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Reforming of copyright in EU and considered policy options – options 1 and 2

Option 1 – Status quo

No policy intervention. This option would consist in relying on the market to improve the availability of content online, on Member States to take full advantage of the total policy space available under the InfoSoc and other Directives, and on the courts, and notably the CJEU, to clarify provisions of the Directives relevant to the development of new uses and services.

Option 2 – Guidance to Member States and stakeholders and support for market initiatives

Guidance to Member States could be achieved through a Communication of Recommendation. By doing so, this option would exploit to its maximum extent the current legal framework and support the market in the development of solutions for the use of content online, with a backstop of regulatory clarity. It would recall the principle developed by the CJEU in rulings related to limitation and exceptions, in particular the requirement that the principle of strict interpretation of the exceptions should be balanced against the need to ensure that the interpretation of the conditions of exceptions enables the effectiveness of the exception, and its purpose to be observed.

With regard to territoriality, this option would entail issuing a Communication or Recommendation on the interplay between copyright, territorial exclusivity and the freedom to provide and receive services in the Internal Market, as developed in the case law of the CJEU. Such an instrument could also contain main principles with regard to the localization of the copyright relevant act in cross-border situations (elaborating e.g. on the “targeting” approach). The Commission would build on CJEU judgements and provide guidance on the current legal framework as regards the principle of exhaustion in digital transmissions and how copyright relates to linking and browsing. The Commission would promote and support industry initiatives aimed at streamlining licensing and developing metadata and rights models to enable creators to identify their works, for example by issuing calls for tender to develop tools and technology to support implementation of Web Content Declarations (WCDs). In addition, the Commission could set up a dialogue with Member States and stakeholders to develop national copyright hubs which could simplify the identification and management of right, and support projects to ensure interoperability between them; and design or support initiatives to integrate “orphan works” and public domain registry services and databases with WCDs and the evolving Hub network.

Under this option, the Commission would establish a dialogue with stakeholders and Member States to review in practice the different national approaches to the transfer of rights and the remuneration of authors and performers, including collective bargaining agreements, contractual arrangements (including contractual clauses) and transfer of rights mechanisms as well as management by collecting societies.

The Commission would provide guidance to Member States as to the application of the private copying exception to online services and to address the cross-border aspects of the levy schemes. The guidelines could also clarify the applicability and methods of calculation of levies by laying down criteria necessary to establish in particular which categories of copies made in the context of online services (including cloud-based services) should be taken into account in the calculation of fair compensation. If followed (guidance of Commission) by all Member States with levy schemes in place, it could lead to a reduction of instances of double payments whereby copies made by consumers on their devices in the context of on-demand services are considered to be remunerated via licence and they are not taken into account in the calculation of levies. By recommending making levies visible on invoices, the guidelines could also increase consumers’ awareness, contributing to the transparency and legitimacy of the levy schemes.

To address the problem of low and “erratic” damages, guidance could be provided to courts on how to calculate damages. Regarding the issue of cross-border corrective measures/damages, guidance addressed to Member States could deal specifically with the calculation of damages which takes into account additional costs that might have been triggered by the cross-border nature of the infringement. Member States should be encouraged to set up dedicated copyright chambers in national courts. Judges from these courts should then be integrated into the network of IPR judges at the EU Observatory on infringement of IPRs (“the Observatory”). Dedicated copyright chambers in national courts would result in greater specialisation and expertise of judges. This would help addressing all three problems related to enforcement: Judges could better assess the quality of claims and of evidence provided. Judgements should become more predictable and damages more appropriate to the damage suffered. Furthermore, judges should be able to decide on preliminary measures faster and cases should be solved within a shorter period of time.

Actions under Option 2 would contribute in the short-term to maximising the effect of the current legal framework, notably as to the application of CJEU judgements in the matters of territoriality, rights in the online environment and on the maximum scope of the exceptions and limitations to copyright. They would also contribute to the development of market solutions for the use of content online which could be achieved in a shorter term. However, they may sometimes not be sufficient to address certain issues discussed in this IA. Further clarification of the interaction between copyright and fundamental rights would help safeguard the fundamental rights of customers and citizens in the enforcement of copyright and avoid unnecessary legal disputes and costs.