Copyright

Novex Communications Pvt. Ltd. v. DXC Technology Private Limited – Analysis II


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Summary and Analysis I

Is it mandatory to be a member of copyright society to carry out the business of issuing or granting licences in respect of literary, dramatic, musical and artistic works incorporated in a cinematograph film or sound recordings?

I am of the view that the copyright framework gives authors and owners of right an option to join or not join a copyright society in order to conduct the business of issuing or granting licences in respect of literary, dramatic, musical and artistic works incorporated in a cinematograph films or sound recordings. This means that Section 33 must be interpreted to be applicable only to the members of the copyright society.

I disagree with the judgment for the following reasons:

Firstly, a copyright society can a) issue licenses; (b) collect fees; (c) distribute such fees amongst authors and other owners of right; and (d) perform functions consistent with Section 35. (Section 34(3)). Against this background, consider

34. Administration of rights of owner by copyright society.

(1) Subject to such conditions as may be prescribed,— (a) a copyright society may accept from an author and other owners of right exclusive authorisation to administer any right in any work by issue of licences or collection of licence fees or both; and

(b) an author and other owners of right shall have the right to withdraw such authorisation without prejudice to the rights of the copyright society under any contract.

……………..

As evident from above, an author and an owner of right has the right to withdraw authorisation concerning licensing and collection of licensee fees. If an author has to necessarily conduct business concerning cinematographic films only through copyright society, then the question of withdrawing authorisation does not even arise (since an author cannot carry out these business functions outside the copyright society). If one examines the functions carried out by copyright society, it becomes clear that issuing licenses and collecting fees are at the core of the envisaged functions. The other functions (namely, distribution of fees amongst members and performing functions in accordance with Section 35) are concomitant to the main functions of issuing licenses and collecting fees. Section 34, therefore, hints at the choice architecture for authors and owners of right.

Secondly, if it is made mandatory to join a copyright society for conducting business, then it severely limits the options of authors and owners of right Of note, the Central Government shall not ordinarily register more than one copyright society to do business in respect of the same class of works (Section 33(3)). The net consequence is that the author and owner of right will be forced to remain in the copyright society even if she/he does not want to.

It is true that section 33 provides certain safeguards if the copyright society acts against the interests of authors and owners of right. The central government can deregister copyright society if it acts against the interests of authors and owners of rights. But that does not provide an option for an author or owner of agent who is dissatisfied with the copyright society at an individual level and does not want to continue with the copyright society. An extreme interpretation, as adopted by the Madras High Court, would severely limit the freedom of authors and owners of right in exercising their own rights. I am not sure as to how such an extreme interpretation would protect the legitimate interests of authors and owners of right.

[ Relevant Provisions

Section 33. Registration of Copyright society

(3) The Central Government may, having regard to the interests of the authors and other owners of rights under this Act, the interest and convenience of the public and in particular of the groups of persons who are most likely to seek licences in respect of the relevant rights and the ability and professional competence of the applicants, register such association of persons as a copyright society subject to such conditions as may be prescribed:

Provided that the Central Government shall not ordinarily register more than one copyright society to do business in respect of the same class of works.

…………………….

(4) The Central Government may, if it is satisfied that a copyright society is being managed in a manner detrimental to the interests of the authors and other owners of right concerned, cancel the registration of such society after such inquiry as may be prescribed.

……………………]

Mathews P. George

Mathews is a graduate of National University of Juridical Sciences, Kolkata. His interest in intellectual property was kindled when he bagged the second position in his second year of Law School (in the prestigious Nani Palkhiwala Essay Competition on Intellectual Property). His stint as a student of Prof. Shamnad Basheer further accentuated his interest in intellectual property. Winner of almost a dozen essay competitions in his Law School days, he was involved in various research and policy initiatives relating to intellectual property. Mathews is, currently, based out of Munich, Germany. He had earlier done his LLM in 'IP and Competition Law' from Munich Intellectual Property Law Centre (jointly run by Max Plank Institute for Innovation and Competition, University of Augsburg, Technical University of Munich and George Washington University, Washington).

One comment.

  1. Jagdish Sagar

    You’re absolutely right. It is a complete misreading of the law–and an innovation of the last few years– to suggest that licensing cannot be carried out except through a copyright society. In fact, to stop a copyright owner’s lawful business on such grounds would be an infringement of his fundamantal rights under Article 19(1)(g) of the Constitution. There are more arguments to add to yours, in fact.

    Reply

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