Canadian Coalition for Fair Digital Access
The Canadian Coalition for Fair Digital Access (CCFDA) was established to advocate the concerns of Canadian businesses, consumers and individuals affected by the copyright levy regime Canada. CCFDA members include major Canadian retailers, consumer product manufacturers and technology companies.
The companies represented in the coalition believe that the private copy levy regime is fundamentally flawed, too broad in scope and should be repealed. Canada needs an approach that is fair to all parties, ensures transparency and accountability, protects copyright holders, does not slow the introduction of new technologies, and encourages flexibility to be responsive to consumer practices and to new technologies.
The Canadian Coalition for Fair Digital Access (CCFDA) supports copyright protection that is fair to copyright holders, consumers and other stakeholders.
Canada’s current private copy levy regime is flawed and should be repealed.
- The existing levy regime is indiscriminate
The system forces consumers, individuals and business alike to pay a fee on certain audio recording and storage media, even if they don’t use them for recording copyrighted sound recordings.
- The scope of the levy regime is too broad
The scope of the private copying provisions under the current legislation is so broad that a number of commonly-used products such as personal computers, consumer electronics and other multi-purpose storage media technologies – that serve many purposes other than recording music – risk having levies applied to them. Flash memory, for example, is used in PDAs and digital cameras. A significant expansion of the scope of the levy would impose unreasonable new costs on Canadian businesses, consumers and public institutions.
- The existing regime is bureaucratic and inefficient
Consumers have already paid over $28 million in levies to the Canadian Private Copying Collective (CPCC) since the private copying provisions of the Copyright Act came into force. The CPCC has publicly conceded that, to date, none of this money has been paid out to the composers, performers and producers (artists) intended to benefit from the levies.
The existing regime is unfair to consumers
- Levies on new technologies increase costs to consumers
Consumers are forced to pay extra costs even when the products are not used to record copyrighted music. Moreover, existing legislation allows for the possibility that levies might be extended to new products such as personal computers, consumer electronics and multi-purpose storage media. If this were to happen, it would sharply increase costs for consumers.
- Levies are hidden charges to consumers
Most consumers are unaware that levies are embedded in the price of many products capable of recording music. These levies account for a significant amount of the purchase price. For example, today a consumer purchasing 100 blank CD-RWs pays $21 in levies; proposed changes would increase this charge to $59.
- Levies force some consumers to pay twice
Consumers who are paying for copies of sound recordings through subscription-based services or other means of digital distribution must also pay levies on blank media.
The existing regime is unfair to business
- Levies on new technologies risk increasing costs to business
Applying levies to products used by business such as personal computers, consumer electronics, and other multi-purpose storage media would add another cost for businesses that utilize information technology. These products are particularly important to improving the competitiveness and productivity of Canadian business.
- Levies risk impeding the introduction of new products into Canada
The imposition of levies on a broader range of products, if it occurs, may also deter suppliers from introducing new technologies into Canada. Some companies may decide not to introduce specific new products to certain markets that have onerous and unpredictable levies. Such an outcome would be very harmful in Canada, as businesses could be denied access to new technologies that they need to facilitate innovation and remain competitive.
- Increased costs may lead to the creation of grey or black markets
Canadian businesses stand to lose substantial sales if consumers circumvent levies by purchasing products in the U.S. The resulting grey or black market, would not only harm Canadian business, but would also lead to a reduction in government revenues from GST and PST.
The existing regime is unfair to artists
- The current regime does not provide reasonable copyright protection
Canada’s levy system has no effective means of ensuring that the copyright holder whose music is copied is actually the person receiving compensation. By contrast, for example, digital technology in the form of technical protection measures (TPMs) and Digital Rights Management Systems (DRMS) makes it possible for the copyright holder to receive market priced compensation each time a new copy is made.
- The existing levy regime creates no incentive for change
New technologies and business models for digital distribution have been developed that are more effective in compensating artists while protecting copyright. The existing levy regime discourages copyright holders from adopting new methods of protecting copyright even as they are becoming more widely available.
- The CPCC is not accountable to anyone except its collectives
It is not clear how much of the levies collected ultimately will go to artists and how much will be used to subsidize administrative overhead associated with collecting activities, or for legal and other professional fees paid out to secure further levy increases. Moreover, there is no mechanism for interested stakeholders to ensure that this money is distributed fairly.