A Preliminary Analysis of Fair Use of Others’ Copyrighted Works in Performances
Bai Fan The High People’s Court of Guizhou Province
Hu Ping The High People’s Court of Guizhou Province
With the vibrant social and cultural life in China, it becomes a commonplace to see people perform the copyrighted work of others in public. Many of such performances are not authorized by the copyright owners and come with legal risks. To balance the interests between copyright owners and the public, the Copyright Law contains limitations, as necessary, to the rights of the copyright owner. It provides for the fair use of a copyrighted work without the permission of the copyright owner.1 However, in practice, the legal provision does not appear as clearly defined as we may have imaged.
Vague boundaries of fair use
In the Copyright Law, a dual structure is used to regulate performances. On one side, Article 19, Paragraph 1, Clause 9 provides for the performance right as one of the rights under the copyright, which means the right to perform a copyrighted work publicly and broadcast the performance of the copyrighted work publicly. On the other side, Article 37, Paragraph 1 provides for the performance of copyrighted works owned by others, where the performer (which can be the actor/actress or troupe) or the performance organizer is required to obtain the permission from and pay to the copyright owner. As one of the limitations to the performance right to copyrighted works, Article 2, Paragraph 1, Clause 9 provides that for the free performance of any published copyrighted work where the public is not charged and the performer is not compensated, no permission from and no payment to the copyright owner may be needed, provided that the name of the author and that of the copyrighted work shall be shown and that no other rights of the copyright owner under the Copyright Law may be infringed.
It seems that the law has been clear in its provisions for the fair use of any copyrighted work owned by another person in performances, where the “free performance” consists of two elements, namely “the public is not charged” and “the performer is not compensated.” In practice, however, the “free performance” is often interpreted to be a “noncommercial performance.” Thus, it becomes necessary to develop an additional element for determining the free performance. People who hold this view generally believe that as new marketing means keep emerging endlessly, it is perfectly possible that the performance organizer and sponsor are benefited financially, even if no fee is charged to the public. This would cause the copyright owner to suffer a damage that he should not have suffered. As the social development has far outpaced what the law has required, the legal provision need be extended and reconstructed.
As far as this author sees it, the above view is reasonable, but how the term “non-commercial” is understood may lead to new problems. When abstractions are used to differentiate between ideas and expressions, as Judge Billings Learned Hand ever said, there is a point in the series of abstractions where [the contents] are no longer protected. This author believes, as he did, that there is a point where a performance is no longer a fair use of the copyrighted work. Individual cases may differ in thousands of ways, but this criterion should apply universally. We need find that point of balance and get as close to it as possible.
Interpretations of data on fair use of copyrighted works in performances
Legislative evolution and definitions
The earliest provision on the fair use of copyrighted works in performances can be found in Article 22, Paragraph 1, Clause 9 of the earliest Copyright Law 1990.
That version of the article has the same numbering as the current one, but uses slightly different wordings, such as “the free performance of any published copyrighted work.”
The Annotations of the Copyright Law, which was published in the same year, commented that the term “free performance” meant “a performance not for business purposes.” It should not include any “charity performance” where although the public was charged, any performance fee payable to the performer was donated. 2 In the Copyright Law 2001, the wording was modified to become how it reads in the current version.
Regarding free performances, the Interpretations of the Copyright Law of the People’s Republic of China, which was published in the same year, contained the same words as in the Annotations to the Copyright Law, that is, the “free performance” meant “a performance not for business purposes.” It went on to explain what a free performance was, saying that this version of the Copyright Law contained an explicit definition (containing two elements) to facilitate the practical implementation.3 The phrase “explicit definition” seemed to suggest that the legislator originally intended that the free performance only consisted of two elements.
In the Draft Revision of the Copyright Law Submitted for Approval as drafted by the Legislative Affairs Office of the State Council in 2014, the wording was changed again. On the basis of the then current version of the Copyright Law, Article 43, Paragraph 1, Clause 9 of the Draft Revision contained an additional element, that is, [and] “no financial gains are made in any other way.” Obviously the change was to respond to and verify the “non-commercial performance” view. It should also be noted that the term “performance not for business purposes” was used in both of the above two interpretations of the Copyright Law.
Article 11 of the Berne Convention provides that a copyright includes the public performance right, which in turn includes the broadcasting right specified in Article 11 bis and the public recitation right specified in Article 11 ter, within the meaning of the Copyright Law of China. But there is no specific exception for the performance right. Article 13 of the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) provides for the general limitations to copyrights in the well-known three-step analysis. That article is sourced from Article 9.2 of the Berne Convention in effect, except that it expands the reproduction right to cover all copyright-related rights. Thereafter, the three-step analysis was also incorporated in the World Intellectual Property Organization Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT) as a standard test to assess the limitations and exceptions to exclusive rights.
Now there have been four ways globally to regulate the fair use of copyrighted works in performances. 1. A general provision is made. It usually contains, among others, the explicit requirement that the performance is “not for profit making purposes,” as well as other requirements that are the same as what the current Copyright Law of China requires; 2. No general provision is made, but limitations are imposed with respect to the performer, the purpose and the venue, for performances in private, for teaching purposes, as a welfare benefit, in a religious ceremony or at a funeral; 3. A dual structure is adopted. In the general provision related scenario, no permission is needed from, but payment has to be made to, the copyright owner. If the performance complies with any specific legal purpose, then no payment is required; and 4.Some countries have exceptions for demonstrations of copyrighted works by its seller or the seller of the broadcasting equipment of the copyrighted work.
Reference can be made to views that professional scholars present in their textbooks. Among scholars from China who study this issue, Wang Qian believes that as no compensation is made to the performer [in a free performance], it can be inferred that the “free performance” should only mean a live performance other than a mechanical performance; the “compensation” can be any fee or compensation that is collected or paid, as appropriate, in any name, as related directly or indirectly to the enjoyment or performance of a copyrighted work; and any charity performance for raising a charity fund is not deemed as a free performance.4 Zhang Jin holds a similar view.5 Wu Weiguang argues that the free performance may also include any mechanical performance which is immediate and has a limited audience. A performance is not free if any income is received for commercial advertisements or from sponsors.6
Among studies done by foreign scholars, Section “Free and non-paid use” of the reputable Copyright and Neighboring Rights believes that the free performance may include performances and music playing at schools, playing of phonograms at special business institutions for demonstrative purposes, as well as private shows and other performances free of charges.7 A Japanese scholar holds that “not for profit-making purposes” should be one of the standalone element for the free use of copyrighted works. The purpose of it, direct or indirect, should not be to make a profit. The indirect purpose can be, for example, a profit-making entity holding a free performance or playing background music in the shop in order to market its products.8
As shown, it is generally accepted in the academic circle that to use fairly the copyrighted work of another person, the performance should not be for profit-making purposes, both di rectly and indirectly. Then, how to determine if any profit is made indirectly? There is not yet explicit and operable standard tests available in the comparative law study or academic research.
Possible legal structure to regulate free performances
From the related provisions in the current Copyright Law, the law has been very strict with exceptions for free performances. The purpose is to develop prosperous culture and meet the needs of the social public and on that precondition, to protect the legal rights and interests of copyright owners to the maximum extent possible and prevent business entities from taking advantage of free performances to promote themselves commercially. The Chinese legis lation has adopted the “general provision” way, which, as appears necessary, need be added with an element that no indirect profit-making act is allowed. To make it more specific, this author believes that the elements specified in the provision can be extended as follows.
First, the fee that is charged to the public should also include any substitutive obligation, such as, to require that the audience has to buy any goods to exchange for the qualification to watch the performance. When, for example, the audience is imposed with the obligation to add the wechat public account to its contact list or repost a piece of information in order to raise more “likes,” it does not seem to have paid any money and its property remains unchanged. In this case, the element that no indirect profit-making should be made can be added to the determination.
Second, the compensation or not for the performer should be determined. Pursuant to the principle of unjust enrichment, it is also profit-making, only in the passive sense, if any expense that should have been made is not made. Thus, a performer should be deemed compensated if any fee that he has to pay is reduced or waived.
Third, indirect profit making or not should be determined. As far as this author sees it, for the lack of specific details and explanations in the current Copyright Law and related theories, some elements from the Unfair Competition Law can be introduced to define such terms as “indirect profit-making” and “free performance” in the Copyright Law. This will achieve a balance of rights and interests in a more proper way, and make the related legal provisions more definite and operable. This is based on the all-inclusive nature of the Unfair Competition Law with respect to intellectual property related laws, and on the implicit intent of the Unfair Competition Law to restrict acts that lead anyone to gain by doing nothing or by hitchhiking and to uphold the principles of honesty and creditworthiness, as well as publicly accepted business ethics.
Specifically, in terms of the subject, to seek for profits means that the performance concerned must have an operator to participate in it. The operator is the subject that organizes the performance or helps with it with respect to funds, garments, props, venues and equipment. He is often the producer or seller or service provider who makes profits and looks for gains. More importantly, in terms of profit-making, with “indirect profit-making”, the operator, though he does not profit directly from the fee that is charged to the audience, becomes able to seize a transactional opportunity, win a competitive advantage or undermine the competitive edge of other operators, through the performance. For example, with a “free performance,” he may take the chance to promote or publicize its business or products, or to upgrade the venue of its services. By so doing, he gets the opportunity and wins the purchasing power.
It should be noted that in determining any indirect profit making act, although the theories and elements of the Unfair Competition Law are borrowed, the conclusion is that the fair use defense of the performer cannot be established. His act infringes the copyright (or the performance right), but does not constitute unfair competition. To go even further, for indirect profit-making, the application of the Copyright Law is in effect to restrict any act that violates the principles of honesty and credit-worthiness and that causes the doer to reap without sowing or to profit by others’ toil. The Copyright Law protects the legal rights of copyright owners, while the Unfair Competition Law protects the legal rights and interests of other competitors and consumers, and maintains the normal order of the market.
（Translated by Ren Qingtao)
1 Whether the fair use under the Copyright Law is a legal right or a cause of non-infringement defense is still under debate in the academic circle. This issue, however, is not involved in this paper.
2 Hu Kangsheng et al, “Annotations to the Copyright Law,” Beijing Normal University Press, 1990, pp. 57-58.
3 Yao Hong et al, “Interpretations of the Copyright Law of the People’s Republic of China,” Mass Press, 2001, pp. 168-169.
4 Wang Qian, “On Copyright Law,” China Renmin University Press, 2015, pp. 359-360.
5 Zhang Jin, “On Copyright Law,” Peking University Press, 2015, Page 167; He Huaiwen, “On the Copyright Law of China,” Peking University Press, 2016, pp. 722-723.
6 Wu Wei Guang, “A Study of the Copyright Law,” Tsinghua University Press, 2013, pp. 424-425.
7 Delia Lypzic [Spain], “Copyright and Neighboring Rights,” China Translation and Publishing Corporation, 2000, pp. 175, 181 and 182.
8 Masao Handa and Nobuo Monya [Japan], “50 Lectures on Copyright Law,” Law Press, 1990, pp. 270-271.