On March 17, the Norwegian Ministry of Culture sent out a proposal for a new Copyright Act. The legislators aim for better protection for the rights of creative and performing artists in an up-to-date form and language. The proposition is now being circulated for public comment until August 8 2016.
New form and updated language
The legislation that is in force today is the Copyright Act of 1961. A lot has happened in the field of IP rights since 1961. Following recent decades of significant technical evolvement, the ways to utilise copyright have changed.
The act of 1961 has been altered several times, but this has made the law complex and hard to comprehend for non-lawyers. In addition to this, the language of the old act is outdated. The proposal will amend this by restructuring the regulations and giving them a modern wording, but the content will mostly be the same.
The proposal includes some alterations of the existing regulations. Some of the alterations are merely codification of non-statutory law, some are implementation of EU directives and others are legislative innovations. In general, the Ministry of Culture wants to strengthen the opportunities creative and performing artists have to utilise their copyright in the digital era.
Right to reasonable compensation
The most important new provision is the originator’s right to a “reasonable compensation” when realising or transferring his copyright for commercial use. Under the current Copyright Act, a copyright holder can - due to the freedom of contract - sell his rights at any price, even for free. The Ministry of Culture reports that a considerable number of artists are forced to sell their copyrights at an unreasonably low price. Under the new Act, reasonable compensation is mandatory. Thus, an agreement to transfer copyright for a very low price or for free will not be binding to the originator, who can demand a reasonable compensation.
In addition to this, in a dispute regarding to what extent a copyright holder has transferred a right to his work, the burden of proof shall be borne by the acquirer, and if the proof is not clear, the transfer shall be interpreted in favour of the originator.
Further, anyone who has acquired an exclusive right to make the copyrighted work available to the public has an obligation to use this right within three years from when the originator fulfilled his obligations under the contract, or the originator can terminate the contract.
The above-mentioned rights intend to strengthen the originator’s rights, especially from a commercial point of view, though there may of course be some difficulties for the court determining what a “reasonable compensation” implies. The proposed provisions can also put participants such as producers in a squeeze between originators with strengthened rights and distributors who want all rights cleared at a low cost. However, the producer will now be able to tell the distributor that the originator is entitled by law to a reasonable compensation. Hopefully, this can result in better contracts with the different participants of the industry, such as directors, writers, actors and musicians.
The Ministry of Culture wants stricter consequences for infringements of copyright. The condition for sentencing prison or imposing fines is proposed to be “wilful intention” instead of the current “negligence”, but the maximum penalty will be raised from three months to one year of imprisonment.
Further, the legislators propose new provisions with a wider range of possibilities for claiming damages from infringements. Under the proposed provisions, a wilful or negligent infringement will give the copyright holder the opportunity to choose the alternative he finds most favourable of the following:
1. reasonable compensation for the use and damages that would not have occurred if the use was agreed upon,
2. damages occurred from infringement, or
3. compensation equivalent to the net profit of the infringement
The current Copyright Act includes (2) and (3). Alternative (1) is new, as well as the regulation that the copyright holder can choose the most favourable alternative. This way, it will be simpler for the copyright holder to find a legal basis for his claim.
By both the old and the new Act, if the infringement has been wilful or grossly negligent, the copyright holder will be entitled to damages for non-economic loss. Under the new Act, he can claim “the double of reasonable compensation” instead, which is a simpler and more dogmatic way to determine the size of the compensation.
What created most headlines in Norwegian media is a proposed regulation that will illegalise streaming of for example movies and TV series from illegal sources. Under the current Copyright Act, downloading of copyright protected material from illegal sources is illegal. However, the outdated legislation does not cover streaming. Opposite to downloading, streaming is not considered as producing a copy. Further, the average internet user is not obliged to consider whether the content of a website is made available by consent of the copyright holder.
The Ministry of Culture – together with many copyright holders – considers this state of law as unacceptable, and proposes to make it illegal to “use a work that obviously has been made available to the public illegally on the Internet or any other electronic communication net when use from the illegal source is able to cause considerable damage to the originators economic interests”. Thus, if the new Act passes, Norwegian law will not allow the use of pirate streaming services. However, penalties can only be imposed if the infringement is made by wilful intent.