The Third Amendment to the Copyright Law of China, which takes effect from 1 June 2021, introduces meaningful changes:
1. Definition of Copyright Work Expanded
The law now defines a "work" as "an intellectual achievement that is original in literature, art and science and can be expressed in a certain form". This broad definition opens the door to protection for works not already explicitly enumerated under the law. The definition “audio-visual work” is also introduced to replace the narrower description “works of filmography or created in a way similar to cinematography”. Thus, the revised law extends copyright protection to webcasts, on-line games, game graphics, etc. and so operates to protect artistic creativity in the increasingly commercially important online and new/social media and gaming industries. Foreseeably, there will be no more debates similar to those in the past few years about whether musical fountain shows are copyrighted works.
2. Right of Broadcasting
The scope of the right of broadcasting is expanded from "wireless broadcasting and re-transmission by wire or wireless" to the more simply stated "transmission or re-transmission by wire or wireless". This removes the formerly basic premise that a work first needed to be broadcast by wireless means. The right can now be relied upon to combat web-based infringements, such as pirating of live broadcast of sports, online games, and unauthorized reproduction of music. Previously, rights holders had recourse to the unarticulated "other rights", or else sought relief for unfair competition, which resulted in mixed court decisions.
3. Collaborative Works; Protection for Actors; Ownership of Audiovisual Works
Copyright in a collaborative work can in most cases be exercised by any of the co-authors in the event that no prior agreement can be reached. Any proceeds resulting from such exploitation shall be reasonably distributed among all authors. Previously, it was difficult to exploit collaborative copyright works in the absence of agreement between all co-authors.
The revised law better protects rights of actors, including a right to identify the performer and to protect a performance from distortions. The performing entity (usually the employer of an actor) retains a right to use a performance for free if within its own business scope.
Ownership of audiovisual works is refined. Copyright in films and TV programs will belong to the "producer", but authors such as screenwriters, directors, photographers, composers shall enjoy rights of attribution and a right to receive remuneration under contracts signed with producers. Copyright in other audiovisual works shall be decided according to the parties’ agreement, but in cases of no clear agreement, the producer takes ownership, while other authors enjoy a right of attribution and a right to receive remuneration. These provisions may help the allocation of copyright interests and responsibilities, but disputes could arise in determining the producer.
4. Limitations on Fair Use; Expanded Fair Use for the Disabled
The concept of “fair use” shall not affect the regular use of the work or unreasonably prejudice a right holder’s legitimate interests. Fair use in the context of a free performance of a published work means the public is not charged, performers are unpaid, and performance is not intended for profit. Previously, organizers have tried to claim fair use in offering free performances supported by commercial advertisements. Fair use for the disabled is expanded from translations into braille to “providing published works to persons with disabilities in a way that they can perceive”.
5. Technical Measures for Protection of Copyright
Rights holders may employ technical measures to protect or restrict unauthorized access to copyright works. The law prohibits acts intended to circumvent or avoid such measures with limited exceptions.
6. Collective Copyright Management Organizations
Authorized collective copyright management organizations may claim rights for copyright holders and collect royalties and act in their own name in disputes. They shall be non-profit legal persons. They shall maintain transparency and openness and remain subject to supervision by the national copyright authority. Effectively, they are prevented from managing copyright works for their own profit.
7. Increase in Damages
Statutory damages payable by an infringer are increased to a new maximum of RMB 5 million (US$800,000). Damages shall be calculated based on actual loss suffered by the rights holder or the illegal gains of the infringer. Where the loss or illegal gains are difficult to calculate, damages may be assessed by reference to a royalty of license fee. For serious and intentional infringements, punitive damages of between one to five times the amount determined according to aforesaid method may apply. These accord with the IP provisions under the Civil Code and the previous amendments to other IP laws such as the Trademark Law and the Patent Law.
The changes have been introduced to the law in all key areas, reflecting the developments in technology and responding to the reality needs. While further clarity is still needed on some issues, the law has already widen the net for the rights holders to capture a broader range of hidden and rampant online infringements.