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Israel's New Copyright Law

Israel's New Copyright Act
by Tony Greenman attorney at Law
 
March, 2008
On November 19th, 2007 the Knesset passed the Copyright Law of 2007. The new law will go into effect on May 25th, 2008, six months after its publication and will replace the Copyright Law of 1911 and the Copyright Ordinance, which have regulated copyright in Israel since the country’s foundation.
 
 
The passing of the new copyright law is the conclusion of a decades-long process, commencing in the seventies, with the forming of a that it was time to replace the mandatory copyright law, which had existed since the beginning of the former century, a time when film was a new technology and television, video and the internet did not exist.
 
 
Despite a relative broadening of authors' rights, the most prominent provisions of the law are to be found in the new chapter on permitted uses. These permitted uses shift the point of balance in copyright law, between a creator’s rights and user’s rights and in particular users' freedom of expression, in favor of users and freedom of expression.
 
 
The Protected Works
 
 
As in the past, copyright law will apply to original literary, artistic, dramatic and musical works, as well as to sound recordings. However, the definition of a work of art has been amended in several ways. Whereas in the past the law protected only “a work of architectural art”, the new law protects any work of architecture, whether it be a building, a structure or a model for one of those. The definition of a computer program has also been extended. From now on a computer program will be protected in any way in which it is expressed.
 
 
Databases have found a place in the new law under the definition of the term “compilation“. However they must meet the standard of originality which is to be discussed hereafter. If so, the protection granted to them will apply to the original selection and arrangement of the contents of the database, but not to its contents themselves.
 
 
The law includes a new definition of a “cinematic work”, which is considered a type of dramatic work. According to the definition the term applies also to “a television work and any work which is similar in essence to a cinematic or television work”.
  
 
The Conditions for Existence of Copyright
 
 
Clause 4(b) of the law adopts the test of originality, introduced into copyright law in the ruling of Chief Justice Shamgar in the Interlego case. In that case, the court held that creativity is a necessary condition for the existence of copyright in a work, and that the investment of time, labor and financial resources is not enough. The new clause determines, in the spirit of the American and European laws and in accordance with Chief Justice Shamgar’s ruling that the originality of a compilation lies is in the selection and arrangement of the works or material in it.
 
 
In addition, Clause 4(b) states that in order to be protected by copyright, a work must be affixed in some manner. In doing so, the law puts resolves the previously open questions as to the existence of a requirement of affixation in Israeli copyright law.
 
 
Clause 10 sets an innovation in regards to the international scope of copyright protection, which authorizing the Justice Minister, with the government’s approval, to restrict the copyright of citizens of countries which do not give due protection to works of Israeli authors.
 
 
The Rights of the Copyright Owner
 
 
A very important new provision of the law is the adoption of the right of making a work available to the public, which is to be found in Clause 15 of the law. This right, which derives from the 1996 WIPO Copyright Treaty states that an “author shall enjoy the exclusive right of making a work available to the public in such a way that members of the public may access it from a place and at a time individually chosen by them”. The main action which this law was created to control is the uploading of works to the internet or other types of networks to which there is free access.
 
 
Clause 11 (4) of the law adds the broadcast right as an independent right, though this in itself is not an innovation, as this right was already recognized by the old law as part of the public performance right.
 
 
Clauses 11 (6) and 16 recognize the right to create a derivative work. This right was not defined as such in the old law, but it was recognized de facto as a result of combining several provisions regarding converting a work of one type to another type, so that there is no radical change in its adoption in the new law, though some see it as broadening the creator’s rights, at least declaratively. 
 
 
In contrast to the expansions discussed, the new law limits the right to rental which, in the past, was granted to any work but now is limited to sound recordings, films, and computer programs. Clause 17(b) of the law follows, and in fact expands, the Supreme Court’s ruling in the case of the Holon Library, in stating that renting by a public library or that of an educational institution is not considered commercial renting.
 
 
The law did not adopt another and more basic right, included in the WIPO Treaty, i.e. the right of distribution. It is not clear why this right was not included in the new law.
 
 
Permissible Uses of Works
 
 
The most significant innovations in the law are found in Chapter 4, which creates a long list of limitations to copyright, which shift, as stated, the balance between authors’ rights and users’ rights, including the right to freedom of expression, in the direction of users’ rights. The chapter lists a series of defined permissible uses and in addition creates an expanded permit for fair use of works. Prominent among the defined uses permitted in the new law is the permit to copy a computer program and create derivative works from it, under certain conditions, in order to create a backup, for maintenance, providing service, checking and fixing integrity, and most importantly – for creating interoperability. Also prominent is the license to create temporary copies of works as an inseparable part of the act of a communications service provider. Likewise, the law grants archives and libraries a license to create copies for the purpose of preservation and replacement of damaged or lost copies, including the right to do so by media conversion. This is a very important provision for the preservation of culture and it is to be hoped that the state will grant archives and libraries the budgets needed to implement it.
 
 
The most significant of the chapter is without a doubt the fair use clause. Whereas in the previous law fair use was only permitted within the confines of a closed list of defined uses, Clause 19 of the new law allows for fair use of a work in a manner which is not constrained by such a closed use. According to the new law fair use of a work is permitted for purposes such as private study, research, criticism, summary, journalistic reporting, quoting (an innovation whose limits will have to be clarified), as well as teaching and examination by an educational institution. The keywords here are “such as”, which as stated, create an open list of uses which can be added to in future.
 
 
The fair use clause establishes the fairness tests of American law, which were already adopted by the Supreme Court, if not always implemented in full. These tests are: the purpose of the use and its nature; the nature of the work used; the extent of the use of the work; the effect of the use on the value of the work and its potential market. The emphasis needs to be on the first and last tests, where in the framework of the first test it is to be hoped that the question of whether the use creates a new (transformative) expression will be examined.
 
 
The Ownership of Copyright
 
 
A few changes have been made regarding the initial ownership of copyright. The principle that the creator is the first owner of copyright of his work remains, however according to the new Clause 35(a), the copyright in a commissioned work will belong to the creator unless there exists a different agreement between the creator and the hirer, explicit or implied. Implied agreement is a slippery term which will no doubt keep the courts occupied in the future.
 
 
As in the past, the ownership of copyright in a work made by an employee as part of his employment will belong to the employer, unless agreed otherwise. The new clause 34 emphasizes that a condition for its application is that the work was created not only in the course of employment, but for the purpose thereof.
 
 
Photographers will from now on own the copyright to their photographs. This is in contrast to the previous law which granted initial copyright ownership of a photograph to the owner of the negatives. As opposed to photographers, salaried journalists lose out from the new law. Although the copyright in their articles has always been in the hands of their employers, the publication of an article other than in the newspaper previously required the journalist’s consent. This “negative” right was nullified in the new law and from now on the owners of newspapers will be able to publish their employees’ articles wherever they please, including on the internet.
 
 
The state will be the owner of copyright in a work commissioned by it or by a state employee during and for the purpose of his employment.
 
 
According to Clause 33(b) of the new law, copyright in a sound recording will from now on belong to its producer and not to the owner of the master.
 
 
A contract for assignment of copyright remains subject to a written document but the requirement for signature, which existed in the previous law, has been omitted.
 
 
The Duration of Copyright
 
 
According to Clause 38 of the law, the duration of copyright for a work remains the life of the author and an additional seventy years after his death. Here too, photographers have benefited from the new lea. The duration of copyright for a photograph will from now on be according to the general rule – that is, the life of the photographer and seventy years after his death. However, the new provision will not apply to existing protected photographs.
 
 
The demands of the record industry to lengthen the duration of copyright for a sound recording were rejected (in a manner similar to the rejection of requests of the record industry in England). Consequently, records will continue to be protected for a period of fifty years.
 
 
Moral Rights
 
 
Moral Rights are protected under Chapter 7 of the new law. Clause 45 clarifies that moral rights are personal and belong to the author, even if copyright in the work belongs to another (in the language of the law, “even if the author has no copyright for the work”). It is also stated that this right exists for the duration of copyright for the work.
 
 
The right of paternity - that is the right to credit for one’s work - will be examined from now by a subjective test, where the right is to receive credit “in a scope and manner befitting the circumstances”.
 
 
The new law includes a problematic change in the definition of the right of integrity. The law clarifies that only a modification of the work which prejudices the name or honor of the author will be considered a violation of the moral right. However the term “modification” used in the previous law was substituted in the new law with the term “change of form”. It would appear that the word “change” was a better translation of the word “modification” which appears in the Bern Convention, and it is not clear why it was substituted for “change of form”.
 
 
Clause 50(c) states that an act which violates the integrity of a work will not be considered a violation of the moral right if it was “reasonable in the circumstances of the case”. The clause continues and provides considerations that a court may factor in ruling if an action was reasonable, inclusive of the fact that the work was created by an employee as part of his job.
 
 
Infringement and Remedies
 
 
The new law enacts several changes in the array of remedies available to the owner of copyright in case of infringement .An injunction, which was previously available as a matter of right, may be denied by the court if it considers there to exist “justifiable grounds ”. These grounds do not even have to be “special” grounds. In addition the sums of statutory damages which a court may award have been amended. The previously existing minimum compensation of NIS 10,000 was nullified. From now on the court may (but does not have to) order compensation without proof of damage in a sum of up to NIS 100,000 for any violation. However, Clause 56(c) of the law states that “violations made in a related series of actions will be considered as one violation”.
 
 
What’s Missing in the Law?
 
 
Conspicuously absent from the new law is any reference to a number of important issues in copyright law. It does not address the issue of private copying, which inflicts heavy losses on copyright owners. This subject is, however, the subject of a draft memorandum law and is being examined by the Ministry of Justice, with an eye to future legislation.
 
 
Other issues related to modern technology are also not mentioned in the new law. Internet Service Providers liability for copyright violations on the internet was left to be dealt with as part of the draft electronic commerce law.
 
 
The subject of protection of technological measures (DRM) is not mentioned, either in the law or in any memorandum. The Ministry of Justice is currently in the early stages of addressing this issue after receiving several submissions on the subject from the public.
 
 
The legislator also avoided resolving the issue of the initial ownership of copyright in cinematic works. This complicated subject, which requires special attention, will continue to be governed according to the general provisions of the law, which will maintain, for now, the bitter disputes in the film and television industries.
 
 
Summary
 
 
The new law has shifted the balance between authors’ copyright and users’ rights slightly in favor of users’ rights. Some will welcome this change, as there is widespread opinion in recent years that copyright laws have exceeded their proper scope, thus harming the freedom of expression and suppressing new and independent creation. The creators and the owners of copyright will see the change as unnecessarily harmful. In addition, the balance between the creators and the owners of copyright has shifted slightly in favor of the owners, which may strengthen the trend of concentration of ownership of copyright in the hands of powerful financial organizations. Such a result is certainly not welcome.
 
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