4. The Protection of Technological Measures (Section 226)
(a) Scope of Circumvention Control
The Position Paper states the Ministry's view that section 226 should retain its focus on copy control measures and not provide legislative protection against the circumvention of technological protection measures {"TPMs") that provide access control. In RIANZ's view, this proposal would, if followed, not be sufficient to implement the relevant requirements in the WIPO Treaties as it would not provide adequate legal protection for, and effective legal remedies against the circumvention of, technological measures .
RIANZ believes that New Zealand will only meet the requirements set out in the WIPO Treaties if the provision on technological measures:
- provides legal protection and remedies in relation to access control, as well as copy control; and
- applies both in relation to preparatory activities (including the manufacture, importation and distribution of circumvention tools and the offering of services for circumvention) and in relation to the act of circumvention itself.
Access control is crucial for the development of new business models in the digital environment and provides a key means for controlling the distribution of music and deterring digital piracy. It is therefore of utmost importance for the right holders and the industries developing TPMs that the integrity of TPMs with respect to both access control as well as copy and use control is protected by national laws. It is also important to consider that without effective legal protection and remedies in relation to both forms of TPMs, New Zealand could risk having consumer access to imported copyright goods restricted.
An adequate level of protection along the lines that RIANZ advocates has been provided for in the European Union Copyright Directive, which requires that European Union members introduce provisions to protect TPMs in relation to both access control and copy control, both in respect of preparatory act as well as the act of circumvention itself. Similar provisions also apply in the United States under the Digital Millennium Copyright Act ("the DMCA"). RIANZ suggests that the preferred approach in New Zealand should be to follow that taken in the European Union and the United States by extending section 226 to cover both access control technology and the act of circumvention.
(b) Exceptions to Section 226
RIANZ notes that the Ministry proposes to introduce certain exceptions in relation to circumvention devices under Section 226 in order to allow users to the exercise permitted acts.
RIANZ has reservations about this approach. The disablement of technological measures and/or the handing over of decryption keys should not be viewed as an appropriate solution to accommodate the exercise of permitted acts for users of copyright content. The purpose of protecting TPMs in the first place would be defeated if users were given a legal mandate to defeat those technologies. As is illustrated by the liberal uses made of existing permitted uses, and the difficulties right holders face in enforcing the strict limits of those provisions, there would be no effective way for right holders to ensure that such exceptions are not used for acts that are clearly not permitted under the law, such as the creation of pirate copies. Without effective means of ensuring that circumvention is only ever undertaken for the prescribed purpose, pirates would simply be further facilitated in defeating TPMs and given a further means to frustrate action taken by right holders to protect and enforce their rights. The provisions for circumvention by users would also arguable be inconsistent to the general obligation set out in the WIPO Treaties, which is to protect technological measures.
RIANZ urges that the Ministry does not adopt a policy position that would provide an exception to section 226 of the Act and allow the manufacture and offer for sale of circumventing devices, the provision of information on circumvention or the undertaking of circumvention itself in order to enable users to benefit from exemptions. In RIANZ's view, right holders themselves are best positioned to find the most appropriate ways of accommodating exemptions and it should be in the right owner's area of responsibility to facilitate the exercise of the permitted act. Any provision for access or copying for the purpose of existing permitted acts provided for in the Act should, therefore, be through the creation of incentives so that the right holders themselves (specifically, the right holder who applied the TPM) provide for access for such purposes, not that users be able to undertake circumvention measures themselves.
Introducing a carve out in section 226 to the effect that that it becomes permissible to circumvent a TPMs or to convey information or any other assistance in relation to circumvention to users, would render the protection of technological measures meaningless. It is impossible in the digital environment to ensure that any carve out to the TPMs provision remains in fact restricted to the legitimate application. In RIANZ's view, such an exemption would only undermine industry efforts to fight digital piracy through technology means. It is vital that copyright law supports these efforts, not frustrates them.
A model for a process that would create powerful incentives for right holders to accommodate certain permitted acts can be found in Article 6 of the European Union Copyright Directive, which requires the right holders provide mechanisms for the exercise of certain exemptions in relation to TPMs. The application of Article 6 (4) includes special protections for the interests of right holders. Importantly, it provides the following limits on the obligation imposed on right holders:
- a mechanism need only apply to allow the beneficiary of a public policy exception to gain legal access to the protected work;
- a mechanism does not have to apply in the case where services are available on demand or on agreed contractual terms;
- a mechanism need only apply to what is strictly required for the enjoyment of the specific public policy exception, where enjoyment would otherwise be hampered by a TPM; and.
- most importantly, a mechanism cannot consist in handing over decryption keys or allowing the circumvention itself.
It is important to note that the provision in the European Union Copyright Directive takes into account the difference between exemptions for public purposes on the one hand (such as educational and library purpose) and private copying exceptions (such as time shifting) on the other. Member States are not obliged to compromise the integrity of technological measures in relation to private copying exemptions.
With respect to rights management information ("RMI"), there is even less practical need to in any way restrict the protection through the provision for the exercise of permitted acts. RMI does not hamper the use of copyright content and RIANZ cannot conceive of a situation where the exercise of a permitted act would require the removal or interference with the integrity of information concerning rights management. RMI is (like TPMs) vulnerable to attack and any carve out for the legal protection required to protect the integrity of such information would compromise the integrity and legal protection for RMI.
RIANZ notes that the Ministry proposes to retain the subjective knowledge requirement already established in section 226 of the Copyright Act and to introduce the same level of knowledge with respect to protection for RMI. RIANZ proposes that this test should imply a "constructive knowledge" element through the introduction of an objective test in order to avoid difficulties proving the infringement of both TPMs and RMI. RIANZ suggests that the phrase "knowing or having reason to believe" be replaced with "knowing or ought reasonably to know" in the same manner as the proposal to amend section 35 of the Act through the Copyright (Parallel Importation of Films and Onus of Proof) Amendment Bill 2002.
(c) Criminal Liability
The WIPO Treaties require effective legal remedies against the circumvention of both TPMs and RMI. Along the lines of the comparable wording used in the TRIPS agreement, expeditious remedies are required to prevent infringement and the applicable remedies are required to be sufficient to constitute a deterrent to further infringement. Without the possibility of criminal sanctions for the violation of technological protection measures, the available legal remedies will not constitute a deterrent. Criminal sanctions that include fines and the possibility of a prison sentence are much greater deterrents than civil remedies, even if those remedies are rarely sought. Of first importance is the signal that criminal sanctions send to potential infringers, and the moral message that the law sends by characterising such activities as being intolerable.
The absence of such criminal provisions would also result in New Zealand copyright law being out of line with Australia, the United States and the great majority of the European countries where criminal sanctions have been introduced in relation to activities concerning the circumvention of TPMs and interference with RMI. New Zealand's international reputation as a country that provides strong and effective anti-piracy and enforcement provisions would therefore be affected by a decision not to introduce criminal provisions.
RIANZ therefore strongly suggests that the Ministry review its preliminary policy position to not establish criminal sanctions.
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