by Bobby Amm. There has been much publicity and controversy recently around the new Copyright and Performers’ Protection Amendment Bills, which have already been approved by parliament and are now awaiting the signature of the president, Cyril Ramaphosa, before they become law.
Groups on both sides of the debate are vigorously lobbying the president’s office in an attempt to influence his final decision and to determine what happens next. At the moment, the big question is: will the bills be passed or will Ramaphosa send them back for additional impact assessment and redrafting?
Manifold and complex
The issues of contention contained within the two bills are manifold and complex, and they affect a wide variety of industries in South Africa, most significantly the creative industries. Coalition groups of authors, publishing houses, sound engineers, musicians, filmmakers, scriptwriters, actors and animators (among others) have been meeting with copyright lawyers and other experts to discuss the potential impact of the bills. The international community, which is seeking to increase investment in SA, has also voiced concerns that the bills limit the creative sector’s ability to protect their rights, thereby substantially weakening SA’s internal and export markets for creative content.
We at the CPA have been interested to find out how the bills in their current form will impact on the advertising sector, and have engaged with attorneys and lobbyists to establish just what’s at stake:
- Advertising agencies and clients, as owners of copyright, are more impacted by the new bills than production companies, which are essentially commissioned to make commercials but cede copyright once the commercial has been paid for in full.
- The copyright bill introduces the “fair use” principle to SA which, in effect, allows for the free use of copyrighted content. The concept comes from the US, where allowance is made in certain instances to circumvent copyright protections and republish or rebroadcast content; however, the SA application differs in that it omits the considerable punitive damages that US courts can implement in copyright infringement cases. As a result, there’s hardly any risk for local offenders, which will place all content at increased risk. Tech giants are encouraging these changes to legislation to enable free access to content that they currently have to pay for.
They aim to increase the “value gap”, which describes the growing mismatch between the value that some digital platforms (online user upload services such as You Tube) extract from content (films and music) and the revenue returned to those who create and invest in this content.
- The copyright bill introduces a new concept of “royalties” which are now payable to certain co-creators of content. According to the bill, a royalty means “the gross profit made on the exploitation of the work”. These co-creators are divided into three categories:
- Literary or musical works (writers, copyrighters, composers etc)
- Visual artistic works (photographers, animators, visual effects etc)
- Audio-visual works, including cinematograph films — performersThe bill doesn’t say how these royalties are to be determined but it does indicate that, using the example of performers, they “shall be determined in a written agreement in the prescribed manner and form, between the performer and the copyright owner or between their respective collecting societies” and further “where the performer and copyright owner cannot agree on the performer’s share of the royalty, the performer or copyright owner may refer the matter to the Tribunal for an order determining the performer’s share of the royalty”.
The bill prevents copyright owners from contracting outside of the legislation (ie asking co-creators to include future royalty claims in their initial fees) and, more incredibly, the details of how these royalty payments will be calculated and paid to the relevant co-creators. The bill proposes the establishment of “collecting societies” which have yet to be established, thereby potentially delaying payments which will be due, if the legislation is passed, for many years to come. To make the situation even more tricky, there is currently limited understanding of what the definition of “royalty” means — for example, will advertisers need to pay these royalties and, if so, how will the “gross profit made on the exploitation of the work” be extrapolated and applied?
All this uncertainty doesn’t bode well for producers of films and television commercials as they are currently unable to assess the costs and risks involved. It’s clear that the legislation hasn’t been well thought-out from a practical point of view and little consideration has been paid to the cost implications. These incalculable royalty payments could increase the cost of producing commercials in SA and increase the risks of the copyright owners.
Another unintended consequence is that the bills could act as a strong disincentive to foreign investors in film and advertising, who won’t feel comfortable that they’re able to manage their budgets effectively and confidently plan for the future.
Join the lobby
If the bills are passed in the coming weeks, advertising agencies and production companies will need to take legal advice on how to move forward when it comes to contracting with co-creators. If they are sent back for redrafting, our representatives will need a seat at the table to ensure that our interests are protected going forward. We must all urgently join the lobby to push back against legislation that, although well-intentioned, will ultimately do more harm than good.
Bobby Amm is chief executive of the Commercial Producers Association of South Africa (CPA), the trade association of production companies that produce television, cinema and internet commercials for the local and international market. After a brief stint in journalism, she began her career in the industry at the Consultative Committee for the Entertainment Industry in the early 1990s. She first joined the CPA in 1997 but left three years later to join a production company. After finding that she missed the big-picture perspective of the CPA and the interesting issues which continuously perplex the production industry, Bobby returned to the CPA in 2003. She contributes “The Martini Shot” column monthly, covering developments, trends and insights into the commercial production and film services industries in South Africa, to MarkLives.