TNAG-0086-FCO40-122-Copyright-legislation-1968 — Page 15

CONFIDENTIAL

Y

11.

To sum up. With the advent of broadcast television in Hong Kong and in a situation (not parallelked in the UK.) where the wired Rediffusion television service can compete as an originator of programmes with the broadcast television service, there is a strong case in the public interest for affording copyright protection to broadcast television and there may be a strong case for extending to the public the right to establish certain types of relay from communal aerials for the direct and better reception of broadcast television programmes. This is the case, as seen here, for "clipping Rediffusion's wings" and on which it would be necessary to rely when defending it in public. It would be appreciated if you would confirm that, as set out in paragraphs 9 10 above, it is a comprehensive and accurate statement of the arguments and state whether it is a fact that Rediffusion (Hong Kong) Ltd., will not adequately develop relay services from communal aerials. Any amendments or expansion you can suggest would be helpful.

12.

To turn now to the question of a possible claim by Rediffusion of inequitable treatment. On the extension of copyright protection to broadcast television, it appears that there cannot be any ground for claiming that the liong Kong Government is infringing rights already granted under the licence since (as noted in paragraph 5) the licence itself expressly declared that it was subject to any copyright which might exist in matter received by means of Rediffusion's broadcast receiving station. On the other hand, your intention to revoke the licence in the public interest and to grant a now one will involve the extinction of existing exclusive rights to erect some types of aerial systems. If the situation is correctly described in paragraphs 9 - 11 above, there can be no doubt about the clear public interest in your proceeding as you propose and it would seem that the Company were disposed to recognise this in stating (in their letter of 12 October 1967) "we respect the fact that the public interest requires special consideration under the circumstances likely to come about", even though they qualified this by the statement:

"In saying this, we do not wish it to he understood that any requirement of the public interest is ground for derogating from our Licence rights".

However, to the extent that the Company might be able to establish damage through the cxtinction of these exclusive rights or their exercise by others, it seems that it might have a case for compensation, notwithstanding that the rights are denied to it in the public interest and for reasons of public policy. In discussion with Mr. Hobley it was mentioned that the new licence might, in some respects, be more favourable to the Company than the present licence. If this is the case, there is perhaps a possibility that the issue of damages could be disposed of by concessions made in the course of negotiations about the terms of the new licence. It would seem preferable, in all the circumstances, to attempt to amend the licence by negotiation. You may have given further consideration to the question of damages which is discussed in paragraph 9 of Executive Council Memorandum XCC(68) and, if so, we would like to know your conclusions.

13. Finally, it is necessary to mention an aspect of this matter which might be raised or hinted at publicly, here or in Hong Kong, in the course of a determined campaign to oppose your proposals. It is understood that a member of the Executive Council (Mr. Clague) has a substantial interest in Hong Kong Television Broadcasts Limited, which stands to gain from the proposed legislation as it affects television broadcasts. We would be glad to have your confirmation that Mr. Clague took no part in the Council's deliberations on this issue in arriving at the advice they tendered.

CONFIDENTTAL

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