Cablegate: Evolution of Industry Response to Canada's Draft

This record is a partial extract of the original cable. The full text of the original cable is not available.

311946Z Oct 05





E.O. 12958: N/A



1. (SBU) Summary: Canadian rightsholders seem to be
positioning themselves to accept notice and notice as a step
in the negotiations surrounding Canada's proposed amendment
to the Copyright Act. Internet service provider (ISP)
liability waivers in the draft text have rightsholders
fearing that Canada may again become an IPR "wild west" with
legal filesharing. Rightsholder industries are also united
in their despair over the weakness of remedies against
technological protection measures (TPMs). Proponents of weak
or nonexistent copyright continue to publish and lobby
Parliament, where a special committee to review the proposed
legislation is expected to be formed by mid-November. End

2. (SBU) Although most Canadian rightsholder industry
associations still publicly hope for a notice and takedown
regime, industry reps have privately told econoff that they
are preparing to accept the currently-proposed notice and
notice system in the course of negotiations with GOC. In
fact, some industry associations plan to use the anticipated
USG insistence on notice and takedown as a chance to play
good cop to our bad cop, and they will present their
acceptance of notice and notice as a signal to the GOC that
they are willing to be "more reasonable than the Americans".

3. (SBU) Industry representatives are newly concerned that
the wording of the internet service provider (ISP) liability
waiver in the proposed amendments may be interpreted to again
make peer-to-peer filesharing legal in Canada, an eventuality
that industry representatives on either side of the border
will see as disastrous. Section 31.1(1) of the draft
amendment states, "A person who, in providing services
related to the operation of the Internet or other digital
network, provides any means for the telecommunication of a
work or other subject-matter or a reproduction of it through
that network does not, solely by reason of providing those
means, infringe copyright..." and section 31.1(2) adds that
"a person...who performs any other acts related to the
telecommunication that render it more efficient...does not,
by virtue of those acts alone, infringe copyright..."
Industry representatives fear that peer-to-peer filesharing
services could be argued to be a "means for the
telecommunication" and an act to "render it more efficient"
and therefore could be exempted from liability under these

4. (SBU) The question of technological protection measure
(TPM) circumvention continues to focus on two concerns: the
need to prove intent to infringe in order for circumvention
of TPMs to be considered illegal, and the fact that the bill
as drafted contains no language making the trafficking of
circumvention "tools" (such as video game mod chips or
DVD-hacking software) illegal. Both of these concerns have
been prevalent in industry commentary since the draft text
was first tabled (see reftels). Some commentators have
suggested that "trafficking in tools" could be somehow folded
into or added to the section that provides legal remedies
against a person who "offers or provides a service to
circumvent" (section 34.02(2)).

5. (SBU) Meanwhile, in the midst of this chorus of industry
displeasure at the content of C-60, a lone happy ISP
representative presented a very upbeat reaction at last
week's C-60 conference in Toronto. Seemingly, ISPs have no
complaint with the text of C-60 as drafted--in fact, this
representative's only substantive input was to ask that
rightsholders be required to pay ISPs to forward and retain
the notices of infringement under the notice and notice
scheme (as currently laid out in section 40.2(2) of C-60.)
The fact that ISPs are the sole enthusiastic and
fully-satisfied stakeholder in the process highlights the
bargaining power of the ISPs in this process. They have been
given a bill which exempts them from any liability for
infringing content on their members' sites and does not
require them to take down such infringing material unless
there is a court order; in addition, they will potentially be
able to charge stakeholders for the notice process itself.

6. (SBU) "Copyleft" academics who argue against copyright in
general continue to receive significant press time and seem
to be increasing their lobbying efforts directed at
Parliament. University of Ottawa professor and columnist
Michael Geist has published a collection of papers claiming
to put the reform proposals into context ("In the Public
Interest The Future of Canadian Copyright Law" available at for C$50 or for free download). His
University of Ottawa colleague Ian Kerr addressed a breakfast
in the Parliamentary dining room last week on the subject of
C-60. Dr. Kerr is another "information wants to be free"
advocate, and he focused on what he sees as a need for
protection against TPMs, since in his opinion they can too
easily become surveillance devices that invade the privacy of
users. (Comment: an econ staffer was present in the audience
and attempted to provide a balancing view, pointing out that
Canada's existing laws do not put excessive power in the
hands of rightsholders. End comment.)

7. (SBU) We expect the bill to be put before an as-yet
unformed special committee, which should be assembled by the
middle of November. Parliamentary insiders suggest that the
special committee may make the process faster, but few
observers expect that the bill will pass before Parliament
faces another election which is expected by Spring 2006
(comment: faced with such a flawed document, some industry
representatives are stuck hoping that the legislation, for
which they pushed so long and hard, will die in committee.
See ref A for details.)

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