F E A T U R E S    Issue 2.01 - February 1996

The Copyright Grab

By Pamela Samuelson

Browsing through a borrowed book, lending a magazine to a friend, copying a news article for your files - all seem innocuous enough. But in the United States, the Clinton administration plans to make such activities illegal for works distributed via digital networks. If the legislation recommended in its "white paper on Intellectual Property and the National Information Infrastructure" is enacted, your traditional user rights to browse, share, or make private noncommercial copies of copyrighted work will be rescinded. Not only that, your online service provider will be forced to snoop through your files, ready to cut you off and turn you in if it finds any unlicensed material there. The white paper regards digital technology as so threatening to the future of the publishing industry that, it argues, the public must be stripped of all the rights that copyright law has long recognised - including the rights of privacy. US Vice President Al Gore has promised that the National Information Infrastructure (NII) will dramatically enhance public access to information; now we find out that it will be available only on a pay-per-use basis.

Why would the Clinton administration want to transform the emerging information superhighway into a publisher-dominated toll road? The most plausible explanation is also the simplest one: campaign contributions. The administration wants to please the copyright owners, especially members of the Hollywood community, who are vital to the president's re-election bid. And what these copyright industries want in return is more legal control than ever before over the products they distribute.

The US Constitution empowers Congress to pass laws "to promote progress of science and [the] useful arts." Congress has chosen to accomplish this constitutional goal by grant-ing authors a limited set of exclusive rights. Copyright protects all original works of authorship - including such things as personal letters and corporate memoranda - from the moment they are first fixed in a tangible form. This protection attaches automatically by operation of law and lasts for the life of the author plus 50 years. In the three centuries of its existence, copyright law has focused on regulating public and commercial activities, such as the commercial reproduction of physical objects embodying the copyrighted work (books, for example) for intended dissemination to the public, the commercial distribution of physical copies to the public, and public performances of dramas, music, and the like. (Singing a copyrighted tune in the shower is not an infringement because it is a private performance.)

Some publishers, however, want to control not only all public and commercial uses of their works, but all private uses as well. They assert that this would better fulfil the constitutional purpose of copyright, because the greater the financial return to them, the greater will be their incentive to make works available to the public.

Proponents of this view suffered a setback in 1984, when the Supreme Court ruled in the Sony Betamax case that taping a television program for time-shifting purposes in the privacy of one's own home was "fair use" (and consequently that Sony did not commit contributory copyright infringement against Universal and Disney by selling videotape machines).

But these publishers fear digital technology far more than videotape machines. Ever since they began to realise that digital technologies could "free" information dissemination, the established copyright industries have been shaking in their boots. Now a group of major motion picture producers, sound recording companies and print publishers have figured out a way to turn the threat of digital technology into an opportunity. Under this plan, they would retain all of their rights under existing law and quietly attain a host of new ones.

Bruce Lehman - Clinton's czar of intellectual property policy and the man in charge of shepherding the white paper's NII Copyright Protection Act through Congress - is, coincidentally enough, a former copyright industry lobbyist. Lehman, whose official titles are assistant secretary of commerce and commissioner of patents and trademarks, and chair of the intellectual property working group of the administration's NII task force, depicts the changes to copyright law recommended in the white paper as minor clar-ifications and updates to existing law. They are, in fact, a flagrant giveaway to copyright industries, softened only by two public-interest provisions added to make the package appear more balanced than it really is. (One provision expands library privileges to make copies of copyrighted works for archi-val purposes; the other permits nonprofit groups to distribute Braille or large-type editions of copyrighted works if the publisher has not done so within a year of publishing the standard edition of the work.)

Bipartisan bills to implement the white paper proposals were introduced in the House (HR 2441) and the Senate (S 1284) in late September 1995. Lehman and the copyright maximalists are relying on several factors to get this legislation through Congress fast, before the public realises what is happening and rouses itself to action. First, Congress finds it diffi-cult to say no to copyright producers, who are not only often glamourous but make a positive contribution to the US balance of trade (US$45.8 billion in 1993). Second, many influential members of Congress know and trust Lehman, who was a Congressional staffer before he became a copyright lobbyist. Third, copyright has become such a complex and esoteric law that many senators and representatives, as well as members of the press, will not be able to penetrate the 250-page, jargon-ridden white paper to learn that there is good reason to be sceptical about it.

Quick Congressional acceptance of the white paper's legislative package will help persuade courts to accept the white paper's interpretations of existing law as a kind of legislative history of the NII Copyright Protection Act.

So if the Clinton administration's legislative proposal is adopted, the maximalists may finally get the law they have always wanted instead of the more limited set of rights that the Constitution has long been understood to authorise.

The maximalist agenda

The eight interrelated parts of the white paper's agenda intend to:

1 Give copyright owners control over every use of copyrighted works in digital form by interpreting existing law as being violated whenever users make even temporary reproductions of works in the random access memory of their computers;
2 Give copyright owners control over every transmission of works in digital form by amending the copyright statute so that digital transmissions will be regarded as distributions of copies to the public;
3 Eliminate "fair use" rights whenever a use might be licensed. (The copyright maximalists assert that there is no piece of a copyrighted work small enough that they are uninterested in charging for its use, and no use private enough that they aren't willing to track it down and charge for it. In this vision of the future, a user who has copied even a paragraph from an electronic journal to share with a friend will be as much a criminal as the person who tampers with an electrical meter at a friend's house in order to siphon off free electricity. If a few users have to go to jail for copyright offenses, well, that's a small price to pay to ensure that the population learns new patterns of behaviour in the digital age.);
4 Deprive the public of the "first sale" rights it has long enjoyed in the print world (the rights that permit you to redistribute your own copy of a work after the publisher's first sale of it to you), because the white paper treats electronic forwarding as a violation of both the reproduction and distribution rights of copyright law;
5 Attach copyright management information to digital copies of a work, ensuring that publishers can track every use made of digital copies and trace where each copy resides on the network and what is being done with it at any time;
6 Technologically protect every digital copy of every work (by encryption, for example) and make illegal any attempt to circum-vent that protection;
7 Force online service providers to become copy-right police, charged with implementing pay-per-use rules. (These providers will be responsible not only for cutting off service to lawbreakers but also for reporting any copyright crime to the criminal justice authorities);
8 Teach the new copyright rules of the road to children throughout their years at school.

It's hard fully to appreciate how substantial a change the white paper would wreak upon copyright law until you grasp the negative synergies among its eight interrelated parts. The diminishment of "fair use" rights, for example, might seem less threatening when viewed in isolation than when viewed in conjunction with the white paper's call for an expansion of copyright owner control over browsing and transmissions.

The copyright maximalists are also hoping that rapid adoption of the white paper's legislative proposals will be a stepping stone to international adoption of their agenda. Bruce Lehman has already attended several international meetings advocating the Clinton administration's copyright package as the right set of rules for the Global Information Infrastructure (GII). At meetings sponsored by the World Intellectual Property Organisation, Lehman has urged that the white paper's legislative proposals be included in a supplementary agreement (known as a protocol) to the major international treaty on copyright matters, the Berne Convention. Since participation in the organisation's meetings is limited to intellectual property professionals associated with special interest groups or governmental organisations (many of whom, like Lehman, are now in policy-making positions in their governments), the chances for the maximalists to gain international acceptance of their agenda - at least by governments, if not by the people they purport to represent - seem strong. If they succeed, treaty obligations would substantially constrain member countries from later amending their national laws to make them less restrictive about information dissemination. So, if the public ultimately were to decide the maximal-ists' agenda is unacceptable, a whole new treaty would have to be negotiated to undo the damage. That would take years, if it could be done at all, and naturally the maximalists would fight it every step of the way.

The white paper seeks to implement the maximalist agenda partly by rewriting the copyright statute and partly by aggressively interpreting existing law. Legislatively, it seeks 1) an amendment to treat digital transmissions of works as distributions of copies to the public; 2) a new provision making it unlawful to tamper with copyright management information; and 3) a new provision to prohibit devices or services aimed at circumventing technological protection for copyrighted works. To implement the rest of the agenda, it relies on the old litigation trick of acting as though the law is already firmly on your side. Although the white paper purports to be an objective statement of existing law, it is really a skillful advocacy document; it takes the maximalist view on virtually every controversial issue of the day, often without acknowledging that contrary arguments or authority even exist. Where existing case law does not conform to the maximalist view, the white paper sim-ply ignores it. This bias becomes glaringly evident when one examines closely its treatment of the eight major issues:

1 The exclusive right to read: The white paper seeks to extend publisher rights to control browsing and other uses of copyrighted works in digital form by an expansive interpretation of existing law. It observes that in order to browse a digital work, the user's computer must make a temporary copy of that work in its random access memory; that temporary copy, it claims, is an infringing reproduction of the work unless it has been licensed or is otherwise privileged. The white paper relies on an appellate court decision that treated the unlicensed loading of a computer program in RAM as an infringing reproduction. But it knowingly omits reference to the legislative history of the current copyright statute, in which Congress specifically stated that the temporary storage of a copyrighted work in a computer's memory should not be regarded as an infringing reproduction. Rather than seek legislative clarification on this issue, the white paper simply pretends that under existing law, browsing is an infringement, hoping thereby to avoid tough questions from senators and representatives whose constituents might worry about grant-ing copyright owners an exclusive right to control all readings of digital works.

2 The exclusive right to transmit: Lehman has been leading the drive for adoption of the white paper's proposed NII Copyright Protection Act on the theory that it is unclear under existing law whether a digital transmission is a distribution of a copy to the public. The act, he says, will make clear that this is the case. But the white paper admits that the courts have already regarded digital transmission of copy-righted works as infringing distribution in some cases, so either there is an unstated purpose behind this proposal or else it is just a smoke screen to deflect attention from the real humdingers in the package. Lehman is probably seeking the digital transmission amendments because his pals among the maximalists want to be able to control all perfor-mances and displays of copyrighted works, not just the public performances and displays that the existing law grants to copyright owners.

3 The end of fair-use rights: The white paper attempts to eliminate fair-use rights by interpreting existing law as though fair use has no application when a use can be licensed (recall that the maximalists believe all uses can be licensed). Copyright maximalists, in fact, regard all unauthorised copying of copyrighted work as theft. This theory has, however, been rejected by the US Supreme Court. When Universal and Disney sued Sony to stop distribution of its videotape machines, they argued that private noncommercial copying of their motion pictures by purchasers of Betamax machines was no more excusable than the theft of a necklace because the thief intended to wear it only at home for noncommercial purposes. The Supreme Court pointed out that the person who steals a necklace deprives its owner of possession and use of the item, whereas the copying of programs off the air "does not even remotely entail comparable consequences for the copyright owner." The court held that it was fair use for consumers to copy programs off the air for time-shifting purposes. Indeed, the court said that private, noncommercial copying should be presumed fair use.

The white paper makes no mention of this aspect of the Sony ruling. It reinterprets the case as though the Court found no infringement because Universal and Walt Disney had not yet established a licensing market for off-the-air copying of their works.

The notion that fair-use rights apply only when no licensing market exists is neither historically accurate nor good public policy. It ignores some important free speech and related public interest functions of fair use that were recognised in cases such as Time Inc. v. Geis. Time sued Bernard Geis for copyright infringement because he included in his book about the Kennedy assassination sketches of frames from the Zapruder film (whose copyright Time had acquired) to illustrate his rationale for concluding that Lee Harvey Oswald was not the sole gunman. Time magazine lost this lawsuit - not because it had no pricing schedule by which Geis could have licensed the right to reproduce the frames, but because allowing Geis to use the frames in his book was consistent with the constitutional purposes of copyright to promote knowledge, public access to knowledge, and public discourse about this important event. The same rationale explains why senators and representatives read newspaper articles into the Congressional Record to preserve their importance to public debate on controversial issues, and why many of us share copies of articles with people we know are concerned about particular issues.

Another case illustrating the broader public policy purposes of fair use is Sega v. Accolade. (The white paper also ignores this case.) Accolade decided not to pay the license fees to Sega that would give it access to information about how to make its videogames run in Sega Genesis machines. Instead, it decompiled the Sega code, extracted the interface information, and then wrote program code to reimplement the interface so that Accolade's cartridges would run in the Sega machines. Sega charged Accolade with copyright infringement arising from its decompilation efforts. A federal appellate court decided that Accolade's intermediate copying of the Sega program for a legitimate purpose, such as getting access to the functional requirements for achieving compatibility, was a fair use. The court thought that ruling in Sega's favour would undermine copyright principles by giving Sega a broader monopoly over the contents of its program than Congress had intended. In contrast, ruling in Accolade's favour was consistent with the constitutional purposes of copyright to promote the creation and distribution of new non-infringing works.

4 Eliminating "first-sale" rights for digitally transmitted documents: Copyright owners have historically been entitled to control only the first sale of copies of a work to the public. After that, the consumer who has bought the copy can share it with a friend, give it away, or resell it. (Libraries rely on first-sale rights to lend copies of books to the public.) Consumers would expect the same rule to apply if the copy was electronic. But the white paper says that sharing your copy of an electronic work with a friend is illegal because, in order to send that copy to your friend, your computer will have to make a copy of the document; since that copy hasn't been authorised by the copyright owner, an infringing reproduction of the work has taken place. If the white paper had wanted to retain the balance of interests embodied in current law, it would have suggested that the intermediate copying necessary to effect a user's first-sale rights should be regarded as a fair use under precedents such as Sega v. Accolade.

5 Helping documents spy on you: The white paper anticipates that publishers will want to attach copyright management information to digital forms of their works. It defines copyright management information as "the name and other identifying information of the author of a work, the name and other identifying information of the copyright owner, terms and conditions for uses of the work, and such other information as the Register of Copyrights may prescribe by regulation." It proposes to protect this information against tampering by making it illegal knowingly to remove or alter copyright management information or to distribute copies of works whose information has been tampered with. Money damages and criminal penalties would await violators.

While one can question whether it's necessary to make tampering with copyright management information a crime (much less a felony), this provision seems relatively innocuous at first sight. I didn't start worrying about it until I heard proponents talking about how copyright management information systems might be implemented. Some favour making these systems "dumb," while others favour making them "smart." Dumb systems would simply identify the work with a digital equivalent of the ISBN numbers used in the book world today. Smart ones would, among other things, have the ability secretly to report back to the copyright owner via the network on what the user was doing with the work, and the ability to search the consumer's hard disk and report back on what else was there. The Microsoft registration wizard may be just the beginning of the intrusive snooping to which copyright owners will be prone - only, in the future, it won't be possible to say no, and any effort you make to block these intrusions may make you a felon.

Plans are also underway to develop secure processors that won't permit copying of digital works unless their copyright management information authorises it. Some publishers are already talking about getting governments to mandate inclusion of these secure processors in all reprography technologies (including photocopy machines). The precedent they offer for this mandate is the serial copyright management system requirement imposed on manufacturers of digital audio-tape machines. They conveniently forget that the law regulating these machines does not ban all unauthorised copying; it permits consumers to make first-generation copies but not multiple secondary reproductions identical in quality to the digital material from which they are derived.

There is very little in the white paper to inform Congress or the public about these additional plans for copyright management information. It's also worth noting that the white paper never contemplates a situation in which a user might have a legitimate reason to alter copyright management information or to defeat technological protection. It appears to assume that all consumers of information products are would-be thieves and that all content owners are just trying to make an honest living.

6 Outlawing decryption: Many copyright owners are planning to protect digital forms of their products by technological means such as encryption. To ensure the security of this technological protection, the white paper recommends the following legislation: "No person shall import, manufacture, or distribute any device, product or component incorporated into a device or product, or offer or perform any service, the primary purpose or effect of which is to avoid, bypass, remove, deactivate, or otherwise circumvent, without the authority of the copyright owner or the law, any process, treatment, mechanism, or system which prevents or inhibits the violation of any of the exclusive rights of the copyright owner under section 106."

Civil penalties for violation of this law will include having to pay statutorily established damages and having any equipment used in the process (your computer, for example) impounded.

While one can understand the desire to prevent decryption for the purposes of redistribution and profit, the provision doesn't require either of these as a precondition for liability. Merely manufacturing or distributing a technology that can be used to undo a system that a copyright owner has adopted to protect its work seems sufficient to incur liability.

Although the white paper doesn't say so, this legislation would overturn a second ruling in the Supreme Court's Sony Betamax decision that held that copyright owners cannot stop distribution of a technology as long as it has a substantial non-infringing use.

In addition, the language of this proposed law is so broad and so vague that it can be construed as outlawing many activities widely believed to be lawful. Take one example: some software publishers will argue that decompilation of mass-marketed software in order to get access to interface information violates this provision, because the decompiler would be performing a service whose primary purpose and effect was to bypass the technological system the program's developer had adopted to protect its program (distribution of the program in object code form in order to maintain the contents of the program as a trade secret). Although Sega v. Accolade and another federal appellate court decision has affirmed the right of software developers to decompile software for compatibility purposes, the white paper doesn't mention the decompilation and compatibility case law at all. Lehman and the maximalist software publishers who used to be his clients continue to believe that decompilation is - and should be - illegal. They are hoping to overturn the decompilation case law indirectly by the white paper's endorsement of some changes to commercial law that would validate common terms in shrink-wrap licences, such as prohibitions on decompilation.

Some may argue, for example, that it prohibits the manufacture and sale of photocopying machines on the grounds that their primary use is to make unauthorised copies of copyrighted works. Another thing the white paper doesn't mention is that previous industry at-tempts to protect copyrighted works in digital form by technological means failed in the marketplace as well as the courts. Users, who often felt there were legitimate reasons for them to have access to an un-restricted version of a program, created a demand for programs that could defeat software copy-protection systems. Lit-igation soon ensued. Vault, whose copy-protection software could be defeated through use of Quaid's unlocking pro-gram, sued Quaid to try to stop distribution of the latter's software. Vault relied in part on a Louisiana state law intended to validate common terms of software shrink-wrap licences. But because Quaid's software allowed purchasers of application programs to exercise rights conferred on them by copyright law to make back-up copies and modifications to the software, the court decided that what Quaid had done was lawful. To the extent that the Louisiana law might stop users from exercising their rights under copyright law, the court decided that the state law conflicted with the purposes of federal law and was unenforceable. The message of the marketplace was equally clear: Software developers eventually abandoned the distribution of copy-protected software because it was unpopular with consumers. Even though the market for locking and unlocking software has died out - making it easy to copy software in digital form - the software industry as a whole has thrived.

7 Turning online service providers into cops: The white paper asserts that every online service provider is already liable for all copyright infringement committed by its users, regardless of whether the service has reason to know about the infringement or takes reasonable steps to ensure that it won't occur. To back up this view, the white paper cites two lines of cases. In one set, employers were found vicariously liable for copyright infringement by their employees when they had the power to supervise their employees' activities and financially benefited from the infringement. In the second set of cases, nightclub owners had to pay damages for infringements by bands they hired to play even though they had warned the bands not to perform copyrighted music without a licence, because they had rights to supervise the bands and because they benefited from the infringement.

There is, however, other case law that goes unmentioned in the white paper and that supports the online service provid-ers' contentions that they should not be held strictly liable for user infringements. Landlords, for example, have escaped liability for infringements committed by their tenants both because they had very limited power to inspect the infringers' premises or supervise their activities, and because they didn't benefit financially from the tenants' infringement. Online service providers liken themselves to landlords because they typically "rent" space on their computers to users who store private material, such as e-mail, there. Also, they typically do not monitor user activities (except for automated searches for certain profane words or screening for threatening language). Indeed, they are forbidden by the Electronic Communications Privacy Act from monitoring the content of private user messages, another factor in the balancing equation which the white paper ignores. They also argue that they don't benefit financially from user infringements.

Some commentators have argued that imposing a strict liability rule on online service providers is inconsistent with the public policy purposes underlying copyright law because it will chill so many noninfringing online exchanges of information. If online service providers have to monitor everything users do, they will artificially impose centralised structures of control over user communications.

The danger that overzealous copyright owners will sue online service providers in order to censor online communications has already evidenced itself in the ongoing Church of Scientology v. Netcom case. (Scientologists have sued Netcom and a church dissident for copyright and trade secret violations because he used his Netcom account to criticise the church's teachings. See Wired 1.04, page 44.)

The white paper is quite frank in its view that online service providers should become centralised control centres to enforce copyright law. "They - and perhaps only they - are in a position to know the identity and activities of their sub-scribers and to stop unlawful activities. And, although indemnification from their subscribers may not reimburse them to the full extent of their liability and other measures may add to their costs of doing business, they are still in a better position to prevent or stop infringement than the copyright owner. Between these two relatively innocent parties, the best policy is to hold the service provider liable." This statement, however, ignores the privacy interests of users, in addition to serious questions about whether it is technically feasible for online services with millions of subscribers to do the continuous mon-itoring of user accounts that copyright owners might like. The white paper acts as though the interests of copyright owners so override other, competing inter-ests that it isn't even worth mentioning what the other interests are, let alone trying to balance them against the copyright owner interests.

8 Teaching children not to share: To ensure that future generations are brok-en of the habit of thinking that it's OK to share copies of copyrighted works with a friend, the white paper offers examples of lessons about copyright that could be taught as early as nursery school and as late as university. The general theme of these lessons, in order not to be too negative, would be, "Just say yes" to licensing. (It actually says this.)

Reasons to say no to the white paper's agenda
When Bruce Lehman talks to the public about the white paper, he acts as though unless copyright law is strengthened, no content will be available on the NII, because publishers won't have the incentive to provide it. The white paper seems oblivious to the phenomenal growth of the World Wide Web and other sites on the Internet where a wide variety of content is already available.

In the few places where the white paper acknowledges the existence of Net cul-ture, it is overtly hostile to it, characterising it as a "legal free-for-all [that] would transform the GII into a veritable copyright Dodge City." Lehman aims to be the sheriff who will kick those anarchic digit-al cowboys off the Net and make the electronic frontier safe for businesses that want to set up shop there.

Lehman also likes to invoke for the public a utopian vision of ubiquitous and cheap availability of content on the NII if the public accepts his proposed changes to copyright law. If people will only pay for each access to a work, he implies, content owners will make their intellectual property widely available for lower prices, because they will now be able to charge, say, a dollar (63p) a hit, instead of 10 dollars (£6.25) for a printed copy, to make the same profit on a given work. Yet the white paper contains no promises that consumers will be charged lower prices in exchange for giving up fair use, first sale and other rights.

History teaches us that we should be sceptical about claims that giving publishers broad monopoly rights will be in the public interest. During the first centuries after the invention of the printing press, publishers had considerably stronger monopolies than modern copyright laws grant them. They used these broader rights to charge excessive prices and censor dissenting views. When the British Parliament passed the first modern copyright law in 1710, it did so in part to stop publishers from oppressing authors, potential competitors and the public. If the government confers stronger monopolies on publishers again, why should we believe that ubiquitous access and low prices will necessarily ensue?

Enlarging publisher rights would also provide massive subsidies to the dino-saurs of the second wave - today's largely print-based copyright industries, which are terrified of the digital domain and generally don't have the faintest idea about how to market the content in their portfolios on the Net. The only way the entrenched copyright industries can imagine marketing content electronically is through extensive technological locks that will make digital information less free than print information.

The white paper gives no thought at all to the needs or concerns of emerging electronic information industries, such as firms that add value to existing information resources, and it seeks to hobble the only kind of Third Wave information service it recognises - online service pro-viders - by forcing them to undertake the costs of policing users on behalf of established copyright industries.

We should also not assume that these copyright maximalists are good judges of what's in their long-term best interest. It wasn't so long ago that major motion picture producers were bewailing the advent of videotape machines as the end of film revenues. They lost their battle to ban the sale of these machines - with the result that a whole new and unanticipated market for their products emerged in the form of videotape sales, a market that has brought further prosperity to the film industry and satisfaction to the public.

It is, in fact, too early in the development of markets for delivery of electronic information products and services to start the kind of heavy-handed government regulation that the white paper would bring about. It would be more sensible to wait to see what kinds of markets emerge and then figure out what, if any, legal fences are needed to avert market failures. Pushing through legislation mandating the maximalist vision before there is public consensus in support of it could backfire by eroding the public's faith in the essential fairness of copyright law. This is hardly in the long-term interest of the publishing industry.

But the copyright maximalists and their lobbyists are not thinking about how to promote real public respect for copyright law, or about what is in the public interest. Instead, they have a strategy: to rush the white paper's legislation through Congress today and force it down the public's throat tomorrow. If the American public doesn't want this policy forced down their throats, they'd better do something, and quickly. Thanks to Hal Abelson, John Perry Barlow, Robert Glushko, Peter Jaszi, Mitchell Kapor, Jessica Litman, and David Post for their help with this article.

Pamela Samuelson (samuelson@law.mail.cornell.edu) is a visiting professor of law at Cornell Law School and a Fellow of the Electronic Frontier Foundation.

  Copyright is a Global Issue

Vanessa Marsland

The old world order in copyright is dying. Countries everywhere have realised that copyright law must change to cope with the new realities of the global, digital intellectual property marketplace. Japan, Canada, and Australia are all debating reform of their national copyright laws. The European Union recently released a green paper that details proposals for reforming and harmonising Europe's copyright laws. The World Intellectual Property Organisation (WIPO), keeper of the Berne Convention, the treaty which governs the global application of copyright laws, is working to extend that treaty to fit a networked world. Everywhere in the global debate, US diplomats and lobbyists urge tighter copyright protection, and quicker, more effective harmonisation of copyright laws.

Ironically, only a hundred years or so ago, the United States itself was a nation of copyright pirates; Britain and other copyright exporters complained bitterly about the poor protection offered their copyrighted works. But that was before America came to dominate global markets for film, music, software, books, and the like. Today, the United States has more at stake than most other nations. So documents like the "Intellectual Property and the National Information Infrastructure" white paper directly reflect the US's national economic interests. On the global stage, balancing the interests of the copyright haves and have-nots is as important - and as controversial - as balancing the needs of copyright suppliers and its consumers is at the national level.

Formerly, international copyright agreements evolved at a fairly leisurely pace, following developments in national law. Take software, for example. The United States extended its national laws to offer software copyrighting in the 1970s. European nations followed suit in the 1980s, and the European Union harmonised national software-copyright laws with the 1991 Software Directive. But the Berne Convention still has not been updated to encompass software - although WIPO's reforms of the treaty will address this omission.

The United States finds that the pace of international copyright developments is too slow. The same technological changes that have thrown copyright into confusion have also rendered more or less unworkable the old model of copyright reform - a rolling process of national change followed by gradual international consensus-building. In a global, digital marketplace, the risk is high that any country not providing protection to minimum international standards will also supply pirated material to the rest of the world on demand. Software developers have already learned to their cost that computer bulletin boards can make illicit copies of new programs globally available, even before the first legal copies hit the shops. And those who create multimedia products have found that gathering international rights to the material in their works can easily eclipse the rest of the production budget, mostly due to the complexities that arise out of different national copyright laws.

So the United States has brought considerable pressure to bear on countries it perceives as being lax on copyright protection. It unilaterally restricted trade with China, among other countries, until China agreed to crack down on copyright pirates. It lobbied hard during the 1992 Uruguay Round for the General Agreement on Tariffs and Trade to adopt provisions laying down minimum international standards which protect copyright and other forms of international property - standards that provide a multilateral base upon which countries can restrict their trade with violators. And the US has also backed WIPO's efforts to extend the Berne Convention, perhaps more so than has any other nation.

The Clinton administration's proposals come at a crucial time in the international debate. If the US adopts them, its lobbying abroad will quickly reflect this. And many of the proposal's issues are under discussion outside the US as well. Some important issues include:

1 Permitted copying. Some acts have traditionally been exempt from copyright restrictions. Most European countries, for example, permit home taping of sound recordings - and compensate musicians from the proceeds of a levy on blank tapes. Some European countries also make a levy on photocopiers to compensate authors and publishers. But how to extend these rights into the digital realm poses a problem. A levy on blank diskettes, or PCs, is too blunt a tool to cope with all the different materials - of widely differing value - which might be copied in the digital realm. Under Anglo-Saxon common law traditions, legislators solve the problem by allowing those who purchase copyrighted materials "fair dealing" (or "fair use" in the US) - and leave the courts to define what constitutes "fair dealing." (British courts consider photocopying a single magazine article for personal use to constitute fair use.) But continental European systems of law require fair usage to be defined a priori - which is proving extremely difficult.

2 First sale. Traditionally, the publisher's rights under copyright have ended with the sale of a book or magazine. Pur-chasers get to do whatever they want with the copy they bought - loan it, sell it on, or whatever - so long as they do not make another copy (which is quite difficult anyway). Digital works, though, are much easier to copy. So the European Commission's green paper, like the Clinton administration's white paper, proposes to extend publisher's right after sale to try to give them powers to monitor and prevent copying.

3 Policing copying. A necessary first step to controlling illicit copying is to detect it. One proposal discussed in the European green paper is to require copyright-holders to label their works with the digital equivalent of a watermark - an uneras-able registration mark, like an ISBN or ISSN number, so that even substantially modified copies of a work can be traced back to their digital ancestors. Some would restrict copyright protection to those who put such digital marks on their works, or who use copy-protection technologies that try to make unauthorised copying impossible. But thus far, most seem to think that requiring such technological fixes would penalise authors and favour large publishers over small. In most parts of the world, works are automatically copyrighted to the author as soon as they are produced - without any registration or application procedure.

4 Moral right. Most European countries give a strong moral right, separate from copyright, to a work's creators. (The moral rights tradition is weaker in Anglo-Saxon countries.) While a publisher might hold copyright to a book, say, the author maintains the following moral rights: to be identified as author, to oppose modification of the work, and in some countries, to recall a work from the public eye. Balancing the respective rights of authors and copyright-holders in a digital world presents many vexing questions. Should the holder of moral rights be able to control annotations made to his or her works online? Should the author be able to dictate how it will be presented in a multimedia compilation? And, if so, how?

International bodies will soon be trying to decide all of these issues. The European Union's green paper has engendered discussions which will probably mature into concrete proposals for new copy-right legislation sometime in 1996.

WIPO is similarly being pushed to come up with extensions of the Berne Convention to cover software, databases, digital transmission, and cross-border usage in a digital world - and, for political reasons, US negotiators are pushing extremely hard for a deal before the impending 1996 presidential elections. While international treaties are inevitably more abstract than national laws, they set important minimum standards.

To consider the Clinton administration's proposals as mere domestic politics misses the point: In a global market, any legislation will sooner or later be subsumed in a global framework. And given the pace of change, Lehman's impact will more likely come sooner than later.

Vanessa Marsland (vanessa.marsland@cliffordchance.com) is a partner at Clifford Chance in London, specialising in copyright and other intellectual property issues.

  How to Get Involved in the White Paper Debate

The white paper can be found online at iitf.doc.gov/.

Opponents of the white paper's recommendations have formed an umbrella group called Digital Future Coalition. Interested parties can post at gurukl.ucc.american.edu/dfc/dfc.html.

Bruce Lehman, President Clinton's point man on the proposed legislation, can be reached at:
Assistant Secretary of Commerce and Commissioner of Patents and Trademarks US Patent and Trademark Office CPK 2, 2121 Crystal Drive, Arlington, VA 22202
phone +1 (703) 305 8600
PR office phone +1 (703) 305 8341
fax +1 (703) 308 5258
e-mail blehman@uspto.gov

For more information about the administration's position on the bill, contact:

Sally Katzen, Administrator
Office of Information and Regulatory Affairs Office of Management and Budget
Chair, IITF Information Policy Committee
Old Executive Office Building, Room 350
Washington, DC 20503
phone +1 (202) 395 4852, fax +1 (202) 395 3047
e-mail ipc@a1.eop.gov

The bill's sponsors:

Orrin G. Hatch
United States Senate
SR-131 Russell Senate
Washington, DC 20510-4402
phone +1 (202) 224 5251

Patrick J. Leahy
United States Senate
SR-433 Russell Senate
Office Building
Washington, DC 20510-4502
phone +1 (202) 224 4242
e-mail senator_leahy@leahy.senate.gov

Patricia Schroeder
US House of Representatives
2307 Rayburn House Office Building
Washington, DC 20515-0601
phone +1 (202) 225 4431
fax +1 (202) 225 5842

Carlos J. Moorhead
US House of Representatives
2346 Rayburn House Office Building
Washington, DC 20515-0527
phone +1 (202) 225 4176
fax +1 (202) 226 1279