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Tuesday, 7 December 2004
Page: 101

Senator RIDGEWAY (7:46 PM) —The incorporated speech read as follows—

I rise this evening to speak to the Copyright Legislation Amendment Bill 2004.

I would like to begin by saying that, in my view, we should not be dealing with this Bill today. This is an immensely complex Bill, which will have a major impact on Australian copyright industries. The Senate is being asked to enact this Bill without due consideration, without taking a thorough look at these provisions and working out what their impact will be. This is a house of scrutiny, and the opportunity for scrutiny is being denied.

The question of liability for Carriage Service Providers is the most talked-of example, but the fact remains that there are many other problems with this Bill as well. The Parliamentary Library Briefing—which was released only this morning—raises a number of other issues that need to be considered. Will the test for `temporary reproductions' cause confusion within Australian law? Will there be unintended consequences? Could the provisions with respect to the definition of `profit' be drafted more clearly? Why has the non-commercial end use of encoded broadcast not been included in this Bill, when it is clearly required by the FTA? These questions, and many more, need to be examined thoroughly by a Senate Committee.

Delaying this Bill will NOT invalidate the US Free Trade Agreement. The Agreement has been signed, the letters have been exchanged. The deal WILL come into force on 1 January irrespective of what is decided here today. No matter what our Minister has agreed to with the US behind closed doors, no matter what compromises have been made or concessions offered, this Parliament has a right to do its job properly.

The events of this week do not constitute the Senate doing its job properly. The Government released the text of the Bill only days ago, after what seems like only the most cursory of consultations with Industry. The Minister describes the Bill as making `minor and technical' amendments, a claim that is patently false. We then find out that the

Industry was consulted on a version of the Bill that didn't even include the most controversial provisions. They were sneaked in at the last moment. These are not the actions of a Government who has nothing to hide.

What has been promised to the US that we don't know about? I can only wonder.

Then the Senate refuses to exempt this highly technical, extremely complicated Bill from the cut-off. The Selection of Bills committee holds an extraordinary meeting to refer this Bill to a special committee—with a 24 hour reporting deadline. The Legal and Constitutional Affairs Legislation Committee met for two hours last night. Two hours! The provisions of the Bill are so complex that the first witnesses—who had only been allotted 25 minutes to give evidence—were kept before the Committee for a full hour. Even then, they were asked to provide substantial amounts of further evidence on notice. The same story followed for the second and third witnesses. By the time we got to the Attorney-General's Department and DFAT witnesses, only FIFTEEN minutes were available for questioning. Needless to say, the Committee did not get the answers it was looking for. In fact, I would go so far as to say that the hearing raised more questions than it answered.

The Committee doesn't even have time to issue a report. No, instead we are tabling the Hansard, as if that proves that there was a process of scrutiny undertaken at any point. What anyone who reads this Hansard will find is that last night's hearing was confusing and dealing with very complicated matters. Each Senator on that Committee, both Government and non-Government expressed their incredulity that the provisions of this Bill clearly go beyond the requirements of the Free Trade Agreement.

Why are we being asked to enact these shockingly onerous provisions,

when the FTA doesn't even ask us to? Why are we being asked to scuttle the internet industry in Australia, when we are not required to by the Agreement, and in fact, what we are proposing goes WAY beyond what the US has imposed in its own country!

This Bill is a mess. It needs to be thoroughly considered and debated, not rushed through this place in the final week of sitting. If the Government couldn't get its act together to draft these provisions before now, that is not the Senate's fault. We have to do our job properly, and it is for that reason that I will be proposing a second reading amendment that will refer this Bill to the Senate Legal and Constitutional Affairs Committee for a full and proper Inquiry after the second reading stage.

As we discussed in August, the IP chapter of the Agreement is the most significant—with the most far-reaching reforms which will have a direct and serious impact on Australian innovative industries. Some of these changes, such as the ratification of the WIPO treaty, are positive reforms. However, aspects of the chapter relating to extension of the copyright term, provisions relating to anti-circumvention devices, and liability of ISPs relating to copyright infringement are very dangerous developments.

We are changing the future of Australian copyright law through a trade agreement, rather than through thorough, reasoned, considered debate here in our own country about how we want our future media landscape to be structured. These changes are being implemented for strategic political and trade objectives, as items to be horse-traded in negotiations—a compromise here, a concession there—rather than with an eye to what is best for Australia. This is an unacceptable way to go about policy development. These commitments have been locked in, with no opportunity for the Australian people to have their own say.

The fact remains, however, that even IF we supported the USFTA, the specific provisions of this Bill are sufficiently controversial that the Bill should be opposed in its own right.

I want to spend a moment discussing the various sections of the Bill, and the potential problems that may arise. Then I will turn to the most controversial aspect of the Bill, and that is the provisions relating to Carriage Service Provider liability.

This Bill amends the wording of the general exception for the making of temporary reproductions. However, under these provisions, the protection from infringement would only apply to temporary reproductions made as a necessary part of a technical process of use. The problems with this test lies in the definition of the terms `temporary' and `necessary'—a matter I had intended to pursue further at the third reading stage, but given that this Bill now has Opposition support, we have made the judgement call that there will be no point us bringing up these very important matters.

The Bill also amends the criminal offence provisions of the Copyright Act, to do with making infringing copies of copyright material to obtain profit. It changes the test that is required to be met to prove that profit has been obtained. Rather than simply replacing one version of the test with the version mandated by the FTA, the Government is seeking to implement an `either/or' test, which may produce some unexpected results as courts try to grapple with the differences between the two elements.

The Bill also criminalises the showing of illegally obtained encoded broadcast material (such as subscription television or radio) for commercial advantage or profit. However, the Bill does not provide a criminal offence for the non-commercial (that is, personal) end-use of infringing broadcasts, which is clearly required by the Agreement. The United States' view that Australia has not complied with AUSFTA is almost certainly correct. While the Australian provisions fulfil this requirement for commercial purposes, the question of personal use has been ignored completely. Why the Government would deliberately choose to avoid implementing the FTA in this case is a mystery.

The USFTAI Act established a new regime for determining when Carriage Service Providers (businesses that provide internet or telecommunications services) might be liable for copyright infringements by users over the CSP's network or service. The effect of the existing CSP provisions is to create a `safe harbour' of conditions where a CSP can avoid liability if certain criteria are fulfilled or certain processes are followed. This Bill amends the USFTAI Act tests for `financial benefit' and `awareness' that determine whether a CSP has `safe harbour' protection.

The new provisions relate to `Category C and D' activities—which relate to hosting websites that may contain copyright infringing material, or linking to sites that contain copyright infringing material. While the Bill applies to all `carriage' service providers, Category C and D apply mainly to Internet Service Providers (ISPs).

The new aspects of the `financial benefit' test are problematic in themselves, but given that I only have a short time here today, I will defer further discussion of this matter.

I want to focus instead on the provisions of this Bill that establish that mere awareness of category `C' or `D' activities creates liability. These are the most controversial aspects of this Bill.

Under AUSFTA, the awareness test is linked to the process for notification of infringement. This process provides a system for copyright owners to send `take-down notices' informing ISPs of copyright infringements across their network. It also provides an opportunity for the alleged infringer to provide a counter-notice refuting the allegation. Different obligations arise for ISPs depending on the nature of the take-down notice and whether a counter-notice is received. Also, AUSFTA requires that monetary remedies be available against people providing false information in notices and counter-notices. In the original USFTAI Bill, this ground of liability was going to be established by regulation, together with the specifics of the `take down notice' system as it will operate in practice.

There were serious concerns about the potential effect of this system in the original USFTAI Act, although some players in the industry were content that the scheme provided for a fair balance of the rights and obligations of copyright owners, ISPs and copyright users.

However, this new Bill goes even further than the original Act, and upsets this balance. Under the new provisions, ISPs must take material down if they are aware that material is infringing, or if they are `aware of facts or circumstances that make it apparent the material is likely to be infringing'. This removes the copyright owner from the equation, and places the entire responsibility for enforcing the scheme onto ISPs. ISPs will be required to take action on even the slightest suspicion that a copyright infringement may have occurred.

ISPs will be responsible for making decisions on infringement or not—and their liability is at stake. The onus will be on the ISP to err on the side of extreme caution—taking all suspect material down to avoid liability from legal action by copyright owners. However, if they do take material down which is later proven not to have infringed copyright, the copyright user will be able to sue for damages.

We have not yet seen a copy of the proposed regulations that will provide the detail of how this scheme will operate in practice. The Senate is being asked to enact the punitive aspect of this test, but with no detail of any checks and balances that may be provided in the regulations. This is unacceptable—and yet another reason why consideration of this Bill should be delayed—we must see the proposed Regulations before this Bill can be passed.

In his second reading speech, the Minister claimed that industry had been consulted on this Bill, and were satisfied with its provisions. However, this has been shown to be false. Representatives of the internet Industry Association have publicly expressed their deep concern about this new test. While they were consulted on an earlier version of the Bill, these new provisions have been included in the final Bill without any consultation at all. The IIA are supported by the Australian Digital Alliance and the Australian Vice Chancellor's Committee in their opposition to these provisions.

So far, the Attorney-General and Trade Minister have not been forthcoming with convincing explanations as to why these provisions are necessary. They are not required by the AUSFTA, they go further than the USA's own system under the Digital Millennium Copyright Act, and will create major burdens on Australian ISPs.

This Bill is a mess. While parts of it may be interpreted as enacting the AUSFTA more effectively (not that this is a good thing!), other parts go far further than the FTA, and others still stop short of implementing the deal at all. We have no idea what has been agreed behind closed doors between Vaile and Zoellick, and whether compromises have been made in regard to the IP chapter of the Agreement to make up for concessions to do with pharmaceuticals. The Bill cannot be supported, and at the very least must be amended to overcome the more onerous aspects of its provisions.

As I discussed earlier, I firmly believe that we should not be dealing with this Bill at this time. I had intended to move a Second Reading Amendment to refer this Bill to a Committee for thorough consideration before the Senate is asked to deal with it any further. However, the Opposition has indicated that they will not support our proposed amendment, so we have elected not to move it. I must say, I am very disappointed with the Labor Party in this matter. Not content simply with letting the FTA through in August—albeit with token amendments that will achieve very little—they are now going to let through a bill that they actually KNOW will do significant harm. We had also prepared amendments that would have removed Items 11 and 13 from the Bill, which would have enabled us to still implement the terms of the FTA, but refrain from doing real damage to the Australian internet industry, but the Labor Party has rolled over.

Why are we even here for the next six months? It seems to me that the Government doesn't need to wait until July 2005 to gain control of the Senate—they already have it. The ALP is willing to let anything get through this place—even when they know full well that they are condemning sectors of Australian industry to ambiguity, confusion, and unquantifiable harm.

I would like to end by recording my apologies to the Industry representatives who worked so hard to bring us up to speed on this Bill so quickly—I thank them for their assistance, and express my regrets that we weren't able to achieve a better result.