Center for Advanced Study & Research on Intellectual Property

 

CASRIP Newsletter - Summer 2009, Volume 16, Issue 3

Does Japanese Copyright Law Need Fair Use?

By Keiko Tominaga*

Ms. Tominaga is a 2009 graduate of the Graduate Program in Intellectual Property Law and Policy at the University of Washington School of Law

Table of Contents

I. Introduction

II. International Standards for Exceptions and Limitations

A. Three-step test of the Berne Convention

1. The First Step: “Special Case”

2. The Second Step: “Conflict with Normal Exploitation”

3. The Third Step: “Unreasonable Prejudice to the Legitimate Interest of Authors”

B. TRIPs Agreement and WTO Panel

1. Article 13 of the TRIPs Agreement

2. Overview of Dispute between EC and U.S. at WTO

3. Interpretation of Three-step Test by WTO Panel

III. The U.S. Fair Use Doctrine

A. Purposes and Nature of Codification

B. Ambiguous Application of the Four Factors

IV. The U.S. Compliance With International Standards

A. Fair use and the Three-step Test of the Berne Convention

B. Fair use and the WTO Panel

V. Concerns For Adopting The U.S. Fair Use Doctrine In Japan

A. Structure of Copyright Legislation in Japan

B. The Provisions of Exceptions and Limitations in the Japanese Copyright Act

C. Key Players in Copyright Policy

D. Issues for Discussion

1. Incompatibility with International Law

2. The Legal System and Culture in Japan

3. Advantages of Enumerated Exceptions

4. Fair Use as a Response to New Technology

5. Japan’s Copyright Law already allows for Fairness

VI. Conclusion

I. Introduction

Whether the Japanese Copyright Act should adopt the fair use doctrine is one of the hottest topics among copyright scholars and relevant stakeholders in Japan. In the process of this discussion, some concerns such as incompatibility of the U.S. fair use doctrine with international law and the differences between the copyright systems in the United States and Japan have been highlighted. In addition, the respective legal systems and cultures of each country are regarded as important factors to consider when evaluating whether a legal principle in one country will work well in another country.

In February 2002, then Japanese Prime Minister Junichiro Koizumi expressed his determination to establish an intellectual property strategy in his general policy speech at the Diet. It was the first time that a Japanese Prime Minister had declared that intellectual property should be utilized strategically as a national policy. As a result, the Strategic Council on Intellectual Property was inaugurated in March, 2002.[1] In addition, the Intellectual Property Basic Act, which states the basic policies and principles of intellectual property, was enacted in November, 2002.[2] Further, the Intellectual Property Strategy Headquarters,[3] whose members consist of all ministers and experts from the academic and industrial sectors, was established in March 2003. The Intellectual Property Strategy Headquarters have published the Intellectual Property Strategic Program every year since 2003, which includes principal copyright policies. Thus, in Japan the importance of protection for intellectual property rights has been recognized more and more in recent years.

In March 2008, the expert panel on intellectual property systems in the digital network era (Panel) was formed by the Intellectual Property Strategy Headquarters, and it published its report in November 2008.[4] Inexpensive and immediate access to information for all people everywhere has been realized along with a corresponding recognition of the importance of copyright law in the digital era.[5] Many stakeholders have been forced to review whether the appropriate balance between the rights of content owners to protect their works and the rights of the public to use or build on works has been kept in a reasonable manner. Taking these considerations into account, the report reviews the copyright system in the digital era and includes a recommendation for adopting a fair use-like provision in the Japanese Copyright Act. As a result, whether the U.S. fair use doctrine needs to be introduced in Japan has become one of the hottest issues among scholars and government entities that are involved with copyright legislation.

The U.S. fair use doctrine has been considered “the most troublesome in the whole law of copyright”[6] and it may violate the so-called three-step test, a core minimum standard for copyright protection originally codified in the Berne Convention for the Protection of Literary and Artistic Works (Berne Convention).[7] With the recent proliferation of international, regional, and bilateral treaties associated with copyright protection, the three-step test has been considered a primary standard for measuring the legality of exceptions and limitations on copyright. For example, the three-step test is incorporated into the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs Agreement),[8] as well as the World Intellectual Property Organization (WIPO) Copyright Treaty (WCT),[9] and the WIPO Performances and Phonograms Treaty (WPPT).[10] Therefore, the three-step test is almost the “common-sense rule” that any member state should follow.

Because the United States has a significant intellectual property market, it has played an important role in the international legal regime. Other countries, including Japan, take into account the U.S. legal system when they consider amendments to their own laws. In particular, the U.S. fair use doctrine, which permits the relatively generous use of copyrighted content without permission of the copyright holders, has been brought to the attention of the Japanese government, scholars and relevant industries.

This paper will examine whether the U.S. fair use doctrine should be incorporated into the Japanese Copyright Act. First, the three-step test of the Berne Convention as an international standard for copyright use exceptions and limitations will be introduced. Second, the U.S. fair use doctrine- its nature and scope, history of codification, and problematic aspects- will be briefly discussed. Third, whether the United States fair use doctrine complies with international law will be explored. Fourth, this paper will discuss the proposal to adopt a fair use-like provision in Japan. Finally, this paper concludes that introduction of the U.S. fair use doctrine in the Japanese Copyright Act is unnecessary at this point and provides suggestions for the future discussion.

II. International Standards for Exceptions and Limitations

A. Three-step test of the Berne Convention

The Berne Convention protects a broad range of works, including every literary, scientific and artistic works, whatever may be the form of expression. It is a multilateral treaty that sets minimum standards for the protection of literary and artistic works for all member states.[11] Member states including, the U.S. and Japan as signatories, must comply with the Berne Convention by providing appropriate domestic laws.[12]

Article 9(2) of the Berne Convention provides the so-called three-step test.[13] The 1967 WIPO Stockholm Conference, aimed at revising the Berne Convention, first introduced the test.[14] Before the Stockholm Conference, the right of reproduction, although recognized as the most fundamental right, was not expressly provided in the Berne Convention.[15] During the preparatory work of the Stockholm Conference, it had been recognized that the right of reproduction must go along with provisions concerning the scope and conditions for the application of exceptions and limitations to the reproduction right.[16] The scope and conditions of exceptions and limitations were incorporated into the three-step test in Article 9(2).[17]

Records of the 1967 Stockholm Conference present the following analysis: If it is considered that the reproduction conflicts with the normal exploitation of the work, then the reproduction is not permitted at all. If it is considered that the reproduction does not conflict with the normal exploitation of the work, then the next step would be to consider whether it unreasonably prejudices the legitimate interests of the author. Only if this is not the case, would it be possible, in certain special cases, to introduce a compulsory license, or to provide for use without payment.[18] The meaning of each of these three steps is explained in the following section.

1. The First Step: “Special Case”

“Special cases” is the first condition to be analyzed, not only because it is the first one mentioned in the text, but because it is obvious that if this condition is found then the coverage of a proposed exception is broader than a special case and the other two conditions do not need to be examined.[19] The concept of “special cases” includes two aspects: (1) any exception or limitation must be limited in its coverage, and no broad exception or limitation with a general impact is permitted; and (2) there must be some specific and sound legal or political justification for its introduction.[20]

When it comes to the first prong, it is easy to understand and it may hardly be reasonably questioned.[21] The second prong comes from provisions of the Berne Convention regarding special cases, the Stockholm Conference has introduced exceptions and limitations based on specific public and cultural policy consideration.[22] For example, Article 10(1), which provides exceptions for quotations, states that free quotations are only possible if “their extent does not exceed that justified by the purpose.” The purpose of this article is the clear public policy of guaranteeing study, criticism and free speech.[23] In short, according to the records of the Stockholm Conference, the public policy foundation for special cases covered by the Berne Convention is considered to require more justification than a statement that policy-makers wish to achieve an unspecified kind of political objective.[24] Instead, it requires a clear and sound political justification, such as freedom of expression, public information, or public education.[25] Thus, an author’s rights cannot be limited in an arbitrary way.[26]

2. The Second Step: “Conflict with Normal Exploitation”

The meaning of “exploitation” is clear: the copyright owner may employ his exclusive right to authorize reproduction of his work.[27] In addition, with respect to the interpretation of the word “normal,” the records of the Stockholm Conference mention that “all forms of exploiting a work which had, or were likely to acquire, considerable economic or practical importance must be reserved to the authors; exceptions that might restrict the possibilities open to authors in these respects were unacceptable.”[28] This context supports the condition that the use “does not conflict with a normal exploitation of the work.” This became a part of the text of Article 9(2).[29]

3. The Third Step: “Unreasonable Prejudice to the Legitimate Interest of Authors”

No direct and explicit guidance may be found in the text of the Berne Convention or in the records of the Stockholm Conference regarding the third step.[30] However, the conference had considered the term “legitimate interests” in its “legal interest” sense, and the word “not unreasonably” had been intended to offer an appropriate basis for determining the permissible scope of the exception.[31] That is, any exception to the right of reproduction must inevitably prejudice the author’s interests, therefore, the term “unreasonable” attempted to limit that prejudice.[32]

B. TRIPs Agreement and WTO Panel

1. Article 13 of the TRIPs Agreement

In addition to the Berne Convention, the TRIPs Agreement is also one of the important international laws regarding intellectual property rights. The TRIPs Agreement, administered by the WTO, sets minimum standards of intellectual property protection that WTO member states agree to implement and enforce.[33] Unlike the Berne Convention, the TRIPs Agreement contains a dispute settlement mechanism that a WTO member state may request for a WTO Panel on an allegation of non-compliance against another member state.[34] Once the Panel has issued a decision, the WTO may enforce trade sanctions against a member who fails to comply with that decision.[35] Therefore, the TRIPs Agreement is more practical than the Berne Convention from the perspective of enforcement, and member states including Japan should be aware of the influence of a WTO Panel decision considering not only financial damage, but the bad repute of violators.

Article 13 of the TRIPs Agreement requires members to confine the exceptions and limitations of a copyright holders’ exclusive rights to “certain special cases which do not conflict with a normal exploitation of the work and do not unreasonably prejudice the legitimate interests of the right holder” under member states’ domestic laws.[36] This provision adopts the language of Article 9(2) of the Berne Convention, which is functionally identical other than the scope of the governed rights: Article 13 of the TRIPs Agreement is broader because it covers all of the bundled exclusive rights of the copyright holder, while, Article 9(2) of the Berne Convention provides specifically for the copyright holders’ reproduction right.[37] Accordingly, the TRIPs Agreement also adopts the three-step test of the Berne Convention.

Further, integration of the three-step test into the WCT and WPPT carries the significant role of strengthening international protection for copyright. The WCT and WPPT represent a leap forward in expanding the scope of the three-step test. First, similar to Article 13 of the TRIPs Agreement, the WCT and WPPT make the three-step test applicable to all copyright categories covered in the Berne Convention.[38] Second, the three-step test targets any limitations that constrain the exercise of the new economic rights (e.g. the right of making available) as well as the broadened reproduction right under the WCT and WPPT.[39] In sum, the WCT and WPPT also contain the three-step test provision, an icon of importance for copyright in the digital age.

2. Overview of Dispute between EC and U.S. at WTO

Next, the dispute between the European Commission (EC) and the United States at the WTO will be examined because it shows the WTO’s view with respect to the relationship between the three-step test and the U.S. Copyright Act. This dispute deals with Section 110(5) of the U.S. Copyright Act, the Fairness in Music Licensing Act,[40] which allows businesses such as restaurants to perform radio and television transmissions in specified circumstances. This WTO Panel decision is worth mentioning because it was the first time an international adjudicative body had interpreted either Article 13 of the TRIPs Agreement, or Article 9(2) of the Berne Convention.[41] The WTO Panel concluded that Section 110(5) of the U.S. Copyright Act, which is one of the United States’ listed provisions of exceptions and limitations, violates the three-step test. Section 110(5) is not considered to properly confine the scope of exceptions and limitations by WTO.

The purpose of Section 110(5) of the U.S. Copyright Act is “to exempt from copyright liability anyone who merely turns on, in a public place, an ordinary radio or television receiving apparatus of a kind commonly sold to members of the public for private use.”[42] The core rationale is that the secondary use is so remote and minimal that no further liability should be imposed.[43] This subsection applies to specified retail and food establishments that use radio or television for the enjoyment of their customers.[44] If such an exception did not exist, playing the television or radio in a public setting without paying a license fee would infringe certain rights of copyright owners protected by the TRIPs Agreement to publicly communicate their works.[45]

Following the enactment of the Fairness in Music Licensing Act (FMLA), in January 1999 the EC requested to have consultations regarding the legality of the “small business” exemption provisions at the Settlement of Disputes Understanding (DSU) of the WTO.[46] The initial discussions were failed, and the EC requested that the Dispute Settlement Body (DSB) of the WTO establish a panel.[47] The panel met with the parties in November and December of 1999, and its final report was submitted to the parties on May 5, 2000.[48] It concluded that Section 110(5) of the U.S. Copyright Act does not comply with the three-step test.

3. Interpretation of Three-step Test by WTO Panel

The EC contended that the United States had breached its obligation to comply with the TRIPs Agreement.[49] The United States’ defense was that Section 110(5) of the Copyright Act was permissible as an exception under Article 13 of the TRIPs Agreement.[50] In the U.S. view, if the purpose of an exception is relevant, the TRIPs Agreement only requires that an exception has a specific policy objective.[51] It does not impose any requirement with respect to the legitimacy of the policy objectives that a particular country might consider special in its own history and national priorities.[52]

To begin with, the WTO Panel analyzed the term “certain special cases.” First, it said that exceptions and limitations on copyright provided in national legislation should be “clearly defined” so that they guarantee a sufficient degree of legal certainty.[53] Nonetheless, it is not necessary for national legislation to identify explicitly each and every possible situation to which the exception could apply, as long as the scope of the exception is known and particularized.[54] Second, exceptions and limitations should also be narrow in scope and reach.[55] This means a limitation “must be limited in its field of application or exceptional in its scope.”[56] Third, the examination of public policies underlying a limitation is not a necessary part of the inquiry into whether the first condition of the three-step test is met finding that the abovementioned two requirements are enough to show a limitation’s compliance with the first step of the three-step test, even if there is no public policy.[57] However, the public policy purpose embodied in the limitation may be useful from a factual perspective for making inferences about the scope of the exceptions and limitations or the clarity of a definition.[58]

In sum, the public policy is one of the important inquiries whether the first condition of the three-step test is met, but it may be a subsidiary relevance. More importantly, exceptions and limitations in national legislation should be clearly defined and narrow in scope and reach. The Panel Report mentions that both the EU and the United States admit that a copyright limitation must meet this requirement to achieve full compliance with the first step.[59] The Panel Report’s interpretation was supported by many of commentators, [60] and the Report’s construction of the first step of the three-step test appears reasonable.[61]

With respect to the second step of the three-step test, the WTO Panel first looked at the ordinary meaning of the term and defined “exploitation of the work” as the uses and activities in which copyright holders engage “to extract economic value from their rights to those works.”[62] The term “normal exploitation” did not have to mean the full exploitation of rights, but a “use from which an owner would ordinarily expect to receive compensation.”[63] If uses that are covered by copyright, but exempted under exceptions and limitations enter into economic competition in the ways that right holders normally extract economic value from that right, such uses deprive right holders of significant or tangible commercial gains.[64]

Moreover, the WTO panel found the three conditions of the third step of the three-step test. First, right holders’ “legitimate interests” cover those “that are justifiable in the light of the objectives that underlie the protection of exclusive rights.”[65] Second, right holders’ legitimate interests are unreasonably prejudiced “if an exception or limitation causes or has the potential to cause an unreasonable loss of income” to the right holder.[66] In calculating the loss of income, the panel emphasized that both actual and potential effects on the right holder’s market should be considered.[67] Third, unreasonable prejudice can be supplemented by the payment of compensation from the compulsory licensing system.[68] However, there was no scheme for compensation under Section 110(5).

In summary, the WTO Panel Report on Section 110(5) of the U.S. Copyright Act marks the first time the international adjudicative body interpreted the three-step test. The Panel Report explained the nature and scope of the three-step test and provides guidance to how the test could be applied in measuring the legality of exceptions and limitations.[69] The United States argued that “public policy” should be considered to satisfy the first step of the three-step test. However, the Panel concluded that “certain special cases” should not lightly be equated with “special purposes.” In addition, the Panel found that Section 110(5)(B) conflicted with the “normal exploitation of the work.” Further, the Panel concluded there was “unreasonable prejudice,” and recommended that “the Dispute Settlement Body request the U.S. to bring Section 110(5)(B) into conformity with its obligations under the TRIPs Agreement.”

The fact that Section 110(5) does not satisfy the first step of the three-step test is important for the analysis of the U.S. fair use’s incompatibility with international law because the U.S. fair use doctrine may similarly conflict with the first step of the three-step test, as mentioned later. If specific provisions for exceptions and limitations do not satisfy the scope of “certain special cases,” then fair use, the general provision of exceptions and limitations is not likely to satisfy it either. In addition to the records of the Stockholm Conference, the WTO’s interpretation of the three-step test, which tells us that “certain special cases should be “clearly defined” is legitimate guidance for introduction of the fair use debate in Japan.

III. The U.S. Fair Use Doctrine

A. Purposes and Nature of Codification

Section 107 of the U.S. Copyright Act provides that “the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords, . . . for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright.”[70] With respect to the codification of the fair use doctrine, Congress intended merely to “restate the present judicial doctrine of fair use, not to change, narrow, or enlarge it in any way.”[71] By the time of its codification, courts had evolved the four standards of fair use in Section 107: (1) The purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work.[72]

In Folsom v. March, [73] the first fair-use case, the court commented that the interplay between copyright law and fair use made it difficult to arrive at any satisfactory conclusion, or to lay down any general principles applicable to all cases.[74] More than a century later, there is still no clear standard for the application of fair use, even though the codification aimed to dispel the discrepancies in the fair use doctrine and to ensure some degree of certainty and predictability in its application.[75]

Congress in fact did not intend to shape the fair use doctrine as a “bright-line rules.” Since the fair use doctrine derives from the concept of “equity,” it is impossible to render a “generally applicable definition,” given that “each case raising the question must be decided on its own facts.”[76] In addition, the fair use doctrine is regarded as an embodiment of “law and fact.”[77] As a general principal for evaluating the lawfulness of the use of works, the fair use doctrine should be capable of dealing with the endless variety of situations and combinations of circumstances that can arise in particular cases, which precludes exact rules in the statute.[78] These two factors prevented Congress from stipulating a clear definition of the fair use doctrine.

Informed by the legislative purpose behind codifying the fair use doctrine, the structure of Section 107 is shaped in a flexible and open-ended manner.[79] On the one hand, the list of the specific examples of fair use, i.e. criticism, comment, news reporting, teaching, scholarship, or research, is non-exhaustive.[80] This is because Congress intended to preserve the broad and fact-specific nature of the fair use doctrine, while also directing the courts to consider the four factors listed in the other part of Section 107.[81] On the other hand, Section 107 allows courts to instill into their fair use analyses any relevant factors other than the four factors listed in Section 107.[82] Therefore, each case raising the question must be decided on its own facts under the fair use doctrine. The codified version of fair use leaves the courts’ ultimate discretion by imposing only flexible guidelines for courts to consider.[83] This causes anxiety for Japan if the U.S. fair use would be adopted in the Japanese Copyright Act as it would become too much of a burden for the courts.

B. Ambiguous Application of the Four Factors

The inconsistencies in the courts’ constructions of the four factors in Section 107 further heighten the ambiguity of the fair use doctrine.[84] For example, comparing two Supreme Court opinions that applied the fair use doctrine illustrates how the “amount used” factor can vary.[85] In Sony Corporation of America v. Universal City Studios, Inc., the Court concluded that videotaping an entire copyrighted television program for private viewing at a later time was a fair use of that work.[86] Despite assuming that the amount copied was the entire expression included in the protected work, the Court reasoned that because such use did not result in any significant negative impact on “the potential market for or value of the copyrighted work,” it was a fair use.[87] On the other hand, in Harper & Row v. Nation Enterprises, the Court found that the defendant’s use of only 300 verbatim words out of a manuscript containing approximately 200,000 words was not a fair use.[88] In spite of the relatively small amount of the protected work that the defendant had used and the public interest in the material, the Court held that because the plaintiff had not yet published its material and it had suffered economic injury as a result of the defendant’s use, there was not a fair use.[89]

In addition, with respect to the factor addressing the nature of the use and whether it was for a commercial purpose, Harper & Row focused on whether a user gains profit from the exploitation of the copyrighted material without paying the customary price.[90] Therefore, a user’s indirect profit-making motivation may be sufficient to prove the commercial nature of the use.[91] On the other hand, Sony viewed direct profit-making motivation as the only key factor for drawing the line between the commercial or noncommercial use of the works, which seems to contradict the Harper & Row approach.[92]

Further, according to Campbell v. Acuff-Rose Music, Inc., “transformative use” consists of the acts of “adding something new, with a further purpose or different character, and alteration of the first [work] with new expression, meaning, or message.”[93] However, Campbell did not articulate a standard for measuring the degree to which the use of a work is “transformative” enough to be regarded as a fair use.[94] It makes it hard for courts to judge whether transformative use should be strictly limited to the direct alteration of the original work or broadly include the use of a work that simply adds new purposes and characters to the original work.[95]

For example, Perfect 10 v. Amazon.com, Inc.,[96] a Ninth Circuit case involving search engines seems to contradict Campbell’s definition of transformative use. According to Campbell, “transformative” use must add “something new.” The search engine in Perfect 10 was the Google Image Search, a visual search engine that copied images into thumbnails. Perfect 10 operated an adult website providing nude photographs.[97] Perfect 10 alleged that Google’s storage of the thumbnails of Perfect 10’s copyrighted images constituted direct copyright infringement.[98] To find “adding something new” in the search engines seems hard because search engines are functional, not creative, devices. However, the court concluded that Google’s use of the thumbnails was “highly transformative” because the search engine used the images in a non-artistic way, and this purpose was itself transformative.[99] In addition, the court mentioned “although an image may have been created originally to serve an entertainment, aesthetic, or informative function, a search engine transforms the image into a pointer directing a user to a source of information.”[100] Thus, what is the “transformative use” seems heavily changeable in each case.

In sum, in one case an extensive use was considered fair, whereas in the other the use of only a small amount was considered unfair. Likewise with respect to the concept of “commercial or noncommercial use,” there is no clear guidance for drawing a line. In addition, “transformative” is so vague that the outcome may heavily depend on each court. These problems show that the fair use doctrine is ambiguous and complex that would be a concern for Japanese copyright legislation.

IV. The U.S. Compliance with International Standards

The United States’ copyright laws compliance with international standards is also a concern to Japan because Japan is a member of the Berne Convention and the WTO. The condition that requires exceptions and limitations be “clearly defined and narrow in scope and reach” recalls the doubt whether the first step of the three-step test is in conflict with the flexible and open-ended limitations. This next part will examine whether the fair use doctrine is consistent with the three-step test.

A. Fair use and the Three-step Test of the Berne Conventon

Judging from the legislative purpose and the structure of Section 107, as well as the discrepancies in various courts’ approaches to applying the four factors, the fair use doctrine is vague, flexible and open-ended.[101] Therefore, the argument that the fair use doctrine may conflict with the first step of the three-step test emerges.[102] Both the U.S. fair use doctrine and the three-step test are “open norms” in the sense that they are not clearly confined to use in a narrowly defined context.[103] However, “special case” under the three-step test was designed to accommodate the “closed norm” approach, which permits only clearly articulated, narrow exemptions for specific uses, and is prevalent among civil law countries’ legal systems, including Japan.[104]

The first three fair use factors seem appropriate for a “conflict with normal exploitation” inquiry under the three-step test. In addition, the effect on the original market overlaps with other two inquiries-special case and lack of unreasonable prejudice.[105] However, a broad-ranging fair use doctrine is problematic since it is not clearly confined by statutory categories.[106] Fair use may qualify as a “special case” in common law legal systems, which after all make law through case-by-case rulings as much as by legislative enactment.[107] However, overall it is hard to argue that fair use is limited to “special case” under the first step of the three-step test.[108]

All in all, incompatibility of fair use with the three-step test is likely to be true by taking into account the drafter’s intention of the Berne Convention and the nature and operation of Section 107. The U.S. fair use doctrine may be too broad to pass over the “special case” step of the three-step test.

B. Fair use and the WTO Panel

Furthermore, WTO Panel Report may provide practical guidance demonstrating what kind of provisions in domestic laws might violate the three-step test. As a result of the Panel decision that the U.S. Copyright Act of Section 110 violates the three-step test, the U.S. and the EC agreed pursuant to Article 25 of the DSU to enter into arbitration to determine the level of nullification or impairment of benefits caused by Section 110(5)(B) of the U.S. Copyright Act.[109] In the end, the parties reached a “mutually satisfactory temporary agreement” on June 2003.[110]

The arrangement mainly states as follows: (1) The U.S. shall make a lump-sum payment in the amount of 3.3 million dollars (the “Payment”) to the EC; (2) The Payment serves as a mutually satisfactory temporary arrangement for the three-year period.[111] At least 45 days prior to the end of this period, if the dispute has not been resolved by that time, the parties will enter into consultations.[112] Since this arrangement has expired, the United States has filed each month virtually identical “Status Reports” regarding the progress of implementing any change in Section 110(5) to be in compliance with Article 13 of the TRIPs Agreement.[113]

It is ironic that while U.S. businesses may enjoy the benefits of providing music to their customers without compensating copyright holders, and having been held to be in violation of international law, the United States has criticized other countries for “piracy.” For example, the United States filed two cases with respect to intellectual property rights protection against China in the WTO on April 10, 2007.[114] However, being told by the WTO that its laws and behavior were in violation of international trade agreements, the United States’ claim against China may not give an impact.[115]

In summary, the elements of the three-step test are: (1) special case; (2) lack of conflict with normal exploitation; and (3) lack of unreasonable prejudice. The WTO Panel has mentioned that “special cases” are not merely “special purposes,” such as the public policy which underpins the fair use doctrine.[116] Rather, the key is the narrow confines of the exceptions and limitations.[117] After the WTO panel, the U.S. copyright law has been considered to be in violation of international law. As a consequence of the WTO Panel, the United States had to pay compensation to the EC, as well as to accept the administrative costs to file “Status Reports” each month. Japan should keep in mind these situations showing the risks and burdens of violating international law if Japan adopts the U.S. fair use doctrine.

V. Concerns for adopting the U.S. Fair Use Doctrine in Japan

A. Structure of Copyright Legislation in Japan

To consider the applicability of fair use to the Japanese Copyright Act, the basic structure of the Japanese copyright system first must be analyzed. The Japanese Copyright Act currently in force was enacted in 1970[118] with the Copyright Act Enforcement Order and the Copyright Act Enforcement Regulation.[119] After the enactment of the Copyright Act, Japan ratified the Berne Convention in 1974,[120] and became a member of the WTO in 1995.[121] The exclusive rights of authors are subject to a number of exceptions and limitations which aim at balancing the authors’ interest in securing economic gain through the exercise of a copyright in their works, and the interests of the general public to enjoy the benefit of the authors’ cultural contributions.[122] The policy underlying this balancing of interests is stated in Section 1 of the Copyright Act that “to secure protection of rights of authors, etc., giving regard to fair exploitation of cultural products and thereby to contribute to the development of culture.”

Explaining that copyright is cultural property, Japan has one of the most complete systems for the promotion of culture in the world.[123] General legislation for cultural property, the Fundamental law for the Promotion of Culture and Arts, was enacted on November 2001 for the purpose of providing a comprehensive mechanism for promoting culture and the arts in Japan.[124] It includes the enhancement of cultural facilities and the protection and use of copyrights.[125] Thus, the aspect of cultural promotion of copyright is ensured not only in the Copyright Act itself, but in General legislation for the promotion of culture.

On the other hand, under the U.S. Copyright Act, the works protected by copyright are not generally considered to be cultural property.[126] The U.S. Constitution enables Congress “[t]o promote the progress of science and the useful arts, by securing to authors and inventors the exclusive right to their respective writings and discoveries.”[127] This provision shows that the United States promotes the creation of innovative intellectual products and secures the economic value of such efforts to authors through the Copyright Act.[128] Nonetheless, it has been attempted to distinguish the works which are protected by copyright as cultural treasures and products from advances in science protected by the patent law. This position has not been generally accepted in the U.S. The economic aspect of copyright underlies the U.S. fair use doctrine as well. [129]

B. The Provisions of Exceptions and Limitations in the Japanese Copyright Act

Japan, as well as most civil law countries, addresses the situation of the provisions of exceptions and limitations to copyright differently from the United States. Even under the U.S. copyright law, fair use is not the only way that allows people access to copyrighted works.[130] As its basic structure, the U.S. Copyright Act also contains specific exemptions and limitations provided in Sections 108 through 122. The fair use doctrine operates as a general provision designed to reach cases of worthy and unauthorized uses that do not fall comfortably within any of the exemptions.

In Japan, however, the provisions of exceptions and limitations in the Japanese Copyright Act are set out in a series of provisions that exempt from copyright liability specified uses of works of authorship for certain limited purposes. The Japanese Copyright Act specifically enumerates various limitations and exceptions to achieve the goal “to secure protection of rights of authors giving regard to fair exploitation of cultural products and to contribute to the development of culture” stated in Section 1, instead of establishing a general “fair use” provision. A general “fair use” provision is neither provided by law nor accepted by the courts in Japan.[131]

For example, In K.K. Gakushu Kenkyusha v. Daisan Shokan, publishers of several magazines sued defendant who published a book containing the publishers’ messages with a discounted price. Defendant contended that its uses of the materials taken from plaintiffs’ magazines did not constitute copyright infringement under the fair use doctrine provided in the U.S. Copyright Act, which he argued should also be applied in Japan.[132] The court held that defendant was liable since his use of plaintiff’s materials did not fit in any of the exceptions and limitations provided in the Japanese Copyright Act.[133] This case indicates that the application of the U.S. fair use doctrine is not generally recognized in Japan. Rather, as in this case, the court will rely on whether the defendant’s activity fell into the enumerated exceptions and limitations provisions in the Japanese Copyright Act.

Specific provisions of exceptions and limitations in the Japanese Copyright Act include reproduction for private use, reproduction in libraries, quotation privileges, use for educational purposes, performances for non-profit purposes, use for news reports, use in political speeches, reproduction in judicial proceedings, exhibition of artistic works by the owner, and use of artistic works located in public spaces.[134]

The broadest exemption is a reproduction for private use under Section 30. It stipulates that it shall be permissible to reproduce the work for personal use or family use or other equivalent uses within a limited scope. Its purpose is to strike a balance between the private rights of authors and the social needs of copyrighted works. For example, internal use by enterprises does not count as private use, and the reproduction must be made by the user himself.[135] In addition, Section 30(2) states that the digital reproduction for private use is not completely copyright-free, but subject to compensation payments in the form of a levy added to the retail price of digital recording machines and blank data carriers. On the other hand, U.S. fair use does not explicitly permit broad private reproduction, even though there is de facto recognition of the limitation.[136] That is, the Japanese private use provision works more broadly than the U.S. fair use doctrine, at the same time it defines the scope of reproduction clearly and narrowly enough for enforcement.

C. Key Players in Copyright Policy

In Japan most of the amendment bills of the copyright law have been drafted by the Japan Copyright Office, an administrative authority under the Agency for Cultural Affairs, which belongs to the Ministry of Education, Culture, Sports, Science and Technology (MEXT).[137] MEXT requests the Subdivision of Copyright under the Council for Cultural Affairs, which is the advisory panel to the Commissioner for Cultural Affairs, to discuss basic copyright policies that would facilitate the basis of legislation. Therefore, it is important to pay attention to the discussions in the Subdivision of Copyright to foresee forth coming amendments to the Copyright Act.

The Subdivision of Copyright is not the only forum to debate copyright issues, however. After then Prime Minister Koizumi stated the initiative with respect to intellectual property policy across the ministries, it has become important to keep an eye on the Intellectual Property Strategy Headquarters as well. Specifically, as a result of the report from the Panel of digital network in November 2008, the adoption of a fair use-like provision will be discussed as one of the most important issues before the Subdivision of Copyright in 2009.

D. Issues for Discussion

1. Incompatibility with International Law

Ultimately, adopting the fair use doctrine in Japan would not be a good idea because it is incompatible with international law. As a member of the Berne Convention and the WTO, Japan is obligated to adhere to the three-step test and the U.S. fair use doctrine may be in violation of that test. Therefore, if Japan adopts a provision that is virtually identical to the U.S. fair use provision, there is a possibility that Japan may be considered by international society as a country that ignores international law. Accordingly, Japan’s notorious reputation in international society may prevail, and it would lose trust from foreign countries.

The Japanese government has held bilateral meetings with China and Korea, where copyright infringement is widespread, to offer these countries support to make an effort to eliminate copyright infringement.[138] In addition, Japan as well as the United States has expressed concerns with respect to copyright protection in China at the WTO. For example, the TRIPs Council Report of 2005 states Japan’s concerns that “IPR enforcement in China was insufficient to deter further infringements, and IPR infringement in China continually caused serious damage to the industry of Japan and that of other countries, including that of China itself.”[139] Japan emphasized the ineffectiveness of administrative sanctions and the importance of enhancing the criminal prosecution of IPR infringements, especially for repeat offenders.[140]

Moreover, when the United States filed an intellectual property WTO complaint against China in April 2007, Japan together with the EU, Canada and Mexico asked the WTO to participate as third parties in the U.S.-China consultations under the formal WTO dispute settlement procedures.[141] The complaint questioned China’s compliance with its TRIPs obligations related to copyright infringement. Specifically, it challenged China’s thresholds for criminal procedures and penalties, the disposal of infringing goods confiscated by Chinese customs authorities, the denial of copyright protection and enforcement to works that have not been authorized for publication or distribution within China, and the unavailability of criminal procedures and penalties for persons who engage in either unauthorized reproduction or unauthorized distribution of copyrighted works.[142]

In summary, Japan has approached other countries with respect to copyright protection not only through bilateral meetings, but also by utilizing the mechanism of the WTO. However, if Japan itself would violate international law, these efforts and Japan’s presence in the international community might be spoiled. Further, if Japan’s violation of international law would be granted at the WTO, Japan would have to pay compensation and file “Status Reports” frequently, the same as the United States has done for the EC as a result of the WTO Panel decision. It would be not only a financial burden but an administrative burden as well for Japan. Therefore, Japan should carefully contemplate whether adopting the fair use doctrine is the best strategy from the perspective of compliance with international law.

2. The Legal System and Culture in Japan

The differences between the legal systems and cultures of the United States and Japan need to be taken into account in a discussion whether adopting U.S. fair use in Japan makes sense since such differences may affect whether the U.S. fair use fits into Japanese society. Japan is a country of civil law tradition having basic codes and statutes in major areas of law. The adoption of basic codes took place in the last decade of the 19th Century following Continental European models.[143] The overreaching goal of the civil law system is legal certainty and the need to produce a comprehensive text.[144] Once the laws are formalized, the role of the courts is to identify the appropriate section of the code. The U.S. fair use doctrine may work in the common law system, however, basic principles of the civil law system seem not to suit the fair use doctrine because it necessarily has flexibility depending heavily on the facts of early case.

In addition, the basic U.S. perspective on intellectual property is utilitarian and economic.[145] Copyright is granted to encourage authors and inventors by rewarding them for their acts of creation.[146] According to this rationale, copyright serves to maximize social wealth.[147] The economic foundations of the U.S. copyright law, which is subject to fair use, can be one of the reasons why the protection for authors in the United States is less extensive than that of Japan, whose copyright law is based the cultural foundations.

Since the fair use doctrine is considered as an embodiment of “law and fact,” it should be capable of dealing with the variety of situations that arise in particular cases. In addition, the fair use doctrine derives from the concept of “equity,” which is one of the factors that makes fair use ambiguous. A common law judge has inherent authority to consider individual fairness derived from the equity tradition.[148] However, in the civil law system as a matter of legal theory, it has been considered that judges have no inherent equitable power.[149] They may be granted authority to use equity in the disposition of a case, but they still must be carefully restricted in the exercise of equity.[150] Moreover, the U.S. fair use doctrine is the “restatement” of case law developed over a hundred years. Without enough accumulated cases and experience to solve lawsuits on a case-by-case basis under the civil law system, it would be hard for courts to utilize and apply the fair use doctrine appropriately in Japan.

Further, the U.S. version of separation of powers structurally divides the two political functions into the legislative and executive governmental branches.[151] In the parliamentary system, the executive, or “government,” is the leadership of the lawmaking.[152] Then, the key separation in the parliamentary system is between the democratic institutions of government and the judiciary.[153] The parliamentary system reinforces the civil law conception of the role of the courts that the courts have a specially-defined function regarding litigation, often to guarantee that courts do not interfere in the business of government.[154] On the other hand, the presidential model empowers the judiciary.[155] Separation of the executive from the legislative branch in the presidential system forces courts be arbiters between the two political branches.[156] Thus, the presidential model enhances judicial autonomy because the judiciary is the ultimate institution to mediate between the executive and the legislative branches.[157]

Moreover, Japanese people tend to avoid litigation as a method of dispute resolution. If problems of ambiguousness result from Japan adopting the fair use doctrine, people may bring these problems to the court to be solved. Fair use may be necessary, especially for venture businesses because they are likely to take a risk on litigation if their business models depend upon fair use.[158] However, it has been said that Japanese people, whether ordinary citizens or sophisticated businesspeople, actively attempt to avoid confrontation, and it is one of the reasons for Japan’s low litigation rate.[159] To pursue litigation disturbs harmony, and therefore is considered to be shameful.[160] There is a strong public expectation “that a dispute should and will not arise; even when one occurs, it is to be solved by mutual understanding” in Japanese culture.[161]

All in all, to introduce and apply the fair use doctrine may be too burdensome for courts in Japan since they do not have enough case law to refer to and experience to judge on a case-by-case basis. As a result, it may take longer to reach conclusions[162] as well as it may cause wrong decisions by applying fair use in an unreasonable way. Therefore, it is ineffective to adopt the U.S. fair use doctrine from the view point of ensuring speedier and proper trial. In addition, Japanese people tend to avoid litigation since the Japanese culture prefers “harmonization.” Therefore, even if U.S. fair use is introduced into Japanese society, the litigation rate with respect to copyright infringement may not be drastically increased. Thus, U.S. fair use may not be suitable to be imported in the Japanese Copyright Act because it relies on the common law tradition and Japan and the United States have different legal cultures.

3. Advantages of Enumerated Exceptions

In addition, the biggest advantage of enumerated copyright exceptions and limitations in the Japanese Copyright Act is legal stability and predictability. They make exceptions and limitations easier to understand and predict what would constitute copyright infringement. Moreover, legal stability and predictability may enhance the content-creation businesses such as animated game software and motion pictures because they may contribute to collecting invested capital because the economic value of copyright has been increasing.[163] As can be seen under U.S. case law with respect to the fair use doctrine, it is very unclear what kind of behavior and situations would be regarded as fair use. Besides, the courts’ operations of the fair use doctrine and decisions are not consistent because of its flexibility and complexity.

Enumerated copyright exceptions and limitations offer more predictable application than the U.S. fair use doctrine.[164] There also seems to be differences between the basic purposes of the U.S. Copyright Act, which is based on economic interests supporting the fair use doctrine, and the Japanese Copyright Act, whose products generally are considered as cultural property. An unpredictable provision like U.S. fair use may not be suitable with enumerated provisions of exceptions and limitations in the Japanese Copyright Act. Therefore, to maintain the current enumerated provisions of exceptions and limitations under the Japanese Copyright Act seems more appropriate than to adopt the U.S. fair use doctrine.

4. Fair Use as a Response to New Technology

Some people insist that a fair use-like provision should be introduced in the Japanese Copyright Act otherwise Japanese law will become out of date. However, I do not consider a fair use-like provision to be the best option to respond to the digital era.

Generally speaking, the process of amending the law, at least in Japan, is time-consuming and necessarily lags behind social and technological developments, which may cause the law to be out of date. The advent of digital media and the high quality of “piracy” means that high technology enables everyone to access information.[165] These circumstances create new internet-related businesses, and can provide a new forum for creation and publication.[166] Accordingly, it is essential for Japan to enhance incentives for creators and the further development of internet businesses so that Japan can remain internationally competitive.[167] Japan has implemented the Intellectual Property Strategic Program to improve the legal system, but it is not enough to maximize the digital environment.[168]

In November 2008, the Panel on digital network concluded in its Report of IP Systems in the Digital Network Era that a fair use-like provision should be introduced in Japanese copyright law.[169] It stated that the current Copyright Act stipulates provisions for exceptions and limitations in line with specific cases. De-minimis activities such as printing out webpages which are excluded from the scope of these provisions, even though they do not unreasonably prejudice the right holder’s interest, are technically considered as illegal. However, operationally there are some cases that the courts consider such activity as “fair” even if it does not directly fall into the provisions of exceptions and limitations by a flexible interpretation of the law.[170] This report significantly affected the discussions considering the fair use introduction to the Japanese Copyright Act. The Subdivision of Copyright operated by the Copyright Office will have further debates based on this report.

One of the merits of adopting the fair use doctrine is its flexibility. Flexibility permits a response to rapid technological development, which was not expected at the time of legislation, so that fair use may become a supplement for the delay of legislation.[171] The Report of IP Systems in the Digital Network Era addresses that the current Copyright Act may discourage the business sector from starting new technological developments and activities.[172] For example, from the inception of the search engine on the Internet, it has been pointed out that the indexing function might be a copyright infringement because search engines index websites through the use of software that scans and stores content without the permission of the owners.[173] Therefore, the business sector offering the search engine service may be intimidated by the possibility of copyright infringement.[174]

However, the Japanese legislature has kept up with demand by amending the copyright law at very short intervals.[175] The frequent amendments of the law, which on average have been made nearly every year, have kept pace with the technological development of the last decade.[176] In fact, this year the amendment bill has already been passed. The amendment bill includes provisions for exceptions and limitations concerning search engines, the purpose of research and development in the area of intelligence analysis, and temporary storage.[177] Therefore, as long as the current frequency of amendments is maintained, it seems enough to fulfill the role to reflect the technological development and respond to the social demand.

All in all, the necessity of introducing the fair use doctrine as a method of keeping up with the technology cannot be found. The fair use doctrine might work to some extent with respect to updating the new technologies because of its flexibility. However, the span of amendment is short enough to reflect the social demand caused by new technologies. In addition, provisions of exception and limitation in connection with the technological development such as the use for search engine and temporary storage are added after the amendment bill is passed by the Diet this year.

5. Japan’s Copyright Law already allows for Fairness

Finally, every law in Japan has the concept of “fairness.”[178] Even though the Japanese Copyright Act has enumerated exception and limitation provisions, judges may sometimes read the law in an analogous or extended interpretation based on the specific case under the current Copyright Act if it is needed to realize “fairness.”[179] However, this is not the result of the application of fair use since the Japanese Copyright Act does not have fair use. Rather it is the last resort to realize “fairness” where there is no specific enumerated exception and limitation provision.

For example, the Tokyo High Court dealt with a case where an advertising catalog for lighting equipment in the Japanese-style room was photographed by plaintiff, which happened to include the calligraphy on the wall of the room.[180] When plaintiff made a reproduction of the advertising catalog, it technically constituted an unauthorized reproduction of the calligraphy.[181] The court stated that the reproduction of calligraphy in the photo can be considered as the reproduction of an “artistic work” as defined in Section 10(4) of the Japanese Copyright Act only if people can directly recognize the aesthetic factors of calligraphy, rather than just the word and typeface from the reproduction of the photo.[182] Then the court held that because the calligraphy that appeared in the advertising catalog was minimized, it was hard for general people to recognize the aesthetic nature.[183] Therefore, the plaintiff’s actions did not constitute copyright infringement.[184]

In another leading case, the issue was the interpretation of Section 46 of the Japanese Copyright Act.[185] It provides that artistic works such as architectural works and sculptures located permanently at publicly accessible places may be freely exploited. Plaintiff drew a picture on the body of a city bus.[186] Defendant published picture books, which explained several kinds of vehicles together with pictures of them.[187] The books included the picture of the city bus with the drawing by plaintiff.[188] The issue was whether a city bus is considered to be “located permanently at publicly accessible places.”[189] Buses move around during the day, and are located in the garage at night. It seems not to be “located permanently at publicly accessible places” by a strict interpretation of the provision.[190]

However, the Tokyo District Court held that it does not constitute copyright infringement.[191] The court stated that “located permanently at publicly accessible places” should be interpreted to mean “put into the situation that can be seen by the general public over the long term.”[192] The bus was routinely running the same as other city buses.[193] Therefore, the plaintiff’s activity, drawing a picture on a bus routinely running on public roads, should be considered as “located permanently at publicly accessible places.”[194] The court also stated that the defendant’s reproduction should be evaluated based on whether it was done for the purpose of “exclusively” selling a reproduction of artistic work, relying on such factors as the book’s appearance, contents and purpose.[195] The books were made for children to explain vehicles in town with pictures so that children’s power of observation and curiosity would be enhanced.[196] In addition, the appearance and contents were appropriate according to such purposes.[197] Therefore, the court concluded that the defendant’s action did not constitute copyright infringement.[198]

In sum, case laws show that the current Copyright Act functions to realize the concept of “fairness” which every law in Japan inherently has. Therefore, there is no special need to adopt the U.S. fair use doctrine at this moment in exchange for the high risk of violation of international law.

VI. Conclusion

With respect to the scope of a fair use-like provision, the Report of IP Systems in Digital Network Era does not seek adoption of a fair use provision as broad and general as U.S. fair use. Rather, it targets the activities, which technically may constitute copyright infringement under the current Japanese Copyright Act, but fall within a certain set of cases that would not unreasonably prejudice the right holder’s interest.[199] The conclusion of the Report seems not so unreasonable because it resides within the scope of the three-step test. However, the debates at the panel with respect to a fair use-like provision have only been done twice, which is not enough to decide whether to adopt a general provision in the Japanese Copyright Act. Therefore, even though there is no strong opposition against the government direction to introduce a fair use-like provision, further in-depth discussion considering what kind of fair use-like provision needs to be adopted in the Japanese Copyright Act should occur. Following are some suggestions and precautions for adopting a fair use-like provision in Japan.

The United States and Japan has different modes for exceptions and limitations on copyright. The U.S. fair use doctrine is a broad and flexible approach: as long as the general conditions are met, any unauthorized act of using works would be exempted from potential liability. On the other hand, Japan has a list of specific exceptions and limitations that prescribe detailed conditions under which each limitation could be invoked.

In addition, the compatibility with international law should be emphasized in the process of further discussions. As a signatory to the TRIPs Agreement, the Berne Convention, and other international agreements, the Japanese Copyright Act must be in compliance with Japan’s obligations under these agreements. Since the first step of the three-step test requires that any limitation on copyright should be “clearly defined and narrow in scope and reach,” it may violate the three-step test if Japan adopts the same style as the U.S. fair use doctrine. Therefore, such requirements contained in the first step of the three-step test should be kept in the legislative structure of the Japanese Copyright Act. If a fair use-like provision with a high possibility of violation of international law is stipulated in the Copyright Act, it would spoil the reputation of Japan among international society. As a result, Japan might lose a greater voice in the world, and it might damage national interests in the long run.[200]

In addition, a fair use-like provision is needed to be provided as clear and narrow as possible in scope from the view point of legal stability and predictability if it is adopted in the Japanese Copyright Act. The current enumerated provisions on exceptions and limitations are the appropriate style to keep legal stability and predictability rather than introducing the U.S. fair use doctrine into the Japanese Copyright Act. Inevitably, there exists a flexibility and certainty tradeoff in formulating any legal doctrine.[201] However, language in the law has an important role to convey its regulatory signals to the public.[202] Therefore, statutes should make clear stipulations so that they help people to comply with the law.[203]

Further, by maintaining a reasonable pace of amendment, lags behind social and technological developments should be minimized. The current Japanese Copyright Act has been amended on numerous occasions to respond to the challenges provided by developing technologies. In fact, the current amendment bill submitted to the Diet this year includes the exceptions and limitations to keep pace with digital developments.

Moreover, the differences of the legal system between the U.S. and Japan, i.e. the common law system and civil law system, as well as the Japanese attitude toward litigation, are in favor of not adopting the U.S. fair use doctrine in Japan. People in the United States have been described as living in a highly legalized culture,[204] which considers litigation as the best option to solve a dispute. Japanese society, meanwhile, is controlled by a system of mutual and consensual relationships supported by cultural values of “harmony.” Therefore, the expectation that the litigation rate would increase as a result of introduction of the fair use doctrine and that courts would resolve disputes might be unrealistic. Thus, to stick with the introduction of U.S. fair use is not worth the risk of violating international laws. Therefore, discussion whether the Japanese Copyright Act needs the fair use doctrine should not rush into conclusions. Rather it should carefully look at the negative and unreasonable aspects of adopting the fair use doctrine.

A copyright system with lack of balance, disproportionately favoring copyright holders, could chill creative productivity not only in Japan but in the international marketplace.[205] The government and stakeholders need to ponder a well balanced, workable fair use-like provision if it would be codified in the Japanese Copyright Act.

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End Notes

  • [1] Home Page of the Prime Minister of Japan and His Cabinet, Council and Headquarters, Strategic Council on Intellectual Property, http://www.kantei.go.jp/foreign/policy/titeki/index_e.html
  • [2] Act No. 122 of 2002.
  • [3] Home Page of the Intellectual Property Strategy Headquarters, http://www.ipr.go.jp/
  • [4] Dejitaru Nettowaku Jidai ni okeru Chizai Seido no Arikata ni tsuite [Report of Intellectual Property Systems in the Digital Network Era], November 21, 2008, http://www.kantei.go.jp/jp/singi/titeki2/houkoku/081127digital.pdf. [herein after Report of IP Systems in the Digital Network Era].
  • [5] Michael Landau, Fitting United States Copyright Law into the International Scheme: Foreign and Domestic Challenges to Recent Legislation, 23 Ga. St. U. L. Rev. 847, 851 (2007).
  • [6] Dellar v. Samuel Goldwyn, Inc., 104 F.2d 661, 662 (2d Cir. 1939).
  • [7] Berne Convention for the Protection of Literary and Artistic Works, Sept. 9, 1886, as last revised at Paris on July 24, 1971, 1161 U.N.T.S. 30 [hereinafter Berne Convention].
  • [8] Agreement on Trade-Related Aspects of Intellectual Property Rights, Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1C, 1869 U.N.T.S. 299 [hereinafter the TRIPs].
  • [9] WIPO Copyright Treaty, Dec. 20, 1996, S. Treaty Doc. No. 105-17 (1997).
  • [10] WIPO Performances and Phonograms Treaty, Dec. 20, 1996, S. Treaty Doc. No. 105-17 (1997) [hereinafter WPPT].
  • [11] Melville B. Nimmer, Implications of the Prospective Revisions of the Berne Convention and the United States Copyright Law, 19 Stan. L. Rev. 499 (1967).
  • [12] Contracting parties are available at WIPO Home Page,http://www.wipo.int/treaties/en/ShowResults.jsp?lang=en&treaty_id=15 (last visited May. 7, 2009).
  • [13] Article 9(2) of the Berne Convention: It shall be a matter for legislation in the countries of the Union to permit the reproduction of such works in certain special cases, provided that such reproduction does not conflict with a normal exploitation of the work and does not unreasonably prejudice the legitimate interests of the author.
  • [14] Haochen Sun, Overcoming the Achilles Heel of Copyright Law, 5 Nw. J. Tech. & Intell. Prop. 265, 24, 12 (2002).
  • [15] Id.
  • [16] MihĂ€ly Ficsor, Guide to the Copyright and Related Rights Treaties Administered by WIPO and Glossary of Copyright and Related Rights Terms 45 BC-9.11, (World Intellectual Property Organization (WIPO) 2003).
  • [17] Id.
  • [18] Records of the Intellectual Property Conference of Stockholm 1967, para.85,1145-46 (World Intellectual Property Organization, 1971) [hereinafter Records of the 1967 Stockholm Conference ]
  • [19]  Ficsor, supra note 16, at BC-9.13.
  • [20] Id. at BC-9.15.
  • [21] Id.
  • [22] Id. at BC-9.16-17.
  • [23] Id. at BC-9.17.
  • [24]  Ficsor, supra note 16, at BC-9.18.
  • [25] Id.
  • [26] Id.
  • [27] Id. at BC-9.19.
  • [28]  Records of the 1967 Stockholm Conference, supra note 18, at 112.
  • [29]  Ficsor, supra note 16, at BC-9.21.
  • [30] Id. at BC-9.23.
  • [31] Id. at BC-9.29.
  • [32] Id.
  • [33] Jo Oliver, Copyright in the WTO: The Panel decision on the Three-step Test, 25 Colum. J. L. & Arts 119, 121 (2002).
  • [34] TPIPs, supra note 8, Art.64.
  • [35] Oliver, supra note 32, at 121.
  • [36] WTO Home Page, Overview: TRIPS agreement, http://www.wto.org/english/tratop_e/trips_e/intel2_e.htm
  • [37] Richard J. Peltz, Global Warming Trend? The Creeping Indulgence of Fair Use in International Copyright Law, 17 Tex.Intell. Prop. L.J. 267, 272 (2002).
  • [38] Sun, supra note 14, at 27.
  • [39] Sun, supra note 14, at 26-27.
  • [40] 17 U.S.C. §110(5)
  • [41] Sun, supra note 11, at 39.
  • [42] H.R. Rep. No.94-1476, 94th Cong., 2nd Sess.86 (1976), as reprinted in 1976 U.S.C.C.A.N. 5659, 5700.
  • [43] Id.
  • [44] 17 U.S.C. §110(5)(B).
  • [45] Oliver, supra note 32, at 121-22.
  • [46] Landau, supra note 5, at 883.
  • [47] Id.
  • [48] World Trade Organization, Panel Report, United States-Section 110(5) of the U.S. Copyright Act, 2.16, WT/DS160/R (June 15, 2000), [hereinafter WTO Panel Report].
  • [49] .Id. para. 6.104-105.
  • [50] Id. para. 6.106.
  • [51] Id.
  • [52] Id.
  • [53] Id. para. 6.112.
  • [54] Id. para. 6.108.
  • [55] Id. para. 6.109, 112.
  • [56] Id. para. 6.109.
  • [57] Id. para. 6.112.
  • [58] Id.
  • [59] Id. para. 6.103-04.
  • [60] Sun, supra note 14, at 43.(For instance, Jane Ginsburg argues that the first step of the three-step test only accommodates limitations that “are sufficiently narrow” and there is no need to pursue “normative inquiry” into the underlying public policy.)
  • [61] Id.
  • [62] WTO Panel Report, supra note 47, para. 6.165.
  • [63] Id. para. 6.177.
  • [64] Id. para. 6.183.
  • [65] Id. para. 6.224.
  • [66] Id. para. 6.229.
  • [67] Id. para. 6.247.
  • [68] Id. para. n.205.
  • [69] Sun, supra note 14, at 39.
  • [70] 17 U.S.C. §107.
  • [71] H.R. Rep. No.94-1476, supra note 42, at 66.
  • [72] Id. at 65, 1976 U.S.C.C.A.N. at 5679.
  • [73] 9 F. Cas.342 (1481)
  • [74]  Id. at 344.
  • [75] Sun, supra note 14, at 48.
  • [76] H.R. Rep. No.94-1476, supra note 42, at 65.
  • [77] Harper & Row Publishers, Inc. v. Nation Enterprises, 471 U.S. 539, 560 (1985).
  • [78] H.R. Rep. No.94-1476, supra note 42, at 66.
  • [79] Sun, supra note 14, at 51.
  • [80] Harper & Row, 471 U.S. at 561.
  • [81] Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 584 (1994) (“Congress resisted attempts to narrow the ambit of this traditional enquiry by adopting categories of presumptively fair use, and it urged courts to preserve the breadth of their traditionally ample view of the universe of relevant evidence.”).
  • [82] Sun, supra note 14, at 52.
  • [83] Paul Tager Lehr, The Fair-use Doctrine before and after “Pretty Woman’s” Unworkable Framework: The Adjustable Tool for Censoring Distasteful Parody, 46 Fla. L. Rev.443, 454 (1994).
  • [84] Sun, supra note 14, at 53.
  • [85] Amy B. Cohen, Masking Copyright Decisionmaking: The Meaninglessness of Substantial Similarity, 20 U.C. Davis L. Rev. 719, 762 (1987).
  • [86] 464 U.S. 417 (1984).
  • [87] Id. at 450-54.
  • [88] Harper & Row, 471 U.S. 539.
  • [89] Id. at 560-69.
  • [90] Id. 471 U.S. at 562.
  • [91] Sun, supra note 14, at 55.
  • [92] Sony Corp. of America, 464 U.S. 417, 450 n.33 (rejecting the argument that “consumptive uses of copyrights by home VTR users are commercial even if the consumer does not sell the homemade tape because the consumer will not buy tapes separately sold by the copyright holder.”).
  • [93] Campbell, 510 U.S., at 579.
  • [94] Sun, supra note 14, at 57.
  • [95] Id.
  • [96] 508 F.3d 1146 (9th Cir. 2007).
  • [97] Id. at 1157.
  • [98] Id. at 1159.
  • [99] Id. at 1166.
  • [100] Id.
  • [101] Sun, supra note 14, at 67.
  • [102] Id. at 44.
  • [103] Peltz, supra note 36, at 273.
  • [104] Id. at 273.
  • [105] Id. at 274.
  • [106] Id.
  • [107] Martine Senftleben, Copyright, Limitations and The Three-Step Test: An Analysis of the Three-Step Test in International and EC Copyright Law 163 (P. Bernt Hugenholtz ed., Kluwer Law International 2004).
  • [108] Peltz, supra note 36, at 274-75.
  • [109] Landau, supra note 5, at 886.
  • [110] WTO, Notification of a Mutually Satisfactory Temporary Agreement, United States-Section 110(5) of the U.S. Copyright Act, WT/DS160/23 (June 26, 2000).
  • [111] Id. at 2.
  • [112] Id.
  • [113] WTO, Status Report by the U.S., United States-Section 110(5) of the U.S. Copyright Act, WT/DS160/ Add.
  • [114] Measures Affecting the Protection and Enforcement of Intellectual Property Rights DS362, and Measures Affecting Trading Rights and Distribution Services for Certain Publications and Audiovisual Entertainment Products DS363 (Apr. 10, 2007).
  • [115] Landau, supra note 5, at 889.
  • [116] WTO Panel Report, supra note 47, para. 6.112.
  • [117] Id.
  • [118] Act No. 48 of 1970, last amended by Act No.121 of 2006.
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  • [120] Contracting parties are available at WIPO Home Page,supra note 12.
  • [121] WTO Members are avairable at WTO Home Page, http://www.wto.org/english/thewto_e/whatis_e/tif_e/org6_e.htm
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  • [124] Act No. 148 of 2001.
  • [125] Id. Art. 20.
  • [126] Scott, supra note 122, at 358.
  • [127] U.S. Const. art. i, §8, cl.8.
  • [128] Scott, supra note 122, at 358.
  • [129] Id.
  • [130] Marshall Leaffer, The Uncertain Future of Fair Use in a Global Information Market Place, 62 Ohio St. L.J. 849, 863 (2001).
  • [131] Peter Ganea & Christopher Heath, Japanese Copyright Law Writings in Honour of Gerhard Schricker 58 (Peter Ganea et al. ed., Kluwer Law International 2005).
  • [132] 1567 Hanrei Jiho 126 (Tokyo D. Ct., Dec. 18, 1995).
  • [133] Id.
  • [134] Japanese Copyright Act, art.30-50.
  • [135]  Ganea & Heath, supra note 130, at 58.
  • [136] Sun, supra note 14, at 81.
  • [137] The bills submitted by house members are rear in Japan. Approximately 20% of the approved bills are submitted by house members. http://www.clb.go.jp/contents/all.html
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  • [140] Id. para 44-46.
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  • [142] Id.
  • [143]  Doi, supra note 121, at 23.
  • [144] Martin Vranken, Fundamentals of European Civil Law and Impact of the European Community 37 (The Federation Press 1997).
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  • [146] Id.
  • [147] Id
  • [148] John Henry Merryman, The Civil Law Tradition: An introduction to the Legal Systems of Western Europe and Latin America 51-52 (Stanford University Press 1969).
  • [149]  Id. at 52.
  • [150] Id.
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  • [152] Id.
  • [153] Id.
  • [154] Id.
  • [155] Id. at 67.
  • [156] Id.
  • [157] Id.
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  • [162] Nobuhiro Nakayama, Chosakuken ho [Copyright Law] 311 (Yuhikaku 2007).
  • [163] Id. at 309.
  • [164] Peltz, supra note 36, at 274.
  • [165] Report of IP Systems in the Digital Network Era, supra note 4, at introduction.
  • [166] Id.
  • [167] Id.
  • [168] Id.
  • [169] Id.at10-12.
  • [170] Id.at 8.
  • [171] Nakayama, supra note 137, at 308.
  • [172] Report of IP System in Digital Network Era, supra note 4, at 11.
  • [173] Id.at 8.
  • [174] Id.at 11.
  • [175] Nakayama, supra note 161, at 309.
  • [176]  Ganea & Heath, supra note 130, at 14-15.
  • [177] Bunka Shingikai Chosakuken Bunkakai Hokokusho [Report of Subdivision of Copyright the Council for Cultural Affairs], January, 2009, [herein after Report of Subdivision of Copyright] available at http://www.bunka.go.jp/chosakuken/singikai/pdf/shingi_hokokusho_2101.pdf.
  • [178] Nakayama, supra note 161, at 311.
  • [179] Id.
  • [180] 1758 Hanrei Jiho 137 (Tokyo High. Ct., Jan. 18, 2002).
  • [181] Id.
  • [182] Id.
  • [183] Id.
  • [184] Contra Report of IP Systems in Digital Network Era, supra note 4, at 8 (It cited this case as an example to support to introduce fair use because the court’s interpretation of reproduction is too flexible to decide the plaintiff’s use constitutes fair use without the fair use provision.).
  • [185] 1786 Hanrei Jiho 136 (Tokyo D. Ct., July 25, 2001).
  • [186] Id.
  • [187] Id.
  • [188] Id.
  • [189] Id.
  • [190] ICPF Report, supra note at 157.
  • [191] 1786 Hanrei Jiho 136 (Tokyo D. Ct., July 25, 2001).
  • [192] Id.
  • [193] Id.
  • [194] Id.
  • [195] Id.
  • [196] Id.
  • [197] Id.
  • [198] Contra Report of IP System in Digital Network Era, supra note 4, at 8 (It cited this case as an example to support to introduce fair use because the court’s interpretation of provisions of exceptions and limitations is too flexible to decide the plaintiff’s use constitutes fair use without the fair use provision.).
  • [199] Report of IP Systems in Digital Network Era, supra note 4, at 11-12.
  • [200] Naoki Koizumi, Kenri Seigen no Ippan Kitei no Donyuron nit suite [Discussion of Japanese version of the Fair Use Provision], Kopiraito [Copyright], Dec. 2008, at 44.
  • [201] Leaffer, supra note 129 at 852.
  • [202] Sun, supra note 14, at 107.
  • [203] Id.
  • [204] Pont, supra note 159, at 320.
  • [205] Peltz, supra note 36, at 288.

Last updated 4/27/2012