Copyright (Parallel Importing of Films) Amendment Bill — Third ReadingText is incorporated into the Bound VolumeCopyright (Parallel Importing of Films) Amendment Bill — Third Reading[Sitting date: 15 October 2013. Volume:694;Page:13877. Text is incorporated into the Bound Volume.]Copyright (Parallel Importing of Films) Amendment BillThird ReadingHon CRAIG FOSS (Minister of Commerce): I moveThat the Copyright (Parallel Importing of Films) Amendment Bill be now read a third time. The bill proposes to amend the Copyright Act 1994 by reinstating the ban on parallel importation of films for commercial purposes. The original ban came into force in 2003 to support New Zealand cinemas in the final stages of the transition to digital screening technology. The bill reduces the period of the ban which will come into force from 31 October 2013 from 9 to 5 months. This reduction reflects the changes in film distribution practices recognising that New Zealanders now often receive films at the same time as international viewers.The bill also imposes a sunset clause so that the ban will expire in 3 years on 31 October 2016. The 3-year time frame will give cinemas that have not yet converted enough time to transition to digital screening technology and to develop their film distribution model to reflect changes in the market for films particularly online. Many films are released on DVD between 3 and 4 months after their cinematic debut. The 5-month ban will effectively give cinemas a further 1 or 2 months to exclusively screen films without competition. This shortened period will allow retailers to parallel import copies of films earlier and encourage authorised distributors to provide consumers with earlier access to films. The ban does not prevent a person from importing a film for personal use.The Government strongly supports the transition to digital screening as it reduces the need for delays in film screening giving consumers earlier access to films. In its report the Commerce Committee noted that the ban allows cinemas flexibility in scheduling films particularly for school holiday audiences creating better financial viability and enabling more movies to be available at the times wanted by consumers. I also acknowledge the select committee’s comments that as consumer viewing technology develops it expects that this will force cinemas to develop new revenue streams to meet consumers’ expectations rather than rely on past business models. I would like to thank the Commerce Committee for its timely consideration of this bill and those individuals and organisations who made submissions on the bill. I commend this bill to the House.CLARE CURRAN (Labour—Dunedin South): Labour members have made it very clear in our speeches on this bill the Copyright (Parallel Importing of Films) Amendment Bill that we are reluctant supporters of this measure. We have qualified support for the 5-month delay which rests purely on the impact of parallel importing on provincial and rural cinemas which have less capacity to show multiple high-grossing movies simultaneously and less flexibility and ability to cut costs to remain competitive. We believe that the industry should have changed by now and should have caught upwith new technology but we do acknowledge that those cinemas that are in New Zealand’s provincial and rural communities are important and that the Government and Parliament should support their role. That is really the only reason we have for supporting this bill and we certainly have made it—The ASSISTANT SPEAKER (Lindsay Tisch): Sorry to interrupt the honourable member. The time has come for me to leave the Chair for the dinner break.Sitting suspended from 6 p.m. to 7.30 p.m.CLARE CURRAN: Where I was at was making it very clear that Labour’s support for this bill is very conditional. Our reasoning was purely around the qualified support for the 5-month delay in parallel importing which rested on the impact on provincial and rural cinemas. We have made it very clear that we will not support another go by this industry coming before a select committee to ask for another extension on parallel importing. I am very keen to ensure that that is reinforced from the other side of the House as this bill has come out of the Commerce Committee.What lies behind this bill is a much bigger issue. It is an issue about our copyright regime in New Zealand and an issue around intellectual property. Unfortunately this bill could not be considered within the context of that wider discussion as it should have been because the Government has reneged on a commitment it made to undertake a wide-ranging review of the copyright regime in 2013. Instead it has put that on hold. As we now know the reason for that is the Trans-Pacific Partnership negotiations—that has been revealed and it has been acknowledged by the Minister of Commerce under questioning. So I want to talk a little bit about that because where this bill should have sat around parallel importing generally should have been within the context of a wider review.There are a number of concerns that Labour has around the intellectual property provisions that are potentially in Trans-Pacific Partnership negotiations which as yet we do not know the detail of because the Government has not been transparent about discussing that with other parties and with the public of New Zealand in general. You do not have to release the text in order to have the discussion and unfortunately we are not able to have the discussion and all we can do is suppose based on earlier leaked versions of that text. One of our concerns is that there may be being proposed in those negotiations an increased regime of parallel importing generally. What we want to do is make sure that that does not happen that there is a commitment from the other side of the House to back up the discussions and the outcome of the select committee process and that that is not what is being planned.I want to touch on a few of the other potential things that may be around in that copyright regime in the Trans-Pacific Partnership negotiations and one of them is the potential extension of the duration of copyright by 20 years to 70 years—70 years; yes that is right—depending on the type of work and the date it was published. It has also been suggested that this could also result in the expansion of the regulatory regime under which internet service providers must assist rights holders in enforcing copyright online which would pull New Zealand into line with the United States’ Digital Millennium Copyright Act which we would see as being a backward step rather than a forward step in terms of promoting innovation in New Zealand.We may also be seeing a new criminal offence for the act of circumventing a technological protection measure or a digital lock which means that people who have legitimately bought DVDs in other countries and brought them back to New Zealand and are unable to watch them because they have been locked into that region are not able to find ways to be able to watch them which they can do. There could bestrengthened laws in that area that would ultimately disadvantage consumers in New Zealand.Another proposal might require New Zealand to afford rights holders an exclusive right over temporary electronic copies which could mean changing the provisions in our Copyright Act that carve out the liability for transient reproductions of copyrighted works as part of the normal technological processes. All these issues are very important. They actually do impinge on the ability of artists to go about their work especially in an online environment. But it is also the impact on innovation and our ability to control our own intellectual property regime that is extremely important.Our concern is that we are not going to see an aggressive and heavy-handed copyright regime in New Zealand. It is extremely important that we have a balanced and wide-ranging discussion as a community rather than having those things imposed on us which is why the transparency around the negotiations in the Trans-Pacific Partnership negotiations is so important—so that the community can have that discussion and so that there can be discussions in the political environment around what is actually being proposed rather than supposition. This has the potential to harm the way that New Zealand artists and innovative companies work and operate and use the internet to connect with overseas markets. The extension of a copyright duration internet termination as a penalty making it illegal to bypass technological protection measures as I said and restricting parallel imports into other areas so that New Zealanders would lose access to many overseas works and be forced to pay more potentially for books CDs and DVDs than the rest of the world would actually be a backward step. It would be clearly a backward step for us. The most important thing is for us to be able to have the discussion about it.We believe that excessive copyright durations could also potentially affect libraries from making backups and format-shifting works which could result in a tangible loss of shared heritage. So I think you might see that although Labour has very qualified support for this bill which gives an extra 3 years for very limited amounts of parallel importing for this particular issue this has to be the end of it. We have to be able to move forward. We have to be able to promote innovation and an online environment generally that is a progressive environment for copyright and for having that discussion in New Zealand because if we do not we are simply going to be going backwards.JONATHAN YOUNG (National—New Plymouth): I am very pleased to stand and speak at this third reading of the Copyright (Parallel Importing of Films) Amendment Bill. I think the previous speaker Clare Curran did touch on the general sentiment of the Commerce Committee which felt that this next 3-year period is vital for the parts of the industry that have not transitioned to make that transition.We know that in 2003 when this provision was first introduced by the then Labour Government and then when it was extended in 2008 the cost of transition back in those times was exceedingly high. Of course the digital cost these days is reducing all the time. Even though many submitters said to us that it is $100000 per screen to transition from 35 millimetre projection to digital projection we know that most of those theatres in the metropolitan areas have already done this. So in a sense this is a bill for small town New Zealand. It keeps those entertainment industries going while they are able to afford the transition.I think because of that it is a good bill to do. It extends the ban for another 3 years but instead of 9 months where the parallel importation of a film for commercial sale is banned it brings it down to a 5-month period of time. It is a temporary ban for the next 3 years. I guess if New Zealanders want to get something that is hot off the press they can do a number of things—maybe purchase it from Amazon.com or they can even goto a home video rental agency that has paid a licence fee to the importers and distributors and get movies there as well.Kris Faafoi: It’s a video shop.JONATHAN YOUNG: The video shop that is right.National Labour and the Greens had a very interesting debate through this bill. Simple as it is it raised a number of very interesting aspects regarding the market place. I think we are in the right spot for it. I think that the industry out there will appreciate the extension of this temporary ban for another 3 years. Once again as the commentary says and other speakers have said it is imperative that the transition takes place within these next 3 years. Thank you. I am very happy to commend this bill to the House.Dr DAVID CLARK (Labour—Dunedin North): I rise to express Labour’s support for this bill the Copyright (Parallel Importing of Films) Amendment Bill. It is a bill that as the previous speaker Jonathan Young has said weighs up the various factors at play and comes down with a compromised solution of having a shorter period until this effective subsidy passes.We on this side of the House and the National Party opposite had some robust conversations in the Commerce Committee. Many of us played devil’s advocate at different times and took different sides of the debate. It was a good select committee discussion. It was well chaired and I say to the member Jonathan Young over there who chaired it that he chaired the discussion well.We had some interesting conversations. We expanded our own knowledge of the sector. We had advice from officials on many things. We considered factors like the seasonal factors and how when a film turns up it is released generally at school holiday times and how those differ between here and overseas where the majority of films come from. We talked about competition with other films from similar genres and how that affects the timing of the release of a film. We talked about the availability of advertising such as billboards and the like which can create pressure on certain times to screen. We talked about the profitability or otherwise of some of the cinemas that have to make the transition to digital over time.All of the issues were weighed up and on balance the 120 cinemas roughly in New Zealand were given the benefit of the doubt in terms of allowing them a little more time to make the transitional arrangements necessary. But as previous speakers have said we do expect this to be the final transition. We expect this 5-month delay period to be where it ends and thereafter these things will be released at the same time.This bill expires on 31 October 2016. Labour gives its qualified support for the 5-month delay on the basis of the impact on provincial and rural cinemas which have less capacity to show those high-grossing movies simultaneously which is what is required to be competitive in the market place because we are concerned about what is going on in rural New Zealand. The Labour Party of course thinks that there are other ways that this problem could be tackled. Certainly higher wages in the regions would go a long way towards making this kind of transition affordable and to making those cinemas profitable as people would then have the ability to go out and enjoy the kind of entertainment that some of us think ought to be taken for granted—that people could go out and enjoy a movie or take the kids to a movie occasionally. Well unfortunately there are many families in New Zealand for whom that is no longer a reality. That is in part because these films are shown at a cost that is prohibitive but of course the reason the cost is prohibitive is that wages are low and families in the regions do not have enough to make ends meet. That means that people are struggling and consequently those who provide the entertainment to those people are struggling also. So this bill strikes a balance in the meantime.We would like to see the Government have a fuller response to the economic issues facing New Zealand instead of having a two-speed economy where Auckland is running away and the rest of New Zealand is struggling and where economic growth is really lagging behind what it ought to be in a time when we have had such high dairy prices internationally. Our trade terms should have been better. This Government has underperformed in the economic sector and regional New Zealand is hurting. One of the ways we are seeing it expressed is here in this bill where people are not able to afford to go to the cinemas to support those community facilities which we on this side of the House value.I am pleased that the discussion was good in the Commerce Committee I am pleased with where the bill has got to and I think the industry will be pleased with the additional time. I think from the tone of the conversations and debates that have been had in this House that the industry will realise that this is the last extension and we will not be talking any more about my colleague KrisFaafoi’s fascination with the movieThe Smurfs and the Magic Flute again if luck is on our side. This third reading—Kris Faafoi: Academy Award - winning performance from Papa Smurf.Dr DAVID CLARK: —will be the last opportunity to discuss as my colleague says the Academy Award - winning performance from Papa Smurf. We did actually discuss in the Commerce Committee the release time of the Smurfs movie.The Smurfs 2 was one of these high-grossing movies so it actually came up as a topic that we discussed around the table and how that as a concrete example plays out when this legislation goes through. Mr Faafoi admitted in an earlier speech though that the first movie he ever went to see wasThe Smurfs. It sounds like he was a bit of a fan as a younger man. I am sure he will say more when his time comes to speak on the bill and I hope that is where his contribution stops. I may be inviting a contribution I welcome less if I pursue this line much further.For Labour we are happy to support the bill. We are happy that it is a temporary measure and we want to see these community facilities preserved but we also think that the bigger issues in the economy need to be addressed. This Government needs to look out for jobs and for higher wages so that people can actually afford to take their kids to the movies. Those simple things need to be addressed. This Government needs to get on top of the economy rebalance it where it is failing and focus on the issue that matters to New Zealanders—that is jobs.GARETH HUGHES (Green): Kia ora.Ngā mihi nui ki a koutou. Kia ora. I rise to speak on the Copyright (Parallel Importing of Films) Amendment Bill. It is with some dismay and shock that I find myself the only member in this Parliament rising to stand up for competition. I find that deeply ironic. Both the National and Labour parties the neo-liberal free-market parties are the ones supporting a statutory monopoly for content rights holders. I find it staggering that it is the Green Party standing up for competition new industries new jobs and new innovation. It is not always that the Greens are in this position but I will relish it.It comes as no surprise that the Greens are opposing this bill despite loving our regional theatres and despite loving films. I do not know whether I am embarrassed or not but the last film I saw was I thinkRiddick the third in thePitch Black series which was pretty cool.Kris Faafoi: Tell us more.GARETH HUGHES: I will not tell you any more because I would rather talk about the substance of the bill. What this bill does basically is it reinstates the ban on the parallel importing of films reduces the period from 9 months to 5 months and gives a 3-year extension. The Greens are voting against this because we do not believe that one industry deserves a statutory monopoly that is going to drive out competition and driveout competing content delivery systems to protect one business model. It is a business model that we should point out has had a 10-year transition period to date—a 10-year transition period. If 10 years is not enough where is the evidence that 3 years is going to be enough?I am going to talk a little bit about the process a little bit about our opposition and a little bit more about our solutions. Firstly and I think it is important to note this bill landed in Parliament under urgency. There was no reason why this bill had to come in under urgency. Of course we have had a 10-year warning period before this ban on the parallel importing of films was expiring. We think it is unacceptable that bills like this should be introduced under urgency. The Green Party abstained from voting because there just was not enough information in front of us. We had a letter from Minister Foss arrive on our caucus table that day. So we abstained.We went into the select committee period with an open mind. We talked to the submitters obviously. We talked to the movie industry outside of the select committee process to gauge its opinions. And we have come to a clear conclusion that the Green Party cannot support this bill. I think it is disappointing that the Labour Party is supporting it given that in its minority report it said that the losers of this law are the film retailers and the public who are unable to exercise choice during the period of the ban. That is from the Labour Party. So it is a bit disappointing that it did not go the further step.I would like to thank the chair of the Commerce Committee the member Jonathan Young. I would like to thank all the members on the committee and all the submitters. I think two submissions stood out for me in particular. The first was Consumer New Zealand which said that the ban should lapse entirely this year—not in 3 years; this year. I would also like to note that the Creative Freedom Foundation said that the consequences of this bill are that we are going to see greater copyright infringement. The members in the old parties might call it piracy; I would call it copyright infringement because it is not actually a criminal—Tracey Martin: Really?GARETH HUGHES: No it is not under the criminal statute actually; it is a civil offence. That is why I call it copyright infringement. Again it is deeply ironic. Here is the Green Party standing up to stop copyright infringement. We hear some of the old parties standing up and yelling from the rooftops after being lobbied by the rights holders that we need to crack down on piracy. We all remember theSkynet debate. But here is the Green Party standing up for artists standing up for people and sending a message. What we need is legal content delivered through new online means new content delivery systems. We do not support copyright infringement; what we support is a sane copyright approach a new debate. So here we are in the deeply ironic situation that it is the Green Party standing up for competition and it is the Green Party standing up and saying no to copyright infringement.The root of our opposition to this bill is that we can see no justification and we heard no reason why this one particular industry needs a statutory monopoly. This is an incredibly powerful tool our Parliament has. Most of it was scratched from 1984 to 1992 onwards when we went through that big transformation in New Zealand the neo-liberal revolution. Many of those statutory monopolies—things like bans on margarine to protect the butter industry—were abolished during that period. So we do not find it compelling that this one particular industry needs a statutory monopoly to block out competitors in order to provide its content.What we see in the regulatory impact statement is that the Government’s own officials are opposed to the bill. What we see yet again is another special deal for the Government’s mates. We have seen it with Warner Bros we have seen it with Skycityand we have seen it with RioTinto which had the Government over a barrel. There are numerous examples from the oil companies to the casinos. Again we are seeing special deals for the Government’s mates.What we see in this legislation is very much a temporarybandaid. That is what the Labour Party is arguing—that it is a compromise that it has hammered out that it has negotiated and that it is a temporarybandaid. Ten years’ transition was not enough so we need just another 3 years. What we have to ask is if the industry cannot do it in 10 years how is it going to do it in 3 years?There are two justifications that both parties and submitters raised one of which is the school holiday season need for cinemas to be able to have a statutory monopoly—a ban on parallel importing to protect the holiday season films. The fact is that both parties acknowledge that this is going to expire in 3 years. I ask the other parties what is going to be different in 3 years. We are still yet to hear an answer.The other reason is that the industry needs more time to continue the digital switch-over. The fact is that it has had 10 years. Is it going to come back in another 3 years asking for more time to complete the digital switch-over? In saying that I want to reaffirm the Green Party’s commitment to and support for regional cinemas. We love cinemas but we think cinemas should be able to trade on their merits on their services and on the great atmosphere they provide not on a statutory monopoly in law. We think that is an incredible power that Parliament alone has in our country and one that should not be used unwisely. Unlike the member David Clark I think gee if we want to support Kiwi families I would rather see kids having breakfast. I would rather see kids and families pay less for their electricity bills not for cinema tickets. We have got to think about the important things facing Kiwiwhānaus.I want to say that this bill also stifles cultural participation. The disability community has come out asking why it should have to go to cinemas to see content when it comes out. I love cinemas but many Kiwis do not find the cinema experience appealing. They do not want the sticky seats and the popcorn on the floor and to be crowded in a room; they want to consume content in different ways.The last point I want to make is that what this bill does is look at copyright in isolation. It is vitally important that our Parliament grapples with this very interesting policy debate. It is something that is causing big waves around the world. We saw the European Union throw out the Anti-Counterfeiting Trade Agreement treaty. We have seen the Stop Online Piracy Act and the Protect IP Act thrown out of the Congress and the Senate in the States. We have seen Australia we have seen the UK and we have seen America do copyright reviews. What we hear from the Government is that we have to put aside our much-anticipated copyright review because of the Trans-Pacific Partnership agreement. The fact is that other partnership countries are undertaking copyright reviews. There is no reason why we should not be having a fundamental discussion of what copyright means in the internet age because our Copyright Act was written very much in a pre-internet age.I would like to reference a recent London School of Economics report. Again I find it odd that I am the only member to talk about London School of Economics reports when it comes to copyright. The fact is that what this report very clearly states is that the claims made by rights holders are overstated and are built on faulty data. It also states that the most successful way we can support artists and rights holders is not these punitive approaches that use the might of the State through laws to ban content or crack down and disable people’s internet connections; the best way we can support artists and rights holders is to empower them to have new ways to deliver their content affordably and legally and to give people choices. That is why the Greens are opposed to this bill. We want to see new jobs created. We do not want to protect just one sector. If you candeliver content online or through other means we want to support you. We want to give you a fair go a level playing field. If you can compete based on your services your quality you should be able to do it. It should not be the might of the State cracking down on you.The fact is that if the digitisation reason is the big driver for why the industry needs 3 extra years I think the most effective transparent way that this Parliament and this Government could support the digital transition is actually cash support—maybe financing support. We have seen it in other sectors of the economy. If it is that dire the industry should be asking for transparent support mechanisms that do not disadvantage other industries other competitors. But it is the Greens you know who are standing up for sensible copyright reform competition jobs and a fair go for all New Zealand companies. Kia ora.KANWALJIT SINGH BAKSHI (National): First of all I would like to congratulate you Mr Assistant Speaker Robertson on your election to the local board.It is my pleasure to stand in the third reading of the Copyright (Parallel Importing of Films) Amendment Bill. I think we will all agree that it is a pragmatic and sensible piece of legislation and the Minister in charge of the bill the Hon Craig Foss needs to be congratulated on his commendable effort.The film industry is in the middle of a large-scale makeover as members across the country convert to digital exhibition technology. The conversion is well under way and is expected to be completed within the next 2 or 3 years. The previous speaker Gareth Hughes was saying that we need to create jobs. If we do not support this industry then we are going to lose jobs and stop development in this industry. I think it is in the DNA of the Green Party that it has to oppose everything that the Government wants to do.I think this is a good bill. I commend it to the House.TRACEY MARTIN (NZ First): Kia ora Mr Assistant Speaker. I rise to provide New Zealand First’s contribution on the Copyright (Parallel Importing of Films) Amendment Bill. New Zealand First will be supporting this bill. I found it incredibly interesting listening to the Labour Party contribution by the member Clare Curran and also to the Green Party contribution by Mr Gareth Hughes. Ms Curran’s contribution somehow suggested that these New Zealanders these cinema owners are ripping off New Zealanders that these New Zealanders who are running businesses with New Zealand employees are somehow ripping off New Zealand by asking for the continuation—a short continuation—of a delayed release protection. That is what they are asking for. That is all they are asking for.I find it fascinating that Mr Hughes calls this a statutory monopoly. A statutory monopoly is what he calls this. I have to remind Mr Hughes—and apparently he was on the Commerce Committee so I would have thought he would know—that the DVD companies that have the right to release these DVDs and therefore sell them also get protection. The pay-per-view channels cannot play any of these movies for a period of time after the cinema release. Pay television cannot play these films for 9 to 12 months after the DVD people have got them and free-to-air cannot play them for 12 to 24 months after the DVD people have got them. So it is not a statutory monopoly at all that these poor little rural cinemas employing good honest hard-working New Zealanders in particularly difficult financial times are seeking from their Government and from their Parliament; they are seeking a little bit more time to step up into the digital age. I do not think that is a statutory monopoly; I think that is New Zealanders asking from their elected representatives the protections that they should have and the consideration that their Government should give them when it talks about New Zealanders’ jobs. That is what I would say.These two members also appear to have forgotten the other part of the conversation which is actually about the ability for New Zealand films to be shown. There is a whole area of film production behind this conversation. There needs to be a window in which rural cinemas and New Zealand cinemas can show New Zealand - made films. If New Zealand - made films have to go straight to DVD without any of the coverage that they can get from being shown inside mainstream cinemas they will lose money and that industry will fold. Let us just have a talk about how much money that industry brings in shall we? A 2012 report by New Zealand’s leading financial services firm PricewaterhouseCoopersEconomic contribution of the New Zealand film and television industryindicates that the industry generated more than $3.23 billion in revenue in 2011.I do not want to take too long because this bill is going to pass—it needs to pass—but some common sense needed to be put into the conversation quite frankly. When the Labour Party starts using the word “choice” you need to worry New Zealand because that word has traditionally belonged to the right. What we have got now is Ms Curran standing up and we have got the Green Party standing up and talking about how New Zealanders should have choice—New Zealanders should have choice. Damn the sales. Damn the New Zealanders being employed. This is about choice. I think New Zealand needs to think very carefully in 2014 about which party it really needs to put into power in this House—the party that truly stands up for New Zealanders and the one that puts New Zealanders first in every piece of legislation. New Zealand First will vote for this legislation.The ASSISTANT SPEAKER (H V Ross Robertson): I call the honourable member Jian Yang. Nihao ma.Dr JIAN YANG (National): Very good.Xiexie. I am pleased to rise to take a brief call on the Copyright (Parallel Importing of Films) Amendment Bill. This bill imposes a temporary ban on the parallel importation of films for commercial purposes for 5 months from the date of the film’s first release to the public. The purpose of the ban is to give cinemas more time to convert to digital exhibition technology. The ban allows cinemas flexibility in scheduling films particularly for school holiday audiences creating better financial viability which enables more movies to be available at times when wanted by consumers. This position has general support from other parties and within the sector.I do not go to cinemas very often—I wish I could—but I normally would find some time during the school holidays to watch one or two movies with my children. I believe that many parents do the same thing.Over 60 percent of cinemas have now converted to digital exhibition technology so this temporary ban a 5-month ban will give an opportunity for the rest of the cinemas to complete the conversion. I commend the bill to the House. Thank you.The ASSISTANT SPEAKER (H V Ross Robertson): I call the honourable member Kris Faafoi—The Smurfs 2.KRIS FAAFOI (Labour—Mana):Talohani Mr Assistant Speaker. Just to correct you—I am not sure whether I am allowed to do that under the Standing Orders—but it was notThe Smurfs 2 that was my first movie; it was actuallyThe Smurfs and the Magic Flute which was released around the early 1980s. Now that David Clark has finished his speeches during this debate I am glad that that record will be over and that my name will not be associated with that movie any more.I do want to point out that from time to time as MPs as we debate issues in minutiae in the select committees and here in this House we kind of lose track of what this actually means to the average punter. We are talking about the movies here. When a movie is released in the cinema what we have had in the past is a delay period. I do notlike to call it a ban; I like to call it a grace period during which the company that is distributing that movie can have 9 months’ grace where it can sell DVDs—the likes of the very good New Zealand - made movieMt. Zion—and have the period where it can make profits off selling the DVDs at full price. After that 9-month period anyone else can parallel import that movie in if they want to. Obviously that is usually 9 months after the cinematic release. Usually you then see the movies that 9 months ago were selling for $40 in the basement bargain bin selling for about $10. That is what we are talking about here—that process.This bill the Copyright (Parallel Importing of Films) Amendment Bill will change that process. It is in legislation that that grace period is there. This bill will extend that grace period for 3 more years but reduce the grace period for parallel imports to 5 months. As we have said on this side of the House the Labour Party will be supporting that more or less for the specific reason to support the likes of smaller cinema operators in rural and regional areas—Hon Shane Jones: LikeKaitāia.KRIS FAAFOI: The likes ofKaitāia. Although I have not been to the movies inKaitāia we are wanting to support this bill to support the likes of those cinemas.I do actually have to agree with some of what the New Zealand First member Tracey Martin said. We do actually want to protect the jobs of the people who are working in those smaller cinemas. I understand that during the select committee process a figure of around 160 jobs in those smaller cinemas was mentioned or raised. Certainly the benefit of those cinemas to be able to change their technology and to support those businesses in those smaller areas is the reason that the Labour Party continues to support this grace period being extended. We do not however believe it should be extended for 3 years. It is 2016 I believe. I am looking at the chair of the Commerce Committee. He is saying that yes it is extended to the end of 2016. We believe that 2 years is enough for those cinemas to make the transition from the old 35 millimetre technology to the digital technology which of course another member Kanwaljit Singh Bakshi mentioned is in roughly around 60 percent of the cinemas around the country.We also believe that the decreasing of the grace period from 9 months to 5 months should send a pretty clear signal to the cinema industry that this is the last chance saloon. If they do not start transitioning to the digital technology they will not get another chance of extending the legislation that was passed in 2003. Labour will not support any further extension of this legislation beyond 2016 and as I would like to reiterate we actually think it should end at the end of 2015.I do want to make the point to the member from the Greens Gareth Hughes that if he would like to come and have a look around the Light House Cinema inPāuatahanui one of the cinemas that we are concerned about and listen to some of the concerns that those cinema operators have they do very much appreciate the fact that we are able to give those smaller operators some more time to switch to the digital technology.Hon Shane Jones: And Gisborne.KRIS FAAFOI: And the likes of Gisborne because it is those smaller cinemas that will be hurt if this grace period were to end on 31 October this year. The likes of the Light House Cinema—I went to the Light House Cinema inPētone recently to watch a great New Zealand movie—Mr Pip. Certainly I think that cinema had transitioned. So a number of those smallerarthouse cinemas are transitioning but we need to make sure we give them just a little bit more time to be able to make the switch over to the digital technology.A lot has been spoken in this debate about the movie experience and it certainly has changed over time. The Hon Shane Jones may have been to the cinema when thenational anthem was played before the beginning of the movie and the movie theatre was the only place to watch that movie. But having said that times have changed and technology has changed. Mark Mitchell may have watched a movie in the cinema and then later on maybe 3 or 6 months later—Hon Shane Jones: Yeah but he never got caught.KRIS FAAFOI: —that is a very good point—he could have rented that movie from the video shop as Mr Young mentioned before. But now technology has changed so much that when a movie is released internationally you can have it almost instantly. So that is why we believe that this piece of legislation should have a defined time frame. We believe that Kiwis should have access to that content if it is being released let us say in the States and if by some technology you are able to download it here in New Zealand instantly you should be able to do that.I am not sure whether I am about to break the Standing Orders but I would like to acknowledge the Hon Chris Tremain who has just walked into the House. I take my first opportunity to wish him all the best post this Parliament. I share a radio show with him. We call it “Ebony and Ivory”—Hon Shane Jones: Which one is which?KRIS FAAFOI: I will not make judgments on who is who. I just want to take this chance to wish you all the best post your parliamentary career as you are one of the members across the House who has been very pleasant to me and I wish you all the best in your business career which I am sure will be helped by the economic settings of the next Labour Government.As I draw to a conclusion as I begin my very long conclusion I say that this piece of legislation should be passed. There are concerns from the Green Party that it should not but we believe that in the interests of those smaller operators it should be extended but this should be the last time that it is extended. This is certainly the last time that the Labour Party will support this legislation because we believe that with the growing convergence of digital technology we consider that New Zealand should be a modern and connected society and we should be able to access the media or the movies at the same time as the rest of the world. We believe that is why just a 2-year extension should be put on this piece of legislation.We believe that the lack of legal methods to get this content if it is released overseas could lead to increasing the level of piracy out there so that people are actually illegally downloading movies where we should have the technology and the ability in terms of the data caps and ultra-fast broadband to make sure that New Zealanders can have access to this content as soon as we can. I think the Rev. Dr David Clark also mentioned that extending this period may also increase the price of going to the movies for the average Kiwi fan. We think that is a shame and certainly we hope that after that 2-year period when we scrap the 5-year grace period that certainly would make the cinema-going experience much cheaper—Jonathan Young: Three years.KRIS FAAFOI: —3 years sorry—Hon Shane Jones: More enjoyable.KRIS FAAFOI: —and more enjoyable for New Zealanders. It is also a challenge to the cinema industry to make sure that they are more innovative in terms of trying to attract people into their businesses.Our support is qualified. We do note that it is the 5-month grace period on parallel imports and not the 9-month grace period that was introduced in 2003. We believe that that is sending a strong message to the cinema industry that it should get shipshape or ship out. We do support this piece of legislation because of those regional and smaller cinemas in those areas. It will protect around 160 jobs. But we do hope that in 2016 thatwill be the end of it. We certainly will not be supporting any legislation that looks to extend that period.MARK MITCHELL (National—Rodney): I just want to comment on the contribution made by the Green Party member Gareth Hughes because it was a bit of a confusing contribution. He said that actually there was not anything illegal about what was happening. But if you go back and have a look at the Green Party minority view it clearly states: “We were also persuaded by arguments that the bill stifles cultural participation”—it would have been good to get an explanation around that—“and encourages illegal file sharing in the absence of legal alternatives.” So there was definitely a reference there to illegal file-sharing.This Copyright (Parallel Importing of Films) Amendment Bill is a very good bill. Our theatres do need a bit more time. It is not going to happen again. That has been made very clear. But they do need a bit more time to make the switch to digital. In Matakana in my own electorate the theatres are 66 percent digitised there—two of their three theatres are digitised. Who knows Mr Faafoi? If they ever getThe Smurfs and the Magic Flute in 3-D you can come up and enjoy the experience in Matakana. It is a very good bill. I commend it to the House.The ASSISTANT SPEAKER (H V Ross Robertson): I call the honourable member Iain Lees-Galloway. This is a full call Mr Lees-Galloway. It is not split.IAIN LEES-GALLOWAY (Labour—Palmerston North): A full call—excellent very good. The Copyright (Parallel Importing of Films) Amendment Bill is one of those challenging issues. I know there would have been a lot of conversation at the Commerce Committee. You have got really good arguments both for and against implementing this amendment bill to carry on with the ban on parallel importing of films for a period after they are released at the cinema.On the one hand there is the argument that actually the industry should have made the transition in the 10 years that it was given to make the transition to the business model of the digital world. That period is over and it is time for it to make the change. By not requiring the industry to make that change we are essentially diminishing choice for consumers and potentially unnecessarily increasing costs for consumers. On the other hand though the fact is that for many provincial cinemas in particular the cost of completing that transition has been prohibitive and they have asked for a little bit more time to be able to do that. Those provincial communities would be losing something very significant if their local cinema had to close down.Like the Government we are concerned that people are exiting the provinces at a tremendous rate. We are concerned that many New Zealanders are flooding over to Australia. There is this massive exodus of people out of the country as the economic opportunities in the regions have been stifled by the lack of a comprehensive programme of regional economic development from the Government. We share those concerns with them. We would not want there to be any other reason for people to leave the provinces and go to the major urban centres or even as we know they are doing leave the provinces to leave the country altogether and head over the Tasman to Australia and further afield.It is in the full knowledge of trying to achieve that sensible balance that Labour with reservations of course does support this bill. It was a Labour Government that originally passed the Copyright (Parallel Importation of Films and Onus of Proof) Amendment Act 2003 which was the original legislation that gave the industry that 10-year grace period in which to make the transition. It is because those provisions in that Act are set to expire very soon that this bill continues on with those provisions.We agree that as part of the agreement with the industry to carry on that transition period the ban delaying the importation of films has been reduced from 9 months downto 5 months. That will certainly assist with bringing those films on to the market in other formats and in ways that might be more accessible to people.I think my colleague David Clark actually touched on one of the issues that really is at the heart of this. What we are talking about is the cost of being able to access films which is part of the cost of living and the cost of things that we expect Kiwi families to be able to take for granted. Of course with the cost of living there is a balance to the equation. There are two sides to the equation. One is what things cost but the other is actually how much money people have and the resources people have to be able to meet the cost of living.What we have seen in recent years is the cost of living going up and up and up in a number of ways whether it be people’s power bills whether it be the cost of accommodation or whether it be the cost of fuel the cost of food the cost of clothing the cost of school books and shoes. The basics of life are going up and up and up but wages of course are not keeping up with that increase in costs.So although on the one hand we should be doing everything we can to keep the cost down of what is pretty basic entertainment and something that everybody growing up in and living in New Zealand should be able to take for granted—we should keep those costs down—we should also be looking at how we ensure people have the resources to be able to achieve and experience a basic standard of living in New Zealand. That of course requires decent wages. On this side of the House we have reservations about this legislation but we would also make sure that family pay packets were augmented by doing things like increasing the minimum wage to $15 an hour and supporting the living wage campaign. So in many ways this legislation is a balancing act.I take some issue with the Greens’ position. It is all very well to be able to take the purist view. A lot of what is behind the Greens’ argument is perfectly valid but they have got to actually look at what it means for people’s lives in a real sense. I encourage the Greens to get out of Wellington—get out of Wellington Central—and actually go and talk to some of the provinces and the provincial communities that would be impacted should we not pass this legislation. It is not ideal. We accept that it is not ideal but we have to think about the practicalities of the legislation that we pass and what things will mean in real terms for people. If we held the Green view which in the purest sense is an understandable view the fact is that cinemas in regional and provincial communities would close. It is as simple as that. So it is all very well to have an intellectual argument about these things but we have to think about the practicalities as well.There is growing concern that the kinds of bans on parallel importing that are included in this legislation may be something that we are going to see more and more of. I know that a lot of people in the community have concerns that that would come with the Trans-Pacific Partnership. Of course one of the big problems about trying to take a view on the Trans-Pacific Partnership is how little information we have received from the Government about what it is that it is negotiating and what that will look like. I understand and I know that what Government members would say is that in the past when Labour Governments have negotiated free-trade agreements they have not handed out all the details. But what we did do is take a more inclusive approach so we made sure that organisations like the New Zealand Council of Trade Unions and organisations like Greenpeace—Tim Macindoe: Valiant effort. Valiant effort.IAIN LEES-GALLOWAY: Sorry? I appreciate the words from the Government’s junior whip. We made sure that organisations like the Council of Trade Unions and Greenpeace were kept in the fold and had an understanding of the kinds of issues that were being dealt with during free-trade agreements.The Trans-Pacific Partnership is much more than a free-trade agreement. It goes well beyond simply talking about tariffs that are applied to commodities. I think the Government is probably experiencing so much resistance from the wider public because it has really taken that withholding of information to an extreme—to the point where people are starting to feel as though it is becoming quite an anti-democratic process and people are feeling locked out of the process. When you lock people out of the process there is a lack of understanding and there is fear of what that might mean.And certainly there is concern that the kind of ban on parallel importing that is part of this legislation will be applied to a range of other products where people enjoy the low prices that come with parallel importing—particularly I think of clothing and the basic necessities of life where the price has come down because we have had the ability to use parallel importing in New Zealand. There is fear out there in the community as to what the impact could be if such bans were included in a treaty that New Zealand signs up to.So we call on the Government to be a lot more transparent around its negotiations and to work with the public. We understand that the agreement could have a lot of benefits but it does carry a lot of risks as well so naturally there is fear out there in the community. The Government could handle this in a much more constructive and collaborative way with the public than it has been doing.To summarise the Labour Party does support this bill. Labour has significant reservations about it but it understands that this is necessary for rural and provincial and regional communities to be able to carry on with that basic right of being able to go out and have a family night at the movies. This is necessary but this is the final opportunity for the industry to make that transition that it needs to make and to start living in the digital world and the 21st century.TIM MACINDOE (National—Hamilton West): Thank you Mr Assistant Speaker Robertson and may I too congratulate you on your recent election to public office. You are a dedicated worker for the people of your community and I acknowledge you for that and I wish you well in your new role.We have had a very constructive debate on the Copyright (Parallel Importing of Films) Amendment Bill and I want to thank all the members who have contributed to it. We have had thoughtful contributions we have had some humorous asides and we have even had one or two surprising contributions not the least of which was the surprising audition I think I should say by the Green MP Gareth Hughes to become the new leader of the Ayn Rand Institute. I wish him well for that. I am sure it will be surprised to find him in its midst but politics keeps strange bedfellows and good luck to him for that.As I say it has been a good debate. I think it has reached a sensible compromise or solution to an issue that needed attention of this type and I am glad to lend my support to it.A party vote was called for on the questionThat the Copyright (Parallel Importing of Films) Amendment Bill be now read a third time.Ayes103New Zealand National 59; New Zealand Labour 33; New Zealand First 7;Māori Party 2; ACT New Zealand 1; United Future 1.Noes15Green Party 13; Mana 1; Independent: Horan.Bill read a third time.