COPYRIGHT (AMENDMENT) BILL

Order for Second Reading read.

The Parliamentary Secretary to the Minister for Law (Assoc. Prof. Ho Peng Kee): Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time."

Sir, this Bill seeks to clarify the legal status of parallel imports under the Copyright Act.

When the Copyright Act was enacted in 1987, the Government announced that its intention was to ensure that parallel imports of copyright products would be allowed. Parallel imports are foreign products which are "genuine" in terms of its manufacture but the importation or distribution of which in Singapore is unauthorised due to the existence of a local copyright owner who has not authorised the importer or distributor to do so.

Members of this House will recall that when the Minister for Law took the Copyright Bill through its Third Reading in 1987, the House was told that the Select Committee on the Bill had, after hearing arguments for and against parallel imports, decided to make it clear that parallel imports were not prohibited. This is what he had said in this House, and I quote:

`The Bill, as amended by the Select Committee, will prohibit only the importation of copies which are made in countries without copyright legislation without the consent of the copyright owner, copies made without the consent of the copyright owner under a statutory licence. The consent that we are talking about, Sir, is consent by the copyright owner in the country of manufacture in the other country, not to the importation by Singapore.'

Mr Speaker, Sir, the rationale then and now in allowing parallel imports is to benefit the consumer by not denying him the opportunity to purchase a lower-priced but legitimate edition of a work merely because the edition had originated from some other country. The Select Committee on the Copyright Bill in 1987 was particularly impressed by the evidence presented of large price differentials of authorised editions of copyright materials, in particular, books originating from different countries.

Sir, in September 1993, the Chief Justice in a copyright prosecution, ie, PP v Teoh Ai Nee and Ngoh Chin Heng decided that the importation of a copyright product and its distribution in Singapore would be unlawful if the imported article was manufactured abroad without the consent of the local owner in Singapore. Although the effect of the decision would still allow for parallel imports, for example, when the local and foreign owners are identical, one class of genuine imports - ie, those manufactured in countries whose copyright owner is different from that in Singapore and where the Singapore copyright owner has not given his consent to the manufacture of the product - would be barred.

Sir, the decision caused considerable unease amongst retailers and consumers. Uncertainties arose over the ambit of parallel imports allowed into Singapore. In view of the uncertainty prevailing in the copyright industry, the Government formed a committee to propose amendments to the Copyright Act so as to clarify the position on parallel imports. Sir, the Committee has submitted its recommendations to the Government which has accepted them.

Let me now deal with the main recommendations of the Committee. On parallel imports, the Committee based its recommendation on the fact that Government's policy on parallel imports which it enunciated in 1987 remained unchanged. To give effect to this policy, it had recommended that all legitimate reproductions of copyright products may in future be imported into Singapore regardless of who the copyright owner was. Only three classes of imports would be barred. These are:

Firstly, articles made in a country where copyright protection does not exist;

Secondly, articles made in a country where the copyright protection has expired; and

Thirdly, articles made pursuant to a compulsory statutory licence.

Sir, these recommendations will be given effect to by an amendment to section 25. The amendment will make it clear that the relevant copyright owner whose consent must be obtained is the owner in the country of manufacture except where there is no copyright owner, in which case the relevant owner would be the owner in Singapore. Let me assure Members that the amendment will not have retrospective effect. These amendments will, therefore, not affect any importation or distribution done before this amendment takes place. However, existing copyright products will be affected.

Let me now turn to the other recommendations of the Committee. The Committee also recommended the following:

Firstly, that amendments be made to prevent the use of copyright in product packaging as a ground to repel otherwise legitimate products. Product packaging should therefore be ignored if the product itself is not an infringing copy. However, instructional manuals accompanying computer software should enjoy copyright protection as these are substantive works in themselves.

Secondly, that an anomaly under the current design copyright law be rectified, ie, that the design copyright owner who industrially applies his work overseas be placed in no better position than his local counterpart who industrially applies his design here. This anomaly was pointed out in a recent High Court decision of Lance Court Furnishings Pte Ltd v PP.

These recommendations will be given effect to in the Bill by the introduction of two new sections, ie, section 40A and 116A in the Copyright Act. In addition, the word "accessory" for the purpose of product packaging is given a wide definition in section 7(1) of the Copyright Act which is amended to incorporate the definition.

Sir, the Government is mindful of the need to achieve a proper balance between ensuring cheaper prices for consumers and providing sufficient incentives for copyright industries to develop and remain competitive. The Government's policy on parallel imports is to prevent copyright owners and exclusive distributors here from carrying out price maintenance and discriminatory practices at the expense of consumers. Closing our markets to genuine products from other countries is also inconsistent with our advocacy of free and fair competition.

Sir, I beg to move.

Question proposed.

Mr Choo Wee Khiang (Jalan Besar GRC): Mr Speaker, I rise to speak in support of the Bill.

The Bill introduces amendments that will clearly reflect Government's policy of allowing genuine products, ie, copyright products, to be imported into Singapore by persons other than the authorised distributors. This clarification is to be welcomed as it will inject certainty into our law and practice. Sir, this is in line with Singapore's free market policy. To me, it makes sense that if a product is not a counterfeit or pirated copy, but a genuine product made with the consent of the copyright owner in the country of manufacture, such a product should be allowed to be imported and sold in Singapore. This will enable Singaporeans to have a wider choice of products which they can purchase and also at cheaper prices. Sir, this is important as we want to build Singapore into a shoppers' paradise. I have no doubt that this factor of variety and price will work towards the benefit of consumers.

I have only one small question to ask, ie, if an authorised distributor of a foreign country were to sell his products to an authorised distributor in Singapore, will that be considered as an infringement of the copyright law? I am pleased with the approach that the Ministry has taken on this matter. It was a carefully considered one. No doubt, it has taken some time. But at least the position is now clear. The Government has reaffirmed the policy that it announced in 1987 of allowing parallel imports which are now more clearly defined under the Bill.

Once again, I support the Bill.

Assoc. Prof. Ho Peng Kee: Sir, I thank the Member for his support of the Bill. He asked one query. The point to note is that whether or not it is an infringing copy under the Act depends on whether or not consent has been given by the copyright owner in the country of manufacture as to the manufacture of the product. We have to distinguish between a manufacturing process and a right of distribution.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. - [Assoc. Prof. Ho Peng Kee].

Bill considered in Committee; reported without amendment; read a Third time and passed.