OWNERSHIP OF THE COPYRIGHT IN SOUND RECORDING –AN ILLUSIONARY OR ACTUAL RIGHT

OWNERSHIP OF THE COPYRIGHT IN SOUND RECORDING –AN ILLUSIONARY OR ACTUAL RIGHT

The burning question in today’s business scenario is whether the owner(s) of copyright in the sound recording ceased to be the owner thereof for all practical purpose and intent. Whether owner has lost all his rights to decide and determine as to whom he ought to permit broadcasting of this recordings and with whom not to enter so. Whether the owner of copyright in sound recording is entitled only for the royalty and has lost all other rights in respect of the sound recording it owns. Whether the ownership is illusionary and not real. Whether the Legal Position is same for the broadcasters of Televisions Programs.

INTRODUCTION

The recent past have seen remarkable change in the Indian eco-legal scenario, Intellectual property Rights being one of them. A neglected Branch a law suddenly assumed great importance in the eyes of Corporates, Legal Professionals and even Law Students. It a common phenomena to find large number of Students pursuing their career in the Intellectual property Rights and its demand and importance has increased manifold in the Indian Corporates in the last few years. The Obvious reason is fierce competition at the market place and imitation and duplicate products resulting in need for better protection of their Trade Marks, Copy Rights and Patents.

LEGAL PROVISIONS

Copyright in India is governed by the Copyright Act, 1957, which provides that Copyright in the property subsists in

(a) original literary, dramatic, musical and artistic works;

(b) cinematograph films; and

(c) sound recordings (Section 13).

The purpose of the Copyright Act is to grant a statutory right and protection to the author / owner of the work in which copyright subsists, as reorganization of his efforts and further to grant him monopoly rights for its exploitation (Commercial or otherwise). Interestingly this act does not requires compulsory registration of the copyright for availing the benefits and protection available to the owner under the Act and the registration of copyright has been made optional. Owner of the Copyright work has been empowered to grant license to various persons for use of its work. ( Section 30 )

Nonetheless, in the interest of the General Public the copyright board has been empowered to grant compulsory license (i) where the copyright work is withheld form the public (Section 31) (ii) in case of unpublished Indian work (Section 31A) (iii) Produce and Publish Translation (Section 32) (iv) reproduce and publish work for certain specified purposes (Section 32A).

The understanding of the industry experts on the subject was, under the provisions of section 31 of the Act the Copyright Board can grant a Compulsory License on the satisfaction of the following conditions :-

(1) The work in respect of which the compulsory license is sought is withheld from the Public.

(2) Owner has refused to make the work available to the Public.

(3) The ground(s) for refusal by the owner are not reasonable.

(4) Owner is being afforded an opportunity of being heard.

(5) The license in granted subject to the payment of royalty fixed by the Copyright board.

RECENT SUPREME COURT LANDMARK JUDGMENT

Hon’ble Supreme Court in its Landmark Judgment of “M/s Entertainment Network (India) Ltd. Versus M/s Super Cassette Industries Ltd” delivered on 16^th May 2008 by a bench constituting of Hon’ble Mr. Justices S.B. Sinha, J. and Lokeshwar Singh Panta , J. has clarified the legal position in this respect. Hon’ble Supreme Court after taking stake of the legal position and also the international treaties entered into by India and the Legal Position in different countries of the world held that :-

There cannot be any doubt whatsoever that an artistic, literary or musical work is the brain-child of an author, the fruit of his labour and, so, considered to be his property.

A copyright, however, unlike a trade mark is a right created under the Act as is evident from Section 16 thereof. When an author of a copyright and other claims a copyright, it is subjected to the provisions of the Act.

The Legal Position of the Copyright in Original Work and Sound recording stands on the different footing as copyright in original literary, dramatic, musical and artistic works not only remains protected in the entire life time of the author but also until 60 years from the beginning of the calendar year next following the year in which the author dies. Whereas in case of sound recording it subsists only for 60 years. Nonetheless, it does not mean that right in sound recording is in any way inferior to that of right in original literary work etc. There are indications in the Act that Sound Recording and Literary, dramatic or musical work operate on different fields and cannot be equated.

India is a signatory to the International Covenants, the Copyright law should have been amended in terms thereof. Only because laws have not been amended, the same would not by itself mean that the purport and object of the Act would be allowed to be defeated.

Though the Copyright law has not been amended in terms of the International Conventions, but Supreme Court has at several times applied the International Conventions to interperate domestic Laws.

Supreme Court has also taken note of the fact that both “Berne” and “Rome” Conventions provides for the liberalized process of the broadcasting of the sound recordings.

INTERNATIONAL POSITION

Under Section 109 of the Australian Copyright Act, a free to air broadcaster of a sound recording requires a license and all is to be done is to give an undertaking to pay a royalty for broadcasting of published sound recording.

China follow the Berne Convention for International recordings. Domestic recordings can be broadcasted on the radio or television without any license or payment. However commercial broadcast requires a license and all is to be done is to give an undertaking to pay a reasonable sum which in the event of dispute will be decided by a competent tribunal.

In Japan Director General of the Cultural Affairs Agency will determine the compensation required to be paid by a Broadcaster. Non-profit transmission of works already made public is exempted from paying any royalty.

In U.K. statutory licensing and compulsory licensing exists.

LAW AS LAID DOWN

To put it in the common man’s language, the law laid down by the Supreme Court is :-

Sound Recording stands on the different footing than that of other literary, dramatic or musical work and there is no statutory requirement that a compulsory license can be granted only once the work is withhold from the public.

Compulsory License can be granted even the work in not withheld form the public and is made available to the public, but on owner’s refusal to permit a broadcaster to broadcast the work. Refusal also means demanding of the royalty or compensation which is high or imposing unreasonable restrictions therein.

Only because the compulsory license has been granted to one person it will not take away the jurisdiction of the copyright board to grant compulsory license to another person(s).

QUESTIONS BEFORE THE INDUSTRY

Will it mean that in the present economic scenario, the contractual rights of the owner of sound recording are non existent. Does the owner looses his rights to decide as to whom he should issue the license and whom he should not? Does the owner also looses his rights to decide as to the terms and conditions on which he ought to issue the license? Is the owner not free to quote different prices to different persons for the issue of license? Are we reverting to the price and supply control regime qua sound recording rights where the owner looses his rights to choose the buyer and the price which he wants to charge? Does the ownership is illusionary? Is there really any requirement to curb the rights of the copyright owners of sound recording to the extent mentioned above in the economy which has traveled from the highly controlled economy (Pre 1990 era) to the deregulated economy as of now?

CRITICAL ANALYSIS OF THE JUDGMENT

Though right to property has been deleted form the constitution as a “Fundamental Right”, but still the contractual rights of the persons and freedom to enter into a contract find itself in the statute book ( Contract Act- Formation of contract by offer and acceptance – Acceptance to be the absolute discretion of the party to the contract). Besides, except in exceptional circumstances (Few of the Sections of Essential Commodities Act imposes certain restrictions) the right of the owner to deal with the property in the manner in which he likes is not curtailed. Besides, we are moving towards the market driven economy in which all the market forces are permitted to play its role for the determination of demand and supply and we have traveled much on such road since 1991 when India has slowly started deregulating its economy. In such a scenario will the Landmark Judgment act an a catalyst or accelerator for the industry. Is it necessary to curtain the contractual rights of a owner of the sound recording of the copyright on the premises that the owner enjoys the monopoly powers and therefore even though the work is available to the general public but since the owner has refused to allow the broadcast through a particular channel, copyright board has the power to grant compulsory license to the broadcaster. Or is it the international conventions which has tilted the mind of the Hon’ble Judges to the effect.

If it is the monopoly, it is worth mentioning that the contractual powers of even the monopolistic establishment in respect of its dealing with the customers / buyers / purchasers were not taken away under the MRTP Act. If the legislature thought it prudent not to place any restrain on the contractual powers of Mopolistic Undertaking which , obviously, controls a sizable portion of trade and commerce in the field in India, is their any justification for doing so in case of Music Company. Besides, had it been only the monopoly rights which the owner of the sound recording enjoys, there would not have been any reasons as to why the owner of other copyrights ( who also happen to enjoy the monopoly powers) ought to have been exempted. Or are we in the transition phase and the concept of monopoly powers will be carried forward to curtail the contractual rights of all the copyrights owner, in times to come? Unfortunately, only time has the answer.

Is it the international conventions, to which India is a signatory, which has tilted the mind of the Hon’ble Supreme Court. It is worth mentioning that the copyright act has not been amended in lines with the International convention signed by the India. And the law on the statute book is the same as that of 1957 ( subject to the amendment from time to time). Nonetheless, India has came out with the International Copyright order of 1999. International convention signed by India as well as the Legal Position prevalent in other countries of the world has been taken note of by the Hon’ble Supreme Court in deciding the issue. It further held that only because the Law , in accordance, with the international conventions, has not been amended, will not mean that the purport and object of the Act would be allowed to be defeated.

CONCLUSION

Law of the land is the ratio laid down by the Hon’ble Court and it has to be adhered to. But the question of the competence of the Hon’ble Supreme Court to legislate is still a debatable issue.

The Last but not the least is whether the proposition laid down above in case of broadcasting of sound recordings will also hold good for the broadcasting of the programs by televisions channels. Unfortunately, the obvious answer seems to be, yes.

The factors which has resulted in the delivery of the judgment in issue are many, whatsoever the reasons may be , but it is an undoubted position that at least the sound recording industry will be hit by the judgment to a large decree. This also opens a watch gate for other industry which are copyright protected that the concept of monopoly, international convention and applicable law in various other countries may, at some point of time, may also take away their contractual rights and confer the copyright board power to grant compulsory license.

PRESENTED BY :-

Praveen Agrawal,

Advocate on Record,

Supreme Court of India

B 73, Shakhar Apartment,

Mayur Vihar – I, Delhi 91

Phone 098117 -02850