From October 2016 to March 2017 the team is joined by Guest Kats Rosie Burbidge and Eibhlin Vardy, and by InternKats Verónica Rodríguez Arguijo, Tian Lu and Hayleigh Bosher.

Thursday, 11 December 2014

Google announces end of News in Spain

IPKat readers will remember that last year Germany introduced an ancillary right that grants press publishers the exclusive right to exploit their contents commercially for one year, thus preventing search engines and news aggregators from displaying non-insignificant excerpts of newspaper articles without paying a fee. 

As explained here, the German initiative was aimed at recouping some of the revenues that traditional news publishers have lost to the web. The underlying idea was also that news aggregators like Google News would not really boost visits to newspaper websites, but rather have a substitution effect. 

What however happened the very day the new law entered into force was that Google News became opt-in in Germany, with a number of major publishers announcing their intention to waive [this is an important detail: keep reading!] their ancillary right, and thus be indexed by Google.

Leaving now Germany for milder climates, a few weeks ago Spain passed its major IP reform [discussed here and here]. This is due to enter into force on 1 January 2015. Among other things, as previously announced and despite the criticisms of CNMC (the Spanish Competition Authority) that expressed concerns about possible anti-competitive effects, Spain decided to follow Germany on this path, and also introduce an ancillary right over news content.

Bruno was not that hungry,
but had to eat anyway because he has
an unwaivable right to lunch
Unlike the German right, the new Spanish right will be "irrenunciable y se hará efectivo a través de las entidades de gestión de los derechos de propiedad intelectual" (Article 32 of the Ley de Propiedad Intelectual, as amended). This means that the right cannot be waived and requires those who wish to display non-insignificant excerpts to pay a licence fee.

So basically, unlike their German counterparts, Spain press publishers would not be able not to license their contents without also getting a fee, even if they wanted to. 

Anyhow, the interesting piece of news is that yesterday Google announced that as of 16 December, Google News will be no longer available in Spain. Apparently this is the first time globally that Google will shutter its News service. 

As explained by Richard Gingras, Head of Google News, "[t]his new legislation requires every Spanish publication to charge services like Google News for showing even the smallest snippet from their publications, whether they want to or not. As Google News itself makes no money (we do not show any advertising on the site) this new approach is simply not sustainable."

While a decision of this kind is certainly available to a tech giant like Google that provides its services on a world-wide basis, would the same be true also for smaller, Spanish companies or start-ups that wished to enter or remain in the Spanish news aggregation service market? Or, rather, will the Spanish initiative have the side effect of pushing them out of the market tout court?

This Kat ignores the reasons why Spanish Government decided to make the ancillary right unwaivable [so any hints from Spanish readers are very welcome], but overall is not particularly impressed with this move. In particular, it would seem that the way the new right is tailored may be in contradiction with one of the basic principles of private law, notably the principle to contractual self-determination. This Kat is by no means an expert on Spanish private law, but she recalls from her early days as a law student in Florence that a basic distinction is the one between rights that can be waived and rights that cannot. The latter include rights like those pertaining to one's own person (so called subjective or personality rights), while the former tend to include all those rights having an economic dimension, like property and intellectual property rights. 

... Not
it seems
In addition to strictly legal arguments (which may possibly look not-so-sexy to policymakers), wouldn't have Spanish publishers been better off if they had been left with the possibility to decide whether to exercise or waive their right to an "equitable remuneration" for the display of their contents? 

Besides the economic data about website visits and whether news aggregators actually drive traffic to or away from newspaper websites, it would seem sensible to leave rightholders the choice as to how their contents could be found and exploited over the internet. This Kat learned recently that a simple technical trick to avoid having your content indexed on, say, Google Search is to use robots.txt.

In any case, the story with news aggregators is not over. Besides press publishers arguing in favour of the introduction of rights similar to the German and Spanish ones also in other EU Member States, eg Italy, IPKat readers will remember that one of the first moves of new EU Commissioner for Digital Economy and Society, Günther Oettinger, was to state in interviews with German newspapers that it may not be a bad idea to charge Google for "tak[ing] intellectual property from the EU and work[ing] with it". 

Spain and German go global (or at least EU-wide)? We'll see ... Stay tuned!


Anonymous said...

"This Kat ignores the reasons why Spanish Government decided to make the ancillary right unwaivable"

I think that the reason here may well be that the minister in charge is generally recognised to be an utter imbecile who couldn't find his own backside with outside help...

Michel Olmedo said...

On the matter of the unwaivability of the right, there is no "official" reason for it, other than ensuring that every subject is able to collect a sum, according to the use of the content.

In reality, the impression most scholars and practicioners have is that the law has erased any chance of opting-out to avoid having the same problems that collective management societies have had in recent years when trying to collect from, for example, nightclubs using music licensed under creative commons or any other alternative license.

What is most likely to happen is that many services will cease offering their services in Spain (as the applicability of the law remains national only), with Google being only the first one. If we look at the international situation we can see that, with the exception of Brazil, almost every country that has approved a similar provision, has either backed off or seen the operators opt-out of the system. In Germany, Axel Springer recently granted a free license to Google so their publications get back into Google News; in Belgium, after the Courts ordered Google to stop indexing the french-writting publications, the publishers of those newspapers and magazines reached an agreement with Google to get re-indexed and, in France, the threat of a similar measure prompted Google and the publishers to reach an agreement to establish the "Digital Publishing Innovation Fund". In a similar way, many linking sites (seriespepito or and video playing sites (magnovideo), have ceased operating or announced huge changes in their platforms to comply with other provisions of the law.

Now the ball is in the court of the collective management societies, the other news aggregators and the Government, so it's time to wait for their opinions about this decision from the Mountain View giant.

Anonymous said...

Could the licence fee not be €0.01 per year?

Ernie said...

As Michael Olmedo says, an unofficial reason is to enable every subject to collect a sum, and specifically to avoid the possibility to opt-out of the system ensuring that operating aggregators will have to pay a fee.

The (also unofficial) purpose of this reform was to oblige the aggregators -like Google News- to pay a fee because, somehow, the "Asociación de Editores de Diarios Españoles" convinced the Government that aggregators were using their copyrighted content without permission, as they were "making available to the public" their work and therefore the aggregator was a) violating their copyright and b) profiting from their work while preventing visitors to read their contents on their web pages (I'm serious here, that was one of the arguments). Also, they somehow convinced the Government that the only way to repair the "damage" done by Google News and other aggregators is to receive a compensation from that copyright infringement.

The question is that, in fact, they wanted Google to stay and pay. The Government even called this provision "The Google Tax" (see here, in Spanish, After that announcement, the Minister Mr. Wert said that a development rule for the "Google Tax" provision (article 32 of the Intellectual Property Law) is now planned, and operators could reach an individual agreement with Google. This is just absurd, bearing in mind that unwaivable economic rights in Spain are managed by copyright collecting societies.

The reason behind (once again, an unofficial one) is that they don't care about copyright: they care about money. And they though that Google was going to pay just "because the law says you must pay". And this is not the way the laws are made.

Javier Ramirez said...

I believe that Spanish law is simply legally wrong.

First, there is no legal justification under art. 5.2 or 5.3 of the Directive to provide for an exception to the exclusive right of reproduction (nor to the exclusive right of communication to the public … whilst in this case there is not such right of communication to the public in accordance with recent doctrine of the CJEU on the “new public” in cases Svensson and Bestwaters).

And secondly, imposing that such remuneration cannot be waived by publishers has not either any legal justification. I would say that it goes against Art. 17 of the Charter of Fundamental Rights (right of property), which protects not only the right to own, but also to dispose of your property. And in my view, this includes the right to not charge anything for the use of your intellectual property. Furthermore, it should not be forgotten that since Dec 1 2009, with the entry into force of the Treaty of Lisbon, the Charter has the same binding value as the EU Treaties.

Unfortunately, this is not the first time that a similar provision limiting the possibility to waive a compensation / remuneration is unjustifiably provided in the Spanish legislation. A similar provision has been contained for years in art. 25 in connection with the right of fair compensation for private copying by authors and artists. I believe that this is a wrong application of Luksan jurisprudence (Case C-277/10), under which the CJEU provided that holders of the right of reproduction are entitled to directly and originally receive the fair compensation and it is not allowed to presume transfer to producers of the compensation that corresponds to authors (in that case a director, as author of a film / audiovisual work).

Such jurisprudence, however, does not imply that the author and/or artist cannot waive to receive any compensation for the private copying of their works and performances. Otherwise, “creative-commons licenses” would be prevented. What are the practical implications? For example, under such provision in art. 25 and art. 32.2, Creative-Commons licenses may be prevented because if an author cannot license his work for free and cannot waive the fair compensation, then any waiving on his side might well imply that collecting societies would receive the fair compensation income and retain it (inasmuch as authors waived such non-waivable compensation, will not undertake any step to receive any money for that). Does it seem fair from an IP policy to impose those restrictions on the right to dispose of your own property? Do not think so. And it is not complaint with EU law either, in particular with the Charter of Fundamental Right.

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