Contents: What is CD Duplication? What is the difference between a CD and a CD-R? Is the Canadian Government taxing blank CD-Rs? What other countries collect a levy like this? Is there a government website that explains this? What is the amount of the levy tax on CD-R media? How Can I Avoid the Levy? How can I avoid getting ripped off? How much money does the CPCC collect and what do they do with the money? Where can I go in Canada to get CD Duplication Services? Disclaimer     What is CD Duplication?     Duplication refers to a process of writing data or music to a recordable blank disc. This is typically carried out on a Computer that is equipped with a CD Writer (although there are standalone units that can duplicate CDs). Although Compact Discs were invented in the early 1980’s (and mass production began in the mid-80s), the technology to record compact discs did not emerge until 1990. The manufactured Compact Disc differs greatly from a Recordable CD (CD-R) – refer to the next section “What is the Difference Between a CD and a CD-R” for more details. Back to top     What is the Difference between a CD and a CD-R?     Although the discs may look very similar, there is a world of difference between a Recordable CD-R disc that has been burned, and a “Pressed” (or “Glass Mastered”) compact disc (CD) that has been manufactured. A pressed compact disc (CD) is manufactured with microscopic bumps (ON) and valleys (OFF) to represent the two digital letters of the digital alphabet. A Glass master is used to produce a piece of nickel that acts as the stamper for the CD (same applies to DVDs and even Bluray). Each manufactured CD would have a unique custom nickel stamper. The stamper has all of the hills and valleys of the Master CD on it, and is used to transfer the information to the finished disc in a molding process that molds plastic pellets (polycarbonate) to the finished product. To watch a video of the CD/DVD/Bluray molding process, click here.     Although these discs are all the same size and similar colour and shape as a CD-R, the underlying technology and manufacturing process differs tremendously. For a recordable disc, the digital letters ON (1) and OFF (0) are represented by holes that are shot through a layer of DYE on the CDR by a recording laser. The laser shoots this hole to represent an OFF (0) letter and leaves the DYE intact to represent an ON letter (1). This is why this process is refered to as “burning” a disc... i.e. the disc is actually being burned with holes by a laser in the photo-sensitive dye layer of the disc!     To recap: A “pressed” disc with music or video on it would be manufactured with the data imprinted right on the copies. A Recordable CD, DVD or Bluray disc is actually manufactured with a DYE that can be written to with a laser device. Before there were recordable discs, the original CD and DVD players were only able to PLAY discs and not WRITE to them. These players used lasers to read bumps and pits on the surface of the disc and convert the data stream to binary for a computer or a chip to translate into sounds, videos, images, etc.     Recordable CD , DVD and Blu-ray Drives have the added ability to burn holes in the DYE of a recordable disc, thereby allowing small scale production of CDs and DVDs. Back to top     Is the Canadian Government taxing blank CD-Rs?     In March of 1998, federal legislation provided for a levy to be collected on blank audio recording media. It is called a levy, as opposed to a tax, because it is not collected by any level of government. Rather, it is collected by a group representing the recording industry. In January 1999, the Copyright Board of Canada announced the creation of the Canadian Private Copying Collective (CPCC).     The Copyright Board decides on the amount of the levy and what media it applies to. The CPCC submits its proposed levies and the Copyright Board holds meetings and hearings to hear any objections to the proposed levy amounts. The levy is usually set for a fixed time period of approximately 2 years and revisited every couple of years.     The first time the Copyright Board set the levy was December 17, 1999. Back to top     What other countries collect a levy like this?     Most countries, including most G-7 and European Union members, have introduced comparable taxes with respect to the private copying of sound recordings. Canada is actually one of the last to do so. Back to top     Is there a government website that explains this?     The Copyright Board website can be found at http://www.cb-cda.gc.ca/. In this website, your will find additional information on the CPCC and the levy tax on CD-R in Canada. Back to top     What is the amount of the levy tax on CD-R media?     The current levy on CD-Rs is $0.29 each. You can check for updates on levies at www.cpcc.ca Back to top     How can I avoid the levy?     First and foremost, make sure you purchase your blank media from a reputable, registered retailer. A retailer that is registered with the CPCC can help guide you through the process and advise you accordingly. Also, a registered retailer will also submit regular reports to the CPCC and submit any levy payments in a timely matter. In Canada, you can contact Microforum. They are a registered, reputable retailer of blank recordable media that specializes in assisting companies with their blank media needs. They also offer silk screening and printing on the face of the discs (silk screening on CD-Rs). You can reach Microforum toll free at 1-800-465-CDCD(2323) or online at www.microforum.ca.     By law, no levy is payable on sales to a society, association or corporation that represents persons with a perceptual disability. Other than this, anyone else must apply for exemption. An application can be made online for exemption of the levy at the CPCC website. For example, if you represent a business that uses the CD-Rs to load data relating to your business, you can make an application for exemption (called the zero-rating program). There is a fee for the application (which reoccurs annually) so you will need to calculate how many discs you would use in a year to determine if the annual fee for exemption is warranted. i.e. If you are using hundreds or thousands of CD-Rs per annum, the annual fee may be worth paying , as there can be substantial savings in the long run. If your CD-R usage is low, it may be better to just pay the levy.     You can review the Table below to help you determine if it is worth it to apply for the levy exemption or not. Number CDRs/Annum Annual Fee Levy per Annum* Savings Per Year! 100 $60 $29 NONE 500 $60 $145 $85 1,000 $60 $290 $230 5,000 $60 $1,450 $1,390 10,000 $60 $2,900 $2,840     Generally, unless your business uses at least 500 CD-Rs a year, it is not worth it to apply for levy exemption in Canada. If your organization goes through thousands of discs per year, it is definitely worth making the application. As long as your business does not resell the media in its blank unrecorded form (i.e. you are loading data to the media in the course of your business), the CPCC will most likely approve your application. Back to top     How can I avoid getting ripped off?     If you buy at the Retail level, the levy is built into the price automatically. This is because the wholesaler or importer of the Blank Media is required to add the levy at the time of sale of the Blank Media. So, the retailer is buying the CD-R media with the levy applied, and the Importer is paying the levy to the CPCC. If you have a valid business and are buying your media at the retail level, you may be (unknowingly) getting ripped off! The levy is buried in the cost of the CD-R by the time you go over to your local retailer to buy it (Staples, Business Depot, Best Buy, Walmart, etc).     If you are only buying a spindle or two a year, this may not be a big deal. But, if your business is going through hundreds of discs a year, you should consider buying direct from a wholesaler or importer. Doing so could save you thousands of dollars in hidden levies! (see Table above for potential savings). Back to top     How much does the CPCC collect and what do they do with the money?     Information can be found on the CPCC website in their Financial Information at www.cpcc.ca.     The money is distributed according to guidelines set by the Copyright board… the breakdown is:     Eligible Authors  66.0%     Eligible Performers 18.9%     Eligible Makers 15.1%     An author is typically the Canadian songwriter, a performer is typically the Canadian musician or singer, and the "maker" refers to a Record Label (which doesn’t have to be Canadian). Back to top     Where Can I Go to Get Duplication Services?     There are many CD Duplication Companies in Canada. It is important to choose a Duplicator that is registered with the CPCC. A registered duplicator is more likely to be purchasing their media from reliable registered sources. A non-registered Duplication Provider either is not submitting proper reports to the CPCC, or worse, may be buying from the Grey Market!     You can contact the CPCC (www.cpcc.ca) for a list of registered vendors. Back to top     Disclaimer     You should not rely solely on this material for making business decisions. Always consult with your legal advisor. Material from other websites is provided for informational purposes only. The other websites all have their own disclaimers. Links to commercial sites are provided for your convenience only. We have tried to ensure that all of the material presented on this page is accurate and factual. Where possible, links to original source documents are also provided, so you can confirm the information for yourself. Back to top   Copyright ® 2010 cdduplicationcanada.net. All Rights Reserved.