With most countries in the English-speaking Caribbean unable to negotiate contracts with several American cable programmers, governments in the region have become sympathetic.

Like Bermuda Cablevision, Cable Bahamas could not reach an agreement with several US programmers, so the Bahamas government decided the company did not need one. In January 2000, compulsory licensing legislation went into effect, allowing Cable Bahamas to broadcast any signal it received via satellite, including those it could not reach agreements for.

The legislation made transmission of Bahamian Sidney Poitier's biography, which aired last spring on A&E, legal on Cable Bahamas' system, even though the company has no contract with A&E Television Networks.

"The Bahamas has taken the most proactive approach," said Mark Palchick, a lawyer at Holland & Knight, which represents the Caribbean Cable Cooperative in Washington, D.C.

The lawyer added: "When the government issued Cable Bahamas with a licence, it made a promise to Cable Bahamas that the company would have sufficient programming to offer a service."

To keep that promise, the Copyright Royalty Tribunal, administered by the office of the Bahamas' Registrar General, was assigned to regulate the licensing. Based on per-subscriber rates paid by Canadian cable companies, the tribunal decides how much Cable Bahamas should pay for each channel it carries. Programmers like A&E and Home Box Office (HBO) are then entitled to collect the money.

The situation has been recognised in other countries, too. Jamaica cracked down on cable companies last year operating without a government licence. Several of them were using illegal DirecTV descramblers that allow viewers to watch all of the programming available on the satellite service without paying a subscription fee.

Most had no intention of paying US programmers, and the Jamaican government hoped that cleaning up the country's cable industry would help the 41 legitimate operators negotiate contracts with US programmers. Trinidad took similar action, but neither attempt achieved the intended goal.

Now, Jamaica and Trinidad are both considering compulsory licensing, along with St. Kitts and Barbados.

Legislation has already been passed in St. Lucia, legislation was passed, but it awaits enactment.

"If there was a region-wide compulsory licence law," Mr. Palchick predicted, "the studios would all of a sudden find the resources to sell in the region."

But, as the case of the Bahamas has shown, US programmers will put up a fight. Those who had no agreement with Cable Bahamas before the legislation came into effect also refuse to claim the money collected by the Copyright Royalty Tribunal.

Lawyers say the programmers fear that doing so might somehow indicate their consent to the set-up.

The Motion Picture Association (MPA), which represents studios who own the copyrights for films on many of the disputed channels, has said that the Bahamian legislation sets an unacceptable precedent. The association summarised its viewpoint in a report on the Bahamas by the Intellectual Property Alliance (IIPA), a private-sector coalition of which the MPA is a member.

"Signal theft in this region has completely disrupted the orderly sequential distribution (i.e., release of motion pictures first to theatres, followed by home video, pay television and free television release) of MPA member copyright programming," the report stated.

The MPA directed its complaints to the United States Trade Representative (USTR) with the Department of Commerce. According to the USTR, compulsory licensing of scrambled signals, like those of subscription channels, contravenes the Berne Convention on copyrights. The office contends that while the convention provides for compulsory licenses, they only apply to free, over-the-air signals, not signals for channels like A&E and HBO.

It also said the compensation amounts determined by the tribunal were not sufficient.

But Ronald Oleynik, another lawyer in Washington at Holland & Knight, said that encryption is not addressed by the copyright convention at all. He then produced letters from the World Intellectual Property Organisation that showed that the US tried to amend the convention in 1994 to limit compulsory licences and eventually eliminate them altogether for television broadcasts. Both proposals were defeated, which he said proved the legality of the Bahamian legislation.

Mr. Oleynik added that the legislation was consistent with the World Trade Organisation's Agreement on Trade-Related Aspects of Intellectual Property Rights, which permits licensing practices that infringe intellectual property rights which have adverse effect on competition.

"The persistent boycott by US cable programme channels of the Caribbean has undermined their ability to provide programming that is essential for a cable operator to be competitive," he wrote in a letter, "and in so doing, harmed the development of the telecommunication infrastructure and the education and educational and economic possibilities for all citizens."

Mr. Oleynik suspects that it was the MPA's political clout, not a valid legal argument, which produced the USTR's position.

"I surmise that it was because the MPA wields a great deal of economic power," he said in a telephone interview this week, referring to statements made by the USTR. "(The movie business) is a large US industry that makes a lot of money for the country."

But the Bahamas nevertheless agreed to amend its legislation in favour of US programmers. Mr. Oleynik suspects the country, whose closest islands lie 60 miles from Miami, came under intense political pressure from the US.

It was not a completely raw deal for the Bahamas, though. In exchange, the US government promised to "encourage" US rights holders to negotiate commercial agreements with Cable Bahamas.

But in a letter to HBO president Jeffrey Bewkes, the assistant USTR maintained that the Bahamas legislation was illegal under international law and wrote: ".please note that individual company decisions on licensing programming in the Bahamas, or any other market, are not preconditions to ensuring that Governments do not broaden the scope of compulsory licenses beyond that which is permitted under international law and practice."

Since then, the programmers have not changed their policies and despite the threat of trade sanctions, compulsory licensing is still in effect in the Bahamas; an amendment to the original legislation was presented to the legislature in December, but has yet to be debated.

According to Mr. Palchick, it is very difficult for a government to remove popular programming. Such a move would be highly unpopular, and people who really want it, he said, will find some other (usually illegal) way to get it.

Mr. Oleynik added that if the US did impose trade sanctions against the Bahamas, the issue would go to the World Trade Organisation for an official ruling on the legality of the country's compulsory licensing scheme. It the licensing was deemed legal, the US would be required lift the sanctions.

But the MPA claims to have made an effort, and is looking at ways to legally provide programming to Cable Bahamas and other cable companies in the region. According to the IIPA report, the organisation is compiling data on the pay television market in the Bahamas and other Eastern Caribbean countries so member studios and other programmers can decide individually whether they want to service that market.

The MPA is also reportedly researching legal issues "that complicate the ability of film producers to authorise TV distribution to territories outside the United States," although no-one from the organisation would explain what the problems were.

And the threats continue, cable operators say.

"Just the other day, Turner sent out a cease and desist order," Mr. Ewing said. Despite the MPA's pledges, he is not confident the situation will change anytime soon.

Tomorrow: How the Bermuda Government is approaching Bermuda Cablevision's licensing problems.