The discussion of “fan fiction” at Wikipedia begins as follows:
Fan fiction (alternately referred to as fanfiction, fanfic, FF, or fic) is a broadly-defined term for fan labor regarding stories about characters or settings written by fans of the original work, rather than by the original creator. Works of fan fiction are rarely commissioned or authorized by the original work’s owner, creator, or publisher; also, they are almost never professionally published. Fan fiction, therefore, is defined by being both related to its subject’s canonical fictional universe and simultaneously existing outside the canon of that universe.
While the problematic legal implications of fanfic should be obvious, there are a multitude of other perspectives and considerable discussion about the propriety of fanfic and whether and how copyright owners should respond to, tolerate or even encourage it.
Jonathan Bailey, writing at Plagiarism Today, has a detailed discussion about “The Messy World of Fan Art and Copyright”. The legal portion of Bailey’s analysis (though Bailey isn’t a lawyer, he writes frequently on copyright-related matters) focuses on US law, and he offers a nice exploration of the various factors (legal, commercial, artistic) which intersect in discussions of fan fiction.
The key point to remember is this: Fan fiction and fan art are, usually, an infringement of the right of the copyright holder to prepare and license derivative works based on the original. This is almost without exception.
However, many copyright holders, for good reasons, tolerate fan art and even encourage it, but this should not be taken as carte blanche to do what you want with the source material. There are many lines that a fan artist can cross and wind up in legal trouble.
Canadian lawyer Grace Westcott published a lengthy and thoughtful article on the topic in the Literary Review of Canada: “Friction Over Fan Fiction”. As Westcott notes:
Under Canadian law, as in the U.S., characters from fiction or television, such as Anne of Green Gables, can be protected by copyright, provided that the characters are sufficiently creative, distinctive, thorough and complete, or constitute a substantial part of the work itself. While the Canadian Copyright Act has no explicit concept of derivative works, it does confer on artists and authors the exclusive right to control the production of their works in other mediums and adaptations. The basic question is whether a substantial amount of the source has been produced or reproduced, in any material form whatever. This would likely capture most fan fiction.
As she also notes, of potentially even greater concern under Canadian copyright law is the presence of “moral rights”: Sections 14.1 and 28.2 of the Copyright Act (Canada) provide that if a work is “distorted, mutilated or otherwise modified” to the point where there is “prejudice to the honour or reputation” of the author, then an infringement of moral rights has occurred.
Other, non-legal, considerations should be taken in account as well, as Westcott notes:
Broader benefits may flow from fan fiction as well. Tushnet argues that fan fiction allows fan writers — and potentially children, too, in an educational setting — to develop their writing skills using their favourite characters and worlds as a starting point. The fan community provides an important social network for this. …
Media companies may judge that the promotional value of creatively engaged fans outweighs the risks of fan fiction.
Canadian author James Bow, who spent his own time in the fanfic trenches, offers his own perspective in “In Defence of Fan Fiction”:
When it comes to the best that fan fiction has to offer, you will find individuals working as hard as any professional, producing something that is well written, well crafted and a lot of hard work. And it has all been done for no reason other than love.
… So this author is not going to shy away from his fan fiction heritage. He will not shoo away the kids from his backyard. As long as they don’t damage the fence or step on my begonias, I’ll be content to listen to their playful chatter. I honestly think that my life and my work will be all the richer because of it.
As with so many current issues in Canadian copyright law, we await a Canadian court’s pronouncement on the legality of fan fiction – but we see, also, that the considerations to be taken into account are not limited to the purely legal.