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DSM Watch: One step closer to a European copyright reform

After a long and intense debate – including several postponements – the Committee of Legal Affairs of the European Parliament (JURI) this morning finally agreed on its position on the draft DSM copyright directive. Of course, the plenary is still required to hand down its final vote on JURI’s report. And the trilogue amongst the three legislative institutions is also to follow. However, with today’s vote we are very close to the long awaited position of the Parliament which is the necessary condition for the trilogue to start.

It is fair to say that the debate within and outside JURI has been controversial up until the last minute. Votes have been tight in regard to many provisions. Some parliamentarians have already indicated that they will continue to oppose the now agreed report in the plenary.

What is remarkable is the fact that we see some last-minute provisions that were not featured in previous drafts. For instance, a new Chapter 3a requires the Member States to grant to sport event organizers a sui generis right to the sport events they organize. Obviously, JURI’s report and the Parliament’s anticipated overall position will continue to give rise to plenty of debate.

The story so far

The legislative process we specifically look at here took off in 2016 (COM(2016) 593) as part of the Commission’s Digital Single Market Strategy. The initial proposal included a whole set of individual measures including new exceptions for text and data mining, new negotiation mechanisms and royalty adjustment opportunities, most of which could be agreed upon in the course of the earlier legislation process. However, three measures have been the particular subject of intense scrutiny and comment: Article 3a (text and data mining), Article 11 (a neighboring right for press publishers) and Article 13 (obligations for online content sharing service providers).

The respective issues were not only debated in professional journals and copyright blogs but in general newspapers all over the European Union. Just recently, on 13 June 2018, the Special Rapporteur of the United Nations for the protection of freedom and expression, David Kaye, has weighed in with a comprehensive letter addressed to the Commission outlining his concerns about the compatibility of the upcoming copyright rules with international treaties and requesting a response within 60 days.

Overview of JURI compromise report

In the livestream from the Committee room the tension was already noticeable right at the beginning of the meeting when discussions surrounded questions such as whether there should be separate votes on each amendment and whether oral amendments were permissible. After another postponement was prevented, the vote finally took place.

The final report consists of various compromises between the different political parties. Here is an overview:

 

  • Article 3 and 3a: JURI not only voted in favor of a mandatory exception for text and data mining (TDM) for the purposes of scientific research by research organizations but also for an optional exception allowing temporary reproductions made as part of the process of TDM.

 

  • Article 10a: JURI introduces, for the first time, the idea of a Union Legal Deposit according to which the European Parliament Library is entitled to receive a copy of every publication that deals with European Union-related matters – free of charge. The library shall be obligated to make the copies available for research and scientific purposes.

 

  • Article 11: in a very close vote (13 to 12), JURI decided in favor of a press publishers’ neighboring right that is intended to provide fair and proportionate remuneration for the digital use of their press publication by information society service providers (such as news aggregators). Authors (i.e. journalists) on the other hand would also receive an appropriate share of the additional revenues that press publishers receive due to Article 11. The draft clarifies, however, that this right must not extend to any legitimate private and non-commercial use of press publications, or to acts of hyperlinking. By contrast, with the one year in the EU Council’s draft, JURI’s draft proposes that the right (which should not be retroactive) should last for five years from publication. An oral amendment put forward just two days before the final vote and aimed at excluding insubstantial parts of a press publication (similar to the EU Council’s draft) was not put to a vote.

 

  • Article 12: Member States having established a compensation system amongst authors and publishers may choose to introduce a claim for publishers to receive a fair compensation for the uses of works made under a copyright exception.

 

  • Chapter 3a: A provision which has only been introduced with this final report requires Member States to provide sport event organizers with a sui generis right to their sport events. This builds on the European Court of Justice having emphasized that sport events have a unique and original character which is worth protection (CJEU, judgment of 4 October 2011, C-403/08FAPL). It should be noted that as of today, five Member States already introduced such a right to the benefit of sport event organizers.

 

  • Article 13: Despite multifold criticism, JURI also voted in favor of obligations for online content sharing service providers (15 to 10). The report states that such providers perform an act of communication to the public and that they shall therefore generally conclude fair appropriate licensing agreements with the right holders if they assume an “active role” in giving online access to the content. If this is the case, the provider must take appropriate and proportionate measures to ensure the functioning of the agreement entered into with the right holder.

Even though the report does not mention upload filters, measures other than such filters but still fulfilling the requirement are very hard to imagine. In this context, the report states that – in light of the safe harbor provided by Article 15 of the E-Commerce Directive – Member States may not impose a “general obligation” on online content sharing service providers to monitor the information which they transmit or store.

Additionally, providers are asked to set up systems by which users can file a complaint regarding the application of a copyright exception or limitation which has to be handled effectively and expeditiously.

 

  • Article 13a: Another provision which has not been widely discussed before is Article 13a which shall obligate information society service providers providing automated image referencing (i.e. image search engines) to conclude fair and balanced licensing agreements with any requesting right holder. The remuneration is to be managed by collective management organizations.

 

  • Article 14a to 16: JURI also voted for various provisions that improve transparency and fair remuneration for right holders. Further, there shall be a contract adjustment mechanisms for cases in which the remuneration originally agreed upon is disproportionately low compared to the subsequent revenues. A right of revocation for the authors and performers shall be introduced in case of absence of exploitation of the work or continuous lack of regular reporting in light of the transparency provisions.

 

Outlook

One does not need to like what JURI has come up with. Also, it seems a fair comment that not all the compromises reached in the adopted report are thought through right until the end. Particularly, Article 13 forms a complex provision which is not easy to implement in practice. Apparently, JURI aims to create a new alternative as to what forms a communication to the public beyond what the CJEU has ruled on the basis of Article 3 of the InfoSoc Directive. It is not yet clear what this means in the long run.

Looking forward, it is not unlikely that the now adopted report will eventually also be the plenary’s position. However, it will be yet another tough debate. Julia Reda, Member of the European Parliament and the JURI committee, has already announced that she is going to challenge the report in the plenary. To do that it will take 79 votes to trigger a vote on the report by the full EU Parliament.

Either way, at some point the Parliament will have to enter the trilogue negotiations with the Council and the Commission on the draft legislation. On 25 May 2018, the Council already agreed upon a General Approach to the new copyright directive and despite many similarities in the basic concepts, the details are likely to make the trilogue as interesting and controversial as the legislative process has been so far.

The copyright directive will cover a variety of rules and therefore its impact is going to be huge. We will continue to have a close eye on the trilogue and keep you up to date.