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SWD Impact assessment on the modernisation of EU copyright rules – options to achieve the objectives (option 2)

Application of country of origin to the clearing of rights for broadcasters’ online services ancillary to their initial broadcast

Introduce a rule providing that as concerns the licensing of rights for certain online transmissions by broadcasting organisations, the copyright relevant act takes place solely in the MS where the broadcasting organisation is established. As a result, in order to provide certain services in the Union, rights would only need to be cleared for the “country of origin” (CoO) of the broadcasting organisation (and not for the countries of reception).

The CoO rule would enable broadcasters to provide services across borders but it would not oblige them to do so (this option would not entail any rules limiting the contractual freedom of broadcasters and rightholders). The application of the CoO rule and the contractual freedom of broadcasters and rightholders would be subject to the application of the Treaty as well as to the applicable secondary law (notably, as regards the freedom to provide services).

The licence fee payable to rightholders would have to take into account all aspects of the online transmission of the broadcast, including the audience, unless agreed otherwise with rightholders. The Commission would put in place a monitoring mechanism to assess the cross-border availability of broadcasters’ online services covered under this option.

All public service broadcasters and commercial radios support this option. Commercial TV broadcasters are generally against this option due to the fear that, considered together with the application of the free movement of services principle and competition law, it may lead to the weakening of territorial licensing or even to mandatory pan-European licences. They argue that this, in turn, would limit possibilities for smaller broadcasters/ broadcasters operating in smaller markets to obtain licences in premium AV content, as rightholders, without exclusivity guarantees, would focus on the largest/most lucrative markets.

Other service providers than broadcasters call for a cautious and well-measured approach, ensuring a level playing field. Rightholders and CMOs are against such option for similar reasons as commercial TV broadcasters, underlining that this may undermine incentives to invest in AV production. They also raise a possible risk of establishment shopping and of disaggregation of repertoire. Consumers’ representatives support the application of the CoO rule to broadcasters’ online transmissions.