[Congressional Record Volume 144, Number 144 (Monday, October 12, 1998)]
[Senate]
[Pages S12377-S12378]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                SONNY BONO COPYRIGHT TERM EXTENSION ACT

  Mr. HATCH. Mr. President, I am delighted at the recent passage of S. 
505, the Sonny Bono Copyright Term Extension Act. The main purpose of 
the bill is to ensure adequate copyright protection for American works 
abroad by extending the U.S. term of copyright protection for an 
additional 20 years. The late Sonny Bono was an avid supporter of the 
bill, and he fully appreciated what its passage would mean to the 
American economy. It is therefore an appropriate memorial to this fine 
American.
  20 years ago, Mr. President, Congress fundamentally altered the way 
in which the U.S. calculates its term of copyright protection by 
abandoning a fixed-year term of protection and adopting a basic term of 
protection based on the life of the author. In adopting the life-plus-
50 term, Congress cited three primary justifications for the change: 
(1) the need to conform the U.S. copyright term with the prevailing 
worldwide standard; (2) the insufficiency of the U.S. copyright term to 
provide a fair economic return for authors and their dependents; and, 
(3) the failure of the U.S. copyright term to keep pace with the 
substantially increased commercial life of copyrighted works resulting 
from the rapid growth in communications media.
  Developments over the past 20 years have led to a widespread 
reconsideration of the adequacy of the life-plus-50-year term based on 
these same reasons. Among the main developments is the effect of 
demographic trends, such as increasing longevity and the trend toward 
rearing children later in life, on the effectiveness of the life-plus-
50 term to provide adequate protection for American creators and their 
heirs. In addition, unprecedented growth in technology over the last 20 
years, including the advent of digital media and the development of the 
national Information Infrastructure and the Internet, have dramatically 
enhanced the marketable lives of creative works. Most importantly, 
though, is the growing international movement towards the adoption the 
longer term of life-plus-70.
  Thirty five years ago, the Permanent Committee of the Berne Union 
began to reexamine the sufficiency of the life-plus-50-year term. Since 
then, a growing consensus of the inadequacy of the life-plus-50 term to 
protect creators in an increasingly competitive global marketplace has 
lead to actions by several nations to increase the duration of 
copyright. Of particular importance is the 1993 directive issued by the 
European Union, which requires its member countries to implement a term 
of protection equal to the life of the author plus 70 years by July 1, 
1995.
  According to the Copyright Office, all the states of the European 
Union have now brought their laws in compliance with the directive. 
And, as the Register of Copyrights has stated, those countries that are 
seeking to join the European Union, including Poland, Hungary, Turkey, 
the Czech Republic, and Bulgaria, are likely, as well, to amend their 
copyright laws to conform with the life-plus-70 standard.
  The reason this is of such importance to the United States is that 
the EU Directive also mandates the application of what is referred to 
as ``the rule of the shorter term.'' This rule may also be applied by 
adherents to the Berne Convention and the Universal Copyright 
Convention. In short, this rule permits those countries with longer 
copyright terms to limit protection of foreign works to the shorter 
term of protection granted in the country of origin. Thus, in those 
countries that adopt the longer term of life-plus-70, American works 
will forfeit 20 years of available protection and be protected instead 
for only the duration of the life-plus-50 term afforded under U.S. law.
  Mr. President, as I've said previously, America exports more 
copyrighted intellectual property than any country in the world, a huge 
percentage of it to nations of the European Union. In fact, in 1996, 
the core U.S. copyright industries achieved foreign sales and exports 
exceeding $60 billion, surpassing, for the first time, every other 
export sector, including automotive, agriculture and aircraft. And, 
according to 1996 estimates, copyright industries account for some 5.7 
percent of the total gross domestic product. Furthermore, copyright 
industries are creating American jobs at nearly three times the rate of 
other industries, with the number of U.S. workers employed by core 
copyright industries more than doubling between 1977 and 1996. Today, 
these industries contribute more to the economy and employ more workers 
than any single manufacturing sector, accounting for over 5 percent of 
the total U.S. workforce. In fact, in 1996, the total copyright 
industries employed more workers than the four leading noncopyright 
manufacturing sectors combined.
  Clearly, Mr. President, America stands to lose a significant part of 
its international trading advantage if our copyright laws do not keep 
pace with emerging international standards. Given the mandated 
application of the ``rule of the shorter term'' under the EU Directive, 
American works will fall into the public domain 20 years before those 
of our European trading partners, undercutting our international 
trading position and depriving copyright owners of two decades of 
income they might otherwise have. Similar consequences will follow in 
those nations outside the EU that choose to exercise the ``rule of the 
shorter term'' under the Berne Convention and the Universal Copyright 
Convention.
  The public performance of musical works is one of the copyright 
rights that will be benefited by the 20-year extension. But--
ironically--in title II of the bill, Mr. President, we are cutting back 
on that right by expanding the exemption that currently exists in the 
Copyright Act for ``mom-and-pop'' establishments. Because of the public 
performance right, businesses that use music to attract customers are 
required to obtain a license. The licenses can be obtained from the 
performing rights organizations (PROs), namely, ASCAP, BMI, and SESAC. 
The PROs, in turn, pay the owners of copyright in

[[Page S12378]]

the music--music publishers, composers, and/or songwriters--from the 
proceeds. Because the rates charged by the two biggest PROs, ASCAP and 
BMI, are monitored by the Rate Court of the U.S. District Court of the 
Southern District of New York, the rates today amount to a very small 
amount per annum per business. The rates are even smaller for the kinds 
of performances covered by title II of the bill--performances of music 
over television and radio sets that businesses turn on for the benefit 
of their customers. And, as I said, ``mom-and-pop'' establishments do 
not have to pay anything. Nevertheless, some have sought for over 3 
years to eliminate the licensing of music that arrives in a business 
establishment through the reception of radio and TV signals.
  I have a stellar record in supporting legislation that benefits small 
business, but this includes songwriters, who themselves are small 
businesses. I have yet to discover a reason to eliminate or even reduce 
the charge for the commercial use of some one else's property. In my 
view, property is property whether it's dirt or intangible, and I have 
always been a defender of property rights.
  The associations that want to eliminate the public performance right 
for business establishments have held up passage of copyright term 
extension for more than three years, although they had no quarrel with 
copyright term extension on its merits. Since copyright term extension 
is so important to America, Mr. President, I began a series of 
negotiations last year to try to resolve the problem. Other 
negotiations were begun by others, and, in the end, a compromise was 
worked out. This compromise is included in title II of the bill.
  Title II greatly expands the current ``mom-and-pop'' exemption in the 
Copyright Act. Indeed, data supplied by the Congressional Research 
Service reveals that over 65.2% of restaurants will be exempt.
  But lest we think that the music licensing issue has been put to bed, 
I want to sound a note of caution. Despite the months of negotiations 
that produced title II, an unanticipated problem popped up just as a 
compromise was reached--the exemption contained in title II applies to 
radio broadcasts licensed by the FCC and does not cover Internet radio. 
We did not have time to address this problem, and, frankly, the novel 
nature of Internet radio precluded a simple solution. This issue 
concerns me, however, and I will turn to the music licensing question 
again in the future, if I see that a disparity exists between FCC-
licensed radio and Internet radio. I would not want businesses to turn 
away from new technology because of artificial forces acting on the 
market. If we do turn to this question, we may discover that it is 
impossible to integrate Internet radio and TV into the exemption 
without modifying its scope.
  Nevertheless, Mr. President, on balance, S. 505 is a good bill. I'm 
glad it passed, and I'm glad that a compromise was worked out on music 
licensing to allow the copyright term to be extended. I thank all who 
had a hand in the solution.

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