be stated that in no other cases is it allowed to restrict or deny national treatment.

And the third element is that the protocol should make it clear that national treatment should be fully applied also in the case of collective administration of rights.

As I said, I would like to refer briefly to the new instrument simply to say that the working document proposes, that in respect to the new instrument, national treatment should be applied fully.

But I'd like to say that this in itself may not be sufficient. An appropriate relationship should be established between the protocol to the Berne Convention on the one hand and the new instrument on the other.

In the working document, there is nothing about that because the governing bodies decided to postpone decision about this to a later stage.

But it is very clear that this so-called bridge instrument, the new instrument, can only function well as a bridge if the principle of national treatment is applied to both the protocol and the new instrument on the rights of performers and producers of phonograms. Not separately but parallel.

And I think it will be of course the subject of discussion later whether this is acceptable for everybody or not.

I'd like to make two closing remarks. First is that the international bureau of WIPO proposes that the principle of national treatment should be reinforced, but we would like to stress also that there is a corollary to this. That is, that the minimum level of protection under the Berne Convention also should be updated. My second remark and my last remark is that you may find that the views expressed and the proposals made in the working document-how shall I put it-are closer to the position of the United States in this respect than the position of certain other countries. We consider that no reasonable international arrangements are feasible in this field without the participation and support of the United States. However, the reason behind these views and proposals is not that we would like to please the United States or to take side in the debate between the United States and other countries. The reason is that those views and proposals correspond to the principles and obligations under the Berne Convention.

And those views and proposals correspond to professional honesty and to the objectives WIPO is supposed to serve for the international community. Thank you, Mr. Chairman.

Mr. HUGHES. Thank you, Director Fiscor.

[The prepared statement of Mr. Ficsor follows:]

PREPARED STATEMENT OF MIHÁLY FICSOR, DIRECTOR, COPYRIGHT DEPARTMENT, WORLD INTELLECTUAL PROPERTY ORGANIZATION (WIPO), GENEVA, SWITZERLAND Mr. Chairman and Members of the Subcommittee,

It is a great privilege to appear before you to testify on the application of national treatment one of the basic principles of the Berne Convention for the Protection of Literary and Artistic Works-in relation to a possible protocol to the Convention. I thank you for this invitation both on behalf of WIPO and on my own behalf.

I. INTRODUCTION

The principle of national treatment-or, in other words, the principle of assimilation of foreign authors to national authors-has been one of the cornerstones of the

Berne Convention since its adoption in 1886 (and, as we shall see, in international copyright relations, it is even older than the Berne Convention itself).

For a long time, the principle of national treatment was duly respected by the countries party to the Convention. The Convention itself allowed certain-strictly determined-limitations to the application of this principle in exceptional cases, but apart from those limitations, the applicability of national treatment was not questioned.

In the last decades, with the advent of new technologies, new categories of works and new ways of exploiting works appeared and spread rapidly, calling for the extension of the scope of copyright protection or at least for the adaptation of the existing norms to the new developments. In this situation, the consistent application of national treatment would have been particularly important. However, as we shall discuss later, national treatment was denied or restricted in various countries party to the Berne Convention in respect of certain new categories of works and/or certain "new" rights (or even certain old rights to be applied under new circumstances).

The main purpose of preparing a possible protocol to the Berne Convention is to respond to the challenges of the new technologies and to clarify the international copyright standards in respect of the new categories of works and new ways of exploiting them.

The documents prepared by the International Bureau of WIPO for the first two sessions of the Committee of Experts working on the preparation of the proposed protocol, held in November 1991 and February 1992, proposed that the principle of national treatment be applied consistently for all new categories of works and for all "new" rights (or old rights to be applied under new conditions) covered by the terms of reference of the preparatory work. The discussions during those two sessions revealed, however, that several countries would still be in favor of more or fewer-direct or indirect-limitations on national treatment.

It was against that background that the Assembly of the Berne Union, when in September 1992 it determined the terms of reference of the third session of the Committee of Experts (which will be held from June 21 to 25, 1993), included “national treatment" (a separate comprehensive consideration of the questions concerning this principle of the Berne Convention) in the three "new items" to be discussed (the other two being "the distribution right, including the importation right," and "the enforcement of rights").

In this statement, I shall first describe the provisions of the 1971 Paris Act (that is, the latest Act) of the Berne Convention concerning national treatment (Part III). I shall then review the history of the regulation of national treatment in the Convention which has led to the present status (Part III). Finally, I shall deal with the new challenges to the application of the principle of national treatment and the way the working document of the International Bureau of WIPO proposes to respond to those challenges (Part IV, containing the relevant paragraphs of that working document, together with some brief additional comments).

II. THE REGULATION OF NATIONAL TREATMENT IN THE LATEST ACT OF THE BERNE CONVENTION

The basic provision on national treatment is contained in Article 5(1) of the 1971 Paris Act of the Berne Convention. It reads as follows: "Authors shall enjoy, in respect of works for which they are protected under this Convention, in countries of the Union other than the country of origin, the rights which their respective laws do now or may hereafter grant to their nationals, as well as the rights specially granted by this Convention."

Let us analyze the various words and expressions of this provision.

"Author": It would be beyond the purpose of this statement to discuss the different meanings of the word “author" under the various national laws and the relationship of those laws to the relevant provisions of the Berne Convention. It seems necessary to state, however, that "author"-with the exception of certain provisions (particularly those of Article 6bis of the Convention on "moral rights")-also means any successor of title of the author. This clearly follows, inter alia, from Article 2(6) of the Convention which reads as follows: "This protection shall operate for the benefit of the author and his successors in title" (emphasis added). Thus, it is clear that all categories of owners of copyright in literary and artistic works are entitled to national treatment under Article 5(1) of the Convention.

"[S]hall enjoy": The verb "enjoy" relates to the rights identified in the provision. The fact that it stands alone, and no reference is made-in addition to the enjoy ment of rights to the exercise of rights, may be important to determine the extent to which national treatment is applicable to the various aspects of copyright legisla tion. The Convention differentiates between enjoyment of rights and exercise of

rights (see, particularly, Article 5(2), also discussed below). The notion of "enjoyment" of rights is clear: it means that certain rights are actually granted to owners of copyright. The notion of “exercise" is less clear, or, at least, it may be said that, in the various provisions of the Convention, the word "exercise" is used in such different contests that it may not be thought to have the same scope of meaning everywhere. In particular, in Article 11bis(2) of the Convention, the expression "to determine the conditions under which the rights mentioned in the preceding paragraph may be exercised" is generally interpreted to mean the possibility of applying nonvoluntary licenses (and the intention expressed by the relevant revision conferences as reflected in the records of those conferences confirm that this interpretation is justified). A non-voluntary license, however, is not a mere question of the exercise of an exclusive right; it is a limitation of that right (to a right to remuneration), that is, it is a question of the enjoyment or non-enjoyment of a certain right (an exclusive right of authorization). Such provisions, therefore, are actually covered by the provision of Article 5(1) of the Convention on national treatment (which only speaks of enjoyment of rights). In Article 5(2) of the Convention, where it is provided that the enjoyment and the exercise of these rights shall not be subject to any formality" and that "such enjoyment and such exercise shall be independent of the existence of protection in the country of origin of the work," what is involved in respect of the exercise of rights is the possibility to exercise the rights and not the rules on the way those rights may be exercised (whether they are transferable, and in which way transfers and/or licenses may be granted). However, the national laws of a number of countries-mainly those with civil law (or "Continental") legal traditions—also contain more or less detailed norms on the actual exercise of rights (transferability of rights, the conditions of transfers and/or licenses). The fact that Article 5(1) only mentions the enjoyment of rights—and not the exercise of rightsmay serve as a basis for the interpretation that the principle of national treatment does not extend to the above-mentioned norms on the exercise of copyright (and thus, in those respects, the applicability of the general rules of private international law may emerge).

"[I]n respect of works for which they are protected under the Convention": This means two things. First, this means that the obligation to grant national treatment only extends to those productions which are covered by the notion of literary and artistic works under Article 2 of the Convention (the questions related to this condition are discussed in detail in Part IV below). Second, this means that a production should not only be covered by the notion of "work" under the Convention, but it should also be eligible for protection under Articles 3 and 4 of the Convention which determine the so-called points of attachment (conditions of protection, such as nationality or first publication in the country).

"[I]n countries of the Union other than the country of origin": This also means two things: First, this means that, in the country of origin of the work, the provisions of Article 5(1) are not applicable. The country of origin of a work is defined in Article 5(4) of the Convention (in general, the country of first publication and, in certain cases, the country of nationality, of the headquarters or habitual residence of the makers of cinematographic works or of the place where an architectural work has been erected). It is Article 5(3) of the Convention which determines which law governs protection in the country of origin, namely, in general, the domestic law alone. However, when the author is not a national of the country of origin of the work for which he is protected under the Convention, the said article provides that he must enjoy in that country the same rights as national authors. This means that the nationals of the country of origin do not enjoy any protection under the Convention; their protection is governed exclusively by the national law (that is, "the rights specially granted by [the] Convention" are not applicable obligatorily), while non-nationals are protected by the rule that they must enjoy the same rights as national authors (national treatment): this provision is intended to prevent possible discrimination against non-nationals in the domestic law.

"[T]he rights which their respective laws do now or may hereafter grant to their nationals": The basic question is what the expression "respective laws" means, and the answer to this question is fairly evident: "respective laws" are the laws on "the rights of authors in their literary and artistic works," that is, the rights of authors to be protected under the Berne Convention in keeping with the preamble and with Article 1 of the Convention which, by using the above-quoted expression, determine the subject matter of the Convention. This means that not all the rights of authors are protected under the Convention, but only the rights in their literary and artistic works (that is, for example, a right for the authors to receive a certain subsidy or tax allowance under certain conditions, based on the fact that they pursue the profession of authorship, is not a right in literary and artistic works, and, thus, is not covered by the obligation to grant national treatment). On the other hand, with the

few exceptions allowed under the Convention (see below), the obligation to grant national treatment extends to all the rights of authors in their literary and artistic works provided for in the laws of the countries concerned.

"[A]s well as the rights specially a granted by this Convention": This phrase, in principle, goes beyond national treatment proper, but it is an indispensable corollary to the principle of national treatment. National treatment alone might involve important differences among the levels of protection in different countries, and this might create unacceptable situations for countries that provide for much more generous protection than average in their relations with countries that provide for an unusually low level of protection. Therefore, the obligation to grant national treatment under the Berne Convention has always been linked to the obligation to grant at least the minimum protection determined by the Convention. Of course, such minimum protection, unless certain countries apply less favorable treatment to their nationals than to foreigners (which is rarely the case, but still there are some examples), in general, actually becomes part of national treatment. The minimum level of obligation has been increased-or at least clarified in various aspects—as a result of the subsequent revisions of the Convention.

The Berne Convention determines the few cases in which reciprocity rather than national treatment may be applied. These are the following:

(i) works of applied art: if in the country of origin they are protected solely as industrial designs, a country which grants protection both under its copyright law (for "works of applied art") and its industrial design law (for "industrial designs") may deny protection under its copyright law (but has to grant protection under its industrial design law (Article 2(7));

(ii) works that qualify for protection by virtue of the "back door" provision: their protection may be limited to the protection that is given to works of nationals of the countries party to the Convention by the country whose nationals the authors of such countries are (Article 6(1));

(iii) comparison of terms: if a country grants protection longer than the minimum provided in the Berne Convention and the country of origin of the work grants protection that is shorter than in the first-mentioned country, the first-mentioned country may apply the said shorter term in the case of a work the country of origin of which grants the shorter term (Article 7(8)) (there is a specific exception in Article 30(2) concerning the term of protection of the right of translation, but, for all practical purposes, it is not significant);

(iv) droit de suite: a country that recognizes the droit de suite (that is, a right of the author to a share in case of any resale of the original of his work of art or of the manuscript of his work) may only apply it to works whose authors are nationals of another country which also recognizes the droit de suite (Article 14ter(2)).

As discussed in Part IV, below, in addition to the above-mentioned cases determined in the test of the Berne Convention, there seems to be one more case whereon the basis of a subsequent de facto agreement among the member countries of the Berne Union-national treatment may be denied or restricted, namely, in the case of public lending right of books and other similar publications.

National treatment is one of the three principles that are traditionally considered to be the basic principles of the Berne Convention. The other such basic principles are the principle of formality-free protection and the principle of independence of protection. Both are included in Article 5(2), referred to above in a different contest, and both-although in different ways-may be qualified as indispensable corollaries to the principle of national treatment.

As discussed in Part III, below, the principle of formality-free protection has grown out of what used to be an exception to the principle of national treatment. It was recognized as early as at the time of adoption of the Berne Convention (and even before, in the contest of bilateral agreements) that the application of the formalities of the country where protection is claimed, rather than the application of the formalities of the country of origin alone, would make the enjoyment and exercise of copyright extremely difficult and in certain cases nearly impossible. A further step was, as discussed, that formalities as conditions of protection were completely abolished. Thus, the first phrase of the first sentence of Article 5(2) now reads as follows: "The enjoyment and the exercise of these rights [that is, the rights to be protected under the Convention] shall not be subject to any formality."

The principle of independent protection is included in the remainder of Article 5(2). The second phrase of its first sentence and its second sentence read as follows: "[Such enjoyment and such exercise shall be independent of the existence of protection in the country of origin of the work. Consequently, apart from the provisions of this Convention, the extent of protection, as well as the means of redress afforded to the author to protect his rights, shall be governed exclusively by the laws of the country where protection is claimed." The relationship of this principle to the prin

ciple of national treatment is so close that saying that this principle is a corollary to the principle of national treatment may even be considered to be an understatement. What is involved may also be thought of as a further clarification of the way national treatment must be granted and applied. In Article 5(1) (on national treatment), the emphasis is on the level of protection to be granted, while in the abovequoted provisions of Article 5(2) (on the independence of protection), the emphasis is rather on the applicable law.

The second sentence of Article 5(2) seems to offer further arguments for the interpretation that the obligation to grant national treatment does not cover the provisions on the exercise of rights (that is, the provisions on the questions of transferability and on the conditions of transfers and licenses) and that the applicability of those provisions is a question for the application of the general principles of private international law. This is so because the said second sentence only refers to the extent of protection (that is, the enjoyment of rights) and to the means of redress afforded to the author to protect his rights (that is, the enforcement of rights), but not to the provisions governing the exercise of rights. (It is true that, in respect of cinematographic works, the Berne Convention itself-in its Article 14bis-regulates certain aspects of the exercise of rights; this is, however, an exception to which the said second sentence refers, inter alia, by its phrase "apart from the provisions of this Convention.")

III. REVIEW OF THE DEVELOPMENT OF THE PRINCIPLE OF NATIONAL TREATMENT UNDER THE BERNE CONVENTION

Since one of the most important purposes of studying history is to be able to better understand the present and to try to deduce some useful lesson for the future, it seems worthwhile to look back on how the principle of national treatment in the field of international protection of copyright was born and how it evolved during the subsequent revisions of the Berne Convention.

If we only start with the adoption of the Berne Convention in 1886, we may state that the principle of national treatment, combined with provisions determining the minimum level of protection, was the result of a compromise between those who wanted to create a universal copyright law applicable in all countries-based on the theory of a natural right of the author in his intellectual property-and those who considered a more pragmatic approach desirable, namely the approach according to which, first, a minimum level of protection should be combined with the obligation to grant national treatment, and that the objective of a "universal copyright law" should be attained gradually later, as a result of subsequent completions and improvements of the Convention.

However, a knowledge of the pre-history of the Berne Convention also seems to be important to understand in what context the principle of national treatment emerged in international copyright relations.

Before the adoption of the Berne Convention, international protection of copyright (that is, the protection of the works of foreigners) existed in three major forms: (i) in the form of "courtesy copyright": (ii) in the form of reciprocity without any international agreement and (iii) in the form of bilateral agreements (in some of whichwith the possibility of accession by further countries-also the elements of multilateral agreements started to appear).

"Courtesy copyright"—that is, granting copyright protection to foreign works without requiring reciprocity-was based on the theory of a natural right of authors in their intellectual property, which, according to the same theory, was to be recognized as being universal in character throughout the world, irrespective of the nationality of the authors or of any other criteria (such as the place of publication). "Courtesy copyright" was granted only in two countries: in France in 1852 and in Belgium in 1886. (This way of protecting foreign works has ceased to exist also in those countries since then). The two laws were not based on the same approach. The 1852 French law granted foreign authors the same rights in France as those enjoyed by them in their own countries (that is, national treatment was not granted), while the Belgian law was based on the principle of national treatment.

The most typical solution for international protection-in the absence of bilateral or multilateral agreements-was making such protection conditional on reciprocity. In certain countries, reciprocity meant material reciprocity, that is, a substantially equivalent protection was required in the other country concerned (such kind of reciprocity was required, for example, in the Danish Law of 1744 and the Austrian Law of 1846). In certain other countries, only formal reciprocity was prescribed, that is, some kind of reciprocity in the other country concerned was necessary, but substantial similarity of the protection granted was not a further condition. The nationals of the other countries were assimilated to the nationals of the country where protec