Government skips geoblocking and fair use in copyright reform

The government said it will review at a later stage whether to add the circumvention of geoblocking technology, fair use exceptions, and an expansion of the safe harbour scheme to copyright reforms.

The Australian government has finally tabled its response to the Productivity Commission's report into intellectual property, but did not lend its full support to the recommendations on circumventing geoblocking technology, implementing a fair use exception for copyright infringement, and expanding the safe harbour scheme.

The Australian Government Response to the Productivity Commission Inquiry into Intellectual Property Arrangements: August 2017 [PDF], published on Friday afternoon, merely "noted" the recommendation that it amend the Copyright Act to make clear it is not a copyright infringement for consumers to circumvent geoblocking technology, and that it avoid entering international agreements banning consumers from doing so.

"The government supports the ability for Australian consumers to affordably access copyright content in a timely manner, noting that this is a key factor in preventing copyright infringement," the response said, adding that the government will review whether exceptions should be created for some uses of copyright material currently prevented by geoblocking.

"However, the government notes that other measures, such as terms and conditions under consumer contracts and/or regulatory arrangements in jurisdictions outside Australia would continue to govern the circumvention of geoblocking technology.

"The government has robust arrangements in place to ensure that domestic policies are considered in international agreement negotiations and implementation."

It also merely took note of the recommendation that it implement a fair use exception, calling the issue "complex" and saying that it will consult publicly on increasing the flexibility of copyright exceptions at the beginning of next year.

"The government's aim is to create a modernised copyright exceptions framework that keeps pace with technological advances and is flexible to adapt to future changes," it said.

"There are arguments that Australia's current exceptions for fair dealing are restrictive when compared with international counterparts and may not permit some reasonable fair uses of copyright material ... there are different approaches available to address it."

The government then supported "in principle" various recommendations, including that it should expand the safe harbour scheme to cover all providers of online services, including cloud computing services, search engines, and online bulletin boards, rather than just carriage service providers.

"The government recognises the limitations of the safe harbour scheme being restricted to only carriage service providers. The government is undertaking additional consultation on the safe harbour scheme before considering whether to introduce amendments to the Parliament," the response said.

"This additional consultation will ensure our safe harbour scheme will encourage growth in Australia's digital economy and ensure a thriving and vibrant creative sector, whilst respecting the interests of copyright holders."

It also supported in principle that it make unenforceable any agreements restricting or preventing a use of copyright material permitted by a copyright exception; or permit consumers to circumvent "technological protection measures".

"A move to restrict contracting out of exceptions is likely to have little effect if technological protection measures (TPMs) are unilaterally used to override exceptions," it said.

The government will thus review whether new TPM exceptions should be created for certain "legitimate" uses of copyright material during the second half of 2017, and will then consult on how best to implement the first half of this recommendation.

Communications Minister Mitch Fifield said the reform is part of moving intellectual property arrangements into the 21st century's digital economy, saying the government will now consult with industry on how to implement the accepted recommendations.

Some of the recommendations supported by the government included that IP Australia should reform its patent filing processes to require applicants to identify the technical features of the invention in the set of claims; that it abolish the innovation patent system; and that it implement an open-access policy for publicly funded research.

The Productivity Commission had in December recommended that the government abolish the innovation patent system and apply safe harbour provisions to all online service providers.

"Online service providers, such as cloud computing firms, would face fewer impediments to establish operations in Australia," the commission said last year.

"The copyright system will be more adaptable as new services and technologies are developed, facilitating greater innovation. Aligning with international systems further reduces business uncertainty."

This followed the commission's draft report in April 2016 saying that circumventing geoblocking is not copyright infringement.

In regards to allowing the circumvention of geoblocking, the commission had said it would provide Australians with equal access to online materials.

With the geoblocking technology currently being implemented, Australian consumers are frequently given access to lower-quality services with more limited catalogues for streaming services at a higher price point than is available to their overseas counterparts, the commission argued.

"Studies show Australian consumers systematically pay higher prices for professional software, music, games, and e-books than consumers in comparable overseas markets. While some digital-savvy consumers are able to avoid these costs (such as through the use of proxy servers and virtual private networks), many are relegated to paying inflated prices for lower-standard services," the commission said in its report.

"The Australian government should make clear that it is not an infringement of Australia's copyright system for consumers to circumvent geoblocking technology, and should seek to avoid international obligations that would preclude such practices."

As well as removing pervasive geoblocks, the commission made the finding that overall, timely access to movies, TV shows, and games is more effective than punitive measures when it comes to combating online copyright infringement -- which agrees with the Department of Communications' own research.

While it did not accept several of these digital-centric recommendations, the government did pass digital fair dealing for the Copyright Act earlier this year.

The Copyright Amendment (Disability Access and Other Measures) Bill 2017, passed in June, makes provisions for access to copyright material by those with a disability, along with protecting educational facilities, key cultural institutions, libraries, and archives from copyright infringement.