The Copyright Board issued last week the following short decision, holding that there is no Crown Immunity in copyright:
 Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island, Saskatchewan and the territorial government of Nunavut (collectively the Objectors) rely on the principle of Crown immunity, as codified in section 17 of the Interpretation Act, to claim that the Copyright Act (the “Act”) does not apply to them and that, consequently, the tariffs proposed by Access Copyright in respect of Provincial and Territorial governments cannot bind them.
 The Objectors’ claim for crown immunity is dismissed by reason that the Act binds the Crown by necessary implication.
 We find it necessary to inform the parties of our decision in the matter without further delay, with reasons to follow, to allow them to fully prepare and meet the October 2, 2012 hearing date.
The decision arises from a Proposed Tariff by Access Copyright to be levied on Canada’s Provincial and Territorial governments.
It is a fundamental principle of the Common Law, now codified in s. 17 of the Interpretation Act, 1985 and in similar Provincial legislation that:
17. No enactment is binding on Her Majesty or affects Her Majesty or Her Majesty’s rights or prerogatives in any manner, except as mentioned or referred to in the enactment.
There is no question that the Copyright Act (or any other act for that mater) does not contain any provision that expressly binds the Crown. Nevertheless, the Board’s short decision indicates that according to the Board the “necessaary implication” exception to this rule applies in this case and it will be interesting to read the Board’s full reasons.
As far as I know, the question has never been decided before and the holding that the Copyright Act binds the Crown by necessary implication is far from being straightforward. After all, copyright legislation has more than three hundred years of history and if Parliament never decided to bind the Crown despite numerous rounds of copyright reform, maybe the answer is that the Act does not bind the Crown. Interestingly, in the US, whose copyright legislation is based on the same British legislation as that of Canada, it has been established that the Copyright Act does not bind the States. This principle has been confirmed as recently as last fall, when the Federal Court held that Sovereign Immunity prevents the University of California Los Angeles (UCLA) from being sued for copyright infringement.
In any event, it can be expected that the Provincial governments would seek judicial review of the decision. Indeed, it may be even argued that they ought to do so, especially in a case like this one which involves an annual transfer of potentially millions of dollars of taxpayers’ money to Access Copyright. The legal basis for such non-trivial transfers should be resolved by the courts (which the Copyright Board is not) before the money can be transferred.
Moreover, even if the Copyright Act does bind the Crown generally, there could be other constitutional hurdles preventing the approval of the Proposed Tariff, especially in light of the recent Supreme Court decision in Reference re Securities Act. For example, it is far from being clear that Federal jurisdiction over copyright under s. 91(23) of the Constitution Act, 1867 extends to the imposition of mandatory tariffs by the Copyright Board, let alone to the imposition of such tariffs on another branch of government, namely the Provinces.