This blog is inscribed by Prabhdeep Kaur Malhotra.
The present submission tests If there a need to revamp the existing Provision?
Section 31D of the Copyright Act, 1957 that was added by way of the Copyright (Amendment) Act, 2012 provides for a mechanism to deal with the public interest vis-à-vis the private interest. The objective behind enactment was to strike at the monopoly that may be detrimental to the larger interest of the public keeping in view the interest of the owner. The provision facilitates access to works for the broadcasting industry by providing a statutory license for broadcasters. Before this amendment, the access to copyrighted works was dependent upon voluntary licensing.
The Draft Copyright (Amendment) Rules, 2019
The Draft Copyright (Amendment) Rules, 2019 propose to substitute the words “radio broadcast or television broadcast” with “each mode of broadcast”. Clause 3 of Section 31D specifically mentions: “…. (3) The rates of royalties for radio broadcasting shall be different from television broadcasting and the Appellate Board shall fix separate rates for radio broadcasting and television broadcasting.” The provision nowhere indicates the applicability of the rates of royalties for internet broadcasting as they apply to the radio and television broadcasting. In the absence of such provision, the insertion of “each mode of broadcast” in place of “radio or television broadcasting” requires a re-visit of Section 31D of the Act to widen the scope and ambit of the term “broadcast” to include each mode of broadcast including internet broadcasting to widen the scope of statutory licensing.
In countries like the United States, laws have made a distinction between interactive and non-interactive broadcasters to obtain statutory licenses. This issue has nowhere been deliberated in the Indian Copyright Law. The judgment of Bombay High Court in Tips Industries v. Wynk Music[i] is important in this regard. It was held that the provisions of Section 31D do not apply to internet broadcasting. It was observed:
“The internet broadcasting organizations cannot enjoy the benefits of a Statutory License under Section 31-D. The intention of the Legislature while enacting the amending legislation viz. the Copyright (Amendment) Act, 2012, South India Music Companies v. Union of India, Decided on 30th March 2016. 2 Commercial Suit IP (L) No. 113 of 2018. was to restrict the grant of Statutory License under Section 31-D to radio and television broadcasting organizations.”
The term “broadcast”[ii] as defined under the Copyright Act, 1957 means the act of transmitting the copyrighted work through the wire or wireless diffusion and not making it ready for the diffusion. Further, the term “communication to the public”[iii] is wider than “broadcast” because broadcast is just one form of public communication. Communication to the public i.e. “making any work or performance available” would necessarily mean the copyright owner making it available.
In case of internet streaming services, when the owner of a copyright-protected work (sound recording, cinematographic film, etc.) gives such services, he will get a license to make a “copy” of it on a server belonging to it or to allow the said service to “rent” it to the consumer. These rights are governed by Sections 14(d)(i) and 14(d)(ii) of the Act. Therefore, internet streaming services are not covered under the definition of “communication to the public” and are, therefore, not a “broadcast” under Section 2(dd) of the Act.
Internet Broadcast v. Traditional Broadcast
Internet Broadcasting has certain distinguishing features which makes it different from other forms of comparable services, viz. traditional broadcasting services (conventional television and other such media). The ‘pull’ based curated content (narrowcast), provided by curated content providers is opposed to the ‘push’ based content provided by broadcasting services. The critical distinction between the two is that in the case of push-based services, the content is mass distributed (hence the term broad in broadcasting) via a push model of dissemination. For these platforms, the user decides what content to consume and therefore is a ‘pull’ model of dissemination.
For statutory license, certain terms that apply to the radio or television broadcasting may not apply to internet broadcasting. For instance, Sub-rule 4(b) of Rule 29 of Copyright Rules, 2012 which says that notice under sub-rule (1) shall contain a particular territorial coverage where communication to the public is to be made is not applicable in case of internet broadcasting as the geographical coverage may be difficult to locate. Similarly, details of time slots, duration, and period of the program find no place in the pull-based services. Clause (a) of sub-Rule 7 states that the Board while determining royalty shall take into consideration the following factors, one of them is the time slot in which the broadcast takes place and different rates for different time slots including repeat broadcast. Due to the differences mentioned above, such a factor does not apply to internet streaming services as the same happens independently without the allocation of any time slot.
What can be done?
Most of the internet-based services are not broadcasters in the conventional sense of the term. What is required along with the conditionalities for obtaining statutory licensing is to allow all forms of internet service providers to avail of the statutory licensing facilities. For the proposed rules to take effect, the relevant provision under the Act needs to be amended first because rules cannot be ultra vires of the Act. Therefore, an amendment to s. 31D or rules thereof should be considered after consultation with the relevant stakeholders.
The story does not end here. The tariff scheme as provided under Rule 56 of the Copyright Rules has been amended to include various considerations to be kept in view by the Copyright Society while fixing the tariff. These are cross-sectional tariff comparisons, economic research, the nature, scope, and use of the work, commercial value of rights in use, and benefits to licensees. Insertion of these considerations will give absolute discretion to the Copyright Society to decide the rate of tariff which can have a positive impact as well as a negative impact. The already existing provision under Sub-rule 3 of Rule 56, which provides separate rates of tariff scheme based on different durations of use and territory for its applicability to the internet broadcast is ambiguous. Hence, the re-visit of the Copyright Act, 1957 is required to bring clarity under the newly amended Rules.
Further, the amendment to Sub-rule (1) of Rule 49 which deals with the conditions for registration of copyright society, says that “When an application for registration is submitted to the Central Government through the Registrar of Copyrights, that Government may, either register the applicant as a copyright society or if…..” The said amendment omits the time frame mentioned under the original rules i.e. “within sixty days from the date of its receipt by the Registrar of Copyrights” which is a requirement.
It is a well-settled principle of law that the intention of the legislature must be considered while interpreting any act or provision of law. While enacting Section 31D of the Act, the legislature was aware of the advent of the internet and digitalization of works. The benefits of statutory licensing were not available to any other mode other than “Television” and “Radio” broadcasters. Sub-section (3) of Section 31D makes the intention of the legislature clear by mentioning separate royalty rates for “Television” and “Radio” broadcasters. The entertainment industry has undergone a sea change in the past few decades, enabling the ease of access to the internet and digitalization. Various streaming companies have played an instrumental change in the outreach of the services provided by them. In such a scenario the spirit of the Act is defeated by providing an unbridled right to such entities at the cost of copyright owners.
[i] Commercial Suit IP (L) No. 113 of 2018, decided on 23-04-2019.
[ii] The Copyright Act 1957, s. 2(dd).
[iii] The Copyright Act 1957, s. 2(ff).