20 March 2025

Copyright protection affords owners an exclusive right to exploit works, or licence the right to exploitation thereof, in whichever manner they may choose (provided moral rights are respected).

With these rights being exclusive in nature, copyright licencing is largely subject to the whims of the owner and, in turn, without a suitable licence, a third party would be exposed to copyright infringement claims if any use was made of the works in question.

It naturally follows that a copyright owner may refuse the granting of a licence on any grounds… or does it?

In this article, we will explore the possible limitations that the compulsory licence provisions embodied in the South African Copyright Act 98 of 1978 (“the Copyright Act”) could impose on copyright owners in certain circumstances.

South African legal framework

As a point of departure, it is useful to consider the provisions of our law insofar as compulsory licences are concerned.

The Copyright Act provides that the copyright in any work is not infringed if the Copyright Tribunal (established by chapter 3 and sections 29 to 36 of the Copyright Act) (“the Tribunal”) grants a compulsory licence to do an act in relation to such work and the act is done pursuant to such a compulsory licence. The Tribunal is empowered to grant a licence in respect of any type of work and will do so where the refusal to grant a licence by the copyright holder is unreasonable.

The Copyright Act makes it clear that the Tribunal is empowered to grant licences in two types of situations, firstly where a licence is sought in terms of a licence scheme operated by a licencing body or other persons from whom licences are required, either by an individual or by an organisation claiming to be representative of a group of persons to which the scheme relates, or, secondly, where a person claims that he requires a licence in a case not covered by a licencing scheme. This article focuses on the latter.

An example of where a statutory (compulsory) licence was granted (albeit under the provisions of section 28 of the predecessor to the current Copyright Act) is The Johannesburg Operatic & Dramatic Society v Music Theatre International And Others^[1] (“Johannesburg Operatic & Dramatic Society case”). The Tribunal, in that instance, was tasked with determining whether it should grant a statutory licence where the authors refused (or their agents failed to procure) a licence. This raised three pertinent issues, namely:

(i)       whether the refusal of a licence constituted the “unreasonable withholding of the licence”;

• whether, even if it did constitute an unreasonable withholding of the licence, the Copyright Tribunal should, in the circumstances of the case, grant the statutory licence; and
• whether, even if the Copyright Tribunal did award the applicant a statutory licence, it had the power to make such a licence an “exclusive licence”.

In determining the issues, the Tribunal held that it was not merely a question of whether the author’s attitude was unreasonable, but rather that all surrounding circumstances should be taken into account.

By way of a short summary of the facts, the Dramatic Society alleged an unreasonable refusal by the copyright owners of three musical dramas, all participants in a boycott against performing the works before racially segregated audiences (during the Apartheid era in South Africa) and requested the so-called compulsory licenses. The copyright owners, answered, in addition to arguments based on technical aspects of the Act and on the competence and ability of the Dramatic Society, that they “are unwilling to have the said musicals performed before racially segregated audiences”. The Copyright Tribunal found for the Dramatic Society.

A modern commercial case study

A recent South African High Court case saw one of four co-authors of a range of mathematics textbooks launch copyright infringement proceedings against his co-authors and the publisher of the textbooks (and related materials). One co-author, who was responsible for most of the content that made up the textbooks and related materials  expressed his intention not to extend the licence period beyond what the parties agreed to (i.e. February 2024) and subsequently instituted copyright infringement proceedings in early November 2023 before termination of the licence agreement after he had written a demand to the co-authors and publisher calling for an undertaking that they would cease sales and distribution of all relevant textbooks and materials from 1 March 2024 onwards.

In response to the infringement proceedings that had been instituted, the other co-authors and publisher formally requested an extension of the licence term in respect of the agreement that had been in place between them for about 8 years at that time. They also advised that they would apply for a compulsory licence if consent was unreasonably refused.

Consent was refused and the publisher continued selling the relevant textbooks and related materials. In order to deal with the threat of the ongoing copyright infringement proceedings that had been instituted, the co-authors and publisher applied for a formal stay of proceedings (“the stay application”) and, subsequently, also filed an application before the Tribunal for the granting of the compulsory licence it sought. While they were in the process of creating replacement materials, they required more time to finish the process and sought a limited extension of the licence until the materials had been completed or 31 December 2025, whichever was earlier.

To provide some context, the publisher confirmed in its pleadings that, although difficult to estimate the exact number of schools that would be affected, roughly 500 schools use the relevant publications across the country. It further alleged that the commercial reality was such that most schools in South Africa could not afford to buy new textbooks and materials every year, and most do so on a three to five year cycle. The publisher also alleged that no comparable and affordable replacement materials were available for the schools to work with. The plaintiff’s own publications could be used, but at a not insubstantial increase in price.

The stay application was heard before Acting Judge Myburgh in the High Court of South Africa (Gauteng Division, Johannesburg) on 22 July 2024 and judgement was handed down on 1 November 2024.

In granting the stay of proceedings, the Myburgh AJ dealt briefly, on a prima facie level, with the merits of the compulsory licence application. He expressed the following obiter views that the refusal of the licence sought could be considered unreasonable by the Tribunal for the following reasons:

• it was common cause on the papers that the works in question were purchased or prescribed by educational authorities and thus that educational authorities and learners stood to be affected by the granting of an interdict (refusal of extension of the licence);
• curriculums had been planned with prescribed reading materials years in advance with the result that they could not, in the ordinary course, make such a big change without adequate notice;
• basic education is an entrenched right in terms of section 29 of the Constitution and the vast majority of learners in the affected grades would be children;
• the effect of one co-author’s refusal to extend the licence would have the effect of denying his co-authors the fruits of their labours; and
• persons other than the co-authors would also stand to be adversely affected (as alluded to above).

It remains to be seen whether the Tribunal will share similar sentiments to Myburgh AJ and grant the compulsory licence that is being sought. The compulsory licence application is set down to be heard by the Tribunal late in February 2025. It will be the first of its kind, considering it is a private commercial matter (not a case where a licence is sought in terms of a licence scheme operated by a licencing body).

Keep an eye out for part 2 to this article which will follow with a summary of the Tribunal’s judgement.

This article first appeared in WTR Daily, part of World Trademark Review, in (February 2025). For further information, please go to www.worldtrademarkreview.com.

[1]          Prentice-Hall Weekly Legal Service 1969 (1) 69 (M.20).