World Intellectual Property Organization

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ORIGINAL: English
DATE: August 30, 1996

WORLD INTELLECTUAL PROPERTY ORGANIZATION

GENEVA

DIPLOMATIC CONFERENCE
ON
CERTAIN COPYRIGHT AND NEIGHBORING RIGHTS
QUESTIONS

Geneva, December 2 to 20, 1996

BASIC PROPOSAL
FOR THE SUBSTANTIVE PROVISIONS OF THE TREATY ON CERTAIN QUESTIONS CONCERNING THE PROTECTION OF LITERARY AND ARTISTIC WORKS TO BE CONSIDERED BY THE DIPLOMATIC CONFERENCE

prepared by the Chairman of the Committees of Experts

on a Possible Protocol to the Berne Convention
and on a Possible Instrument for the Protection of the Rights of Performers and Producers of Phonograms


Draft Treaty

Notes on Article 8

8.01 Authors of literary and artistic works have not been granted a general right of distribution under any existing international agreements. The Berne Convention contains a right of distribution only in respect of cinematographic works.

8.02 During the discussions that led to the proposed Treaty, it became clear that the principle of a broad right of distribution has gained wide international acceptance. However, no convergence of views has developed in respect of the scope or extent of the right of distribution after the first sale or other transfer of ownership of a copy of a work. National legislation differs in this respect. In many jurisdictions, the principle is that in respect of a copy of a work the right of distribution ceases to exist, i.e. is exhausted, after the first sale of that copy. Views differ as to whether the exhaustion should be national, regional or global.

8.03 In many legal systems, the right of rental is considered to be a part of the general right of distribution, and it could even in an international instrument be dealt with in that context. For practical reasons, the right of rental is dealt with as a separate issue in Article 8 of the proposed Treaty. This structure follows the way in which these issues were approached during the preparatory stages.

8.04 Article 8 provides an exclusive right of distribution to authors of literary and artistic works. Because of the differences described in Note 8.02, two alternatives are offered. Alternative A is based on the principle of national or regional exhaustion. Alternative B allows global or international exhaustion. The basic provision on the right of distribution is identical in both alternatives: authors shall enjoy the exclusive right of authorizing the making available to the public of the original and copies of their works through sale or other transfer of ownership. Public lending falls outside the scope of this provision since it does not involve a sale or other transfer of ownership.

8.05 Alternative A also provides a right of importation, in addition to the general right of distribution, to the authors of literary and artistic works.

8.06 Paragraph (1) of Alternative A provides the exclusive right. Paragraph (2) allows Contracting Parties to provide in their national legislation that the right of distribution will not apply in respect of copies of a work that have been distributed with the consent of the rightholder in the territory of a Contracting Party. The right of importation is not affected by the first sale or other transfer of ownership. Paragraph (3) excludes from the scope of the right of importation those situations where the importation is effected by a person solely for his own personal and non-commercial use.

8.07 Some proposals presented for the February 1996 session of the Committee of Experts suggested that regional economic integration areas with their own legislation in this field might be explicitly mentioned in the clause concerning national or regional exhaustion. The obligations of the Treaty apply only to regional economic integration areas or organizations that are Contracting Parties to the Treaty. The territories of these Contracting Parties consist of the territories of their member countries. There is thus no need to make separate mention of regional economic integration areas.


Article 8

Alternative A

Right of Distribution and Right of Importation

(1) Authors of literary and artistic works shall enjoy the exclusive right of authorizing:

(i) the making available to the public of the original and copies of their works through sale or other transfer of ownership;

(ii) the importation of the original and copies of their works, even following any sale or other transfer of ownership of the original or copies by or pursuant to authorization.

(2) National legislation of a Contracting Party may provide that the right provided for in paragraph (1)(i) does not apply to distribution of the original or any copy of any work that has been sold or the ownership of which has been otherwise transferred in that Contracting Party's territory by or pursuant to authorization.

(3) The right of importation in paragraph (1)(ii) does not apply where the importation is effected by a person solely for his personal and non-commercial use as part of his personal luggage.


8.08 Alternative B allows for international exhaustion. Contracting Parties may, in their national legislation, provide that the right of distribution will not extend to distribution after the first sale or other transfer of ownership of the original or copies of a work by or pursuant to authorization. The first sale or transfer of ownership may have taken place in the Contracting Party or anywhere else.

8.09 No right of importation is provided for in Alternative B.

8.10 The two Alternatives presented in Article 8 reflect the genuine diverging views of many nations in this matter. On the level of an international agreement the Alternatives seem to exclude each other, are apparently contradictory and impossible to reconcile. As an intermediate solution the introduction of agreed conditional limitations of the right of distribution and right of importation, based on Alternative A in Article 8(1), could be explored. National legislation of a Contracting Party could for example provide that these rights do not apply to the distribution or importation of copies of works that have been sold with the consent of the author anywhere in the world, if copies of that work have not been made available in a Contracting Party in a quantity sufficient to satisfy the reasonable needs of the public, within an agreed period of time, e.g. one year, calculated from the publication of that work outside that Contracting Party. An alternative along these lines has not, however, been presented. Any third alternative would have required extensive international consultations which it would not have been possible to organize during the preparation of the proposed Treaty.

8.11 The rights provided for in the proposed Treaty, including the right of distribution, are minimum rights. Contracting Parties may provide a higher level of protection. A more restricted concept of exhaustion than international exhaustion represents a higher level of protection. Thus, the solution in Alternative B would not preclude any Contracting Party from applying any conditions or restrictions to the circumstances giving rise to exhaustion. National or regional exhaustion is in full conformity with this provision for those Contracting Parties that take this approach to the distribution right. Introduction of a right of importation is not excluded either.

8.12 The main contents of Alternative A follow the proposal made by the United States of America for the February 1996 session of the Committees of Experts. As far as the basic right is concerned, Argentina and Uruguay presented proposals with the same effect but without offering a proposal concerning exhaustion. Alternative B is based on the main approach taken in the proposals made by Australia, Brazil, Canada, Japan, and the Republic of Korea. The group of African countries favoured the international exhaustion of the right of distribution and supported the proposal made by Australia.

[End of Notes on Articles 8]


Alternative B

Right of Distribution

(1) Authors of literary and artistic works shall enjoy the exclusive right of authorizing the making available to the public of the original and copies of their works through sale or other transfer of ownership.

(2) A Contracting Party may provide that the right provided for in paragraph (1) does not apply to distribution after the first sale or other transfer of ownership of the original or copies of works by or pursuant to authorization.

[End of Article 8]


 

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