(Online Infringement) Bill 2015 (Cth) 16 April 2015

Music Rights Australia's submissions in response to the Copyright Amendment (Online Infringement) Bill 2015 (Cth) 16 April 2015 Contents 1 About Music Rights Australia 2 2 Executive Summary 2 3 Why Australia needs an injunction to disable access to infringing online locations 2 4 Threshold limitations 3 4.1 The primary purpose to infringe, or to facilitate the infringement of, copyright 4 4.2 Service 4 4.3 Matters to be taken into account 5 5 Other limitations imposed by the Bill 8 5.1 Who can bring an application? 8 5.2 Limitation to carriage service providers 8 5.3 Costs 8 5.4 Jurisdiction 9 Annexure A - ARIA Charts Analysis – March & April 2015 10 Annexure B - Comparison of international website blocking laws 12 Annexure C - Website Blocking Cases in the United Kingdom 20 page 1 1 About Music Rights Australia Music Rights Australia (MRA) is an organisation that protects the creative interests of artists within the Australian music community. MRA represents over 70,000 songwriters and music publishers through their association with the Australasian Mechanical Copyright Owners' Society (AMCOS) and the Australasian Performing Right Association (APRA),1 and more than 125 record labels - both independent and major - through the Australian Recording Industry Association (ARIA).2 2 Executive Summary MRA thanks the Legal and Constitutional Affairs Committee of the Commonwealth Senate for the opportunity to comment on the Copyright Amendment (Online Infringement) Bill 2015 (Cth) (the Bill). MRA strongly supports the Government's introduction of a specific injunction to disable access to an infringing online location, which is not dependent on establishing a carriage service provider's liability for copyright infringement or authorisation of copyright infringement. While recognising the Government’s desire to ensure that the new section 115A addresses a specific problem, MRA has concerns that the provisions, as currently drafted, will not enable the proposed injunction to operate as a truly effective and efficient means of preventing online copyright infringement. In particular, MRA submits that the prerequisites which must be met before an injunction is granted should not be more onerous than those which apply in other jurisdictions where a similar remedy is available, and that the Courts' discretion to grant the injunction in any given case should not be unnecessarily fettered by an overly prescriptive set of factors which the Court must take into account. 3 Why Australia needs an injunction to disable access to infringing online locations The scale and reach of websites, streaming services and other online locations which infringe or facilitate the infringement of copyright is undoubtedly a global problem from which Australia is not immune. The IFPI Digital Music Report 2015 estimates that 20 per cent of fixed- line internet users worldwide regularly access services offering copyright infringing music3. “IFPI estimates that in 2014 there were four billion music downloads via BitTorrent alone, the vast majority of which were infringing, and this does not take into account other channels such as cyber lockers, linking sites and social networks”4. In March and April 2015, MRA reviewed the top five sites which stream illegal content or make it available for download as identified in TorrentFreak’s most popular torrent websites 20155 and, using the ARIA Australian Album chart and the ARIA Australian Artists Singles chart as guides, took snapshots of those sites and found the following Australian artists’ music on each of the sites (see Annexure A). All of the artists’ music made available on the illegal sites referred to in Annexure A was available to consumers on licensed online music services or in music stores. In Australia, there are over 30 online licensed music services which offer music to consumers where, when and how they wish to experience it, at a range of price points including free on some advertising supported services.6 1 See www.apraamcos.com.au. 2 See www.aria.com.au. 3 IFPI Digital Music Report 2015 p38 4 ibid 54 Vanibid Der Sar, Ernesto.Top Most Popular Torrent Sites of 2015 , TorrentFreak, https://torrentfreak.com/top-popular-torrent-sites- 5 Van Der Sar, Ernesto.Top Most Popular Torrent Sites of 2015 , TorrentFreak, https://torrentfreak.com/top-popular-torrent-sites- 2015-150104 6 www.digialcontentguide.com.au; www.pro-music.org. page 2 Licensed music is available to consumers any way they wish to experience it, yet sites like The Pirate Bay and KickassTorrents continue to operate and offer music for which they are not licensed. Those sites generate money for their operators from the advertising which appears on them. A study in 2014 titled Good Money Gone Bad: Digital Thieves and the Hijacking of the Online Ad Business, by the Digital Citizens Alliance, found that the top 30 sites in the US which stream illegal content, or make it available for download, made on average USD4.4 million each year and the illegal sites reviewed as a part of the study made USD227 million in revenue.7 The Government has recognised that there are obvious difficulties with taking direct enforcement actions against individual infringers and with taking direct enforcement actions against infringing online locations. These difficulties not only arise when the online location is operated outside Australia (as the Explanatory Memorandum to the Bill acknowledges) but also where the operator of the online location cannot be identified or located despite reasonable efforts, and where the conduct of the online location may fall short of "authorisation" of copyright infringement but nevertheless would constitute "facilitation" of copyright infringement (e.g. where the online location provides programs or other tools that facilitate the infringement of copyright but does not directly provide access to infringing content). More efficient and cost-effective mechanisms for addressing the problem of online copyright infringement are clearly needed. Orders requiring intermediaries to block access to infringing online locations, if properly implemented are becoming a widely accepted means of addressing both current infringements and stemming future infringements. Website blocking orders of the type proposed under section 115A are already available in a large number of jurisdictions around the world. Annexure B lists the corresponding legislative provisions in the United Kingdom, Singapore, Ireland, Norway and Austria. A separate table in Annexure B lists the corresponding legislative provisions in Italy, France and Spain. The international experience has demonstrated the effectiveness of such orders. As the IFPI Digital Music Report 20158 reports: “Action by ISPs to block users’ access to copyright infringing websites has become an increasingly accepted way of effectively helping to tackle digital piracy. ISPs in 19 countries have been ordered to block access to more than 480 copyright infringing websites…. Website blocking has proved effective where applied. While blocking an individual site does not have a significant impact on overall traffic to unlicensed services, once a number of leading sites are blocked then there is a major impact. In the three years since The Pirate Bay and numerous other sites were blocked in the UK there has been a 45 per cent decline (from 20.4m in April 2012 to 11.2m in April 2014) in visitors from the UK to all BitTorrent sites, whether blocked by ISPs or not. In Italy , where courts have ordered the blocking of 24 BitTorrent sites , there has been a decline of 25.6 per cent in the number of overall BitTorrent downloads in the country in two years from January 2013”. 4 Threshold limitations MRA recognises that the decision to grant an injunction in any particular case needs to balance the interests of all stakeholders, but is concerned that section 115A as currently drafted imposes a number of threshold limitations which may have unintended consequences and prevent the relief being as effective as it has proved elsewhere. 7 Digital Citizens Alliance, http://www.digitalcitizensalliance.org/cac/alliance/content.aspx?page=FollowTheProfit. 8IFPI, Digital Music Report 2015 p 39. page 3 4.1 The primary purpose to infringe, or to facilitate the infringement of, copyright Proposed section 115A(1)(c) requires rights holders to prove that the primary purpose of the online location is to infringe, or to facilitate the infringement of copyright. MRA submits that it would be extremely difficult in practice for rights holders to meet the threshold in respect of any particular online location. It is conceivable, for instance, that an online location may develop or adjust its business model and practices so that while it continues to engage in serious and extensive copyright infringement (or the facilitation of such) it also engages in a sufficient amount of legitimate business (such as the sharing of a small quantity of non-infringing content) so that it would not fall within the scope of section 115A. While the same wording exists in the corresponding Singaporean legislation, there whether the primary purpose of the online location is to commit or facilitate copyright infringement is only one of the matters the court is to have regard to and to give such weight as it considers appropriate, not a prerequisite to obtaining the injunction (see Annexure B). The requirement does not apply in any of the other jurisdictions which are referred to in Annexure B. It is worth considering that, had an application for an injunction been brought under section 115A in relation to the website MP3s4FREE.COM which was the subject of Cooper v Universal Music Australia Pty Ltd9, the condition precedent in section 115A(1)(c) would not have been satisfied, as the Court found that it only had "a principal purpose" of enabling infringing copies of the downloaded sound recordings to be made. Therefore the Court would not have been empowered to block access to the website under section 115A, although it was able to make orders restraining the ongoing operation of the website under section 115(2).

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