6 of dollars in placing a new copyright notice on all the prints distributed and changing the master negatives so that the copyright notice was accurate. No other major country's law would have necessitated this expense. All those countries can live without requiring copyright notices, and so can we. Moral Rights "Issue". You may recall that at the beginning of my testimony I noted that there were two changes that had occurred in recent years which altered our opinion on the Berne adherence question. The first was the emergence of film piracy and the realization on the part of American motion picture companies that there were advantages to adhering to the Berne Convention that would benefit them in their fight against film pirates. The second change involved the development of the law in this country, to the point that it now affords sufficient protection for creative artists so as to meet Berne requirements in this area. Enactment of special moral rights legislation by this body is therefore not necessary for Berne adherence. Nor is it, in our view desirable. It is not our purpose here to reiterate the scholarly work addressing the moral rights provision of the Paris Act of the Berne Convention, done by the blue ribbon panel of experts who worked under the auspices of the Department of State. In their published report on this issue, those experts analyzed the laws and court decisions on both the federal and state level and concluded as follows: Given the substantial protection now available for the real equivalent of moral rights under the statutory and common law in the U.S., the lack of uniformity in protection of other Berne nations, the absence of moral rights provisons in some of their copyright laws, and the reservation of control over remedies to each Berne country, the protection of moral rights in the United States is compatible with the Berne Convention. The panel has in essence said, in more eloquent language, that the United States already complies with the Berne Convention with respect to its requirements in Article 6bis. Because of our strong interest in the topic over the years, we are aware of the state of the law in this area and confirm the conclusion of the State Department panel of experts that no federal moral rights law need be enacted to adhere to the Berne Convention. I mentioned to you earlier that motion picture companies have traditionally been concerned about this issue of moral 7 rights, because it could play mischief with the freedoms and creative processes necessary for our industry to develop new, original works. The member companies of the MPAA oppose in principle the establishment of any so called "moral rights" laws. We do, however, agree with Senator Leahy's view that the minimal requirements of Article 6bis are satisfied by the right to prepare a derivative work found in Section 106 of our Copyright Act and by the law of defamation. Legislation relating to Berne adherence should include, as an absolutely critical element, provisions similar to those found in Congressman Moorhead's bill that state: (1) the Berne Convention is neither self-executing nor (2) (3) (4) (5) the Copyright Act does not provide any author with a paternity right; the existing law and the implementing legislation changes in state or federal law are not necessary to meet our obligation under the Convention; and except as specifically granted in the implementing legislation, no rights may be enlarged as a result of adherence to the Berne Convention. Conclusion. In summary, there are many benefits to the motion picture industry in this country if we were to join the Berne Copyright Convention. We have serious problems with film piracy around the world, and adherence to this important copyright treaty would aid us in our efforts to stem that tide. Joining the Berne Convention would also free American motion picture companies from needless formalities present in our current law, such as mandatory use of copyright notices. We advocate adherence to the Berne Convention by way of implementing legislation that finds existing U.S. law sufficient to meet Berne moral rights standards, and that does not contain any provisions enacting a Federal moral rights law. Thank you for your consideration of our views. Mr. KASTENMEIER. Thank you, Mr. Nolan, for ably presenting the views of the Motion Picture Association of America. Before we present you with questions, however, we would like to hear from Mr. Kenneth Dam. Mr. Dam. STATEMENT OF KENNETH W. DAM Mr. DAM. Mr. Chairman, before beginning my oral statement, I would like to request that my written statement as well as the position paper of the National Committee for the Berne Convention be inserted in the record. Mr. KASTENMEIER. Without objection, that will be done. I believe in the case of Mr. Nolan, you did follow the text of your statement so precisely that such a request is not necessary in your case. Mr. Dam. Mr. DAM. I am Kenneth W. Dam, vice president, law and external relations, of the IBM Corp. IBM is grateful for the opportunity to testify before this subcommittee to express its strong support for U.S. adherence to the Berne Convention. IBM's decision to support actively U.S. adherence to Berne is the result of thoughtful deliberation in which we took into account both our interests in improving worldwide intellectual property protection through the GATT and the importance to IBM of copyright protection both here and abroad. We evaluated all of our publishing activities that are protected by copyright in the context of what has been called the moral rights "issue" that is presented by Berne adherence, and have found that they are not affected by adherence. This allows us to support U.S. adherence-not reluctantly, but actively-because we believe that the benefits of U.S. adherence are significant, immediate and tangible. I would like to elaborate briefly on IBM's various copyright interests, for some may believe that IBM is not in the same position as the publishing and other "more traditional" copyright industries. The fact is that we are really not in a different position. For example, through our subsidiary, Science Research Associates, we are one of the largest publishers of textbooks and other educational materials. Moreover, IBM creates, and we have created for us, a vast number of materials which involve many contributors in all forms of media. These include motion pictures, film strips, multi-media educational materials, books and manuals, as well as print advertising, and radio and television commercials. They include works in English and many foreign languages-and over 4,000 computer programs published each year. A significant number of the computer programs we market are acquired in whole or in part from other companies and from individuals. Many of our advertising campaigns are for introduction of new products and must meet very tight deadlines and publication and broadcast schedules. IBM would have to foot the bill, directly or indirectly, if there were claims for any moral rights violations by any of the persons from whom we acquire rights in any of these activities. Thus, just like Berne's opponents, we face time pressures and contracts with freelance writers and photographers. We have as much at stake in the moral rights debate as anyone in the publishing or other copyright industries. We are not claiming the benefits of Berne while expecting others to suffer risks. If there were risks, they would be our risks just as much. We are firmly convinced, however, that there is no such risk in adopting Berne. In short, we do not believe that adherence poses a moral rights problem. Our examination has led us to the conclusion that current U.S. protection of moral rights is fully compatible with article 6 bis of Berne and that adoption of the Convention will require no change in Federal or State statutory or common law-either directly or indirectly as a result of that provision. The question whether to reduce or expand moral rights in this country is a totally separate issue from that of Berne. Each of these issues should be considered on its own merits. The wall separating the two issues can be strengthened even further by comprehensive implementing legislation. We believe that the bill introduced by Representatives Kastenmeier and Moorhead, for example, contains several excellent provisions which emphasize that Berne will not be self-executing and which, taken together, clear up any confusion that might persist on that point. Such congressional findings clearly meet the concerns of opponents of U.S. adherence that in implementing Berne we might somehow import foreign moral rights regimes or encourage a creeping expansion of moral rights. These provisions make it clear that anyone seeking the benefit of U.S. obligations under Berne can make a claim only under the provisions of U.S. domestic law. In the face of such an express intent of the Congress and a congressional finding that our present law on this subject is-without change-fully compatible, it should not be possible for American courts to enlarge moral rights protection. As I have already indicated, IBM believes that the benefits of U.S. adherence are significant, immediate and tangible. With U.S. adherence to Berne, U.S. copyright owners will save substantial administrative expenses. IBM will save an estimated $10 million each year by avoiding the need to obtain protection for software via the back door. We will also avoid the costly mistakes that can be made because of the complexities and uncertainties in going through socalled "simultaneous publication" just to gain that back-door protection. Our Register of Copyrights tells us that the People's Republic of China is contemplating joining the Berne Convention. It would be ironic if they did join after much prodding from us, and we refused. On July 23, 1987, the subcommittee heard from Ambassador Yeutter, the late Secretary Baldrige, and Under Secretary Wallis on how U.S. adherence will help our trade negotiators gain improved intellectual property protection worldwide. I will not repeat their arguments, but let me support them with evidence based on IBM's experiences. IBM markets its products throughout the world and, in doing so, earns substantial revenues which help to reduce the substantial deficit in the U.S. current account. These revenues are significant ly impaired, however, by the international piracy of IBM's copyrighted works. In numerous discussions with both private-sector and governmental representatives in Europe and Japan, we have discovered the importance they attach to U.S. adherence to Berne. For them, it is a litmus test of our seriousness and our willingness to work with them-rather than just unilaterally-in improving intellectual property protection worldwide. On intellectual property issues, the resolve of the U.S. is constantly being tested. U.S. adherence to Berne is such a test. In our opinion, if the United States fails to adhere now, that failure will damage severely the credibility of the United States in the GATT negotiations. For all of these reasons, IBM strongly supports U.S. adherence to the Berne Convention. Equally strongly, we believe that we should adhere without the enactment of specific moral rights provisions in the enabling legislation. We are not alone. We join the several dozen companies and associations of the National Committee for the Berne Convention-actually, the thousands of member companies and individuals represented by those associations-in supporting U.S. adherence to the Berne Convention. Thank you. [The statements of Mr. Dam and of the National Committee for the Berne Convention follow:] |