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Data mining and copyright: A bittersweet

technology gift for copyright owners and the
Malaysian public?

Pek San Tay *, Cheng Peng Sik

Faculty of Law, University of Malaya, Kuala Lumpur, Malaysia

A B S T R A C T

Keywords: The Age of Big Data is marked by an explosion of digital information that is captured by
Big data new digital technologies. The volume, velocity and variability of the data that is captured
Databases surpass the processing capacity of the human mind. Understanding text contents and cor-
Data mining relations can no longer be performed without the intervention of technology. Data mining
Data analytics refers to the process of using software techniques to analyze large amounts of data sets in
Copyright infringement order to discover useful information. The information is usually in the form of patterns or
Fair dealing relationships that might otherwise not be observed if scanned by the human eye and is there-
Transient copy fore useful for many industries in predicting future trends. However, data mining involves
Balance of interests in copyright the reproduction of databases and, accordingly, raises copyright issues. The objective of this
paper is two-fold. First, it identifies the copyright issues arising from data mining and analy-
ses its legality under Malaysian copyright law. Secondly, it discusses how copyright law can
play a role to regulate data mining so as to protect database owners without hindering the
public interest to enjoy the benefits of data mining. It concludes by recommending how the
Malaysian Copyright Act 1987 may be amended in order to strike a balance between the
competing interests of database owners and that of the public so that the benefits of data
mining may be optimised.
2016 TAY Pek San & SIK Cheng Peng. Published by Elsevier Ltd. All rights reserved.

In relation to such data sets, the standard database software

1. Introduction
In todays world of big data, an ever-increasing volume of data
is captured, aggregated and processed by new digital tech-
nologies such as the internet, smartphones, tablet computers,
sensors and social media. There is a massive increase in the
size of data sets that are generated, the speed of generation
of the data is rapid and the types of data are extremely diverse.1
is not capable of capturing, storing, structuring and analyz-
ing the data in order to yield insightful trends or statistics that
are beneficial to most organisations. Technological advances
have enabled analytics tools to be developed which can quickly
sift through vast amounts of data in a database in order to
extract useful information, analyse them and develop previ-
ously unknown patterns or statistics which are potentially
useful for an organisation to make informed decisions. Data

* Corresponding author. Faculty of Law, University of Malaya, 50603 Kuala Lumpur, Malaysia.
E-mail address: tayps@um.edu.my (P.S. Tay).
1
Fishleigh, J., A Non-Technical Journey into the World of Big Data: An Introduction (2014) 14 Legal Information Management, Issue 2 at 149
151, available at http://www.paynehicksbeach.co.uk/docs/publications/2014legalinformationmanagementvol14no2v01szb.pdf (last accessed
16/2/2016). In this paper, the word data is intended to include texts, images, sounds, videos, photos and any other types of content that
can be analysed electronically.
http://dx.doi.org/10.1016/j.clsr.2016.07.008
0267-3649/ 2016 TAY Pek San & SIK Cheng Peng. Published by Elsevier Ltd. All rights reserved.

Please cite this article in press as: Pek San Tay, Cheng Peng Sik, Data mining and copyright: A bittersweet technology gift for copyright owners and the Malaysian public?,
Computer Law & Security Review: The International Journal of Technology Law and Practice (2016), doi: 10.1016/j.clsr.2016.07.008
 ARTICLE IN PRESS
2 computer law & security review (2016)
mining is the application of specific algorithms to search, index
and analyse electronic databases so as to yield insightful pat-
terns that would not have been possible if conducted manually.
The ability of data mining technology to extract new knowl-
edge from databases is widely acknowledged. For instance, in
the meteorological industry, the analysis of multi-source
weather data can generate trends that can be used to predict
future weather.2 In the healthcare industry, patient data gen-
erated by hospital charts, sensors, monitors and doctors records
can be analysed to garner insights on improving treatment and
hospital care.3 In the higher education sector, data mining of
databases containing scholarly literature offers great re-
search trends for academicians.4 In the commercial world, data
about customer habits, behavior, preferences and spending pat-
terns can be analysed to garner previously unknown trends
in order to provide better products and services.5
Big data analytics is very much at the infancy stage in Ma-
laysia but it is a growing area which has recently been given
emphasis by the Government. In January 2015, the Govern-
ment launched the National Big Data Analytics Innovation
Network to accelerate the adoption of big data analytics in the
country. Pursuant to that, a network of Big Data Innovation
Centres of Excellence was established to work on dengue pre-
diction and prevention, fighting organised crimes including drug
trafficking and pinpointing tax fraud through predictive
analysis.6 These projects inevitably utilise data from a variety
of sources including databases from the private sector, open
data7 and purchased data.
In light of the growing interest in the Malaysian public and
private sectors about the benefits of big data analytics, the ob-
jective of this paper is to identify the copyright issues that arise
from data mining in Malaysia and analyse whether data mining
is legal or otherwise under Malaysian copyright law. In a sense,
data mining is a double-edged sword. On the one hand, data
mining is a boon to many industries. For instance, as noted
earlier, researchers and industry players can obtain new in-
sights in order to forge forward into new frontiers. On the other
2
Olaiya, F. and Adeyemo, A.B., Application of Data Mining Tech-
niques in Weather Prediction and Climate Change Studies (2012) 4
International Journal of Information Engineering and Electronic Busi-
ness, No 1 at 5159, available at http://www.mecs-press.org/
ijieeb/ijieeb-v4-n1/v4n1-7.html (last accessed 16/2/2016).
3
Jensen, P.B., Jensen L.J. and Brunak, S., Mining Electronic Health
Records: Towards Better Research Applications and Clinical Care (2012),
13 Nature Reviews Genetics at 395405, Odgers, D.J. and Dumontier,
M., Mining Electronic Health Records Using Linked Data (2015), Pro-
ceedings AMIA Joint Summits on Transnational Science, available
at http://www.ncbi.nlm.nih.gov/pmc/articles/PMC4525267/ (last ac-
cessed 16/2/2016).
4
Guadamuz, A. and Cabell, D., Data Mining in UK Higher Educa-
tion Institutions: Law and Policy (2014) 4 Queen Mary Journal of
Intellectual Property 3.
5
See generally, Linoff, G.S. and Berry, M.J.A., Data Marketing Tech-
niques: For Marketing, Sales, and Customer Relationship Management,
3rd ed (Wiley Publishing, 2011).
6 8
See MDeC Launches National Big Data Analytics (BDA) Innovation
Network, available at http://www.mimos.my/paper/mdec
-launches-national-big-data-analytics-bda-innovation-network/ (last
accessed 16/2/2016).
7
Open data are data that any person can freely use, re-use and
redistribute subject to requirements of attribution and share alike.
Please cite this article in press as: Pek San Tay, Cheng Peng Sik, Data mining and copyright: A bittersweet technology gift for copyright owners and the Malaysian public?,
Computer Law & Security Review: The International Journal of Technology Law and Practice (2016), doi: 10.1016/j.clsr.2016.07.008
hand, it can also be a bane. For instance, competitors who gain
access to the database of a business owner can mine the data
and potentially obtain a competitive advantage over that busi-
ness owner. Accordingly, another objective of this paper is to
consider how copyright law can play a role to regulate data
mining so as to protect the private interest of copyright owners
in their databases without hindering the public interest to enjoy
the benefits of data mining.
The paper is organised as follows. The second section of this
paper provides an overview of the data mining process in order
to identify the steps within the process that raise copyright
issues. The third section discusses the protection which Ma-
laysian copyright law confers on databases and analyses the
nature and scope of the exclusive right conferred on data-
base owners. The fourth section examines whether data mining
interferes with the reproduction right of the database owner.
The fifth section considers whether the exceptions to copy-
right provided by the Copyright Act 1987, namely, the fair dealing
and transient reproduction exceptions, provide a defence to
data mining. In light of the benefits and real threats to copy-
right owners posed by data mining, the final section concludes
with some thoughts on how the Malaysian Copyright Act 1987
could regulate data mining while, at the same time, further the
primary purpose of copyright law which is to maintain a deli-
cate balance between the private needs of database owners and
the public interest to benefit from data mining activities. As
the thrust of this paper is to examine the intersection between
data mining and copyright law in Malaysia, the ensuing dis-
cussion is confined to databases which enjoy copyright
protection. Databases which are not protected by copyright,
either because of the lack of originality or the inability to meet
the intellectual creation requirement, are outside the purview
of this paper.
2. Data mining operations
There are different techniques of data mining which technol-
ogy offers. In his study on the legal framework of data mining,
Jean-Paul Triaille8 provides a general description of the differ-
ent steps which are involved in most data mining operations.
The steps are essentially as follows although it is recognised
that the methodology of data mining together with the details
and specifics will differ on a case to case basis depending on
factors such as the software that is used, the expertise of the
analyst undertaking the task, the complexity of the data under
consideration and the purpose of conducting the data mining
exercise. Once the objective of the data mining is estab-
lished, the databases to be mined are identified and the initial
data corpus is determined. This is a pre-processing step which
involves data cleaning to remove inconsistent data. Data for
the mining process is usually obtained from more than one
database. In such a case, the process of data integration takes
See Triaille, Jean-Paul, dArgenteuil, Jrme de Mees and de
Francquen, Amlie, Study on the Legal Framework on Text and Data
Mining (TDM) (European Union, 2014), available at http://ec.europa.eu/
internal_market/copyright/docs/studies/1403_study2_en.pdf (last ac-
cessed 16/2/2016), Han, J., Kamber, M. and Pei, J., Data Mining: Concepts
and Techniques, 3rd ed (Elsevier, 2012) at 67.
 ARTICLE IN PRESS
computer law & security review (2016)
place where multiple data sources are combined. The result-
ing data is then stored in a data warehouse. Analytics tools
such as spiders, crawlers or bots are then applied to search
through the databases and select data relevant to the analy-
sis. The relevant data are then extracted from the database,
which essentially is a reproduction of the relevant data. This
step may involve the whole or a substantial part of the data-
base. The purpose of the extraction is usually to convert the
data into a single format that is suitable for the software op-
erational needs.9 The extracted data is stored in a repository
in a computer. The process of analysis then takes place in order
to extract data patterns. At this juncture, some key data may
be separated from the rest of the content as the software sys-
tematically verifies the existence of new patterns or structure.
The data may be indexed, linked, compared and contrasted,
aggregated, merged or disassembled. The output of the analy-
sis is a report which yields new knowledge such as previously
unknown patterns, statistics, number of occurrences and
relationships.
There may be exceptional situations where the analytics
tool only crawls through the database and does not extract
the data. Instead, the analytics tool directly accesses and pro-
cesses part by part of the database individually without making
any copies to download. The analytics tool merely analyses a
small section of the database content one at a time before
moving on to the next section. Such operations do not pose
copyright issues because no reproduction of the database or
any part of it is involved. This usually applies to simple data
mining operations where a one-time access is sufficient.10
The above account is a general description of the steps that
are involved in a data mining operation in order to provide the
contextual background for the ensuing discussion as to what
exclusive rights of copyright owners are infringed in the course
of a data mining operation and when the rights are infringed.
It is not intended to be a detailed description of the technical
processes that take place during data mining operations.
3. Copyright protection of databases in
Malaysia
As noted in the previous section, one of the steps in the process
of a data mining operation involves data selection where data
which are relevant to the analysis are extracted from the da-
tabases and converted into a format that is suitable for mining.
Essentially, a part of or the entire database is reproduced in
the process. In light of such reproduction of the database, this
section and the next examines how copyright law protects da-
tabases in Malaysia especially with regard to the issue of the
reproduction of data in the course of data mining.
Database is protected in Malaysia through the Copyright Act
1987. Unlike the position in Europe where sui generis protec-
tion exists for databases under the European Union Directive
on Database 96/9/EC,11 Malaysia does not have a regime for the
9
Triaille et al., ibid at 28.
10
Ibid at 47.
11
Directive 96/9/EC of the European Parliament and of the Council
of 11 March 1996 on the legal protection of databases.
Please cite this article in press as: Pek San Tay, Cheng Peng Sik, Data mining and copyright: A bittersweet technology gift for copyright owners and the Malaysian public?,
Computer Law & Security Review: The International Journal of Technology Law and Practice (2016), doi: 10.1016/j.clsr.2016.07.008
3
protection of databases.12 Indeed, the term database does not
appear at all in the Copyright Act 1987. However, the word data
appears in section 8 which regards compilations of mere data
as derivative works. Database is defined in the Oxford English
Dictionary as a structured set of data held in computer storage
and accessed or manipulated by means of specialized soft-
ware. The requirement that there be some structure to the set
of data excludes, as a matter of course, those collections of data
that are disorderly or disorganised even though they may
contain valuable bits of information that are of interest to data
miners. Such collections of data are not databases as they do
not meet the definition of the term. Accordingly, they do not
enjoy copyright protection in Malaysia and the mining of data
from such collections does not raise copyright issues.
Of greater interest to the discussion in this paper are those
databases which are created with some structure in mind. The
extent of investment, whether in the form of skill, labour,
finance, time or other entrepreneurial effort, which is ex-
pended in creating such databases varies from insignificant to
substantial. This aspect is important because only databases
which meet the originality test under copyright law enjoy copy-
right protection while those that do not meet the test are
outside the purview of copyright. The originality test as spelt
out in section 7(3) of the Copyright Act 1987 requires suffi-
cient effort to be expended to make the database original in
character.
Under the Copyright Act 1987, two provisions confer copy-
right protection on databases. These are, first, compilations of
data under the broad category of literary work spelt out in
section 7(1)(a). Literary work is defined in section 3 as en-
compassing a wide range of works, one of which is
compilations, whether expressed in words, figures or symbols
and whether in a visible form. The second provision is found
in section 8(1)(b) which protects databases as derivative works.13
Pursuant to section 8(1)(b), copyright is conferred upon col-
lections of works eligible for copyright or compilations of mere
data whether in machine readable or other form, which con-
stitute intellectual creation by reason of the selection and
arrangement of their contents.
The presence of two separate provisions within the Act that
can protect databases raises an anomaly because of the two
different threshold levels for copyright protection spelt out in
the sections. For compilations under section 7(1)(a), the test
of originality is embodied in section 7(3)(a). The sub-section
provides that a literary work shall not be eligible for copy-
right unless sufficient effort has been expended to make the
work original in character. The amount of effort is a question
of degree in each case but simply making a list or putting several
12
Compare, for instance, the position in the UK where data-
bases are protected under two separate legal regimes, namely,
copyright and database right. Database right is granted to all da-
tabases but only databases that satisfy the criteria for copyright
will enjoy copyright protection. In the US, databases are pro-
tected by copyright law as compilations under the Copyright Act
1976. There is no specific database right in the US.
13
A derivative work is a work based upon or derived from one
or more pre-existing works. Examples include the translation of
a work, the adaptation of an existing work such as the making of
a movie based on a novel or vice versa, and the arrangement of
an existing piece of music.
 ARTICLE IN PRESS
4 computer law & security review (2016)
lists together does not amount to sufficient effort.14 In the land-
mark English case of University of London Press Ltd v University
Tutorial Press Ltd,15 Peterson J made it clear that originality in
copyright law was not concerned with the originality of ideas.
Neither should the notion of originality be equated to novelty
or innovativeness because copyright law is not concerned with
the quality of a work.16 According to Peterson J, originality meant
that the work must have originated from the author and that
sufficient skill and labour must have been expended into
making the work. However, for databases under section 8(1)(b),
which are described as collections of works or collections of
mere data, it is a requirement that the selection and arrange-
ment of the constituent items constitute intellectual creation.
As in the case of compilations under section 7(1)(a), it is irrel-
evant whether the constituent items of a database under section
8(1)(b) enjoy copyright protection or otherwise. The phrase in-
tellectual creation has not been interpreted by Malaysian courts
as yet. Notwithstanding this, it is likely that Malaysian judges
would take the cue from its European counterpart where the
standard for originality under the European Union Copyright
Directive 2001/29/EC is intellectual creation. In other words,
the author has exerted some intellectual judgment in the se-
lection of the material or the method of their arrangement
instead of the mere exercise of skill and labour, which is a less
stringent requirement.17 In light of the higher standard that
is required by section 8(1)(b) when compared with section 7(1)(a),
it is questionable whether the former section furthers any useful
purpose since it would be less exacting to meet the require-
ments of section 7(1)(a). This is especially so since there is no
distinction in the scope of copyright protection conferred on
the owner of a compilation or a database.
The above differs markedly from the position in the United
Kingdom where compilations are treated differently from da-
tabases because of the existence of the sui generis database right
which was put in place by the European Union Database
Directive.18 The Database Directive was enacted in the United
Kingdom by the Copyright and Rights in Databases Regula-
tions 1997 (SI 1997/3032) which established a two-tier system
of protection for databases.19 For databases where the selec-
tion or arrangement of the data amounts to the authors own
intellectual creation, copyright protection is conferred on the
database under section 3A(2) of the Copyright, Designs and
Patents Act 1988. For databases where the selection or arrange-
ment of the raw materials does not amount to the higher
standard of intellectual creation but nevertheless its compi-
lation calls for a substantial investment in the obtaining,
verification or presentation of its contents, a 15-year period of
protection from the date the database is made available to the
14
Hardial Singh Hari Singh v Daim Zainuddin & Ors [1991] 2 CLJ (Rep)
701.
15
[1916] 2 Ch 601.
16
Copyright Act 1987, section 7(2).
17
Infopaq International A/S v Danske Dagblades Forening [2012] EUECJ
C-302/10, Public Relations Consultant v The Newspaper Licensing Agency
Limited and Others [2013] UKSC 18.
18
Above n. 11.
19
The Copyright and Rights in Databases Regulations 1997 came
into force on 1 January 1998.
Please cite this article in press as: Pek San Tay, Cheng Peng Sik, Data mining and copyright: A bittersweet technology gift for copyright owners and the Malaysian public?,
Computer Law & Security Review: The International Journal of Technology Law and Practice (2016), doi: 10.1016/j.clsr.2016.07.008
public is granted to the maker of the database.20 The invest-
ment may be in the form of financial, human or technical
resources and its substantiality is judged qualitatively and
quantitatively.21 It is possible for a database to enjoy copy-
right protection if it is original22 and, at the same time, to be
conferred database right if substantial investment had been
expended in creating the database.23 The database right pro-
tects the raw data contained in the database and not the
arrangement of the database.
In Malaysia, regardless of whether the work is a compila-
tion or a database, what is ultimately protected by copyright
is not the individual item of information but the skill and effort
that has been expended in creating the compilation or in the
selection and arrangement of the information.24 It is the skill
and effort which has been expended that confers originality
on the work to merit copyright protection. This is illustrated
in the Malaysian High Court case of Penerbit Fajar Bakti Sdn Bhd
v Cahaya Surya Buku dan Alat Tulis25 where the plaintiff alleged
that the defendants had infringed their copyright in two books.
The books were anthologies of short stories and poems. The
plaintiff claimed that they had copyright in both the books as
a collection of works. In defence, the defendants argued that
since the plaintiff was not the author of the individual stories
and poems, they could not have copyright in the collection of
works. However, the court held that a distinction should be
made between, on the one hand, the copyright in the indi-
vidual stories or poems and, on the other hand, the copyright
in the collection. According to the court, the person who com-
piled the books had expended skill and labour in the
compilation and, accordingly, was the copyright owner of the
compilation although not the copyright owner of each of the
individual stories or poems.
4. Infringement of copyright in compilations
and databases
The nature of the exclusive right given to the copyright owner
in a compilation and a database is the same and this is pro-
vided in section 13(1) of the Copyright Act 1987. The exclusive
right which is granted to the copyright owner is in essence a
bundle of exclusive rights. The most relevant right in the context
of data mining is the right to control the reproduction of the
work in any material form. Reproduction is defined in section
3 of the Act as the making of one or more copies of a work in
20
Copyright and Rights in Databases Regulations 1997, regula-
tions 17(2) and 14.
21
British Horseracing Board Ltd (BHB) v William Hill Organisation Ltd
(C-203/02) [2005] RPC 260.
22
In Football Dataco and Others v Yahoo and Others [2012] EUECJ C-604/
10, the CJEU reaffirmed, at para 38, that originality for copyright
purposes required the author to express his creative ability in an
original manner by making free and creative choices through the
selection and arrangement of the data. Skill and judgement alone,
albeit significant, was not sufficient.
23
Copyright and Rights in Databases Regulations 1997, regula-
tion 13(1).
24
Khaw, L.T., Copyright Law in Malaysia, 3rd ed (LexisNexis, 2008)
at 79.
25
[1989] 1 MLJ 386.
 ARTICLE IN PRESS
computer law & security review (2016)
any form or version. In turn, copy is also defined in the section
as a reproduction of a work in a written form, in the form of
a recording or film or any other material form. Material form
is defined in the same section as including any visible or non-
visible form of storage from which the work may be reproduced.
The reproduction right is not limited to the making of dupli-
cate or facsimile copies but extends also to the making of copies
in a medium different from that of the original. For instance,
making a copy of an electronic database that is available on
a network and downloading it into the random access memory
of a computer or a USB stick is an act of reproduction.
The reproduction right enables the copyright owner to
control the reproduction of the whole work or a substantial
part of it. As noted earlier, in order to undertake data mining,
copying of the whole or a substantial part of the compilation
or database is usually required.26 Where the entire work is
copied by the defendant, it is fairly straightforward to estab-
lish that infringement of the compilation or database has
occurred.
More problematic is the case where more than a small part
of the compilation or database is reproduced by the analytics
tool in the course of data mining. The difficulty lies in deter-
mining whether the part that is taken amounts to a substantial
part for the purpose of proving infringement. Cases have firmly
established that substantiality is a question of fact which is
determined primarily by reference to the quality of that part
which is copied in relation to the work as a whole although
the quantity copied is also a relevant factor.27 Bearing in mind
that copyright protection of databases and compilations es-
sentially aims to protect the skill and effort in creating the
databases, the question arises as to what exactly is the nature
of the skill and effort where electronic databases are con-
cerned. A general description of database creation is as follows,
although obviously it is only representative because the details
will differ depending on the subject, type of database and tech-
nology involved.28 The first step is for the database maker to
identify the purpose of the database. Once that is done, the
maker needs to carefully design the database. At this stage,
he has to decide the structure of the database or its format,
which includes matters such as the major subject content, the
types of information that would be stored in each subject
content, how the information is to be organised once it is cap-
tured, how it may be retrieved and the sort of report or overall
information he wants to generate from the database. Next, he
has to acquire software that is designed to carry out that
purpose or engage a computer programmer to create the soft-
ware programme. With that in place, he will then input any
existing data that he has and searches for more data continu-
ously from sources he has identified. Unlike the manual creation
of a database, once the data is input into the system, the com-
puter software will organise the information to the assigned
26
See section 2 above.
27
Longman Malaysia Sdn Bhd v Pustaka Delta Pelajaran Sdn Bhd [1987]
2 MLJ 359, Megnaway Enterprise Sdn Bhd v Soon Lian Hock (sole pro-
prietor of the firm Performance Audio & Car Accessories Enterprise) [2009]
3 MLJ 525.
28
See generally, Steps in designing a database, available at
http://www.technologyforall.com/TechForAll/datadesigning.htm (last
accessed 16/2/2016).
Please cite this article in press as: Pek San Tay, Cheng Peng Sik, Data mining and copyright: A bittersweet technology gift for copyright owners and the Malaysian public?,
Computer Law & Security Review: The International Journal of Technology Law and Practice (2016), doi: 10.1016/j.clsr.2016.07.008
5
section. The effort at this stage is negligible in so far as the
maker is concerned because the task is handled by the soft-
ware. Apart from the skill and effort in searching and selecting
the data for input, a significant amount of skill and effort takes
place during the early stages of identifying the purpose of the
database, designing it and creating software that will carry out
the task of storing the information in an organised fashion.
Notwithstanding that the database is only created at the point
in time when the data is input into the system, the House of
Lords decision in Ladbroke (Football) Ltd v William Hill (Football)
Ltd,29 which has been followed in Malaysia,30 confirms that pre-
liminary or preparatory works constitute labour and skill in
assessing the originality of the compilation or database. Ac-
cording to the court, it is not possible to separate the different
stages and focus only on the step of presenting the work in
material form as the sole factor in determining sufficiency of
skill and labour.
In data mining, once the data miner gains access to the da-
tabase to be mined, analytics tools are applied to search through
the database. The whole of the database or a large portion of
it is copied and converted into a format to meet the opera-
tional needs of the software so that the data can be analysed.
As discussed earlier, much skill and effort is expended in de-
veloping the structure and design of the database as well as
searching and selecting the data for input into the database.
By reproducing a substantial part of the structure and design
of the database as well as the data itself, the data miner has
appropriated for himself the skill and effort which the data-
base maker has put into creating the database. Even if only
the data is taken but not the structure or design of the data-
base, there would still be an appropriation of the database
makers skill and effort in searching and selecting the data for
input into the database, It is this aspect that is objectionable
and not the reproduction of the data itself because there is no
copyright in data per se since copyright law only protects the
form of expression of an idea and not the idea itself, unless
the data in the database is a work that is protected by copy-
right. Every data in the database is important and the copying
of a large quantity of data in relation to the whole database
amounts to taking a substantial part of the skill and effort of
the owner.31
It is conceded that one of the factors commonly used in as-
sessing substantiality, which is whether the part of the database
taken may prejudice the sale or compete with the original
work,32 may weigh in favour of the data miner. This is because
the data that is extracted by the analytics tool is used for analy-
sis purposes only in order to yield an output that produces
useful information. The output is an independent creation
which is an analysis of the original data and is typically in the
form of a report, graph, table or chart and hence does not
contain any of the original data that were mined. Notwith-
standing this, since the question of substantiality is a matter
29
[1964] 1 WLR 273.
30
Radion Trading Sdn Bhd v Sin Besteam Equipment Sdn Bhd & Ors
[2010] 9 MLJ 648.
31
Copyright Act 1987, section 7(2A), Onestop Software Solutions (M)
Sdn Bhd v Masteritec Sdn Bhd & Ors [2009] 8 MLJ 528.
32
Longman Malaysia Sdn Bhd v Pustaka Delta Pelajaran Sdn Bhd [1987]
2 MLJ 359.
 ARTICLE IN PRESS
6 computer law & security review (2016)
of degree and involves many mixed factors, it is submitted that
analytics tools that extract a large portion of a database in terms
of the quantity of data and the databases structure are actu-
ally reproducing a substantial part of the database. Accordingly,
it appears that data mining operations where the whole or a
substantial part of the database is extracted by the analytics
tool amounts to copyright infringement.
5. Are there any defences available to data
miners?
Once copyright infringement is made out, it is for the defen-
dant who wishes to escape liability to argue that his activities
fall within the ambit of the statutory exceptions provided by
the Copyright Act 1987. Two exceptions are relevant for con-
sideration in the context of data mining. These are, first, the
fair dealing exception in section 13(2)(a) and, secondly, the
making of a transient and incidental electronic copy of a work
in section 13(2)(q).
Pursuant to section 13(2)(a), it is a defence to an action for
copyright infringement if the act is done by way of fair dealing
including for purposes of research, private study, criticism, review
or the reporting of news or current events. The provision further
imposes the requirement that the act is accompanied by an
acknowledgement of the title of the work and its authorship
unless it is in connection with the reporting of news or current
events by means of a sound recording, film or broadcast. Prior
to the Copyright (Amendment) Act 2012, this exception was
only available for acts carried out in respect of any of the fol-
lowing five purposes: non-profit research, private study,
criticism, review and the reporting of current events. Acts done
for any other purposes cannot benefit from the fair dealing
exception.33 However, after the amendment in 2012, the pre-
viously narrow scope of the provision has been broadened. The
insertion of the word including before the prescribed pur-
poses has the effect of widening the scope of the exception
such that it is no longer confined to those five purposes.
Nevertheless, the exact boundary of this exception remains
to be seen because the section appears now to be amenable
to two possible interpretations. The first, which is a restric-
tive interpretation, takes the view that although the exception
is no longer tied to the purposes of the act, the ejusdem generis
rule should apply and, therefore, the purpose of the act should
be of the same general nature or kind as those specified in the
provision. In other words, the act should have a purpose similar
in nature to non-profit research, private study, criticism, review
or the reporting of news or current events. The second inter-
pretation, which is more liberal, takes the view that any act
can benefit from the fair dealing provision without the need
to be of a similar nature to the specified purposes. Regard-
less of whether the restrictive or liberal approach is adopted
by the court, there is still the requirement that the dealing must
be fair. In this regard, section 13(2A) spells out four factors which
a court should consider when determining whether a dealing
is fair. These factors are similar to the factors for determin-
33
MediaCorp News Pte Ltd & Ors v MediaBanc (JB) Sdn Bhd & Ors [2010]
6 MLJ 657.
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ing fair use under the US Copyright Act of 197634 and are as
follows:
(a) The purpose and character of the dealing, including
whether such dealing is of a commercial nature or is for
non-profit educational purposes
(b) The nature of the copyright work
(c) The amount and substantiality of the portion used in re-
lation to the copyright work as a whole, and
(d) The effect of the dealing upon the potential market for
or value of the copyright work
The four factors, which were inserted by the 2012 Amend-
ment Act, have arguably changed the character of the fair
dealing exception under Malaysian copyright law and align it
towards the US fair use concept. The fair dealing exception
hinges on the established three-step test, which first emerged
at the 1967 Stockholm Conference of the Revision of the Berne
Convention for the Protection of Literary and Artistic Works.
The three-step test provides that exceptions and limitations
to the reproduction right may be made to national copyright
laws in certain special cases provided that the reproduction
does not conflict with a normal exploitation of the work and
does not unreasonably prejudice the legitimate interests of the
copyright owner. In contrast, the current fair dealing defence
in section 13(2)(a) is an open-ended, flexible provision where
fair balance is assessed based on a balancing test of a number
of factors.
Data mining is essentially research oriented because it is
the computational analysis of data contained in databases. The
research that is carried out can either be for commercial or non-
commercial purposes. While it is clear that prior to the 2012
amendment, the research had to be solely for non-profit
purpose to be considered for the fair dealing exception, the
current provision has removed the non-profit qualifier so that
only the word research is used. This seems to suggest that
commercial research can also benefit from the fair dealing ex-
ception. Support for this may be found in the Canadian Supreme
Court decision in Canada Law Book Inc v Law Society of Upper
Canada35 which held that the word research in its fair dealing
provision should be given a liberal interpretation and not be
limited to non-commercial or private contexts so as to ensure
that users rights are not unduly constrained. In that case, it
was held that lawyers research for the purpose of advising
clients, giving opinions, arguing cases and preparing briefs quali-
fied as research within the fair dealing exception. On the
assumption that Malaysian courts follow this line of reason-
ing, all data mining activities, commercially motivated or
otherwise, can potentially benefit from this exception pro-
vided that they are fair having regard to the factors stated in
section 13(2A).
With regard to the first factor, it is an important consider-
ation whether the defendants act is for a commercial purpose
or non-profit educational purpose. This suggests that data
mining that is carried out for non-profit educational purpose
is more likely to qualify for the fair dealing defence than that
34
17 US Code 107.
35
[2004] SCC 13.
 ARTICLE IN PRESS
computer law & security review (2016)
which is done to achieve commercial ends. Be this as it may,
the US Supreme Court in Campbell v Acuff-Rose Music, Inc36 stated
that the focus of this factor is on whether the new work merely
supersedes the objects of the original creation, or whether and
to what extent it is transformative, altering the original with
new expression, meaning, or message. The court stressed that
[t]he more transformative the new work, the less will be the
significance of other factors, like commercialism, that may
weigh against a fair use.37 In data mining, the output is un-
deniably highly transformative in nature since the results yield
statistics, patterns, relations, trends and the like which do not
at all resemble the original data or content in the databases.
On the assumption that Malaysian courts recognise that trans-
formative uses may qualify as fair use, the first factor is likely
to favour data mining especially if it is carried out for non-
profit educational research. Even if the data mining activity has
a commercial purpose, the highly transformative nature of the
output may overshadow its commercial aim. This would, there-
fore, mean that the first factor may weigh in favour of data
mining activities irrespective of whether they are for com-
mercial or non-commercial purpose.
The second factor deals with the nature of the copyright
work in question. In general, copyright law tolerates a use made
of factual works more than that made of creative works.38 The
data in databases are often factual in nature and since the scope
of fair use is wider with respect to factual than non-factual
works, it is likely that this factor will also favour data mining
activities.
The third factor is the amount and substantiality of the
portion used. This is likely to weigh against data miners because
the analytics tools will usually copy large parts of the data-
base for analysis purpose so as to ensure accuracy of the output
results.
The final factor, which is the effect of the dealing upon the
potential market for or value of the copyright work, is likely
to favour data mining because it is difficult to conceive that
the trends, patterns, statistics or relations revealed in the output
would in any way compete with the market for or value of the
database. The output is unlikely to be a substitute for the copy-
right work and therefore will not undermine the market for
the work.
To surmise, the application of the four factors to data mining,
on the whole, appears to suggest that data mining activities,
whether for commercial purposes or otherwise, are likely to
qualify as fair dealing and, accordingly, do not amount to copy-
right infringement. There is the additional requirement under
section 13(2)(a) that the use of the copyright work must be ac-
companied by an acknowledgement of the title of the work and
its authorship. This may be an arduous task especially if there
are multiple databases which are analysed in the mining
process.
Another exception that appears, at first blush, to be rel-
evant in the context of data mining is the transient and
incidental electronic copy provision under section 13(2)(q). Pur-
suant to the provision, it is not an infringement of copyright
36
510 US 569 (1994) at 579.
37
Ibid.
38
Basic Books, Inc v Kinkos Graphics Corp 758 F Supp 1522 (SDNY,
1991) at 1533.
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7
to make a transient and incidental electronic copy of a work
that is made available on a network if the making of the copy
is required for the viewing, listening or utilisation of the work.
This transient copying defence is a new exception which was
inserted in the Copyright Act 1987 through the Copyright
(Amendment) Act 2012. According to the Explanatory State-
ment in the Copyright (Amendment) Bill 2010,39 the purpose
of this exception is to accommodate fair usage on the inter-
net. This provision therefore legalises activities such as browsing
or caching. Essentially, it allows cached copies to be made in
the random access memory of a computer when an internet
user browses a website. The work contemplated by this pro-
vision is one that must be made available on a network. This
would include online databases which are freely accessible as
well as online databases which are only accessible through a
subscription agreement restricting access through means such
as a password. The exception does not apply to off-line data-
bases in analog or electronic form.
The Act does not define the terms transient and inciden-
tal. In the absence of a definition of those terms in the Act
and in any local case law, guidance may be obtained from ju-
dicial interpretations in foreign jurisdictions. As to what a
transient act is, the Court of Justice of the European Union in
the case of Infopaq International A/S v Danske Dagblades Forening40
(hereafter Infopaq 1) held that an act is transient only if its du-
ration is limited to what is necessary for the proper completion
of the technological process of which it forms an integral and
essential part, being understood that that process must be au-
tomated so that it deletes that act automatically, without human
intervention, once its function of enabling the completion of
such a process has come to an end.41 Thus, to qualify as a tran-
sient copy in the European Union, the duration in which the
copy resides in the system is assessed by reference to what
is necessary to complete the technological process.42 Clearly,
whether a copy which exists for a specified duration is tran-
sient or otherwise would depend on each technological process
involved.
In data mining, it is typically the case that the extracted
data that are deposited into repositories for mining opera-
tions are not temporary in nature or automatically deleted after
a certain time. This is in contrast to copies in the computers
random access memory which are automatically deleted and
replaced by other content when the internet user moves away
from the website viewed or when the computer is turned off.
On the assumption that the CJEUs decision in Infopaq 1 is fol-
lowed by Malaysian courts, a copy qualifies as transient only
if it is one where its removal takes place by an automated
process without human intervention. Since copies stored in
repositories after extraction are not removed automatically but
their removal is dependent on human intervention,43 it does
not appear that this provision is capable of providing any ex-
ception to data mining activities.
39
Explanatory Statement, Copyright (Amendment) Bill 2010, para
11.
40
CJEU 16 July 2009, Case C-5/08.
41
Ibid at para 64.
42
Triaille et al., above n. 8 at 43.
43
Ibid at 46.
 ARTICLE IN PRESS
8 computer law & security review (2016)
With regard to the word incidental which is used in con-
junction with transient in section 13(2)(q), the UK Supreme
Court in Public Relations Consultants Association Limited v The News-
paper Licensing Agency Limited and Others44 opined that the
presence of the word incidental is superfluous because copies
made in the internet cache are necessarily incidental to the
technological process involved. According to the court, tran-
sient copies retained on the screen or the internet cache are
merely the incidental consequence of the internet users use
of a computer for viewing or browsing.
Section 13(2)(q) also stipulates that the copy must be re-
quired to be made for the viewing, listening or utilisation of
the work. While activities such as viewing, browsing, reading,
consulting a webpage, accessing a webpage or listening to a
work have never been within the exclusive right of the copy-
right owner, the same cannot always be said of the utilisation
of a work. A work may be used in a lawful way or an unlaw-
ful way. For instance, if a work is used for the purposes of
teaching, judicial proceedings, setting of examination ques-
tions or non-profit research, the utilisation is lawful. However,
if a work on the internet is downloaded by a third party nu-
merous times for the purpose of commercial transactions, the
use of the work can hardly be said to be lawful.45 In the latter
case, the transient and incidental copy exception clearly cannot
be invoked to protect the third party. Accordingly, section 13(2)(q)
will only apply if the utilisation of the work is lawful. It is there-
fore submitted that section 13(2)(q) will not be available to data
miners to relieve them from copyright infringement.
6. Concluding thoughts: balancing the private
and public interests in data mining
As discussed above, the fair dealing provision in section 13(2)(a)
is likely to provide a defence to data mining activities regard-
less of whether it is for commercial or non-commercial purpose.
However, as was pointed out by the judge in MediaCorp News
Pte Ltd & Ors v MediaBanc (JB) Sdn Bhd & Ors,46 inherent in copy-
right law is the need for a balance between the copyright
owners right to protect his economic benefit, and the need for
society to progress in the development of its creativity and ideas
without undue restriction. The database owner who has ex-
pended a significant amount of time, labour and finance in
designing the database, selecting and arranging the relevant
data for his database would clearly insist on his exclusive right
to control the reproduction of his database. This is especially
so in cases where the data mining activity is carried out by a
competitor who conducts mining operations to further his own
commercial aims, such as for marketing purposes in order to
predict consumers demands or make informed decisions on
new products and thereby placing himself in a more advan-
tageous position. Prior to the 2012 amendment to the Copyright
Act 1987, the database owner had the exclusive right to control
data mining conducted for commercial purposes because the
44
Above n. 17 at para 33.
45
MediaCorp News Pte Ltd & Ors v MediaBanc (Johor Bharu) Sdn Bhd
& Ors, above n. 33.
46
Ibid at 716 para 195.
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then fair dealing provision was tied to the particular pur-
poses spelt out in section 13(2)(a). In other words, the research
had to be for non-profit purposes in order to benefit from the
fair dealing defence. However, the 2012 amendment has
changed this with the consequence that the right initially con-
ferred on the database owner to control data mining activities
which are conducted for commercial purposes has been se-
verely constrained by the current fair dealing provision in favour
of data miners regardless of the commercial or non-commercial
nature of the data mining. Although this may not have been
the deliberate intention of Parliament, the implications brought
about by the changes to the fair dealing provision on data-
base owners are inadvertently far-reaching.
If copyright law is to strike a balance between public access
to creative work and the protection of this work as the prop-
erty of the copyright owner,47 then the Act must, on the one
hand, provide for the optimisation of the great potential offered
by data mining to the public and, on the other hand, economi-
cally reward database owners for their effort in creating the
databases so as to encourage rather than hinder the making
of more databases by others. It is recommended that one way
of achieving this balance is to classify data mining activities
into two categories, corresponding to the primary purpose for
which they are carried out. The first category comprises data
mining which is conducted with the primary purpose of serving
the public interest in the sense that its main aim is to benefit
the public without any commercial motive or agenda on the
part of the data miner. In the vast majority of cases, such data
mining is carried out for non-commercial research, academic
or education goals which benefit the public and further the
progress of society generally. The second category deals with
data mining that is driven by the commercial motives of private
enterprises to achieve their own financial gains. Data mining
under the first category meets one of the avowed purposes of
copyright law to benefit the public and, accordingly, should be
permitted by the law. Indeed, as discussed above, the fair dealing
provision is likely to absolve the data miner from any legal li-
ability as the defence would apply to non-commercial research.
In contrast, the orientation of the second category of data
mining is towards securing financial gains for the data miner
himself or his organisation. If Malaysian judges were to follow
the reasoning in Acuff-Rose48 on transformative uses, this would
likely mean that data mining carried out for commercial re-
search will also satisfy the first factor of the fairness test.
However, to exempt such an activity from copyright infringe-
ment is to subordinate the database owners exclusive
reproduction right to that of the data miners personal gain.
As such, it is submitted that data mining carried out for com-
mercial purposes should not be exempted from copyright
infringement. Instead, the data miner has to first seek a licence
from the data owner to carry out mining activities.
The above suggestion essentially restores to the database
owner the exclusive right which he had enjoyed prior to the
2012 amendment. There is no discernible reason to expropri-
ate that right from him to pave the way for data mining
47
Halbert, D., Mass Culture and the Culture of the Masses: A Mani-
festo for User-Generated Rights (2009) 11 Vand J Ent & Tech L 921 at
953.
48
Above n. 36.
 ARTICLE IN PRESS
computer law & security review (2016)
activities that are commercially motivated. Indeed, this sug-
gestion is in line with the developments in some major
countries in the world. For instance, in 2014, the UK Copy-
right, Designs and Patents Act 1988 was amended to, inter alia,
introduce a new exception to copyright infringement for text
and data mining for non-commercial research provided that
access to the database is lawful.49 Pursuant to the new section
29A of the Act, the making of a copy of a work by a person who
has lawful access to the work is not an infringement of copy-
right provided two conditions are met. First, the copy is made
in order that a computational analysis of anything recorded
in the work may be carried out for the sole purpose of re-
search for a non-commercial purpose. Secondly, the copy is
accompanied by a sufficient acknowledgement unless this
would be impossible for reasons of practicality or otherwise.
In Japan, the legislature has adopted a more liberal stance by
permitting data mining generally unless the database was
created with the aim of data analysis. The Japanese copy-
right statute provides that it is not an infringement of copyright
to reproduce a database for the purpose of information analy-
sis conducted on a computer unless the database is made
specifically for the purpose of using it for data analysis
purpose.50 In Korea, the copyright provision that has an impact
on data mining is more restrictive.51 The copyright legislation
confers on the database producer the right to control the re-
49
Copyright, Designs and Patents Act 1988, section 29A, as
amended by Regulation 3(2) of The Copyright and Rights in Per-
formances (Research, Education, Libraries and Archives) Regulations
2014. The Regulations came into force on 1 June 2014.
50
Copyright Act (Act No. 48 of May 6, 1970, as last amended by
Act No. 63 of December 3, 2010), Article 47septies.
51
Copyright Act 1957, Chapter 4 on Protection of Database Pro-
ducers.
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9
production of all or a considerable part of the database.52
However, any person may reproduce the whole or a consider-
able part of the database in two specified situations, unless the
reproduction conflicts with a normal exploitation of the
database.53 The first situation is the use of the database for edu-
cation, scholarship or research purposes which are not aimed
at making a profit. The second situation is the use of the da-
tabase for reporting current news.
It is interesting to note that in the US, courts have held that
data mining qualifies under the US fair use doctrine and ac-
cordingly does not amount to copyright infringement. This is
due to the highly transformative nature of digital analytics pro-
cesses where the output in the form of new knowledge does
not supplant or substitute the market for the original data-
base. For instance, in the decision of the US Court of Appeals
for the Second Circuit in The Author Guild v Google, Inc,54 it was
held that the Google Books Library Project where Google
scanned millions of books into a searchable database that
enable researchers to carry out data and text mining did not
amount to copyright infringement because it qualified as trans-
formative fair use. 55 This demonstrates that different
jurisdictions have adopted different responses to data mining,
largely because of the merits and demerits of data mining. In
Malaysia, in light of the emphasis given to balancing the two
competing interests, which are the private rights of copy-
right owners and the broader public interest to have access to
the copyright work, it is submitted that the proposed recom-
mendation would best achieve this purpose.
52
Ibid, Article 93-1.
53
Ibid, Article 94(2).
54
Docket No. 13-4829. The decision was delivered on 16 October
2015.
55
An appeal by The Authors Guild was turned down by the US
Supreme Court on 18 April 2016.