Ad Hoc Alliance for a Digital Future

Towards the Digital Future:
Achieving an Appropriate Balance in a New Treaty on Copyright

A Diplomatic Conference is scheduled in Geneva for December 2-20, 1996 to adopt a new treaty on copyright/author s right (the so-called Berne Protocol). While laudable in its overall aims, the draft treaty (the Basic Proposal) contains the following elements that threaten to hobble the Information Society in its infancy, including:

  • the definition of the copyright owner s exclusive right of reproduction to include temporary (ephemeral) copies;
  • the adoption of a right of communication to the public; and
  • the prohibition of so-called protection-defeating devices.

Although many provisions of the Basic Proposal have been under discussion since 1991, and consensus has been reached with respect to most of those provisions, the above proposals were introduced within the last year as part of a so-called Digital Agenda. Indeed the controversial proposal on ephemeral copies surfaced only this May -- and certainly no consensus exists among interested European parties on the Digital Agenda. Because of the potentially crippling effects of the Digital Agenda provisions on the development of the Information Society, it is essential to achieve a balanced set of proposals.

In particular, intense discussion is in order not only with those who create content, who clearly deserve proper protection, but also with those who will deliver content, including telecommunications companies, Internet access providers and other on-line service providers, libraries, and educational institutions (collectively referred to as OSPs) as well as those, including computer hardware and consumer electronics manufacturers, who will provide various off-line delivery mechanisms. These participants, who will build and provide the information infrastructure itself, must have legal security about their potential copyright responsibility -- or they will either be deterred from making the investment necessary to make the Information Society a reality or they will be forced to so tightly control access that the potential of the Global Information Infrastructure as a global information content and distribution mechanism will be severely undermined. In its current form, the Basic Proposal fails to provide legal security to infrastructure providers concerning the extent to which they may be held responsible for the infringing acts of those who use the infrastructure.

The purpose of the Digital Agenda, which we wholeheartedly share, is to update the venerable Berne Convention on the Protection of Literary and Artistic Works to take account of the new digital environment. Paradoxically, however, the approach employed by negotiators in Geneva fails to take account of the reality of the digital world. In particular, the Basic Proposal fails to take account of the following four basic facts about the Information Society:

  • First, making temporary (or ephemeral) copies is an essential element of transmitting information over the network, as it is to permit users to access the information on the network.
  • Second, OSPs generally do not have any control over or knowledge of the vast quantity of content transmitted over their networks or the paths those transmissions may take.
  • Third, the Information Society will be truly global, so the creation of absolute treaty rights (for example, a right to make ephemeral copies in computer memory), and providing for exceptions to those rights only on a national basis, is no longer tenable. This approach may have worked in the days of physical copies that could be stopped at national borders, but it no longer works where information travels across global networks without boundaries.
  • Fourth, so-called technical protection systems will be used by copyright owners to prevent the making of lawful as well as unlawful copies. Thus, if devices facilitating the defeat of technical systems that prevent users from making such lawful copies are outlawed, the current balance in the copyright law will be upset. Use exceptions, for example, are at risk of being eliminated without debate.

Should Copyright Holders Have The Right To Control All Ephemeral Copies?

The reproduction right gives a copyright owner the exclusive right to make copies of his work. Article 7(1) of the Basic Proposal would require signatories to treat temporary copies, such as ephemeral copies in network servers random access memory (RAM), as reproductions that would infringe the exclusive reproduction right. The explanatory notes to the Basic Proposal take the view that the reproduction right should give a copyright owner the exclusive right to control such acts as uploading and downloading a work to or from the memory of a computer, including its working memory. Moreover, any form of remote copying that is made possible by a communication network between the original and the copy is intended to come within the reach of this definition.

While some insist that this definition of what constitutes reproduction in a copyright sense is settled law, the truth is that this question is far from settled, and indeed is highly controversial, both in academic commentary and court judgements both in Europe and the United States. More importantly, the approach taken in the Basic Proposal conflicts directly with the practical realities of the digital world.

In particular, the Basic Proposal s definition of reproduction conflicts directly with the reality of how the Internet and other networks actually operate. The transmission of a document from one user to another usually involves the ephemeral reproduction of the document in each of the many computers the document passes through as it moves from sender to recipient. These ephemeral copies are of no value other than technically to facilitate transmission.

Under the Basic Proposal, every time a copyrighted work is sent via the network without initial authorisation, each of the ephemeral copies required for transmission would become a copyright infringement. Moreover, the process of caching, which involves storing copies of materials for very short periods of time at remote locations to speed up the network, would also constitute copyright infringement under these circumstances. Technology does not presently exist that would enable each system through the transmission network to determine whether or not each portion of each work transmitted has been authorised.

Turning to the user side, if the definition of the reproduction right is extended to include the making of temporary or ephemeral copies, the innocuous acts of surfing or browsing would also constitute infringing reproduction. Each time someone browses information on the network (by displaying it on the screen of his computer) a copy of that information is stored temporarily in the random access memory (RAM) of the computer. This RAM copy would, under the Basic Proposal, constitute reproduction for purposes of copyright. Such reproductions are automatically deleted from RAM once a computer is switched off.

Given these realities, one must ask why anyone might legitimately regard it to be necessary to include anything like Article 7 in the new treaty. Many countries have, for example, for years allowed broadcasters to make ephemeral recordings, as permitted by Article 11 bis (3) of the Berne Convention, without any adverse effect on rightholders. Is it really necessary to raise and decide such a controversial issue at this time?

Although the explanatory notes to Article 7 acknowledge that its definition of reproduction is broader than that applied by many signatories to the Berne Convention, the notes argue that potential problems with the expansive approach are cured by Article 7(2), which permits national exceptions. Article 7(2) provides that individual signatory countries may, but need not, provide exceptions for temporary copies provided:

  • (a) the temporary reproduction has the sole purpose of making the work perceptible or (b) where the reproduction is of a transient or incidental nature; and
  • the reproduction takes place in the course of use of the work that is authorised by the author or permitted by law; and
  • the tripartite test of Article 9(2) of the Berne Convention is met (i.e., the exception is for a special case and the permitted reproduction does not conflict with a normal exploitation of the work and does not unreasonably prejudice the legitimate interests of the author).

There are two basic problems with this approach. First, by allowing national exceptions (under a rather complicated formulation), rather than establishing global limitations on the reproduction right, proposed Article 7 would ensure that those who transmit content on the global networks would face widely divergent exceptions around the world.

National formulation of copyright exceptions may have been adequate in the days of physical copying and traditional broadcasting, where reproductions could be contained within or close to national borders, but this approach now ignores the reality of the global information infrastructure. Because the very purpose of the new treaty is to update copyright law to reflect the new global digital reality, and because one of the fundamental characteristics of the global information infrastructure is that it knows no national boundaries, Article 7 should contain appropriate mandatory limitations on the reproduction right rather than merely permit national exceptions. Otherwise, the possible imposition of liability for making ephemeral copies during the course of OSP transmissions could severely inhibit OSP activities in every country connected to the network.

Some have contended that providing such global limitations in the treaty, rather than merely permitting national exceptions, is inconsistent with the approach traditionally employed in intellectual property treaties. However, this is incorrect. For example, the Berne Convention includes such a limitation on the reproduction right for quotations, and, as noted above, Article 11 bis (3) limits author s rights.

The second, and equally important, basic problem with the approach contained in Article 7(2) is that it does not permit enactment of exceptions relieving OSPs from infringing copyright for unknowingly serving as a conduit for unauthorised copies put on its network by users. Every day, OSPs will automatically transmit tens of millions of digital messages, and transmitting each message will invariably require the OSP to make several ephemeral copies of the message. Because it is technically and economically infeasible for an OSP to monitor all these messages (especially those that have been encrypted by their sender), the OSP will not know whether a particular item transmitted on its network is authorised or unauthorised, and therefore the OSP should not infringe copyright by serving as a conduit for infringing copies put on its network by users. As currently formulated, however, Article 7(2) provides no respite to OSPs at all, because it would render non-infringing only authorised ephemeral reproductions made by OSPs during the course of transmissions.

Should OSPs Infringe the Right of Communication to the Public Merely by Serving as Conduits? Article 10 of the Basic Proposal would grant copyright owners an extended right to control any communication to the public, including making their works available to the public by wire or wireless means, in such a way that members of the public may access these works from a place and at a time individually chosen by them. The practical impact of the proposal is to protect by copyright all electronic transmissions of a copyright work, and effectively to vest in the rightholder a broad-reaching exclusive right of electronic dissemination of its works. Although an expanded communication right may indeed be appropriate to protect content owners in the global environment, the proposal currently on the table fails to adequately take into account the facts of how the network operates and the corresponding needs of infrastructure providers and users. Most importantly, the proposal does not clarify who is responsible for violating the communication right -- the person who initially puts the work on the system, the OSP, or both? And what constitutes communication to the public?

Paragraph 10.10 of the explanatory notes takes the view that what counts [should be] the initial act of making the work available, not the mere provision of server space, communications connections, or facilities for the carriage or routing of signals. Nonetheless, the explanatory notes take the view that it is for national legislation and case law, rather than the treaty, to define what constitutes public within the meaning of Article 10. The notes furthermore state that it would be inappropriate for the treaty to take any view on liability because who is liable for an infringement of these rights and what the extent of liability shall be for such infringements is a matter for national legislation according to the legal traditions of each contracting party.

As described above in relation to Article 7, it is not acceptable in a seamless global environment to leave it to the signatory countries to decide on a patchwork basis whether, and to what extent, OSPs will be liable through acts of transmission for violating the right of communication, notwithstanding the fact that OSPs effectively have no control over the information transmitted over their networks. In all cases, it will be economically infeasible to ask OSPs to screen the materials transmitted over their networks. Moreover, in many cases, it will be technically impossible for an OSP to screen the materials because the message will be encrypted. And, even if OSPs could screen every transmission to ensure that they contain no potentially infringing material, encouraging them to do so would raise serious privacy concerns.

Given the reality that OSPs have no knowledge or effective control over the content of a communication, it is not appropriate to permit national legislation that would define infringement of Article 10 s right of communication to include OSP transmission activities. Moreover, as in the context of Article 7, such a system would mean that the highest common denominator of liability established in even a single country would effectively set the rules for all the world. The combined effect of proposed Articles 7 and 10 would be to create a legal regime depriving OSPs of legal security and requiring them to accept the risk that they will engage in copyright infringement with every transmission. Infrastructure providers are deciding now whether to invest in building the global information infrastructure, and the legal uncertainty created even by the threat of liability for violating the rights established by Articles 7 and 10 would dramatically inhibit investment in the infrastructure, the features and functions of the resulting network, and development of new public services by libraries and distance-learning activities by educational institutions.

The uncertainty created by combining an absolute treaty right with unclear exceptions would harm not only infrastructure providers, but also content providers and the public as a whole. While some might think OSPs would carry merrily on building infrastructure, the truth is that few companies would accept the huge risks flowing from potential liability for the infringing acts of their users, and thus the number of infrastructure competitors would be limited. Both reduced competition, and the large reserves built into their cost structures for potential copyright infringement by those companies which do accept these risks, would increase the cost of the network to the point where it would never deliver its promised economic and social rewards. So limiting the development of the infrastructure, and reducing the number of on-and-off ramps to the information superhighway, can hardly benefit copyright owners. In short, it is not enough for the explanatory notes accompanying the Basic Proposal to indicate that Article 10 should not lead to liability on the part of OSPs merely for serving as conduits for infringing material. Instead, a limitation along these lines should be added to Article 10 itself so that both content providers and OSPs will receive appropriate legal security.

Should the Treaty Contain Any Provision on Protection-Defeating Devices?

Article 13 of the Basic Proposal would outlaw any protection-defeating device where the device manufacturer or distributor had any reason to know that it would be used to facilitate any infringement, including the making of even a single infringing reproduction.

Few would disagree with the concept of prohibiting technologies like satellite descramblers, the sole purpose of which is to facilitate piracy. However, as currently formulated, Article 13 of the Basic Proposal would also endanger legitimate business behaviour and undermine the existing balance in the copyright/author s right law. Computer makers, for example, take the view that -- by focusing on devices that could be used to circumvent copy-protection mechanisms rather than acts of infringement and by adopting a standard that covers a wide-range of multi-purpose devices -- Article 13 creates a significant risk that general purpose computers and related hardware and software could be caught in its reach. At the same time, the proposal s focus on devices may shift enforcement resources away from the infringers themselves.

Moreover, consumer electronics manufacturers observe that Article 13 could be interpreted to require them to alter their equipment, such as VCRs, to function with a variety of different protection systems. This would be technically and economically impossible, at least until there is standardisation of copy protection devices (as each device would require a different technical modification of the equipment). Moreover, it is feared that these modifications would degrade and impair consumer electronics products and their uses.

In addition to threatening such dual-use technologies, i.e., technologies that can be used both for circumvention and for other purposes, Article 13 would endanger technologies specifically intended to permit circumvention, but for lawful uses. The following example illustrates this problem: Let us say an enterprising young company identifies a market for protection-defeating devices to enable the libraries to make lawful archival copies of digital works to which a technical protection system has been applied. The young company, with the intent only to facilitate lawful library activities, produces the circumvention device and actively markets it to only to libraries in countries where the law clearly permits libraries to make reproductions for archival purposes. After several months, the device manufacturer receives a letter that the device has been used in a single instance to facilitate infringing reproduction.

Where does this leave the device manufacturer? Because he now has reasonable grounds to know that just one of his devices has been used to facilitate unauthorised reproduction, and because the very purpose (albeit legitimate purpose) of the device is circumvention, the device would be condemned by Article 13. The manufacturer would be forced to withdraw the device from the market (thereby losing all his investment in development of the device), and libraries will be left with no means to make lawful archival copies. In effect, the exception for library archiving will have been written out of the applicable copyright/author s right laws -- without any consideration ever having been given to whether such a change in existing law is appropriate.

A similar fate could befall a number of other copyright exceptions intended to fulfil the public interest. In particular, the adoption of Article 13 could lead to the effective elimination, without debate, of the following copyright exceptions found throughout Europe:

  • the interoperability provisions of the EC Software Directive; . exceptions permitting copying for personal use;
  • exceptions permitting copying for scientific use; and
  • exceptions for educational uses.

Given these serious and widespread concerns, Article 13 should be revisited, taking into consideration not only the legitimate concerns of content owners about piracy, but also the need to maintain an appropriate balance in the author s right/copyright regime and the impact this provision could have on innovation of a wide-range of products.


Their current formulation, the provisions of the Basic Proposal dealing with the Digital Agenda fail to take into account the basic reality of the digital world. The Basic Proposal therefore threatens OSPs with liability for every transmission, users with liability for every use, and consumer electronic, computer, and other device manufacturers with liability for producing legitimate and innovative new technologies. If the treaty language is not properly modified, this spectre of liability would dramatically limit investment in the information infrastructure and the development of new public services by libraries and distance-learning activities by educational institutions.

We are committed to working tirelessly with all of the industries and other stakeholders eager to bring the benefits of the Information Society to the world to reach a consensus on these issues by the Diplomatic Conference scheduled for December. We would ask your assistance in achieving an appropriately balanced compromise on the controversial proposals for the Digital Agenda, so we can avoid the necessity of deferring action on the existing unripe proposals.


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