It does not happen often to see European Institutions agreeing on a common strategy. Yet, the strong political will around the need to create a single market for digital content moved this item to the top of the agenda of the European Union since the start of the mandate of the new European Commission at the beginning of 2015. This was reflected in the recent launch of the Digital Single Market Strategy, a series of initiatives aimed at removing barriers and providing citizens and companies with the appropriate online environment to profit fully from Europe's Internal Market.
A key element of the Digital Single Market Strategy is the modernisation of the European copyright law. The entertainment and media industry is among the sectors most affected by the digital revolution. With 7 million people working in copyright-intensive industries and a contribution to the EU's GDP in 2013 of 509 billion euros, the sector has the potential to fully flourish in a harmonised digital market. The Commission aims at ensuring that European businesses benefit from the expected 12.1% increase in spending in this sector around the world in the next five years.
Things are moving fast on the copyright front. While the Commission is working on a legislative proposal, which is expected to be published in autumn 2015, the European Parliament has already started the debate by recently adopting a non-binding report suggesting guidelines on the envisaged binding provisions in the Commission proposal. What is more, the Commission recently launched an antitrust investigation against Sky UK and six major US movie studios for banning broadcasters from showing content outside their country. This development is seen as a first step challenging the principle of territoriality, which until now has been an element deeply rooted in European copyright law.
Those directly affected by the reform are already actively contributing in the discussion and making their voice heard by the Institutions. Are you taking part in the EU decision-making process, shaping the debate on some of the most controversial issues?
- Limitations and Exceptions
- Third-party liability (platforms)
- Term of protection & public domain
Geo-blocking: the territoriality of copyright
Geo-blocking is a barrier affecting cross border e-commerce in the EU by limiting the access or purchasing of products and services from websites based in other Member States. In the creative industries, geo-blocking is mostly the result of the territorial feature of copyright licences and of commercial agreements between broadcasters and producers.
It is seen as one of the main obstacles to the creation of a single digital market in Europe. However, it seems that there is currently a clear political will to tackle this issue. Commission's President Jean Claude Juncker together with Commissioners Günter Oettinger (Digital Economy) and Andrus Ansip (Digital Single Market) clearly stated their commitment to address geo-blocking practices. Likewise, in its non-binding report on the harmonisation of copyright, the European Parliament calls for the Commission to "propose adequate solutions for better cross-border accessibility of services and copyright content for consumers".
One of the challenges will be to differentiate justified from unjustified geo-blocking and to avoid a negative impact on Europe’s cultural diversity. It remains to be seen, however, to what extent the Commission's proposal will move away from the principle of territoriality. Envisaged solutions include maintaining territoriality while ensuring portability of content, and facilitating access to multi-territorial licensing.
Limitations and exceptions
The Commission's proposal will aim at harmonising exceptions to copyright for essential activities such as research, education, text and data mining. Member of European Parliament Julia Reda, the rapporteur of the Parliament's report, highlighted that exceptions "provide creators with the space to create new works […] and access to culture and knowledge for everyone". In this regard, new rules are important to boost innovation and help the work of researchers and educational institutions.
The Commission intends to reduce differences between national copyright rules by means of harmonised exceptions. In this respect, it is considering whether to make mandatory the current optional exceptions under the InfoSoc Directive.
Current copyright rules provide an exhaustive catalogue of exceptions to copyright. It is largely left up to Member States to decide whether they would like to implement an exception into their national copyright laws. In the digital age where copyright-protected works are easily made available cross-border, particularly through the Internet, different exception rules stand as an obstacle in cross-border situations. As a result, the cost of obtaining authorisations in certain Member States which have not introduced a certain exception could prevent companies from offering certain services in these Member States. Moreover, assessing which exceptions apply in another Member State may result in a costly process for the company and ultimately prevent it from offering its products and services in other Member States even if it would be legal.
It is most likely that the European Commission proposal will follow the Parliament's report and ask for mandatory minimum standards for user rights in copyright. Since not all exceptions are bound to be made mandatory, it will be important for companies and stakeholders to ensure a fair level playing field, balancing the rights and business opportunities for creators, intermediaries and end users.
Third-party liability: Further regulation for online platforms?
It is no secret that the European Commission is looking into the e-commerce sector, not only to identify possible competition concerns, but also to collect information on the role of online platforms, including search engines, social media, app stores and price-comparison websites. The data collected through the EU antitrust sector inquiry on e-commerce might be used to justify the need for more regulation.
Among the possible scenarios for further regulation of online platforms, such as Internet giants Google and Amazon, there is the possibility of including a "duty of care" provision for players acting as online intermediaries. This clause would hold platforms liable for third parties' violations of copyright laws, significantly altering the status quo under which intermediaries are not responsible for the content posted by users. Businesses would thus face added costs and obligations.
There has been a push from some decision-makers to regulate digital platforms. Already in April 2015, the governments of France and Germany wrote to Commissioner Andrus Ansip (Digital Single Market) calling for "an appropriate general regulatory framework for 'essential digital platforms'". Moreover, the report adopted by the European Parliament claims that platforms capture a substantial share of the value generated by creative works to the detriment of right owners.
On the other hand, start-ups and other stakeholders fear that further regulation will put a stronger burden on European platforms more than on non-European platforms, hindering innovation generated in Europe. They also claim that excessive regulation could give rise to unintended consequences (e.g. excessive economic burdens, barriers to innovation, …), considering that the term "online platform" does not have a clear legal definition and could include many business activities of different nature.
The Commission is expected to launch an online consultation open to all stakeholders on the role of Internet platforms in autumn 2015, which will investigate - among other things - issues related to access, portability and illegal content.
Term of protection and the public domain
Another proposal which will be discussed within the copyright reform will address whether the duration of protection of a copyrighted work should be shortened, thus reinforcing works in the public domain.
In principle, the EU Term Directive sets a standard term of protection across EU Member States for works of copyright at 70 years after the death of the author. However, this rule is accompanied by a set of exceptions for specific categories of works. Therefore, in practice the desired harmonising effect was not achieved by the Directive, imposing an extra level of complexity when calculating the term of protection in certain Member States. Ultimately this means that a work which is protected in one Member State may be freely available in another, thus creating legal uncertainty for businesses and right-owners. As a consequence, the composition of the public domain differs from one Member State to another, since works fall out of copyright protection on different dates in different EU Member States.
In view of the opportunities that the digital age offers for the online distribution and reuse of out-of-copyright works, the European Parliament's report calls on the Commission to "further harmonise the term of protection of copyright, while refraining from any further extension of the term of protection" and "to effectively safeguard public domain works". Should the Commission in its proposal follow the Parliament's recommendation, this would provide cultural heritage institutions and the average user with more legal certainty in assuring that they are not infringing creators' copyright.
The results of the copyright consultation report issued by the European Commission in 2014 showed that the majority of end users, institutional users, intermediaries and service providers believe that the current term of copyright protection should be shortened. It remains to be seen whether the Commission's proposal will make the identification of works in the public domain easier and less resource-intensive, and thus unlock the cultural, educational and economic potential of the public domain.