THE LIBRARY OF CONGRESS Fiscal 1996 Budget Request (Millions) The Library of Congress National Library Service for the Blind and Physically Handicapped PREPARED STATEMENT OF MARYBETH PETERS Mr. Chairman and members of the Committee, I appreciate the opportunity to be here today. Recently I was appointed as Register of Copyrights; however, I am not new to the Copyright Office or the Library of Congress. I have been associated with the Copyright Office for 29 years. For more than a decade the management and staff of the Copyright Office have worked together to raise individual productivity. We are doing more with less. In 1980 our staff consisted of 561 employees, and we registered 465,000 claims to copyright. Today we have 470 employees, and we registered more than 530,000 claims. Moreover, in these years the number and complexity of the documents we record have grown substantially; so has the number of inquiries from the public, which come to us in writing, by the telephone or in person. Thus, for the most part we have stayed ahead of the continuously increasing workload without additional staff. Computer technology and a staff of dedicated automation specialists have played a key role in these accomplishments. However, times have changed. Everywhere you hear references to the National Information Infrastructure (the NII), the Global Information Infrastructure (the GII) and the Information Superhighway. Content is king in the networked environment, and much of the content consists of copyrighted works. Domestically and internationally the copyright industries are at the forefront of our economy and are one of our leading exports. These industries, which include motion pictures and television programs, cable, records, music, computer software, photographs, databases, traditional and electronic publishing, and multimedia CD-ROM's, accounted for 5.69 percent of the U.S. Gross Domestic Product in 1993 ($362.5 billion), employed new workers at four times the rate of the economy as a whole from 1988-1993 and contributed an estimated $45.8 billion in foreign sales in 1993. The protection of American creativity through copyright protection is a driving force behind our continued prosperity and progress. A major challenge for the future will be the protection of American works. Copyright law is the vehicle. Moreover, we must be sure that methods and techniques are in place to ensure the integrity of the data as well as to monitor uses of copyrighted works and provide a means for collecting and compensating copyright owners. It is clear that unless copyright owners are assured that their rights are protected, they will not be willing to license their product for electronic use without which the NII will be crippled and will operate well below its full potential. I can't stress too strongly the vital role that the Copyright Office and the Library of Congress have to play in all this. The collections of the Library, which are largely based on copyright deposits, will continue to make the Library a key resource in the exchange of information, entertainment, and knowledge. Complete, accurate, reliable, and objective records of millions of copyrights showing their ownership, legal status, and licensing information are essential to make all this work. The years of experience and the practical and legal expertise the Office has to offer to Congress, to our trade representatives, and to the ever-expanding copyright community will more and more be needed as this country addresses the challenges of this communications revolution. It is important to realize that the entire range of beneficiaries of copyright protection-creators, producers, copyright owners, and copyright industries-is supporting the Copyright Office through registration fees, and the Library through deposits of increasingly expensive and valuable material. There is a symbiosis here: federal copyright protection is essential to these interests, but they in turn support the creation and maintenance of the Library's unique collections and the Office's unique records. On February 2 at the joint hearing of the legislative branch appropriations subcommittees the placement of the Copyright Office in the Library was questioned. I, for one, believe this placement is appropriate. The first copyright law, enacted in 1790, gave the federal district courts the registration function; an author had to file a copy of the title page of his book in the clerk's office before the work was published. After publication, one copy of the work was to be delivered to the U.S. Secretary of State. Later the law was changed to have the official copy delivered to the Patent Office; however, under the acts of 1846 and 1865 one copy of all published works was to be deposited with the Library. Most works were not deposited, and enforcing the deposit provisions of the law was time consuming and difficult since the records of the 44 district courts had to be consulted. The Librarian of Congress with the support of the Patent Office recommended that the registration and deposit functions be centralized in the Library of Congress; Congress did this in 1870. As a result, the Library became America's greatest library with collections that reflected the entire breadth of American history and life. The placement of the copyright system in_the_Library of Congress was not by chance, and it has yielded tremendous benefits. Today, as in 1870, the Copyright Office and the Library uniquely support each other's mission. Rather than separating the Copyright Office from the Library and severing its ties, I believe the symbiosis should be strengthened. We are presently doing this. For example, we are creating and implementing a Copyright Office electronic registration, recordation and deposit system (CORDS). The Advisory Committee on the NII has emphasized the need to develop rights management systems. The Copyright Office will have a rights management component that will be available to all. Thus, it will be available to authors from every state and will allow such authors not only to be part of a national system of rights management as soon as their works are created, but to have their works available for inclusion in the Library of Congress online system. I believe this public system available to all authors and accessible to all users will be a critical component of the copyright system of the 21st century; it also will benefit the Library's National Digital Library efforts. The development of testbed for CORDS is the result of cooperation of the Copyright Office, the Library of Congress and the Corporation for National Research Initiatives (CNRI). Funding has come from the Library of Congress and the Advanced Research Projects Agency. The goal is to demonstrate and test ideas for a national centralized system that will allow electronic filing over the Internet of applications, deposits, and fees for copyright registration as well as documents of transfers of ownership including licensing information, such as terms and conditions of use. A major feature of the future system will be the storage and retrieval of copyrighted works from secure repositories for electronic dissemination in accordance with terms and conditions established by copyright owners. Our objective is an easily accessible centralized system which will serve the public as well as authors and other copyright owners. In this budget, we are requesting $1,477,890 to continue to build this system. This money is an investment in the future. It is critical to the protection of content on the information superhighway. Moreover, as we receive more and more applications, deposits and documents electronically, we will see savings in the processing of such materials and eventually in certain areas we will be able to reduce the number of employees required to do the job. Let me now turn to the GATT Uruguay Round Agreements Act, which was signed by the President on December 8, 1994. The implementation of the Uruguay Round Agreement on Trade-Related Aspects of Intellectual Property-known as the TRIPS agreement-resulted in three changes in the copyright law; however, one change has a major impact on the operations and workload of the Copyright Office. This change automatically restores copyright protection in a vast amount of foreign works which were previously in the public domain in the United States for a variety of reasons, e.g., publication without the notice of copyright required by our law, failure to renew the U.S. copyright, and the absence of copyright relations between the United States and a foreign country. Works from Berne Convention and World Trade Organization countries whose copyright term of protection has not expired in its source country will have their copyrights restored on January 1, 1996; they will receive the copyright term that they would have otherwise enjoyed had they not entered the public domain in the United States. The number of works covered by the restoration provisions is staggering. For example, it covers all works by Chinese authors published in China before October 15, 1992 as well as vast numbers of works of fine art that were published without the notice of copyright. The Office has already been contacted by an organization that represents the works of Pablo Picasso (who created more than 100,000 works in various media), Georges Braque, Henri Matisse, Joan Miro, Marc Chagall, and Wassily Kandinsky. We have also been contacted by lawyers who represent publishers and the estates of well known playwrights and novelists. Although protection is automatic, there are complicated provisions covering a prior user of a restored work, defined as a "reliance party," who is insulated from fiability for infringement in certain circumstances and for a certain period of time after the copyright is restored. The ability of the owner of a restored copyright to enforce rights against reliance parties turns on his filing a notice of his intent to do so with the Copyright Office or alternatively serving a notice directly on the reliance party. Notices filed with the Copyright Office must be filed within two years of the date of restoration of the copyright in the work. A notice may be served at any time on a particular reliance party against whom the rights are to be enforced. With respect to notices of intent to enforce a restored copyright that are filed with the Copyright Office, we are required to publish in the Federal Register a list identifying the restored works for whom such notices have been filled with the names of owners of the restored rights. Reliance parties are granted a one year grace period |