Mandatory exception with a cross-border effect covering digital uses in the context of illustration for teaching, with the option for MS to make it (partially or totally) subject to the availability of licences
Option 3 would have the same positive effects as Option 2 in terms of possibility of use of protected content digitally and online for illustrating teaching, including across borders. Legal certainty for such uses would be ensured either via the mandatory exception, or via licences providing for at least equivalent conditions of use (in practice, licences would probably cover uses tailored to the needs of different types of educational establishments, including uses which would go beyond the exception). For most teachers it is irrelevant to know whether the uses are allowed under an exception or under a licence, as long as the conditions for use are equivalent.
In MS deciding to use the possibility offered under this Option to make the application of the exception subject to the availability of licences, educational establishments would have to pay licence fees for digital uses of protected content (where such licences are available). However, as illustrated under Option 2, data collected from certain MS where educational uses are allowed under a licence or an ECL shows that these costs are rather limited if compared to establishments’ overall costs. Furthermore, licences covering cross-border uses are not expected to be more costly, as they would not extend the number of users (licence fees are generally defined according to the number of students).
In MS opting for implementing the new exception with an obligation of compensation, educational establishments may incur some costs related to compensation. Considering the current level of compensation in certain MS, these costs are expected to be marginal. For example, the compensation required in FR for digital uses of print works is €1.7 million by year, for 14.7 million pupils/students. The negotiated compensation in ES amounts to €3.2 million for digital uses of print works in higher education (covering about 1.2 million students).
The possible transaction costs for educational establishments related to the need to check the availability of licences are expected to be reduced by the measures MS would have to take to ensure the availability, visibility and user-friendliness of licences covering secondary uses of protected content in education. The development of specific educational licensing schemes could for example contribute to significantly reduce transaction costs, even if different schemes may coexist for different types of works. Such schemes would be based on voluntary collective management: interested rightholders would give a mandate to a CMO to license their works for uses in the context of illustration for teaching.
Since these schemes may not fully remove the need for educational establishments to take up individual licences, it may also be necessary for MS to develop online tools allowing to check the licences available for a given work. Certain rightholders may decide not to participate in educational licensing schemes based on collective management; or such schemes may not be developed for certain types of works, for which individual licensing would apply (e.g. AV works, digital textbooks). Licensing bodies increasingly tend to propose online tools allowing to check permitted uses.
Option 3 may also generate administration costs for educational establishments, linked to the negotiation and management of licences. Such costs could be reduced if MS decide to centralise, at national or regional level, the acquisition of licences for educational establishments.
Option 3 would have the same effects on rightholders as Option 2 if all MS decide to implement the EU exception as such. However, the possibility to make the exception subject to the availability of licences is very likely to be used by MS to maintain the mechanisms in place (e.g. ECL in DK, FI, SE and exception subject to licences in UK and IE). It could also be introduced in other MS for certain types of works (e.g. textbooks and educational resources), notably in countries where they are currently excluded from the teaching exception (AT, DE, FR, ES).
Such mechanism would allow to favour licensing for resources which are primarily intended for the educational market, but would nevertheless offer the necessary legal certainty where licences are not available. Under this scenario, the negative impacts described under Option 2 would not materialise under Option 3.
In MS using ECL or making the exception subject to the availability of licences, rightholders would need to give sufficient visibility to their licensing offers if they want to be remunerated for the uses of their works in the teaching context. Rightholders would have to propose specific licensing solutions for secondary uses of their content in teaching activities. This may generate some costs, in particular for SMEs, which are however expected to be compensated by licensing revenues. The need to make licensing solutions widely available and adapted to the needs of educational establishments could encourage rightholders to sign up into specific educational licensing schemes that may be developed by MS. Other rightholders may prefer developing their own licensing solutions online, in particular for digital resources.
The legal mechanism allowing cross-border uses is not expected to have any impact on rightholders’ licensing revenues (as explained under Option 2, licence fees are generally defined according to the number of students, which will remain unchanged) nor to reduce their possibility to licence their works to educational establishments in other MS.
This option is likely to have a limited impact on the competitiveness of the publishing industry, as it leaves to MS the possibility to favour the use of licences over the exception for digital uses in education. MS where the current exception does not apply to textbooks and other educational resources are expected to use the flexibility of Option 3 to make this type of works subject to the availability of licences. This would allow educational publishers to continue investing in the development of digital resources.
Option 3 would have a positive impact on the further development of digital and cross-border education and indirectly on the acquisition of digital skills. It would allow to promote cultural diversity through wider and more flexible uses of protected content in education. In addition, to the extent MS use the flexibility foreseen under this Option to make the resources developed specifically for education subject to the availability of licences, the impact of this option on rightholders is not expected to affect the production of new content.
The impact of Option 3 on the right of property would be mitigated by the possibility for MS to decide that licences prevail over the application of the exception. Option 3 will have positive impacts on the right to education as it will support the further development of distance education.
Option 3 is the preferred option, as it would allow reaching the objective of full legal certainty for digital and cross-border uses in education for the benefit of educational establishments, teachers and students, while limiting negative impacts on rightholders. In contrast, Option 1 would not be sufficiently effective and Option 2 would entail significant foregone costs for rightholders in several MS, with a possible negative impact on the quality and variety of educational resources in the long term.
Option 3 could imply some compliance costs for MS deciding to make the exception subject to the availability of licences, because of the requirement to ensure availability and visibility of such licences. However, these costs are expected to be lower than the compliance costs associated with Option 2 (need for certain MS to thoroughly review the way in which educational establishments make use of protected content in order to implement the exception). Also, such compliance costs from MS would allow to significantly reduce administrative burdens and related transaction costs for educational establishments. Finally, the impacts on cultural diversity and fundamental rights are more balanced under Option 3 compared to Option 2.
Option 3 responds to the policy objective in a proportionate manner, by focusing on uses which have a cross-border dimension (digital uses) and leaving sufficient flexibility for MS to choose the most suitable mechanism (exception or licensing).
The implementation of Option 3 will require certain MS to adapt their national legislation in order to clarify that the exception covers digital uses carried out in the context of illustration for teaching. Other MS, where such uses are already allowed under their national teaching exception, will only need to make more limited amendments to reflect the specific conditions defined under Option 3 (e.g. uses under secure electronic networks, all types of works covered). All MS would need to amend their national laws in order to allow for cross-border uses. The flexibility foreseen for the implementation of the exception will allow MS to maintain to a large extent the existing arrangements (e.g. ECL or exception subject to the availability of licences).