CEPI has been invited to contribute to the April edition of the Austrian trade magazine Film, Sound, Media with an article on the state of play of the implementation of the Copyright Directive and the adoption of guidelines on article 17 by the European Commission.
Please find below the English translation.
Copyright Directive - rights worth fighting for
2020 was the year when virtual entertainment went mainstream and exposed the influence of online platforms. With individuals staying at home, search engines, social networks and video platforms are now the primary tools for accessing content. This is not without consequences for the audiovisual production industry, and all rightsholders must fight for the protection of their content online and against commercial-scale piracy. Copyright laws are being updated all across Europe, and the industry should keep an eye on them.
In September 2016, the European Commission proposed new legislation on copyright and related rights in the digital single market, designed to update the 2001 European copyright legislation. The objective has been to adapt copyright rules to the digital environment, and in particular to the growing use of online content sharing platforms. This proposal has been at the center of one of the most virulent fights Brussels has ever seen: it raged for over two years, until the adoption of the new law, finally, in April 2019.
Online content sharing platforms get revenues from advertising. The longer users stay on a platform, the more advertisements they are likely to see. To keep users connected and engaged, platforms use algorithms to present users with never ending trails of relevant content. The platforms’ interest is not based on the quality of the content presented on screen, but on the quantity of content shared and made available by users every day. Rightholders whose content is often shared without their permission do not receive fair compensation, while platforms see eye-watering economic growth. Early this year, Alphabet, the Google and Youtube parent company, reported that YouTube ad revenue jumped to $6.9 billion in Q4 of 2020.
The Copyright Directive intends to breach this ‘value gap’ between those who invest in production and those who earn revenues from dissemination. New provisions in the Directive give rightholders better leverage when seeking renumeration from platforms and improve enforcement of their rights on these services. Article 17, the most fought over provision of this Directive, requires Google-owned YouTube, Facebook’s Instagram and other sharing platforms to prevent users from uploading copyrighted materials. For the first time, the law proposes to shift the responsibility for online copyright infringement to platforms. Such substantial progress for rightholders had to be achieved through the crafting of a delicate balance with other fundamental rights, starting with freedom of speech. However, a law is only as good as its implementation and enforcement.
Currently, every EU Member State is going through the difficult exercise of finding the right balance between protection of copyright and freedom of speech. EU Directives have to be transposed into national law, and each Member State has until the 7th of June 2021 to comply. The European Commission is also working on guidelines for Article 17, to help Member States navigate this balance of rights between creators, distributors and users. Unfortunately, both national implementations and European guidelines seem to have difficulties following the adopted balance in the Directive, and this is creating serious concerns for rightholders.
Two main tensions are underlying the copyright discussions: Being able to detect copyright infringing content and properly identifying legitimate uses allowed in the Directive and copyright generally. Rightholders must get these right both at national and European levels in order to be able to benefit from the promise of the Copyright Directive.
For detection, discussions have naturally turned towards the use of automatic content recognition systems, as well as the criteria to be used to detect copyright infringing content. Almost at the end of the transposition process of the new law, Germany is creating a dangerous precedent by suggesting the introduction of a threshold allowing for copyright protected short video and sound content (under 15 second long) to be uploaded. This attempt at applying quantitative criteria to detect content that should be qualitatively assessed would indirectly create a new exception to copyright, further undermine the value of content and risk spreading to other Member States (for example, the Austrian draft proposal). Taking a different route, France, one of the first countries to have implemented the Directive, has produced a report leading the country in the right direction. The Mochon report, while emphasizing the safeguards built into the law to protect fundamental rights such as freedom of speech, identifies content recognition and comparison tools as useful, and finds they will not lead to a significant number of contested decisions. Moreover, their use better reflects the intention of the EU law.
At the same time, the European Commission has consulted various stakeholders over the past year, including CEPI, the European Audiovisual Production Association, to get extensive feedback on implementation guidelines for Article 17. The guidelines seem to focus mostly on the issue of legitimate uses identified as criticism, review, parody and pastiche that do not infringe copyright. As it is not possible to provide conclusive definitions or clear distinctions, the Commission is attempting to provide examples which arguably create more confusion through notions of “manifestly” infringing, and “manifestly” not infringing. However, on questions around “likely” infringing content, as well as burden of proof, the guidelines are likely to leave it up to Member States to decide. An ongoing case at the Court of Justice of the European Union, brought forward by Poland, also risks invalidating the guidelines. The country believes that Article 17 of the Copyright Directive brings disproportionate measures that threaten freedom of expression.
At the editorial deadline of this article, the guidelines are still not published, but echoes from the Commission’s approach continue to raise serious concerns. Not only from rightsholders. 18 former and current Members of the European Parliament, who had fought hard to reach a political compromise on the Directive in 2019, co-signed last December a tribune published in the French newspaper, Le Figaro, (here in English), coming to the defense of rightholders, calling on the Commission to be vigilant, as Guardian of the Treaties, and ensure Member States properly transpose the Directive. In February, yet again, several MEPs reached out directly to the Commission to express their concerns about the direction the Commission is taking.
The different approaches taken by Member States will have consequences on the protection of intellectual property across Europe as well as undermine the audiovisual sector’s leverage to negotiate licensing agreements with platforms. With the fast approaching June implementation deadline, it is difficult to see how the Commission’s guidelines will be able to steer Member States towards a common understanding of Article 17. One can only observe that the fight of rightholders to protect their content is far from over.