July 28, 2005 2:26 PM PDT

No iPod tax for Canada

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The Canadian Supreme Court won't hear a case involving extra fees for iPods and other MP3 players in that country, ending a dispute over a so-called iPod tax, but rekindling debate over the legality of file swapping.

At issue was a long-standing law that allows a regulatory agency to collect a small extra fee on blank media such as CDs and tapes, with the revenues going to artists and record labels to recompense them for the private copies being made of their work.

That agency, the Copyright Board of Canada, said in late 2003 that iPods and other hard-drive players were being used to copy music as well, and imposed a fee of up to $25 on the devices. An Appeals Court set aside that decision last year, and Thursday's Supreme Court action will leave iPods untaxed.

The decision may have broader implications for Canadian computer users, however.

The country's trade association for record labels quickly welcomed the Supreme Court's action as a sign that unauthorized file swapping was once again viewed as unambiguously illegal.

That connection stems from another court ruling, in which a judge said that trading files though a file swapping network appeared to be legal, citing the Copyright Board's fee regime.

But if copying files to hard drives--whether on an iPod or a computer--is not included in the private copying fees, then file swapping is no longer protected, executives at the Canadian Recording Industry Association said.

"For years, those supporting unauthorized file sharing have misleadingly used the existence of the Private Copying Levy to justify illegitimate file sharing," CRIA President Graham Henderson said in a statement. "Today, the Supreme Court says 'no such luck.'"

Copyright regulators said the Supreme Court's action was regrettable, and might even make most common uses of the iPod illegal.

"The clear result of this decision is that copying recorded music onto an iPod is illegal, unless the copying has been authorized by rights holders," said David Basskin, a director of the Canadian Private Copying Collective, which collects and distributes the fees on blank media, in a statement.

The CPPC would return the fees that had been collected from iPod and other digital audio device sales between December 2003 and December 2004, the group said.

The ambiguity in Canadian law may be resolved before the courts have much time to address file-swapping issues again, however. The Canadian government has introduced a wide-ranging new copyright law that is expected to definitively make trading copyright files online without permission illegal.

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Cowards
By failing to resolve this issue and bouncing this case, it leaves the CPCC, the future potential to bill a dollar a gigabyte tax on the sale of all computer hardrives irrespective of use due to the coming of the new home user friendly multimedia systems due to the ability of these machines to record high definition video in realtime and use standard computer harddrives! Cowards! For Canadian readers suggest you read C60, the new copyright act(or DMCA/Bono law on steroids) and you can see literally how many of rights are removed at the stroke of a pen, please complain loudly to all your local canadian politician, and organise opposition to same thankyou! Oh well, their goes the neigbourhood!
Posted by heystoopid (691 comments )
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Big Music Does Not Malke the LAw ann Should Not Second-Guess Implications
Big Music is clearly stretching a mile here by saying that because there is to be no Ipod tax that therefore file sharing is illegal because no levy covering it applies to the iPod.

In Canada, a copyright levy has been applied for several years to recordable media to cover home copying when the media is used for home copying. However, Organized Music has tended to argue every which way as to what the levy represents. Most of the time the levy is characterized by Big Music as a charge for illegal copying, implying it is a penalty for copying and not a permission to copy.

Other times, when convenient, the levy is implied as a permission, as in this instance where its absence is claimed as an absence of permission.

It was this two-toned rationalization of the levy that landed Organized Music in its legal pickle re the possibility that file sharing might be legal in the first place.

Let us be careful not to assume that the inconsistent "whatever fits the moment" assertions of Big Music in Canada represent what the Canuck Supreme Court shall ultimately rule on the issue.

Keep in mind that the Canadian media levy is meant to compensate for home recording, but it is not necessarily accurate to say that only those media that have a levy charge are cleared for copying to such media. This is because home copying in general is allowed, it would seem, not merely home copying only to those devices covered by a levy.

If one wants an accurate interpretation of the iPod levy situation, one should consult a neutral expert on copyright law in Canada. I suspect the actual situation is far from a done deal.
Posted by PolarUpgrade (103 comments )
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