Australia: Why Geo-dodging to watch US Netflix should be officially OK

Last Updated: 13 May 2016
Article by Kim Leontiev and Patricia Monemvasitis

Why Geo-dodging to watch US Netflix should be officially OK and other insights of the Productivity Commission Intellectual Property Arrangements Draft Report

If you're one of the tech-savvy cats out there who has been accessing US Netflix, or Canadian Amazon, or any other foreign geo-blocked version of a movies, TV, music or e-books content provider, the Productivity Commission Draft Report on Intellectual Property (IP) Arrangements has some good news for you! Fret no more (if you even have been) about the legality of using that Virtual Private Network (VPN) to "geo-dodge" or circumvent the country-specific blocks to access the much larger libraries of US or Canadian content services because the Productivity Commission is on your side! In its IP Draft Report released last Friday (29 April 2016), the Productivity Commission concludes, amongst other things, that Australia's copyright legislation (the Copyright Act 1968 (Cth)) should be amended to "make clear that it is not an infringement of Australia's copyright system for consumers to circumvent geo-blocking technology".

The close to 600 page IP Draft Report ("the Report") follows several months of public inquiry and submissions from key industry stakeholders such as IP rights holders and their representatives, consumer groups, internet service providers, and the broader IP legal community on various aspects of IP and whether current arrangements provide the appropriate balance between access to ideas and products and encouraging innovation, investment and production of creative works. The lengthy Report deals with a wide array of IP matters, but we've compiled some of the highlights below.

Copyright – fair use should be the new deal

Currently under Australian law, if you are not the copyright owner or the copyright owner's licensee there are a select few exceptions available should you seek to use the copyright content without licence or fee. These are known as "Fair Dealing" exceptions and include the use of copyright material for the purposes of: research or study (Section 40), criticism or review (section 41), parody or satire (Section 41A) and reporting news (Section 42). Each of these is tightly regulated with a multi-factor test for determining "fairness" in the dealing having regard to the nature of the work/adaptation, possibility of obtaining the copyright at a commercial price, the effect on potential market value, and the amount or substantiality of the copyright content dealt with and of course the purpose of the dealing as prescribed by the legislation and decided cases.

The Report argues that this system of exceptions operates in a too narrow and inflexible way that is divorced from realities of copyright content use in Australia today. The recommended approach to an exceptions regime is a US-style general exception known as "Fair Use". Unlike, the specific, purpose-based Fair Dealing exceptions, a general Fair Use exception would remove the formal complexities of determining purpose of the use and provide greater certainty as to a number of modern copyright uses not covered by the fair dealing system, although they would otherwise be considered "fair" or legitimate uses. These include use scenarios such as: the publication on an internet search engine result of thumbnail images of websites, the quoting by an author of unpublished letters and journal entries in a biography, the use of opening lyrics of a copyright song as a way of paying homage to that song, or the creation of a collage using images from other copyright photos.1 The significant shake-up proposed is likely to make this recommendation much discussed in the nearer and farther future.

Duration of copyright works – a lifetime's too long!

Apart from making exceptions fairer, the Report has also identified the duration of copyright works and other content as significantly longer than what is necessary to incentivize the creation of most works. The issue appears to be that the commercial lifespan of many copyright works is far shorter than the duration of legal protection of the copyright rights. Based on the Productivity Commission's findings, the commercial exploitation life of copyright materials would rarely exceed 20 years, whilst the duration of legal protection (in many instances) runs for 70 years from the death of the creator. A book published in 2016 by a 35 year old author who lives until 85 would be still protected by copyright laws until 2136 – arguably long after the commercial life of the work.2

According to the Report this disparity indicates that the current duration imposes costs on the community in accessing copyright material for far longer than what is necessary for the commercial incentive to the creators/owners. This could be hindering the creation of fresh works and faster dissemination of ideas far more than necessary for the recognition of the original copyright holders' interests. The optimal term for the duration of legal protection for copyright materials should therefore be closer to 15-25 years after creation.

On an additional note, the Report also took aim at the current state of copyright protection for unpublished works which in Australia are granted copyright protection in perpetuity, which is an anomalous position in relation to other jurisdictions such as the UK, USA, Canada, New Zealand and much of the EU. The large proportion of unpublished copyright protected works such as letters, diaries, recipes, sketches are held in libraries and archives collections across Australia and the effect of perpetual copyright protection for works which remain unpublished is that permission is always required for their use and exploitation and as time elapses the task of tracking down rights holders becomes increasingly difficult. The Report therefore recommends the harmonizing of copyright duration of unpublished works with those of published works whereby if the author's identity is known, the duration will be the author's life plus 70 years and if the author's identity is not known, the duration will be 70 years from the date the work was made.

Trade Marks – clearing up the clutter

Whilst not the most prominent sections of the Report, some trade marks issues and recommendations are also discussed in Chapter 11. The Report raises the concern of an increasingly cluttered Register of Trade Marks in Australia whereby lower quality and broadly cast trade mark applications are being registered and potentially stifling competition in the promotion of goods and services in the market. According to the Draft Report, one effective (although not entirely perfect) measure to address cluttering may be to restore the "mandatory disclaimers" power to the Trade Marks Examiner as existed prior to the 1995 Trade Marks Act. "Mandatory disclaimers" would allow Trade Marks Examiners to grant registration to applications but reign in the scope of elements and/or classes in which the application is made because the elements "disclaimed" would not be afforded Trade Mark rights and protections.

Conceding that there are imperfections of the mandatory disclaimer method such as increased costs, complexity and disruption to the trade mark system, the Report provides some alternative recommendations. Amongst these is the recommendation that the presumption of registrability should be qualified with a presumption that it does not apply to trade marks that could be misleading or confusing and lifting the threshold from "intent to use the trade mark" to "demonstrated use" – although concerns were also raised about the uncertainty that this would create.

The Report also considered abolishing defensive trade marks and increases on the fees for Trade Mark application and registration. Defensive Trade Marks are provided for under Part 17 of the current Act which allows traders who effectively have famous brand reputations in relation to some good/services to register their famous trade mark in goods/services in which they do not offer goods/services. The rationale for allowing defensive trade marks is to prevent confusion that could arise should another trader start using an identical or similar trade mark in another class as for example consumers thinking that Qantas has entered the fitness market should a trader (other than the airline) start offering gym services using "Qantas" as part of the name. The Report notes that whilst defensive trade marks are not extensively used in practice, they are a source of clutter and their immunity for removal for non-use and increase in power for larger traders makes them anticompetitive and unjustifiable as a safeguard to consumer confusion when other remedies such as passing off and the consumer law are available.

Additionally, the Report argues for an increase to the application and registration fees for trade marks as a means to discourage cluttering, particularly by larger firms seeking multiple class registrations. To shield smaller and medium-sized enterprises (SMEs) from the effects of the cost increase, the increase should apply only to registrations in more than one class of goods/services.

Better IP Enforcement for SMEs

In further concern for SMEs, the Report notes the problems of IP enforcement that SMEs face, especially against larger enterprises. Whilst rejecting the ideas of a UK-style dedicated IP Court, the Report does propose a process of reform within the Federal Court system with an emphasis on lower cost of, and informal alternatives to litigation of IP matters and more straightforward dispute resolution options for contentious IP matters with a lower value quantum that could be dealt with in a separate jurisdiction of the Federal Court. Measures such as these could make a significant and positive difference for many SMEs that may have invested in the IP rights, but are daunted by the complexity and resource-intense process of effectively enforcing their rights.

Parallel Imports and the final word on geo-doging your Netflix account

The importation of legitimately trade-marked goods produced in another country such as that cheaper DSLR camera or smartphone you bought online from a trader in Hong Kong can be blocked in Australia by owners and/or licensees of the trade mark in Australia. Of course, Section 123 of the Trade Marks Act has for the most part been there to ensure that parallel imports are allowed, but increasingly the consent of the application of the trade mark by the trade mark owner is becoming difficult to prove such as where the consent may have been restricted, conditional, or implied. The evidentiary and legal burdens increase the risk for consumers and parallel importers which the Report seeks to remedy with the reform of Section 123 to clarify that parallel imports of trade marked goods do not infringe Australian registered trade marks so long as the trade marked goods have been brought to the market in other jurisdictions by the owner or licensee of the trade mark.

And to return to that all important observation with which we began, the Report has acknowledged what many Australian consumers have long protested: price discrimination for IP content across a range of platforms. Australian consumers are according to the Report paying on average 50% more for software, music, 84% more for games, and some 16% more for books. This together with availability and timing of release has been a significant factor in prevalence of geo-dodging and (on a more serious note) piracy by individual consumers in Australia. In fact, geo-dodging, fair use, extensive durations, parallel imports, trade mark clutter and enforcement effectiveness discussed in the Report ultimately project an overall expression for a more economically practical and use-focused approach in the regulation of IP in Australia. In other words, to be in touch with the realities of consumption and exploitation of IP both currently and the projected future, IP laws should be sharpened to respond to commercial realities including consumer behaviors online and elsewhere.

The Draft Report will be open for further written submissions until 3 June 2016 which can be made via the Productivity Commission website:
http://www.pc.gov.au/inquiries/current/intellectual-property/draft#fact

May the tech savvy geo-dodgers be buoyed till then.

Footnotes

1 http://www.pc.gov.au/inquiries/current/intellectual-property/draft/copyright-factsheet.pdf

2 See overview at http://www.pc.gov.au/inquiries/current/intellectual-property/draft#glance

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Kim Leontiev
Patricia Monemvasitis
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Mondaq Advice Centre (MACs)
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.