As part of CIPIT’s daily interactions with creatives, the Centre is embarking on an Intellectual Property explainer series. Tailor-made for creators.No legalese, no jargon. Just practical information. The main focus of these blogs is the various Collective Management Organisations (CMO’s) that operate in Kenya. In this blog, Cynthia Nzuki,introduces what CMO’s are, what they do and whether they are effectively and efficiently managing copyright on behalf of their members.
By Cynthia Nzuki*
Collective Management Organizations (CMOs) are private not-for-profit entities licensed to collect and distribute royalties for and among its members. In Kenya, there are presently five main CMO’s licensed by the Kenya Copyright Board (KECOBO), as mandated by the Copyright Act of Kenya. They are:
The Reproduction Rights Society of Kenya (KOPIKEN),
A tech invention may be protected through a patent, trade secret or know-how. In most cases, this innovation is first kept a secret to gain an advantage over others prior to registration and communication to the public. Amazon’s one-click sale and Google’s algorithm have been built on the companies’ confidential information. These companies’ commercial confidential information has subsequently birthed patent, industrial and trademark rights. The essential component in a successful business is that which acts as a magnetic force pulling in clients from competitors. The company’s unique process, design, business model, database, strategy among others are key components on which a business maintains its competitive advantage. Several companies, outside the tech space, like Coca-Cola and KFC are known to take extreme measures towards protecting their secret recipes resulting in their economic success.
The Internet has fundamentally altered the manner in which copyrighted works are created, distributed and accessed. The on-demand access to and transmission of works online has introduced novel methods of exploitation of copyright works not hitherto envisaged by the law. Copyright laws world wide are evolving to address the legal issues arising from this rapid technological development. For example, the European Union’s Information Society Directive (InfoSoc) 2001 was enacted within this context, to offer a high level of copyright protection to authors in the EU.
Hyperlinks, which are online network components that redirect users to another website when they click, tap or hover on it, came under scrutiny in the European Union in the case; Public Relations Consultants Association Limited (PRCA) v Newspaper Licensing Agency (NLA) C 360/13 (2013).
The PRCA, an association of public relations professionals, used a media monitoring service provided by Meltwater Limited to monitor online press reports concerning or relating to their clients. The NLA, representing the interests of newspapers i.e. the copyright holders of the published reports, took the view that the PRCA was required to obtain authorisation from the copyright holders for receiving the online media monitoring service offered by Meltwater. After both the High Court and Court of Appeal of England & Wales ruled in favour of the NLA, the PRCA instituted an appeal in the United Kingdom’s Supreme Court, which referred the case to the Court of Justice of the European Union (CJEU).
The main issue for consideration before the CJEU was whether the copies of the copyrighted material on the user’s computer screen and the copies in the internet ‘cache’ fell under the conditions of Article 5(1) of the InfoSoc Directive. This Article provides that an act of reproduction is exempted from the reproduction right provided for in Article 2 of the InfoSoc Directive, on condition that:
– it is temporary;
– it is transient or incidental;
– it is an integral and essential part of a technological process.
Central to the determination of this issue was not merely if onscreen displays and Internet cache copies are transient or temporary, but if the end user (e.g. PRCA) infringes on copyright by making of temporary copies that allows them to view the copyrighted material.
With respect to the first criterion of Article 5(1) of the InfoSoc Directive, the Court held that onscreen and cached copies of copyrighted works were temporary as the former were automatically deleted when the user exited from the website that they were viewing and the latter were often automatically replaced by other content depending on the cache’s capacity and the extent of the users internet use. It also found that the second criterion applied as onscreen and cached copies of copyrighted works were transient as the former is automatically deleted by the computer when the user exits the website and thus terminates the technological process used to view that site, and the latter were incidental as internet users could not create cached copies independently of their visit to a particular website or beyond the technological process used to view the site.
The third criterion of Article 5(1) however has direct implications on the functionality of the Internet and the court’s decision in this regard is particularly important. The Court held that on-screen and cached copies are created and deleted solely as a result of the technological process used to access websites. The reproduction as such is as such crucial in enabling users to access websites and subsequently use the Internet as a whole. Furthermore, the Court recognized the fact that the Internet would be unable to function without the creation of cached copies due to the huge volume of data transmitted online. As such, the reproduction is an integral part of the technological process as stipulated by Article 5(1) and it would be as such unjust to require the copyright holder’s authorization when browsing and viewing articles online.
The Court in PRCA v NLA (2013) also noted that the mere viewing or reading of an article in its physical form had hitherto never been an infringement in either English or EU Law. It would therefore not make sense to prohibit the mere viewing of articles online as online content is more often than not copyrighted and Internet users would become infringers if they required licenses to view content which they would inadvertently come across online. Copyright law should therefore not be used as a tool to impede Internet users’ right to browse content online freely.
Ultimately, on screen displays are transient and incidental and are an integral part of the process of browsing the Internet. Had NLA’s argument for the requirement of a license so that they could charge browsers to read content online prevailed, there would have been far reaching negative consequences as to the accessibility to the Internet by EU citizens.
While the legality of linking ‘free’ copyrighted material online, has not yet been explored in Kenyan courts, it is likely that the courts shall recognise that transient and incidental ‘copying’ that occurs in the operation of the Internet does not infringe on copyright holders’ exclusive reproduction right under section 35 of the Copyright Act (cap 130).
Copyright law should allow development and operation of new technologies while striking fair balance between copyright holders’ and the technologies’ users’ rights. Kenyan courts’ also have a duty to strike this balance. PRCA v NLA (2013) would in such cases be instrumental not only in its central finding but also in its compelling illustration of the fact that the operation of copyright online is inextricably tied to the accessibility of the Internet. This case also underscores the need for a review of the Copyright Act (Cap 130), in response to the unique challenges wrought by the operation of copyright in the digital age.
The Tobacco Regulations of 2014, which were created to protect the health of smokers and “second hand smokers”, have been criticized for a lack of regard for the right to privacy for manufacturers’ trade secrets consequently stifling the rights of corporations engaging in otherwise legal business. This regulations came under scrutiny in the case of British American Tobacco Ltd v Cabinet Secretary for the Ministry of Health & 5 others  eKLR where the appellants called for their annulment arguing that regulations 12-14, which require disclosure of key product information, violated their constitutional right to privacy and and may infringe on their intellectual property rights.
Part III of the regulations provides that the tobacco industry must provide the following information about their products:
List of ingredients in tobacco products and tobacco product components;
Reasons for including the ingredients;
All the toxicological data available to the manufacturer about the ingredients of the tobacco products and their effects on health and information on the characteristics of the leaves i.e. their type, percentage, percentage when expanded and changes made about tobacco product ingredients.
Whether the information that tobacco companies want to protect qualifies to be trade secrets is disputable. The law of confidence which is rooted in equity and legislated under article 39 of the Agreement on Trade- Related Aspects of Intellectual Property Rights (TRIPS) to which Kenya is a signatory to protects trade secrets. Article 39 of the Agreement stipulates that the following requirements must be met for information to be regarded as trade secrets: secrecy, commercial value and reasonable efforts to maintain secrecy.
Secondly, the information must have commercial value i.e. there must be some utility obtained from the information being secret. The manufacturer must be able to use it to acquire a business advantage over other manufacturer(s) in the same industry. Therefore, the information must only be known to the manufacturer to have commercial value. Disputably, players in the tobacco industry could argue that the information they guard has commercial value to them as it is what gives one company an edge over a competitor that uses different ingredients and manufacturing processes
Kenya, as a signatory to TRIPS, is obligated to protect trade secrets. These regulations do not however protect trade secrets and business ‘know-how’ once it is revealed; meaning once revealed it loses its secrecy. This leaves trade secrets and business ‘know-how’, such as the list of ingredients and percentage of leaves expanded, vulnerable to appropriation.
In taking the role of devil’s advocate, it is worth considering whether the information that the tobacco industry is required to reveal under Part III really falls within the scope of trade secrets. Let us go back in history to understand the situation as it was that caused the emergence of such requirements. In 1998, 35 million pages of what was considered confidential information were revealed as a result of the Minnesota’s Tobacco Trial in the US. This information was on the harmful ingredients that tobacco companies used in the products. In what was considered the Master Settlement Agreement, the U.S. agreed not to sue the corporations in exchange of the corporations revealing all documents considered to be confidential to the public. It is important to note that one of the companies involved in the Supreme Court application to throw out the regulations was implicated in this law suit for failing to reveal to consumers harmful ingredients contained in their tobacco products.
It is thus important to strike a balance between consumer protection measures and the protection of corporations’ intellectual property. Overzealous consumer protection regulations result in laws that infringe on corporations right to privacy and violate their intellectual property rights, to the detriment of their revenue and the country’s economy as a whole. Since the appeal was dismissed at the Supreme Court, it will be interesting to see whether the companies shall abide by the regulations.
** Mercy King’ori is a 3rd Year Bachelor of Laws student at the Strathmore University.
The theme for this year’s World Intellectual Property (WIP) Day on 26 April is ‘Powering change: Women in innovation and creativity’. According to the World Intellectual Property Organization (WIPO), this year’s WIP Day campaign ‘celebrates the brilliance, ingenuity, curiosity and courage of the women who are driving change in our world and shaping our common future.’ The UN specialised agency in charge of intellectual property (IP) urges its member states ‘to reflect on ways to ensure that increasing numbers of women and girls across the globe engage in innovation and creativity, and why this is so important.’ In Kenya, many observers note that women remain significantly underrepresented in Science, Technology, Engineering and Mathematics (STEM) despite the country’s significant progress in achieving gender parity in education.
On 14 December 2017, the World Intellectual Property Organization (WIPO) Director General Francis Gurry and Ambassador Audu Ayinla Kadiri, Permanent Representative of Nigeria to the United Nations and other International Organizations in Geneva (pictured above), signed an agreement establishing a WIPO External Office in Nigeria. Headquartered in Switzerland since 1967, WIPO is a self-funding agency of the United Nations, with 191 member states. WIPO is the global forum for intellectual property (IP) services, policy, information and cooperation. WIPO’s network of External Offices (currently in Brazil, China, Japan, Russia and Singapore) are intended to provide cost-effective support services in relation to the Patent Cooperation Treaty (PCT), Madrid and Hague systems; arbitration and mediation; collective management; and development and capacity building. In a fast-changing world, WIPO reckons that its External Offices are an increasingly important part of the Organisation’s enhanced engagement with its Member States, partners and stakeholders, on the ground, to lead the development of a balanced and effective international IP system that enables innovation and creativity for the benefit of all.
Nakumatt Holdings Limited (Nakumatt) is the proprietor of the largest supermarket retail chain in East and Central Africa. According to Superbrands, Nakumatt is one of the leading brands in East Africa with branches in Kenya Uganda, Tanzania and Rwanda. However the biggest story of 2017 has been the financial woes of Nakumatt with the retail chain facing liquidation over unpaid debts totaling over Sh30 billion. From an intellectual property (IP) perspective, Nakumatt’s brand power is based on its portfolio of over 23 registered trade marks including word marks, logos and slogans all currently subsisting on the Register of Trade Marks. This blogpost departs from the premise that the recent enactment of the Movable Property Security Rights Act was envisaged to allow individuals or businesses like Nakumatt to leverage their IP assets to access much-needed financing.
This semester, we kick off a brand new course for final year undergraduate law students on e-commerce and the law. This course aims at explaining the legal challenges that are posed by electronic commerce. We shall also contextualise and problematise on-going legal/policy developments in Kenya to regulate electronic commerce. In this blogpost, we explore the implications of the registration of domain names for trade marks. In the context of e-commerce, we examine the existing online dispute resolution mechanisms, and in particular the rules created by ICANN and KENIC for online dispute resolution of issues relating to domain-name registration.
A full day of #IGF2017 began with a content-packed session on ‘Emerging Challenges for Data Protection in Latin American Countries’. As Kenya continues to grapple with the development of a stand-alone legal framework for data protection, the experiences from Latin American may provide some insights to guide future work in this area.
Last semester I spoke to the 3rd Year Strathmore Law Class on the topic of Social Media. Being an intellectual property (IP) law class, I divided up my presentation into several key areas. Firstly, social media as the subject matter of IP, which was the focus of a previous blogpost here. Secondly, IP in Social Media with a focus on the question of intermediary liability was discussed here. Finally we concluded by considering IP advantages and disadvantages of social media before concluding by looking at two case studies from Kenya. This third point will be the focus of this blogpost.