Part Two: The Reproduction Right
A. Issue Summary
33. The Act provides copyright owners with the exclusive right to copy a work. 5 "Copying" is defined as including reproducing or recording a work "in any material form" and, in relation to a literary, dramatic, musical, or artistic work, "storing the work in any medium by any means". 6
34. Two issues arise:
35. Whether the existing definition of copying is broad enough to allow copyright owners to prohibit unauthorised copying of material in digital form and the conversion of print or analogue works to digital form ("storage and digitisation").
36. Whether the definition of copying should be amended to address explicitly incidental and temporary copies that are automatically made by computers and communications networks as a result of technical processes ("transient copying"), for example, caching or the creation of a history file.
B. Perspective and Proposed Policy Response
(i) Storage and Digitisation
37. The Ministry considers that the scope of the current reproduction right (and the definition of copying) is sufficient to allow copyright owners to control the digital reproduction of their works. Analysis suggests that digital copying (and first digitisation) is already covered by the existing technology-neutral definition of copying ("reproducing or recording a work in any material form"). 7
38. On this basis the Ministry's preferred policy response is to leave the current definition of copying in section 2 of the Act unchanged. We are, however, mindful of suggestions that greater certainty could be provided through a specific reference that "material form" includes digital formats. The Ministry is also concerned to ensure that any specific reference to digital copying does not call into question whether other forms of storage constitute copying and thereby jeopardise the continued technological neutrality of the definition of copying.
39. We, therefore, seek views on how the suggested change in respect of "material form" might be drafted. The Ministry's preliminary view is that it could be achieved by amending the current definition of copying to state that material form includes digital formats, rather than inserting a separate definition for material form, which is currently not defined. We do not favour the seemingly more complicated approach taken in the Australian Copyright Act 1968 (Cth) which contains an extensive definition of "reproduction" and provides explicitly that a work is taken to have been reproduced if "converted into or from a digital or other machine-readable form". 8
40. Our analysis of submissions on the 2001 discussion paper also suggests that there is some confusion concerning the relationship between the first two paragraphs of the definition of copying ((a) and (b)) in section 2 of the Act. Subsection (a) widely defines copying in relation to all categories of works. It states that reproducing or recording the work in any material form will constitute copying. Subsection (b) clarifies the extent of the definition in subsection (a) in relation to literary, dramatic, musical and artistic works only. It provides that in relation to these works, storing the work in any medium by any means will constitute copying. This seeks to resolve any question that might arise concerning whether the storage of these types of works is in a material form for the purposes of the definition. For example, a work stored in an electronic form cannot be viewed in a tangible form yet it is considered to be in a material form.
41. Subsection (b) does not need to include other categories of works (sound recordings, films, broadcasts, cable programmes). Frankel and McLay suggest that one way of distinguishing these works is that they all involve some form of technological communication and that the underlying works contained in the communication may also independently attract protection as literary, dramatic, musical or artistic works. As a consequence, copyright in these other categories of works protects the actual communication or representation of the underlying works (for example, as digital code or signals), rather than the content of the communication. 9
42. The Ministry suggests that any confusion concerning the interpretation of these subsections could be addressed by amending the provision so that paragraph (b) is a subset of (a), thereby making it clear that "material form" may include storage, but does not necessarily have to.
43. Please note that exceptions to the reproduction right are considered separately in the section on permitted acts.
(ii) Transient Copying
44. The Act does not expressly address the question of whether the making of temporary or incidental copies, which are often a result of the automatic operation of digital technologies, such as computer and communications systems, infringes the exclusive right of a copyright owner to authorise copying of copyright material.
45. The Ministry considers that the current definition of copying is sufficiently broad to include transient copying. Liability for unauthorised copying could, therefore, arise in relation to transient and incidental copies. For example, copies created in a computer's random access memory ("RAM") when a user browses the World Wide Web may give rise to infringement. It has been argued that this is in essence the digital equivalent of the "right to read" in the analogue environment. The argument that RAM copies are transient and, therefore, not reproductions (because they disappear when a computer is switched off) has generally been unsuccessful in the courts. This has implications for individual web users and Internet service providers. It has been suggested, therefore, that the Act should expressly state whether or not transient copying forms part of the copyright owner's exclusive reproduction right.
46. There was general agreement from respondents to the 2001 discussion paper that liability should not arise for transient copying that is automatic, part of a technical process and is to allow the functioning of an otherwise authorised act. Not all transient copying, however, is automatic and part of a technical process. It is also not clear what uses (perhaps commercial) may be made of transient copies as technology develops. The Ministry considers that whether copying is temporary or permanent is not necessarily a useful yardstick by which to measure whether infringement has occurred. Rather, it is the purpose of the copying that should be considered.
47. Applying the copyright policy framework, the Ministry considers that it is highly doubtful that protecting transient copies that are automatic and part of a technical process would play a significant role in encouraging the creation of new works. The social cost of providing such a right cannot be justified on grounds of economic efficiency, as the cost of protection to society (for example, a disincentive to Internet use) would not be offset by any gains in the value to the public interest.
48. Having concluded that some transient copying should not give rise to liability for copyright infringement (depending on the purpose of the copying), two options arise: amend the definition of copying so that some forms of transient copying are deemed not to be copies, or provide exceptions for some forms of transient copying.
49. The Ministry's preferred policy response is that transient copying continue to be included within the broad definition of copying, but with a specific purpose-based exception. An exception directed towards copying automatically undertaken as part of a technical process involved in making an authorised use of a work attracted general support from respondents commenting on the 2001 discussion paper. The Ministry proposes that such an exception only apply to transient copies that have no independent economic significance. 10
50. Consideration of the above option would, however, require further work concerning the definition of "technical process". The Ministry seeks suggestions from respondents on how this issue might be addressed. For example, creating exceptions for:
- temporary reproductions as part of the technical process of making or receiving a communication (as in Australia11);
- copies that "technically required for the viewing of or listening to a work by a member of the public to whom a copy of the work is lawfully made available" (as in Ireland12).
51. A key question to be addressed in this context is the degree to which technical processes should be linked to communication processes, or should apply more generally. The Ministry suggests a wider approach, not limited to communication, for example, so that temporary storage in RAM for the purpose of executing a computer program or game does not constitute infringement.
52. The Ministry does not favour an approach that excludes transient copying from the definition of copying. It is suggested that the "exceptions" rather than the "definition" approach to this issue provides a more technology-neutral solution, which acknowledges that not all transient copying is automatic or for purely technical purposes and should not be exempted from the copyright owners exclusive reproduction right.
53. The issue of Internet service provider liability, and exceptions more generally, are dealt with in Part Four of this paper.
5 Copyright Act 1994, section 16(1)(a).
6 Ibid, section 2(1) - definition of "copying".
7 The Electronic Transactions Act 2002, section 34 provides that the copyright in a work is not infringed by the generation of an electronic form of a document or the production of information by means of an electronic communication if these acts are carried out for the purposes of meeting a legal requirement.
8 Copyright Act 1968 (Cth) (Australia), section 21(1A).
9 Frankel and McLay, Intellectual Property in New Zealand (LexisNexis Butterworths, 2002) p 169.
10 See Article 5 of the European Union Directive on the Harmonisation of Certain Aspects of Copyright and Related Rights in the Information Society (2001/29/EC, 22 May 2001) ("Copyright Directive"). The mandatory exception to the exclusive reproduction right for transient copies will only apply where they form an integral and essential part of a technological process and have no independent economic significance.
11 Copyright Act 1968 (Cth) (Australia), section 43A.
12 Copyright and Related Rights Act 2000 (Ireland), section 87(1).
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