Copyright (New Technologies) Amendment Bill

The Copyright (New Technologies) Amendment Bill, which National supports, is in two parts. The first part has a number of amendments to the first part of the Copyright Act, and Part 2 is concerned with amendments to Parts 6 to 11. I want to spend the short time I have in talking about technological protection measures, or “TPMs” as they are called in the industry.

Before I do that, though, I just make the comment that it is scarcely satisfactory that a Supplementary Order Paper that touches this and a number of other issues has been delivered to us to see just today. It is not easy to pick up complex legislative change and to be satisfied that what has been proposed by the draftsmen is in fact truly appropriate in the particular context of copyright law. I say that because this is not perfect legislation. I think we would all acknowledge that, and that is why I welcomed those in the Chamber who spoke about something akin to the provisions included in the Evidence Act that would require the Government to carry out a review within a specific time frame to see this legislation improved. This is piecemeal legislation. It is certainly better, but it is not as good as it might be.

If I talk about technological protection measures, the starting point is clearly clause 89. There, a number of new sections—sections 226 to 226J—are substituted. Perhaps I should start by talking about technological protection measures in a more general way. They are a means to combat the ease of unauthorised reproduction and distribution that digital technology provides. Examples of technological protection measures include the content scrambling system used by DVD manufacturers to control the types of devices and software that can access a DVD’s content, and the digital rights management systems used in software to control the copying and distribution of content files. If we look at what the law is, we see that the Act allows copyright owners to take action against people who supply or manufacture devices, means, or information specifically designed to circumvent technological protection measures. This applies only to technological protection measures that prevent copyrighted material from being copied.

The bill before us tonight will extend this right by allowing copyright owners to take action in respect of devices, means, or information, where circumvention could enable infringement of all exclusive rights, not just the right of copying. An example of that is that the bill will include infringement of the communication right that extends to webcasting. The act of circumventing the technological protection measure will not itself be prohibited, and the offence provision introduced in the bill for commercial dealing in circumvention devices, means, and information is intended as an additional deterrent for such activity. There are also new provisions to enable the actual exercise of permitted acts where technological protection measures have been applied.

It is, of course, a reality that in the online world, protected works can be copied perfectly, instantaneously, and in multiple copies. They are then disseminated around the world with the click of a key, so it is critical for copyright owners to be able to use technological protection measures to implement the terms and conditions of use that consumers have paid for, and to protect their works against such easy and unauthorised copying. The World Intellectual Property Organization treaties therefore contain a provision requiring that technological protection measures be given effective legal protection against circumvention, and it is right to say that a number of groups are concerned that the way in which the bill has been reported back from the select committee—and I will come to the impact of the Supplementary Order Papers in a moment—will mean that New Zealand will diverge from what other countries have been doing in this area. I would say that that is most undesirable. Those groups go so far as to say that if the bill is enacted as reported back by the select committee, it will not provide any meaningful protections for technological protection measures or any legal certainty regarding enforcement.

My take on what the particular concerns are, are really these. The concerned groups say, first of all, that the definition of a technological protection measure is poor. The critical thing, of course, is to protect access control. For example, if a person can gain access from a subscription, one has to be able to deny access if the person is not paying the subscription. They are also concerned about the definition of prohibited circumvention devices, and I think a minor change is needed to make the current formulation more acceptable. Then there is the very vexed and tricky question of the knowledge element for prohibited conduct. In the bill as reported back by the select committee, liability for trafficking in circumvention devices—which, as the legislation makes clear in the definition provisions, get around technological protection measures—is contingent on establishing knowledge and intention that the device will be used to infringe property rights. Those may be very difficult elements to prove.

Then there is the issue of exceptions from prohibitions, which is dealt with in new section 226D in clause 89. Those interested groups, which I think are genuine, are concerned that the regime is too permissive and would undermine the legal protection itself. So we had, just as one example, a submitter saying that the bill as amended would be inconsistent with the requirements of the World Intellectual Property Organization treaties and would make our law different from Australia’s. I think there is a concern that the industry does not want a black market in these devices and there is a case for a controlled approach like Australia’s.

I will turn briefly to the Supplementary Order Paper itself, which I have criticised because it came so late in the day. It cannot be good practice in a parliamentary democracy that we have seen in the course of an afternoon a number of amendments to this legislation. They are not textual amendments; they are actually substantive amendments across a range of fronts. I note in connection with Supplementary Order Paper 193, which is the Government’s Supplementary Order Paper, that there is clarification of the extent to which the rights of a technological protection measure issuer, under new section 226B, impinge on the exercise of a permitted act or the undertaking of encryption research. There is also clarification of new section 226E as to who may undertake encryption research.

So there we have this legislation. One is reminded of the curate’s egg—good in parts; not so good in other parts. I express the hope that when there is a change of Government in the next period, it will be a priority of the new Government that this legislation will be looked at more critically and in a more holistic way to produce a better outcome.

I am interested in the final comment made by Dr Worth. I suspect that this legislation will not last another century. It will probably need revisiting before that time, when he predicts there will be a change of Government. In the meantime I think there is much to do with the matter before the Committee.

I think we should remind ourselves that the purpose of the technological protection measures provisions is to give copyright owners a more comprehensive right relating to the protection of technological protection measures in response to technological developments and, travelling with that, the increased risk of piracy of copyright works in the digital environment. Central to this legislation is a recognition of the fundamental shift and change that have taken place in technologies. Copyright owners are increasingly using technological protection measures as a practical means to protect their copyright and, of course, to assist in the development of new business models.

The Act currently allows—and I think Dr Worth made some reference to this—copyright owners to take action against persons who supply or manufacture devices, means, or information that are specifically designed to circumvent the copy protection and that are intended to be used to make infringing copies or copyright works. The copyright owner will have the ability to take action in respect of devices, means, or information where circumvention could enable infringement of all the copyright owners’ exclusive rights, not just copying. This is cognisant of the increasing importance of the rights of communication and the necessary incentives for the provision of online and digital services.

Clause 89 inserts into the Copyright Act new section 226C, which I do not think Dr Worth visited. The section is a criminal offence provision in limited circumstances where there has been large-scale commercial dealing in circumvention devices, information, or services, and is intended to provide a necessary deterrent. Dr Worth made passing reference to new sections 226D and 226E, which enable the actual exercise of permitted acts where technological protection measures have been applied. The provisions provide a person wishing to exercise a permitted act who does not himself or herself have the ability to circumvent, with the option of seeking assistance from the copyright owner or certain trusted organisations—so-called qualified persons. A “qualified person” means a prescribed library, an archive, or an educational establishment.

There were a number of Commerce Committee amendments that I will not go into in any detail at this time. But I am sure that as we progress through our consideration of this part there will be some discussion of those amendments and I may take another call to add to that general discussion.

My call on this part will be relatively brief because Dr Worth has dealt in some detail with technological protection measures, but there are two issues that I want to raise. As we know, and both speakers have referred to it, the bill deals with technological protection measures but it limits the scope of these measures to those that protect established rights of copyright owners and, as the report of the Commerce Committee says, it specifically excludes the so-called access controls. That is an issue that we may need to revisit at some stage in the future. It is a very interesting issue.

It is perhaps necessary for the record to distinguish between the two types of technological protection measures. Technological protection measures that protect the traditional prerogatives of copyright owners are largely uncontroversial, and these are the ones we are dealing with tonight. They are measures that protect against activities that are traditionally part of the copyright—for example, reproduction, distribution, public performance, and the like. Technological protection measures that control access to a work are much more controversial. This type of technological protection measure is particularly important for musical works, for example, the enjoyment of which does not necessarily implicate the established rights of the copyright owner.

The commentary to the select committee report states: “We consider that the principal Act is not intended to protect access-control technologies that are used to price-discriminate or control the geographical distribution of works to the detriment of users in New Zealand.” However, it is interesting to note that the copyright laws of the United States and also, I think, of Australia, include provision for access-control technological protection measures in addition to the traditional ones I have referred to tonight. It is possible that this will be an issue that we have to revisit at some stage in the future if necessary to bring our law into line with that of Australia and the United States. That is the first point I wanted to make.

The second point is a matter that picks up on what Dr Worth said about eleventh-hour amendments. I said that I was grateful to the Minister for providing this material to me in the morning, but there is an issue that I wonder whether she will need to talk to her officials about because I have been studying it closely for the last couple of minutes and I am just a little bit worried about it. The bill adopts a fairly standard definition of technological protection measures. In the United States in recent times, as I understand it, there has been divergent case law as to whether, if one misuses another’s password, that could amount to circumvention of a technological protection measure. As I understand it, password protection is now a standard mechanism accompanying the marketing of copyright-protected works. I have taken a good look at the definition of technological protection measure circumvention device. It means a device or means that is primarily designed for the purpose of enabling or facilitating the circumvention of a technological protection measure, and then of course there is the Minister’s amendment. I will read it as if the Minister’s amendment has been included “and has only limited commercially significant application except for its use in circumventing a technological protection measure”.

Now, the officials may know better than me, but from just looking at the words of those provisions I do not know that misusing someone else’s password will be caught by that form of words. It may be necessary to try to clarify this point tonight. I am sorry that this matter has come to my attention only this afternoon, but I have a problem with it and I wonder whether it should be addressed, given that password protection is a standard mechanism accompanying the marketing of copyright-protected work. Perhaps we need to try to deal with that issue tonight.

I also want to comment on the technological protection measures, just to recap the three main points surrounding that. The purpose was to extend the current technological protection measure provisions so that technological protection measures protect all exclusive rights under copyright—not just copying—and also provide an offence for commercial dealing in technological protection measures, circumvention devices, means, and information, and contain provisions to enable users to seek assistance from trusted institutions such as libraries and educational establishments, and to break technological protection measures in order to exercise permitted acts under Part 3 of the Act.

The key changes made to the technological protection measures at the Commerce Committee were to clarify that technological protection measures are designed for purposes other than the protection of copyright, for example, zoning on DVDs to enable market segmentation is not protected, and the provisions to enable users to seek assistance from trusted institutions were simplified so that a user no longer needs to apply to a copyright owner before he or she seeks assistance from a trusted institution. There is also a new ability for the class of trusted institutions to be extended by Order in Council. These amendments were made on the recommendation of the specialist advisers to the Commerce Committee.

Some of the concerns raised by the public were that that provision did not protect technological protection measures that controlled unauthorised access, that the provisions are out of step internationally, and that the knowledge requirement for the offence of commercial dealing in technological protection measure devices means it would be very difficult for a prosecution to be maintained. Those concerns were not directly linked to the select committee amendments. However, the previous concerns raised similar issues. Although some other countries provide broader protections for technological protection measures that restrict access, these provisions have generally been put in place in order to meet obligations under free-trade agreements with the US, as with Australia. The knowledge requirement in the offence provision is an important safeguard, given the level of penalty that a breach of the provision could give rise to. I thought it was important just to revisit that issue and to raise it this evening. Kia ora.

I will take a relatively short call on Part 2 of the Copyright (New Technologies) Amendment Bill, but first I will just follow up on what Dr Worth was saying. He was saying that should there be a change of Government—which of course there will be—we will have to revisit this legislation. Then the Hon Mark Burton said that the legislation would be revisited but gave a different set of reasons. I think that both had some elements of truth in what they were saying, in that the pace of technological change will really mean that copyright legislation—anything pertaining to the digital world—will have to be revisited on a pretty regular basis. Within a few short years a lot of this stuff—if it is not obsolete—certainly will not be up to date with current technological developments.

In the debate on Part 1 we talked about the issue of content shifting with regard to music. But the reality is that those issues now equally pertain to content shifting with regard to video. If one looks out there, one sees that there is a whole generation of people who are now watching their television very much along the lines of the iPod model. They are using programs such as LimeWire to download the latest television shows from America, to watch programmes such as Desperate Housewives, or Lost, and watch them on demand, when they want to watch them, and where they want to watch them. So the old model of broadcasting really is in its last days. It will not be long—it will be a matter of a couple of short years—before we are going to have Internet television widespread throughout New Zealand. What we need now is a broadband infrastructure that allows that to be provided. This bill, really, should have given an opportunity to future-proof some of the legislation in anticipation of some of the technological changes that we will see. So I would have to say, unfortunately, that a lot of this stuff is almost on the verge of becoming obsolete now.

Speaking about another thing, I was at a public meeting last night in my electorate, in Glenfield, and we were discussing the council district annual plan. There was a guy there with a hand-held video camera who was videoing the whole procedures. Fortunately I was not speaking, because when people nowadays have a video on one, one wonders what is coming next. But I can tell members that if that video went on YouTube last night I do not think there would have been too many hits on it—it was pretty dry stuff. It was talking about waste sewerage systems through North Shore City. I went up to this guy and said to him: “What are you doing?”. He said: “Look, I can’t speak now; I’m actually making a movie.” I do not know how this stuff will appear, but I suspect this gentleman was probably making some sort of documentary on local government. It will have been made with a hand-held camera, and I would say that it will be on YouTube pretty soon. When we look at clause 77, “New section 172 substituted”, we see that it talks about infringement by use of illicit recording made without a performer’s consent. This is obviously covering commercial performance, but the point I would make—and I think we are all probably going to face it in this election campaign—is that we are in an environment now where whatever we do or say is on video, potentially. It could be on YouTube, and basically there could be a need for legislation in the future to give guidance in some of these circumstances. The general point is that a lot of this stuff could be obsolete in a very short time, or at the very least we would need further legislation.

Another point is that we have been talking about technological protection measures. That is a measure that obviously needs to be in the bill. Talking about content shifting from musical formats, it will be interesting to see whether manufacturers start building technological protection measures into commercially sold CDs, and then what the implications will be for people who try to override those and shift content from their CD player on to their iPod. I am saying that there will constantly be evolving technological developments that will throw up new situations that, I think, will need to be addressed by this Parliament. It is certainly the area of digital technology and copyright law that I believe will keep this Parliament, the officials, and certainly anyone involved in those industries, intellectually and practically engaged for quite some time. So there may well have been a reason for these Supplementary Order Papers arriving early this morning, but it is a shame that they did. I think we will see a lot more change in this area of law over the years to come.

Again, I thank members for their mainly constructive views. Some of us are prepared to say that when this Labour-led Government is re-elected, I am sure, with the excellent support of parties that we have, we will happily go on with the evolutionary process. I am sure that the National Party in Opposition will find something constructive to do, but we look forward to that process. I genuinely thank members for their constructive approach on the Copyright (New Technologies) Amendment Bill.

It is always regretful that at times, particularly because of the technical nature of this sort of legislation, Supplementary Order Papers cannot be produced too far ahead of time. We obviously have to go through a process of Cabinet considering any change to earlier agreed policy. Then we have the select committee process—and the Commerce Committee expressed some frustration at the technical nature of this legislation. I would argue that it is technical legislation because it is about a range of interests that sometimes compete. I agree with Dr Jonathan Coleman that we are attempting in this legislation to make it as technology neutral as possible so that we do not have to go on changing legislation because of assumptions that have been made in earlier times—like the use of film work or authors of work. We have in this legislation introduced the new idea of a communication work rather than a book, an article, a film, or whatever the earlier legislation may have covered.

I remember when the House considered the major amendment to the Copyright Act in 1994 and 1995 up to the implementation of the Agreement on Trade-Related Aspects of Intellectual Property Rights, which set up the World Trade Organization. We spent endless hours debating terms like “mixed media works”, and if we could have all of those hours back, I think many of us would be very grateful. We now realise that we cannot guess how technology will change in the future, or, indeed, how people will use technology in the future. To the greatest extent we can, we are trying to streamline and teflon-coat this legislation so that no matter what the nature of the content or the process is, the copyright protection will override that.

I thank Dr Richard Worth for his examination of the area of technological protection measures, as I do the Hon Mark Burton, whose contribution was very useful. I make the point that there are already technical protection measures on things like commercial CDs and to a large extent the market has seen that off. People did not buy the CDs that had anti-copy protection, partly because many people found it very difficult to play them in mobile reproduction—I am trying not to use particular names—in things like iPods and MP3s and sometimes in people’s cars. Those CDs would not play; they would skip. People would go back to the retailer and complain that the CDs did not work. I think that has seen off the attempt to put anti-copying technological protection measures on commercial CDs of music. But that does not mean that people will not go on trying to adapt, evolve, and invent new ones.

One of the points that the Commerce Committee considered around the whole area of technological protection measures was access—and Dr Richard Worth’s comments are pertinent in this area, where he was saying that we were perhaps not exactly following what other countries were doing. Well, part of the reason is that we think there is an important issue that copyright protection, overall, which in New Zealand covers from the death of the author plus 50 years—in Australia it is from the death of the author plus 70 years—be made infinite by the use of a technological protection measure. We are very concerned that access can be given in a reasonable way. We do not want to have technological processes that mean New Zealanders in the future may not be able to access things that are important to them. We have the exceptions that include areas of research, and the open-source community makes it very clear that its concern is the ability to get into the back-end—particularly of software—so that they can see how it is done but also so that they can make better protections against viruses, worms, and other attacks on our systems or our information.

There is a need for research and a need for protection of devices and systems, but there is also the exception provided where there is good reason. For example, there was an issue that was brought to me by a teacher of the blind who works through the Royal New Zealand Foundation of the Blind. Her point was that every other child in New Zealand was able to get the last Harry Potter book at 1 minute past 11 on, I think, 26 July last year but if one happened to be blind, one had to wait for some months for either a Braille copy, or an audio or video copy. The teacher and the children involved were perfectly prepared to pay for a copy as everybody else did when buying a copy of that very popular book. In New Zealand we have access to a substantial range of works for people who are sight-impaired, and, of course, with the older generation living longer, we have more and more older New Zealanders who never learnt Braille but who are becoming sight-impaired. It is really important, particularly for things like newspapers, magazines, and that sort of work, as well as published books, that we have the widest access. I look forward to the day when we will have an international agreement where people with sight disabilities can access that. But in the meantime I think it is perfectly reasonable that, having made an attempt to acquire a copy of a textbook, another book, a magazine, or a newspaper, people wanting to access it in a digital form that can be used by people with disabilities can do so.

We have been consulting very broadly with the Royal New Zealand Foundation of the Blind to look at all of those issues, and I want to pay a particular compliment to Mary Schnackenberg who is policy and research person at the foundation. She has been urging us on in this and the ministry is now taking a very proactive approach at international level, particularly the World Intellectual Property Organization. For example, at a recently held Standing Committee session of that organisation we made an intervention to support future work and further work on the issue of importing accessible copies from other countries. I would urge anyone who is talking with representatives of other countries to urge this work on. I think it is of huge benefit to New Zealanders with sight disabilities and also more broadly. In the meantime, the ability to legally circumvent technological protection measures may be necessary for people to get access to a digital copy, so that that can then be translated into Braille or other forms available for them.

I thank members for this. I think this debate has been very useful. The issues that Chris Finlayson raised that he was concerned about are being discussed by the officials and we will get a reply before this part finishes. Thank you.

I realise that the evening is moving on, but I want to briefly compliment the Minister Judith Tizard on a very good and appropriate contribution. I pick up the point Dr Coleman made about the notion of Internet television, which presumably comes via an Internet service provider. I note that Supplementary Order Paper 193 “clarifies that an Internet service provider who knows or has reason to believe that material posted on the ISP’s website infringes copyright is liable if the ISP does not delete or prevent access to the material as soon as possible after becoming aware of it. A factor in determining whether an Internet service provider knows or has reason to believe that material infringes copyright is whether the Internet service provider has received an infringement notice …”, etc., etc.

Obviously, what speakers have alluded to, and I certainly do, is that any legislation will try to accurately forecast the current situation and what is ahead of us. I think of the days, dare I say it, when vinyl records were replaced by CDs. We now have DVDs. I have one little complaint in terms of DVD manufacturers, and that concerns the zones they have. The other day my mother bought a DVD in good faith to send to her sister in Britain—I think it was about Warbirds over Wānaka. She could not play the DVD, because it had a different zone. So we get into this whole issue. How is that different from buying a book, providing one buys a book in a bookshop in New Zealand, whereby we are paying, as part of that retail price, the price of the copyright, the intellectual property right of that book, and then we send it as a gift? In the end I guess manufacturers will determine that. Now there are “world mode” DVD players. The issue, frankly, is that we do not really have the right to go down to the market and buy a pirated DVD that has been copied in a backyard shed, then post it over and we all go home, in terms of trade and in terms of selling that intellectual property right—that creativity, if you like.

In terms of Internet television, under this Government we have seen the fantastic development of TV6 and TV7, which have been included on the FreeView platform. They are two extensions that have been rolled out that are growing public television. In addition to Television One, TV2, TV6, and TV7, if I could just talk about the Television New Zealand stable, increasingly important in terms of its product is, of course, that Internet connection, whereby one goes on to the TVNZ website. There are a lot of—what are those downloadable things—

💬 Hon Judith Tizard: Podcasts.

That is it; thank you—what a good Minister! Through a podcast we can watch a particular programme, such as Agenda—I saw the wonderful Helen Clark on that programme the other day—or we can go on the Hillary Clinton website overseas. The issue around that is that this legislation is part of the international context of intellectual property rights in terms of international agreements to make sure that the intellectual property right of each of those broadcasts is protected.

What that means, for example, is that Television New Zealand, through, say, an Internet service provider, cannot just pirate some programme from overseas unless it has actually purchased the rights to that programme. The Internet is now another form of broadcast of Television New Zealand, to use that as an example.

I strongly commend what I think is a very good and appropriate Supplementary Order Paper, and I thank the officials most sincerely for their work. This is a constantly moving target, and we do our best at this point. It is not to say that, 2 or 3 years out, we are not going to have to revisit this bill. That is the nature of the area we are working in at the moment.

I had foreshadowed that the officials were working on a response to Christopher Finlayson’s very useful question about whether simple passwords could be considered a technological protection measure. I think that in most cases they are considered to be an access control.

The definition of a “technological protection measure” focuses on conduct that is linked to the infringement of copyright and it includes access controls that might be linked to that infringement. So the general issue is whether the intent is to infringe copyright. Of course, in some cases, the theft of a password is that, but there is also the issue that most of us have passwords that are so blindingly obvious, they do not provide a particularly high level of security. I know that the information technology services at Parliament recently required people in the Parliamentary Service and Ministerial Services to have much more complex passwords. I have to say that with my BlackBerry it takes me longer to get the jolly thing open than it does to read the message, quite often.

The whole issue around technological protection measures and whether access control is a technological protection measure is clarified by Supplementary Order Paper 193, which states that technological protection measures will not be protected if they control only non-infringing activities through an application of an access control. I hope that reassures Chris Finlayson. I acknowledge the issue he raises, which occurred to him only this evening, as he received the Supplementary Order Paper only this morning. I assure the Committee that I was urging the earliest preparation of that Supplementary Order Paper so that it could be given proper consideration.

We are also in the process of developing another copyright bill, which will be particularly focused on the commissioning rule. In that bill we will have the opportunity to address some of these issues, if there is a problem. I thank the honourable member for raising that issue. I hope that he is reassured, because I am.

The question was put that the amendments set out on Supplementary Order Paper 154 in the name of Gordon Copeland to Part 2 be agreed to.

Amendments not agreed to.

The question was put that the amendments set out on Supplementary Order Paper 193 in the name of the Hon Judith Tizard to Part 2 be agreed to.

Amendments agreed to.

Part 2 as amended agreed to.

Clauses 1, 2, and 2A