Copyright

Amendment to S.2(m) – Copyright Standing Commitee Report


Continuing with my series on analysing the Parliamentary Standing Committee’s report on the amendments to the Indian Copyright Act, in this post, I will focus on the proposed definition of ‘infringing copy‘ under Section 2(m) of the Act (I apologise for the long gap between the two posts – been having trouble with my laptop the past few weeks)
CURRENT PROVISION:
Clause 2 (m) of the Act defines the expression ‘infringing copy’ as a (a) reproduction of a literary, dramatic, musical or artistic work ; (b) a copy of a cinematograph film made on any medium by any means or (c) any other recording embodying the same sound recording, made by any means or the sound recording or a cinematographic film or (d) broadcasting of a programme or performance if reproduction of sound recording is made or imported in contravention of the provisions of the Act.

PROPOSED AMENDMENT:
The proposed amendment to this definition involves an addition of a proviso to the Act, stating:

“provided that a copy of a work published in any country outside India with the permission of the author of the work and imported from that country into India shall not be deemed to be an infringing copy”.

IMPLICATION OF THE AMENDMENT
To understand the basic implications of the amendment, it is wise to take a few steps back and understand the underlying concept of parallel imports. Essentially, parallel importation involves the act of of bringing in a copyrighted product of one country, into another country, without the permission of the copyright owner in the latter country. So, for example, if a book is available for purchase in Russia, and it is legally purchased there, and then imported into India, without the permission of the owner of copyright in India, it would amount to a parallel import.

In the context of this amendment, parallel imports must be understood in light of the territoriality principle, wherein rights to distribute books are commonly split up and assigned based on territory. So, an Indian publisher might have the right to publish and sell a book in India, to the exclusion of a Candaian, Nepali and Pakistani publisher.

The effect of the amendment is to eliminate this principle of national exhaustion and allow for free import of books published in another country, as long as the author of the work has given his consent, irrespective of whether the permission of the Indian publisher (for example) has been given for such importation.

IMPACT ON INDIAN PUBLISHERS/BROADCASTERS
The biggest opposition to the amendment appears to be coming from the Indian publishers and broadcasters. For example, the South India Music Companies Association (SIMCA) stated that the amendment would act as a significant disincentive for Indian sound recording labels, much like themselves, to obtain licenses from foreign producers. The Association of Publishers in India argued on the basis that Indian publishers would not be allowed to sell Indian editions in protected markets abroad, and that, the amendment failed to understand the fundamental system on which the publishing industry operated. The Federation of Indian Publishers even contended that the amendment would give rise to litigation between authors and publishers, because of the erosion of publishers’ rights.

ILLEGAL IMPORTS
The Indian Motion Picture Producers’ Association argued against the amendment by stating that it would result in illegal importation, without the consent of the owner of the copyright. The Business Software Alliance also argued that it would create imbalance of trade and illegal channels of distribution would develop. But the fact remains that if parallel importation is allowed, these copies would not be considered infringing. Of course, custom authorities would still have to distinguish between parallel imports that are legally purchased and counterfeit products, and a system will have to be developed to deal with this situation. The Indian Broadcasting Foundation expressed fears that consumers would be granted access to foreign works, before their formal release in India. But, in my opinion, if the foreign work is legally purchased, I don’t really see a problem in it being made accessible to consumers in India before the ‘scheduled release date’. It certainly isn’t piracy.

SUPPORT FROM AUTHORS GUILD
The Authors Guild of India was alone in its support of the amendment, from amongst the participants. They presented the benefits authors and remarked that in the age of globalisation, this was a step in the right direction.

EDUCATIONAL BOOKS & BENEFIT TO STUDENTS
Those in favour of the amendment stress on the benefit that would accrue to students who currently purchase textbooks at exorbitant rates, but with the amendment, would be able to purchase them at much lower rates. However, the Federation of Indian Publishers and the Association of Publishers in India resisted this contention as well by arguing that ‘with this amendment, the low priced editions meant for Indian sub-continent could be exported back to the country of their origin where they were priced at much higher rates.’ They argue that foreign publishers would be thus unwilling to sell books at subsidized books in India for this reason, ‘fearing low priced Indian editions flooding and diluting their own markets.’

However, this entire argument is premised on the assumption that export of low-priced editions is legally permissible. However, this is arguable, given the decision of the Delhi High Court in the case of John Wiley & Sons (discussed by Prashant in this post), where the Delhi High Court held such exports to be illegal. However, the proposed amendment, may in fact allow such export on the principle of international exhaustion.

Further, in my opinion, the amendment only pushes Indian publishers to innovate and adapt and price their books in such a way so that it would economically unfeasible for someone to import the same work to India from another country. Moreover, it was disheartening to notice that there were no civil society organisations, student groups or library associations at the Standing Committee meeting, to present the opposing view, in support of the amendment.

AMENDMENT IS AGAINST NATIONAL INTERESTS
The Motion Picture Association argued that eliminating India’s rule of national exhaustion was against the country’s interests since the current law ‘keeps prices low, allows exclusive distribution systems to be maintained, and help bring a strong domestic copyright industry.’ This statement itself is easily rebuttable, in my opinion. For one, parallel imports would certainly not detract from keeping prices low. Secondly, ‘maintaining exlcusive distribution systems’ appears to me to be a mere euphemism for ‘maintaining monopolies’, which is certainly not the objective of copyright law. Lastly, ‘a strong domestic copyright industry’ is one that allows for and encourages competition and innovation, instead of merely maintaining status quo, something that is being vehemently opposed by the publishers.

STANDING COMMITTEE’S RECOMMENDATION
The Standing Committee noted that the current practice based on territorial licenses resulted in very high rates and availability of low priced books was confined to old editions. It stressed on the benefit to students and while cautioning the Government to ensure that the objective of amendment is achieved, it supported the proposed amendment to Section 2(m).

WIDESPREAD DEBATE ON THE AMENDMENT
Because of the word-restrictions, I have only outlined the submissions made to the Standing Committee, while touching on the implications in brief. However, we would like to encourage readers to comment and discuss this particular amendment, which seems to have sparked off great debate online. For example, Pranesh Prakash of CIS has blogged in response to Thomas Abraham’s article (MD, Hachette India) in the HT on the issue, and rebuttals have followed since. Although the amendments affecting the Bollywood industry have taken centre-stage, there are several issues that are worthy of discussion here as well and we welcome readers’ comments.

(Image from here)

3 comments.

  1. AvatarMadhukar Sinha

    Dear Amlan,

    I read your post with interest. I agree with most of your points. I think the arguments made by the opponents are fallacious and largely to protect their possible future interests which, as per the information available with us at the time of the drafting of the said amendments, were in the realm of conjecture.

    I would recommend you may also like to discuss the issue with a trade economist who would be able to do some simulations on the possible impact of international exhaustion on cross-border trade based upon the existing data.

    Best wishes
    Madhukar Sinha

    Reply

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