Options for reform

Amend the level of protection

28.52 DP 68 noted that one reform option would be to adopt a sui generis database right similar to that existing in the European Union.^[76] One reason to adopt such a right would be to ensure that Australia could enter into an agreement with the European Union for the reciprocal protection of non-original databases.

28.53 The Attorney-General’s Department submitted that any proposal to adopt sui generis protection in Australia would be likely to meet a significant degree of opposition from within the scientific and academic communities.^[77] In addition, Associate Professor Mark Davison submitted that the database right ‘provides excessive protection and inadequate exceptions and its introduction into Australia is completely unjustifiable’.^[78]

28.54 Another option would be to lower the level of copyright protection of databases to facilitate greater access for third party researchers. One way to achieve this would be to adopt the United States’ standard of originality for copyright, which requires independent creation and a minimum degree of creativity. Those databases that do not fulfil these minimum requirements would not be protected by copyright.^[79]

28.55 Alternatively, Davison suggested that the Copyright Act could be amended to specifically exclude copyright protection for genetic sequences and databases expressed in material form. He suggested that this would have the benefit of harmonising Australian and United States copyright law in this area, and would leave open the possibility of adopting legislation similar to that currently proposed in the United States in relation to database protection.^[80]

Fair dealing for research or study

28.56 Another option is to clarify the scope of the fair dealing exception from copyright infringement for the purpose of research or study.

28.57 The Federal Court has interpreted the terms ‘research’ and ‘study’ in accordance with their ordinary dictionary meanings. ‘Research’ means diligent and systematic inquiry or investigation into a subject in order to discover facts or principles. ‘Study’ has several meanings, including the application of the mind to the acquisition of knowledge, and a thorough examination and analysis of a particular subject. The person who claims the benefit of the fair dealing exception must conduct the research or study.^[81]

28.58 The CLRC has commented that fair dealing reflects a broad balancing of competing goals in order to maximise the public interest. These goals include rewarding creators, increasing investment by copyright industries, and maintaining access to copyright materials. The CLRC stated that ‘a fundamental component of maximising the public interest is allowing the free flow of knowledge, ideas and information’. However, even if copying is carried out for a socially desirable objective, it does not follow that it should be permitted to unreasonably prejudice the copyright owner’s economic rights or other legitimate interests.^[82]

28.59 As noted above, the fair dealing exception applies to the reproduction of copyright works for the purpose of research or study. Section 40(2) outlines the factors to be considered in determining the fairness of a dealing. However, where the reproduction involves an article in a periodical publication, or the copying of a ‘reasonable portion’ of a work only, this is deemed to be fair dealing provided it is done for the purpose of research or study.^[83]

28.60 The Australian courts are yet to determine whether fair dealing for the purpose of research or study applies only to non-commercial research, or extends also to research of a commercial nature.^[84] The CLRC has commented that the distinction between private and commercial activities undertaken for research or study is often unclear and, in its view, ‘the public interest would be maximised if fair dealing for the purpose of research or study did not necessarily exclude some commercial activities’.^[85]

Other jurisdictions

28.61 United States legislation provides for ‘fair use’ of copyright works. The provision is not confined to a specified range of purposes, but outlines factors to be considered in determining whether a proposed use is fair in the circumstances. One of these factors is the purpose and character of the use, including whether such use is of a commercial nature or is for non-profit educational purposes.^[86]

28.62 Until 2003, the United Kingdom permitted fair dealing in copyright works for the purpose of ‘research or private study’. In October 2003, the Copyright, Designs and Patents Act 1988 (UK) was amended to implement the EU Copyright Directive. As a result, fair dealing for the purpose of research or study has been limited to research for a non-commercial purpose.^[87] The United Kingdom’s database right exception for research is similarly limited to non-commercial research.^[88]

28.63 In contrast, a recent Canadian Supreme Court decision held that research of a commercial nature may be fair dealing under the Copyright Act 1985 (Canada).^[89] Chief Justice McLachlin, on behalf of the Court, noted that the fair dealing exception for the purpose of research or private study is ‘a user’s right’ and, in order to maintain the proper balance between the rights of a copyright owner and users’ interests, must not be interpreted restrictively.^[90] His Honour stated that the term ‘research’:

must be given a large and liberal interpretation in order to ensure that users’ rights are not too unduly constrained. I agree with the Court of Appeal that research is not limited to non-commercial or private contexts … Lawyers carrying on the business of the law for profit are conducting research within the meaning of s 29 of the Copyright Act.^[91]

Submissions and consultations

28.64 In order to provide greater certainty for researchers seeking to copy genetic information that is protected by copyright, DP 68 proposed that the Copyright Act be amended to clarify the extent to which fair dealing for the purpose of research or study applies to research of a commercial nature.^[92]

28.65 Many submissions supported the ALRC’s proposal.^[93] The ALRC also heard general support for the proposal in consultations. However, views were mixed as to whether this matter should be dealt with in the context of this Inquiry, or referred for review by another body.^[94] For example, the Queensland Government suggested that the Advisory Council on Intellectual Property should review the matter.^[95]

28.66 The Attorney-General’s Department submitted that an expansion of the existing fair dealing provisions to cover commercial research could, potentially, minimise some of the concerns arising from the protection of factual databases. However, the Department suggested that it would be difficult to envisage a broad exclusion for scientific research that would comply with the Berne Convention.^[96]

28.67 Article 9(2) of the Berne Convention provides that members may legislate to permit the reproduction of copyright works ‘in certain special cases, provided that such reproduction does not conflict with a normal exploitation of the work and does not unreasonably prejudice the legitimate interests of the author’.^[97]

28.68 Professor Sam Ricketson and Chris Creswell have commented that art 9(2) leaves considerable flexibility to national legislators to determine what are ‘special cases’, and how the criteria of conflict and prejudice are to be established. They suggested that this article could justify a wide range of exceptions to the reproduction right, including those contained in the fair dealing provisions of the Copyright Act.^[98]

28.69 Several submissions discussed the difficulty of drawing a distinction between commercial and non-commercial research. For example, Davison emphasised the ‘dangers and, indeed, the impossibility of focusing on a distinction between non-commercial and commercial’ in relation to fair dealing.^[99] The Centre for Law and Genetics suggested that any amendment to the fair dealing provisions should be comprehensive, rather than a ‘sui generis amendment only in respect of commercial genetic research’. In any case, the Centre considered that copyright law is likely to have only a minor role in commercial genetic research.^[100]

28.70 Two submissions supported adopting the United States’ concepts of ‘transformative’ and ‘productive’ use into Australian copyright law.^[101] Section 107 of the Copyright Act 1976 (US) provides that, in determining whether a use is ‘fair’ the factors to be considered include the purpose and character of the use. The concept of ‘transformative use’ refers to the distinction between productive and reproductive uses of a work. A ‘productive use’ makes some contribution of new intellectual value and, therefore, promotes the advancement of the arts and sciences.^[102]

Fair dealing in practice

28.71 DP 68 noted the practical problems that can arise for researchers in seeking to rely on the fair dealing exception from copyright infringement for the purpose of research or study.^[103] Database owners can protect against unauthorised use of their databases through TPMs that prevent access to, or copying of, the database contents. Once a database is protected by a TPM, the database owner could make access or copying subject to contractual arrangements, involving payment of a licence fee.

28.72 As noted above, the Copyright Act does not currently prohibit the use of a circumvention device or service. Accordingly, a researcher could use a circumvention device to avoid the effect of a TPM in order to access a database for fair dealing purposes. However, as dealings in such devices and services are prohibited—subject to exceptions that do not include fair dealing—it would be difficult for a researcher to obtain a circumvention device in Australia for such use.

Previous reviews

28.73 The IPCRC stated that it was broadly satisfied that the regulatory approach to TPMs preserves a reasonable balance between competing interests. However, it stated that it would be concerned if the use of TPMs—perhaps accompanied by greater reliance on contract—were to displace, or in any way limit, the effectiveness of the fair dealing provisions.^[104]

28.74 The CLRC considered the extent to which contract has been used to exclude or modify the copyright exceptions in its report, Copyright and Contract. The CLRC found that contracts have been used for this purpose in Australia and overseas. It considered that, while in many instances it may be reasonable to charge a consumer to access material online, attempts to restrict the reproduction of copyright material for lawful purposes would be problematic.^[105] The CLRC recommended that the Copyright Act be amended to provide that an agreement (or a provision of an agreement) that excludes or modifies the operation of certain statutory provisions—including the fair dealing exceptions—has no effect.^[106] The Australian Government has not yet taken a decision to implement this recommendation.

28.75 Phillips Fox made several reform recommendations in its report, Digital Agenda Review Report and Recommendations. In order to preserve the balance between copyright owners and users, Phillips Fox suggested that the legislative definition of a TPM be limited to measures that protect or control only rights that fall within copyright, and that:

• section 116A(1) of the Copyright Act be amended to prohibit the use of a circumvention device or service to circumvent a TPM, other than for a permitted purpose;

• the permitted purposes in s 116A(3) be amended to permit the supply or use of a circumvention device or service for any use or exception permitted under the Act, including fair dealing; and

• the integrity of the permitted purposes in s 116A(3) be retained by preventing a copyright owner from making it a condition of access to, or use of, a copyright work or other subject matter that a user will not use a circumvention device or service for the purpose of making a fair dealing.^[107]

International instruments

28.76 In 1996, the World Intellectual Property Organization (WIPO) adopted two new treaties. The WIPO Copyright Treaty and WIPO Performances and Phonograms Treaty (WIPO Internet Treaties) establish new international legal standards to address issues arising in the digital environment. Australia has agreed to ratify or accede to these treaties by the date the AUSFTA enters into force.^[108]

28.77 The WIPO Internet Treaties require member States to provide adequate legal protection and effective legal remedies against the circumvention of TPMs that are used by copyright authors to restrict acts, in respect of their copyright works, which are not authorised by the authors or ‘permitted by law’.^[109]

Australia–United States Free Trade Agreement

28.78 Under the AUSFTA, Australia has agreed to prohibit the circumvention, without authority, of effective TPMs that control access to a copyright work; and commercial dealings in circumvention devices and services.^[110] The AUSFTA provides an exhaustive list of permitted exceptions to these prohibitions, which does not include fair dealing.^[111] Once implemented, this would bring Australian copyright law into conformity with United States law.^[112]

28.79 Australia may provide an exception to the prohibition on circumvention of access control measures for non-infringing uses of a work—in a particular class of works—if an actual or likely adverse impact on those uses is credibly demonstrated in a legislative or administrative review or proceeding. These ‘reviews or proceedings’ must be conducted at least every four years.^[113]

Submissions and consultations

28.80 DP 68 asked whether the Commonwealth should amend the Copyright Act to provide that, in relation to genetic databases protected by copyright, the operation of the provisions for fair dealing for the purpose of research or study must not be excluded or modified by contract or TPMs.^[114]

28.81 A number of submissions supported this approach.^[115] Several submissions suggested that this would be consistent with the approach taken in relation to the research use exemption from patent infringement.^[116] The Department of Industry, Tourism and Resources expressed support ‘subject to the availability of empirical evidence that a problem exists’.^[117]

28.82 The Caroline Chisholm Centre for Health Ethics commented that this is a difficult area in which to achieve a balance of interests, and accordingly needs careful monitoring in the future. The Centre noted that, given the importance of genetic databases in healthcare and medical research, excluding researchers from these research tools through restrictive licensing ‘would appear contrary to progress in this field and certainly not in the public interest’. However, it also recognised that ‘compiling genetic databases is time consuming, and recompense for the effort is warranted’.^[118]

28.83 The Queensland Government considered that further investigation was necessary to determine the possible impact of the AUSFTA on the ALRC’s proposed approach and possible administrative problems that may arise from it. It suggested that encouraging education or research licensing arrangements in which the owner provides a ‘key’ to unlock access to the database would be more effective, and would allow Australia to become more aligned with overseas jurisdictions. It noted that its own consultations had raised the suggestion that a Commonwealth body should operate a scheme in which copyright users would be required to notify the body before exercising fair dealing in relation to such databases.^[119] The Centre for Law and Genetics suggested that ‘it would be inappropriate to make specific recommendations dealing only with genetic databases’.^[120]