IIPA on Russia’s copyright law implementation and enforcement obligations

The copyright and related rights obligations of the WTO TRIPS Agreement consist of the substantive copyright law and related rights provisions set out in Articles 9 through 14, as well as the enforcement provisions in Articles 41 through 61.

Article 41 of the WTO TRIPS Agreement requires that member-countries “ensure that enforcement procedures…permit effective action against any act of infringement of intellectual property rights…including expeditious remedies to prevent infringements and remedies which constitute a deterrent to further infringements.” TRIPS Agreement, Art. 41. Enforcement in Russia has fallen far short of this obligation, certainly against digital piracy, and remains a significant concern for all of the copyright industries represented by the IIPA – the recording, motion picture, book publishing and entertainment software industries.

The existing remedies and enforcement actions under Russian law, taken as a whole, including the civil, administrative and criminal provisions, do not provide the kind of “expeditious,” “effective,” or “deterrent” remedies required by Article 41 of the WTO TRIPS Agreement.

Online Enforcement

Recent legal reforms have improved civil enforcement in Russia against online piracy. In 2017, for example, legal reforms were enacted consistent with improvements in 2013 and 2014 to establish procedures and streamlined processes for websites to comply with takedown notices from rights holders.

Unfortunately, in recent years, these new procedures and processes have been directed only at online piracy by users within Russia. The result has been a substantial and persistent international copyright piracy problem of illegal sites and services accessed by users outside of Russia. The Russian Government needs to engage in enforcement targeting illegal sites and streaming services that operate in Russia, even if the users are abroad.

In 2016, vKontakte (vk.com), the most popular online social network in Russia, agreed to music licenses with several major record companies. In spite of these licensing agreements, the U.S. Government retained vKontakte on the Notorious Markets List in 2016 and again in 2017. The U.S. Government noted that despite “positive signals,” VK reportedly continues to be a “hub of infringing activity” noting, in particular “thousands of infringing motion picture files on the site.”

vKontakte, now owned by Mail.ru, has a functionality specifically designed to enable its members to upload files, which consist of hundreds of thousands of unlicensed copyright works, including film materials. It is available in many languages, including English, and has a dedicated content search engine that enables searches and instant streaming of content (and, for years, it permitted third party “apps” to enable non-members to search, stream and download the content available on the site).

In short, more enforcement is needed, targeting the myriad of other infringing websites. Proper enforcement actions would include steps to keep infringing sites down and taking criminal enforcement actions against the owners and operators of these sites that are causing significant economic harm to rights holders.

Collective Administration

Fixing the long-standing problems of collective administration for music services in Russia is another unfulfilled obligation of the WTO TRIPS Agreement. The obligations and resolution of the issue of the state accreditation of collecting societies needs to be undertaken in a manner that ensures that rights holders are able to control and manage their own societies, so that they are fairly represented and there are no conflicts of interest in the governance structures. Fair representation in these societies includes direct representation of rights holders on the board in a manner that is proportionate to relevant market share and that reflects commercial realities.

Unfortunately, the new law falls far short of providing transparency to rights holders and good governance consistent with international norms and best practices for collecting societies. The 2017 legislation was adopted by the Duma in November 2017 and came into force in May 2018. It amends the Civil Code and the Administrative Code to revise the make-up and activities of collective rights management organizations (RMOs). One obvious failure of the new law to provide transparency is that it neither allows rights holders to see how much money their RMOs collect, nor how much they distribute to their members.

The new law creates “supervisory boards” for each of the various authors’ collection societies (the Russian Authors Society, the Russian Union of Right Holders and the All-Russian Intellectual Property Organization) consisting of members of each RMO, but also including government representatives and “user” group representatives. This will not allow rights holders to be involved in the selection and management of the organizations that purport to manage their rights.

Proper management would allow for a supervisory board of rights holders to oversee the internal management of the RMO, and would include international rights holders with local representatives on the board. Instead, partial control by the Russian Government will deprive rights holders of their ability to control the licensing and collection of monies for their works and recordings, and likely result in less, not more, money flowing to authors and producers.

Lastly, the so-called fiscal control improvements, including regular audit reports, will not improve accountability, because the audit obligations are only to the government (for taxation purposes), not to those rights holders.

Camcording of Motion Pictures

Russia remains the home to some of the world’s most prolific criminal release groups of motion pictures. Pirates obtain their source materials for infringing copies by camcording films at local theaters, and then upload these copies onto the Internet as well as selling illegal hard copies. The total number of camcord pirate copies sourced from within Russia rose significantly in 2017 to 78 (up from 63 in 2016). In 2018, through August, there were 35 camcords sourced from Russian cinemas. While this is a reduction from 2017 (during the same period of time), Russia remains one of the top five sources for pirated camcords globally.

Most of the Russian camcords come from Moscow, Kazan, Tatarstan, St. Petersburg, Ekaterinburg, Saratov, and some of the Siberian cities. The illicit camcords that are sourced from Russia are only of fair quality, but they remain in high demand by international criminal syndicates.

To fulfil its obligations and to correct this problem, the Government of Russia needs to amend Article 146 of the Criminal Code to more effectively address illicit camcording in theaters (a 2013 amendment was never adopted). The government should also provide adequate resources and undertake more effective enforcement against illegal camcording of motion pictures.

Other Enforcement Issues

The harm caused by commercial-scale piracy in Russia cannot be adequately addressed with civil measures alone; rather, enhanced administrative actions (and penalties) and criminal remedies are needed. IIPA continues to recommend that there should be a dedicated digital IPR enforcement unit within the Government of Russia.

The current Civil Code does not provide clear liability rules for online websites and services that induce or encourage infringement (and the applicability of safe harbors for such services). Even after the recent amendments, the law does not clearly define ISPs and the various services they provide; nor does it link liability and safe harbors in a manner that will encourage cooperation with rights holders to effectively deal with Internet piracy—in civil and criminal law; last, it does not clearly define secondary liability. Further, it is critical that Russia amend its regime to allow for injunctive relief that is quick, effective and applicable to all works, especially for Internet matters.

Several sectors of the copyright industries and the U.S. Government report that overall IPR criminal enforcement in Russia has continued to decline in recent years, and that the focus on enforcement remains too skewed to physical piracy, not online piracy. For the past several years, however, the Government of Russia has stopped providing annual reports or enforcement statistics, so it is difficult to accurately gauge enforcement activity as a whole.