The Copyright Rules in India were notified in 2013. While the Copyright Rules, 2013 (“Copyright Rules”) have been in place for over six years, a practical impossibility in implementation of the rules has rendered the same ineffective. Absence of a functional Copyright Board has further added to the woes, making the Copyright Rules redundant.
The Copyright Rules in India were notified in 2013. While the Copyright Rules, 2013 (“Copyright Rules”) have been in place for over six years, a practical impossibility in implementation of the rules has rendered the same ineffective. Absence of a functional Copyright Board has further added to the woes, making the Copyright Rules redundant.
In the second set of amendment to the Copyright Rules, 2013 (“Copyright Rules”), the Department for Promotion of Industry and Internal Trade, Government of India (“DPIIT”) has proposed a policy which seeks to address the lacunae of the Copyright Rules, with a greater emphasis on the concerns of the inevitable intersection of copyrighted works and the internet. The draft Copyright (Amendment) Rules, 2019 (“Draft Rules”), inter alia, propose changes to the statutory licensing for the broadcasting of literary, musical works and sound recording, the manner of operation of copyright societies, and modification to the explanation of performance. The Draft Rules further seek to replace the Copyright Board with the Appellate Board, giving effect to the Amendment introduced to the Copyright Act by Finance Act, 2017. Through this article, the authors provide a brief overview of the Draft Rules, with a primary focus on changes brought to the statutory licensing regime, copyright societies and the definition of performance.
The Draft Rules by way of proposed amendments to Rules 29- 31, seek to modify the scope of statutory licensing by extending its application to ‘each mode of broadcast’. The Rules seem to further the intent of the Office Memorandum dated 05.09.2016 issued by the Department of Industrial Policy and Promotion, which sought to expand the scope of Section-31-D of the Act by making it applicable to Internet Broadcasting Organizations.
Interestingly, while Section 31-D of the Act was purposefully limited by the legislators to television and radio broadcasting, the Draft Rules extend the scope of statutory licensing to each mode of broadcast, which includes the internet.
The Draft Rules certainly seek to address the issues arising out of excessive use of digital streaming platforms; however, the same seems to be devoid of the necessary statutory sanction that must be lent to any delegated legislation. In the recent judgment of Tips Industries Ltd. v. Wynk Music Ltd. & Anr.3, the Bombay High Court held Section 31-D of the Act to be in the nature of an expropriatory legislation and observed that the said provision ought to be regarded strictly in consonance with the legislative intent. In light of the categorical determination of this legal issue by the Bombay High Court, it seems a tad bit difficult as to whether the Draft Rules will sail through the judicial test as and when the same are notified. While the effort in the Draft Rules seems to give an expanded definition to ‘broadcasting organization’; however, a more prudent way to address the issue would be to bring an amendment to the Act whereby the specific reference to ‘radio and television’ sector is either removed or the meaning of broadcasting organization is kept open-ended to include all modes of broadcasting.
The Draft Rules bring about a robust ‘governance model’ to regulate the functioning of the copyright societies. In order to ensure fair and transparent management of a copyright society, the Draft Rules propose to insert sub-rules 11- 13 under Rule 58 of the Copyright Rules. As per the proposed rules, in the event that royalty collected by a copyright society remains undistributed due to non-identification of the relevant author or owner, despite all efforts of the copyright society to locate and identify such authors and owners, the copyright society will be obligated to keep such undistributed royalties in separate accounts of the copyright society. In case such undistributed royalty remains with the copyright society, at the end of three years from the end of the financial year in such royalty was collected, the copyright society will be bound to refund the undistributed license fees to the licensee within a period of three months from the end of such financial year. Needless to say, these refund norms will introduce greater accountability of the copyright society towards its members as well as the licensees.
In order to further the fair governance model, the Draft Rules also seeks to insert a mandatory ‘Annual Transparency Report’ policy by introducing an additional rule to Copyright Rules (proposed Rule 65A). The proposed rule mandatorily requires a copyright society, to make public disclosure of the ‘Annual Transparency Reports’, on its website. The said report ought to inter alia record information pertaining to:
Hopefully, the Draft Rules will streamline the functioning of copyright societies and ensure that a registered society lives up to the legislative intent and purpose behind its creation.
Finally, the Draft Rules may settle the dispute surrounding the meaning of the term ‘performance’, an issue which has kept authors, owners, broadcasters and copyright societies at loggerheads before the courts.
The Copyright Act limits the meaning of performance4 to only ‘live performance’ as understood in the general connotation of the term ‘performance’. Instead of bringing an amendment to the Act, a change was sought to be implemented to the meaning of performance by way of the Copyright Rules, under Explanation 3 to Rule 68(4), which expanded the scope of ‘performance’ to even include studio recordings. The explanations to Rule 68 sought to change the interpretation of the phrase “made live”, to extend and apply it to “pre-recorded” presentations. This in effect rendered the phrase “made live” completely redundant and otiose. Further, expansion of the legislature’s intent, by way of Rules could fall foul as the same would tantamount to overreach of power and the scope of delegated legislation.
Since the inception of Copyright Rules, Explanation 3 Rule 68(4) of the Copyright Rules has been the constant cause of mischief, under the garb of which the copyright societies dealing with performers’ rights have sought to claim performance royalties even on account of exploitation of underlying works, broadcast, rebroadcast or communication to the public. Particularly, the claims of the copyright societies were strengthened by the judgment of the Delhi High Court in Neha Bhasin v. Anand Raj Anand5 which held that performance under the statute would also encompass any performance rendered by an individual in the studio or otherwise.
By way of the Draft Rules, the DPIIT has finally acknowledged the above concerns of the stakeholders. With the proposed amendment which seeks to omit Explanation 3 to Rule 68(4) of the Copyright Rules, the meaning of performance as intended to be limited to ‘live performance’ will be restored back thus, bringing a ray of hope for broadcasters.
In addition to the above, the Draft Rules have done away with the procedure of publication of notices in the official gazette in case of compulsory as well as statutory licensing, substituting the same with mere publication on the website of the Copyright Office.6 Similarly, a notice of applications in respect of any license sought by any entity from the Appellate Board may be served through electronic means instead of the earlier mode of service which was limited only to registered post.7 The Draft Rules, in a way, aim to ease the procedure under the Copyright Rules.
The Draft Rules are a step forward to bring the Indian Copyright law in parity with other relevant legislation. They introduce a sea of change to the existing Copyright Rules with a view to cater to the interest of stakeholders, in light of the increasing demand in the digital space. However, in the absence of any amendment to the Copyright Act, it cannot be said with certainty that the Draft Rules, standalone, have the authority to address and cure the conflicts arising out of this internet driven age. The fact that the DPIIT has kept the Draft Rules open for consultation, there is still hope that the Draft Rules will receive its fair share of comments. It will only be a matter of time when the success of the Draft Rules can be tested, once the same is Notified.
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