QUESTIONS BY SENATOR MATHIAS FOR MR. FEIST 1. Has our absence from Berne hurt any U.S. copyright objectives? Has it been raised by other countries against our request that they accord us reasonable kinds of copyright protection? 2. The Berne Convention has been in existence for a century now; yet U.S. copyright holders have built important markets in many foreign countries. How has our absence from the Berne Convention hurt us? 3. Is there any perceptible dfference between the copyright laws and the quality of copyright protection in those developing countries that belong to Berne and those that belong only to the Universal Copyright Convention (UCC)? How well has Berne done in the Third World? Has the UCC been widely accepted there? 4. Most major countries that belong to the UCC also belong to Berne. U.S. works receive the benefits of Berne protection in these countries, since the UCC requires national treatment, i.e. you must treat the works of foreign authors the same as your own. Why can't we go on this way? Given the openness of our markets, is there really any practical reason why this arrangement can't continue? In other words can't we get the benefits of Berne without having to incur any of the costs through changes in our domestic law? 5. Everyone is interested in the special copyright problems which are presented by new technology. How would adherence to Berne affect our ability to respond to these challenges? 6. In terms of work-for-hire, are we looking at a serious legal conflict between our law and Berne obligations, or does Berne try to leave room for countries such as the U.S. to maintain their long-standing rules governing work-for-hire and copyright ownership-authorship? 7. The Ad Hoc Working Group found that the mechanical license provision for making and distributing phonograph records is compatible with Berne. Do you agree? 8. To help the subcommittee better understand the situation with respect to the compatibility of the jukebox exemption and the Berne Convention, please respond to the following questions: How does the incompatibility arise? Can it be resolved through a form of compulsory licensing? What is the position of the organizations you represented at the hearing? Do they favor the elimination of the jukebox compulsory license? 9. Experts are divided on whether U.S. law on registration of copyright is incompatible with Berne. Assuming the Ad Hoc Group's assessment of incompatibility is correct, two options are available: (1) require registration for enforcement of copyright non-Berne works; or (2) replace mandatory registration with procedural and remedial benefits that would encourage registration. Other Berne countries, such as Canada, India and Mexico, presently use permissive registration as evidence of copyright validity. Which option would you prefer? WRITTEN QUESTIONS FOR MESSRS. NORMAN ALTERMAN, LEONARD FEIST, VICO HENRIQUES, AND JAMES P. Mooney SUBMITTED BY SENATOR SPECTER What are the advantages and disadvantages, in each of your respective business areas (motion pictures, music publishing, computer and business equipment, and cable T.V.), to the United States becoming a member of the Berne Convention? a) Ultimately, despite any disadvantages which you may cite, do you support the U.S. adhering to the Berne Convention? 205 EAST 42 STREET, NEW YORK, N.Y. 10017 (212) 370-5330 CABLE ADDRESS: HAFOX June 13, 1986 The Hon. Charles McC. Mathias, Jr. Chairman Subcommittee on Patents, Copyrights and Trademarks Committee on the Judiciary 137 Dirksen Office Building, United States Senate Washington, D.C. 20510 Re: U.S. Adherence to the Berne Convention Dear Senator Mathias: This is in reply to your letter of May 21 and its accompanying 1. We believe that the United States' absence from the Berne Convention has deprived this country of direct, effective, and voting participation in the world's most important council of international copyright deliberation, and has hindered the United States government's efforts to move other countries to adopt adequate copyright laws for American works. Indeed, representatives of the pertinent U.S. government agencies testified before your Committee that our failure to become a member of the Berne Convention has been cited by other countries in justification of their low (if any) level of protection for our works. 2. The markets for American works abroad are most certainly important. Yet these markets are being increasingly decimated by piracy in both printed and recorded forms. (Rampant "record piracy" and unauthorized audio and video cassette duplication, it must be noted, are not only an affront to record and film producers; each such instance is also a piratical use of the copyrighted music embodied in the record, film, or cassette.) For the reasons given above and in my testimony, we believe that U.S. adherence to Berne is an important component of ongoing efforts to fight piracy. I would also note that to a considerable extent, our foreign markets have been supported as a legal matter by the device of "back door" Berne protection. As indicated in my testimony, this is neither a model procedure nor compatible with our country's responsibility for leadership in the world copyright community. - 3. As a general matter, developing countries that belong only to the UCC are held to a significantly lower level of protection than those adhering to the Berne Convention, and have little incentive to upgrade the protection they accord in practice. Additionally, we believe that for the reasons given in my prepared statement the administering body and mechanism of the UCC does not adequately reflect or provide the opportunity for vigorous protection of developed countries' interests in intellectual property matters. It appears that developing countries may be drawn to the UCC, rather than Berne, for just these reasons and that this tendency is magnified in the context of current efforts to improve the quality of protection for American works abroad. (Also, it may be noted that, under the Appendix Declaration to Article XVII of the UCC as revised at Paris, developing countries may withdraw from the Berne Union without losing UCC protection of their works in other countries adhering to both Berne and the UCC.) It is difficult, if not impossible, for the United States to argue against this tendency and redirect attention to the more meaningful standards of the Berne Convention while remaining outside the Berne Union. - 4. The difficulty with relying on what may be called the "side door" to Berne - obtaining Berne-level protection under the national treatment principle of the UCC in countries adhering to both conventions is similar to that characterizing the "back door" approach: it is not in keeping with our claims to, and need for, stature in the world copyright community; if this country is to enjoy the benfeits of Berne, it should become a full participating member of the Union. Additionally, as suggested above, the "side door" is wholly ineffective in current efforts to seek effective protection in countries that have so far remained outside both conventions or adhered only to the UCC, or in developing countries that may withdraw from the Berne Union. 5. The Several government witnesses and the Director-General of the World Intellectual Property Organization have assured the Committee that Berne is not a "strait jacket," precluding innovative and responsive adjustments to new technologies. fact that many Berne members have taken the lead in assuring copyright owners equitable compensation for the problem of home taping, for example, supports this conclusion. Additionally, the United States must participate in international deliberations over copyright and new technology; it must do so in the company of other developed countries (adherents to Berne) and from a posture of respect as a full participant in that community; and it must have an effective voice in the most important chamber of debate our adherence to Berne is an important step in achieving these goals. 6. We agree with the conclusion of the Preliminary Report of the Ad Hoc Working Group on Adherence to Berne that United States law on ownership and authorship of works made for hire is fully compatible with the obligations of Berne membership. 7. We also agree with the conclusion of the Ad Hoc Working Group that the compulsory license for making and distributing phonorecords of copyrighted music is compatible with the Berne Convention. (As a matter of principle, however, it should be noted that we do not approve the notion of compulsory licensing of musical works for such purposes.) 8. We believe that answers to this question would best be supplied by the performing rights organizations who deal with the matter. 9. We do not generally favor a "two tier" copyright system that would discriminate between Berne and non-Berne works; we think it would be cumbersome, cause confusion, and prompt unnecessary issues, as well as constitute an affront to American authors and copyright proprietors. A system of wholly permissive registration, according prima facie evidentiary benefits to those who seek it, but freeing all other meaningful attributes of ownership, enforcement, and relief from formalities, is the preferred alternative. With respect to Senator Specter's separate question, music publishers are uniquely affected by our international copyright relations. As I noted at the hearing, in many ways American music may be the most abundant of all categories of this country's copyright exports. From that perspective, the advantages we see to Berne adherence are best summed up in the enclosed "Summary" of my April 15 testimony. Thank you for the opportunity to submit these comments. Dictated but not read Sincerely yours, Lexward Zeist Leonard Feist Senator MATHIAS. Thank you very much, Mr. Feist. Mr. Henriques. STATEMENT OF VICO E. HENRIQUES Mr. HENRIQUES. Thank you, Mr. Chairman. My name is Vico Henriques. I am the president of the Computer and Business Equipment Manufacturers Association. In 1985, our industry had a trade surplus of $4.445 billion. I want to emphasize that trade surplus because as large as it is, I believe it could be larger. One of the factors retarding the growth of the surplus is the violation of U.S. companies' intellectual property rights around the world, and that problem is why I am here to lend our full support to make the United States a signatory to the Berne Convention. High technology rests on- Senator MATHIAS. Is that primarily a software problem you are talking about? Mr. HENRIQUES. It is both software and design-the chip designas well. The new ideas behind computer hardware, software, and services are crucial to the future. The disks themselves, the chips, and the boards mean very little, but the design of the chips, the sequence of commands in software, and the algorithms that produce answers are the reasons that people buy and use computers. These designs, sequences, and algorithms are not objects that you can lock up in a warehouse to guard against theft. They are ideas that have to be implemented broadly to have value. Like reading books or playing music, it is the use of computers that is important. To ensure a constant flow of improved technology, we have sought intellectual property protection for the ideas and inventions of our industry. For software, the primary protection is copyright. But, today, copyrights are commonly violated by international pirates who make unauthorized copies of software that they have not invented and then sell these copies for a fraction of their legitimate market price. In a recent report, the International Intellectual Property Alliance estimates that in nine developing countries alone the United States is losing $128 million a year in software sales. And we cannot even begin to estimate the amount we are losing through exports of that pirated software from those same countries into the international marketplace. Solving this problem requires a series of carefully planned steps. I have personally gone to Taiwan and Singapore as part of a Government delegation to try to negotiate an end to piracy. We have recommended that benefits under the GSP be altered or terminated for countries that refuse to grant adequate and effective intellectual property rights, and we are very supportive of the current USTR efforts to negotiate an end to Korea's intellectual property violations. Signing the Berne Convention is another in this series of steps we should take toward solving international piracy. It provides a higher level of protection than could be afforded by the Universal |