Canada funded education cuts with writers’ royalties. It’s time to pay up

Fall Arts Guide | Gregory Beatty | Oct. 13, 2022

Going back to the early 1990s, Canada’s provincial ministries of education, school boards, universities and colleges had an arrangement with Access Copyright. The deal: they paid licensing fees for print materials such as book chapters and magazine/newspaper articles that teachers copied when they were assembling course packets for students.

That was done to satisfy the Copyright Act, which prohibits the unauthorized copying of creative materials. The money collected was distributed to registered creators and publishers as compensation.

The arrangement, which amounted to a levee of around $15 a student, provided crucial revenue for creators and publishers, while students (and teachers) benefited by having access to quality course materials.

Then, in 2012, the payments abruptly stopped.

The provincial parties justified the move under an exemption to copyright called “fair dealing”. On the surface, it seems like a stretch. Fair dealing is supposed to cover things like a magazine printing a small excerpt from a book in a book review, not the holus bolus copying of millions of pages a year. Somehow, that just doesn’t seem “fair”.

A 10-year legal battle ensued, which copyright advocates ultimately lost at the Supreme Court. The ruling, however, was nuanced, says John Degen, executive director of The Writers’ Union of Canada.

“Nothing in the decision suggests that ‘fair dealing’ for education extends to the systematic copying of published content for aggregation and delivery to students,” he says. “What the Supreme Court said was ‘We are the interpreters of the law. And the law is too vague, so if Parliament wants there to be licensing for education they have to state that in the law.”

Copyright advocates put the loss to Canada’s creative sector at $200 million so far. In an industry that already operates on razor-thin margins, it’s a tough blow.

And while provincial governments have tried to dress up the policy switch with high-minded ideals, the truth is much more basic, says Degen.

“There’s a lot of ideological talk on the education side that it’s all about access to information and cultural product,” he says. “But in my view, it’s never really been about that. It’s about saving money.

“We all know what is going on in education in terms of budgetary constraints,” says Degen. “Rather than find savings in obvious places such as administration, they decided to go after what I guess for them was low-hanging fruit.”

GLOBAL SLOWPOKE

When the licensing arrangement started in the early ’90s, most of the copyright infringement was done by photocopy. Now, many materials are online. Again, no one in the creative sector begrudges teachers and students access to up-to-date, diverse, and engaging course materials. But we do live in a capitalist society, and if creators and publishers are going to continue to produce those materials they need to be compensated.

“The cultural and creative sector has been expected to subsidize materials for education,” says Degen. “That’s completely unfair considering that educational material was an established market.”

This isn’t a CanCon thing, either. Many countries around the world have Access Copyright style agencies that collect licensing fees from the education sector and distribute them to creators and publishers.

“It’s really only Canada that’s an outlier in this,” says Degen. “And we’re only an outlier because the education budget-makers have pushed the envelope on what the Copyright Act says.”

The Copyright Act is administered by the federal government. Access Copyright and its plaintiff partners have been in discussions with the government since the early days of the dispute.

In 2018, the first-term federal Liberal government conducted a full review of the Copyright Act. Recommendations are slowly coming forward [see sidebar], and the “fair dealing” exemption for education is one of the issues being looked at, says Degen.

“The Heritage Committee produced a report on how to fix the problem,” says Degen. “The government is technically onside — during the last election they promised to fix it. The solution just hasn’t been delivered. A lot of our discussion with Ottawa is ‘Tick-tock, when is this going to happen?’ You recognize the problem, you know what the solution is, so crack open the act and make it clear education has to return to licensing content.”

One potential roadblock to bringing legislation forward, says Degen, could be Liberal Justice minister David Lametti who, prior to entering politics, was a noted anti-copyright scholar. Ultimately, though, the government’s hand may be forced by international trade and investment agreements.

One copyright change that is going forward, for instance, will increase the copyright term from 50 years after death of author to 70 years. That change comes courtesy of the 2020 U.S./Canada/Mexico trade agreement, where U.S. negotiators pressed for it.

“Canada has signed international agreements about protecting intellectual property and copyright,” says Degen. “The interpretation of fair dealing that happened in 2012, and the fact the federal government has just allowed this to continue, in our opinion, breaks those agreements.”

Meeting global standards on copyright would have a two-fold benefit. First, it would encourage creators and publishers from other countries to continue to invest in the Canadian market, something they may be reluctant to do without copyright protection. Degen points to Oxford University Press as one example of a major educational publisher that has pulled out of Canada.

The flipside of that is Canadian writers and publishers would have greater opportunity to earn income from international licensing agreements. For that to happen, Canada has to provide reciprocal protection to creators and publishers from other countries.

It’s more than a fair trade, says Degen.

“The Canadian writing and publishing industry has improved so much over the last few decades. It’s grown into this domestic powerhouse, it’s ready to get out into the world and grow even more. And just as we reach that level of prominence, we got our knees cut out from under us in our home market.”

When you consider Canada’s multicultural character and the growing strength of the Indigenous creative community, we are perfectly positioned to be a true global player in arts and culture.

“In 2021, Canada was the nation of honour at the Frankfurt Book Fair,” says Degen. “That was a huge moment of success for our book publishing industry. Spotlighted in all of that were Indigenous, Métis and Inuit authors. Their work is hugely attractive to world markets.”

For the federal government, the fix is simple, says Degen.

“All the architecture from the old arrangement is in place,” he says. “All it has to do is clarify that fair dealing for education does not apply if there is an established licensing structure and that tariffs set by the Copyright Board are mandatory if you’re using the material.

“That’s the missing piece right now. It’s the simplest thing in the world to do.” ■

Sidebar

Big Bucks, Starving Artists?

Name a profession where you can earn more money dead than alive.

Give up?

Consider visual artist. When artists start out and are largely unknown, they typically sell for low prices. If they stick with it and start to get attention from collectors and curators, their price goes up. A final bump comes when they die, because the supply of work is now capped. Then the marketplace takes over.

When artists rise to global fame, prices can reach millions of dollars. But the thing is, none of that goes to the artist (or their family). Instead, it goes to a wealthy collector who, under tax law, treats it as a capital gain — ugh!

That’s not to slam the collector. But considering the poverty many artists endure in their lives, it does seem a tad unfair that the person who actually made the work wouldn’t get a share of the bounty.

Turns out, many countries (over 100 to date) agree. To remedy the injustice, they’ve established what’s known as an artist’s resale right. France has had one for 100 years, and as part of its copyright review the federal government is considering one for Canada.

The proposal is that each time an artist’s work sells on the secondary market they (or their estate) get a five per cent royalty.

The resale right is the result of many years of work with the government, says April Britski, national director of CARFAC which represents visual artists in Canada.

“In countries where it works best, they have a copyright collecting agency that monitors the market and they contact auction houses and commercial galleries asking them to report on sales in the secondary market,” she says. “They handle the administration completely. They collect the royalties, then find the artists and pay them.”

Poverty isn’t an exaggeration to describe conditions artists live under, either. In Canada, the average artist income is around $20,000 — that’s from all sources too, including side-hustles they may have to support their art practice.

“In the UK they did a study on what artists use the royalty money for,” says Britski. “No surprise, people pay their rent. They buy art supplies.

“Remember too that there is no certainty an artist will get this,” she says. “Some people’s work doesn’t come back on the market. It’s just one of many potential income streams. For some people it might be a couple of hundred bucks a year, for others it could be thousands. And every little bit helps.”

As with the fair dealing issue in education, the government’s hand on artist resale rights could be forced by international trade and investment concerns.

“When Canada and the EU were working on a trade deal in 2011 the resale right was discussed,” says Britski. “At the time, it was assumed that Canada would adopt it, so European negotiators said ‘Okay, we don’t need to push for it.’ Then it didn’t happen.”

In the wake of Brexit, Canada is about to enter trade negotiations with the UK. The issue could come up there, says Britski.

“It did between UK and New Zealand,” says Britski. “That’s how New Zealand ended up committing to legislation that’s expected by 2024. Like us, they’d been talking about it for years. But that extra trade push is what made it actually happen. Canada could find itself in that situation as well.”

Again, as with creators and publishers in the licensing sector, visual artists stand to benefit beyond the domestic market, as they would then have reciprocal resale rights in secondary markets outside Canada.

While Canadians who support the arts don’t begrudge the public money that’s spent to sustain them, other Canadians do. The beauty with artist resale rights, says Britski, is that the royalties come from the commercial market.

“It wouldn’t cost the government anything,” she says. “It doesn’t require a funding program. They wouldn’t collect and distribute it. It would all be handled through the market.”

Britski says the government is planning further consultations this fall, with legislation possible next year.

“We’re hopeful the resale right will be there,” she says. “Although how long it would take to go through is hard to say. It depends on what other government priorities there are. But we’d be very pleased to see it.” /Greg Beatty