WIPO

CRNR/DC/4 ORIGINAL: English DATE: August 30, 1996

9.01 The Berne Convention does not contain any provisions on the rental of copies of literary and artistic works.

9.02 Rental rights concerning computer programs and cinematographic works were included in the TRIPS Agreement. Members of the TRIPS Agreement shall provide authors (and their successors in title) the right to authorize or prohibit the commercial rental to the public of originals or copies of their copyrighted works. As far as cinematographic works are concerned, the TRIPS Agreement provides for an impairment test: a Member shall be excepted from according the right in respect of cinematographic works unless such rental has led to widespread copying of such works which is materially impairing the exclusive right of reproduction conferred in that Member on authors. Computer programs are excluded, under the TRIPS Agreement, from the scope of the right of rental in a single case: if the program is not the essential object of the rental, the obligation to grant a rental right does not apply.

9.03 The right of rental has been discussed in the Committees of Experts on several occasions. The trend has been towards a broad rental right covering all, or almost all, categories of works as an exclusive right.

9.04 Paragraph (1) of Article 9 provides authors of literary and artistic works with the exclusive right of authorizing the rental of the original and copies of their works. The right of rental differs from the right of distribution as laid down in Article 8. Paragraph (1) explicitly provides that the right of rental survives distribution, i.e. the first sale or other transfer of ownership. In principle, this right could cover all categories of works. However, in order to design a proposal that would be acceptable to as many Contracting Parties as possible, such a far reaching solution has not been proposed.

9.05 Paragraph (2) would maintain the exclusive right of rental for three specific types of works: computer programs, collections of data or other material, within the meaning of Article 5, in machine-readable form, and musical works embodied in phonograms. Contracting Parties could exempt other categories of works from this right, but they would not have this option if such rental led to widespread copying that materially impaired the exclusive right of reproduction. Thus, these categories of works would be accorded the same level of rental right as is accorded to cinematographic works in the TRIPS Agreement. The right of rental would be subject to the impairment test.

9.06 Paragraph (3) would allow Contracting Parties to exclude architectural works and works of applied art from the scope of this right.

9.07 The proposal is formulated in such a way that it would, compared to the TRIPS Agreement, raise the level of the right of rental for databases in machine-readable form and musical works embodied in phonograms by providing an unconditional exclusive right. Computer programs and these types of works would enjoy the same treatment. As regards databases in machine-readable form, this proposal would bring the protection of authors to the same level provided for the makers of databases according to the proposed new Treaty on the Intellectual Property in respect of Databases. The makers of databases would enjoy the exclusive right of rental as a part of the right of utilization. On the other hand, authors would enjoy the right of rental in respect of the musical works embodied in phonograms while, according to the New Instrument, the producers of phonograms would enjoy the right of rental in respect of phonograms.

9.08 Proposals in favour of the right of rental were presented for the February 1996 session of the Committees of Experts by Argentina, Australia, Brazil, Canada, the European Community and its Member States, Japan, the People's Republic of China, the Republic of Korea, the United States of America, and Uruguay. The proposal made by Australia was supported by the group of African countries. A broad right of rental was favoured by Argentina, Brazil, the European Community and its Member States, Uruguay, and the group of countries of Latin America and the Caribbean. The minimum level of protection in other proposals was based on the TRIPS Agreement, in some cases with additional elements, including an exclusive rental right of musical works embodied in phonograms and the extension of the impairment test to all categories of works.

9.09 In the TRIPS Agreement, computer programs have been excluded from the scope of the right of rental where the program is not the essential object of the rental. This aspect was included in some of the proposals made. However, this detail has not been included in the present proposal. The question of the essentiality of the object of rental may also concern other categories of works, such as databases. The proposed Treaty takes the position that this matter may most feasibly be settled at the national level.

(1) Authors of literary and artistic works shall enjoy the exclusive right of authorizing the rental of the original and copies of their works even after distribution of them by or pursuant to authorization by the author.

(2) Except in the case of computer programs, collections of data or other material in machine-readable form, and musical works embodied in phonograms, specific types of works may be excepted from the provisions of paragraph (1) unless the rental of such works has led to widespread copying that materially impairs the exclusive right of reproduction.

(3) Contracting Parties may provide in their national legislation that the provisions of paragraph (1) and paragraph (2) do not apply in respect of architectural works or in respect of works of applied art.