Distributel Communications Limited

May 31, 2021

Filed via electronic mail (copyright-consultation-droitdauteur@canada.ca)

Ministers of Canadian Heritage and Innovation, Science and Industry
Government of Canada

Re: Consultation on a modern copyright framework for online intermediaries – submission of Distributel Communications Limited

1. Distributel Communications Limited (“Distributel”) is pleased to submit these comments in response to the Government of Canada’s consultation on a Modern Copyright Framework for Online Intermediaries (the “Consultation”).  
2. Distributel is one of Canada’s leading independent telecommunications service providers. We offer a full suite of Internet, television, home phone, and long distance services to residential customers, advanced voice and data services to small business and enterprise customers, and IP voice and data wholesale solutions to other telecommunication service providers.
3. We operate a national network and maintain both major network points of presence and offices in Toronto, Ottawa, Montreal, Vancouver, Edmonton, and Edmundston. Strongly committed to growth, we continue to increase our presence across Canada through investments in network and service expansions, as well as strategic acquisitions. We are equally committed to our partnership approach to bridging the digital divide, most recently via our partnership with Eeyou Communications Network to bring state-of-the-art 1-Gbps fibre-optic internet service, television, long-distance and home phone services to the Cree communities of Eeyou Istchee and to the municipalities of the Eeyou Istchee James Bay region in Northern Quebec.
4. In our operations as an Internet service provider (“ISP”), we are a provider of network services as defined in the Copyright Act^{Footnote 1} and, in the context of the present Consultation, we act as an intermediary as we provide the “technical means for communicating content”^{Footnote 2}.  
5. We have significant concerns with the options for reform put forward in the Consultation that would: 1) change the knowledge standard currently applicable to the “hosting” safe harbour such that the mere receipt of a notice of claimed infringement would constitute knowledge of infringement and extend that changed knowledge standard to the “mere conduit” safe harbour^{Footnote 3}; and 2) require intermediaries to implement notification and action mechanisms and mechanisms to deal with repeated alleged infringers based only on the mere receipt of a notice of claimed infringement^{Footnote 4}.
6. These reforms, if enacted, would alter the careful balance that currently exists under the “notice and notice”  framework in a way which prefers one set of interests – that of copyright holders – over the interests of all others.  Distributel accepts that artists and creators must have mechanisms to enforce their copyright, but is very concerned that the proposals inappropriately shift the burden and cost of enforcing those rights onto intermediaries who do not have the necessary resources or expertise on copyright matters to do so.  The cost of enforcing copyright should remain with the party that benefits from the copyright, and copyright holders should bear the risk if they overreach in their efforts to protect their rights. This further serves as an important safeguard to ensure that copyright holders are the ones that must bear the associated costs if they choose overreach in their efforts to protect their rights.
7. Whereas the current notice and notice regime appropriately recognizes that a notice of claimed infringement is an unproven allegation and makes the courts responsible for adjudicating whether copyright infringement has occurred, the reforms contemplated in the Consultation would require intermediaries to effectively accept unproven claims of infringement as fact and take actions of significant consequence against end-users without any due process.  These actions would be based on an unproven allegation from a copyright holder who is not disinterested, and put intermediaries – who have traditionally neither been empowered nor allowed to act other than as a common carrier –  in the middle of disputes between copyright holders and users.
8. In our view, these reforms are unwarranted and unnecessary. The current copyright framework allows copyright holders to address alleged copyright infringement via the notice and notice regime and through recourse to the courts. This framework appropriately places the onus on copyright holders to protect their copyright and ensures that allegations of copyright infringement, which are serious allegations, must be proven and found to be valid by the court. It also protects end-users by ensuring that they are provided due process when subject to an allegation of copyright infringement and establishes  safeguards against frivolous  allegations and unjustified settlement demands. Notably, the Copyright Act had to be amended in 2018 to curtail abuse of the notice and notice regime by copyright holders that were using settlement demands to leverage the fears of regular people who are not familiar with copyright law to extract payment for alleged infringements that they were not entitled to.^{Footnote 5} This type of behaviour is likely to increase if the reforms which are being contemplated are instituted.       
9. We fully comply with our intermediary obligations under the current copyright framework. Importantly, these obligations (i.e., meeting our notice and notice obligations and complying with applicable court orders) do not allow, let alone require, us to take actions (i.e., limiting, suspending, or terminating service to an alleged infringer) based on our judgement alone as to whether an allegation of copyright infringement warrants an action to be taken. Limiting, suspending, or terminating service to an end-user are actions that have significant consequences to end-users and should not be taken solely on the basis of an ISP’s judgement call of the validity of unproven allegations of copyright infringement.  
10. This is not a frivolous concern. For example, allegations of copyright infringement based on the identification of an IP address associated with an alleged infringement and the linkage of that IP address to the person responsible for the alleged activity are subject to numerous potential errors and pitfalls. As stated by the Supreme Court:^{Footnote 6}   

    [35] I acknowledge that there will likely be instances in which the person who receives notice of a claimed copyright infringement will not in fact have illegally shared copyrighted content online. This might occur, for example, where one IP address, while registered to the person who receives notice of an infringement, is available for the use of a number of individuals at any given time. Even in such instances, however, accuracy is crucial. Where, for example, a parent or an employer receives notice, he or she may know or be able to determine who was using the IP address at the time of the alleged infringement and could take steps to discourage or halt continued copyright infringement. Similarly, while institutions or businesses offering Internet access to the public may not know precisely who used their IP addresses to illegally share copyrighted works online, they may be able, upon receiving notice, to take steps to secure its Internet account with its ISP against online copyright infringement in the future.

    [41] It must be borne in mind that being associated with an IP address that is the subject of a notice under s. 41.26(1)(a) is not conclusive of guilt.  As I have explained, the person to whom an IP address belonged at the time of an alleged infringement may not be the same person who has shared copyrighted content online. It is also possible that an error on the part of a copyright owner would result in the incorrect identification of an IP address as having been the source of online copyright infringement. Requiring an ISP to identify by name and physical address the person to whom the pertinent IP address belonged would, therefore, not only alter the balance which Parliament struck in legislating the notice and notice regime, but do so to the detriment of the privacy interests of persons, including innocent persons, receiving notice.

11. Allowing or requiring intermediaries to take actions of such significant consequences based on their unilateral judgement will jettison the presumption of innocence that exists under the current notice and notice regime. This is a central tenant of the current framework that the Government of Canada currently goes to length to emphasize. For example, the Office of Consumer Affairs Notice and Notice Regime Quick Facts and Frequently Asked Questions^{Footnote 7} currently note:

    “Receiving a notice does not necessarily mean that you have in fact infringed copyright or that you will be sued for copyright infringement.”

    “Only a court can rule whether copyright infringement has occurred. If a court finds infringement has occurred, then the infringer could be liable to pay damages to the copyright owner.”

    “It is possible that the notice refers to acts that were undertaken by someone using your Internet connection without your knowledge. You may want to ensure that your home network is secured by a strong password to prevent others from using your Internet connection to engage in copyright infringement.”

12. As an ISP, we are not experts on copyright law and copyright infringement. As a result, we are not the best party to determine whether an allegation of copyright infringement is valid or otherwise warrants an action to be taken. Requiring ISPs to undertake investigations to determine the validity of allegations of copyright infringement – to the extent that it is even possible to do so – would require them to not only investigate whether an alleged copy infringement occurred, but also whether the party making the claim is the valid owner of the copyright. None of this is within an ISP’s expertise, nor should it be. Significant resources would be required to undertake these activities. Many ISPs, like Distributel, would have to hire additional staff and develop IT and other systems and processes to deal with the additional investigation and action obligations imposed on them. The costs of these additional activities are not currently factored into rates, and absent a mechanism whereby the rightsholders reimburse these costs (something which has not, to date, be fully implemented in the notice and notice regime), these costs would likely fall to consumers in the form of increased Internet service rates. In our view, that does not fairly reflect who should be responsible for the costs of enforcing copyright.
13. These specific reforms will create the wrong incentives for both copyright holders and intermediaries. In Canada, there is a potentially fundamental conflict of interest involved in having an ISP adjudicate and enforce allegations of copyright. Canada’s large, vertically integrated incumbents hold copyright on a significant amount of popular content. This creates a significant incentive for those parties to use their positions as ISPs to enforce that copyright in ways they could not do so only as rightsholders. Today, when a vertically integrated incumbent operates as an ISP, it must respect the safeguards inherent in the notice and notice regime before it can take actions of significant consequence against its end-users at the behest of its own media and broadcast arm. If the reforms being considered are implemented, vertically integrated incumbents will be given significant and inappropriate discretion to limit, suspend or terminate service to any of its end-users that are subject to an infringement claim related to copyright held by the incumbent. Allowing these types of actions to be taken in such a scenario based simply on whether the incumbent “believe(s) it would be justified” is inappropriate and ripe for abuse.
14. Further, there is a potential anti-competitive dimension for ISPs which are not integrated with rightsholders.  For example, copyright holders will have incentives to pressure intermediaries to take action on unproven allegations of copyright infringement and, should an intermediary refuse to do so, threaten to seek recourse regarding the intermediary’s alleged failure to perform its obligations. Copyright holders affiliated with intermediaries may see the benefit of targeting claims towards the end-users of intermediaries that compete against them as a means to increase their competitors’ costs and target their end-users. While we cannot guarantee that these specific types of abuse will occur, one needs to look no further than the settlement demand rules, as discussed above, that had to be put in place to stem the abuse of the notice and notice regime to eliminate any doubt that some parties will seek to abuse these new powers and permissions in some fashion.
15. The proper entity to make the determination of whether there has been copyright infringement is an independent third party like a court or regulatory tribunal. Allegations of copyright infringement are serious matters that may have significant repercussions. It is therefore inappropriate to substitute the judgements of the courts with the judgement calls of ISPs, regardless of how expedient or convenient rightsholders may believe that to be relative to the balanced framework that currently exists.  
16. For all these reasons, we ask that the Government of Canada not implement the reforms contemplated in the Consultation regarding changes to the knowledge standard and the application of that standard to the “mere conduit” safe harbour or that would require or allow intermediaries to implement notification and action mechanisms or mechanisms to deal with repeated alleged infringers.

All of which is respectfully submitted,

Original signed by

Christopher Hickey

Director, Regulatory Affairs