UPDATE 3-Canada to overhaul copyright laws for digital age

(Adds reaction, details on penalties)

OTTAWA, June 12 (Reuters) - Canadians will be allowed to copy legally acquired music to their iPods and computers but would be banned from getting around any digital locks that companies might apply, under new legislation introduced in Parliament on Thursday.

The bill, introduced by Industry Minister Jim Prentice, would also reduce the penalties that companies could seek for most private infringements of copyrights to a maximum total of C$500 ($490) from a previous C$20,000 per infringement.

Currently, for example, someone downloading five movies without authorization for private use could be sued for C$100,000, whereas now the maximum would be C$500 -- a level that would make firms unlikely to pursue such individuals.

“It’s not a fine. It’s actually a form of damages. In other words, it’s the rights holders that have to pursue. It’s not the state -- it’s not criminal,” a government official, who asked not to be identified, told reporters in a briefing.

Heavy, commercial levels of piracy, however, could face far more severe liabilities in corporate lawsuits and would also continue to be subject to government prosecution, with penalties of up to five years in prison.

The bill would still exempt Internet service providers from liability for copyright violations by their subscribers, and would require them only to pass on notices of violations rather than to take down offending material as required in the United States.

It would also allow consumers to record television and radio programs for playing back at a later time, a practice known as time-shifting, but would prohibit people from keeping them indefinitely in a personal library of recordings.

In drafting the legislation, the government said it faced the delicate task of balancing the rights of content creators with the realities and needs of everyday life in a digital world, and also realizing the difficulty of policing possible personal infringements.

Prentice said of the issue: “It touches each and every one of us, and it is no surprise to find so many different points of view with respect to copyright.”

One online group, Fair Copyright for Canada, was set up on Facebook in advance of the new bill to protest against the government’s copyright plans and has 40,000 members.

Its creator, University of Ottawa professor Michael Geist, focused on provisions under which it would be illegal to break digital locks.

“Prentice hands consumers a series of attention-grabbing new ‘private rights’ but then proceeds to take them away in the digital environment,” he wrote. “All these rights force consumers to read the fine print -- you can shift a song or a television show, but once it’s locked down, your rights disappear and your potential liability skyrockets.”

However, Canadian performers, publishers and the music industry said the new legislation would help protect their work and encourage investment.


Industry officials say their big concern is not individual private infringements but those who upload material to the Internet and make money off it.

“We’d only be concerned with the most egregious violators, people who try to make a business out of the trade and infringement of materials,” Duncan McKie, president of the Canadian Independent Record Production Association.

“We’re not that concerned about people in their basements sharing a few files here and there. Obviously to pursue those people would be very difficult and very expensive.”

Penalties of up to C$20,000 per infringement would however apply if digital locks were hacked, for example to make an unauthorized copy of a computer game.

These higher penalties would also still apply for posting music using the Internet or peer-to-peer technology, or for posting a copyright-protected work, such as a picture or video, onto a website such as Facebook or YouTube.

Under the bill, hacking for commercial purposes would now be subject to criminal prosecution by the government.

The bill would also make it illegal to provide, sell or import the hacking tools used to circumvent digital locks.

The main opposition Liberal Party slammed the legislation as a half-baked measure that neglected consulting all sides.

“How are you going to enforce this when existing jurisprudence doesn’t allow you to walk into someone’s home?” asked Liberal Dan McTeague.

$1=$1.02 Canadian Additional reporting by David Ljunggren and Louise Egan; editing by Rob Wilson