The Copyright (Amendment) Act

Digital appropriation may infringe copyright if it is found that either the whole or a substantial part of an original copyright work has been used or reproduced unless it comes under the shelter of any of the statutory exceptions under the CA 1987. However, in some instances of digital appropriation which do not tantamount to mere copyright piracy, difficulties may arise in determining whether the exceptions apply.

98 _{Supra n 92.}

99 _{Supra n 91.}

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Prior to the Copyright (Amendment) Act 2012,100 section 13(2) of the CA 1987 implemented a closed system of exceptions under which an act is not an infringement of copyright if it falls within any of the situations specifically listed and provided therein. Any act which does not come within the ambit of any of the exceptions will be deemed copyright infringement provided all elements of copyright infringement are satisfied. Prior to the amendment, each exception as provided in section 13(2) is tied to a particular purpose and certain requirements; for instance, an act done for the purpose of private study must also be conducted in a fair manner and accompanied by a proper acknowledgement.101 This means a ‘fair’ conduct may nonetheless be expelled from the closed system of statutory exceptions if it does not meet any of the requirements imposed for the relevant exception.

The Copyright (Amendment) Act 2012 introduced several amendments of pertinence to the fair dealing exception as provided in section 13(2)(a) of the CA 1987. One of them is the insertion of the word ‘including’ before the phrase ‘for purposes of research,102 _{private study, criticism, review}

or the reporting of news103 or current events’ in the sub-section.104 Besides, a new subsection (2A),105 _{which is basically modelled on section 107 of the 17 USC, has also been incorporated into}

100 _{Act A1420 which was gazetted on February 9, 2012 and came into force on March 1, 2012 via the notification PU(B) 58 of 22/2/2012.} 101 _{See section 13(2)(a) of the CA 1987.}

102 _{Prior to the Copyright (Amendment) Act 2012, section 13(2)(a) provided for the fair dealing for purposes of ‘non-profit research’. A person} who was engaged in a research for commercial profits may thus be unable to qualify for the exception under the then law. With the removal of the phrase ‘non-profit’ section 13(2)(a) is now available to anyone who conducts a research, whether for profit or not, provided all other requirements are satisfied. This will place the position in Malaysia similar to that in Canada in which section 29 of the Canadian Copyright Act provides, ‘Fair dealing for the purpose of research or private study does not infringe copyright.’ The Canadian Supreme Court in CCH

Canadian Ltd v Law Society of Upper Canada 2004 SCC 13; [2004] 1 SCR 339 held that ‘research’ must be interpreted liberally in order to

ensure that users’ rights are not unduly constrained and research is not limited to non-commercial or private contexts (at para 51). 103 _{The Copyright (Amendment) Act 2012 included ‘news’ as the subject matter of reporting, in addition to ‘current events’.}

104 _{The Copyright (Amendment) Act 2012 has also amended section 13(2)(a) by making an acknowledgement of the title of the work and its} authorship compulsory regardless of whether or not the use is public. The law before the amendment required an acknowledgement only if the use is public. The previous exception to the requirement of a proper acknowledgement has also been restricted by the Copyright (Amendment) Act 2012 by making the exception available only in cases where the reporting of news or current events by means of sound recording, film or broadcast is involved. Previously, the exception was applicable to the doing of any act ‘for the purposes of non-profit research, private study and the reporting current events by means of a sound recording, film or broadcast.’

105 _{The Copyright (Amendment) Act 2012 inserted into section 13 this new sub-section which reads, ‘For the purposes of paragraph (2)(a), in} determining whether a dealing constitutes a fair dealing, the factors to be considered shall include – (a) the purpose and character of the dealing, including whether such dealing is of a commercial nature or is for non-profit educational purposes; (b) the nature of the copyright work; (c) the amount and substantiality of the portion used in relation to the copyright work as a whole; and (d) the effect of the dealing upon the potential market for or value of the copyright work.’

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section 13 of the CA 1987. The new subsection (2A) lists four factors among the matters to be taken into account in determining whether a use or dealing is fair.106

The scope of section 13(2)(a) of the CA 1987, as it was before the Copyright (Amendment) Act 2012, was considered by the High Court in MediaCorp News Pte Ltd & Ors v MediaBanc (JB)

Sdn Bhd & Ors.107 Nalini Pahmanathan J observed that,

‘The section is drafted so as to specify with particularity the only circumstances or occasions of use which would qualify for exemption, namely non-profit research, private study, criticism, review or the reporting of current events. The section does not provide for a broad and unspecified category of acts of “fair dealing” or use, of which the circumstances of non-profit research, private study, criticism, review or the reporting of current events provide some specific examples. This is evident from the fact that the words “fair dealing” are immediately qualified by the words “for the purposes of” and followed by the specific events or circumstances in which copyright control is precluded.’108

The High Court in MediaCorp News Pte Ltd & Ors compared the fair dealing exception before the 2012 amendment to the 17 USC and noted that the various purposes set out under the latter ‘are referred to as examples of fair use but do not serve to provide the defining limits for “fair dealing”, unlike the Act in Malaysia. To that extent the definition of “fair dealing” in that jurisdiction is

106 _{The four factors are not exhaustive in view of the word ‘include’ as found in the new subsection (2A) of the CA 1987, which is similar to that} under section 107 of the 17 USC. As the US Supreme Court observed in Sony v Universal City Studios, Inc. 464 US 417 at p. 476, “No particular weight, however, was assigned to any of these [the factors listed in s 107 of the 17 USC], and the list was not intended to be exclusive.’ 107 _{[2010] 5 MLJ 562.}

108 _{In Pro Sieben Media AG v Carlton UK Television Ltd [1998] FSR 43 Laddie J stated that the fair dealing provisions of the UK Copyright,} Designs and Patents Act 1988 “....are not to be regarded as mere examples of a general wide discretion vested in the courts to refuse to enforce copyright where they believe such refusal to be fair and reasonable”. See also Beloff v Pressdram Ltd & Anor [1973] 1 AER 241 in which Ungoed Thomas J observed that the defence of fair dealing in section 6 of the previous UK Copyright Act 1956 was ‘directed to and consequently limited to and be judged in relation to the approved purposes. It is dealing which is fair for the approved purposes and not dealing which might be fair for some other purpose or fair in general.’ Relying on the two authorities, the High Court of Malaysia in MediaCorp News

Pte Ltd stated that, ‘It is therefore clear that under the Act [before the Copyright (Amendment) Act 2012] fair dealing is qualified by the purpose

for which such dealing is done, namely non-profit research, private study, criticism, review or the reporting of current events.’ (at para 206).

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considerably wider than in Malaysia under the Act.’109 _{The court then concluded that the CA 1987}

did not allow for fair dealing to be assessed by considering a broad category of circumstances and ascertaining whether those circumstances conform to a set of statutory guidelines. On the contrary, fair dealing under the CA 1987 was confined to ‘fair dealing’ for the prescribed purposes set out in section 13(2)(a) and no more.110

The Copyright (Amendment) Act 2012 has converted section 13(2)(a) into a provision akin to that of the 17 USC. This is strengthened by the introduction of the new subsection (2A), which is worded in very similar terms as section 107 of the 17 USC, providing four factors that will guide a court in determining whether an act is fair. Section 107 of the 17 USC, before listing the four factors, provides that ‘Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright.’111 _{In view of the closely resembling provisions of the 17 USC and the CA 1987, it may}

be argued that the insertion of the word ‘including’ before the prescribed purposes has opened up the initially closed system of fair dealings in Malaysia since the word ‘including’ should mean that the purposes of research, private study, criticism, review or the reporting of news or current events are merely some examples of the purposes which are deemed ‘fair’.

Nonetheless, it remains to be seen as to how broad the ambit of section 13(2)(a) is and, clearly, this would depend on the approach which the courts will employ in construing the section. The insertion of the word ‘including’ into section 13(2)(a) may also be interpreted in an alternative

109 _{Supra n 107 at para 211.}

110 _{Id at para 213. Nalini Pahmanathan J described the fair dealing in the then section 13(2)(a) as ‘a fairly narrow exception to the prohibition} against the infringement of copyright’ (at para 211).

111 _{Section 106 of the 17 USC provides for copyright owners’ exclusive rights while section 106A provides for authors’ moral rights.}

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way. Applying the ejusdem generis rule,112 any purpose of a fair dealing in section 13(2)(a) should be of the same general nature or kind of the specified purposes. In other words, a fair dealing should have a purpose similar in nature to ‘research, private study, criticism, review or the reporting of news or current events’ if a restrictive approach is adopted in construing section 13(2)(a). Even if a court elects to apply a restrictive approach to interpret section 13(2)(a), the scope of the section has undoubtedly been widened by the Copyright (Amendment) Act 2012 as the purpose of a defendant in the doing of a claimed fair dealing is no longer confined to research, private study, criticism, review or the reporting of news or current events.

2.4.2 Digital Sampling

As argued earlier, digital sampling should be excused under the de minimis rule in view of the relatively small portion being used as compared to the original sound recording or the underlying musical work. However, if the portion taken by a sampler is found by the court to be ‘substantial’, that sampling will constitute copyright infringement unless it falls within any of the statutory exceptions under section 13(2) of the CA 1987. A possible exception to be considered is the fair dealing exception in section 13(2)(a) of the CA 1987.113

If a restrictive approach is adopted in interpreting section 13(2)(a), the application of the sub- section to digital sampling may be fraught with difficulties. Applying the ejusdem generis rule, digital sampling may appear to be of a different nature or class as compared to the specified

112 _{The ejusdem generis rule means that ‘where general words follow an enumeration of persons or things, by words of a particular and specific} meaning, such general words are not to be construed in their widest extent, but are to be held as applying only to persons or things of the same general kind of class as those specifically mentioned.’ See ‘Ejusdem generis’, Black’s Law Dictionary Free Online Legal Dictionary 2nd Ed., 19 November 2015 http://thelawdictionary.org/ejusdem-generis/.

113 _{Depending on the facts and circumstances of each case, other exceptions may also be applicable such as if the act is by way of parody under} section 13(2)(b) or the inclusion of a work where the inclusion is by way of illustration for teaching purposes under section 13(2)(f). However, it should be noted that digital sampling may not constitute parody or be performed for teaching purposes in every case.

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purposes, namely, research, private study, criticism, review or the reporting of news or current events which apparently tilt in favour of the interests of learning and public access to information. In contrast, the main interest served by digital sampling is freedom of expression and creativity. Arguably, digital sampling does not belong to the same general kind or class as that of the specified purposes in section 13(2)(a). It follows therefore digital sampling may not qualify as a fair dealing in the context of section 13(2)(a) at all if a restrictive interpretiation of the sub-section is adopted .

On the other hand, if a liberal approach is adopted in construing section 13(2)(a), it may be argued that the insertion of ‘including’ has the effect of rendering the fair dealing exception in section 13(2)(a) no longer limited to the specified purposes. Accordingly, it may be argued that since digital sampling encourages freedom of creativity and promotes the production of more works it is in the public interest to regard it as a fair dealing. A reference may be made to the Canadian Supreme Court’s liberal approach in construing the listed purposes of fair dealing in CCH

Canadian Ltd v Law Society of Upper Canada114 in which it was stated that the purposes ‘should

not be given restrictive interpretation’ as to avoid undue restriction on users’ rights.115 _The

Canadian Supreme Court was more concerned with the ‘real purpose or motive in using the copyrighted work’.116

Assuming digital sampling is accepted as a permitted purpose for the exception in section 13(2)(a) there are still a number of factors to be considered in determining the ‘fairness’ of this practice, including the purpose and character of the dealing as provided in section 13(2A)(a). As was held by the US Supreme Court in Campbell v Acuff-Rose Music, Inc.,117 in considering the purpose and

114 _{2004 SCC 13; [2004] 1 SCR 339.} 115 _{Ibid at para 54.} 116 _Ibid. 117 _{510 U.S. 569 (1994).}

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character of the use, the examination should concentrate on ‘whether the new work merely supersedes the objects of the original creation, or whether and to what extent it is “transformative”, altering the original with new expression, meaning, or message.’118 _{Digital sampling, by its nature,}

does not merely supersede the objects of the original sound recordings or musical works. It is a practice whereby brief segments are sampled from different sound recordings and altered or manipulated so as to produce a remix which is always significantly distinguishable from the original sound recordings or musical works. It does result in the creation of a new sound recording which may sufficiently illustrate the requisite level of transformative-ness.

The factor in section 13(2A)(a) also includes the consideration of ‘whether such dealing is of a commercial nature or is for non-profit educational purposes’, which may operate against a digital sampler as most of the samplings are used in commercial settings.119 Nonetheless, the US Supreme Court in Campbell v Acuff-Rose Music, Inc.120 found the Court of Appeals for the Sixth Circuit had erred in holding that every commercial use of copyright work is presumptively unfair.121 As expressed by the US Supreme Court, ‘The more transformative the new work, the less will be the significance of other factors, like commercialism, that may weight against a fair use.’122 _This

clearly shows that a commercial use of pre-existing copyright works should not in itself preclude such act from the shelter of fair use.In fact, the consideration of commerciality does not help much since, as rightly found by the court in Infinity Broad. Corp. v Kirkwood, ‘most secondary uses of copyrighted material… are commercial.’123 _{As applied to digital sampling which demonstrates a}

high degree of transformative, it is submitted that commerciality of use should be of little bearing.

118 _{Ibid at 579.}

119 _{In the circumstances where a person samples for non-commercial purposes such as for private or domestic use, this factor should not operate} against the digital sampler.

120 _{Supra n 117.}

121 _{It was held that the appellant’s song ‘Pretty Woman’ was a parody that made fair use of the respondent’s ‘Oh Pretty Woman’.} 122 _{Supra n 117 at 579.}

123 _{150 F.3d 104 (2d Cir. 1998) at 109.}

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The other factor to be considered is the nature of the copyright works in question as provided in section 13(2A)(b) of the CA 1987. It is the general rule that copyright law tolerates a use made of factual works more than that of creative works. This is likely to weigh against digital samplers in view of the fact that the underlying musical works and sound recordings are creative works. However, this is not conclusive as demonstrated in Campbell v Acuff-Rose Music, Inc.124 where a parody was held to qualify as a fair use despite the fact that the original copyright work involved was a musical work, which was a creative work.

Section 13(2A)(c) of the CA 1987 also requires the amount and substantiality of the portion used to be considered in relation to the copyright work as a whole. This factor should favour digital samplers since the portion used is usually minimal. As Somoano observed, ‘it would be difficult to ever conclude that such a minimal taking also constituted the “heart of the original work”’.125 Lastly, section 13(2A)(d) requires ‘the effect of the dealing upon the potential market for or value of the copyright work’ to be taken into account. The factor will favour the digital sampler if the work he produces does not compete or interfere with the sale of the original copyright work. Somoano was of the view that ‘Where the two works are from different genres, this factor should weigh in favour of the defendant, as the new work will probably not impact the market for the original if the audiences for each genre do not overlap.’126 _{However, as was held in Campbell v}

Acuff-Rose Music, Inc.,127 markets to be considered could be those in existence as well as the prospective ones either for the original or derivative works that the copyright owners might

124 _{Supra n 117 at 586-587.} 125 _{Supra n 59 at 307.} 126 _Ibid. 127 _{Supra n 117 at 591.}

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develop or authorize others to develop. Original copyright owners may thus claim that they should enjoy the rights to withhold or grant licences to sample their works.

It should be borne in mind that the resulting digital samples typically do not and are not intended to replace the original copyright works. An analogy may be drawn with the case of Kelly v Arriba

Soft Corp.128 in which the US Court of Appeals for the Ninth Circuit found that the lower resolution thumbnail images did not infringe the copyright owner’s potential to license its images since the original images in high quality format could only be obtained from the copyright owner. The same may be said in respect of digital sampling which will not replace the original copyright works and the latter, in full, may be obtained only from the copyright owners.

Considered as a whole, digital sampling is likely to be regarded as ‘fair’ under section 13(2)(a) of the CA 1987. The real problem may, however, lie in the scope of the permitted purposes as discussed earlier.

2.4.3 Google Books

In contrast to the digital sampling scenario discussed above, it is arguably less problematic for Google Books to fall within the permitted purposes under the current section 13(2)(a) of the CA 1987. Even if the ejusdem generis rule is adopted in interpreting the scope of the permitted purposes, Google Books may still fall within the same general kind or class as ‘research, private