Some contests forbid the use of dubbed (localized) anime in competitions because of copyright issues. Are there different rules for content in Japanese (usually ripped from airing)? Is there an explicit or implicit agreement between organizers and copyright holders of Japanese works, or it is permitted by the copyright laws?
This is actually a legal gray area. Typically, since nobody's making money of of them, the copyright holders don't usually pursue the claim. But it is ultimately at the whim of the copyright holder. The conventions typically get permission from their sponsors to do AMV screenings, the content show is usually owned by at least one of the sponsors. As they see it, it's free publicity for them at the convention.
Typically AMVs don't qualify as fair use. Though it is highly debated, you will most likely risk getting into legal trouble with copyright infringement if you attempt to use a fair-use defense.
Fair use allows someone to use copyrighted material for certain purposes where its use cannot practically be avoided. For example, if you review a movie, including a few very brief clips of the movie can generally be fair use, because it's difficult to review something without giving the readers a frame of reference. Here the copyrighted material is used to illustrate a concept or idea. This concept can also be applied to content used for educational purposes such as a supplement to lessons being taught in a class. Additionally, protected forms of free speech might unavoidably use or make reference to copyrighted materials, as when a political action group wants to make a point about an undesirable candidate and prepares a parody of his own campaign commercials. Note that most parodies recreate material and don't copy it wholesale.
Ultimately the decision is up to the copyright holders according to the Digital Millennial Copyright Act.
Here's Funimation take on this, from their copyright specialist Evan Flournay:
"For elements of media that are owned by more than one party, such as the underlying animation, enforcement usually falls upon the party with rights for that territory where such use takes place. Regarding AMV's and fan videos, we don't mind most fan videos, including AMVs. The main reasons for this are that they can often serve a promotional purpose, and legally, they can sometimes constitute Fair Use. The basic thinking going into fan videos is thus: if it whets the audience's appetite, we'll leave it alone. But if it sates the audience's appetite, it needs to come down. Does that make sense?"
Evan Flournay's personal belief is that AMVs should be considered fair use, but that's his legal opinion; and if he decides that a video that includes his intellectual property is not worth taking down, it's within his legal right as the content owner to do so.
Each copyright holder might have their own right view of their legal right, some might turn the other way, others may encourage it (because they are), while some just don't like it at all.
No matter what license standing of a copyrighted work, all copyright violations are persecuted only on demand of the affected entity (or entity acting on their behalf and request, e.g. BSA acting on behalf of software manufacturers.)
That means: no complaint = no lawsuit. The copyright holders are fully within their right to sue the fans for statutory damage. But (unlike with trademarks) they are completely free to ignore the violation, acknowledge it or even express approval without issuing actual license - they may choose not to sue, and they usually do.
There are many reasons, not the least of them being suing your own fan base is a really terrible marketing move.
Besides that, these videos are not damaging for the brand (so no way to find proportional damages as none happened) and are not released for profit (so no royalties to sue for.) They can be only sued for statutory damages and even if that provides actual profit outweighing the hassle, the damages to reputation for alienating the fan base will be far worse than the financial profit.
And in the end, these videos are frequently a free marketing of their franchise. They actually bring profit by attracting new fans, new customers. So why fight something profitable?
In essence, the authors and studios choose to let the fans get away with the copyright violations.
The case is somewhat different in case of trademarks. A trademark that is not actively defended is at risk of being lost. Studios sometimes "regretfully" send Cease&Desist letters to fans who, say, produce games that feature trademarked titles. Studios with more competent lawyers choose a different avenue, issuing a limited license allowing these fans to proceed with an official blessing. They can't afford to let the issue "pass under the radar" as is the standard in case of copyright. They must act one way or another, permit or decline, they can't ignore it.
As unpopular as this is likely to be... AMVs at US-based anime conventions are fairly flagrant copyright violations. They are clearly derivative works, using the artwork of an anime to either summarize the story or create a different story from the original work.
The American copyright law summarizes this fairly clearly:
A “derivative work” is a work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted. A work consisting of editorial revisions, annotations, elaborations, or other modifications which, as a whole, represent an original work of authorship, is a “derivative work”.
(On a side note... yes... this is the reason fansubs are violations as well)
Unlike what several people here have said, copyright is NOT limited to civil law (the type of law where the copyright holder is the one who has to bring a case against the offender). Both the Copyright Act and the DMCA have established criminal penalties for cases of 'willful copyright infringement'. This does mean that it is possible for law enforcement to investigate, arrest and prosecute copyright violators without the involvement of the copyright owners. From a practical perspective, this would be very difficult, since law enforcement needs to know if some type of permission has been given. (and this type of investigation is usually limited to mass importers of bootleg DVDs/CDs)
Realistically speaking, however, anime music videos are fantastic advertising for the copyright owners property. We are unlikely to see any type of hostile action against them at any time.
A more realistic problem is the other media being flagrantly infringed upon in an AMV. Unlike the anime, which is typically sliced into small "beat-sized" fragments and rearranged at the whims of the creator, the MUSIC part of the AMV is typically a straight copy of a recording. This violates the musicians song copyright, the recording company's media copyright, AND the public production copyright (owned by who-knows).
Once again, if the song is from the anime, any prosecution is unlikely. For popular American pop songs, however, anime conventions would be well advised to look into obtaining blanket licenses from the major clearing houses. (the same operations that sell permission to bars/nightclubs for 'public performance')
That depends on the country, the convention and the concrete copyright holders, I believe. For example, in USA (and some other countries), there is so-called "fair use". It takes different form from country to country, but in USA, as an example, it works like this (from this wikipedia article):
Notwithstanding the provisions of sections 17 U.S.C. § 106 and 17 U.S.C. § 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.
So in some cases one may actually use copyrighted work without causing an infringement (I think AMVs may fall under "scolarship or research" in some cases, though I'm not a lawyer). I would like to note again, that in different countries this works in different ways. For example in Russia, where I live, such usage of copyrighted material would most likely be forbidden. Also sometimes the organizers of a convention (or contest) may take care of the copyrighted issues for their contestants.
Another important thing is the reaction of those who hold the rights. Some publishers may be strict about the copyrights, and may take some actions to forbid you using copyrighted material. Other are more loyal and will allow you to use the material as long as you are not trying to make profit of it.
A good example for this are youtube videos. Some of them get deleted, some are blocked in particular countries, and some stay there, but have adverts placed on them. I think it is a good example of how different companies take different actions when the material on which they hold rights, is used.