The recent and rapid development of internationalization and information technologies is making an increasing number of people concerned and interested in copyright issues, and an increasing number of books on the outline of the Copyright Law and copyright systems are being published by various publishers and organizations.
Such books are widely used by a number of experts and practitioners working on copyright businesses in general, however, one should pay attention to the fact that not only such experts but also many other people now need knowledge and information on copyright rules. Some of them say, for example, "I now need to learn just this point and aspect of the copyright rule rather than every corner of the copyright legislation and system." Some others say, "I would like to know the relationship between copyright and my business." This means that new types of introductory and explanatory booklets are needed, which possibly take a different approach to copyright rules and knowledge from the pre-existing copyright books.
The Copyright Research & Information Center (CRIC) planned to publish a series of booklets on case studies with a view to responding to such needs. This booklet is the first Volume of such booklets first published in March 1993 and revised continually, which was targeting formal education teachers who need some knowledge of copyright rules relevant to teaching practices.
The booklets of this Case Study Series are continually published every year, so far up to Volume 3, taking up various issues and aspect of copyright systems, cooperating with relevant experts and the JCO (Japan Copyright Office) of the Government. We do hope that the present booklet will contribute to the further development of copyright systems through the understanding of the private recording compensation system.
CRIC (Copyright Research & Information Center)
TABLE OF CONTENTS
- Q1. What is the system to collect and allocate compensation for private recording of music, broadcast, etc.?
- Q2. Is the interest of the right owner damaged even if the copy maid by private recording is not sold?
- Q3. For which things should compensation for private recording be paid?
- Q4. How and to whom should compensation for private recording be paid?
- Q5. How is the amount of compensation for private recording fixed?
- Q6. How is the collected compensation for private recording distributed?
- Q7. What are the common purpose activities to be paid by part of the collected compensation for private recording?
- Q8. Will the diffusion of copy guard system make compensation for private recording unnecessary soon?
- Q9. In which countries is compensation for private recording collected?
- Q10. Should compensation for private recording be paid for the recording of overseas films and music?
- Q11. Will the compensation already paid be reimbursed if the designated recording machine and/or designated recording medium were not used for private recording?
- Q12. What are the functions and activities of "sarah" and "SARVH"?
| Q1. | What is the system to collect and allocate compensation for private recording of music, broadcast, etc.? |
Answer
The major part of the Copyright Law of Japan was amended in 1970 and its Article 30 just after the amendment simply provided for that the reproduction of such works as music and movie for private use was permissible without authorization of the copyright owner or any payment at all.
However, the rapid development and diffusion of various audio/audiovisual recording machines and media (tape, CD, etc.) has made private recording for entertainment at home prevail widely, and such a way of use has become one of the major ways of exploitation of works. Moreover, thanks to the technological development in terms of digital recording machines, it is now possible to make digital copies of much higher quality than those of analogue format, which has created a new situation that a big amount of copied goods identical to the originals are created daily all through the society.
This lead to an argument that the exception in the Copyright Law in terms of private recording, by which compensation was not obligatory, had been unreasonably prejudicing the legitimate interests of copyright owners, performers and phonogram producers. Responding to such an argument, the Copyright Council of the JCO (Japan Copyright Office) of the Government's Agency for Cultural Affairs started discussions on this issue and reached a conclusion that, while the exception of private recording should be maintained, a new levy system should be introduced so that the economic damages of right owners be compensated for. Based on this proposal the Copyright Law was amended in December 1992, introducing a new private audio/visual recording compensation system, and the system was started in June 1993 for audio recording compensation and in July 1999 for visual recording compensation.
The outline of the private recording compensation system is as follows:
| (1) | Any person who, for the purpose of private use, makes sound or visual recording on such a digital recording medium as specified by Cabinet Order (specified recording medium) by means of such a digital recording machine as specified by Cabinet Order (specified recording machine) should pay a reasonable amount of private audio/visual recording compensation to the right owner (relevant copyright owner, performer and phonogram producer). (see Q3) |
| (2) | The right to claim private recording compensation should be exercised by the intermediary of the designated association, which is designated by the Commissioner of the Agency for Cultural Affairs. (see Q12) |
| (3) | The special mechanism by which the designated association collects the compensation should be that a) the manufacturer or importer of a specified recording machine or a specified recording medium adds a lump-sum private recording compensation to its price; b) the initial purchaser of such a specified recording machine or a specified recording medium pays the recording compensation at the time of the purchase; and c) the designated association receives the compensation from the manufacturer and importer. (see Q4) |
| (4) | The amount of private recording compensation claimed by the designated association should be approved by the Commissioner of the Agency for Cultural Affairs. (see Q5) |
| (5) | The private recording compensation collected by the designated association should be distributed to the relevant right owners through the association which each right owner belongs to (see Q6); also, the amount corresponding to the rate fixed by the relevant Cabinet Order (20%) of the collected private recording compensation should be allocated for such activities as those contributing to copyright education, which are commonly meaningful to all right owners (common purpose activities).(see Q7) |
| (6) | Any person who has paid private recording compensation may claim its reimbursement from the designated association, by certifying that he/she uses such a specified recording machine or medium exclusively for the purpose other than that of private recording of copyrighted music or moving images. (see Q11) |
[The Remuneration System]
| Q2. | Is the interest of the right owner damaged even if the copy maid by private recording is not sold? |
Answer
The present Copyright Law was established in 1970, in which devices for private recording were scarcely found except for large open-reel tape recorders. Although copyright owners were granted the right to authorize the act of reproduction including private recording, as such private recording was not widely done and was not considered a serious problem to immediately damage the interests of copyright owners, if it was carried in a limited site such as a household, Article 30 of the new Copyright Law provided for that reproduction (audio/audiovisual recording) for private use should be permissible without authorization of or payment to the relevant right owner.
However, as the result of the remarkable development and improvement of recording devices, private recording started to be done much more easily and frequently, which lead to an unexpected increase in copies produced by private recording, and moreover, the advent of multi-function and high-performance digital recording equipments made it possible to create so-called clone audio and audiovisual copies of such products as music CDs and DVDs by private recording at home.
Although private recording is usually done on a small scale within a household, the total amount of the copies produced in a society as a whole reached the level that unreasonably prejudices the interests of copyright owners.
Such a new situation made it necessary to compensate the copyright owners for the damages caused by private recording, and therefore, the Copyright Law was amended in 1992 to partly amend the former exception of private recording and, while keeping the legal system to allow unauthorized recording for private use, to establish a new system of compensation. This newly established system was the private recording compensation system.
The Copyright Law allows private recording as an exception under the condition that it is done "for the purpose of his personal use, family use or other similar uses within a limited circle". Therefore, it is out of the scope of this exception and constitutes infringement of copyright to, for example, produce a large number of copies to distribute to the public or to transmit the work through the Internet.
| Q3. | For which things should compensation for private recording be paid? |
Answer
The private recording compensation should be paid at the purchase of the specified digital audio and visual recording machines and media, which are limited to those widely used in ordinary households.
In theory, digital and analogue formats do not have to be distinguished from each other from the viewpoint of the exploitation of works. However, the private recording by digital format is far better than analogue format in terms of the quality, and therefore, can make exactly the same copy as the original sound and/or image without degradation of quality, which leads to much more serious damages to the economic interests of the relevant right owners. Also, recording machines and media of analogue format have already been sold and used widely in a number of households, and any new levy system would have caused serious problems and confusion among the users. Considering those aspects, the specified machines and media covered by the compensation system were limited to those of digital format, and therefore, the compensation for private recording does not have to be paid for analogue machines or media.
The concrete types of the machines and media are designated by the relevant Cabinet Order, and those designated up to the present are the following: (as of March 31, 2010)
○Digital Audio Recording Machines
| - | DAT (Digital Audio Tape Recorder) |
| - | DCC (Digital Compact Cassette Recorder) |
| - | MD (Mini Disc Recorder) |
| - | CD-R (Compact Disc Recordable Recorder) |
| - | CD-RW (Compact Disc Rewritable Recorder) |
○Digital Audio Recording Media
| - | DAT (Digital Audio Tape) |
| - | DCC (Digital Compact Cassette) |
| - | MD (Mini Disc) |
| - | CD-R (Compact Disc Recordable) |
| - | CD-RW (Compact Disc Rewritable) |
(note) CD-R and CD-RW for which the private recording compensation should be paid are limited to those with the indication of "For Audio".
○Digital Visual Recording Machines
| - | Blu-ray Recorder |
| - | DVD-RW (Digital Versatile Disc Rewritable) |
| - | DVD+RW (Digital Versatile Disc Rewritable) |
| - | DVD-RAM (Digital Versatile Disc Random Access Memory) |
| - | DVCR (Digital Video Cassette Recorder) |
| - | D-VHS (Data Video Home System) |
○Digital Visual Recording Media
| - | Blu-ray Disc |
| - | DVD-RW (Optical Disc) |
| - | DVD+RW (Optical Disc) |
| - | DVD-RAM (Optical Disc) |
| - | D-VHS (Magnetic Tape) |
| - | DV Cassette (Magnetic Tape) |
(note)
| i ) | Optical discs for which the private recording compensation should be paid are limited to those with the indication of "For Audio Recording" or "For Video". |
| ii ) | Digital video camera and its recording medium are not designated. |
Also, Article 30 of the Copyright Law provides for that (a) digital recording machines having special efficiency generally not for private use but for business use such as those for broadcasting, and (b) those having sound or visual recording functions incidental to the primary functions such as telephones with sound recording function are excluded from the scope of the designated digital machines and media.
| Q4. | How and to whom should compensation for private recording be paid? |
Answer
The private recording compensation should be paid, in theory, by each person who carries out private recording, making use of a specified digital machine and medium, each time he/she does so.
However, it is not practical at all for the person who makes a copy for private use to pay the private recording compensation to the right owner each time he/she makes a copy, and also, it is virtually impossible to find all such acts. Therefore, such an individual payment system would not work for the purpose.
The Copyright Law, therefore, provides for a special system of payment, considering the facility of both right owners and users, in order to realize the effectiveness and practicality of the compensation system.
The above-mentioned special payment system is to add the amount of the private recording compensation to the price of the machine/medium, with cooperation of the makers of the relevant machines and media, so that anyone who uses such a machine or medium pays the compensation only once at the time of the purchase.
The private recording compensation should be claimed and collected only by the association which was designated by the Commissioner of the Agency for Cultural Affairs, and all the rights of a number of right owners to receive the compensation are managed in a centralized way.
The Commissioner so far has designated two associations for both audio and visual private recording respectively: "sarah" (a public-interests corporate) for audio recording and "SARVH" (a public-interests corporate) for visual recording. These associations have been carrying our similar activities for the claim, collection, allocation, etc. of the private recording compensation. (see Q.12)
| Q5. | How is the amount of compensation for private recording fixed? |
Answer
The designated associations take charge of the collective management of the right to receive the private recording compensation which is collected from great many purchasers of the specified machines and media, and therefore, the amount of compensation should be set appropriately. With a view to ensuring the appropriateness of the amount, the designated associations are to obtain the approval from the Commissioner of the Agency for Cultural Affairs to fix it.
Also, the Copyright Law provides for that when the Commissioner of the Agency for Cultural Affairs approves the amount of the compensation it should be appropriate by taking into account the ordinary rate of sound or visual recording royalty and all the other factors as the act of recording takes place within a household for private purposes.
The concrete process to determine the amount or the compensation is as follows:
| (1) | The designated association offers a draft amount of the compensation to relevant organizations of such firms as the makers of the specified machines and media, listens to opinions of such organizations, and applies for the approval of the Commissioner of the Agency for Cultural Affairs. |
| (2) | The Commissioner of the Agency for Cultural Affairs consults the Culture Council (Copyright Sub-council). |
| (3) | The Commissioner of the Agency for Cultural Affairs approves the amount based on the conclusion of the Culture Council. |
○Compensation for Private Audio Recording
| - | designated machines (standard price indicated in the catalogue × 65%) × 2% [maximum: ¥ 1000] |
| - | designated media (standard price indicated in the catalogue × 50%) × 3% |
○Compensation for Private Visual Recording
| - | designated machines (standard price indicated in the catalogue × 65%) × 1% [maximum: ¥ 1000] |
| - | designated media (standard price indicated in the catalogue × 50%) × 1% |
| Q6. | How is the collected compensation for private recording distributed? |
Answer
As the compensation for private recording is collected to compensate for economic damages of relevant right owners caused by private recording within households, the collected money should be distributed to the right owners.
The distribution of the collected compensation is carried out by the designated association based on its "Distribution Rule", which is reported beforehand to the Commissioner of the Agency for Cultural Affairs.
As each act of private recording cannot be recorded, the concrete amounts of the money to be distributed to right owners are calculated based on the data which are prepared through such statistical surveys, corresponding to the categories of works and products and trying to make as precise data as possible, as the sampling of broadcasting and rental, the production records of CDs, the ownership of audiovisual works, and the questionnaires to relevant users. The collected compensation is distributed to the relevant right owners based on the statistical data through the association/organization which each right owner belongs to.
Not all the collected compensation is allocated to the relevant right owners but a part (20%) of it is spent for the activities which are for special purposes commonly shared by right owners. (see Q7)
Also, the collected compensation is to be paid to the right owners who do not belong to any association or organization.
| Q7. | What are the common purpose activities to be paid by part of the collected compensation for private recording? |
Answer
It is an obligation of the designated associations under the Copyright Law to use a part of the collected compensation for private recording to carry out the activities which are for commonly meaningful purposes shared by right owners, which is an exception of the distribution of the collected compensation.
The designated associations therefore receive the compensation collectively regardless of which works, performances or phonograms are recorded how often. Also, the collected compensation is to be distributed to each right owner through the relevant association/organization which he/she belongs to, however, it is virtually impossible to pay the money to all the right owners with 100% accuracy even if maximum statistical efforts are made in collecting and preparing the data.
Therefore, it was envisaged that a part of the collected compensation is to be used for special purposes so that the interests of all the relevant right owners, including those who were not the members of relevant societies/organizations, should be augmented by spending a part of the money for specific activities. Such specific activities are called "common purpose activities" as they are those for commonly beneficial and meaningful purposes shared by all the right owners.
Similar systems are adopted in almost all the countries which have adopted a legal system of compensation for private recording.
The Copyright Law provides for that the rate of the amount allocated for the common purpose activities should be 20% or less, and the relevant Cabinet Order stipulates that the rate should be 20%. This money is called the Common Purpose Fund.
The Common Purpose Fund is spent for the following four fields:
| (1) | public awareness and research of copyright systems or aid for such activities |
| (2) | promotion and diffusion of the creation of works or aid for such activities |
| (3) | international cooperation for the protection of copyright and neighboring rights or aid for such activities |
| (4) | research of technological measures to protect copyright and neighboring rights to cope with the development of digital audio/visual recording machines/media or aid for such activities |
The two designated associations, sarah and SARVH, annually develop concrete contents and methods of these activities based on the purpose and nature of this system, however, they are so far focusing on the activities included in above (1) so that the users as well as the general public may understand the system as much as possible.
Similar systems are adopted in almost all the countries which have adopted a legal system of compensation for private recording.
| Q8. | Will the diffusion of copy guard system make compensation for private recording unnecessary soon? |
Answer
Among the specified digital machines and media, audio recording products are equipped with the SCMS (Serial Copy Management System: an international technological format to limit digital reproduction only to the first generation and prevent any second generation copy), and visual products are equipped with devices of the CGMS (Copy Generation Management System: a technological format by which the producer may choose among (1) no copy, (2) only the first generation copy, and (3) copy free).
These technological measures are adopted because, while the quality of analogue copies degrades along with the generation of copies, digital reproduction can make perfect copies identical to the original unlimitedly regardless of generation, and therefore, it is intended to prevent continuous reproduction, i.e. copies of copies, which causes serious damages on the interests of right owners by making use of technologies.
Taking into account the recent rapid development of digital technologies, both of the technologies, it was envisaged that further efforts and improvement of the system were needed. Therefore, starting from April 5th, 2004, new technological measures were adopted in the programs of digital satellite/terrestrial broadcasting so that the reproduction (fixation) of such programs would be done only once (Copy-Once System). However, as this new system caused a lot of criticism from a number of broadcasting receivers, this Copy-Once System was replaced by a new Dabbing-Ten System. In the new system, a broadcasting program received and stored in a hard disc can be copied in a DVD or a blue ray disc up to ten times, and just after the tenth reproduction the copy in the hard disc is deleted automatically. This system functions only in receiving/recording devices designed for the Dubbing-Ten System. (see the website of the Digital Broadcasting Promotion Association:)
The specified products will to be equipped with SCMS and CGMS in Japan, however, even after the equipment of such devices and the adoption of the Dabbing-Ten System, private recording is still possible, and therefore, the compensation system should be paid.
The exception/limitation for private recording within a household may be sustained under the condition that an appropriate balance is ensured between the convenience for users thanks to the development of reproduction technologies and the compensation for the damages of right owners. The system of compensation for private recording is, in this sense, for the coordination between the interests of users and right owners to solve this problem.
With a view to developing the compensation system, further research on the development of relevant technologies seems to be needed so that a harmonization between culture and technology is ensured and appropriate measures to respond to social changes are planned.
Also, sarah and SARVH are carrying out research activities on technological measures to cope with the development of digital audio recording machines and media as one of their common purpose activities.
| Q9. | In which countries is compensation for private recording collected? |
Answer
The issue of private recording has been discussed in a number of countries in the world as a serious problem in terms of the appropriate balance between the development/use of information technologies and the protection of copyright, which is the basis for the promotion of culture.
It is Germany that first established a system of compensation (granting a new remuneration right), in which the purchasers of relevant recording machines/media should pay a lump-sum levy at the time of the purchase, and the number of the countries which have introduced a similar system amounts 28 (as of March 2010).
Therefore, the establishment of a compensation system has now become an internationally shared trend to cope with the problem of private recording within the framework of copyright protection.
[list of the countries which have a private recording compensation system]
Iceland, the United States, Italy, Estonia, Austria, the Netherland, Canada, Greece, Croatia, Congo, Switzerland, Sweden, Spain, Slovakia, Slovenia, Czech, Denmark, Germany, Japan, Norway, Latvia, Lithuania, Hungary, Finland, France, Belgium, Poland, Portugal.(US/Canada: only for audio recording)
| Q10. | Should compensation for private recording be paid for the recording of overseas films and music? |
Answer
As such works as music and movies are used internationally across the boarder, a number of countries in the world have established some treaties to protect works on a mutual basis.
They include, for example, the Berne Convention, the Universal Convention of Copyright, the TRIPS Agreement (of the WTO : World Trade Organization) and the WCT, and Japan has acceded to all of them, establishing treaty relations with the majority of countries in the world.
One of the most important principles of such treaties is national treatment, which means that a contracting state of a treaty should provide foreign right owners with no less protection than that granted to its nationals.
Also, copyright treaties include such treaties for the protection of neighboring rights as the Rome Convention, the Phonogram Convention, the TRIPS Agreement and the WPPT. These treaties also provide for the obligation of national treatment.
The system of compensation for private recording, which is based on the right of reproduction provided for in the Copyright Law and relevant treaties, is also subject to the obligation of national treatment, and therefore, the foreign right owners of the works, performance and phonograms protected in Japan also have the right to receive to compensation. Therefore, the collected compensation is to be allocated also to foreign right owners.
| Q11. | Will the compensation already paid be reimbursed if the designated recording machine and/or designated recording medium were not used for private recording? |
Answer
The compensation for private recording should be paid, in principle, each time the individual user carries out private recording, making use of a specified machine and a media. However, as such a payment system would be unrealistic, another special system was adopted, in which the payment of the compensation is done only once at the time of the purchase of the specified machines and media so that the amount of compensation for each purchase. (see Q1 and Q4)
This system, the aim of which was to realize a simplified mechanism to collect the compensation, was envisaged based on the idea that the purchase of the specified machines and media was highly related to the act of private recording and those who bought such machines and media were likely to carry out private recording.
However, if the purchaser of a specified machine or a medium, who has already paid the compensation at the time of its purchase, does not carry out private recording at all, it means that there is no basis to collect the money, and therefore, he/she may claim for the reimbursement of the compensation. Some typical examples of the cases for which such reimbursement is possible are: <1> the machine and medium are used only for the reproduction explicitly stipulated in the Copyright Law as an exception, which is therefore not covered by copyright of the author (e.g. educational use at school); <2> they are used only for the reproduction authorized by the right owners; and <3> they are used only for the reproduction of the works which are not protected by the Copyright Law.
It should be, however, proved that the machine and medium have never been used for the reproduction of audio/audiovisual works rather than they happen to have been used for such exceptional purposes as above just for several times.
The reimbursement of the compensation should be claimed to sarah or SARVH and the claim should be submitted, based on the relevant provisions of the Copyright Law, together with evidence to prove that the machine or the medium is never used for private recording, the receipt of the purchase, etc. When the claim is done properly, the relevant association will pay back the compensation.
For possible claims for the reimbursement, sarah and SARVH have established a committee respectively so that the procedure of the reimbursement is carried out appropriately. The judgment by the committee on whether the compensation should be reimbursed is made based on the reimbursement rule of each association, taking into account such various factors as the purchaser, the nature of the use and so on.
| Q12. | What are the functions and activities of "sarah" and "SARVH"? |
Answer
After the system of compensation for private recording was established, sarah (for audio recording) and SARVH (for visual recording) were designated by the Commissioner of the Agency for Cultural Affairs and started management and relevant activities as follows:
| (1) | the collection of compensation from the purchasers with the cooperation of the producers of the designated machines and media as well as the distribution of the collected compensation to right owners by such obligatory activities as:
|
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| (2) | the planning and implementation of common purpose activities (activities to augment common interests of right owners because of their significance commonly shared by all right owners) such as:
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Some data of sarah and SARVH are as follow:
[sarah]
|
[SARVH]
|