Newsletter
DRAFT AMENDMENTS TO COPYRIGHT INTERMEDIARY ORGANIZATION ACT
To take account of the amendments to the Copyright Law made on 12 November 2001, and the entry into force of the Law of Administrative Proceedings on 1 January 2001, the Intellectual Property Office (IPO) recently announced draft amendments to the Copyright Intermediary Or-ganization act. The main points of the proposed amendments are as follows:
The IPO was set up on 26 January 1999, after the Organic Statute of the Intellectual Property Of-fice, Ministry of Economic Affairs took effect on 4 November 1998. On 12 November 2001, Ar-ticle 2 of the Copyright Law was amended to read: "The competent authority under this Law is the Ministry of Economic Affairs. The Ministry of Economic Affairs shall set up a specialized agency to handle matters under the preceding paragraph." Amendments are proposed to bring the statute into line with the above changes.
Under the amended Article 81 Paragraph 2 of the Copyright Law, exclusive licensees may also join copyright intermediary organizations. In line with this change, the act will be amended to also extend qualification for membership of in-termediary organizations to exclusive licensees.
Under the amended Article 81 Paragraph 1 of the Copyright Law, only economic rights holders may set up an intermediary organization; an ex-clusive licensee cannot be a promoter of such an organization. The act will be amended to the same effect.
Because the provision authorizing the review of royalty rates set by copyright intermediary or-ganizations, formerly contained in Article 82 Paragraph 1 Item 1 (latter part) of the Copyright Law, has been repealed, the provisions on such review will also be removed from the act.
1.The current Article 7 of the act defines circumstances under which the competent authority should refuse an application for approval to establish a copyright interme-diary organization. But it makes no provi-sion regarding the consequence if a situa-tion calling for a refusal is discovered after approval has been granted and the inter-mediary organization has been established. Therefore, a new provision allows the competent authority to revoke an approval granted if reasons for not granting the ap-proval are subsequently discovered.
2.As currently worded, the act requires the competent authority to revoke its approval for the establishment of a copyright inter-mediary organization if the organization fails to register its incorporation within six months after receiving approval. The Chinese term used for "revoke" is chexiao. However, in the language adopted by the Law of Administrative Proceedings, chex-iao properly refers to the annulment of an administrative disposition that was unlaw-ful when first made. This is distinguished from feizhi ("cancel"), which refers to the invalidation of a disposition that was ini-tially lawful. Therefore chexiao will be amended to feizhi, to unify the terminology with that of the Law of Administrative Proceedings.
3.In the existing act, the circumstances under which the competent authority must order the dissolution of an intermediary organi-zation fall into two kinds: those where the original approval is annulled (chexiao), and those where it is canceled (feizhi). To make the distinction clear, the proposed amend-ment states that where approval for an in-termediary organization is annulled or canceled, the competent authority should also order the organization's dissolution, give written notice of the order, stating the reasons, to the competent district court and to the intermediary organization concerned, and publish the decision in the government gazette.
The compilation of catalogues of economic rights in copyright works is intended to aid users in understanding the scope of the copyright works managed by intermediary organizations when negotiating with them for licenses to use such works. In practice, intermediary organiza-tions have also used "lists of economic right holders," rather than catalogues of economic rights, as a method of making public the scope of the works managed by them. However, the current act does not define the required content of such lists. Also, in practice authors are often unable to remember the year in which the work was completed or first published when it lies in the distant past, and verification may not be easy. Further, the "economic rights licensed for use" can be known from the licensing agreement concluded between the user and the intermediary organization, or from the schedule of royalty rates drawn up by the intermediary organization. The provisions regarding catalogues of eco-nomic rights will be amended to address these issues.