Copyright Amendment Bill - more questions than answers

The Copyright Amendment Bill, published on 27 July 2015, has been lauded by some stakeholders as being progressive, whilst others view it as absurd and abysmal.

The Bill seeks to modernise the Copyright Act, 1978 to bring it in line with technological advances, but the formulation of the Bill has left more questions than answers. The purpose of this write-up is to provide an overview of some of the radical changes proposed.

Craft works and phonograms

The Bill has introduced a new class of works eligible for copyright, namely “craft works” and “phonograms”. The anomaly is that both works are already catered for in the Copyright Act. Craft works is covered under works of craftsmanship and phonograms are covered under the current definition of sound recordings.

Resale royalty right

The Bill introduces a right for creators of artistic works to claim a 5% royalty on the commercial resale of their work. This is available if the creator is a citizen or resident of South Africa, the resale occurs in South Africa, and the term of the resale right has not expired. This right cannot be waived or transferred. Whilst this is a commendable amendment, one cannot help but wonder how it is going to be implemented in practice.

Right to claim royalties despite transfer of copyright

The Bill provides that despite the transfer of copyright the owner, creator or author retains the right to claim a royalty when the work of copyright is used. Of all of the amendments which are sought to be introduced by the Bill, this is the most troubling. It is not clear how and why the creator, owner or author of copyright could, or should, be entitled to royalties after they have divested themselves of the copyright.

Grey goods

The Bill proposes that parallel importation of trade-marked goods will be permitted. Brand owners will therefore no longer be able to utilise the Copyright Act to restrict parallel imports.

Local content

The Bill requires the broadcasting industry to develop local content by, amongst others things, broadcasting 80% of local content on public channels and 60% of local content on private channels. What is more, the Bill seeks to criminalise the failure to meet the local content criteria. This, in our view, is completely unworkable and absurd.

New offences The Bill proposes a number of new criminal offences that could result in up to 10 years’ imprisonment and/or a fine not exceeding R50000.00 on conviction. These include:
 

• Collecting royalties without being accredited as a collecting society.
• Omitting to pay the author or creator of copyright a royalty.
• Unreasonably refusing to grant permission for the use of copyright work for educational and judicial proceedings.
• Failing to pay the resale royalty.
• Failing, as a broadcasting institution, to adhere to the local content quotas set out in the Bill.

Intellectual property Tribunal

The Bill proposes the establishment of an Intellectual Property Tribunal which will replace the Copyright Tribunal. It contains extensive provisions on the composition of the Tribunal and its powers. The persons who will be appointed to the Tribunal will include persons holding qualifications in economics, commerce or public affairs.

Presumption of guilt

The Bill seeks to make directors, company secretaries and similar office bearers liable and guilty if contraventions of copyright are committed by a juristic person, unless they are able to demonstrate that the contraventions were committed without their knowledge, or that they exercised due diligence to prevent the commission of such offences.

State-owned copyright

the Bill introduces new instances where copyright will vest in the state:
 

• where the author or creator of a work is unknown or cannot be located;
• where the copyright owner is dead. This, by implication, means that when the owner or creator of copyright in a work dies, the copyright will automatically transfer to the state. This is completely draconian and without cause. It is difficult to comprehend why ownership of copyright should revert to the state upon the death of the owner.
• where the copyright is created by state funds. There is no distinction between instances where the state funding is partial or whole.

Restrictions on assignments

the right to assign copyright has been restricted to 25 years. Therefore all assignment agreements will be valid for 25 years after which the copyright will revert to the owner or author of the copyright.

For the reasons set out above the Bill, as currently worded, has created more questions than answers. One can only hope that the grave shortcomings are ironed out before it is passed into law.