There has been much talk in recent months about proposed changes to the Australian copyright system. The Australian Law Reform Commission and the Turnbull Government have been contemplating moving to a ‘fair use’ system like the United States to promote greater innovation at home. But what does this actually mean and will a ‘fair use’ system really encourage innovation in our society?

So, What Exactly is Fair Use?

Fair use states that copyright is not infringed if work is reproduced for criticism, comment, news reporting, teaching, scholarship or research (s 107 of Title 17 of the United States Code). When deciding whether the purpose is a ‘fair use,’ factors to consider include the following:

  • Whether or not the use is for a commercial purpose;
  • The nature of the work itself;
  • The amount of the work used; and
  • The effect of the use upon the value of the work.

It is typically seen as a somewhat loose copyright protection allowing others to use work within reason when it does not negatively affect the original, and allowing for a new ‘transformative’ approach to the work. Fair use encourages innovation by not placing too large a burden on people who wish to use or are inspired by others’ works and want to share or create something from it.

The stated purposes are also illustrative, meaning that fair use can apply to other purposes, not merely the ones listed in the legislation (as indicated by the words such as when describing the allowed purposes).

In Australia, ‘fair dealing’ similarly applies except it has prescribed purposes meaning only those listed are exceptions to copyright infringement. As such, there is a much narrower scope than ‘fair use’ in the United States, and so significantly limiting the ability of users to copy or distribute the material. 

Proposed Reforms

The Australian Law Reform Commission (ALRC) proposed reforming the Copyright Act to allow for innovation and reducing the unnecessary restrictions of these prescribed purposes. The report, published in 2014, addressed copyright issues in the digital era, however, gained little traction until late last year with the government’s Copyright Amendment (Disability Access and Other Measures) Bill 2016 (Cth). This Bill was introduced to allow libraries and educational institutions the ability to access more easily copyrighted material, particularly in regards to licensing, preservation copies, unpublished works and ‘safe harbour’ protections.

It’s also designed to facilitate greater access for people with a disability who require materials in specific digital formats to use and understand for research and education purposes. Clearly these reforms will be of enormous public benefit to institutions and disability groups. However, they still do not address the wider agenda of reforming copyright to allow for greater innovation, as the ALRC recommended.

Some people argue that the proposed reforms would hinder, rather than support innovation. Critics of the approach have said that there is no clear economic advantage to ‘fair use’ in Australia and if anything, it will reduce the desire for individuals to create original works if they are not afforded the same protections as they are currently. The Abbott government was particularly conscious of this and welcomed stricter measures for Internet site-blocking, copyright fines and the intellectual property protections in the Trans-Pacific Partnership (TPP). Australia’s responsibilities under the TPP may affect our ability to enact domestic reform due to the intellectual property obligations Australia now owes the other 11 countries who have signed on.

Where to Next?

The Productivity Commission is currently reviewing intellectual property in Australia, including the issue of ‘fair use’ to determine the economic consequences of moving to this type of copyright system. It is due to report its findings in April, which will determine the next phase in the reform process. Whether these reforms will benefit the Government’s innovation agenda or whether this is something that will be relegated to the backburner is yet to be seen.

What do you think? Tag us on Twitter @legalvision_au and let us know or get in touch with our intellectual property lawyers.

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