For a complete look at the United States Code, Title 17 and specifcally section 107 that governs this philosohpy in the USA:
Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include -
(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
(4) the effect of the use upon the potential market for or value of the copyrighted work.
The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors.
For a law, this is a rather few words to cover such a huge topic that has spilled so much virtual ink on so many mailing lists and discussion pages. I would highly recommend grabbing the above link for some commentaries that are also listed in the formal US Code which take these ideas to much more depth and give some historical background on the issue.
One thing that should be of particular note is that in spite of the fact that the Wikimedia Foundation (and the various Wikimedia sister projects are strongly implied to fall under this umbrella) is an "official" non-profit charity, there is a general attitude to permit commercial reproduction of Wikibooks. Or at least substantial effort shouldn't be made to try and prohibit commercial reproduction. This is something that perhaps I should elaborate upon in a future blog post.
Another very common misconception is that because much of what Wikibooks does is oriented toward textbook publication, that content included on Wikibooks falls under the educational fair-use exception. If you read very closely the law as it is written above, the educational exception is meant for individual instructors and specific lessons taught in an individual classroom setting. I have seen both textual content and images that use educational fair use as the justification, but it really doesn't apply.
There is an interesting Wikibooks policy of "no original research" that is at first glance seems a little bizzare if you don't know the background of this policy. Again this will be the topic of a future blog post, but how that applies to fair use is that the research exception simply won't apply either.
So the only real area that Wikibooks can justify fair use is through the provisions of criticism, comment, and scholarship. There is an additional Wikibooks policy/philosophy of trying to maintain a neutral point of view that significantly restricts critical commentary, but it could be argued that there is a narrow scope where this may still be possible. Most of what actually happens on Wikibooks is mainly scholarly synthesis of non-fiction ideas and topics into textbooks and other educationally oriented multi-media content. So this is where even in the USA fair use applies to Wikibooks content.
There are at least three major schools of thought on this issue, and I'll try to cover them here:
- Ban Fair Use Etirely - The primary argument here is that Wikimedia projects are based upon the GFDL, and we should be using images that are as free if not more so than the text we are writing that goes along with the text. If it is a fair-use image, there are many countries in the world that simply don't permit fair use at all and republishing something like a Wikibook won't be possible in many countries, at least as displayed on the main website with its images and other content that might be claiming fair use. At the very least, in these places where fair use is illegal, the content would have to be heavily edited to keep the fair use in there. A side argument is that the whole of the content ought to be considered available under the GFDL, not just the text itself. Fair use and restrictive content such as images allowed for non-commercial use only would violate this fundimental principle.
- Allow All Fair Use -The main attitude here is mainly, if it is legally permissible for us to have the photos, there is no reason why we should not have it on our projects. An interesting side argument with this is that the GFDL applies only to the text of Wikimedia projects (Wikipedia and Wikibooks in particular) Clearly images other than those under the GFDL are allowed on Wikimedia projects, in particular those under the Creative Commons license. The GFDL does have an aggrigation clause which attempts to deal with this situation on a legal basis. The full quote of that is here:
A compilation of the Document or its derivatives with other separate and independent documents or works, in or on a volume of a storage or distribution medium, is called an "aggregate" if the copyright resulting from the compilation is not used to limit the legal rights of the compilation's users beyond what the individual works permit. When the Document is included in an aggregate, this License does not apply to the other works in the aggregate which are not themselves derivative works of the Document.
This school of thought views since the image files are stored seperately on Wikimedia servers, that the aggregation clause applies and that the text is completely independent of any images, or even the main project HTML code. Of course, fair use content does need to have a context where the fair-use rationale applies, so this isn't entirely the best argument even for this school of thought. Still, it completely isolates the Wiki markup text from the images themselves as areas of separate consideration.
- Keep Fair Use Limited -This is admittedly a compromise and pragmatic solution to deal with advocates of either of the above two schools of thought. And it should be pointed out that the degree of limited fair use is debated even among those who would seek to put any limits on fair use at all but still permit it. The primary arguments in favor of this viewpoint are that some topics can't be written at all unless some form of fair use is permitted. Textual fair use is one specific example where the idea isn't controversial yet is a clear demonstration of where fair use may be used. Some other areas that are generally considered acceptable and widely used in commercial publications with fair use rationale under limited set of context is with the use of national symbols (like flags and seals); corporate logos; and legal tender like bank notes, stamps, and coins. Some Wikimedia projects have even codified fair use policy to only include these sorts of images and nothing more. By making the number of exceptions very limited, it makes it easy to decide if an image really does fit as a fair use image or not, and keeps projects from having to watch the news for changes in copyright laws that will likely not change or restrict these sort of items. In addition, while fair use is generally an American law concept, many other countries around the world have similar laws that permit these much more restricted categories of images without having to pay royalties or be found to violate copyright.
I'll be honest that I support the much more restrictive fair use philosophy, but still want to have some images like flags of countries (often copyrighted!) in a Wikibook that I am writing.