Final Draft of Brazilian Copyright Reform Bill Leaked by Forum Magazine

Renato Rovai, editor of Brazil’s Fórum magazine, has just posted the final draft of the Brazilian copyright reform bill on his blog. This and previous versions of the draft bill have circulated from hand to hand in the past few weeks, reaching a few members of civil society and journalists, but not the public at large. Along with the draft bill itself, Rovai has also published minister Ana de Hollanda’s message to president Dilma Rousseff containing the rationales for the proposal, and a lengthy technical brief prepared by the Ministry of Culture’s Intellectual Rights Directorship.

A Google translation of the rationales document can be read after the jump. It is a very rough translation, but good enough to get a taste of the proposal and feel concern about some of the arguments it presents. It is especially alarming that in item 3 of the document minister Ana de Hollanda incorrectly assumes that Brazil is not in compliance with TRIPS’ enforcement provisions…

Stay tuned for a substantial analysis of the final proposal and its previous versions.

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IN no. 000 / 2011 – MinC
Brasilia, October 2011.

Madam President,

1. I hereby submit for the consideration of Your Excellency the attached draft Bill proposing amendments to Law No. 9610 of 19 February 1998 amending, updating and consolidating the copyright act and other provisions.

2. This proposal stems from the fact that the law currently in force, although published in observance of the obligations deriving from the entrance of Brazil in the World Trade Organisation Trade Organization (WTO), and marked by the incipient rise of the Internet, is now the object of questions by interested segments of Brazilian society, who indicate the need to establish some form of control over the use of protected works as a result of the new standards brought by digital technology, as well as the existence of an imbalance between the rights conferred on authors and copyright holders, and the social right of access to cultural goods, demanding new legislation.

3. Indeed, the existing law proves an insufficient instrument to cope with constant demands in the international arena, requiring the presentation of evidence and data showing the positive role of the Brazilian state in the area of ​​copyright. Despite the increase of their weight in international trade negotiations, it appears that the reform introduced by Law 9.610/98, regarding the adequacy of the Brazilian legislation the provisions of the Agreement on Trade-Related Aspects of Intellectual Property Rights Related to Trade Organization World Trade (TRIPS), was lacking in one fundamental point: not providing conditions for the Brazilian State comply with policies relating to copyright, even those that concern relationships between private entities.

4. Along these lines, any flaws in the system of collective management in Brazil, for example in collection and transfer of rights in the exploitation of works of foreign authors in Brazil, may lead the country to have its trade policies questioned, and even commercial retaliation. Therefore it is imperative to overcome this state of institutional vacuum, providing the government administrative oversight mechanisms in this endeavor.

5. The current Law No. 9.610/98, by extinguishing the National Copyright Council, CNDA, a collegiate providing consulting, assistance and supervision in the field, created by the repealed Law No. 5988 of 14 December 1973 and deactivated in 1990, curtailed the supervision and regulation of collective management by the executive branch. Since then, the absence of state executive action has fostered asymmetric relationships in the exercise of this private right, which suffers from gaps in the economic regulation required by art. 174 of the Constitution.

6. This circumstance has the consequence of fostering litigation, very evident in the collective administration of music copyrights, costly for the parties involved and the Judiciary. Such questions could be avoided by means of adequate administrative regulation, which would provide mediation and stimulate arbitration in such disputes.

7. Beyond the economic issues of copyright, its social dimension in the Constitution Brazil, together with the inclusion of copyright protection as a fundamental right in art. 5, paragraph XXVII, paragraph XIV of the same article establishes the right to access information; art. 6 and art. 205 establish the right to education and art. 215 establishes access to culture.

8. Nonetheless, Law No. 9.610/98 presents obstacles to the exercise of these rights, shown in impossibility of carrying out a full copy of the private work without permission, banning the reproduction of works aimed at preservation restoration, and reproduction of works aimed at the physically handicapped, or even, in some cases, the use of works for educational activities.

9. The current rules make illegal acts such as the ordinary recording a movie shown in TV or open private copying to a computer or portable device, of a CD legally purchased by the owner, for the law always imposes the necessity of obtaining permission prior rights of holders of those works.

10. Given this situation, the Ministry of Culture opened consultations through the National Forum Copyright, promoted from December 2007 to November 2009, and from the demands and problems faced by different stakeholders in the various seminars that took place in this Forum, compiled and systematized the main issues that were identified, noting the obvious way need for legislative review. It was found that a review of the most problematic aspects of the law would be more appropriate than creating an entirely new law.

11. Thus, it was decided that the changes demanded deeper structural changes in the body of the Law 9610/98, and a draft law was prepared, subjected to extensive public consultation over the Internet between July and August 2010, and sent at the end of that year the Civil House of the Presidency of the Republic. In the face of new presidential term, the bill returned to this ministry in early January 2011, and in this opportunity another period of consultations was opened, to the improvement of the final legal text.

12. Seeking the balance of relations established on the grounds of intellectual creation, the amendments fall into three main groups: a) correcting misconceptions and technically improving some provisions, which gave room to uncertainty regarding their interpretation; b) including of new articles on issues where the law was silent (as in the case of works for hire, the treatment of orphan works, the role of the executive branch in supervision and regulation) or which were dealt with insufficiently or lacked balance (such as transfers of rights and limitations); c) implementation of the contemporary legislative techniques enshrined in the Constitution, some specific statutes and the Civil Code, which make use of general principles and provisions, and open normative standards, thus harmonizing copyright law with the rest of Brazilian law, while preventing its precocious anachronism.

13. The initial part of the bill includes goals and principles that reconcile the protection the author’s constitutional rights to cultural diversity and other fundamental and social rights mentioned by the Constitution.

14. Propose some corrections in the legal definitions, in order to harmonize Brazilian copyright law withcurrent terms in the global context. Most notable are new wordings to the concepts of “audiovisual work” and “distribution”, and the inclusion of the definition of “performers”, and the concept of “traditional cultural expressions”, instead of “folklore.”

15. The concept of “phonogram,” is also changed, with the suppression of a final expression improperly reproduced from an international treaty to which Brazil is signatory, which, taken out from its context, allows interpretations detrimental to musical composers of audiovisual works. Also changed is the concept of “broadcasting”, also placed in an international treaty but not applicable to Brazilian reality. Finally, the concepts of “licensing” and “transfer” are given greater clarity, as legal instruments available to the authors for the granting of permission for the use of works.

16. With regard to the authorship of the works, the text explains that musical arrangements are works protected as stated in the Berne Convention, of which Brazil is a party. It also adopts the terminology “Visual arts”, replacing “plastic arts”, more suited to new forms of artistic creation contemporary. Likewise, it is clear that the technical standards themselves, as well as instructions and information about chemical composition and package inserts of drugs for guidance of patients are not protected as intellectual property. Another major change is clarification of the condition of the writers authors of audiovisual works, along with the directors, authors of literary, and the authors of the musical composition or literary-musical especially composed for the audiovisual work. And it explained the author’s right to use collective works separately their individual contribution.

17. The concept of work available for people with disabilities is established, and the prediction of clause specified in the publishing contract that provides for the possibility of its production or not the parties involved in order to give visibility to the specific demands of these citizens, having been preserved without restrictions the full disposition of the will of the contracting parties regarding the matter.

18. The registration service for public works and phonograms presents an important and innovative structure with the unification of its computerized database, to be administered by the Ministry of Culture, which will bring together all the relevant data and to make possible the effective protection of works and Phonograms Treaty and the identification of its public domain, for the purpose of free access, use and exploitation, even economically, without the restrictions imposed by copyright. Moreover, it will online services and Internet management and sharing of this information combined with public agencies and civil society actors concerned, licensing of works in digital media and providing the required data elements and the development of indices and indicators of production national culture.

19. The preservation and access to rare books, object, item VII of art. 24, is also entitled to be transmitted to the successors of the authors extended the same option with the most comprehensive character Ministry of Culture, under Article 20-C, § 1. With regard to the audiovisual work, exercise of moral rights is no longer the exclusive prerogative of the director, can the other co-authors to exercise them on their individual contributions, as indicated.

20. In the field of property rights, improved the definition is the act of the interactive access digital environment (the “making available to the public”), which has many interpretations occasioning Current Law wrong. It also suppressed the legal gap regarding the term of protection of the work conference. The right to receive 3% (three percent) in respect of the resale right is to be incident verifiable on the price (and not about the price increase) in each resale of a work of art. Becomes explicit regional exhaustion (within the member countries of the World Trade) of property law distribution with the first sale, except for the rental works audiovisual and computer programs. It promotes, also the adequacy of the legal text to the logic of Civil Code of 2002 with respect to non-reporting of income from rights equity (comparable those from the work of author-spouse) in the system of community immovable, for the purpose of marriage and stable relationships.

21. The chapter “Limitations on Copyright” has been expanded. to authorize the owners of legally acquired works to make a full copy of it, as well as the possibility of its implementation in various media and formats, its use in educational practices and research, unrestricted access by people with disabilities, the reproduction of works for conservation and preservation by libraries, museums and similar entities, and allow its use in religious ceremonies and for therapeutic purposes by health institutions non-profit.

22. As long as specific requirements for each case are met, the text allows the communication to the public of works in the family circle and film clubs, schools, units in hospitals and clinics or religious temples, always to the extent justified for legitimate purposes and without purpose of profit. Included were still necessary limitations on the movement of works in the environment everyday life, focusing, for example, to use appropriate and timely protected in those portfolios professionals and dissemination by museums.

23. The limitations contained in the act can cover situations similar to those provided for in sections Article 46, since the recognition of the limitations of copyright, not expressly provided for these regulations, comply with the requirements of international legislation to stipulation limitations, now scrutinized in sections of § 3 of that article, that match-touted rule three steps of the Berne Convention.

24. The all-new Chapter VI “OF WORKS CREATED IN THE CONTEXT OF LABOR AND EMPLOYMENT” is proposed in order to fill the gap that regulation in our legal system, ensures the employer to an exclusive license to use works created in strict compliance with the purposes and responsibilities arising from contract or statutory relationship. However, it limits the employer’s property right to the work within ten years, from the date of first use of the work by the employer or, failing that, the date of completion, providing greater legal certainty for participants in the employment relationship. Excepcionamse, still in favor of the creator of the work the protections provided for in special legislation in force, expressly referenced in this chapter, bearing in mind its impact, including the cases of works produced for education and research.

25. The provisions relating to the social contract and principles of good faith of the Civil Code force were migrated to the text of this special law and adapted to the reality under contract for balancing effect between the parties.

26. Assumptions as of proven neglect of the use and exploitation of the work, or from excessive injury, characterized as a person, under urgent necessity, or inexperience, if requires the provision manifestly disproportionate and, finally, in the event of burden, in which case the work achieves unexpected increase in their economic exploitation, rather than pay initial author, are expressly accepted in writing of the Article 6-A.

27. The publication of works contract, provided for and governed in its general form in Title IV, can not management and promoting economic exploitation of the work will disengage from the author. He also leaves to be instrument capable of the assignment of copyright, which should be promoted through stand-alone instrument. The works such as translations, illustrations and photographs may also be subject to publishing contracts.

28. The communication to the public of the work provided for in Article 68, shall also cover the display public of the audiovisual work, benefiting from this type of use and its creators, including the producers. Nonetheless the author’s permission and performers of copyrighted works for the production audiovisual in general, and in the absence of contractual caveat, transfer to the producer all audiovisual property rights inherent in their ordinary operation, the text of the law makes express reservation to those arising from each public display of an audiovisual work produced by bringing them safely this general rule. For the inspection and collection of this right of public communication created the unified collective management for the particular segment of the audiovisual, where all the bodies involved should meet to creation of a collector entity (association of associations) or delegate this activity to one of them Joint collection and distribution of copyright.

29. Was instituted Chapter VII only to regulate the use of “orphan works” that include those whose authorship can not be identified or located the author, and the statement must be requested by the applicant to the Ministry of Culture, also responsible for setting the remuneration for its use, through licensing aviado.

30. Welcomes solution to the problem of so-called copies “Xerox” in universities, creating a specific regulation for reprographic rights, with economic benefits for authors and editors means of collective management of reprographic rights.

31. Principles are established for the activity of collective management of copyright in the country, order to print an ethical administration, equitable, transparent, independent and efficient access to various segments of the intellectual creation, based on comprehensive and timely publicity of all acts of life institutions, especially in relation to its system of collection and distribution of amounts collected.

32. The practice of the collection and distribution of copyright, safeguarding all preexisting conditions, will only be legitimate for the civic associations that achieve specific record the Ministry of Culture.

33. Supervision of state economic activity, beginning with the record of civil association to the Ministry of Culture, will require the association of collective administration of copyright that demonstrate its ability to representation and transparent and efficient administration of these rights, be measured primarily through its activity reports and annual accounting. The conduct of the entities that present themselves contrary to the principles and provisions of this law, disclosing their unsuitability for the administration of third party rights, culminating in the cancellation of its registration the administrative judiciary, in view of the express constitutional guarantee of Article XIX 5 of the Federal Constitution.

34. Ensured the effective participation, with a voice and vote, even though proportionally to all civil associations belonging to the segment of the audiovisual and music reproduction, which by law are linked to the unified system of collection and distribution, provided they are entitled by Ministry of Culture for the activity of collective management in accordance with Article 98-A.

35. Treatment was imposed isonomic to users of works that meet the same conditions of fact, avoid the creation of collection or exemption from copyright overpayments for those explores the work of the same size and economic repercussions.

36. The Ministry of Culture is replaced by the ability to act in conflict resolution, providing administrative bodies of mediation whenever demanded by the parties voluntarily.

37. It is expressly recognized the possibility of the judiciary equitably adjust the civil penalties, depending on the circumstances of the case, in line with trends contemporary civil law. In the same way, we incorporate the understanding based on case law about the value of the fine applicable for public communication of the work done in violation of the law, which should be proportional to the damage generated, however subject to the damages which are not compensated for its application.

38. With regard to devices for the management of rights, remain the penalties in copyright law in force, setting, however, punishment for those who in any way hinder uses permitted in Article 46.

39. Finally, it creates penalties for those who provide or receive advantage to increase artificially the public performance of works or phonograms (the famous “payola”).

40. As regards the use in digital media, content protected by law without proper permission of copyright holders, an extra-judicial mechanism was adopted to enable removal of infringing content available on the Internet. This mechanism is the only option offered at the manifestations of society, and are presented in line with the aspiration of the actors involved in the area of ​​intellectual creation and production and regulation of the Internet as civil forwarded to Congress, which provides the possibility of a special law such as that scanned, to address specific issues.

41. As for the prescription, it seeks to remedy a gap derived from the Law No. 9610/98, establishing statute of limitations and how to count specific for copyright infringement.

42. The transitional provisions lend themselves to avoid legal uncertainty from the rule of law and states deadline for executive action of the public record of implementation of works and phonograms.

43. It is recognized that there are disputes and conflicts of interest involved in this project. but… sought to include in a balanced way the different demands and criticism, keeping consistency with the diagnosis emerged in greater National Copyright Forum, taking into account the importance this economic sector as a factor in national development, no failure to meet obligations assumed in the World Trade Organization.

44. It is essential to provide the State with a new role, most active in the institutions that make up the collective management of copyright. Imperative also building a new apparatus Legal values ​​that the author and thus encourage the production of new cultural goods, including perennial copyright policies of state, not just government.

45. Only in this perspective we envision as a goal for the coming years the culture as a driver of socio-economic development, with exponential impact on GDP and as important factor in reducing social inequality, strengthening the basic principles of democracy as social inclusion and strengthening of citizenship. These, Madam President, the reasons which lead me to submit to high consideration of Your Excellency, the attached proposed draft law

Respectfully,

ANNA MARIA Buarque de Hollanda Minister of State for Culture