Torrents, Netflix Crackdown: Are The Rumours True?

Internet Piracy Visual

Recent changes to Canada’s copyright laws have created a major buzz. These changes are the largest overhaul of copyright legislation in a long time.

Starting this year, Canadians can expect to receive warning notices if they are suspected of downloading copyright protected materials from the Internet. Legislative changes that came into effect last week require Internet service providers (“ISPs”) to distribute notices of alleged copyright infringement. In the past, this was a voluntary activity. ISPs must retain records of the notices they receive and forward these notices to users for at least 6 months in case a copyright owner decides to pursue legal action. This has resulted in scores of worried consumers who fear they are going to lose access to their favourite TV shows, face fines or even lose their Internet hook-up. Are the rumours true? Will consumers need to change how and what they watch on TVs, tablets, cell phones and other devices?

What has exacerbated things is that these recent legislative changes have coincided with a rumoured Netflix crackdown involving Canadian users who bypass licensing regulations to access shows from the U.S. service. Recent stats reveal that 3,000,000 cases of illegal downloading and video streaming have occurred in Canada over a 90-day period. Many notices have been sent to Canadian consumers threatening them with draconian financial penalties and threats of vanishing Internet service.

As usual, it’s up to consumers to educate themselves on their rights and responsibilities so they don’t fall victim to false demands for payments and other bullying behavior by large market players. The government said the new regulations were crafted in consultation with more than a dozen ISPs and more than 35 copyright owners including representation from the music, film and literary industries.

The Canadian approach to unauthorized downloading is now centered on a “notice-and-notice” system. ISPs are now required to forward notices of copyright infringement to their subscribers at the request of the rights holder. The Internet provider is not required to disclose the subscriber information nor take any further action. Canada’s rules are meant to stop copyright trolls. Copyright trolls are those who hope to make money by threatening people with legal action if they don’t pay up. These new rules are designed to prevent abusive behavior by companies who could send out thousands of demand letters essentially saying, “Hand over $10,000 or we’ll take you to court and you’ll be forced to pay $50,000!”

Should you be scared of the new rules? The short answer is no. You are safe as long as you’re not in the business of piracy. If you are, then you could face some stiff adult penalties. The minimum fine for non-commercial infringement is $100 and the maximum is $5,000 for all infringements in a lawsuit. This is considerably less than the $20,000 penalty which remains in place for commercial infringement. The Canadian landscape is very different than our American counterparts where penalties can be as high as hundreds of thousands of dollars.

Not all of the legislative changes are scary. A wide range of user-oriented provisions now legalize common everyday activities such as the recording of television shows or “time shifting” as it is referred to by techies. Beam me up Scottie!

Entrepreneurs should be relieved to know that legislators have expanded the scope of fair dealing. Fair dealing allows users to make use of excerpts or other portions of copyright works without the need for permission or payment or the fear of liability. The scope of fair dealing has been expanded to encompass 3 new purposes: education, satire, and parody. This is in addition to the existing 5 purposes of research, private study, news reporting, criticism, and review.

A legal safe harbour has been created for creators of non-commercial user generated content such as remixed music, videos, or home movies with commercial music in the background. Techies commonly refer to this as the “UTube Exception.” Feel free to keep on Utubing and happy Internet surfing!

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*The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Bal Bhullar
Bal Bhullar is a corporate/commercial lawyer who owns and operates C2K Law Corporation. Bal has over 20 years of international and domestic practice experience. He has worked in private practice in Vancouver and Bermuda as well as in-house with public and private companies in the mining, aviation, telecom and technology, construction, oil and propane, insurance, management consulting and health care industries. Bal's areas of expertise include corporate finance, banking law, mergers and acquisitions, joint ventures, corporate restructurings, governance and compliance, company law, contracts and all types of commercial transactions. Bal is the member of the Law Society of B.C. and is admitted as a Barrister and Attorney in Bermuda. Bal is a business savvy lawyer who is solutions oriented and focused on delivering high value advice and service to all of his clients.