Licensing uses permitted by exceptions

8.54 Like all other users of copyright material, educational institutions, institutions assisting people with disability, and governments should not need to obtain a licence for a use of copyright material that is permitted under an unremunerated exception. This should be clarified in the Copyright Act, particularly if fair use or the new fair dealing exceptions recommended in this Report are enacted.

8.55 The Copyright Act now explicitly provides that certain exceptions do not apply to uses that may be licensed. The exception in s 200AB does not apply if, ‘because of another provision of this Act: (a) the use is not an infringement of copyright; or (b) the use would not be an infringement of copyright assuming the conditions or requirements of that other provision were met’.[65]

8.56 It may be rare for some exceptions, as currently framed, to apply to educational institutions and governments. For example, it should not be surprising that governments cannot rely on the current time-shifting exceptions, because that exception was only intended to be for private and domestic use.[66]

8.57 Some stakeholders submitted that the Copyright Act should clarify that educational institutions and governments may rely on unremunerated exceptions. For example, CAG Schools submitted that if the statutory licences were not repealed, ‘the Copyright Act should be amended to make clear that schools do not require a licence for any use that would otherwise be subject to an exception, including any new fair dealing exceptions’. CAG Schools said it should be ‘made abundantly clear that the mere existence of a licence—whether statutory or voluntary—will not be determinative of whether a use can be covered by a fair dealing provision’.[67]

8.58 Likewise, the NSW Government submitted that the Act should ‘clarify that Governments can rely on fair dealing and other free licences where applicable, and the statutory licence in s 183 is relevant only where no other exception is applicable’.[68]

8.59 It is sometimes argued that where a licence is available, unremunerated exceptions should not apply. If market failure were the only proper justification for unremunerated exceptions, then the availability of a collective licence might suggest that unremunerated exceptions should necessarily not be available. In the ALRC’s view, the availability of a licence is an important consideration, both in crafting exceptions and in the application of fair use—but it is not determinative. Other matters, including questions of the public interest, are also relevant.

8.60 The ALRC considers that it would be unjustified and inequitable if educational institutions, institutions assisting people with disability, and governments could not rely on unremunerated exceptions such as fair use. Statutory licences should be negotiated in the context of which uses are permitted under unremunerated exceptions, including fair use and the new fair dealing exception. If the parties agree, or a court determines, that a particular use is fair, for example, then educational institutions and governments should not be required to buy a licence for that particular use. Licences negotiated on this more reasonable footing may also be more attractive to other licensees.

8.61 This reform, combined with the ALRC’s recommendations for the enactment of fair use and other exceptions, does not imply that the ALRC considers that all uses now licensed under the statutory licences would instead be free under new unremunerated exceptions. There are many uses of copyright material under the statutory licences that would clearly not be fair use or permitted under other exceptions, and for which users will need to continue to obtain a licence.

8.62 It should also be noted that although it is not necessary to obtain a licence for uses that do not infringe copyright, this does not necessarily mean that parties to a licence must agree on the scope of fair use and other copyright exceptions. As Professor Daniel Gervais has written, in a collective licence, ‘rights holders and users could agree to disagree on the exact scope of fair use, yet include some of the marginal uses in the scope of the license and reflect that fact in the price’.[69]

8.63 The Copyright Act provides that if the parties cannot agree on the amount of equitable remuneration, then this can be determined by the Copyright Tribunal. The Act should be amended to provide that, when determining equitable remuneration, the Copyright Tribunal should have regard to uses made in reliance on unremunerated exceptions, including fair use.

Recommendation 8–1 The Copyright Act should be amended to clarify that the statutory licences in pts VA, VB and VII div 2 do not apply to a use of copyright material which, because of another provision of the Act, would not infringe copyright. This means that governments, educational institutions and institutions assisting people with disability, will be able to rely on unremunerated exceptions, including fair use or the new fair dealing exception, to the extent that they apply.