On 4 October 2012 the European Council adopted a Directive on certain permitted uses of orphan works. The European Parliament approved the directive with a large majority on the first reading in September and it will become law following publication in the Official Journal of the European Union. Member States will have two years to implement it.

In the official press release, Commissioner Baroness Barnier said "Today's adoption of the Orphan Works Directive is a significant achievement in our efforts to create a digital single market. It will enable easy online access for all citizens to our cultural heritage…. The swift and successful outcome of the legislative process and the broad consensus reached both in the Council and the Parliament prove that by working together we can agree on measures to ensure that the EU copyright rules are fit for purpose in the digital age…..this Directive is one more step in making licensing and online access to cultural content easier."

Currently, digitising an orphan work can be difficult if not impossible, since in the absence of the right holder there is no way to obtain permission to do so. Under the Directive, a work is deemed to be orphan if, after a "diligent" search made in good faith (there are criteria for carrying out the search), it is not possible to identify or locate the copyright holder. Works granted orphan status would then be made public through digitisation and only for non-profit purposes. This would apply to any audiovisual or printed material, including a photograph or an illustration embedded in a book, published or broadcast in any EU country. It would also apply to works not published but nonetheless made available by institutions, provided that they could reasonably assume that the right holder would not object to this act.

The right holder is entitled to put an end to the orphan status of a work at any time and claim an appropriate compensation for the use made out of it. In order to keep compensation payments small, they are to be calculated on a case by case basis, taking account of the actual damage done to the author's interests and the fact that the use was non-commercial. Public institutions will be able to generate some revenue from the use of an orphan work (e.g. goods sold in a museum shop) if it is used to pay for the search and the digitisation process.

Concurrently, the UK is proposing its own changes to the Enterprise Act to allow the use of orphan works. The UK government has said that its proposals are "complementary" to the EU Directive but they are also wider in that they will include commercial purposes and will require the verification of the diligent search by an independent body.