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Cyberpiracy north of the border

Are Canada's file swappers next in line to be prosecuted? The University of Ottawa Internet expert Michael Geist tells CNET what to expect.

The Recording Industry Association of America is suing hundreds of Americans for allegedly sharing copyrighted music on peer-to-peer networks. But so far, their Canadian neighbors have not been targeted for file swapping, even though networks such as Kazaa, Grokster and Morpheus appear to be just as popular north of the border.

A recent study, conducted by Canada's AssetMetrix, of 560 companies whose employee numbers range from 10 to 45,000 employees found file-swapping software installed on at least one computer in 77 percent of cases. Last fall, Bell Canada sought to ease congestion in its network by imposing additional fees for broadband customers who exceed download limits of between 2 gigabytes and 20 gigabytes a month.

A big reason for the lack of lawsuits against file swappers is Canada's different legal system, which provides additional protections for peer-to-peer downloaders.

CNET spoke to Michael Geist, the Canada research chair in Internet and e-commerce law at the University of Ottawa, about copyrights, spam and other topics. Geist is also technology counsel to Osler, Hoskin & Harcourt, and he writes a newspaper column on cyberlaw.

Q: Can Canadians legally download copyrighted music from peer-to-peer networks?
A: The short answer is: Nobody knows for sure. But the issue is far murkier than in other jurisdictions like the United States. The key provision in Canada's copyright legislation is a private copyright exemption that lets Canadians make private copies for noncommercial use. The way we justify the exemption is by way of a levy that applies to blank media such as blank CDs and blank audio cassettes.

Canada has yet to enact any digital copyright legislation along the lines of the DMCA.
With the exemption, there are many who believe that those who download music for noncommercial purposes from P2P networks could avail themselves of this legal defense. This has never been tested in court. The recording industry is of the opinion that this violates the spirit of the law if not the letter.

What do you think?
I'm inclined to think that you'd have a pretty good argument as an individual user--that personal, noncommercial copying is permitted by the exemption.

The one caveat--and this is where there have been many myths--is that there is little doubt under Canadian copyright law that making those same songs available to others is not permissible.

So you can download all you want, but you can't share what you've downloaded?
That's right. It's very clear that the exemption applies only to individuals who make copies and does not authorize others to make copies.

When people compare the situation in the United States to the situation in Canada, it's a bit of a misnomer to say we couldn't see the same suits arise. In Canada, the making available of songs would be treated in a similar fashion.

Do any countries let people share copyrighted material without penalty?
I don't know of any. There might be jurisdictions that don't address the issue, but I don't know of any jurisdiction that would explicitly create an exemption for making copyrighted works available.

Because you don't have the Digital Millennium Copyright Act and its turbocharged subpoenas, is it more difficult for copyright holders to unmask alleged pirates?

The vast majority of ISPs will only remove content when presented with a court order--not a mere claim by a copyright holder.
Without a doubt. That, to me, is the bigger issue in terms of lawsuits in Canada. Unlike in the United States, where there is the subpoena power under the DMCA, Canada does not have a similar power under either its copyright law or any other law for that matter.

Is there any serious interest in changing it?
Canada has yet to enact any digital copyright legislation along the lines of the DMCA. This is a topic that has been under consideration. Topics like the DMCA subpoena powers are part of the mix.

My sense is that policy-makers look at the experience in the United States with a significant amount of concern. So, I don't know that it's likely that even if we get digital copyright legislation, we would see a similar set of subpoena powers.

What else would a digital copyright law cover?
There are number of things. A notice and takedown system is one. Here in Canada, we don't have a situation similar to that of the United States, so the vast majority of Internet service providers will only remove content when presented with a court order--not a mere claim by a copyright holder.

And the DMCA's anticircumvention section, which SunComm recently used to threaten a Princeton University graduate student?
We don't have anything like that, either. Digital rights management and circumvention issues are not part of our copyright law.

Is Canada a freer country when it comes to the Internet, as a result?
Based on an innovation perspective, we haven't run into the same problems the United States has, with lawsuits brought against researchers, garage door manufacturers and printing companies. Most Canadians look at those cases and are rather puzzled.

How much pressure from industry groups is there to move in this direction?
For the last few years, there's been a fair amount of lobbying and promises from the government to move forward with some kind of copyright reform. The government has set forth a five-year plan, and digital copyright is at the top of the list. That said, I think policy-makers have a real concern with the experience they've seen in the United States.

What benefit is there in embracing the WIPO (World Intellectual Property Organization) copyright treaty, which inspired the DMCA?
There are those who say there is very little. Canadian policy has long been that it plans to become WIPO-compliant. It isn't clear yet what the advantages would be for Canadians.

You mentioned the taxes the Canadian government levies on blank media such as CDs. Right now, they're 22 cents (29 cents in Canadian currency) on audio cassettes and 59 cents on CD-R audio. Doesn't that create an incentive for Canadians to drive across the border and buy bulk CDs in the United States?
There are some that might. For users who don't use a huge amount of this media, that doesn't make sense. There are certainly fears that the levy creates a gray market that hurts retailers and at the end of the day doesn't provide much funding back to the artists, because people shop elsewhere.

If you're a software manufacturer, and you buy thousands of blank CDs, you pay the levy just as the file sharers might, and you're effectively subsidizing file sharing. There's a real fairness issue.

Why was it enacted?
People have always copied music. This was initially designed to deal with small-scale personal copying. The initial tariff was focused on things like audio cassettes, through which much of the copying occurred. Of course, that's changed dramatically in recent years.

The current taxes are called an interim tariff. What happens next?
Even more controversial are prospects that the levy would apply to blank hard drives--to computers potentially and right now to MP3 players.

Would the MP3 device, or just its hard drive, be taxed?
It would be calculated based on the size of the hard drive. If the Copyright Board of Canada were to accept that, it would raise the cost of Apple Computer's 20-gigabyte iPod by about $77.

Is it just the Copyright Board that can determine how high the tax will be, or does it require a new law from Parliament?
It's just the Copyright Board that's charged with setting the tariff. But parties can appeal the decision. These cases can literally drag out even on a single tariff 10 years or more.

But the tariff itself accrues retroactively. At some point, there's a final determination, and the tariff applies. There won't be a tariff set until 2008 or 2010 until all the appeals go through the Canadian court system.

Is there a tax or tariff on music downloads?
There is no tariff yet. There is not even an amount that would be raised. The initial questions are: Will there be a tariff, and to whom would it apply? Those are issues the Canadian Supreme Court will examine in December.

What antispam laws has Canada enacted so far?
We already have many of the pillars for antispam legislation in Canada, namely privacy legislation and the Criminal Code. It could be applied to the more clearly criminal type of spam.

What types of e-mail senders does it cover?
It applies to federally regulated companies such as banks, broadcasters and transportation companies and will apply to all Canadian organizations in January. The law requires the organizations to obtain appropriate consent for the use and disclosure of personal information. E-mail addresses are clearly personal information. In many instances, an opt-out approach would not be seen as sufficient.

What's your take on last month's remarkable report from government auditors that said George Radwanski, Canada's ex-privacy commissioner, was responsible for a "reign of terror" in his own office?
The revelations that have come from the auditor general of Canada have been very damaging and have not been answered by the former privacy commissioner. They've had a huge impact on the credibility of the office.