Two bills effecting numerous changes to the copyright law of the United States were enacted on October 27 and 28, 1998. The bill enacted on October 27 includes provisions extending the term of United States copyright protection, permitting the playing of musical works originating from a radio or television broadcast in small shops and eating and drinking establishments without the need to obtain a copyright license and creating a mechanism whereby individual owners of a small number of establishments open to the general public for which a license is required to perform musical works may obtain a determination of what is a reasonable license rate or fee for such performances. The bill, enacted on October 28, includes provisions for the implementation of the WIPO Copyright Treaties relating to the application of copyright law to digital technologies, provisions limiting liability for copyright infringement for on-line providers and a provision creating a new form of protection for designs of useful articles which make the article attractive or distinctive in appearance and for designs of vessel hulls. Major features of these laws are as follows.

Under the new law, which came into effect immediately upon enactment and is known as the Sonny Bono Copyright Term Extension Act, the normal term of copyright for works created on or after January 1, 1978 is extended to a period of the life of the author plus 70 years. This amendment brings the term of protection in the United States into line with that in the European Union (see Information Letter N.S. 182). In the case of anonymous works, pseudonymous works and works made for hire the term of protection is extended from 75 years from first publication or 100 years from creation, whichever expires the earlier, to 95 years from first publication or 120 years from creation, whichever expires the earlier. For works created before January 1, 1978, not published or copyrighted before that date, but published before December 31, 2002, copyright will now expire on December 31, 2047. For works that were copyrighted before January 1, 1978, the renewal term for any work still in its first term of protection on January 1, 1978 is extended to 67 years and the duration of any copyright that was in its renewal term on January 1, 1978 now becomes 95 years from the date on which protection was originally secured. During the last 20 years of the life of a copyright in a published work, however, libraries and archives may provide copies of copyright works for purposes of preservation, scholarship or research as long as the library or archive is satisfied after having made reasonable investigation that the work is not subject to normal commercial exploitation or otherwise obtainable at a reasonable price.

The Fairness in Music Licensing Act, which came into effect on January 25, 1999, provides that stores and shops having an area of less than 2,000 gross square feet and food service and drinking establishments of less than 3,750 gross square feet are, subject to certain limitations as to the number of loudspeakers and the size of any television screen employed, granted an exemption from the copyright law for the purpose of transmitting or retransmitting non-dramatic musical works intended to be received by the general public and originating from a radio or television broadcast station, or in the case of audiovisual transmission from a cable system or satellite carrier. The exemption only applies if no direct charge is made for viewing or hearing the work and as long as there is no further retransmission of the work beyond the establishment in which it is received.

The new law also makes it easier for proprietors who own or operate fewer than seven non-publicly traded establishments in which nondramatic musical works are performed publicly under a copyright license for such performance to obtain a determination of a reasonable royalty for such a license notwithstanding the existence of a consent decree relating to the settlement of antitrust actions against performing rights societies which have hitherto determined the rates to be charged for such licenses.

The new law effects the changes in U.S. law to implement the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty discussed in our Information Letter N.S. 188. The most significant changes effected by the new law are 1) to provide that from October 28, 2000 it shall in general be unlawful to circumvent a technological measure that effectively controls access to a protected work and 2) to make it unlawful to provide false copyright management information or intentionally to remove or alter any copyright management information. In addition to exposure to civil action by those who have been harmed by such unlawful acts, violation of either of these provisions for commercial advantage or private financial gain may result in fines of up to $500,000 and/or five years' imprisonment for the first offense and fines of up to $1,000,000 and/or ten years' imprisonment for any subsequent offense.

During the period before the law takes full effect, the Librarian of Congress is to make a determination as to whether rules are required to make exceptions from the general prohibition to prevent the new law from having an adverse effect on non-infringing uses of particular classes of work. A number of exceptions from the law are specifically set out including circumvention of such technological measures in the course of analyzing those elements of a program as are necessary to achieve interoperability with an independently created computer program or in the course of carrying out research into encryption technology.

As from April 28, 2000, most analog video cassette recorders and camcorders made, imported or offered to the public in the United States will have to conform to automatic gain control copy control technology. Furthermore it will be unlawful with immediate effect to manufacture, import or offer to the public most analog video cassette recorders and camcorders if they had been fitted with automatic gain control copy control technology and they had been modified so that they no longer conform to that technology.

Service providers are relieved from the possibility of liability for damages and benefit from a limitation on the forms of injunction that can be granted against them for copyright infringement in certain circumstances when the service provider has provided for connections for transmission of a copyright work through a system or network or has effected intermediate or transient storage of such a work in the course of such transmission. To qualify for this reduced liability, (a) the transmission of the material must have been initiated by someone other than the service provider, (b) the transmission or storage in question is carried out by automatic technical means, (c) the service provider does not select the recipients of the material being transmitted, (d) no copies of the work are made other than those needed for transmission to the anticipated recipients and (e) the material is transmitted without modification of its content.

Design Protection of Boat Hulls by Registration at the Copyright Office

The new law will provide that for a trial two-year period it will be possible to secure protection for designs by way of registration in the Copyright Office. To qualify for protection the design must be either:

However, the definition of "useful article" is effectively restricted to boat hulls and articles used in their production.

Under this provision, protection can be secured for a ten-year period but will terminate on the grant of a design patent for the same design.

Other provisions of the new law permit the making of an extra temporary back up copy of a program being used on a computer while that computer is undergoing maintenance or repair, amend the law relating to copyright exemptions for libraries and archives and effect certain modifications in the scope of exclusive rights in sound recordings relating to on line activities and ephemeral recordings. Additional changes relate to the making of sound recordings for the benefit of transmitting organizations and the law relating to certain contractual obligations in connection with the transfer of rights in motion pictures.