IP News

Retransmission via “Must Carry Rule,” Not Infringement

February 02, 2009

Making broadcast signals part of a cable or satellite company’s program lineup in compliance with the “Must-Carry Rule” is not “rebroadcasting” and does not therefore infringe the IP rights of broadcasters.

The Supreme Court (G.R. No. 175769-70, January 19, 2009) thus affirmed the decision of the Court of Appeals dismissing the petition of ABS-CBN Broadcasting Corporation (ABS-CBN) that sought to charge Philippine Multi-Media System, Inc. (PMSI) - a direct to home satellite service company - fees to carry ABS-CBN’s broadcast signal in PMSI’s program line-up.

National Telecommunications Commission (NTC) Memorandum Circular No. 4-08-88 contains the Philippine version of the “Must-Carry Rule.” The rule mandates the compulsory carriage by cable service providers of television signals being broadcast within a cable company’s area of coverage.

The Supreme Court held that both ABS-CBN and PMSI both operate by virtue of a legislative franchise and are thus subject to reasonable burdens of public service, such as the “Must-Carry Rule.” Just as PMSI has the obligation to retransmit ABS-CBN’s signals, ABS-CBN has the obligation to allow PMSI to retransmit its signals under the rule.

The Court pointed out that the rule is one such limitation on copyright under Section 184 (h) of the Intellectual Property Code, which states that “[t]he use made of a work by or under the direction or control of the Government, by the National Library or by educational, scientific or professional institutions where such use is in the public interest and is compatible with fair use” shall NOT constitute infringement of copyright.

“The carriage of ABS-CBN’s signals by virtue of the must-carry rule in Memorandum Circular No. 04-08-88 is under the direction and control of the government though the NTC which is vested with exclusive jurisdiction to supervise, regulate and control telecommunications and broadcast services/facilities in the Philippines. The imposition of the must-carry rule is within the NTC’s power to promulgate rules and regulations, as public safety and interest may require, to encourage a larger and more effective use of communications, radio and television broadcasting facilities, and to maintain effective competition among private entities in these activities whenever the Commission finds it reasonably feasible,” the Court said.

The High Court also differentiated “rebroadcasting” from “retransmission” of broadcast signals. Rebroadcasting is defined in Article 3(g) of the International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations (the “Rome Convention”), of which the Philippines is a signatory, as “the simultaneous broadcasting by one broadcasting organization of the broadcast of another broadcasting organization.” It presupposes that rebroadcasted programs have been altered so as to be attributed to the rebroadcaster as the origin of the broadcast. This, the Court said, is different from retransmission, which is both simultaneous and unaltered.

“[W]hile the Rome Convention gives broadcasting organizations the right to authorize or prohibit the rebroadcasting of its broadcast, however, this protection does not extend to cable retransmission. The retransmission of ABS-CBN’s signals by PMSI – which functions essentially as a cable television – does not therefore constitute rebroadcasting in violation of the former’s intellectual property rights under the IP Code,” the Court pointed out.

The Supreme Court, however, found no need to pass upon the constitutionality of the “Must Carry Rule” itself as such was belatedly raised in the proceedings and the High Court could resolve the case without having to do so.

By: Madeleine G. Avanzado

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