Copyright concerns

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Screen legend John Kani speaking at a Copyright Amendment Bill event hosted by Adams & Adams

SCREEN AFRICA EXCLUSIVE:

The Copyright Amendment Bill will give South African creatives rights that they don’t want, while taking away the ones they actually need, says The Coalition for Effective Copyright in South Africa. Here’s what it could mean for film and TV.

If you work in a creative industry, you’re probably at least peripherally aware of the controversial Copyright Amendment Bill (CAB). First gazetted in 2015, the original CAB, along with the associated Performers Protection Amendment Bill, was the fruit of 2011’s Copyright Review Commission, itself prompted by pleas from the music industry to overhaul the 1978 Copyright Act and legislate for enforcement of Needletime royalties. Though the commission was necessary, what came out the other side is, by all accounts, a problematic bill that confers unprecedented rights on “users” of copyrighted materials, while leaving those it purported to protect – the creators – vulnerable to exploitation.

Representing a variety of industry associations, the Coalition for Effective Copyright (CEC) has been lobbying for meaningful consultation and impact assessment on the suggested amendment, the latest version of which, stakeholders warn, remains inimical to the creative economy, not to mention contradictory of international treaties, the Constitution and, in parts, itself.

The troubling sections, for those new to the debate, include those pertaining to the introduction of unwaivable and retrospective royalties, fair use rights, sub-licensing rights, a 25-year limitation on copyright assignments of literary and musical works and the infamous section 39(B), which makes it impossible to waive the rights the bill confers. In addition, the Bill introduces sweeping powers for government to prescribe contractual terms and user tariffs. “This over-reach by government may well lead to a business environment where investors would not be comfortable to invest in new projects,” warns copyright expert Stephen Hollis, a partner at Adams & Adams law firm.

Press focus lately has been on the implications for the publishing industry, partly because the Publishers’ Association of South Africa (PASA) is, to date, the only body to have arranged for an independent economic impact assessment, undertaken by PricewaterhouseCoopers (summary: bad). But film and TV professionals stand to feel the effects as well – a fact that should concern government, given the industry’s growing economic importance. Here’s a primer:

Royalties

Sections 6A and 9A of the Bill requires that copyright owners of audiovisual works pay out royalties on profits generated from the commercialisation of such works under copyright to every performer involved, down to the last extra.

This royalty rate could apply to all television shows, films, documentaries and even commercials that were flighted in the past 50 years. The proposal to introduce this ‘world-first’ royalty right in South Africa without any public consultation or economic impact assessment, is not just irresponsible, but irrational, according to Hollis.

“Not only does this send a message to investors that government can rip up existing contracts, but it obliges production companies to pay out royalties to a horde of comers on all works that are still being commercialised,” he states.

Another major issue is that the CAB restricts all assignment of rights in literary and musical works – including screenplays and scores – to 25 years. “If a producer were to offer a local composer a buy-out on the rights to an original song for big money, the composer would be prevented from entering into the deal due to the contract override clause (Section 39B),” explains Hollis.

The Performers’ Protection Amendment Bill, the ‘sister Bill’ to the CAB, further legislates that performers in audiovisual works would, after 25 years, gain the exclusive right to commercialise their performances. Any one of these performers could hamstring further use of a work by refusing to agree to a new 25-year term.

“The likely impact of this on our fledgling film sector is that international investors would look elsewhere and local producers, creatives and the satellite economies supported by the film industry would bear the brunt,” says Hollis.

Fair Use

Probably the bill’s most notorious amendments are those which introduce what Hollis calls “arguably the broadest set of copyright infringement exceptions that the world has ever seen.” While this is great news for users of copyright-protected works, like government and digital platforms, who are thereby given new freedoms to use copyright-protected works without the need to remunerate, or obtain the permission of the authors, it’s bad news for the very vulnerable creatives that the Bill purports to protect, he warns.

The fallout for those creating content for education would be particularly devastating. “It is quite clear to us that government is trying to offset the costs of ‘Free Education for all’ that they are obliged to provide, to the detriment of local knowledge production,” says Collen Dlamini, spokesperson for the Coalition.

Government’s position is that while the new language will undoubtedly generate disputes, these will be settled in purpose-formed copyright tribunals. But the cost of such litigation in time and money – for those who can afford it – not to mention investor confidence, will be disastrous, particularly since no statutory damages are awarded under our law. As explained by Animation South Africa’s Nick Cloete, speaking on behalf of the CEC: “Ultimately, creators will be practically powerless to contest copyright infringements – especially if the infringing party enjoys access to enormous resources like technology companies.”

Sub-licensing

Also worrying is Section 23, which allows licensees to conclude sub-license agreements without permission. “Our copyright law must protect our exclusive rights,” Cloete says. “Without it, we will be unable to raise the funds to finance our projects or recoup our costs.”

A small but crucial victory gained in the bill’s latest iteration, released in March 2019, is the removal of a clause stipulating that any projects funded by the state would confer copyright onto the state. Among other things, this would have effectively prevented producers from bringing the DTI rebate to the table when financing co-productions. “It now only relates to work done under the “direction or control” of the state,” says Cloete. A more dubious revision grants the Minister the power to decide which “local organisations” will take the copyright of works made under such direction.

These muddy waters will surely leave investors wondering why our government recently ratified three international copyright treaties – the World Intellectual Property Organisation Copyright Treaty (WCT); the WIPO Performances and Phonograms Treaty (WPPT); and the Beijing Treaty (all signed in 2018) – only to flout their conventions, Cloete points out. “Despite the fact that international treaties supersede domestic law, [the uncertainty] will discourage collaboration with South Africa,” he says.

What happens next?

After sailing through the Parliamentary approval process in record time, the CAB is now before the President for his assent. Several question marks around constitutionality should concern him, according to Hollis, not least the impermissible delegations of executive legislative authority to the Minister. Furthermore, the open-ended list of copyright exceptions could amount to an unjustified and arbitrary expropriation of (intellectual) property rights, he points out.

But, as you may have anticipated, therein lies a catch. As and when the long-augured changes to Section 25 of the bill of rights, allowing for expropriation of property without compensation, are finally banged out in parliament, they are likely to affect intellectual property as well as land.

Perhaps it won’t come to that. “Creative professionals can only hope the President appreciates the implications and sends the bill back for redrafting,” says Cloete.

The DTI could not be reached for comment.