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Digest No. 1751

Copyright (Infringing File Sharing) Amendment Bill 2010

Date of Introduction: 23 February 2010
Portfolio: Commerce
Select Committee: As at 23 March, 1st Reading not held.
Published: 23 March 2010byJohn McSoriley BA LL.B, Barrister,Legislative AnalystP: (04) 817-9626 (Ext. 9626)F: (04) 817-1250 Caution: This Digest was prepared to assist consideration of the Bill by members of Parliament. It has no official status.Although every effort has been made to ensure accuracy, it should not be taken as a complete or authoritative guide to the Bill. Other sources should be consulted to determine the subsequent official status of the Bill.

Purpose

"This Bill amends the Copyright Act 1994 (the Act) to provide new enforcement measures against the unauthorised sharing of copyright material via the Internet (infringing file sharing). It repeals section 92A of the Act (enacted by section 53 of the Copyright (New Technologies) Amendment Act 2008, but not brought into force), which would have required ISPs to adopt a policy providing for the termination of a repeat infringer's Internet account" [1]   .

Background

"File sharing involves the direct or indirect transfer of material via the Internet between 2 points. The transfer may be between users, or between a user and a place where that material is stored. Sharing of copyright works or parts of those works often occurs without the authorisation of the copyright owner, constituting an infringement.

"The Act currently provides civil enforcement measures that are considered to be ineffective in remedying infringing file sharing. For each infringement a copyright owner must seek a court order to obtain the identity of the infringer from that infringer’s Internet service provider (ISP). The cost of seeking an order and the cost of taking infringement proceedings in court is generally much higher than a possible award of damages for that particular infringement, acting as a barrier to the effective enforcement of copyright.

"While the damage sustained by a copyright owner from a single file sharing infringement is generally small, the prevalence of infringing file sharing in the current digital environment is having a negative cumulative effect on New Zealand’s music, film, and software industries. Internationally, this problem is also recognised, and other jurisdictions such as the US and UK have legislated or are legislating to provide for the effective enforcement of copyright against file sharers" [2]   .

Main Provisions

ISP definition

The Bill provides a definition of Internet Service Provider (ISP). An ISP is a person that operates a business that:

  • offers the transmission, routing, and providing of connections for digital online communications, between or among points specified by a user, of material of the user's choosing; and
  • charges its account holders for these services; and
  • is not primarily operated to cater for transient users (Part 1, Clause 7, inserting New Section 122A(1), definition of "ISP" or "Internet Service Provider").

Comment

"The definition is intended to exclude universities, libraries, and businesses that provide Internet access to their members or employees but are not in the nature of a traditional ISP such as Telecom. Only traditional ISPs are in a position to perform evidence matching and notice functions" [3]   .

Three notice procedure

The Bill provides that, at the instigation of a copyright owner, a first notice (a detection notice) is to be given by the ISP to the infringing account holder (an account holder, in relation to an ISP, means a person who has an account with the ISP). This notice informs the account holder that, inter alia, any further evidence of infringement will be logged by their ISP and explaining the consequences of such infringement occurs. The Bill also provides for second and third notices (warning notices and enforcement notices) to contain a list of alleged infringements for that account holder since the detection notice and a warning that the Copyright Tribunal (the Tribunal) may award compensation based on that list. After receiving notification from an ISP that an account holder has received three notices, copyright owners may apply to the Tribunal for a compensation of up to $15,000. Copyright owners may also make an application to a District Court for an order requiring the ISP to suspend the account holder’s Internet access for up to six months. Account holders may challenge infringement allegations by copyright owners (see below) (Part 1, Clause 7, inserting New Sections 122A-122M).

Compensation for copyright infringement by file sharing

The Bill provides for the extension of the jurisdiction of the Tribunal to make orders compensating copyright owners where copyright infringement by file sharing is repeated (Part 1, Clause 7, inserting New Section 122N into the Act)..

Sanctions for serious infringers

The Bill provides that copyright owners may seek an order from the District Court suspending a repeat infringer’s Internet account for up to six months after a third notice has been sent to the account holder (Part 1, Clause 7, inserting New Sections 122O and 122P into the Act).

ISP obligations and liability

The Bill provides that every ISP must retain, for a minimum of 40 days, information on the use of the Internet by each account holder, and must retain, for a minimum of 12 months, the following information:

  • any information about infringements that is sent by copyright owners to the ISP for the purpose of matching the infringement to an account holder;
  • copies of the infringement notices issued to an account holder;
  • any challenges received by the ISP and any responses to those challenges;
  • which infringement notices (if any) have been cancelled or have expired;
  • any orders made suspending an account holder's account.

No ISP may release the name or contact details of an account holder to a copyright owner unless authorised to do so by the account holder required to do so by the Tribunal or a court (Part 1, Clause 7, inserting new Section 122Q into the Act).

The Bill provides that an Internet service provider does not infringe the copyright in the work, or authorise A's infringement of the copyright in the work, merely because the Internet service provider knows of the infringement from information received as a result of anything done under this Bill provided that, in relation to the alleged infringement, the Internet service provider complies with all the above obligations and under any regulations made under Section 234(eb) to (eh) (Part 1, Clause 6 amending Section 92B of the Act by inserting new subsection (2A); Part 2, Clause 10, amending Section 234 of the Act by inserting new paragraphs (eb)-(eh) (regulations)).

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Except for educational purposes permitted under the Copyright Act 1994, no part of this document may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, other than by Members of Parliament in the course of their official duties, without the consent of the Parliamentary Librarian, Parliament Buildings, Wellington, New Zealand.This document may also be available through commercial online services and may be viewed and reproduced in accordance with the conditions applicable to those services.

  1. Copyright (Infringing File Sharing) Amendment Bill, 2010 No 119-1, Explanatory note, General policy statement, p. 1.   [back]
  2. Copyright (Infringing File Sharing) Amendment Bill, 2010 No 119-1, Explanatory note, General policy statement, pp. 1 and 2.   [back]
  3. Copyright (Infringing File Sharing) Amendment Bill, 2010 No 119-1, Explanatory note, General policy statement, p. 4.   [back]