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Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz
 
 A 
RIEL
K 
 ATZ
 
 A
SSOCIATE
P
ROFESSOR 
I
NNOVATION
C
HAIR 
,
 
E
LECTRONIC
C
OMMERCE
 
July 19, 2011
- BY EMAIL -
 Mr. Gilles McDougallSecretary GeneralThe Copyright Board of Canada56 Sparks Street, Suite 800Ottawa, OntarioK1A 0C9Dear Mr. McDougall,
Re: Reply to Access Copyright’s Submission Regarding the AUCC’s Application forAmending the Interim Tariff 
Pursuant to the Board’s notice from June 16, 2011, I wish to reply to Access Copyright’s (AC)submission regarding the AUCC’s application from June 8, 2011. As the Board will recall, inmy earlier submission of June 27, 2011 I shared many of the concerns that the AUCC raised inits application, and added a few others. Nevertheless, I was not persuaded that amending theInterim Tariff to require Access Copyright to grant transactional licenses on a per copy basis—asthe AUCC requests—would be the optimal remedy for these issues.After having the opportunity to carefully read AC’s submission, I wish to reaffirm the positionsfrom my previous submission. Nevertheless, there are a few points with which I agree with AC.I agree that the inclusion of digital licensing in the Interim Tariff does not reflect the status quothat prevailed until Dec. 31, 2011, and I agree that the AUCC’s proposed remedy, as it applies todigital copying, is inadequate. Therefore, I fully endorse AC’s position that “the Board should
 
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Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz
 
take a principled approach and simply remove the digital option altogether from the InterimTariff.”
1
The optimal solution at this interim stage would be to let Access Copyright continuedoing what it does best, namely administering a collective blanket license for the non-digitalreproduction of works under its repertoire, while ensuring that Institutions who do not wish tooperate under the Interim Tariff have a genuine option to secure transactional or other licensesdirectly from publishers or other market intermediaries. Removing the digital option from theInterim Tariff will be an important step in this direction. It will ensure greater fidelity to thestatus quo, and to a large extent might obviate the need for the Board to consider the morecomplicated issues that all parties raise in their respective submissions.If, however, the Board insists on keeping the digital option in the Interim Tariff, there is noescape from adequately addressing the developments that have occurred since the issuance of theInterim Tariff. Therefore, the rest of my submission will concentrate on these issues.In my previous submission, I dealt with three main issues: (a) what a non-mandatory tariff entails; (b) the abusive and anti-competitive nature of Access Copyright’s (and some of itsmembers’) alleged conduct; and (c) the appropriate remedy. Unfortunately, despite itsconsiderable length, AC’s submission contains very little substantive response to these issues. Inessence, AC’s submission boils down to four main themes:
•
 
“I didn’t do it”: flatly denying any wrongdoing without providing any evidence or theoryto refute the evidence-based allegations made against it;
•
 
“I’m entitled to do it”: maintaining that it and its affiliates are entitled to engage in theacts complained;
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“No-one can touch me”: asserting that the Board has no jurisdiction to regulate theseactivities and that they are also immune from scrutiny under the
Competition Act 
; and
•
 
“I’m a victim”: accusing everyone else of making false accusations and conspiringagainst it.
1
AC Submission, p. 2.
 
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Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz
 
These themes run through the various parts of AC’s submission. Individually, almost each andevery argument that AC raises lacks merit. Cumulatively, they only strengthen the case againstit.
I.
 
AC is estopped from arguing against the jurisdiction of the Board to mandatetransactional licensing
1.
 
The concern that if approved, the Interim Tariff would be mandatory has been fundamentalto most objectors’ opposition to its approval, including mine. Among other issues, Imaintained that a mandatory interim tariff could not be legally valid.2.
 
The Board responded to this concern by noting thatthe interim tariff we adopt in this matter is not mandatory. An Institution can avoid itsapplication by purchasing the work, negotiating a licence to copy the work with Accessor its affiliates, not using any work in the repertoire of Access or engaging only inconduct exempt from liability.
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 3.
 
The Board did not come to this conclusion out of thin air. Indeed, the Board relied directlyon AC’s submission and incorporated it almost verbatim into its decision. For instance, on p.6 of its Dec. 22, 2010 submission, AC stated the following:[A] concern is expressed that an interim tariff will be “mandatory”. Any institution canavoid application of the tariff by: (1) purchasing the work; (2) negotiating a licence withthe rightsholder to copy the work; (3) not using any work in Access Copyright’srepertoire; (4) by engaging in conduct exempt from liability, e.g., fair dealing; or (5)negotiating a licence with Access Copyright.4.
 
The essence of the AUCC complaint—backed by evidence—is that AC and some of itsaffiliates have taken steps to eliminate the option of avoiding the application of the InterimTariff, contrary to the express representation AC made to the Board, and contrary to theBoard’s ruling. AC’s opponents therefore ask the Board to make sure that these optionsremain available. Contrary to its previous representations, and to evidence before the Board,it now maintains that transactional license never truly existed, and goes further to argue thatthey should not exist. The Board should ignore these contentions.
2
Board’s Reasons, March 16, 2011, paragraph 50.
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