An overhaul of the 1994 Copyright Act is underway

The Copyright (New Technologies and Performers' Rights) Amendment Bill passed its first reading in Parliament in December 2006 and is currently before the Commerce Select Committee. Submissions on the Bill are due by 9 March 2007. In this commentary Bell Gully Partner Wayne Hudson outlines the key changes proposed by the Bill.

The Bill seeks to bring New Zealand's copyright law up-to-date with digital technology and make it more consistent with those of our major trading partners.  The amendments introduced by the Bill aim to reduce the need for costly litigation and piracy by clarifying what constitutes copyright infringement.  If the Bill is passed, the amendments will be reviewed within five years to ensure that they operate effectively.

Key changes and issues

Copying and communication

The Bill amends the definition of "copying" to make it clear that in the Copyright Act 1994 it includes the copying of works in any digital format.

The definition of "copying" includes the unavoidable and inconsequential copying processes that occurs when people browse the internet.  Transient or incidental copying will not constitute an infringement of copyright, as long as it is a necessary part of a technological process and has no independent economic significance.  This exception applies to transient copying of both recorded works and performances.

To keep up with technological developments, the Bill replaces references to "broadcast" and "cable programme" with the technology-neutral expression "communication work", which is defined as:

"a transmission, or the making available by a communication technology, of sounds, visual images, or other information, or a combination of any of those, for reception by members of the public, and includes a broadcast or a cable programme".

In line with this change, the Bill replaces the copyright holder's right to "broadcast the work or include the work in a cable programme service" with a technology-neutral right to "communicate the work to the public".

Under the Act, a cable programme service can receive and re-transmit broadcasts without infringing the original broadcaster's copyright.  The Bill will repeal this section.

Changes relevant to educational establishments

The Bill allows educational establishments to make and store digital copies of copyright works without infringing copyright, subject to the following conditions:

• digital copies can only be supplied to students of the establishment having lessons relating to the particular work;
  
  
• digital copies can be stored by an educational establishment if specified information is attached to the material and use of the material is restricted to students participating in the course for which the material is stored; and
  
  
• the educational establishment must delete the material within a reasonable timeframe once it is no longer relevant to the course for which it was stored.

Changes relevant to libraries and archives

The Bill allows a library or archive to give users on-site and off-site access to works in digital formats without infringing copyright.  The library or archive must inform the user in writing about limits on copying and communication of the work prescribed by the Act, and ensure that the digital copy cannot be altered or erased by the user.  A library or archive can supply a digital copy of a work to a user, or to another library or archive, provided specified conditions are met.

Computer programs

The Bill allows the lawful user of a computer program, expressed in a low level language, to decompile the program without infringing copyright if certain conditions are met. In particular, decompilation must be necessary to the objective of creating an independent program that is not substantially similar in expression to the decompiled program. Further, the information obtained from decompilation must not be used for any other purpose nor passed on to any other person.

Lawful users of computer programs may copy or adapt a program without infringing copyright where doing so is necessary for their lawful use of the program, (for example, correcting an error in the program).  However, a user may only copy or adapt a program to correct an error if a properly functioning and error-free copy of the program is not available within a reasonable timeframe at the ordinary commercial price.

Under the Bill, contractual terms or conditions relating to the use of a computer program have no effect if they aim to prohibit decompiling, copying or adapting a program in accordance with the conditions set out for those activities.  Contractual terms or conditions are also invalid if they aim to prohibit a user from studying the functioning of a program to understand the underlying ideas and principles.

Copying sound recordings for private and domestic use

The Bill allows for the widespread practice of copying music into different formats for use with different devices.  It allows individuals to copy sound recordings into different formats without infringing copyright if the following conditions are met:

• the sound recording to be copied is not itself an infringing copy; and
  
  
• the person making the copy owns the original sound recording, and acquired it legitimately; and
  
• the copy is for the owner's private and domestic use only; and
  
  
• only one copy for each type of playing device owned by the owner can be lawfully made; and
  
  
• the owner of the sound recording retains ownership of any copies made.

If the owner is bound by any contract specifying the circumstances in which a sound recording can be copied, the contract would override the conditions set out in the Bill.

This section of the Bill is limited to sound recordings.  It does not allow for the copying of audiovisual works such as movies and music video clips into different formats.  Practices such as copying CDs for friends and online file sharing would therefore remain an infringement of copyright.

This section of the Bill expires two years after it comes into force, unless the Governor General extends it.

Liability of internet service providers (ISPs) for infringement of copyright

Copying material is an essential part of many services provided by ISPs.  Under the Copyright Act, ISPs could potentially face liability for primary and secondary copyright infringement.  The Bill does limit ISP liability in some circumstances and in order to qualify for the limitations, an ISP must implement a policy of terminating the accounts of repeat copyright infringers.

An ISP will not be criminally or civilly liable for copyright infringement by a user of the ISP's services.  An ISP will not infringe copyright by storing infringing material provided by a user unless it knew or had reason to believe that the material infringed copyright in a work, and failed to delete or prevent access to the infringing material as soon as possible after acquiring such knowledge. 

An ISP will also be liable for copyright infringement if the user is "acting under the authority and control" of the ISP.  If an ISP deletes a user's material or blocks access because of suspected copyright infringement, the ISP must notify the user of its actions.

An ISP will not infringe copyright by caching infringing material where the ISP:

• does not modify the material; and
  
  
• complies with any conditions imposed by the copyright owner; and
  
  
• does not interfere with the lawful use of technology to obtain data on the use of the material; and
  
  
• updates the material in accordance with industry practice.

If an ISP becomes aware that material it has cached has been blocked or deleted at its original source, it must delete or block access to the cached material as soon as possible.  Failure to do so will constitute a copyright infringement.

The copyright owner will still have the right to seek an injunction against the ISP.

Clarification relating to technological protection measures (TPM)

A TPM is a mechanism or system that prevents or inhibits copyright infringement, for example the anti-copying technology now commonly used on music CDs.  Devices and means for overcoming TPMs, known as TPM spoiling devices, have been developed. 

The Bill prohibits making a TPM spoiling device available for sale or hire, and prohibits actions leading to a TPM spoiling device becoming available for sale or hire, such as making or importing one.  Providing a service or information intended to enable or assist others to circumvent a TPM is also prohibited.  These prohibitions only apply where the person providing the TPM spoiling device, service, or information, knows or has reason to believe that it would be used to infringe copyright in a TPM-protected work.  A breach of these prohibitions is an offence with a penalty of a fine up to $150,000, up to five years imprisonment, or both.

It should be noted that the act of circumventing a TPM itself is not expressly prohibited.

Libraries, archives and educational establishments may use TPM spoiling devices to overcome TPMs in order to carry out permitted copying, correct errors in computer programs, effect interoperability of software and undertake encryption research.

If someone wishes to copy a CD into MP3 format for their MP3 player, but is prevented from doing so by a TPM, they must approach the copyright owner for assistance.  If this is unsuccessful they could engage a librarian or archivist to use a TPM spoiling device to overcome the TPM on their behalf.

Copyright management information (CMI)

Copyright management information (CMI) is information attached to a copyright work that identifies the author or copyright owner of the work, or indicates terms and conditions for use of the work.  The Bill prohibits interference with CMI without the authorisation of the copyright owner if the interfering person has reason to believe that the interference would induce, enable or conceal copyright infringement. 

The Bill creates an offence for commercial dealing of a work with knowledge that its CMI has been interfered with, without the authorisation of the copyright owner, and knowledge that dealing will induce, enable, or conceal, a copyright infringement.  The offence carries a penalty of a fine up to $150,000, up to five years imprisonment, or both.

Enquiries and information

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