COMPULSORY LICENSING UNDER THE INDIAN

COPYRIGHT ACT

T.G.Agitha

Indian copyright law provisions

Section 31 (1) (a) – General provision – validity to be tested with the three-step test

Section 31 (1) (b) – based on Berne 11bis (2)

Section 31 A – Section 32 – Based on Berne Appendix

Article II Section 32 A - Based on Berne Appendix

Article III Section 32 B - Based on Berne Appendix

Article IV

International mandate

Article 9 (2) of the Berne Convention (B.C.)

Article 11bis (2) of the (B.C.) Article 13 of the TRIPS Agreement TRIPS also incorporate articles 1-21 of

the B.C and the appendix thereto. (including the Berne acquis and not simply the individual provisions as stated by the WTO panel in WT/DS 160)

Article 9 (2) of the Berne Convention

Laid down the three-step at Stockholm Conference 1967

Before that national legislators enjoyed discretionary power to lay down limitations

9 (2) brought in restrictions on this discretionary power by introducing three step test

Three-step test – B.C.- Art. 9 (2)

A limitation/compulsory license with respect to the exclusive right of reproduction is valid only if it is limited to Certain special cases Provided that such reproduction does not conflict

with the normal exploitation of the work of the author and

does not unreasonably prejudice the legitimate interests of the author

A flexible interpretation of this provision can make the C.L. under this provision more useful

Interpretation of Three-Step Test

Certain special cases policy objectives of national legislator has to be taken

into account – WTO panel decision is not acceptable No conflict with normal exploitation

Not all exploitation, but ‘normal’ exploitation – there is a conflict only when there is a substantial market impairment . Markets that are neither developed, nor licensed to develop, will then fall beyond the scope of this

Do not unreasonably prejudice with the legitimate exploitation Kingpin – balancing public and individual interests

Compulsory license - permissibility under three-step test

India opposed introduction of three-step test -demanded compulsory general license similar to Article 11bis (2) B.C for the educational and cultural development of newly independent colonies like India

Compulsory general licensing – granting of C.L of already published works on two simple conditions: 1) refusal to grant license by author/owner, 2) payment of compensation fixed by competent authority

India feared that three-step test may restrict compulsory licensing scope

Compulsory license - permissibility under three-step test

India’s demand was rejected, but open-ended three-step test was accepted as a compromise formula

No explicit reference to compulsory license But it was accepted among the members that

compulsory licensing is permissible under the third step

preparatory documents and the commentators concurred that the ‘harm’ may be rendered “reasonable” if the author is compensated including by means of compulsory license

Thus compulsory license formed part of Berne acquis of three-step provision

Vienna Convention on the Law of Teaties

As per Article 31 (1) of the Vienna Convention on the Law of Treaties (VCLT), a treaty has to be interpreted in accordance with the ordinary meaning to be given to the terms of the treaty in their context ....

Article 31.2 of the VCLT explains that context for the purpose of the interpretation of a treaty shall comprise, .....(a) any agreement relating to the treaty which was made between all the parties in connection with the conclusion of the treaty

Records of the Main Committee I reports of Stockholm Revision Conference reveals the presence of such an agreement

TRIPS Article 13 and compulsory license

While incorporating Article 1-21 B.C and Appendix the Berne Acquis and not just the individual provisions was incorporated (WTO panel decision)

Thus compulsory licensing available under article 9 (2) got recognized under article 13 of the TRIPS also

Berne Appendix Special provision for developing countries Available with respect to translation and

reproduction rights Irrational and troublesome procedures Total failure in reality Now developing countries need to go beyond

Berne Appendix it is paradoxical that now compulsory licensing

permissible under the third criterion of the three-step test is more attractive than the special provision for developing countries

Berne Appendix and Three-step test

Appendix Applicable to right of

reproduction and translation

Troublesome procedure Conditions like

withholding etc. are not applicable- simple condition- payment of compensation

Three-step Under TRIPS

coverage is extended

No troublesome procedures

Has to satisfy first two tests

Section 31 (1)(a) General provision Does not fall within the scope of the Berne

appendix (validity has to be tested against the three-step test)

But its application is limited to “Indian works” The only ground for issuing compulsory license

under it is “withholding the work from the public” It is paradoxical in view of the Indian position in

international negotiations demanding a provision assuring availability of foreign works at affordable rate for developing countries

Section 31 (1)(a) Needs to be extended to foreign

works and to cases of non-availability at affordable/reasonable price

Such expansion does not violate three-step test

Article 13 TRIPS and 31 (1)(a)

Present situation of withholding from public Is a special case as when the work is so

withheld no justification for copyright protection

No exploitation at all – no conflict with second criterion

There is payment of remuneration fixed by Copyright Board – no violation of third criterion

Article 13 TRIPS and 31 (1)(a)

If extended to foreign works Same logic applies as copyright protection is not

territorial in nature If extended to cases of non-availability of works

at affordable/reasonable price Still falls within “certain special case” as non-

availability at affordable price means no access No conflict with “normal exploitation” as the

consumers available under compulsory lisensing may not be available otherwise

Payment of compensation – no conflict with third step

Sections 32, 32 A, 32 B Based on Berne Appendix applicable only to right of reproduction

and right of translation Irrational and troublesome procedural

requirements

Sections 32, 32A and 32 B Conditions

Waiting period Grace period out dated works Strict stipulations with respect to

recording refusal by the copyright owner Risk of termination of license on the

author’s/owner’s entering into market himself.

Sections 32, 32 A, 32 B these provisions are not being utilized

by any one and not expected to be utilized also in view of the stringent/ irrational conditions attached to them

To be made useful need to be amended

This requires amendment of Berne Appendix

Criticism of 1983 Amendment

Knowing fully well the scope of compulsory license under article 9 (2), Berne, and the irrationality and non-utility of Berne Appendix, India opted for taking “benefit” from Berne Appendix rather than amending 31 (1) (a) to suit its demand raised in international negotiations from 1960 onwards

i.e. To make available works of developing countries at affordable price

India failed to practice what it preached in the international fora.

Article 11bis (2) and article 13 TRIPS

As rightly said by the WTO panel, and accepted by Ricketson there is a conflict between the two

The second step requirement goes against the purpose of Article 11 bis (2)

Unlike article 9 (2), article 11bis (2) confers more discretion on national legislation to impose conditions on broadcasting rights (only conditions are protection of moral rights of the author and payment of equitable remuneration)

Section 31 (1) (b) and article 13 TRIPS

Therefore Article 11bis (2) is not subjected to Article 13 TRIPS

If Article 11bis (2) is made subject to article 13 TRIPS, 11bis (2) can never serve its purpose

It is as good as TRIPS excluding Article 11bis (2) The mere inclusion of 11bis (2) while

incorporating article 1-21 B.C, leads to the conclusion that 13 does not cover 11bis (2)

Section 31 (1) (b) Is withholding from the public a condition,

or in other words, can a C.L. be issued when the work is available to the public?

Whether such C.L. could be issued to more than one person in view of section 31 (2) which states that when there are more complainants license has to be granted to the one who best serves the interests of the public?

Section 31 (1) (b) Based on 11bis (2) of the Berne convention Applicable to broadcasting right Conditions – prior publication, refusal to allow

communication to the public by broadcast on terms the complainant considers reasonable, payment of remuneration as fixed by Copyright Board

Reason behind such a provision – regulating industrial practices by restricting the monopolistic power of collective societies to control industry (though ultimate aim is benefit of general public)

Multiple licenses to promote competition is intended

Section 31 (1) (b) Different from 31 (1) (a) as withholding or

not is not the concern of the provision Promoting competition and avoidance of

monopolization is the real concern Indian courts failed to recognize its real

purpose of restricting monopoly and the need to regulate industrial practices

Recent Supreme Court decision

The court failed to take note of the absence of a requirement of “withholding from the public” in Section 31 (1) (b) and held that if voluntary licenses are given to some broadcasters, doors will be closed for others to approach Copyright Board

However, taking into account the “ground realities” (the number of broadcasters in India), it held that fixing unreasonable terms amounted to refusal of permission

it also held that Section 31 (1) (b) does not create an entitlement in favour of an individual broadcaster. But it left section 31 (2) uninterpreted and thus failed pay attention to the earlier Bombay High Court Judgment.

Conclusion India needs to take maximum use of the compulsory

licensing provision allowable under three-step test rather than relying more on the Berne Appendix

Thus section 31 (1) (a) needs to be amended bringing foreign works and situations of non-availability of works at affordable price within its scope

Section 31 (1) (b) also should be extended to foreign works as the only stipulation under Berne is that “the conditions apply only in the countries where they have been prescribed”

Conclusion Negotiations for amending Berne

Appendix to be strengthened The need of the day is not to scrap

compulsory licensing provision but to strengthen it

Thus violation of copyright could be prevented to a greater extent