Canadians will still be able to record their favorite TV shows to their PVRs, and copy legally acquired music to their iPods, if long-awaited copyright reform introduced by the federal government on Thursday passes into law.

But the proposed amendments to Bill C-61 portend fines for Canadians found with unauthorized computer files, or for those who copy music or movies to CDs or iPods without the permission of copyright holders.

The proposed changes to the Copyright Act call for anyone caught downloading copyrighted material to face a fine of $500, down from a current fine of up to $20,000. And anyone who was ‘unaware’ they were infringing on the rights of copyright holders could be fined as little as $200.

The anti-circumvention language in Bill C-61 proposes to make it unlawful ‘to descramble a scrambled work or decrypt an encrypted work or to otherwise avoid, bypass, remove, deactivate or impair the technological measure, unless done with the authority of the copyright owner.’

The permission of copyright holders in the emerging digital age, as opposed to the receding analog world, is key. For example, Bill C-61 would allow Canadians to record TV shows to watch later on. But the legislation’s fine print would disallow such ‘time-shifting’ if the broadcaster triggers a ‘broadcast flag’ to stop the digital recording of a TV show.

The Copyright Act amendments also propose a $20,000 fine for anyone who breaks a digital lock by, for example, transferring music from a copy-protected CD to an iPod, or who posts copyright-protected video to YouTube.

The proposed bill would also make it unlawful to import, sell or market hacking tools to circumvent digital locks.

‘This is a unique, made-in-Canada approach to copyright reform that is truly a win-win situation for Canadian consumers who use digital technology, and for everyone who creates material that becomes digitally accessible,’ Industry Canada Minister Jim Prentice told reporters, mindful of criticism that Ottawa has parroted U.S anti-piracy legislation with Bill C-61.

Content creators lined up Thursday to applaud the federal government for offering them a share of profits from entertainment product often lost in the past to online piracy.

‘This is only a first step — because film and television performers need a full set of rights under copyright law, the same as every other artist,’ said Richard Hardacre, ACTRA national president.

But indie musicians represented by the Canadian Music Creators Coalition criticized the federal government for introducing Hollywood-inspired anti-piracy measures.

‘As we feared, this bill represents an American-style approach to copyright. It’s all locks and lawsuits,’ said Safwan Javed, CMCC member and drummer for Wide Mouth Mason.

University of Ottawa law professor Michael Geist said Ottawa proposed a ‘blanket prohibition on circumvention,’ with very limited exceptions for privacy or the needs of the education community, for example.

‘The takeaway is that…the government promotes a strategy of locking down content and launching lawsuits against Internet users,’ Geist said in a blog.

How the new anti-piracy measures will be enforced also remained in question Thursday.

Internet service providers, for example, will not have to block access to subscribers who are alleged infringers, as they are required to do south of the border. Instead, they will only have to serve notice to a subscriber that they have been fingered for infringement of copyright.