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In this section, the Copyright office briefly reviews some of the

major legislative issues

in the field of copyright that

are likely to be

brought to the attention of this Congress.

The question of United States

adherence to the Berne Convent ion is ment ioned in the next section, but we

note here that adherence requires changes in our domest ic copyright law.

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On June 15, 1984, at the second session of the 98th Congress,

Representative Kastenmeier introduced H.R. 5878, a bill to amend the Copyright

Act of 1976 with respect to the structure and operation of the Copyright

Royalty Tribunal (CRT) and the implement at ion of the cable compulsory license.

The bill would have changed the Tribunal's membership from five to three

commissioners, and would have authorized professional staff (one economist and

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adjustments pursuant to section 801(b)(2)(B) of the Copyright Act, including

the impact of the rates on cable subscribers both as to the availability and

cost of receiving copyrighted materials.

It would have excluded from the 1982

royalty rate

adjust ment distant signal equivalents represented by three

distant independent broadcast signals in the case of any cable system which

does not carry any local independent television broadcast signals, or

two

distant independent broadcast signals in the case of any cable system which carries any local independent television broadcast signal.

It would have

clarified the existing section relating to judicial review of final decisions

of the Tribunal by providing that review shall be had on the same standards

and bases as any executive branch or independent regulatory agency. Finally,

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subscriber groups receiving particular "tiers" of service containing secondary transmissions. 31 This bill was approved by this Subcommittee, but it was

not reported by the full Judiciary Committee.

Some of the features of H.R. 5878 may be given further considerat ion

in

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On October 12, 1984, the Copyright Office held a public hearing concerning

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with an examination of the divergent views presented at the hearing and during

the comment period, the Copyright Office concluded that the Copyright Act is

ambiguous on the issue of whether, when a cable system retransmits a low power

3/ In Copyright Office Final Regulations issued at 49 Fed. Reg. 13029, 13035 (April 2, 1984), the Copyright office determined that the Copyright Act does not present ly permit any prorat ion or other allocation of either distant signal equivalents or gross receipts by subscriber groups where any secondary transmission service is combined with nonbroadcast services in program tiers. The Office accordingly, clarified its definition of gross receipts for the "basic service of providing secondary transmissions of

primary broadcast transmitters." 37 C.F.R. $201.17(b)(1) (1984). These regulations are under

court in National Cable Television Assoc. Columbia Pictures Industries, Inc., et.al., Civil Action No. 83-2785 (0.0.c., filed September 21, 1983).

review

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television signal, the signal should be characterized as "local" or "distant"

for purposes of applying the DSE value formula. Consequently, in collecting

cable copyrighted royalties, the Copyright office will take a neutral position

on this specific issue.

The Office recommends legislative clarification of

this issue

In the same proceeding, the Office concluded that if Copyright owners and

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systems, in paying royalties pursuant to that section, need not take account

of the signal of a low power television station for which voluntary licenses

have been obtained.

This is so provided that the negotiated license covers

all cable-retransmitted works carried by a particular broadcast ing station for

the entire broadcast day for each day for the entire account ing period. This

decision is published at 49 Fed. Reg. 39174-39175 (October 4, 1984).

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a.

Nonproration of the distant signal equivalent value (DSE):

The

Copyright office recently issued final regulations, published at 50 Fed. Reg.

9270-73 (March 7, 1985), affirming without modification the Office's interim

regulations (published at 47 Fed. Reg. 21786 (May 20, 1982]) concerning the

calculation of DSE's after the FCC's June 25, 1981 deregulation of cable

television. The final regulations provide that proration of the DSE is

possible only as specifically legislated by Congress in the DSE definition of

section 111(f).

In summary:

(1)

The permissive substitution referred to in section

111(f) is governed by the FCC's former local content substitution rule, which

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possible; (2) proration is also possible in the case of part time carriage for lack of activated channel capacity since these FCC rules remain in effect;

(3) substitution of distant signals newly authorized by the FCC deregulation

must be calculated at

the full DSE value of the signal carried because

Congress did not establish an open-ended policy of permitting the reduction of

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FCC, by eliminating those rules, removed the justification for prorat ion; and

(5)

cable systems can no longer avail themselves of the syndicated program

exclusivity rules as a basis for substitution without calculation of a DSE for

such carriage. They may, however, continue to substitute other programming in

place of programming deleted pursuant to the FCC's sport exclusivity rule

.

without calculation of a DSE since those rules remain in effect.

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Television Markets List: The FCC recently published a final rule amending the

list of major television markets in section 76.51 of its rule

include

Melbourne

and Cocoa, Florida within the Orlando-Daytona Beach hyphenated

market.

50 Fed. Reg. 2565-70 (January 17, 1985). In response to a petition

from cable system represent at ives, the Copyright Office published a Not ice of

Inquiry (at 50 Fed. Reg. 14725, (April 15, 1985)] inviting public comment,

views and information on the impact on the copyright law of a change by the

FCC in the major television market list, which has the effect for FCC purposes

of making a formerly "distant" signal a "local" must-carry signal, and related

issues.

C.

The CRI'S 1985 Cable Royalty Inflation Adjustment Proceeding:

Pursuant to section 801(b)(2)(A) and (D) of the Copyright Act of 1976 the Copyright Royalty Tribunal (CRT) is authorized to adjust the cable television royalty rates and gross receipts limitations for inflation, upon the pet it ion

of parties with a "significant interest" in the royalty rates.

On March 8,

1985, the CRT received a joint submission from various parties represent ing

interested copyright owners and cable television systems whereby the parties

advised that they had entered into an "Agreement of Settlement Concerning 1985

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commenced an informal 1985 cable inflation adjustment proceeding and proposed

adopt ing the adjustment of royalty rates 4 and gross receipts limitat ions / suggested in the Settlement Agreement, to become effective with the first

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25, 1985, Turner Broadcasting System Inc. petit ioned the CRT to consider its

superstation WTBS a "national distant signal" and

remove

the 3.75 percent

47 .893 (instead of the current .799) of 1 per centum for the first DSE, .563 (instead of the current .503) of 1 per centum each for the second, third and fourth DSE's, and .265 (instead of the current .237) of 1 per centum for the fifth DSE and each additional DSE thereafter. See 17 U.S.C. $111(d)(2)(B)(1984); 37 C.F.R. $308.2(a)(1984).

5

/ The current $107,000 limitat ion would be raised to $146,000 and the $214,000 limitat ion would be raised

to

$292,000. See 17 U.S.C. $111(0)(2)(C)-(D) (1984); 37 C.F.R. $308.2(b) (1984).

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