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Rights for Creators or Dismantling Copyright?

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Rights for Creators or Dismantling Copyright?

27th March 2019

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As Parliament moves towards the adoption of an ill-advised and largely unresearched 2017 Copyright Amendment Bill, the opinion piece by Professor Sean Flynn of the American University Washington College of Law “South Africa Moves Forward With Creator Rights Agenda” in IP Watch (now dormant) calls for an urgent rebuttal.

The Parliamentary public hearings in August 2017 were characterised by a commonality of purpose for updating the Copyright Act, last amended in 2002, to bring it in line with the needs of the digital environment and to improve the position of creators and performers following the recommendations of the Copyright Review Commission.  The Bill, however, was universally considered as having been poorly written, even by Parliament.  

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At the hearings, Prof Flynn advocated a study his team was working on to show that there was a link between countries that have ‘fair use’ and other ‘open exceptions’ in their laws, and a supposedly advanced state of innovation in those countries.  This study was demolished by Dr George Ford of the Phoenix Center, who concluded that “my review of the Flynn-Palmedo Study is not  exhaustive;  the  errors  are  too  numerous” and that “in light of the flimsy results, the Flynn-Palmedo Study is not relevant for policymaking” (“The Vanishing Benefits of Fair Use: A Review of the Flynn-Palmedo Study on “User Rights” in Copyright Law”, December 2017).

At that time, Prof Flynn and like-minded individuals were lobbying for the Bill to contain so-called “users’ rights”. After explicit “users’ rights” were removed from the exceptions in a subsequent text of the Bill in October 2017, the same people, including Prof Flynn, started claiming to speak for creators, establishing an organisation called “Recreate” that lobbied to retain exactly the same copyright exceptions that were in the original Bill, now with the notion that these same provisions are somehow “creator rights.” 

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Other than the removal of the explicit “users’ rights” concept, there was very little difference between the copyright exceptions proposed in the original Bill in May 2017 and the subsequent version approved by the National Assembly, the lower house of Parliament, in December 2018. A significant change, though, one for which Prof Flynn lobbied, was the introduction of the term “such as” before the expansive range of ‘fair use’ purposes in the Bill.  The point has to be made at the outset that the provision often referred to, including by Prof Flynn, as a “fair use clause” in the Bill, is not a provision that follows the examples of the United States and the other countries referenced by its proponents, but a far more wide-ranging provision without the balancing mechanisms that exist in the United States and elsewhere.

This becomes clear from an analysis of Prof Flynn’s claims of the supposed benefits of the Bill.  With its patent errors, its selective presentation of some key provisions and its omission in dealing with others, and with its rationalisation of provisions by mere slogans substituting for academic consideration, it is really an unexpectedly inept analyses of the Bill.  Below I reproduce Prof Flynn’s table referencing the new sections to be introduced by the Bill, as is allowed under the existing fair dealing exception for criticism and review in Section 12(1)(c) of the Copyright Act, with my comment following the statement in relation to each section. 

Simply for the sake of length, I have only commented on the 16 most important provisions.  The references in the table have been reorganised to facilitate comment by subject matter.

In respect of every comment, the questions have to be asked: 1. Why is the Government doing this? 2. Why did Prof Flynn not comment on it in his article or in his submissions to Parliament?

Comment:  S.12A differs dramatically from the ‘fair use’ provisions in the few countries that have this statutory defence, in manners not relayed by Prof Flynn. Permitted purposes in S.12A and not in Section 107 of the US Copyright Act are “personal use, including the use of a lawful copy of the work at a different time or with a different device; scholarship, teaching and education; illustration, parody, satire, caricature, cartoon, tribute, homage or pastiche; preservation of and access to the collections of libraries, archives and museums; ensuring proper performance of public administration.”

Prof Flynn clearly sees no problem with this, having made a submission promoting a ‘fair use’ clause with 21 permitted purposes in 2017. 

Unlike the US, there is no compulsory statutory damages provision, nor does the Bill introduce one, and there is therefore no incentive for a potential infringer to consider the consequences of a mis-reliance on ‘fair use.’

Prof Flynn overlooked mentioning S.39B, a key provision overriding all contracts, namely that “to the extent that a term of a contract purports to prevent or restrict the doing of any act which by virtue of this Act would not infringe copyright … such term shall be unenforceable.”  It will therefore become impossible to agree to disagree on whether a given use is ‘fair use’ or not, since any agreement to this effect will not be worth the paper it is written on.  All infringement claims involving a ‘fair use’ defence will therefore have to be decided by a Court, and even mutually-agreed settlements will need to be confirmed by Court Order.

S.12A, in the context of the Bill, is not ‘fair use’, and therefore arguments that “fair-use provisions have not harmed authors and creators in the US and other countries, and suggestions that they would do so here are without basis” (for example by Marcus Low) cannot stand up to scrutiny.

Comment: This provision makes no change to South African law, the principle that “there is no copyright in ideas” being trite in case law, and official government texts not having copyright in terms of the existing Section 12(8). 

S.2A also says “Copyright protection subsists in expressions and not in the case of computer programs, in interface specifications.”  Its purpose seems to be to preserve the interpretation of the application of ‘fair use’ in the lower court judgment in the US Oracle v. Google case, since overturned by the Federal Circuit of Appeals in 2018. 

Comment:  S.12B encapsulates all the provisions that were previously ‘fair dealing’ exceptions, but removing the qualification of “fair practice” from them, thereby leaving them non-compliant with the Three-Step Test for copyright exceptions laid down in the Berne Convention, TRIPS and WCT. 

The exceptions that currently appear in the Act reflect a painstaking distinction as to which exceptions work with which kinds of copyright works, and which do not.  Clearly, the same exceptions cannot apply across the board to literary, musical and artistic works and to films, sound recordings, published editions and computer programmes.  The Bill sweeps these distinctions away, with no reason given.

Comment:  S.12C also has a format-shifting exception that does not even require the beneficiary of the exception to have a legitimately acquired copy, as well as a layout error that makes it seem as if the “no independent, economic significance” requirement does not apply to the temporary copy exception, as it should.

Comment:  S.12D allows many more permission-free uses than this, and this provision, together with ‘fair use’’ for the purpose of education, is the one that is forecast by an impact assessment by PwC   to be the most damaging to the publishing industry and therefore the availability of locally-produced content. As with many statements Prof Flynn makes in this table, what should be an academic explanation is reduced to rationalisation by a mere slogan.

S.12D allows educational institutions to make coursepacks compiled of extracts from copyright works of others, without permission or remuneration, a form of product substitution that is not even allowed under ‘fair use’, as is clear from the history of the US case of Cambridge University Press v. Georgia State. S.12D will also allow the wholescale cut & paste of content from copyright works into assignments, portfolios, theses or dissertations, and “for personal use, library deposit or posting on an institutional repository”, all without permission, with the author’s name only having to be stated “as far as is practicable.”

Comment:  This does not explain why S.19C is necessary, since the existing Act already has exceptions for personal use, and so will S.12B. Prof Flynn does not deal with that, and his justification is a rationalisation by way of a slogan, hardly academic analysis.

Comment:  The public comments found across-the-board support for an exception for the disabled, especially the visually-impaired, but S.19D’s non-compliance with international treaties will not allow South Africa to benefit from the provisions of the Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired or Otherwise Print Disabled.

Comment:  Schedule 2 contains a set of statutory licences that has its origins in the Appendix to the Berne Convention, something clearly not picked up by Prof Flynn.  Schedule 2 has the basis that is set out in the Appendix, but then sets out to expand it, something that clearly falls outside what is allowed by the Berne Convention and TRIPS.

Schedule 2 is not anchored in a provision in the Bill mandating statutory licences, but is incomprehensibly rooted in the formalities provision, S.22, as if the Schedule 2 provisions are expected to appear in every exclusive sub-licence.

It is by no means clear that either the Berne Convention or TRIPS will allow South Africa to avail itself of the flexibilities contained in the Appendix to the Berne Convention.  A solid academic opinion supporting this would have been welcome, but Prof Flynn does not provide it.

Comment:  The amendment to S.6 does not clarify anything.  It introduces the exclusive rights of ‘communication to the public’, ‘making available’ and ‘distribution’ for literary and musical works, and is, together with similar amendments to S.7, S.8 and S.9 (for artistic works, films and sound recordings), the core provisions that are needed to update the Act to the digital age.  However, contrary to the requirements of WCT, these rights were overlooked in respect of computer programmes in S.11B. 

Comment:  Ss. 7 and 9 do not mandate royalty sharing, Prof Flynn is confusing the numbering of clauses in the Bill with the new sections of the Act.  The royalty sharing provisions appear in the new Ss. 6A, 7A, 8A and the amendment to the existing S.9A.

The main object of the Bill is stated to be to benefit the position of South African authors and performers.  By providing for remuneration rights as conditions to the exclusive rights in Ss. 6, 7, 8 and 9, I expect that there will be unexpected consequences arising out of South Africa’s National Treatment obligations under the Berne Convention, TRIPS, and WCT.

The Regulations will prescribe royalty rates as well as the minimum terms of contracts, a development that is bound to have a material impact on how publishing and production agreements are negotiated, likely impacting on contract terms, like advances, that have up to now been commonplace.

Although the object of benefitting authors has been generally supported by all stakeholders, the new Ss. 6A, 7A, 8A and 9A, especially its retrospective provisions and regulatory prescription of royalty rates and minimum terms (none of which is mentioned by Prof Flynn) have been viewed with considerable concern, with at least two professional associations of authors (those who write to earn a living) considering that the benefits of S.6A will be illusory.  With its unnecessarily onerous compliance requirements and the broad exceptions that will cut authors off from remuneration for educational, library and new digital uses of their works, this is not unexpected.

Comment:  The statement is incorrect.  The Bill only amends S.20 to take into account newly defined terms.  The existing law already extends the moral rights of recognition and integrity to all authors of all works.

Many of the exceptions of the Bill, even, surprisingly, the disability exception, take away from the authors’ moral right of recognition, with numerous exceptions requiring the name of the author only to be stated “where practicable.”  In this sense, authors are better off without the Bill.

Comment:  Only Professor Flynn seems to think that this is a good provision.  Both proponents and opponents of the commissioning provisions say that the amendment to S.21 solves nothing.  Instead of simply adapting the default provision and/or allowing a reservation of rights for the author, S.21 introduces complex provisions for setting up agreements between authors and parties commissioning copyright works.

Comment:  This is not a reversionary right as one finds in relation to musical works in Section 203 of the United States Copyright Act, and is not what the Copyright Review Commission intended. This provision, to be added to the current provisions relating to the formalities of assignments, simply states that every assignment of copyright in a literary or musical work shall only be valid for 25 years.  This is irrespective of whether the publisher is marketing the work or not; even irrespective of whether the assignment is made by an author or a successor-in-title.

Comment:  This statement is totally incorrect.  There is no provision in the Act or in the Bill for enforcement of rights outside South Africa. 

S.28 deals with the import of infringing copies and parallel importation.  The amendment to S.28 turns the parallel importation rules on their head with no explanation and permits overseas imports, even re-imports of local goods that have been exported to compete with the locally-produced products.  As such, it will be damaging to South African creators who earn a living from their work.

These observations question the academic soundness of Prof Flynn’s statements.  The history of the involvement of Prof Flynn’s department at the American University Washington College of Law, wrapping itself up in its politically attractive label “Program on Information Justice and Intellectual Property” (“PIJIP”) and jumping from one tactic to another to promote the same outcomes, makes one wonder whether we are truly looking at an objective academic analysis.  Instead, this smacks of lobbying for certain policy positions misappropriating the guise of academic independence, something Prof Flynn and his colleagues have already been accused of in relation to their paper “Evaluating the Benefits of Fair Use: A Response to the PWC Report on the Costs and Benefits of 'Fair Use'.”

In my advice to the Portfolio Committee of the National Assembly at para 2.13, I wrote that “the effect of the Bill will be to weaken copyright so that copyright will cease to be practically enforceable in South Africa, that copyright  will  cease  to  apply  altogether  for  certain  consumers  of  copyright goods,   namely   educational   institutions, Government, libraries, archives, museums and galleries, and the people that they serve, [and] to  benefit  persons  not  specifically  identified  by  the  purposes  set  out  in  Section 12A ...  These persons will no doubt be technology companies whose business models rely on being able to reproduce copyright works without the need for permission or remuneration.” By their support of the Bill, Prof Flynn, PIJIP and Recreate demand nothing less.

The only fitting conclusion of this rebuttal lies in the words of Dr George Ford, that Prof Flynn’s contentions are not relevant for policymaking.

André Myburgh is a South African attorney and qualified as an English solicitor, Foreign Counsel with Lenz Caemmerer of Basel, Switzerland.  He advises the Publishers Association of South Africa and the International Publishers Association, and was appointed to the Panel of Experts on the Copyright Amendment Bill established by the Portfolio Committee for Trade & Industry of the National Assembly of the South African Parliament.

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