Copyright reform is on its way (KOAN Law Firm)
Date of publication: 14/09/2018
After months of heated debates, the European Parliament agreed last Wednesday on a common position on the reform of the Copyright in the Digital Market directive. The aim of the directive is to modernize copyright and adapt it to the challenges of the digital age.
The reform led to extensive discussions and lobbying from content creators, (traditional) media, entertainment industries and big tech companies such asFacebook and Google. In particular, two articles of the directive gave rise to significant controversy: articles 11 and 13. However, these are not the only interesting elements of the new directive (read “What else is new?” below).
New neighboring rights for press publishers
Article 11 creates a new neighboring right to protect publishers of press publications for digital uses of their content. Neighboring rights aim to protect interests of persons and companies that themselves may not create copyrighted works, but nonetheless contribute to their creation and distribution. Examples are broadcasting organizations, producers of sound recordings and performing artists. Their neighboring rights compensate them for their investments and contributions in the making of copyrighted works.
Somewhat similar to broadcasting organizations, press publishers play an important role in the distribution of articles created by journalists. The new neighboring right would grant press publishers protection against the use of snippets, short extracts of articles appearing on services such as Google News or on a Facebook feed. The newly created right entitles publishers of press publications to claim fair compensation for such digital use of the articles they publish. Article 11 has been received with great enthusiasm by press publishers, who consider the new neighboring right as necessary to ensure strong and independent journalism. However, critics state that its adoption will lead in the installment of a form of “link tax” and therefore hinder freedom of information and expression online. The Parliament tried to solve these issues by amending the original text and expressly stating that the neighboring right shall not prevent legitimate private and noncommercial use of press publications by individual users, nor does the use of mere hyperlinks.
Furthermore, article 13 give birth to new obligations for operators of some online sharing platforms (e.g. YouTube) as they are used to share content copyright-protected content without the permission of the copyright owners. Therefore, new obligations are imposed on these platforms operators : mandatory licensing agreements with copyright owners and installation of content recognition technologies.
What else is new?
Aside from the two articles mentioned above, which are the subject of extensive media coverage, several other provisions of the directive deserve a closer attention. For instance, article 3 creates a unified exception to the copyright protection for the purpose of text and data mining. The scope of the exemption is limited to research organizations. Therefore, several companies, for whom data and text mining is crucial to offer their services, will still have to acquire licenses from copyright owners to continue their activities or fear infringement actions. Given the practical difficulties, critics regrets the limited scope, especially in comparison with several other countries (e.g.US) in which text and data mining are considered as ‘fair use’ and cannot be prevented by copyright owners.
By the end, the directive wants to promote fair compensation for authors and performers who have licensed or transferred their rights to another party. It does so by increasing transparency : it ensures the reception of regular information on the exploitation and generated revenues of their works. Based on this information, it becomes clear that the agreed compensation of the author is too low compared to the revenues generated by the licensee or right holders. To illustrate, if an author writes a song and transfers his rights to a producer for a fixed amount of 5.000 EUR and the song turns into an unexpected success generating millions of income for the producer, the author will be able to request additional compensation even if his contract with the producer did not foresee such possibility.
What is next?
The vote by the Parliament triggers the start of the next step in the legislative process: the trialogue between the Council, Commission and Parliament. The negotiations between these bodies will likely continue to attract significant interest from all involved parties, including arguably two of the most impacted players, Google and Facebook. Keep an eye on our website and social media for further updates on this topic. Do not hesitate to contact us in case you have any further questions about the copyright reform process.
With thanks to Naomi Capelle for her contributions to writing this article.