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In an important decision released last Friday, the Supreme Court of Canada recognized the right of all copyright owners to control the making available of their works for on-demand consumption over the internet.
The case SOCAN v Entertainment Software Association concerned the scope of protection afforded under Canadian copyright law when music, movies, and other content are made available to the public for on-demand streaming and download and considered the meaning of section 2.4(1.1) of the Copyright Act (sometimes called the “making available provision”). This provision came into force in 2012 and expanded the communication right in the Copyright Act to include the act of making content available on demand.
In the decision, the Supreme Court agreed with SOCAN that a work is communicated to the public as soon as it is made available for on-demand streaming, whether or not any stream actually occurs. The Court also made clear that making a work available for download engages the copyright owner’s exclusive right to authorize the reproduction of the work. Together, the two rights give copyright owners the ability to control the act of making their works available online, consistent with Canada’s obligations under international copyright treaties.
The Supreme Court further clarified that where a work is made available and then later streamed, those steps form one continuous, compensable act of communication. Therefore, although the Court decided that SOCAN could not collect a new, additional royalty for the initial step of making available, SOCAN will continue to collect performance royalties for the communication of a stream, which now clearly begins when the work is made available.
“Online platforms attract users and earn revenue by offering on-demand access to huge catalogues of music and other content,” said Jennifer Brown, CEO of SOCAN. “The decision confirms that rights holders are entitled to share in the value created from the moment their works are made available, and to take action immediately if their works are made available without their consent. The Supreme Court may have dismissed SOCAN’s appeal, but the decision is still an important affirmation of our members’ and clients’ rights.”
SOCAN will continue to work with its members, clients and other stakeholders to ensure that Canadian creators are fairly compensated for the use of their works.