Canada last overhauled its copyright law in 2012, bringing to a conclusion more than a decade of failed bills and lobbying pressure. The public debate over the Copyright Modernization Act was often framed by disputed claims that Canada was weak on piracy, with critics arguing that updated laws were needed to crack down on copyright infringement. As the government prepares to conduct a statutorily-mandated review of the law later this year, the landscape has shifted dramatically with court cases and industry data confirming that Canada is now home to some of the toughest anti-piracy rules in the world.
My Globe and Mail column notes that the change in Canadian law is best exemplified by a ruling last week from the Federal Court of Canada involving the sale and distribution of “modchips”, which can be used to circumvent digital controls on video game consoles. Nintendo filed a lawsuit against a modchip retailer in 2016, arguing that the distribution of modchips violated the law, even without any evidence of actual copying.
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The Federal Court of Canada has issued a massive damage award in the first major Canadian digital lock copyright ruling involving circumvention of technological protection measures. The ruling, which is the first to conduct an extensive examination of the anti-circumvention rules established in 2012, adopts expansive interpretations to the digital lock protections and narrow views of the exceptions. The case confirms that Canada has tough anti-piracy laws with one of the most aggressive digital lock laws in the world and will fuel calls to re-examine the effectiveness of the anti-circumvention exceptions in the 2017 copyright review.
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The U.S. DMCA notice-and-takedown system has generated heated debate for many years with supporters arguing that the safe harbour is essential, while rights holder critics countering that the growing number of takedown notices sent to Google illustrates mounting piracy concerns. In recent months, there have been several reports that raise questions about the reliability of takedown notices. A study released last year by the University of California, Berkeley and Columbia University found that approximately 30% of notices were questionable, while TorrentFreak report this week identified tens of millions of fake DMCA takedown notices sent to Google on a website with virtually no traffic. An earlier report also raised questions about dubious takedown practices.
Yet those reports pale in comparison to data just released by Google in its submission to the Register of Copyrights as part of the review of the DMCA notice-and-takedown system. Google reports that the overwhelming majority of takedown notices sent to Google Search through its Trusted Copyright Removal Program do not involve pages that are actually in its search index. The submission states:
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As part of the contentious debate over the implementation of anti-circumvention rules in Canadian copyright law in 2012, the government tried to assure concerned stakeholders that it had established specific mechanisms within the law to create additional exceptions to the general rule against circumvention. The law includes a handful of exceptions for issues such as security or privacy protection, but there is also a process for adding new limitations to the general rule. There are two possible avenues for new limitations and exceptions. First, Section 41.21(1) allows the Governor in Council to make regulations for an exception where the law would otherwise “unduly restrict competition.” Second, Section 41.21(2)(a) identifies other circumstances to consider for new regulations for exceptions including whether the circumvention rules could adversely affect the fair dealing criteria.
In addition to those two potential regulation making models for new exceptions and limitations, Canadian law also establishes the possibility of creating a positive requirement on rights holders to unlock their locked content. It states that the Governor in Council may make regulations:
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The Trouble with the TPP series focuses today on the TPP’s effort to regulate how Internet providers and hosts address allegations of copyright infringement on their networks and sites (prior posts include Day 1: US Blocks Balancing Provisions, Day 2: Locking in Digital Locks, Day 3: Copyright Term Extension). The goals of the U.S. and Canadian government in the negotiations were clear from the outset: the U.S. wanted to export its DMCA notice-and-takedown system to the rest of the TPP, while Canada wanted to preserve its newly created notice-and-notice approach (more on the notice-and-notice system, which does a better job of striking a balance and preserving user privacy, here). In fact, Canada rushed through the notice-and-notice system without regulations (causing major problems of misleading notices) in order to argue that it should not be required to adopt the U.S. approach.
The end result is a compromise that allows Canada to maintain notice-and-notice, but no other TPP country can adopt it in order to comply with the ISP liability and notice rules. The Canadian rules can be found in Annex 18-E, which states that the standard TPP ISP rules do not apply to a country that meets the conditions of the annex “as from the date of agreement in principle of this Agreement.” Since that date is now long passed (October 4, 2015), no other TPP country can implement the notice-and-notice system to meet its TPP obligations. It should be noted that Chile, which objected to the special treatment for Canada, obtained a similar exception for its system based on the U.S. – Chile Free Trade Agreement in Annex 18-F.
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