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In this decision, the Federal Court of Canada (the Court) examined three applications for judicial review arising out of the December 12, 2003 decision of the Copyright Board of Canada (the Board) pertaining to the establishment of private copying levies to be collected by the Canadian Private Copying Collective (the CPCC) for 2003 and 2004. The Board's decision will be referred to as Private Copying III. The Court joined the applications and heard them together.
BACKGROUND
The Copyright Act55 (the Act), under Part VIH, permits the copying of recorded music for private use but also allows certain authors, performers and makers of recorded music (rights-holders) to receive compensation, by way of a levy on media (i.e., blank recordable CDs) used to copy music, for their loss of exclusiveness to their work.
As an administrative tribunal created under the Act, the Board oversees the creation of levies for the private copying of recorded musical works, performances and sound recordings on blank audio recording media that are sold or otherwise disposed of in Canada.
Prior to Private Copying III, which is the focus of the Federal Court of Appeal's decision and was the Board's third private copying tariff, the Board certified two private copying tariffs. The first decision occurred in 1999 (Private Copying I) and the second in 2001 (Private Copying II).
As a not-for-profit corporation whose members are comprised of collective societies that hold private copying remuneration rights for rights-holders, the CPCC is designated by the Board pursuant to the Act to collect from manufacturers and importers of blank media in Canada and distribute to rights-holders the levies approved by the Board.
The Board certifies "fair and equitable" levies after considering proposals presented by the CPCC. In its 2003-2004 proposal, the CPCC requested that levies be placed on certain new forms of recording media such as recordable or rewritable DVDs, removable electronic memory cards, and non-removable memory permanently embedded in so called "digital audio recorders" (which are generally known as "MP3 Players").
The Board in Private Copying III retained the existing levies for audio cassettes, MiniDiscs, recordable compact disks (CD-Rs), rewritable compact discs (CD-RWs), recordable audio compact discs (Audio CD-Rs), and rewritable audio compact discs (Audio CD-RWs). While the Board found that embedded memory in...