Retail Council calls on majority Tory government to scrap private copying levy

Following the Canadian Private Copying Collective’s (CPCC) announcement of a second crack at a levy on digital memory cards, the Retail Council of Canada is urging the majority Conservative government to scrap the entire private copying mechanism in the Copyright Act. “We think the entire levy system should be eliminated, and this most recent attempt by the CPCC illustrates why,” Terrance Oakey, vice-president of government relations at the Retail Council, told The Wire Report in an interview. The CPCC, a non-profit agency that collects and distributes private copying royalties for songwriters, recording artists, music publishers and record companies, last week announced that it is asking the Copyright Board of Canada to establish a levy on electronic memory cards to compensate artists and other rights holders for private copies of their works. The levy would vary depending on the card’s capacity, starting at 50 cents for cards capable of storing less than 1 GB, $1 for 1-8 GB cards, and $3 for 8 GB and up, the CPCC proposed. It's not the first time the collective has proposed the idea. The organization had requested the memory card levy in 2003 and 2004, but the Copyright Board declined, unsatisfied with the evidence that cards were being used to copy music at the time. The CPCC also commenced proceedings to have the levy certified in 2008 but withdrew the initiative part way through the process. “When we saw the final evidence that we would have had to go to the board with, we realized it wouldn’t come up to par, so we withdrew,” David Basskin, a spokesman for the CPCC, said in an interview. “This time it's different.” He pointed to new CPCC research, from surveys conducted by Circum Network Inc., that shows 18 per cent of Canadians have copied data onto memory cards and 16 per cent of that data is music. Oakey said the Retail Council plans to argue against the levy. “We have heard loud and clear from our members that they are against this tax," he said. “They’re going after any device that is even remotely related to music. I think the government should take note of this and will act.” Howard Knopf, a copyright lawyer with Macera & Jarzyna LLP who has represented the Retail Council in its arguments against a digital media levy, said people use memory cards primarily to store documents and photos, not music, and that it would be unfair to “tax” everyone who buys a memory card. Right now, the private copying levy only applies blank CDs, and with CD sales tumbling, it won’t be long before the levy is largely pointless, he said. Knopf said he believes the Conservative government—which in a minority position has been expressly opposed to a proposal to extend the levy to digital media players—has been “waiting for this thing to just wither on the vine.” A few years down the road, the government could have quietly done away with a then-largely-useless levy mechanism. But now that the CPCC has requested a memory card levy, the government may be tempted to scrap the whole private copying regime, he said. “I think there’s serious backfire potential here,” he said. Through legislative amendments, he said the Conservative majority government could essentially remove Part VIII of the Copyright Act, which outlines the levy system. The Tories staunchly opposed an NDP and Bloc Québécois plan to extend the levy to digital media players, releasing political attack ads that branded the proposal an "iPod tax." Asked whether the CPCC’s proposal to the Copyright Board could backfire, Oakey said: “It is something that we would like to see. I have not had anyone in government tell me that that is their plan. I think what this has done is proved that the CPCC has overreached.” But Basskin said that’s unlikely. “That would mean that every copy people made would go back to being an infringement,” he said. “The thing about Part VIII is that it legalizes the private copies in exchange for a levy. If the government wants to recriminalize making private copies, it sure doesn’t sound to me like a good idea.” Knopf said it’s a waste of time and money—“six or seven figures”—for organizations like the Retail Council to make their cases to the Copyright Board to “prove what is obvious: that use of these cards is minimal.” Canadian copyright expert Meera Nair said it’s difficult to tell whether the Copyright Board would grant the CPCC its request. “What is known is that small businesses are implicated in this levy,” she said, noting that higher memory card prices would mean increased technology costs for companies, and that small businesses are more likely to use memory cards for data backup. Larger companies tend to use automated cloud-based backup services, but “the simple solution for small business owners is to do it themselves,” she said. news@thewirereport.ca

Retail Council calls on majority Tory government to scrap private copying levy

Broadcast | May 24, 2011

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