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Canadian ISPs not liable for content royalties

Common carriers

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Internet Security Threat Report 2014

ISPs do not need to cough up royalties to copyright holders whose work is sent across the service providers' networks, the Canadian Supreme Court has ruled.

The verdict, backed unanimously, maintains that ISPs are "common carriers", which means that responsibility for the transmission of content lies solely with whoever sends it and whoever ultimately receives it, not the intermediary network.

That viewpoint had been challenged by the Society of Composers, Authors and Music Publishers of Canada (Socan), which believes that ISPs are effectively content-consumers, because the cache content that passes through their networks.

Socan has waged an eight-year battle to force ISPs to pay royalties. In 1996, it demanded that the Canadian Copyright Board (CCB), which oversees the country's copyright laws, imposes a 3.5 per cent-of-revenue levy on ISPs to compensate artists, authors and other copyright holders for the transmission of their works across the ISPs' networks.

Together, ISPs said such a levy would put many of them out of business for subscriber actions they could not - and should not - control.

Socan's move was made well before the debate over the illegal sharing of content across the Internet emerged in the early days of Napster.

Along with the Sodrac (the Society for Reproduction Rights of Authors, Composers and Publishers in Canada) and Sogedam, the Canadian performing rights society, Socan has lobbyed the CCB to impose a range of levies on a variety of products and providers to compensate artists for the effects of piracy. Black CD sales have yielded revenue this way for three years, and late last year the CCB imposed similar levies on MP3 player sales.

Interestingly, the Supreme Court of Canada ruling voids a Federal Court of Appeal judgement that ISPs can be deemed liable for copyright infringement by caching unauthorised content.

In March this year, the Federal Court rejected a demand from the Candian Recording Industry Association that ISPs should be forced to reveal the identites of subscribers alleged to have engaged in illegal file-sharing.

The judge turned the CRIA down because "no evidence was presented that the alleged infringers either distributed or authorised the reproduction of sound recordings. They merely placed personal copies into their shared directories which were accessible by other computer users via a P2P service".

The CRIA is to launch an appeal against that ruling. ®

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