, but also related to panorama and incidental works. Copies of a background were also not copyrighted. Currently, a picture taken in front of, for example, a statute of Nelson Mandela was copyrighted and should not, for example, be loaded on Facebook as that was an infringement of copyright. The clause permitted the use of such a background as it became an exception to copyright.

The Committee approved Clause 14 in principle.

Clause 15 – deleted

Clauses 16, 17 and 18 were repealed.

The Acting Chairperson checked that all Members were keeping up and understood why the paragraphs had been deleted or repealed.

Clause 19 Section 19B Exceptions regarding protection of computer programs
Clause 19 changed a whole section of the Act and dealt with the exceptions regarding computer programmes so that technicians could work on computer programmes for the purpose of interoperability. As it related only to interoperability, it was not open-ended and did not allow anyone to tamper with the codes of another programme. It brought in new technology. Interoperability was explained.

The Committee approved Clause 19 in principle.

Clause 20 Section 19C General exceptions regarding protection of copyright work for libraries, archives, museums and galleries
Adv van der Merwe noted that that it was one of the more important clauses of the Bill. It dealt with exceptions to allow galleries, archives, museums and libraries to provide a service to the public. It was not open-ended and would not penalise copyright holders. The clause listed, in subsections 2 to 13, describes the activities that the institutions could engage in without authorisation from the copyright holders.

Paragraph 13(a) referred only to libraries, whereas in all other paragraphs applied to galleries, archives, museums and libraries.

The Acting Chairperson asked the DDG for her opinion on whether the exception should be expanded to the other institutions.

Dr Masotja stated that her team believed that it was an error and that the exception should be expanded. She suggested that the exception had to apply to galleries, archives and museums as well as libraries.

The Acting Chairperson asked the Members for their opinion that 13(a) be expanded from just libraries to include museums, archives and galleries.

Mr Cachalia asked how the exceptions were treated under the principle of fair use in other jurisdictions. Were the exceptions laid out or were that addressed under fair use and, if so, how?

Ms Meshendri Padayachy, Deputy Director: Intellectual Property Law, DTI, explained that fair use was a general exception and was broader, but the Bill was using a hybrid model. The World Intellectual Properties Office was looking at exceptions and limitations because of the preservation role played by those institutions in 13(b). Fair use allowed the exceptions and could be seen as a golden link, but the Bill needed a specific exception so that libraries knew how to use the exception and because the Bill had taken the hybrid approach. The exception also meant that officials in those institutions could not be held liable for exercising the exceptions.

The Committee agreed to expand the exception in 13(a) to ensure consistency.

The Committee approved Clause 20 section 19C in principle.

Clause 20 Section 19D General exceptions regarding protection of copyright work for persons with disability
Adv van der Merwe explained that the change was to using the word ‘person’ and not organisations. The organisations had to be prescribed by the Minister. Those organisations could make accessible copies for persons with disabilities.

The Committee approved Clause 20 section 19D in principle.

Clause 21 Section 20
Section 20 dealt with moral rights. The amendments ensured alignment of terminology. For example, ‘transfer’ became ‘assignment’ of works. The works were not listed any longer. The reference was to ‘all’ works because moral rights should exist with all works. The clause included a proviso for a sound recording, audiovisual works or computer programme that stated the author could not prevent changes, even if a person had the moral rights. Subsection dealt with the right to talk legal action to enforce one’s moral rights.

The Committee approved Clause 20 section 19D in principle.

The Chairperson noted that there were two paragraphs in the next two clauses that would have to await the legal opinion but he asked Adv van der Merwe to explain.

Clause 22 Section 21
Adv van der Merwe explained that paragraph 21(b) had to be flagged because it was linked to Clause 3.
Paragraph 21(a) required a written agreement between parties for a commissioned work. More paragraphs had been inserted. Paragraphs 21(c)(a) and 21(c)(b) spoke about the agreement and what it had to look like and 21(c)(c) indicated when the Tribunal could determine that the author could request use of a work that was not being used, etc. That request could not include personal works. The clause had been heavily debated because Members had questioned how the Tribunal would know when to allow an author to use the work. She explained that all of the conditions discussed by the Committee had been included in the subsection.

The Committee approved Clause 22 but section 21(b) was flagged.

The Acting Chairperson informed the Advocate that she did not need to go into too much detail about the remaining clauses where issues had been dealt with.

Clause 23 Section 22
In Clause 23, section 22(b) was flagged.
Section 22(a) said that copyright owned by the state could not be assigned. Paragraph 22(c) was an addition of subsection (8) and indicated whether a licence was allowed or not.

The Committee approved Clause 23, sections 22(a) and (c), but section 22(b) was flagged.

Ms Theko said that the Acting Chairperson could not say that he agreed with himself. The Committee had to agree with him when approving a clause.

The Acting Chairperson said Members had to raise objections where they did not agree.

Mr Cachalia said that Members reserved the right to object at a later stage.

The Chairperson agreed with Mr Cachalia because the agreement was only in principle. When it came to the clause-by-clause reading, Members could object and then the clause would go to a vote. The process had been working well throughout the meeting and he did not think that it was necessary to change the modus operandi at that stage.

Clause 24 Section 22A Licences in respect of orphan works
Adv van der Merwe stated that a new section related to orphan works had been inserted. Subsection 10 was an insertion based on the input of the expert panel. It related to the identity of an author who had a resale royalty right and was unknown or could not be located. It indicated the Commission’s (CIPC’s) role.

The Committee approved Clause 24.

Chapter1A Collecting Societies
Clause 25 Section 22B Accreditation
Adv van der Merwe stated that there were a couple of unresolved issues in Clause 25. Collecting societies had to be accredited. Paragraph 22B(4)(c) B-BBEEE applied to collecting societies but the scoring was different because it was not an enterprise and so the Commission could not ask for a B-BBEE certificate. The B-BBEE Commission suggested that the Committee insert its own words regarding transformation. The Committee had agreed at previous meeting that the word transformation be inserted but the specific elements of transformation had to be included such as ownership, representivity, and also something around management.

The Acting Chairperson said that the B-BBEE Commission had caused confusion. One Member had said that B-BBEE was the only transformation legislation but he had been corrected. Then the Committee had asked the drafting team to determine which elements of transformation should be included in the paragraph. The work had not been done because DTI had not provided the wording. Ownership and representivity were important but the wording had not been concluded. He asked DDG for the work.

The DDG explained that the team had gone back and had looked at applicable legislation that talked to transformation alternatives, including the Promotion of Equality and Prevention of Unfair Discrimination Act. The team could not find an Act that talked to transformation as the Committee required but suggested that certain words be used that spoke to representivity and transformation. They had considered bringing a proposal regarding the wording.

The Acting Chairperson had thought that the proposed amendment would be presented to the Committee in the meeting but there was no proposal. He asked DTI to prepare the wording before the end of the meeting. Paragraph 22B(4)(c) had to be flagged. The transformation imperative had been agreed upon but what it was to look like, was an issue.

Ms Mantashe wanted to hear the CIPC Commissioner’s views on the matter.

Mr Mbuyane said that the definition in clause 1 said that a collecting society was a non-profit company, and a company fell under CIPC, hence the Members were requesting the Commissioner to give input. Collecting societies fell under the Companies Act so he did not know why the B-BBEE did not apply to them. At the previous meeting, Members had proposed that the B-BBEE should apply to the collecting society. If DTI did not give a suitable proposal, the Members would come up with their own proposal.

The Acting Chairperson asked the Members to be patient. He explained that it was a legal matter and the B-BBEE legislation was not applicable to collecting societies. Members had always stated that the Committee had to work within the law. However, he agreed that transformation was an imperative. Because of the society that they were trying to build, there were certain transformation imperatives that were applicable. Some elements in the scorecard were applicable but others were not. What was the empowering legislation? CIPC should propose the wording to replace the words BBBEE. The Members would then apply their minds as ultimately, it was the decision of the Committee.

Mr Cachalia had a question of clarity. He was trying to understand what the Committee was trying to transform. The Members, whoever they were, had ownership of, and controlled, the collecting societies and a collecting society had a management which looked after them. What were the Members transforming, given that they could not change the members of the collecting society? Were they transforming management and maybe the procurement in terms of the little that was used by the collecting societies?

The Acting Chairperson said that the Committee should not bog itself down. Depending on the transformation imperatives suggested, key imperatives had to be looking at the profile of a collecting society in terms of who owned it, who managed it and who worked at what levels. What would the societies use to gain accreditation? The B-BBEE certificate was not wholly applicable. What were the minimum things that the Committee wanted to see in terms of the transformation. The Committee might not be able to finish that day as the proposal had not yet been seen. However, the discussion was not even based on a firm proposal so it might be self-defeating.

Adv Alberts asked a question of clarity. The Committee had agreed that there would be one collecting society per right. Was that still the case?

The Acting Chairperson explained that that decision had not been constitutional as people had a right of association.  The decision had been revoked.

Adv Alberts informed the Chairperson that he would take that matter further at a later stage.

The Chairperson said that the Committee would come back to (4)(c ) as that was the only issue. There were no other issues.

Adv van der Merwe said there were other issues.

Ms Mantashe said that she was waiting for CIPC.

The Acting Chairperson explained that the CIPC had to formulate the response before the Commissioner could respond.

Adv van der Merwe continued. Section 22C of clause 25 showed what the collecting societies could do and how that had to be done. It was about the administration of the collecting societies, including international agreements. The clause also spoke about an offence, the minimum turnover and how to calculate fines. It also gave the courts discretion as the sentence was a minimum one. Royalties were also discussed and how they should be managed. The clause allowed for the Commission to issue a compliance note and indicated how an Administrator could take over collecting societies via the Commission and Tribunal.

Ms Theko referred to paragraph 22C(3)(c). Was reciprocity being removed and replaced by the word ‘foreign’? What was the CIPC’s take on the change? What was going to change? Would the obligation of a foreign country change?

The DDG explained that the word ‘reciprocal’ had trade agreement or treaty implications. The team had considered ‘bilateral’ but a bilateral agreement also had treaty implications, so the word ‘reciprocal’ had been removed and only the words ‘an agreement’ remained in the Bill to ensure that it was clear. The policy intention that the foreign collecting society could make foreign agreements had been retained.

Ms Theko asked where the Bill obligated the foreign country to pay the royalty.

The Acting Chairperson explained that the collecting societies were doing the collecting of royalties and the Bill simply allowed the societies to make agreements to collect royalties, even with those abroad. The Bill included domestic and foreign collecting societies. Was it adequate or did she want it to re-instate ‘reciprocal’? Could she suggest something that implied ‘reciprocal’ but would not be confused with international treaties?

Ms Theko asked how the collecting societies would be able to ensure that other countries paid. She did not know what happened in other countries. She wanted guidance and advice from CIPC. The paragraph was not adequate.

Mr Mbuyane stated that currently there were agreements with international organisations but there were challenges in collecting royalties. Would that clause not lead to more of the same?

The Acting Chairperson asked the Commissioner for his input.

Adv Voller, Commissioner at the CIPC stated that there was a problem in collecting royalties for international use of South African artists’ work. The collecting societies in SA collected royalties on behalf of international artists from commercial use in SA but internationally the royalties were not paid to SA artists. He wanted ‘reciprocal’ retained in the clause because, as it stood, it could be a one-sided agreement.
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The Acting Chairperson agreed that ‘reciprocal’ be retained. The Committee did not accept the suggestion that the word be deleted.

The Committee approved Clause 25 in principle except for paragraph 22C(3)(c) which was flagged.

After a short break, the Acting Chairperson stated, as a matter of principle, that if decisions were to be made, the documents had to be circulated on time. If something had not been done by the technical team, he had to be alerted. He was from the old school and so if it was not done, he would ask why it had not been done. The legal opinion was a problem. The Committee could not afford to have deadlines promised and ignored. That was a matter of principle that he would not even engage on. He had made a decision that the legal opinion had to be circulated before 13 November 2018. He wanted a firm date by which it would be circulated by the time that the meeting came to an end. If the document was not received timeously, the Committee would have to call off the meeting. It was unacceptable to receive documents in a meeting. That was the wrong method of working. It was unfair to expect Members to apply their minds over a short period of time. It was a matter of principle, not negotiations.

The Acting Chairperson asked CIPS and DTI to indicate whether the Amendment would be ready in time. He would give a roadmap for the process at the end of the meeting so that everyone knew what was expected of them. His school of thought was that one had a conversation about the journey before a long journey and one had everything one needed to take for the journey. He would pause at the end of the journey and reflect.

Adv van der Merwe stated that she had not understood the instruction regarding the B-BBEE issue. She had thought that the technical team had had to look for applicable legislation. She did not think that the team could give a response by the end of meeting as she now understood that it was elements of transformation that the Committee required. She requested that the technical team be permitted to bring the wording to the Committee the following week.

The Acting Chairperson stated that the Committee would have a brief discussion on the matter before concluding the meeting. The Committee would consider some of the elements that it wanted to see in the Bill so that the team did not present something that was not right. Members could think about it. The Advocate and DTI should ask him if they were not sure what was required. People were suffering so the Committee had to finalise the Bill. When he chaired, he stated how the meeting would progress and at the end, he would say how they had concluded so that everyone was on the same page.

Clause 26 Section 23
Adv van der Merwe stated that section 23 dealt with infringement in general. Section 23 provided civil remedies in respect of digital in (b) and (c) because digital work had not previously been included in the Act.

The Committee approved Clause 26 in principle.

Clause 27 Section 27
Adv van der Merwe explained that the clause amended section 27 by dealing with penalties for digital protection. The clause explained, and made provision for, the infringement of technological measures as well as what the fine would be. The fine was a minimum of 5% annual turnover. The clause indicated how to determine the turnover and the final paragraph allowed the court to use its discretion in imposing the minimum sentence if there were justifiable and extenuating circumstances.

The Acting Chairperson stated that the Committee had engaged in a long discussion about minimum sentences and had agreed to allow the courts to use discretion.

The Committee approved Clause 27 in principle.

Clause 28 Section 28
The Advocate stated that the clause dealt with importation, and when importation would be an infringement. If a copy was made in another country with the permission of the copyright owner, that copy could be imported.

The Committee approved Clause 28 in principle.

Clause 29 Sections 28O to 28S
The whole clause dealt with prohibited conduct in respect of technological protection measures (280); specified exceptions (28P); enforcement of Act by the Commission (28Q); prohibited conduct in respect of copyright management information (28R), and exceptions in respect of copyright management information (28S).

The Committee approved Clause 29 Sections 28O to 28S in principle.

Clause 30 Section 29 Establishment of Tribunal
Adv van der Merwe stated that the clause dealt with the establishment of the Tribunal and even the Department of Justice had provided assistance on the matter.

The Committee approved Clause 30 in principle.

Clause 31 Sections 29A, 29B, 29C, 29D
Each section of the clause dealt with a specific aspect of the Tribunal. Section 29A dealt with the functions of the Tribunal; 29B dealt with removal or suspension of members of the Tribunal; 29C addressed conflict and disclosure of interest; 29D addressed the proceedings of the Tribunal; 26D dealt with hearings before the Tribunal; 29F addressed the right to participate in hearings; 29G dealt with the power of the member presiding at the Tribunal; and 29H addressed orders of the Tribunal.

The Committee approved Clause 31 in principle.

Clause 32 was repealed.

Clause 33 Section 39
Adv van der Merwe stated that Clause 33 dealt with regulations which the Minister was required to prescribe. It addressed a wide range of issues and a paragraph had been added to ensure that the regulations were published for public comment: Section 39(c)(2): “Before making any regulations in terms of subsection (1), the Minister must publish the proposed regulations for public comment for a period of not less than 30 days”.

The Acting Chairperson stated that 39(c)(2) was one of the things that Mr Cachalia had insisted upon so that the Minister could not act without consultation.

The Committee approved Clause 33 in principle.

Clause 34 section 39B Unenforceable contractual term
Adv van der Merwe pointed out that Clause 34 was a new section dealing with unenforceable contractual terms. The intention of the clause was to prevent an author from signing away rights. If the terms of a contract prevented or restricted any act which the Act had made a right, or for which it offered protection, those terms would be legally unenforceable. That did not prevent someone from choosing to give away rights. Both parties could agree in terms of gentleman’s agreement but in a court of law, it would be unenforceable. It did not interfere with open licences.

The Committee approved Clause 27 in principle.

Adv van der Merwe stated that there had been no concerns by the public in respect of Schedule 1 A and B. The technical team had made some technical corrections. The schedules related to translation licences and reproduction licences.

The Acting Chairperson stated that the detailed and in-principle deliberations had been concluded. He addressed the question of the transformation elements, asking for input from Members.

Mr Mbuyane suggested that there were two elements: ownership and management.

The Acting Chairperson noted that who owned the society was one element and the second element was about who managed the society. The management element was about participation.

Ms Mantashe asked why equity was being excluded from the requirements.

The Acting Chairperson explained that equity was about representivity and the technical team could look at those issues. He asked the EFF Member for her views.

Ms Ntlangwini had nothing to add but she was in agreement with her colleagues.

The Acting Chairperson asked the technical team to consider the elements raised. He also asked for a written statement from the B-BBEE Commission regarding the applicability of the Act to a collecting society. He explained to Mr Cachalia that other elements of the scorecard did not apply to collecting societies. Those elements were in the Employment Equity Act.

Summary of the process
The Acting Chairperson concluded that the following clauses were outstanding: Clause 3 – whole clause; Clause 5 section (7); Clause 7 section (7)(a)(7); Clause section 9(5); Clause 6 – editing; Clause 13 - whole clause; Clause 22 section (22)(b) which was linked to Clause 3; Clause 23 section 23(b). The question on B-BBEE was in paragraph 22B(4)(c) and required new wording showing the elements of B-BBEE: ownership, management and representativity.

The Acting Chairperson asked Members to be ready to engage the following week.

Way forward
On 13 November 2018, the Committee would consider the constitutionality of the identified clauses. After hearing the legal opinion, specific amendments would have to be proposed. If amendments were proposed and effected, the technical team would have to effect the changes. On the same day, 13 November 2018, the Bill would be sent to Creda Printing. Proofreading in terms of the Creda version would have to be completed and the Bill had to be ready for tabling. The final version of the Bill would come back and on 14 November 2018, the technical team would proofread the Bill. On 15 November 2018 the Committee should be able to meet from 14:00 to 16:00 to conclude its business with the Bill. He noted that the team had very tight deadlines. He wanted to know, on record, when the legal opinion would be circulated. He was asking for it to be circulated to all Members on Monday 12 November 2018 before 14:00. If the Committee did not receive the legal opinion, the meeting would be called off. The legal opinion might raise issues that the Committee would have to address.

Dr Masotja agreed that the legal opinion would be circulated on 12 November 2018 before 14:00.

The clause-by-clause reading for adoption of the Bill was scheduled for 15 November 2018 so that it could be ready for debate in the House on 19 November 2018.

Ms Theko thanked the Acting Chairperson and the technical team for the work. What remained was the ‘rectification’ of WIPO and other treaties. Those were the responsibilities of the DTI. The DTI should report back to the Committee on its implementation readiness.

Mr Mbuyane asked if the clause-by-clause reading would be on 13 or 15 November.

The Acting Chairperson explained that the legal opinion would be sent to Committee Members on 12 November so that on 13 November, the Committee would reflect on the clauses affected by the legal opinion. If any amendments were necessary, the amendments would go back to the technical team. The Committee would also look at the transformation elements that had to be included in the Bill. Only on 15 November 2018, would the clause-by-clause reading would take place.

The Committee programme would be circulated.

On Thursday, 8 November 2018, the Committee would attend to the Performer’s Protection Bill. The advocate and the DTI would report back on the public submissions and their responses to the submissions. That would be the only substantive item on the agenda.

Closing Remarks

The Acting Chairperson informed Members that the BRRR from the Committee had been deferred in the House of Assembly because there had not been a quorum. The BRRR would be read that afternoon. There would be no declaration in the House; only a reading. The Committee had already declared. The Economic Cluster would be answering questions that afternoon. He requested all Members to attend the sitting.

The Chairperson thanked everyone for their focused engagement on the Bill.

The meeting was adjourned.
 

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