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Back in December, 1999, Canada’s federal Heritage Minister Sheila Copps dropped a big lump of coal in a lot of Canadians’ Christmas stockings in with the Copyright Board of Canada’s announcement of rates for a new “levy” on recordable media, intended to fund a compensation plan for recording artists whose financial estate is harmed by people pirating copyrighted music off records, tapes and CDs. The legislation had been originally passed in 1998.

Industry bagmen at the Canadian Private Copying Collective, estimate that it collected and distributed about $22 million in fees to musicians lin 2001.

The levy is paid by manufacturers and importers of blank media in Canada to the CPCC. The CPCC then distributes the monies collected (minus administration fees) to registered artists. The Copyright Board sets the rates, but does not collect them.

I am on record as being pretty vehemently opposed to this scheme, which seemed like a tax ripoff by any other name, and an abandonment of the principle of “innocent until proven guilty,” by presupposing that everyone who purchases blank recording media is a thief. This constitutes a fascinating new innovation in jurisprudence; levy the fine presumptively before the crime.

However, perhaps there are diamonds hidden at the core of some lumps of coal, and the one here may be that Canada’s “levy” on recordable media pokes a gaping hole in the copyright protections, at least for Internet purposes, provided by America’s Digital Millennium Copyrigt Act, which the Recording Industry Association is currently using to sue the pants off 12 year old girls and oblivious grandparents whose computers have been used for illicit music downloads.

Vancouver blogger Jay Currie contends that the Canadian levy legislation makes music copying legal in the Great White North. Jay writes:

Jay suggests that:

He further observes that:

"...the 1998 amendments to Canada’s Copyright Act “were passed with earnest lobbying from the music business. The amendments were really about home taping. The rather cumbersome process of ripping a CD and then burning a copy was included as afterthought to deal with this acme of the digital revolution. The drafters and the music industry lobbyists never imagined full-on P2P access.... This is a fatal oversight, because P2P networks are international. While the Digital Millennium Copyright Act may make it illegal to share copyright material in America, the Canadian Copyright Act expressly allows exactly the sort of copying which is at the base of the P2P revolution.... In fact, you could not have designed a law which more perfectly captures the peer to peer process.... In Canada, if I own a CD and you borrow it and make a copy of it that is legal private copying; however, if I make you a copy of that same CD and give it to you that would be infringement. Odd, but ideal for protecting file sharers....in Canada it is expressly legal to share music. If the RIAA were to somehow succeed in shutting down every “supernode” in America all this would do is transfer the traffic to the millions of file sharers in Canada. And, as 50% of Canadians on the net have broadband (as compared to 20% of Americans) Canadian file sharers are likely to be able to meet the demand.”

Jay goes on to note that “The Canada Hole in the RIAA’s strategic thinking is not likely to close.... There is no political interest at all in revisiting the Copyright Act. Any lobbying attempt by the RIAA to change the copyright rules in Canada would be met with a howl of anger from nationalist Canadians who are not willing to further reduce Canada’s sovereignty.... Nor are there any plausible technical fixes short of banning any connections from American internet users to servers located in Canada."

You can read Jay Currie’s entire commentary here:
http://techcentralstation.com/081803C.html

However, some of that lump of coal is still coal. On March 9, 2002 Canada’s Copyright Board Commission announced that the “levy” will be increased sometime in 2003 on all blank audio recording media. Sample rates (in Canadian dollars):
• 60¢ for each audio cassette of 40 minutes or more in length
• 59¢ for each CD-R, CD-RW or each unit of any other type of recordable or rewritable compact disc of 100 megabytes or more of storage capacity;
• $1.23 for each CD-R Audio, CD-RW Audio or MiniDisc
• $2.27 for each DVD-R, DVD-RW, DVD+RW, DVD-RAM or each unit of any other type of recordable or rewritable DVD
• 0.8¢ for each megabyte of memory in each removable electronic memory card, each removable flash memory storage medium of any type, or each removable micro-hard drive
• 2.1¢ for each megabyte of memory in each non-removableelectronic memory card or each non-removable flash memory storage medium of any type incorporated into each MP3 player or into each similar device with internal electronic or flash memory that is intended for use primarily to record and play music
• $21 for each gigabyte of memory in each non-removable hard drive incorporated into each MP3 player or into each similar device with an internal hard drive that is intended for use primarily to record and play music. (ie: $105 extra on an iPod.)

Ouch! At least if Jay Currie is correct in his interpretation of Canada’s copyright laws, there is some compensation. ;-)

Charles W. Moore

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