[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[S. 2423 Introduced in Senate (IS)]

103d CONGRESS
  2d Session
                                S. 2423

To amend the provisions of title 17, United States Code, to provide for 
 the auction of certain copyrights to financially support the National 
 Endowment for the Arts and the National Endowment for the Humanities, 
                        and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

              August 25 (legislative day, August 18), 1994

Mr. Dodd (for himself, Mr. Bingaman, and Mr. Metzenbaum) introduced the 
 following bill; which was read twice and referred to the Committee on 
                             the Judiciary

_______________________________________________________________________

                                 A BILL


 
To amend the provisions of title 17, United States Code, to provide for 
 the auction of certain copyrights to financially support the National 
 Endowment for the Arts and the National Endowment for the Humanities, 
                        and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Arts Endowing the Arts Act of 
1994''.

SEC. 2. COPYRIGHT AUCTION FOR THE NATIONAL ENDOWMENTS FOR THE ARTS AND 
              HUMANITIES.

    (a) In General.--The provisions of title 17, United States Code, 
are amended by adding after chapter 9 the following new chapter:

``CHAPTER 10--AUCTION OF CERTAIN COPYRIGHTS FOR THE NATIONAL ENDOWMENT 
       FOR THE ARTS AND THE NATIONAL ENDOWMENT FOR THE HUMANITIES

``Sec.
``1001. Definitions.
``1002. Copyrights affected.
``1003. Arts and Humanities Copyright Board.
``1004. Auction procedures.
``1005. Registration and issuance of certificate for auction copyright.
``1006. Limitation on the liability of the United States.
``1007. Original copyright not affected by auction.
``1008. National Endowments for the Arts and Humanities Copyright Trust 
                            Fund.
``Sec. 1001. Definitions
    ``For purposes of this chapter--
            ``(1) the term `auction copyright' means a copyright which 
        is acquired under the provisions of this chapter;
            ``(2) the term `Board' means the Arts and Humanities 
        Copyright Board established under section 1003; and
            ``(3) the term `Fund' means the National Endowments for the 
        Arts and Humanities Copyright Trust Fund established under 
        section 1008.
``Sec. 1002. Copyrights affected
    ``The provisions of this chapter apply to any copyright in a--
            ``(1) literary work;
            ``(2) sound recording;
            ``(3) work of visual art;
            ``(4) pictorial, graphic, and sculptural work; or
            ``(5) motion picture.
``Sec. 1003. Arts and Humanities Copyright Board
    ``(a) Establishment.--There is established the Arts and Humanities 
Copyright Board within the Library of Congress.
    ``(b) Membership.--The Board shall be composed of 9 members, 
appointed by the President, of whom--
            ``(1) 1 shall be selected upon the recommendation of the 
        Chairman of the National Endowment for the Arts;
            ``(2) 1 shall be selected upon the recommendation of the 
        Chairman of the National Endowment for the Humanities;
            ``(3) 1 shall be selected upon the recommendation of the 
        Register of Copyrights;
            ``(4) 1 shall be selected upon the recommendation of the 
        Majority Leader of the Senate;
            ``(5) 1 shall be selected upon the recommendation of the 
        Minority Leader of the Senate;
            ``(6) 1 shall be selected upon the recommendation of the 
        Majority Leader of the House of Representatives;
            ``(7) 1 shall be selected upon the recommendation of the 
        Minority Leader of the House of Representatives; and
            ``(8) 2 shall represent the arts community and be notable 
        for contributions to excellence in their fields.
    ``(c) Chairman.--The Board shall select a chairman from the members 
of the Board.
    ``(d) Quorum.--A majority of the members of the Board shall 
constitute a quorum.
    ``(e) Functions.--The Board shall select copyrights in works for 
auction and conduct auctions as provided under this chapter.
    ``(f) Compensation.--The members of the Board shall receive 
compensation at the rate payable for a position at level V of the 
Executive Schedule under section 5316 of title 5 for each day in the 
actual performance of duties for the Board.
    ``(g) Travel Expenses.--The members of the Board shall be allowed 
travel expenses, including per diem in lieu of subsistence, at rates 
authorized for employees of agencies under subchapter I of chapter 57 
of title 5 while away from their homes or regular places of business in 
the performance of services for the Board.
    ``(h) Special Government Employees.--A member of the Board shall be 
a special Government employee as for purposes of sections 203, 204, 
207, 208, and 209 of title 18.
``Sec. 1004. Auction procedures
    ``(a) Selection of Copyrights for Auction.--During the first week 
of January and the first week of July of each year, the Board shall 
conduct an auction of any copyright described under section 1002 
selected by the Board. The Board may select a copyright for an auction 
under this chapter if--
            ``(1) the term of the copyright--
                    ``(A) shall expire within 6 months after the date 
                of the auction of the copyright; and
                    ``(B) is not subject to renewal and extension under 
                this title; or
            ``(2)(A) the term of the copyright--
                    ``(i) shall expire within 6 months after the date 
                of the auction of the copyright; and
                    ``(ii) is subject to renewal and extension under 
                this title; and
            ``(B) the owner of the copyright has not--
                    ``(i) registered for a renewal and extension of the 
                term of such copyright; or
                    ``(ii) submitted written notice to the Board or the 
                Copyright Office of an intent to renew and extend the 
                term of such copyright and the Board determines that 
                such term is subject to renewal and extension.
    ``(b) Copyrights for Auction Selected Upon Bidder's Initiative.--
The Board shall select a copyright for an auction if the Board--
            ``(1) receives a bid for a copyright that meets all of the 
        requirements for selection under this section within such 
        period as determined by the Board; and
            ``(2) determines the bid is of a sufficient minimum amount 
        for the copyright.
    ``(c) Copyrights Excluded From Auction.--The Board may not auction 
a copyright in any work--
            ``(1) in which a person owned a copyright;
            ``(2) in which the term of such copyright expired without 
        renewal and extension; and
            ``(3) that entered the public domain.
    ``(d) Notification.--(1) No later than 45 days before the date of 
an auction, the Board shall publish in the Federal Register--
            ``(A) the date of the auction;
            ``(B) a description of the copyrights and works relating to 
        such copyrights to be auctioned;
            ``(C) a description of all works--
                    ``(i) in which a copyright shall be auctioned; and
                    ``(ii) for which a bid has been submitted; and
            ``(D) the minimum bids set by the Board.
    ``(2) The Board may take such other actions as necessary to give 
public notice of the information described under paragraph (1).
    ``(e) Auction Copyright Bids.--(1) The Board shall set a minimum 
amount for each bid for a copyright to be auctioned. If no bid is 
submitted to the Board equal to or greater than the minimum amount set 
for a copyright in any work, no auction copyright may be issued for the 
work.
    ``(2) Each bid shall--
            ``(A) be sealed;
            ``(B) be submitted during such period as the Board may 
        determine; and
            ``(C) include an amount equal to 20 percent of the total 
        amount of the submitted bid which shall be deposited in the 
        Fund.
    ``(3) A person shall be the successful bidder on a copyright if 
such person--
            ``(A) submits the highest bid on such copyright;
            ``(B) deposits the total amount of the submitted bid in the 
        Fund; and
            ``(C) complies with such terms and conditions as the Board 
        may require.
    ``(4)(A) The Board shall pay to each person who submitted an 
unsuccessful bid all amounts deposited in the Fund under paragraph 
(2)(C) with interest at a rate determined under subparagraph (B).
    ``(B) For any 12-month period beginning on July 1 and ending on 
June 30 the rate determined under this subparagraph is determined on 
the preceding June 1 and is equal to the bond equivalent rate of 52-
week Treasury bills auctioned at the final auction held prior to such 
June 1.
``Sec. 1005. Registration and issuance of certificate for auction 
              copyright
    ``(a) Notification to Copyright Office.--The Board shall determine 
the person making the successful bid for a copyright in a work at an 
auction and notify the Copyright Office.
    ``(b) Registration and Issuance of Certificate.--After receiving 
notification from the Board and payment of fees for a copyright claim 
and registration under section 708(a)(1) by the person making the 
successful bid at auction, the Register of Copyrights shall register a 
copyright claim and issue a certificate of registration to such person 
in accordance with section 410.
    ``(c) Duration of Term.--The term of an auction copyright in a work 
shall be for 20 years and shall begin on the date following the date of 
the expiration of the term of the copyright in such work last held 
under the provisions of this title (other than this chapter).
    ``(d) Nonrenewal of Auction Copyright.--An auction copyright may 
not be renewed or extended.
``Sec. 1006. Limitation on the liability of the United States
    ``If a person acquires an auction copyright in a work and the 
Copyright Royalty Tribunal or a court of the United States later 
determines that such person is not the owner of such copyright or that 
such copyright is invalid or infringes on another copyright in such 
work, the liability of the United States shall be limited to--
            ``(1) all amounts that such person deposited in the Fund 
        for the auction copyright; and
            ``(2) interest on such amounts at the rate determined under 
        section 1004(e)(4)(B).
``Sec. 1007. Original copyright not affected by auction
    ``The auction of a copyright in any work under this chapter shall 
have no effect on--
            ``(1) any other copyright in such work; or
            ``(2) the rights or privileges of any owner, holder, heir, 
        or assignee of any other copyright in such work.
``Sec. 1008. National Endowments for the Arts and Humanities Copyright 
              Trust Fund
    ``(a) Establishment.--There is established the National Endowments 
for the Arts and Humanities Copyright Trust Fund in the Treasury of the 
United States.
    ``(b) Deposits.--The Fund shall consist of all amounts deposited by 
the Board from auction bids and payments under section 1004 and any 
interest earned on investment of amounts in the Fund under subsection 
(d)(2) of this section.
    ``(c) Appropriations From Fund.--The amounts in the Fund shall 
remain in the Fund without fiscal year limitation and shall be 
available for annual appropriation by the Congress for--
            ``(1) the support of the National Endowment for the Arts 
        and the National Endowment for the Humanities; and
            ``(2) the administrative costs of carrying out this 
        chapter.
    ``(d) Investment of Funds.--(1) It shall be the duty of the 
Secretary of the Treasury to invest such portion of the Fund as is not, 
in the Secretary's judgment, required to meet current withdrawals. Such 
investments may be made only in interest-bearing obligations of the 
United States or in obligations guaranteed as to both principal and 
interest by the United States. For such purpose, such obligations may 
be acquired--
            ``(A) on original issue at the issue price, or
            ``(B) by purchase of outstanding obligations at the market 
        price.
The purposes for which obligations of the United States may be issued 
under chapter 31 of title 31, of the United States Code, are hereby 
extended to authorize the issuance at par of special obligations 
exclusively to the Fund. Such special obligations shall bear interest 
at a rate equal to the average rate of interest, computed as to the end 
of the calendar month next preceding the date of such issue, borne by 
all marketable interest-bearing obligations of the United States then 
forming a part of the Public Debt; except that where such average rate 
is not a multiple of one-eighth of 1 percent, the rate of interest of 
such special obligations shall be the multiple of one-eighth of 1 
percent next lower than such average rate. Such special obligations 
shall be issued only if the Secretary of the Treasury determines that 
the purchase of other interest-bearing obligations of the United 
States, or of obligations guaranteed as to both principal and interest 
by the United States on original issue or at the market price, is not 
in the public interest.
    ``(2) Any obligation acquired by the Fund (except special 
obligations issued exclusively to the Fund) may be sold by the 
Secretary of the Treasury at the market price, and such special 
obligations may be redeemed at par plus accrued interest.
    ``(3) The interest on, and the proceeds from the sale or redemption 
of, any obligations held in the Fund shall be credited to and form a 
part of the Fund.''.
    (b) Technical and Conforming Amendment.--The table of chapters for 
title 17, United States Code, is amended by adding after the item 
relating to item 9 the following new item:

``10. Auction of certain copyrights for the National           1001.''.
                            Endowment for the Arts and the 
                            National Endowment for the 
                            Humanities.

SEC. 3. EFFECTIVE DATE.

    (a) In General.--Except as provided under subsection (b), the 
provisions of this Act and the amendments made by this Act shall take 
effect 30 days after the date of the enactment of this Act.
    (b) First Auction.--The Arts and Humanities Copyright Board 
established under chapter 10 of title 17, United States Code, as added 
by this Act, shall determine the date of the first copyright auction, 
except such auction shall occur--
            (1) during the first week of January or July; and
            (2) no later than 18 months after the date of the enactment 
        of this Act.
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