Copyright in the digital single market – harmony and disharmony for copyright exceptions


Copyright provides rightholders with various exclusive rights over their works, such as copying or communicating them to the public. It also provides for various exceptions, allowing an individual to perform certain acts without first having to obtain the rightholders permission. These exceptions provide an important counterbalance to ensure the market remains competitive and to achieve policy objectives such as education and research. Any such exceptions also need to be appropriate for the digital age.
This article will discuss the harmony and disharmony between the EU and UK’s approach to exceptions and the possible impact of Brexit.
Harmony: Proposed Directive on Copyright in the Digital Single Market
On 14 September 2016, the European Commission published its communication unveiling a proposed Directive on Copyright in the Digital Single Market. You can read our bitesize summary of the proposals here, and our views on two of the key proposals made by the Commission (the creation of an ‘ancillary right’ for news publishers, and the creation of a monitoring obligation for video sharing platforms) here and here.
Articles 3 to 5 of the proposed Directive requires member states to provide three new mandatory exceptions to allow limited use of copyright material without permission of the rightholder. This is in contrast to the previous directive under which most exceptions were optional and fell to member states to choose how and if to implement them. The mandatory nature of the exceptions, some of which include new aspects to address the changing use of digital technologies, is to counter the negative aspects which have arisen from the piece-meal implementation of the optional exceptions to date.
The exceptions provide that:
• Text and data mining: certain research organisations can reproduce and extract information from databases when carrying out text and data mining of works and subject-matter to which they have lawful access for the purposes of scientific research.
• Digital and cross-border teaching activities: for the sole purpose of illustration for teaching, digital use of works or subject-matter is allowed to the extent justified by the non-commercial purpose achieved. This must be on the premises of an education establishment or through a secure electronic network, accessible only by the educational establishment’s pupils, students or teaching staff.
• Preservation of cultural heritage: cultural heritage institutions can make copies of any works or subject-matter that are permanently in their collections, in any format or medium, for the sole purposes of, and to the extent necessary, for their preservation.
By harmonising these three mandatory exceptions, it is intended to bring about legal certainty, in particular for digital and cross-border technologies. It is the European Commission’s view that without this level of harmonisation, “the Union’s competitive position” will be at risk (recital 9). Member states will still have some lee-way with the “modalities of implementation” provided that they “do not hamper [their] effective application” (recital 17). The previous exceptions, to the extent not altered by the proposed changes, will remain in force and sit alongside these new additions and adaptions.
The proposed exceptions are in line with the results of two prominent, government-commissioned reviews of UK IP law, The Gowers Review in 2006 and The Hargreaves Report of 2011. These reported that various copyright exceptions needed implementing or updating for the digital age, including: text mining to encourage non-commercial research and analytics; educational exceptions to allow for remote learning environments; and preservation exceptions to develop a digital archive of social, cultural and economic value.
Disharmony: Private Copying Exception
Many of the remaining exceptions are optional: Member States can decide whether to implement them or not. Should they do so, many also require that a scheme of ‘fair compensation’ to rightholders is established alongside to ensure that the exceptions cause them no more than minimal harm.
Article 5(2)(b) of the InfoSoc Directive provides a non-mandatory exception for private copying, allowing individuals to make copies (on any medium) for private, non-commercial use. That copy may also take place across mediums through format shifting, for example copying a music track from a CD to a file on your phone.
The UK did not initially introduce the private copying exception. The Hargreaves Review in 2011 identified this as an obstacle to UK copyright law being up to date with technological changes and innovation. It recommended that a limited private copying exception be introduced to match current consumer expectation (and actual behaviour): e.g. that it’s perfectly acceptable to format shift music files to allow use on multiple devices.
In October 2014, the government made a number of changes to its copyright law, including a provision allowing for digital copies to be made of works such as music, e-books and films for private use. Importantly, and indeed fatally, they did not introduce a corresponding ‘fair compensation’ scheme. Most Member States provided for this by way of levies charged on blank CD’s, DVDs etc., though the size of such levies, what they applied to and how the revenue was to be used is greatly varied. The UK government took a different view and questioned what actual harm rightholders experienced as a consequence of this exception. It argued that the minimal harm endured was already addressed in the price charged for their content: it was “priced-in”.
Following a successful judicial review brought by the the British Academy of Songwriters, Composers and Authors, the Musician’s Union and UK Music, this exception was repealed. It was found to be unlawful under the Directive due to insufficient evidence to prove that pricing-in provided fair compensation to rightholders.
Brexit: harmony and disharmony
It seems likely that Brexit will provide an opportunity for a divergence from EU law. Whilst the ‘Great Repeal Bill’ evidences government’s current intention to implement current EU law as UK law on the point of Brexit, it also indicates an intention to scrutinise such EU-founded laws in due course to determine whether they should be retained, amended or repealed (see our discussion of the Bill here).
It will take some time for the Commission’s proposals regarding the exceptions to copyright to be considered by the European Parliament and Council before they can be adopted. By the time the member states would be required to transpose it into national law, the UK will likely have left the EU. However, regardless of what form Brexit will take, the previous reviews of UK copyright law by Hargreaves and Gowers suggest that the that the UK will want to implement these exceptions (or something similar to them).
The UK seems amenable to adopting the proposed exceptions, regardless of which approach it takes to Brexit (and whether or not it will be required to do so). Not only do the reports suggest these are positive changes to update UK law, harmonisation assists with cross-border technologies and the creation of a digital single market.
However, the private copying/format shifting exception is more disharmonious with the UK government’s approach to date. The reports both supported the implementation of a limited private copying/format shifting exception, to clarify the position and bring the law into line with consumer behaviour. This exception is clearly more controversial than the not-for-profit, educational and non-commercial exceptions discussed above. The government was unable to introduce their exception due to the constraints EU law imposed. Under Brexit, it is possible this exception will be revisited.