In the aftermath of the CRTC's hearing on a consumer wireless code and
the government's announcement of its plan for future spectrum auctions, a
debate has raged over the competitiveness and health of the Canadian
wireless market. Scotia Capital released a report last week titled "Canadian wireless myths and facts"
that argued the Canadian market is healthy and that "it is time for the
regulators to declare victory on the policies they adopted five years
ago". Meanwhile, Open Media issued a report titled Time for an Upgrade: Demanding Choice in Canada's Cell Phone Market
that places on the spotlight on many of the ongoing problems in the
market, with a particular focus on consumer complaints. The report
includes many recommendations for regulatory and policy reform.
I'm a big fan of Chris Selley, the National Post writer behind Full Pundit, a daily look the Canadian editorial and opinion columns (last year Selley was also a vocal supporter of the much-needed Fire Ron Wilson
campaign). The Full Pundit features a summary of the most notable
editorial writing in Canadian media accompanied by quotations from the
original works. I'm quite sure that Selley does not ask for permission
to quote from those other works since fair dealing for news reporting
purposes permits their use without the need to do so. Yet if someone
wants to post a quote from Selley or anything else written by the
National Post, they are now presented with pop-up box seeking a licence
that starts at $150 for the Internet posting of 100 words with an extra
fee of 50 cents for each additional word (the price is cut in half for
For example, in
Pundit, Selley quotes John Graham in the Globe on the death
all but disappeared. â¦ Education and free health care are almost
universally available. â¦ Improving the quality of life for
millions at the bottom levels of society is no small
achievement. He also imparted to these millions a sense of
dignity about themselves and pride in their leaderâs often
If you try to
highlight the text to cut and paste it, you are presented with a
pop-up request to purchase a licence if you plan to post the
article to a website, intranet or a blog. The fee would be $150.
In other words, the National Post is seeking payment for text in
an article that was itself copied from the Globe. Of course, it is
not just Selley's work as many articles quote from other articles
or sources (for example, this Post
article on Taylor Swift is primarily quotes from Vanity
Fair. If you highlight a chunk of text, the licence message
pops up). If you click no to the pop-up, you cannot copy the text. If you click "quit asking me", the request stops.
None of this
requires a licence or payment. In fact, the amount of copying is
often so insubstantial that a fair dealing analysis is not even
needed. Last year, the Federal Court of Canada ruled
that several paragraphs from a National Post column by Jonathan
Kay posted to an Internet chat site did not constitute copying a
substantial part of the work. If there was a fair dealing
analysis, there is no doubt that copying a hundred words out of an
article would easily meet the fair dealing standard. In fact, the
Supreme Court of Canada has indicated that copying full articles
in some circumstances may be permitted.
The National Post is using iCopyright as its licensing service. The company provides a fair use statement that simply does not reflect the law, suggesting that fair dealing may not apply to the use of work that may generate revenues, is not highly creative, was available under licence, is something more than a footnote, or is posted to the Web. None of these are conditions that exclude the application of fair dealing and the recent Supreme Court of Canada decisions make it clear that the required broad and liberal approach would cover the excerpt copying for which iCopyright seeks payment. All media organizations rely on fair dealing to support a free and robust press. Those same organizations should not be undermining those hard earned users' rights by raising unnecessary licensing demands.
The government is
characterizing its Bill C-56 as an anti-counterfeiting bill, yet this
week NDP MP Charmaine Borg framed it more accurately as "ACTA through
the backdoor." During Question Period on Monday, Borg asked Industry Minister Christian Paradis directly if the bill paves the way for ratification of the discredited treaty:
Mr. Speaker, last July the European Parliament rejected the anti-counterfeiting trade agreement over serious concerns about the regressive changes it would impose on intellectual property in the digital age. Yet on Friday, the Conservatives introduced a bill in the House that would pave the way for the ACTA without question. Canadians have concerns about goods being seized or destroyed without any oversight by the courts. Will the minister now be clear with Canadians? Are the Conservatives planning to ratify ACTA, yes or no?
Paradis refused to respond to the ACTA ratification question:
Mr. Speaker, we are very happy to have introduced an anti-counterfeiting bill in the House. Counterfeiting is a growing problem in Canada. Counterfeiting deceives Canadians and is linked to security-related issues. So it was our duty to modernize the legislation to ensure that we can end counterfeiting, so that Canadians are not deceived, and to provide better security.
again with a direct link between Bill C-56 and ACTA:
Mr. Speaker, a
number of countries have rejected this unacceptable agreement.
The anti-counterfeiting trade agreement - ACTA - was drafted
behind closed doors and would incriminate the daily users of
cultural content. This agreement will turn our border officers
into instant copyright experts, without the adequate legal
support. Canada must seriously study the problem of
counterfeiting. However, the failure of Bill C-30 means that
Canadians do not have faith in this Conservative government. Is
Bill C-56 not simply a way to support ACTA through the back
the question once again:
Mr. Speaker, let
us be clear: Bill C-56 is a way to support and protect Canadian
Counterfeiting is a growing problem that must be stopped. Counterfeiting deceives Canadians and poses risks to the safety of Canadians. We must ensure that the legislation is updated and appropriate in order to equip the authorities with effective tools to fight counterfeiting, which is exactly what was introduced on Friday. If the NDP is responsible, I hope they will support us.
The 52 page bill requires careful scrutiny, but the NDP is right for drawing attention to the elephant in the room. ACTA has been rejected in Europe and stands as a discredited agreement. Despite that, Bill C-56 is fundamentally a bill designed to allow Canada to implement ACTA.
The Canadian introduction of Anti-Counterfeiting Trade Agreement compliance legislation on
Friday appears to have come in direct response to a new U.S.-led
effort to revive the discredited treaty. When the European
Parliament overwhelmingly voted to reject ACTA last July, many
declared it dead. But is not dead
yet: it is badly damaged and will seemingly never achieve the
goals of its
supporters as a model for other countries to adopt and to emerge
as a new
global standard for IP enforcement. But for the U.S., which
spent years pressuring ACTA participants to strike a deal, the
strategy now appears to revive the agreement by at least
garnering the necessary six ratifications for it to take effect.
The current ACTA signatories are Australia, Canada, Japan, Korea, Mexico, Morocco, New Zealand, Singapore, and the U.S. The European Union and Switzerland are out. Japan formally acceded in October 2012, which means the U.S. must find four more countries out of the remaining seven for ACTA to take effect. Canada is a clear target, as evidenced by the USTR 2013 Trade Policy Agenda released on Friday. It states:
The United States continues to encourage Canada to provide for deterrent level sentences to be imposed for IPR violations, as well as meet its Anti-Counterfeit Trade Agreement (ACTA) obligations by providing its customs officials with ex officio authority to stop the transit of counterfeit and pirated products through its territory.
Canada has no ACTA "obligations" - how could it given that the treaty is not in force and Canada has not ratified it - but the U.S. pressure paid quick dividends with the introduction of Bill C-56, which is clearly designed to put Canada into a position to ratify the agreement.
The Canadian government today introduced a bill aimed at ensuring the Canada complies with the widely discredited Anti-Counterfeiting Trade Agreement. Despite the European Union's total rejection of ACTA along with assurances that ACTA provisions would not resurface in the Canada - EU Trade Agreement, the new bill is designed to ensure that Canada is positioned to ratify ACTA by addressing border measures provisions. The core elements of the bill include the increased criminalization of copyright and trademark law as well as the introduction of new powers for Canadian border guards to detain shipments and work actively with rights holders to seize and destroy goods without court oversight or involvement.
While the bill could have
been worse - it includes an exception for individual travelers (so
no iPod searching border guards), it does not include patents, and
excludes in-transit shipments - the bill disturbingly suggests
that Canada is gearing up to ratify ACTA since this bill addresses
many of the remaining non-ACTA compliant aspects of Canadian law.
Moreover, it becomes
the latest example of caving to U.S. pressure on
intellectual property, as the U.S. has pushed for these reforms for
years, as evidenced by a 2007 Wikileaks cable
in which the RCMP's National Coordinator for Intellectual Property
Crime leaked information on a bill to empower Canadian border guards
(the ACTA negotiations were formally announced several months earlier). [Update: On the same day the Canadian government introduced Bill C-56, the U.S. Government issued its Trade Policy Agenda and Annual Report,
which calls on Canada to "meet its Anti-Counterfeit Trade Agreement
(ACTA) obligations by providing its customs officials with ex officio
authority to stop the transit of counterfeit and pirated products
through its territory"]
A full examination of Bill C-56 is forthcoming, but its introduction raises four immediate issues: that Canada is moving toward ACTA ratification, that it is pursuing policy based on debunked data on counterfeiting, that the bill could have serious harmful effects with border guards forced to serve as copyright experts without court oversight, and the increased criminalization of copyright and trademark law.
First, this bill provides a clear signal that Canada will
move forward with ACTA notwithstanding some doubts over whether
there is even sufficient global support to allow it to take effect
(six ratifications are needed). ACTA is toxic in Europe, where
officials now go out of their way to assure the public that ACTA
is dead and that any new agreements will not involve efforts to
revive it. ACTA has also faced serious opposition in other
negotiating countries, including Switzerland (which
has not signed it), Australia (where a Parliamentary
against ratification), and Mexico (where the Senate
rejected it in 2010). ACTA was promoted as a "gold standard"
agreement on counterfeiting, yet the failure to garner support
from many participants has left an agreement that is often cited
as an example of how not to engage in international
negotiations. Given the global opposition, Canadian support
for ACTA is disappointing.
Second, the government is framing
this legislation as being geared toward countering harmful
counterfeiting activities. Where counterfeiting raises health and
safety concerns, no one would oppose measures to address it. Yet
it should be noted that the data on counterfeiting has been
regularly debunked as inaccurate and overstated. The U.S. General
Accounting Office examined
the issue in 2010 and concluded that the oft-quoted
estimates are not reliable and cannot be substantiated to a data
source. A year later, the Social Sciences Research Council released
a major piracy report (funded by Canada's IDRC) that found little
evidence of organized crime involvement in piracy activities. In
2012, the CATO Institute posted
another assessment of the piracy claims, which it found were
Similar suspect data has been regularly used in
Canada. For years, the RCMP cited figures of $30 billion in losses
due to counterfeiting, but upon closer
examination (using the Access to Information Act), the
claims were found to be fatally flawed, based on little more than
a single bullet point in a slide presentation from an industry
group. The RCMP no longer cites the figure (and the bill's
press release notably does not provide an estimate), but the
Canadian Chamber of Commerce's IP Council still often
uses it. Counterfeiting is certainly a serious issue, but
the industry has consistently failed to provide reliable data to
allow for a meaningful assessment of the problem and potential
Third, the decision to grant border guards
increased powers without court oversight or review raises serious
concerns. Customs officials are not copyright and trademark
experts, yet they may now be forced to assess infringement cases
including determining whether any copyright exceptions apply. If
they fail to do so, it may result in wrongful seizures or
detentions of works. The bill opens the door to detention of
works (they cannot be imported or exported) if created without
consent of the copyright owner and if they infringe copyright. Yet
there many works that are made without consent of the owner but
rely upon exceptions such as fair dealing. Those may result
in disputes over whether the works infringe, which is an issue
best left to the courts. With this bill, customs officials will
now make the determination and send the works to the copyright
owner to consider whether they think it infringes copyright.
Moreover, there is a danger that parallel imports, which are not counterfeit product, may be targeted. Those products provide pro-consumer benefits of enhanced competition since the goods are legitimate but enter the market through alternative channels. The provisions also greatly expand border controls to both imported and exported goods (current controls are limited to imported goods), but there has been no evidence that Canada is a significant source of counterfeit product. There is also far greater information disclosures, with rights holders now able to ask for greater information sharing and assistance on imports and exports.
The bill will likely
be promoted as protecting public health, however, there is a
danger that the provisions could be used to stop the entry of
legitimate generic medicines. Sean Flynn highlighted
the concern in an ACTA analysis of border measures and
The problem with
trademark infringements is particularly complex and worrying for
generic medicines. Generic labels are required to be similar to
the brands. They must use the same words identifying active
ingredients, the same warnings and indications and other
information. In addition, they often desire to have similar
packaging and presentation as the brand drugs to help patients
switch between brand and generic with comfort. Requiring border
officials to identify which medicine labels are too âsimilarâ to
allow into the market is bound to lead to many more supply
interruptions than if the measures were limited to criminally
counterfeit products that intentionally use identical marks.
were raised by European scholars in their analysis
of the ACTA provisions.
Fourth, the bill
shifts toward an increased criminalization of copyright and
trademark law. It adds copyright and trademark offences to
the criminal code as well as establishing the possibility of
prison terms for trademark infringement.
This is a 52 page bill that makes numerous changes to the Copyright Act and Trade-Mark Act, requiring careful study. Yet the starting point is to move Canada toward ACTA, to create new border measures powers that could have adverse consequences on legitimate activity, and to extend the criminalization of copyright and trademark law in Canada.
Industry Minister Christian Paradis was in the news this week (Globe, Post, Cartt.ca)
urging foreign telecom companies to consider investing in the Canadian
market in order to beef up the competitive environment. Paradis is right
to court the big foreign players, who would bring capital, buying power
that the current Canadian carriers can't match (potentially leading to
better deals on devices), and the ability to leverage their global
networks to offer better roaming rates. Foreign telecom companies should
view the Canadian market as attractive, given some of the highest ARPU (average
revenue per user) rates in the world (see CRTC Figure 6.1.9). Yet they will likely give Canada a pass due in part to failed government policies. These include:
1. Ongoing foreign investment
restrictions in the telecom sector. The government has removed
restrictions for the smaller players (anyone with less than ten
percent market share), but those companies are less than ideal as
a market entry point given the use of spectrum that is incompatible
with devices such as the iPhone, incomplete network coverage, and limited
geographic footprint. The larger players - Bell, Telus, and Rogers
- are far more attractive but are off-limits due to the continuing
foreign investment restrictions. The solution is obvious: the
complete removal of all foreign investment restrictions in
2. Ongoing foreign investment
restrictions in the broadcast sector. Even if the
restrictions on foreign investment were lifted in the telecom
market, the restrictions in the broadcast sector would likely keep
Bell and Rogers out of the hands of a foreign entity. As
before, Canada should also remove the broadcast
restrictions, since Canadian broadcast licensees will follow
content regulations and regulatory obligations regardless of their
3. Failed spectrum policies.
Paradis indicated that the 700 MHz spectrum auction will take
place by the end of 2013. This is the same auction that was supposed
to happen last year and that was completed by the U.S. in January
2008. If the auction slips to early 2014, that will
place Canada six years behind the U.S. in allocating this
spectrum. The conclusion for a foreign carrier looking at the
Canadian market is clear: the government just isn't serious about
creating the framework to allow for vibrant wireless services.
4. Missing digital economy
strategies. Closely linked to the other failures is the absence of
a digital economy strategy, despite repeated
promises of one. If the government can't articulate
its vision for Canada's digital future, why would it expect a
foreign company to do so?
Canada needs foreign investment to address the
competitive shortcomings that plague the wireless sector.
But it will take more than speeches to encourage entry.
Rather, it will require policy action by the government to address
the myriad of barriers and shortcomings in the Canadian legal and
As reports of yet another government security breach emerge, NDP MP Charmaine Borg has at least tried to kickstart the government's dormant private sector privacy reform efforts with a private member's bill
that would add mandatory security breach disclosure requirements to the
law along with new order making power. The government's own privacy
reform bill - Bill C-12 - has languished for years with no real effort
by Industry Minister Christian Paradis to move it forward. Moreover, the
bill has some serious faults, with no penalties for security breach, no
update to the Privacy Commissioner's powers, and provisions that make
organizations more likely to disclose personal information without
warrant during an investigation.
Bill C-475 is a far better proposal with amendments to PIPEDA with more clear cut security breach disclosure requirements along with order making power that is backed by significant penalties for compliance failures. Those provisions would do far to ensure greater respect for Canadian privacy law and give Canadians the assurance of notifications in the event of security breaches. What the bill does not do, however, is address the other side of the privacy coin, namely the failure of government to hold itself accountable for the personal information it collects and now regularly seems to fail to safeguard.
Canadian and European officials traded public barbs
yesterday over the inability to finalize the Canada - EU Trade
Agreement. EU Trade Commissioner Karel De Gucht said unless Canada
makes some additional steps, there will be no deal. Canadian officials
responded that Europe has yet to meet Canada's core concerns. The
comments come after a ministerial meeting this month was unable to yield an
agreement. De Gucht and Canadian International Trade Minister Ed Fast
met in Brussels in November 2012, but those talks failed to solve the outstanding issues. The two ministers met again in Ottawa two weeks ago with a similar result.
While officials continue to put a brave face on the
talks, the latest comments suggest mounting frustration at the
unwillingness of either side to cave on key issues in order to strike a
deal. The major remaining issues
have been the same for months: agriculture, patent protection for
pharmaceutical companies, investor access and protection, public
procurement, automotive issues, and cultural protections. Indeed, these
issues were identified years ago as the major areas of disagreement
(copyright was initially on this list but the defeat of ACTA removed it
as an issue).
The business opposition to Canada's anti-spam
legislation has added an unlikely supporter: the Canadian Recording
Industry Association, now known as Music Canada. The organization has
launched an advocacy campaign
against the law, claiming that it "will particularly hurt indie labels,
start-ups, and bands struggling to build a base and a career." Music Canada is urging people to tweet at Canadian Heritage Minister James Moore to ask him to help bands who it says will suffer from anti-spam legislation.
Yet Music Canada's specific examples mislead its members about the impact of the legislation. The organization offers seven examples posted below in italics (my comments immediately follow):
Bands and labels will struggle to build fan bases.
This is just rhetoric. It isn't a specific
example and doesn't explain how the legislation will do this.
Social media may be hampered, and you may have to unsubscribe fanbases - because you can't confirm whether they continue to want to receive electronic updates. If you have electronic newsletters or mailing lists, you may need to remove recipients, because you no longer have consent to send them, and you're prevented from seeking consent electronically.
Social media based on consent won't be hampered
as the law permits this form of marketing with consent. It is true
that email marketing lists will shift to opt-in, but the existing
lists mentioned by Music Canada are valid for three years after
the law takes effect (meaning they will likely remain valid until
2017). Contrary to what Music Canada says, the law does not
restrict using electronic consent to update those existing lists
during that time period.
An independent label wouldn't be able to "cold call" a venue through email or other electronic communication to recommend they have a concert featuring one of their artists. Bands would face similar limitations to self promotion.
There are several exceptions that allow for
this form of marketing. Venues that place email contact
information on their websites without a notice barring unsolicited
commercial email can be sent relevant electronic communications by
labels or bands. Moreover, third party referrals of bands will
qualify for an exception, labels or bands with a prior business
relationship with a venue can use the business-to-business
exception, and labels or bands with personal relationships can use
those to send commercial emails to venues. This covers the vast
majority of these communications, but if Music Canada is saying
that spamming venues in the rare situations not covered by an
exception is a key marketing strategy, perhaps it is time for a
Your digital distribution of such things as
music, videos, and e-zines delivered by email or instant
messaging may trigger the legislation, especially if they
contain links to additional corporate information like your
website or logo.
So what? As long as you have consent, there is
no concern. In other circumstances (distribution to radio
stations, etc.), the communications are covered by exceptions.
Social media campaigns may be crippled. Express consent will be required before forwarding communications to neighbours, schoolmates, acquaintances, colleagues, and certain extended family members.
Untrue. Social media campaigns based on consent are not blocked by the law. Moreover, there is an exception for personal relationships that would likely exempt the need for express consent for neighbours, schoolmates, acquaintances, colleagues, and certain extended family members.
You may need to invest in expensive
processes to comply with the new across the board
requirements for express consents, disclosures, and unsubscribe formalities.
Privacy law already requires organizations that
collect, use, and disclose personal information to maintain
processes that respect opt-out requests. Surely Music Canada is
not suggesting that its members breach current privacy laws by
failing to invest in the systems needed to properly track the
personal information they collect along with opt-out requests.
You may also need to make substantial
investments in new tracking and compliance systems or face the
threat of class action law suits from the expected CASL
litigation trolls under the new private right of action.
As noted above, compliance with current privacy law requires systems to respect opt-out requests. With respect to the threat of lawsuits, there is a certain irony that the industry that introduced lawsuits against individuals for file sharing (CRIA members first commenced such actions in 2004) and brought us the Sony Rootkit debacle is now concerned with lawsuits against its own members for failing to abide by an anti-spam and spyware law.
Christopher McKay, who faced a driving while under the influence charge, told police that he wanted to exercise his right to legal counsel. McKayâs cellphone and other personal belongings were placed in a police locker when he arrived at the station. McKay was told there was a toll-free number available to contact a lawyer as well as White and Yellow pages that could be consulted. He called the toll-free number but was unable to find assistance.
My weekly technology law column (Toronto Star version, homepage version) notes that what followed was the product of a demographic deeply familiar Hollywood movies and reliant on the Internet. McKay assumed that he had used his single phone call and did not consider using directory assistance (411), which he did not think was a "viable search engine." Instead, he noted that Google was his main method to search for information.
In fact, the judge conducted a Google search for "Calgary criminal defence lawyer" and found that within seconds there was provided with a long list of potential local lawyers. Moreover, the judge noted that police routinely use the Internet for investigations and evidence gathering.
The Charter of Rights and Freedoms grants anyone arrested or detained the right "to retain and instruct counsel without delay and to be informed of that right." For this judge, the failure to provide Internet access meant that the Charter rights had been violated, concluding:"In the year 2013 it is the Court's view that all police stations must be equipped with Internet access and detainees must have the same opportunities to access the Internet to find a lawyer as they do to access the telephone book to find a lawyer."
The decision will undoubtedly raise eyebrows among criminal lawyers and law enforcement officials, yet it continues a growing trend around the world that elevates Internet access to a quasi-legal right. In 2010, Finland became the first country in the world to make broadband Internet access a legal right for all citizens. A year later, a United Nations report concluded that disconnecting people from the Internet is a human rights violation.
For police, the decision may have resource implications, since providing Internet access will be more costly and cumbersome than pointing to a nearby telephone. It also points to how the Internet and new technologies force the continued rethinking of longstanding rules and practices as even Hollywood films may someday feature police directing an accused to an Internet-connected computer in order to exercise their right to counsel.