NSW – Response to Issues Paper:
Copyright & the Digital Economy
Table of Contents
Introduction
Defined terms
The Inquiry
Guiding Principles for Reform
Library Exceptions
Crown Use of Copyright Material
Legislation and Background
Problems With the Government Statutory Licence generally
Problems With the Operation of s. 183A
Reform
Governments Performing Statutory Obligations
Environmental Planning and Assessment Act 1979  (“EPA Act”)
Government Information (Public Access) Act 2009 (“GIPA Act”)
Reform
Material on Public Registers
Statutory Licences in the Digital Environment
Context and Comparisons
Reform
Fair Dealing Exceptions
Other Free-Use Exceptions
Fair Use
Contracting Out
Introduction
1.	This submission does not respond to all of the questions raised in the Issues Paper. Rather, it focuses on the matters of most concern to NSW. NSW considers that there are serious problems with the Government Statutory Licence, and with the operation of some of the Free Exceptions.
Defined terms
2.	In this submission the following definitions are used:
APRA:	Australasian Performing Right Association, a Collecting Society concerned with performance and communication of music and lyrics.
CAL: Copyright Agency (formerly Copyright Agency Ltd). CAL’s members are publishers and copyright owners of Copyright Works.
CAL Agreements: The remuneration agreements that have been made between NSW and CAL.
CAL v NSW FCA: Copyright Agency Ltd v New South Wales 159 FCR 213
CAL v NSW HCA: Copyright Agency Ltd v New South Wales 233 CLR 279.
Collecting Society/ies: The copyright collecting societies operating in Australia or any one of them, including the Declared Societies, Australasian Performing Right Association (APRA), Phonographic Performance Company of Australia (PPCA) and Viscopy. 
Copyright Act: The Copyright Act 1968 (Cth).
Council: A council constituted under Division 1 of Part 2 of the Local Government Act 1993 (NSW).
Declared Collecting Societies: Collecting Societies that have been declared by the Copyright Tribunal, under s. 153F of the Copyright Act, to be Collecting Societies for the purposes of Division 2 of Part VII of the Copyright Act. These are CAL and Screenrights.
Copyright Material: Copyright Works and other subject matter protected by copyright (including films, sound recordings and broadcasts).
Copyright Works: Literary, artistic, dramatic and musical works as defined in the Copyright Act.
EPA:	The Environmental Planning and Assessment Act 1979 (NSW).
External Material: Copyright Material in which NSW is not the copyright owner, whether or not it is the subject of an Online Agreement.
Free Exceptions: The exceptions to infringement within the Copyright Act for which no remuneration is payable, including the “fair dealing” exceptions in Division 3 of Part III and Division 6 of Part IV and the Library Exceptions.
FTE:	Full Time Equivalent staff, an amount calculated by converting work load hours into the number of people required to complete that work.
GIPA Act: The Government Information (Public Access) Act 2009 (NSW).
Government/s: The Commonwealth, State and Territory Governments, or any one of them.
Government Agency: A department, statutory body or other agency that is legally part of a Government.
Government Statutory Licence: The statutory licence for use of copyright material by Governments in Part VII of Division 2 of the Copyright Act.
Library Exceptions: Division 5 of Part III and sections 110A-110BA and 200AB of the Copyright Act.
NSW: The Crown in right of the State of New South Wales, and all statutory bodies and other entities that are legally part of the Crown in right of the State of New South Wales.
NSW Agency: A department, statutory body or other agency that is legally part of NSW.
Online Agreements: Agreements under which a publisher grants NSW or a NSW Agency access, and a licence to use, Copyright Material published online.
s. 183A Agreement: A remuneration agreement between NSW and a Declared Collecting Society for the purposes of s. 183A of the Copyright Act.
Screenrights: A copyright collecting society which collects payments for use of broadcasts and broadcast material. 
Third Party Material: Copyright Material in which NSW does not own copyright, and for which NSW has not obtained a copyright licence from the publisher or copyright owner.

The Inquiry  
Question 1.	The ALRC is interested in evidence of how Australia’s copyright law is affecting participation in the digital economy. For example, is there evidence about how copyright law:
(a)	affects the ability of creators to earn a living, including through access to new revenue streams and new digital goods and services;
(b)	affects the introduction of new or innovative business models;
(c)	imposes unnecessary costs or inefficiencies on creators or those wanting to access or make use of copyright material; or
(d)	places Australia at a competitive disadvantage internationally.
3.	Governments have had to adapt their business models and practices to meet public expectations in the digital era. It is now a public expectation that Governments will have sophisticated websites and presence on social media. The content on a Government Agency’s sites is expected to include comprehensive information about the Agency’s areas of activity, and matters relevant to that activity, options for lodging applications and complaints, for access to public records and for making transactions online. Many such sites invite the public to provide comments and suggestions on issues relevant to the Agency’s activities.
4.	Internal services and activities of Governments also need online access to Copyright Material. For example, emergency services need access to databases with current information about the areas they serve; health, community and emergency services need to provide training and current awareness material to staff; policy officers and other researchers need to share ideas and information. 
5.	Providing such material online through websites is no longer seen as new or innovative: it represents the degree of service, and openness, that is now expected of Governments and public authorities. However, to the extent these activities require use of Third Party Material, the Copyright Act legally prevents entities (such as Councils) from providing such material online; and impedes NSW Agencies from doing so because this could make them liable for unpredictable but potentially large amounts of remuneration. The Copyright Act thus seriously impedes the distribution of information and provision of services, for public interest purposes, by NSW Agencies and Councils. This has implications for public administration, public involvement in Government decision-making and the transparency of Government actions and decisions.
Guiding Principles for Reform
Question 2.	What guiding principles would best inform the ALRC’s approach to the Inquiry and, in particular, help it to evaluate whether exceptions and statutory licences in the Copyright Act 1968 (Cth) are adequate and appropriate in the digital environment or new exceptions are desirable?
6.	The guiding principles should include the public interest in the free flow of important information. Efficient public administration, sound decision making and the democratic principle of public participation depend on the public being able to access relevant information. This was highlighted in the High Court decision in Lange v ABC (1997) ALR 96 at 107. 
7.	Secondly, any amendments to the legislation must make it simpler and clearer. The current consolidation of the Copyright Act is almost impossible to decipher for anyone who is not a specialist in the area. It is incoherent, illogically set out and includes large passages that have little or no effect (such as the provisions concerning film directors’ copyright). Any amendments recommended by the ALRC should aim to improve the clarity of the Copyright Act overall.
8.	A further but related principle is that any amendments should avoid placing complex and arbitrary conditions on users.  In their current form, the statutory licences and the Library Exceptions are highly complex and it is almost impossible to comply with them fully. Some of the administrative requirements, such as elaborate record keeping rules, appear to have no practical function or benefit for copyright owners. The Government Statutory Licence requires Governments and Declared Collecting Societies to devise sampling surveys, but provides scant guidance, resulting in an onerous, unpredictable, costly burden on Governments. Any recommendations by the ALRC should aim to simplify, or at least not further complicate, the conditions for reliance on exceptions and statutory licences. 
Library Exceptions
Question 19.	What kinds of practices occurring in the digital environment are being impeded by the current libraries and archives exceptions?
9.	The amendments made by the Copyright Amendment (Digital Agenda) Act 2000 (Cth) effected the rudimentary change of extending the Library Exceptions in the Copyright Act, to allow libraries to provide copies to clients by electronic means as well as by hard copy. However, the amendments did not address the enormous changes in research practices and in the roles of libraries and librarians. The Library Exceptions appear to be still based on the assumption that libraries hold most of their material in unlicensed form, and that the librarian’s role is largely to provide individual copies to clients at their request. As a result, the Library Exceptions play a diminishing role.
10.	Librarians and knowledge managers play a far more active role in the digital world than they did previously. Their skills are in high demand, and they may do extensive research and provide services proactively rather than waiting for requests. 
11.	At a basic level, most libraries provide some form of “current awareness” service, alerting their clients to new acquisitions and to material in their area of interest, often by emailing copies of the contents page. Even this basic level of service is not always covered by the current Library Exceptions. Where contents pages include copyright works such as photographs, illustrations or detailed abstracts of articles, no exception to infringement applies (except for libraries in Government Agencies, which can rely on the Government Statutory Licence, at a price).
12.	Libraries still acquire printed publications, but they increasingly acquire resources in digital and online forms. Procurement of online resources, and management of the agreements, has become a major part of librarians’ role. Where online publications are acquired under licence agreements, the exceptions in the Copyright Act are of limited relevance. Some agreements may leave space for the Copyright Act exceptions to operate, but in many cases those exceptions are excluded by the terms of the agreement. There are several consequences:
•	Where Online Agreements preclude supply of inter-library copies under ss 49 and 50 of the Copyright Act, a requesting library would need to locate a library holding the publication in print form in order to get a copy of a requested article. However, in some cases, there may be no library in Australia that holds the publication in print form; moreover, some publications are no longer published in print form. In such cases there is no room for the Library Exceptions to operate, and library users may be unable to access the affected material.
•	Where Online Agreements displace the exceptions in the Copyright Act, publishers could begin to charge users for non-copyright uses such as viewing pages, even where the user does not print or download the pages.
•	Librarians are increasingly required to police their clients’ compliance with Online Agreements. This is a significant responsibility, especially as some libraries have a large number of Online Agreements, with a variety of terms and conditions. Terms and conditions of Online Agreements may require libraries to prevent users other than staff members (or registered users) from accessing the licensed resources.
•	Libraries may have limited ability to control their clients’ actions, but nonetheless may suffer severe consequences (such as interruption or termination of access to the material) if a client contravenes terms and conditions of an Online Agreement (for example by exceeding download limits).
•	Some Online Agreements do not allow libraries to keep archived material once the library ends its subscription. As a result, when a library stops subscribing to a publication, a publication is discontinued or a publisher closes down, the library may lose access to the material it has paid for. (Services are available to hold such material in archives: for example, www.portico.org. However, their legal status is unclear).
13.	Solutions to the problems with the Library Exceptions will not be found simply by considering amendments to the current provisions. With the increasing proportion of material that is acquired in digital-only format, the scope of the Library Exceptions could become limited to the print publications in library collections. There is a risk that Online Agreements will become the sole determinants of whether or not a library’s clients can access the most current and important resources. Given the restrictions currently imposed by such agreements, and the annual increases in fees charged by publishers, current issues of important and up-to-date publications could become available only to those who are wealthy or can pass on the costs to clients.
14.	A review of the Library Exceptions must take into account the importance of aggregators, as well as publishers, in controlling access to Copyright Materials online. 
15.	In terms of the principles that should guide the ALRC’s work (see response to Question 2), the current situation is likely to impair the free flow of information of public importance.   
16.	There may be some overlap between the issues raised here and the Legal Deposit requirement, which is, of course the subject of a separate inquiry by the Commonwealth Attorney General’s Department: 
www.ag.gov.au/Consultationsreformsandreviews/Pages/Extending-Legal-Deposit.aspx  
Crown Use of Copyright Material
Question 32. Is the statutory licensing scheme concerning the use of copyright material for the Crown in Div 2 of Part VII of the Copyright Act 1968 (Cth) adequate and appropriate in the digital environment? If not, how should it be changed?
17.	NSW considers that there are significant problems with the Government Statutory Licence.  
18.	Technological developments have changed copying practices in NSW Agencies, in particular by the increasing use of intranets and electronic storage of documents. 
19.	NSW Agencies now spend millions of dollars every year on Online Agreements. Such agreements determine the usage and copying rights of Governments in relation to the licensed material, largely to the exclusion of the Copyright Act.  
20.	The range of material covered by the Government Statutory Licence is correspondingly reduced. Material covered by the CAL Agreements is, in broad terms, limited to print publications and digital format publications that are not covered by Online Agreements or permissions. The latter category is likely to consist mainly of material taken from websites and used outside the terms of any licence granted by the website proprietor. Anecdotally, it is likely that use of such material is thinly spread across NSW Agencies. 
21.	However, although the number of copies of Third Party Material made by Governments is likely to be much lower than in earlier years (at least to the extent it consists of copyright works), the requirements of the Government Statutory Licence remain administratively and financially onerous. 
Legislation and Background
22.	Section 183 of the Copyright Act allows Governments to do “any acts comprised in the copyright if the acts are done for the services of” that Government. Governments are obliged to notify the copyright owner or owners of the use, and to negotiate the terms. This may appear at first glance to place Governments in a privileged position compared to other copyright users. However, the obligations imposed on Governments under the Government Statutory Licence are so great that in practice Governments may be subject to more complex administrative procedures, and greater liability for payments, than entities using copyright material for entirely commercial purposes. 
23.	Section 183A modifies the general effect of the Government Statutory Licence. For copies covered by a Declared Collecting Society, Governments are excused from the obligation to deal directly with the copyright owners but must instead enter a remuneration agreement with the Declared Collecting Society. Section 183A(2) requires Governments to pay the Declared Collecting Societies “equitable remuneration” for Government copies made within a particular period. The method of working out equitable remuneration under s. 183A must take into account the estimated number of Government copies, and the agreement must specify the sampling system used for making the estimate. Remuneration is to be worked out using a method agreed on by the Declared Collecting Society and the Government, or failing such agreement, determined by the Copyright Tribunal.
24.	Section 183A covers many dealings by governments with Third Party Material, but does not apply to activities other than copying. Governments must still notify copyright owners when they publish, adapt or publicly perform Third Party Material or when they communicate Third Party Material to the public. 
25.	Governments may also enter “voluntary” agreements with non-declared Collecting Societies. Governments are not legally obliged to enter such agreements, but may decide to do so if their Agencies make use of the relevant type of material and this is an efficient way to discharge the liability. For example, NSW has made an agreement with APRA, in which a number of NSW Agencies have chosen to participate.
Problems With the Government Statutory Licence generally
Who is “the State”?
26.	The drafting of s. 183 directs attention to the question whether or not an entity is legally part of “the State”. This can be a difficult question to answer.
27.	There are many different structures and entities that Governments may use to carry out their activities. Over time, Governments may re-structure an entity or area of activity for various reasons (for example by replacing a Division of a Government Department with a statutory body or State-Owned Corporation performing the same functions). 
28.	As a result, there may be substantial variation between jurisdictions, and within jurisdictions over time, as to the kinds of activity for which they are liable to pay remuneration under s. 183, depending on the structure and type of entity each Government has chosen to use in carrying out that activity. 
Application of Free Exceptions
29.	Collecting Societies have on some occasions argued that Governments should not be entitled to rely on the Free Exceptions. The High Court in CAL v NSW HCA appeared to reject that view, noting:
30.	“11.	The State did not suggest that any of the fair dealing provisions (ss 40-42) or other provisions in Pt III, Div 3 (ss 43-44F) which provide that certain acts do not constitute an infringement, had any application to the uses of the survey plans described below. In cases where these provisions do apply, Pt VII, Div 2 respecting Crown use and equitable remuneration is not engaged.”  
31.	It would be preferable to make the legislation explicit on this point. 
32.	A further issue is that, without information about the circumstances of the making of a copy, it is often impossible to determine whether or not it was made under one of the Free Exceptions. It is therefore likely that some proportion of the payments made by Governments to CAL is referable to copies made within the terms of Free Exceptions. 
Implied Licences
33.	Following CAL v NSW HCA, there is some doubt as to when Governments may be entitled to rely on implied licences. 
34.	The High Court took care to distinguish “private uses” of survey plans (such as registration of the plan, and issue of title over the land) from subsequent “public uses” (at [82] to [93]). The Court noted that NSW’s use of the plans for private uses was “not dissimilar to the uses under consideration in the implied licence cases” (at [84]) and that CAL did not seek remuneration under s. 183(5) for such uses. This appears to leave open the possibility that NSW may have an implied licence in relation to the private uses; or alternatively, that such uses are within s. 183(1) but the remuneration under s. 183(5) should be nil.
35.	In relation to the “public uses” of the plans by NSW, the basis of the High Court’s decision may be summarised as follows (at [84]-[91]):
•	Surveyors do not abandon their exclusive rights by preparing and lodging plans, “particularly since the statutory licence scheme qualifies those exclusive rights on condition that remuneration be paid for permitted uses”.
•	Surveyors cannot practise their profession without consenting to the post-registration public uses of their plans.
•	The post-registration public uses of the plans do not undermine or impede the clients’ interest in lodgement of the plans and register of title.
•	Surveyors and their clients cannot be expected to factor into their agreements any payment for post-registration public uses of the plans.
•	NSW charges fees to the public for providing copies of the plans.
•	There is no basis for reading down s. 183(1) to exclude acts done by NSW pursuant to express statutory obligations.
36.	The High Court concluded: 
“91.	These considerations all militate against implying a licence, as a matter of law, into all contracts between surveyors and their clients, in favour of the State, which is a stranger to such contracts. They also militate against the founding of any licence in an authority or consent given by the surveyors to the State, independently of the contracts between the surveyors and their clients.
92.	Finally, and importantly, a licence will only be implied when there is a necessity to do so. As stated by McHugh and Gummow JJ in Byrne v Australian Airlines Ltd: 
This notion of 'necessity' has been crucial in the modern cases in which the courts have implied for the first time a new term as a matter of law. 
93.	Such necessity does not arise in the circumstances that the statutory licence scheme excepts the State from infringement, but does so on condition that terms for use are agreed or determined by the Tribunal (ss 183(1) and (5)). …”. [Footnotes omitted.]
37.	There is room for argument about how broadly the decision should be interpreted. Certainly, the decision does not justify a view that a State could never rely on an implied licence. The Court appeared to accept that an implied licence may be present in respect of the “private” uses, as noted above. The Court had already noted that s. 183 does not apply where a Free Exception is engaged (see above, para 27). 
38.	Nonetheless, it would be helpful to clarify that the statutory licences have effect only in the absence of express or implied licences, and where no Free Exceptions are relevant.
Problems With the Operation of s. 183A
Sampling Surveys
39.	At the time s. 183A was introduced, the then Attorney General, the Hon. Darryl Williams, stated the intention was to provide “an administratively simple procedure” for Government Agencies to use Copyright Material without unreasonable limitations and pay “equitable remuneration” to copyright owners. In practice, the scheme established by s. 183A has proved to be cumbersome, burdensome and costly, and insufficiently flexible to adapt to technological advances. 
40.	This issue has been especially problematic in relation to the CAL Agreements. In the CAL Agreement dated 14 March 2005, “Equitable Remuneration” was defined as “the amounts payable by the State or each Department or Agency under this Agreement and calculated in accordance with” specified provisions of the Agreement. Separate methods were set out for calculating payments for copying of print music and for copying of other Copyright Works. For the latter, the calculation was based on the application of an agreed rate to the number of FTEs in NSW Agencies each year. The rate was determined on the basis of a sampling survey conducted by an independent consultant, at substantial expense.
41.	Designing a sampling survey is a complex task requiring specialist knowledge and skills in the areas of statistics, copyright law, Government systems and administrative and copying practices. The Copyright Act provides little guidance. 
42.	Since the 2005 agreement, the State and Territory Governments have been unable to reach agreement with CAL on a sampling survey design. In 2010, recognising that achieving an acceptable sampling system was still some way off, NSW entered an agreement with CAL providing solely for remuneration. That agreement was extended to 2012. Currently NSW has no agreement with CAL in place.
Negotiating Equitable Remuneration
43.	The expression “equitable remuneration” is of considerable importance in the statutory licences, but it is not defined in the Copyright Act. 
44.	It is noticeable that s. 183 does not use the expression “equitable remuneration”. Instead, s. 183(5) states that the terms for the use of the copyright material are to be agreed between the Government and the copyright owner, or failing such agreement, to be set by the Copyright Tribunal. On the other hand, where declared collecting societies administer the statutory licence, s. 183A states that Governments are to pay equitable remuneration to the copyright owners. 
45.	It is not clear what distinction is intended by the use of different terminology. The Copyright Tribunal has described “equitable remuneration” as:
“remuneration that is fair and reasonable or, put differently, remuneration that is just in all the circumstances. … So, the appropriate remuneration must be fair to the copyright owner whose rights are being appropriated, in terms of the value to the licensee of having access to his material.  It must also be fair to the licensee, so that, for example the remuneration should not be greater than the damages that would be paid if, instead of acting lawfully, the licensee had misappropriated the owner’s copyright.” Copyright Agency Limited v Queensland Department of Education [2002] ACopyT 1; (2002) 51 IPR 19(CAL v QLD) at [13] (Finkelstein DP).
46.	The Tribunal noted further (at [85]):
“An appropriately fair remuneration here is not the same remuneration that would be determined by the interaction of buyers and sellers who wish to exchange some service [or good] in a market where the buyer tries to obtain it as cheaply as possible and the seller tries to obtain as much as possible for it.  In the first place we are not dealing with a market.  The right to take copies of copyright work is conferred by statute.  Second, and this is really the point I wish to make, the institutions for whom the copies are being made are educational institutions, and the purpose of the copying is to educate students more effectively.  Further, with few exceptions, the educational institutions are non-profit organisations.  Whilst acknowledging the force of the view expressed by Sheppard P in the First Schools case that authors should not be required to subsidise educational institutions, it nevertheless remains true that Parliament thought it appropriate to limit the monopoly conferred upon authors, so that the monopoly would not inhibit the proper education of Australian students in an increasingly complex world of ideas.  The public benefit of the statutory licence should not be underestimated.  Setting a rate which would inhibit its use will be positively detrimental to the public welfare.”
47.	This is one of several factors indicating that the policy behind the Government Statutory Licence, as well as the drafting of the provisions, should be reviewed and amended. 
Obligation to Make Agreements With Collecting Societies
48.	Unlike other copyright users, Government agencies are not entitled to make a commercial decision on how to manage their copyright liabilities, but must enter agreements with the collecting societies in accordance with s.183A or face litigation. The legal obligation remains even if a Government does no copying under s.183. 
49.	The range of material covered by s. 183 is diminishing. Books, journals and similar material are increasingly delivered online under agreements that include copyright licences, as noted above. Digital technology and he advance of ebooks have changed the shape of the publishing industry, and major publishers have incorporated many of the smaller publishing houses. The combined effect is that Governments increasingly deal directly with publishers, and those agreements now cover most of the External Material used by Government staff. NSW Government Departments spend millions of dollars annually on such agreements. 
50.	Because of the difficulty of designing a practicable sampling survey for copyright works, the fees paid by NSW in recent years have not been based on estimates of the number of Government copies made. It is likely that some of the amounts Governments have paid under s. 183A are attributable to licensed material for which they have already paid under direct licence agreements with the publishers. 
Powers of Collecting Societies
51.	Section 183C authorises a declared collecting society to carry out sampling on Government premises. The Government is entitled to object only if it proposes an alternative time or place. 
52.	The section does not state how, or by whom, any such objection is to be determined. It does not appear to be among the matters that can be referred to the Copyright Tribunal. Nor does the section provide for considerations of confidentiality, privacy, security or obligations regarding State Records to be taken into account. It appears not to have been the subject of judicial consideration: but it would need substantial reading down to make it acceptable. A preferable course of action would be simply to repeal this provision. At the very least it should be amended: for example to allow Governments to protect secret, confidential and other sensitive material, and to disallow actions by collecting societies that would interfere with normal performance of Government activities.
Reform of Division 2 of Part VII
53.	NSW considers that reform efforts should be directed at the following objectives.
•	To 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.
•	To introduce new free exceptions for Governments to use copyright material for specified public interest purposes (see Parts 5 and 6, below).
•	To introduce a new free exception for Governments to use copyright material on websites, where the uploading of the material did not infringe copyright and the copyright owner has not expressly stated its intention to commercialise the material.
•	To amend s. 183A such that Governments will no longer be compelled to make agreements with collecting societies (but may choose to do so).
•	To repeal s. 183C. 
Governments Performing Statutory Obligations
Question 33.	How does the Copyright Act 1968 (Cth) affect Government obligations to comply with other regulatory requirements (such as disclosure laws)?
54.	Where Governments are required to make and communicate copies of External Material, the Copyright Act causes difficult legal and practical problems for Government Agencies, and in some cases directly impedes their ability to provide public access to the information. A number of State Acts require certain information to be made publicly available. 
55.	The problems for Councils are somewhat different from the problems for NSW Agencies, because the former are not entitled to rely on the Government Statutory Licence. Where they are obliged by statute to provide the public with access to, or copies of, Third Party Material, the issue for Councils is the risk of infringing copyright. For NSW Agencies in the same situation, the issue is the risk of facing unpredictable, potentially large claims for payment from collecting societies or copyright owners.
56.	Some examples of the copyright problems arising from statutory obligations in NSW are set out below. It may be assumed that there are further examples, both in State and Commonwealth legislation.
Environmental Planning and Assessment Act 1979  (“EPA Act”) 
57.	A key example concerns plans by surveyors and architects, which must be submitted to Government agencies in relation to land transactions and planning decisions. Section 79(1) of the EPA Act requires Councils to place development applications and any accompanying information on public exhibition for a period of not less than 30 days. Section 89F imposes similar requirements on the Director-General of the Department of Planning in respect of applications for State Significant Development.
58.	Division 3 of Part 5 of the EPA Act requires “determining authorities” to demand environmental impact statements (EISs) in some cases, and to provide public access to the EISs, including by providing copies to the public. Similar obligations are imposed elsewhere in the EPA. In some circumstances, copies must also be given to the Environmental Protection Authority. The EPA Act states that the purpose of providing public access to the documents is to facilitate submissions concerning the proposed activity. There is clearly a strong public interest in making such information publicly available. However, the proponent of the development proposal is not necessarily the person who owns copyright in the EIS. 
59.	In an attempt to deal with copyright issues, subs. 113(4) currently provides:
“A proponent not entitled to copyright in an environmental impact statement referred to in section 112 (1) shall be deemed to have indemnified all persons using the environmental impact statement for the purposes of this Part against any claim or action in respect of a breach of copyright in the statement.”
60.	There are similar provisions elsewhere in the EPA Act and Regulations (not listed here, as proposed amendments are currently under consideration). It is difficult to be sure of the practical effect of these provisions, and they do not appear to have been the subject of any judicial determination. In practical terms, if a NSW Agency or Council were required to pay licence fees or compensation to a copyright owner for its use of an EIS, it might have difficulty in enforcing such an indemnity against the proponent. 
 Government Information (Public Access) Act 2009 (“GIPA Act”)
61.	The GIPA Act requires Government agencies (defined to include Councils) to provide online access to “open access information” (defined in s. 18 of the GIPA Act). A wide range of material is included in the definition of “open access information”, including development applications and associated documents (Government Information (Public Access) Regulation 2009, Schedule 1, clause 3). 
Councils
62.	For Councils, the requirement to provide such documents on their websites initially created a direct conflict with the Copyright Act, since it required them to upload documents regardless of whether or not this would infringe copyright. To avoid such conflict, NSW amended the GIPA Act by insertion of subs 6(6):
“(6)  Nothing in this section or the regulations requires or permits an agency to make open access information available in any way that would constitute an infringement of copyright.” 
63.	As a result, any third party material included in a development application is not to be placed on a Council’s website, unless copyright permission has been granted. Members of the public wanting to find out about a development that may affect them cannot access the material online, and Councils may not provide copies by post, fax or email without permission from the copyright owner. The only way a member of the public could view the Third Party Material would be to go to the office of the relevant Council to inspect the plans in person. 
64.	Further, it is not clear whether a person inspecting the documents would be entitled to make copies without permission from the copyright owner. The user might be able to rely on the fair dealing exceptions in ss. 40 or 41 of the Copyright Act, but this would depend on the particular circumstances. 
65.	If a Council provided copying equipment, such as photocopiers, in the area where development applications are made available for inspection, it would risk liability for authorising infringement of copyright, if a user made copies but did not meet the requirements of the fair dealing exceptions. The Council would not be able to escape liability by use of prescribed notices (under s. 39A) unless the documents were being viewed on the premises of a public library.
66.	The requirements of the Copyright Act thus interfere significantly with the ability of Councils to perform what would otherwise be statutory obligations, imposed to promote openness and accountability of decisions affecting the public. 
Government Agencies
67.	Unlike Councils, NSW Agencies can rely on the Government Statutory Licence, and therefore would not infringe copyright by placing Third Party Material on their website as required by the GIPA Act. However, they could be placed in a difficult financial position if copyright owners (or Collecting Societies) seek remuneration for all such activities. 
68.	The problems have been highlighted in the long-running matter of CAL v NSW, concerning remuneration for online distribution of surveyors’ plans by NSW, in compliance with land titles, planning and other legislative requirements. A detailed explanation of the web of statutory obligations under which copies were made and communicated was set out in CAL v NSW FCA at [ 9] to [119].
69.	Legal action was commenced by CAL in 2003 and following determination of legal issues by the Federal and High Courts, a hearing took place in the Copyright Tribunal in October 2012, largely to determine the equitable remuneration to be paid. At the time of writing no decision has been handed down. The case highlights some of the serious problems with the statutory licence, in particular the costs and administrative burden that can be imposed on a Government agency carrying out its statutory obligations to provide information in the public interest.
Reform
70.	The introduction of new exceptions for certain uses of third party material in the public interest, outlined in response to Question 43 below, would largely resolve the problems outlined in this section.
Material on Public Registers
Question 34.	Should there be an exception in the Copyright Act 1968 (Cth) to allow certain public uses of copyright material deposited or registered in accordance with statutory obligations under Commonwealth or state law, outside the operation of the statutory licence in s 183?
71.	NSW would support the introduction of an exception of this nature, for the reasons set out below in relation to Question 44.
Statutory Licences in the Digital Environment
Question 40.	What opportunities does the digital economy present for improving the operation of statutory licensing systems and access to content?
72.	Digital technology is making it more practicable in some areas for copyright users to deal directly with publishers and copyright owners. This removes part of the original justification for the powers given to copyright collecting societies. At the same time, the practical difficulties around administration of the statutory licences, in particular sampling surveys of Government use of copyright works, make it likely that the costs of administering the scheme are disproportionate to the amount of remuneration properly payable.  
73.	An important way to improve the operation of the statutory licensing systems would therefore be to make the s. 183A procedure voluntary. Governments should be entitled to make rational decisions concerning their use of Third Party Material and their disbursement of public funds, and should be entitled to rely on direct agreements with publishers and copyright owners rather than making agreements with collecting societies, where appropriate.
Question 41.	How can the Copyright Act 1968 (Cth) be amended to make the statutory licensing schemes operate more effectively in the digital environment—to better facilitate access to copyright material and to give rights holders fair remuneration?
74.	NSW considers that the minimum change required is to make the s. 183A process voluntary, as noted above. Further proposals are outlined elsewhere in this submission 
Question 42.	Should the Copyright Act 1968 (Cth) be amended to provide for any new statutory licensing schemes, and if so, how?
75.	NSW does not consider it necessary to introduce any new statutory licensing scheme.

Question 43.	Should any of the statutory licensing schemes be simplified or consolidated, perhaps in light of media convergence, and if so, how? Are any of the statutory licensing schemes no longer necessary because, for example, new technology enables rights holders to contract directly with users?
76.	It would appear to be logical for the copyright collecting societies that administer the Government Statutory Licence to be declared in respect of communication as well as for copying. However, if such a change were made, the legislation should make clear that no additional payment should be required for the communication.
77.	 At present, Governments are legally obliged to notify and compensate copyright owners in respect of communications, although the copying is covered by remuneration agreements. This prevents Governments from acting in ways that would be efficient and sensible and would not cause detriment to copyright owners. 
78.	By way of illustration, a librarian in a Government agency copies articles from printed journals onto CD ROMs to give to clients to read. Under s 183A, this is covered by the agreement between NSW and CAL. For efficiency, the librarian wants to stop making and handing out copies on CD ROM, and instead to allow clients to access the articles by logging into a secure online portal, from which they can read on screen or download a copy. Copies made by the clients would be fair dealings for purposes of research or study. 
79.	The librarian cannot take the more efficient option, although it would not result in any additional copies being made, because in practice it would be impossible to notify all copyright owners and negotiate terms with them for the communication of their material. This is despite the fact that a cogent argument could be made that in such a situation, where equitable remuneration has been paid for the copies, the terms for communication alone should be nil.
The discussion under Q 40, above, is also relevant to this question.
Question 44. 	Should any uses of copyright material now covered by a statutory
licence instead be covered by a free-use exception?
80.	In CAL v NSW HCA the High Court distinguished between the various uses of surveyors’ plans by NSW as follows:
“[46]	… On the one hand, the State uses the plans in direct response to lodgement of the survey plans by an applicant to effect, if appropriate, registration, and to issue title. This includes making a working copy of the plans. These uses are directly connected with private contracts for reward between surveyors and their clients for the preparation of plans for the specific purposes of lodgement, registration and the issue of title. On the other hand, there are uses of survey plans by the State which flow from registration and which involve copying the plans for public purposes or communicating them to the public via a digital system.” 
81.	The High Court noted that CAL sought remuneration only in respect of NSW’s post-registration uses of the plans, and proceeded on the basis that only those uses were remunerable. The High Court went on to examine closely the policy and legislative background to the Government Statutory Licence:
“52.	First, Art 7 of the Brussels Act, provided that the term of copyright protection shall be for the life of the author and 50 years after the date of the author's death. That raised the prospect that compulsory licensing under s 3 of the 1911 Act could continue long after any real economic interests in preventing copying had dissipated. For that reason, and following the Report of the Copyright Committee in the United Kingdom (the "Gregory Committee") before it, the Spicer Committee favoured removing general compulsory licensing provisions as they stood in the 1911 Act and as they applied in Australia, as a precondition for ratifying the Brussels Act. 
53.	Secondly, the specific abolition of Crown immunity for copyright infringement in the United Kingdom inevitably raised the question in Australia of following suit and simultaneously establishing a possible basis upon which some or all Crown use of copyright material might occur without the risk of infringement. “(Footnotes omitted).
82.	The High Court noted that in this context the Spicer Committee, by majority, favoured a broad Government Statutory Licence, to ensure Governments could use Copyright Material as needed, but also, “with an echo of s 51(xxxi) of the Constitution”, to ensure copyright owners were remunerated. (Section 51(xxxi) of the Constitution, of course, concerns the acquisition of property on just terms.) The Court went on:
“58.	Four relevant observations can be made about the Spicer Committee's recommendation. First, no overt consideration was given to distinguishing Crown use which might be subject to equitable remuneration and Crown use which might be subject to fair dealing provisions or a free use exception. Secondly, the public policy concept of "user pays" which is now familiar was not in contemplation. Thirdly, the Spicer Committee knew of the Crown use provisions recommended by the Gregory Committee but the majority of its members eschewed following these somewhat narrow recommendations. Fourthly, the Spicer Committee was conscious of, and considered, the role of collecting societies under subsisting statutory licence schemes.
59.	… no distinctions are made in s 183(1) between Government uses obliged by statute and/or Government uses which may be "vital to the public interest" on the one hand, and Government uses which reflect considerations more closely resembling commercial uses, on the other. 
60.	Whilst it is not difficult to understand a preference for a policy framed with an eye to such distinctions, no such policy is evinced in the clear and express terms of s 183(1).“ (Footnotes omitted).
83.	The wording of this passage seems implicitly to support a review of the Government Statutory Licence, and in particular the policy underlying its terms.
Context and Comparisons
84.	In reconsidering the statutory licence scheme now, it is worth identifying features of the current legislative and policy context.
85.	As noted earlier, digital technology and related changes in the information and publishing industries have made it easier for copyright users to negotiate directly with publishers for licences to use copyright works. At the same time, the changes have reduced reliance on print Copyright Material and increased the difficulty of measuring the volume of copying of Third Party Materials. All of these factors suggest that the need for compulsory intervention of copyright collecting societies has diminished, at least in relation to copyright works.
86.	The High Court’s reference to the “user pays” concept, above, reminds us that legislation and policies now routinely impose schedules of payments and cost recovery on clients of Government services, in forms more or less like the dealings with surveyors’ plans outlined in CAL v NSW HCA. (Of course, at the time of the Spicer Committee, nobody would have described a person interacting with a Government authority as a “client”.)
87.	The UK provisions based on the Gregory report have since been comprehensively reviewed and amended. The Copyright, Designs and Patents Act 1988 (UK), in a division headed “Public Administration”, sets out free exceptions to infringement for:
•	Parliamentary and judicial proceedings (s45);
•	Royal Commissions and statutory inquiries (s46);
•	Material open to public inspection or on official register (s47);
•	Material communicated to the Crown in the course of public business (s48); 
•	Public records (s49); and
•	Acts done under statutory authority (s50).
88.	The UK provisions appear to establish the policy distinction indicated by the High Court in CAL v NSW. 
Reform
89.	NSW would support amendment of the Copyright Act in similar terms to sections 45-50 of the UK Copyright, Designs and Patents Act 1988 (noting that the Copyright Act already contains provisions for Parliament and judicial proceedings, largely covering the same ground as sections 45-46 of the UK Act ). 
Fair Dealing Exceptions
Question 45.	The Copyright Act 1968 (Cth) provides fair dealing exceptions for
the purposes of:
(a) research or study;
(b) criticism or review;
(c) parody or satire;
(d) reporting news; and
(e) a legal practitioner, registered patent attorney or registered trade marks attorney
giving professional advice.
What problems, if any, are there with any of these fair dealing exceptions in the digital
environment?
90.	The major difficulty with the fair dealing provisions is that they are largely inapplicable to digital material acquired under licence, as described above in relation to Question 19.
91.	Even within the scope of material to which they apply, there are many activities that might in principle be considered fair, but which are not covered because of the narrow range of purposes. For example, the exception relating to fair dealing for purposes of professional advice may not cover services such as preparing and executing agreements, mediation, arbitration or Alternative Dispute Resolution, or preparation of patent or trademark applications. 
Question 46.	How could the fair dealing exceptions be usefully simplified?
92.	See below, Question 51.
Other Free-Use Exceptions
 Question 49.	Should any specific exceptions be removed from the Copyright Act 1968 (Cth)?
93.	NSW does not consider there is a need for any specific exceptions to be removed from the Copyright Act.
Question 50.	Should any other specific exceptions be introduced to the Copyright Act 1968 (Cth)?
94.	NSW supports introduction of some new specific free exceptions, as discussed above in relation to Question 44.

 Question 51.	How can the free-use exceptions in the Copyright Act 1968 (Cth) be simplified and better structured?
95.	The exceptions should be grouped more logically within the Copyright Act. At present, someone trying to work out whether they can rely on an exception would have to be aware of the definitions in s. 10 and the rest of Part II, the distinction between “works” and “other subject matter”, the range of exceptions and statutory licences (and judicial decisions on their interpretation), and the administrative requirements for some exceptions that are set out in Part X but not cross-referenced in the terms of the exceptions. Anyone unfamiliar with the Copyright Act, even if they had legal training, would find it difficult to be sure they had met all the necessary criteria. 
96.	At a minimum, the exceptions relating to works and other subject matter should be placed together, and any administrative requirements should be included (or at least cross-referenced) in the wording of the exceptions.
Fair Use
Question 52.	Should the Copyright Act 1968 (Cth) be amended to include a broad, flexible exception? If so, how should this exception be framed? For example, should such an exception be based on ‘fairness’, ‘reasonableness’ or something else?
97.	At this stage NSW does not express a view on this issue. However, NSW considers it would be beneficial for the ALRC to examine this issue closely and report on whether there are viable models for such an exception.
Question 53. Should such a new exception replace all or some existing exceptions or should it be in addition to existing exceptions?
98.	In line with the comments on “Guiding Principles” above at Question 2, NSW considers that any such exception should not be in addition to existing exceptions, as this would add further complexity to a system that is already almost unworkable. If a “broad, flexible exception” were introduced, it should replace some existing provisions. 
Contracting Out
 Question 55.	Should the Copyright Act 1968 (Cth) be amended to prevent contracting out of copyright exceptions, and if so, which exceptions?
99.	There are difficulties in legislating against agreements that seek to limit the effect of exceptions in the Copyright Act, not least in finding a way to make such legislation effective (for example, in relation to agreements that are stated to be governed by the laws of a different jurisdiction). In this regard, it would be worthwhile to investigate the history and practical application of the similar provision in s. 47H of the Copyright Act.
100.	The apparent intention of such legislation would be to create a form of positive right to use copyright material, perhaps as a way of addressing the problems outlined in relation to Question 19, above. NSW expresses no views on the issue at present, but considers there is benefit in considering whether such an aim is appropriate, and if so, by what means it could be effectively achieved.