I appeared earlier this week before the House of Commons Standing Committee on Finance as part of its review of Bill C-86, the Budget Implementation Act. The bill features extensive intellectual property provisions arising out of the IP strategy referenced in Budget 2018. My comments were consistent with previous posts on the changes to notice-and-notice, patents, and the Copyright Board. My opening remarks are posted below.
Appearance before the House of Commons Standing Committee on Finance, November 7, 2018
Good evening. My name is Michael Geist. I am a law professor at the University of Ottawa, where I hold the Canada Research Chair in Internet and E-commerce Law, and I am a member of the Centre for Law, Technology, and Society. I appear in a personal capacity representing only my own views.
I am pleased to have the opportunity to discuss the intellectual property provisions found in Bill C-86. As you know, Budget 2018 prioritized a national IP strategy. While aspects of that strategy involve investment in issues such as IP education, there were several legal and policy commitments that required legislative reform.
Many aspects of Bill C-86’s IP provisions are both long overdue and welcome. Since abuse of intellectual property rights may inhibit companies from innovating or discourage Canadians from taking advantage of the digital market, crafting rules that address misuse can be as important as providing effective IP protection. There are several examples of how Bill C-86 addresses IP misuse.
For example, the misuse of Canada’s copyright notice-and-notice system, which was formalized in 2012 to allow rights holders to forward allegations of online copyright infringement to Internet users through their Internet service provider, has been an ongoing source of concern. Bill C-86 amends the Copyright Act to ensure settlement demands are excluded from the notice-and-notice process, thereby restoring the original intent of the system.
Patent changes to address patent trolling provide another important reform. Bill C-86 seeks to combat patent trolls by creating new minimum requirements for patent demand letters, which should discourage the sending of deceptive letters. The rules also include the right for a recipient to pursue damages or injunctions at the federal court.
The bill also includes provisions that expand prior use rights, address standard essential patents, and create safeguards for research with a rule stating that “an act committed for the purpose of experimentation relating to the subject-matter of a patent is not an infringement of the patent.” In doing so, the bill restores a better balance to support innovation within the patent system.
Bill C-86 also includes notable reforms to the Copyright Board, including an important reference to considering the public interest in the decision making process. It rightly does not include an expansion of statutory damages among the extensive reforms to the Copyright Board. Arguments in favour of expansion were unconvincing and would have usurped the role of the Industry committee that is currently engaged in a copyright review. The issue will still be hotly debated as part of the review, but the committee is the appropriate place for discussion of statutory damages, not within a package of administrative and governance reforms to the board.
While these represent some of the positive in the bill, there is still room for improvement. I’d like to offer three recommendations.
First, the implementation of some of the reforms – such as the patent reforms I’ve just described – are likely delayed for years since they are structured to require regulations to define issues such as the requirements in patent demand letters. Officials have indicated they know what they want included. Long delays undermine the likely success of the government’s IP policy. Bill C-86 should include the requirements and the issue should not be left to the regulation-making process.
Second, the notice-and-notice copyright fix is good, but we can still do better. There should be penalties for sending abusive notices and common standards established to make it easier for Internet providers to identify compliant notices.
Third, Budget 2018 includes several references to artificial intelligence, one of the Canada’s most important innovative sectors. Yet despite the prioritization of both AI and the IP strategy, it leaves a major AI copyright barrier untouched. Several of the world’s leading AI companies – including Canada’s Element AI, Microsoft, and members of the Business Software Alliance – have pointed to the need for fair dealing exception for text and data mining or informational analysis. Without such an exception, Canada will trail badly behind competitor jurisdictions such as the U.S., Europe, and Japan, which have addressed this issue by allowing for data mining without the risk of copyright liability. Canada cannot wait many years to address this commercialization barrier. Given the budget’s inclusion of both AI and IP, Bill C-86 would be an obvious place to fix the problem.
I look forward to your questions.