Implementation Process Commenced
Likely Amendments to Copyright Law
Future Developments

Implementation Process Commenced

The member states of the European Union should implement Directive 2001/29/EC on the harmonization of certain aspects of copyright and related rights in the information society by December 22 2002. The directive harmonizes some elements of copyright law in relation to features such as certain exclusive rights, and establishes new forms of protection for technological measures and rights-management information. Implementation will require a number of amendments to Finnish legislation, in particular to the Copyright Act (404/1961, as amended).

The Ministry of Education is in charge of the directive's implementation. In July 2001 the ministry published a memorandum discussing the implementation and the amendments likely to result from the implementation process. A related consultation hearing was held on September 14 2001. A working group comprising members of the Ministries of Education, Trade and Industry, Justice, and Traffic and Communications, together with some academics, has been convened to continue drafting the implementing legislation.

Likely Amendments to Copyright Law

Exclusive rights
The directive clarifies and harmonizes the contents of the reproduction right by including in the definition "direct or indirect, temporary or permanent reproductions by any means and in any form, in whole or in part". Further, the directive provides authors with the exclusive right to communicate their work publicly by any means. This right includes the on-demand transmission of copyright-protected works. In accordance with Article 3(2) of the directive, performing artists, phonogram and film producers, and broadcasting organizations will also have the exclusive right to make their works publicly available by way of on-demand transmission. However, the directive is silent on their rights with respect to communication to the public by other means.

Harmonization concerning the reproduction right, the right of communication to the public and the right of making available to the public should not cause substantial amendments to the Copyright Act, as it already complies with these provisions to a large extent.

However, certain clarifications are required. For instance, the rules on the right of communication are likely to be clarified to include clearly all types of communication to the public. In the consultative hearing the users of copyrighted material pointed out that the broad definition should be clarified to state that this means actively communicating material to the public as opposed to, for example, linking to websites containing material placed by a third party. Moreover, as the current provisions on neighbouring rights do not cover on-demand transmission, such rules are also likely to be amended.

The existing Finnish provisions on the scope of distribution rights comply with the directive. However, as the rule on exhaustion of the distribution right in the Copyright Act is based on international exhaustion, the act will presumably be amended to comply with the standard of EU-wide exhaustion required by the directive. During the directive's preparation Finland officially supported international exhaustion, and has required that the matter be re-evaluated in case international exhaustion is considered with regard to trademarks or other IP rights.

Exceptions to exclusive rights
The directive requires member states to provide an exception to the reproduction right with respect to certain temporary copies, as well as other exceptions relating to the reproduction right and the right of communication to the public. These concern, for example, certain temporary reproductions, reproductions for private use and ephemeral recordings.

The mandatory exception concerns certain temporary acts of reproduction "which are transient or incidental, [and] an integral and essential part of a technological process" the purpose of which is either to enable transmission in a network or to enable a lawful use. Due to the absence of such an exception in the Finnish Copyright Act a new exception should be enacted. However, most of the existing exceptions and limitations found in the act are within the scope of exceptions permitted by the directive. Therefore, only minor clarifications are expected with regard to these provisions.

In addition to the harmonization of certain rights and exceptions the directive introduces a new concept to the field of copyright law. According to Recital 35 of the directive rightholders should, in certain cases of exceptions or limitations, receive fair compensation for the use of their protected works or other subject matter. Three of the exceptions to the reproduction right include the requirement for fair compensation. This concept should be distinguished from, for example, the equitable remuneration set forth in Article 12 of the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations, or the single equitable remuneration used in Directive 92/100/EEC on rental rights and lending rights and on certain rights related to copyright in the field of intellectual property. In accordance with Recital 36 of the directive the member states may provide for fair compensation when applying other optional exceptions.

In the ministry's consultation hearing the practical implementation of the concept of fair compensation into the national legislation was discussed, and users of copyrighted materials stated that new or additional levies on equipment duties (eg, levies on blank tapes) should be avoided as far as possible.

Protection of technological measures and rights-management information
The directive requires member states to provide for technological measures and rights-management information against circumvention or tampering. It implements the corresponding obligations in the World Intellectual Property Organization Copyright Treaty and the Performances and Phonograms Treaty and actually goes beyond their minimum requirements. The protection is similar to that found in the US Digital Millennium Copyright Act, but differs in relation to aspects such as the scope of prohibited acts of circumvention.

According to Article 6 of the directive the member states shall provide protection against the circumvention of technological measures designed to protect copyright or related rights, as well as against the distribution and sale of devices designed to allow a user to circumvent these technological measures. The prohibition against the act of circumvention is subject to some measures to be taken by the member states in case voluntary private arrangements with or by the rightholders do not enable users to benefit from the exceptions to the exclusive rights provided for in Article 5. Article 6(4.4) contains a so-called 'e-commerce safeguard clause' to which Finland strongly contributed during the directive's preparation. The essence of this clause is that the terms agreed upon between the rightholder and the user in relation to an on-demand electronic service will prevail over the possibility of the member states to take measures.

The protection of rights-management information includes both protection against tampering with such information, and against distributing or communicating to the public the tampered rights-management information.

The Ministry of Education has proposed that the protection of technological measures and rights-management information might be implemented by imposing criminal sanctions for violations.

Other legislative actions
The Ministry of Education has suggested that other issues of copyright law be evaluated in connection with the directive's implementation. Such issues include the adoption of a notice-and-takedown procedure, which has been included in the proposal of the working group preparing the implementation of the E-commerce Directive. However, the status of possible amendments to the Copyright Act outside the scope of the directive is unclear.

Future Developments

According to the unofficial information received from the Ministry of Education a draft government bill is expected to be circulated for comments in April 2002. This would mean that the final government bill could be submitted to the parliamentary proceedings in Autumn 2002. The government aims at implementing the legislation by the directive's deadline in December 2002.

For further information on this topic please contact Eeva Hakoranta or Kati Määttä at Roschier Holmberg, Attorneys Ltd by telephone (+358 20 506 6000) or by fax (+358 20 506 6100) or by email ([email protected] or [email protected]).