The Screen Producers Association of Australia submission to the Australian Law Reform Commission in response to the Issue Paper: Copyright and the Digital Economy

Question 1: Australia in the Digital Economy
SPAA believes that Australia’s copyright law is not adversely affecting participation in the digital economy and sees no evidence that copyright law is affecting innovation, imposing unnecessary costs on creators or placing Australia at a competitive disadvantage internationally. 

In providing a response to the Inquiry, SPAA would like to draw attention to the submission made by the Australian Directors Guild and, in particular, their requests to 1) amend section 98 of the Copyright Act to delete the references to “commissioned film” so that copyright royalties flow to directors, and 2) change the Copyright Amendment (Film Directors Rights) Act 2005 to clarify the meaning of “commissioned film” and make the rights of directors absolute unless the director is employed beyond the production of the film. SPAA holds the opinion that directors are already sufficiently acknowledged and remunerated for their contribution to film and television works and does not support any changes to copyright law in regard to this matter for these reasons:
1.	Directors take no risks – Producers almost exclusively wear commercial risks, whereas directors bear no such risk. Any amendments which take rights away from those providing the financial investment in film and television have the potential to act as a disincentive to investment and have a negative economic effect upon the industry.
2.	Creative and Contractual Responsibility – It is as a result of the producer’s relationship with and responsibility for every creative and contractual element connected with the project that the producer is afforded copyright. SPAA sees no reason for an amendment to these provisions so as to create a copyright interest for person who does not assume these responsibilities.
3.	Creative Recognition/Remuneration – Directors sometimes cite recognition of authorship as a reason for a copyright interest. SPAA argues:
a.	Directors already receive significant recognition commensurate with their role;
b.	Directors already enjoy protection of their moral rights under the Copyright Act;
c.	All television and television commercial directors, being employees, are already covered by relevant industrial awards, or the Motion Picture Production Agreement; 
d.	Given the unique nature of the film/TV industry, where many people have input into the final product, it would be inconsistent to grant rights to one group, to the exclusion of others who contribute significantly on a creative level. 
4.	Definition of ‘Director’ – the term director covers a wide range of differing roles in the film and television industry and any blanket rights seeking to cover the entire industry are likely to be unworkable.
5.	Assignability – Producers are the central repositories of all forms of rights in connection with the project and so it is essential for chain of title purposes, and to satisfy investors, for copyright in the project to be amassed in the one entity. SPAA strongly opposes any amendments that fetter or restrict the ability for rights to be assigned.
6.	International Obligations – SPAA submits that there is nothing in any international treaty that requires the Government to provide for a directors’ copyright. 

Questions 3 & 4: Caching and Indexing
Existing laws are adequate in protecting legitimate caching and indexing activity. 

Questions 5 & 6: Cloud Computing
Existing copyright law is in no way impeding the development or delivery of licensed cloud-based computing services and, as such, no new exemptions are required.

Questions 7 & 8: Copying for private use, format shifting
SPAA supports the Screenrights submission in regard to copying for private use and format shifting, specifically, that no changes should be made to existing laws permitting the copying and format shifting of legally acquired copyright material unless there is are provisions for appropriate remuneration. As noted by Screenrights, new exceptions without payment might contravene the Three Step Test established at the Berne Convention and TRIPS and the AUSFTA.

Question 9: Time Shifting
SPAA refers to and supports the joint submission of the Australian Film/TV bodies in regard to accessing copyright material by means of time shifting. In essence, an extension of the format-shifting provisions to allow for internet-based recording services would allow such services to enter into competition with licensed providers and so undermine the ability of rights holders to extract value from digital and online markets (outcomes directly at odds with Australia’s international obligations under the ‘Three Step Test’). “A blanket proposal to allow time-shifting in online environments would diminish the development of authorised online content providers and the capacity of rights holders to extract value in online environments.” 

Question 10: Back-up Copies
SPAA takes the view expressed by the Copyright Council in their submission, that although it is not clear that further exceptions are required for back-up copying, business models are responding to consumer demands and the growth of streaming services is overcoming back-up issues (e.g. an iTunes library roams with the customer on any device). 

Questions 11, 12 & 13: Online use for social, private or domestic purposes
SPAA oppose any exception for ‘social, private or domestic purposes’ and agrees with the Australian Film/TV bodies joint submission that these terms are particularly ambiguous in digital networks and online environments where copyright users may involve many parties and platforms, which over the Internet and in social networks can be extremely extensive. Furthermore, SPAA supports the view expressed by the Copyright Council in their submission, that an Australian exception for the online use of copyright material would have no effect outside of Australia, and commercial interests may better engage copyright material via licensing arrangements. 

Questions 14 to 18: Transformative Use
SPAA refers to and support the submissions by Screenrights and the Copyright Council and agree that the term ‘transformative use’ is too broad and vague and such an exception could significantly impact on a copyright owners’ market for derivative works. As noted by the Copyright council, in defining ‘transformative use’, mere recontextualisation is not sufficient to be transformative; there needs to be creation of new work. 

Question 18: Moral Rights
Any new exceptions should not undermine the operation of the existing moral rights regime. 

Questions 19 to 22: Libraries, Archives and Digitisation
As noted by Screenrights in their submission with regard to libraries, archives and digitisation, Section 183 of the Copyright Act provides a mechanism for government institutions to digitise their collections, so any case for a new exception is tenuous. 

Questions 23 & 24: Orphan Works
SPAA agree with the Copyright Council, that the use, access to and dissemination of copyright works is a mater of individual organisational risk management. 

Questions 28 to 31: Educational Institutions 
In response to the questions concerning the use of copyright material by educational institutions SPAA refers to and supports the submission made by Screenrights. Specifically, SPAA agrees that current copyright laws provide Australian educational institutions with equal, or better, access to copyright audiovisual material than their counterparts in other countries. The Act continues to be effective in the digital age by being technologically neutral, allowing it to remain relevant despite extraordinary technological advances. So there is no reason to allow free use of copyright material to educational institutions, and any copying must be compensated accordingly. 

In response to the submissions by certain educational sector representatives proposing the repeal of Part VA and replacing it with fair use and voluntary licensing, SPAA make the following further comments.
1.	The income received by producers from the Part VA educational statutory licence is a critical economic return for the production sector especially Australian documentary producers.  In the absence of this income, production would be impacted, particularly niche programming such as documentary which is of most relevance to the education sector, and therefore most reliant on the returns under Part VA.
2.	Under the proposed fair use system, education sector representatives have submitted that the sector seeks fair use despite the increased uncertainty that fair use would create.   SPAA’s members do not accept that they should take on this uncertainty.  SPAA submits that the cost of the inevitable litigation required to establish the boundaries of fair use is an unacceptable burden upon producers and creators.
3.	In regard to the voluntary licensing proposed as an alternative to Part VA, SPAA notes that producers may not necessarily have cleared all the underlying rights in productions covering the educational uses currently protected by Part VA, and so it may not be possible for voluntary licensing to replace Part VA.  SPAA notes that this is one of the fundamental reasons for the existence of the Part VA statutory licence.

Questions 32 to 34: Crown Use
In regard to the statutory licensing scheme concerning the use of copyright material for the Crown, SPAA supports the recommendations provided by Screenrights in their submission to the Inquiry. Specifically, Section 183A of the Copyright Act should be amended to allow declared collecting societies to collect for uses other than copying by government, and Section 182B should be amended to enable local governments to rely on Section 183 in the same way as Federal, State and Territory governments. 

Questions 35 to 39: Retransmission of free-to-air broadcasts AND Questions 40 to 44: Statutory licences in the digital economy
The questions about retransmission of free-to-air broadcasts and statutory licences in the digital economy raise many issues for SPAA. Generally, SPAA holds the view that a technological neutral approach to copyright law is the best option and argue that a statutory licencing scheme for the retransmission of free-to-air broadcasts should also apply to retransmission over the Internet. 

SPAA makes the following specific points:
First, we refer to and support the submission made by Screenrights on this matter and agree that there is no basis for introducing a ‘must carry’ regime in Australia, but would support amendments to the Act allowing broadcast copyright use to be remunerated. We agree that while the Act does provide fair compensation, statutory licences offer improved access to content without undermining the economic rights of copyright owners in the digital economy.

And second, we refer to and support the submission made by the Copyright Council on this matter and agree that licensing models are an important option in addressing copyright issues in the digital economy; they reduce the risk of the individual and ensure commercial entities are effectively covered in relevant jurisdictions. We also agree that while there is scope to increase direct licensing, they should not replace statutory licensing, and no statutory licenses should be converted into free-use exceptions. 

Questions 45 to 47: Fair dealing exceptions
SPAA believe that the fair dealing exceptions operate effectively in the digital environment, but also support the Copyright Council view that it may be appropriate to consider a limited exception for non-commercial or private and domestic uses of copyright materials by individuals on the basis of fulfilling a socially useful purpose.

Questions 52 & 53: Fair Use
The introduction of a broad US style ‘fair use’ exception risks contravening our international obligations and may create unnecessary uncertainty. The current fair use provisions comply with international obligations, operate effectively and are well understood. 

Questions 54 & 55: Contracting Out
SPAA agree with the Copyright Council that the relationship between contract and copyright exceptions has become a contentious issue and support the view that licensing models might be a suitable way to address copyright issues in the digital economy.