Related issues

Competition policy

17.122 The 2000 report of the Intellectual Property and Competition Review Committee, chaired by Mr Henry Ergas (Ergas Committee), recommended reform of s 51(3) of the Trade Practices Act 1974 (Cth)—now s 51(3) of the Competition and Consumer Act.

17.123 The Ergas Committee recommended that the s 51(3) exemption from prohibitions on restrictive trade practices should apply only where agreements do not result, or are not likely to result in, a substantial lessening of competition.[145] The Ergas Committee’s recommendations were largely accepted in the Government’s response to the report, but have not been implemented.[146]

17.124 The ALRC observes that amendment of s 51(3) of the Competition and Consumer Act, as recommended by the Ergas Committee, would tend to strengthen arguments that express statutory restrictions on contracting out are unnecessary. The implications of s 51(3) in relation to copyright licensing are considered in Chapter 6.

Technological protection measures

17.125 Concerns about contracts supplanting copyright law are ‘commonly coupled with concerns that technological forms of protection, such as encryption, will give copyright owners effective control over access to, and uses of, copyright material in digital form’.[147]

17.126 The use and circumvention of TPMs raises similar policy issues to those raised by contracting out. It has been argued, for example, that if parties are not able to contract out of the fair dealing exceptions, neither should copyright owners be able to make fair dealing irrelevant by means of technological access controls.[148]

17.127 Just as the CLRC recommended that the operation of some copyright exceptions should be preserved by statutory restrictions on contracting out, a number of previous reviews have reached similar conclusions in relation to TPMs.

17.128 In 2004, the Digital Agenda Review concluded that the Copyright Act should be amended to provide that ‘any attempt to contractually prohibit the use of a circumvention device or service for the purposes of fair dealing is unenforceable’.[149] In 2006, the House of Representatives Standing Committee on Legal and Constitutional Affairs recommended that an exception for ‘fair dealing with copyright material (and other actions) for criticism, review, news reporting, judicial proceedings, and professional advice’ be included in new TPM provisions of the Copyright Act.[150]

17.129 In the event, the new TPM provisions, subsequently enacted by the Copyright Amendment Act 2006 (Cth) did not contain any such exception, in part because of obligations under the Australia-US Free Trade Agreement.[151]

17.130 In the context of this Inquiry, Universities Australia stated that there is ‘little point discussing how contracts are being used to override copyright exceptions without also discussing how TPMs are being used to achieve the same outcome’, as any legislative solution may be ‘sidestepped’ by rights holders using TPMs to achieve the same purpose.[152]

17.131 Arguably, if limitations on contracting out are implemented, consistent amendments to TPM provisions may be justified. That is, there may be little point in restricting contracting out of exceptions, if TPMs can be used unilaterally by copyright owners to achieve the same effect.

[145] Intellectual Property and Competition Review Committee, Review of Intellectual Property Legislation under the Competition Principles Agreement (2000), 19.

[146] ACCC, Submission 165.

[147] D Lindsay, The Law and Economics of Copyright, Contract and Mass Market Licences (2002), Research Paper prepared for the Centre for Copyright Studies Ltd, 5.

[148] M De Zwart, ‘Technological Enclosure of Copyright: The End of Fair Dealing?’ (2007) 18 Australian Intellectual Property Journal 7, 38.

[149] Phillips Fox, Digital Agenda Review: Report and Recommendations (2004), [1.6].

[150] Parliament of Australia, House of Representatives Standing Committee on Legal and Constitutional Affairs, Review of Technological Protection Measures Exceptions (2006), rec 27, [4.169].

[151]Australia-US Free Trade Agreement, 18 May 2004, [2005], ATS 1 (entered into force on 1 January 2005), art 17.4.7(e)(viii). See M De Zwart, ‘Technological Enclosure of Copyright: The End of Fair Dealing?’ 18 Australian Intellectual Property Journal 7, 21.

[152] Universities Australia, Submission 246. See also, Copyright Advisory Group—Schools, Submission 231; ADA and ALCC, Submission 213; R Xavier, Submission 146.