Minimum fees for licensing copyrights in existing artistic works, is eligible for inclusion in scale agreements under Status of Artist Act

Supreme Court of Canada: In this case questions arose as to whether artists association are prevented from bargaining minimum fees for using existing artistic works in agreements, under Status of Artist Act (“SAA” in short) and whether allowing such agreements which impose such fees for provisions of copyrights, are in conflict with Copyright Act. The Court held that licensing of copyright in existing works can be subjected to binding minimum fees set forth in scale agreements under SAA, provided that such agreements are not binding on collective societies established under the Copyright Act. The collective bargaining conducted by artists’ associations in respect of scale agreements covering the licensing or assignment of copyrights to existing artistic works does not contradict any provision of the Copyright Act, nor do the scale agreements bind collective societies governed by that same Act.

Briefly stated, the facts of the case are that in 2003, CARFAC and RAAV, certified artists’ associations for Canadian visual artists, jointly commenced negotiating a scale agreement with the National Gallery of Canada (“NGC”) which lasted for 4 years. Later on, NGC obtained a legal opinion due to which it refused to include minimum fees in the scale agreement, for licensing or assignment of the copyright in existing artistic works. CARFAC and RAAV filed a complaint with the Canadian Artists and Producers Professional Relations Tribunal that NGC had failed to bargain in good faith. The Tribunal held that NGC failed to bargain in good faith by adopting an uncompromising position based solely on one legal opinion. It should have known that this would not be accepted by CARFAC/RAAV. Agreeing with this view the Court allowed the appeal and held that the minimum fees for the provision of artists’ copyrights for existing works are eligible for inclusion in scale agreements. If minimum fees is excluded from scale agreements, it would put an impact on Parliament’s express recognition that artists should be compensated for the use of their works, including the public lending of those works.Canadian Artists’ Representation v. National Gallery of Canada, 2014 SCC 42, decided on 12 June, 2014

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