TILTing Perspectives 2017 report (2): The IP session and the Key Note

* This report is arranged in a chronological order.

Panel: New IP Developments 

1. Copyright’s view on libraries in a connected world

Vicky Breemen 
does have an eye for details. She delivered a presentation on a common, yet little-reserched (in this Kat’s view...) subject: libraries. She looked into the concept of “library” and addressed the following legal and regulatory issues: does the present design of the so-called “library privilege” in copyright law sufficiently cater for the current realities of a connected world? If not, how should it be changed? To answer these questions, she scrutinized the issues through a copyright lens, mostly standing on a European point of view but including comparisons where relevant. She examined copyright’s views on libraries from the perspective of an institutional organization, its purpose and functions, in the context of several key EU legal documents (e.g. Rental and Lending Rights Directive, CJEU decision in VOB/Stichting Leenrecht, Copyright Directive, art. 5(3)(n)). 

In conclusion, the study was based on a set of central assumptions, which informed the story explicitly or implicitly. First, libraries and copyright law have partly shared functions and goals regarding the organization and dissemination of information, furthering free speech and culture. Secondly, human rights colour the functioning and role of copyright law and libraries. Thirdly, both copyright law and libraries had responded to technological developments, which in turn shaped their relationship. Fourthly, taking the foregoing assumptions together, the speaker contended that the ‘library privilege’ in copyright law should balance all interests involved, in that sense containing a ‘minimum safeguard’ for all sides. Fifthly, as the privilege needs to be delineated to some extent, she concluded that a combined institutional and functional approach is inevitable in the context of the library privilege’s contours.

2. Portability as a specific category of the conformity with contract 

In 2015 the European Commission presented the first part of the Digital Single Market package which contained i.a. “Digital Goods Directive Proposal”. Although it will not have direct impact on copyright laws and other IP laws, it will strongly influence the contractual relations between the “digital goods supplier”, and the “digital goods consumer (user)”. 

Pavel Koukal addressed a number of questions: 
1) To what extent can EU law regulate intangible assets in the same way as tangible goods (especially when assessing the conformity of the digital content with contract)? 
2) When focusing on the use of the software, in which aspects will the Digital Goods Directive affect the wording of the EULA in EU countries? 
3) What will be the relations between the Portability Regulation and national laws of EU Member states after the transposition of the Digital Goods Directive, especially when we concentrate on duties of the digital goods supplier concerning the accessibility and functionality of the digital content? 

The speaker concluded that it makes little sense to regulate portability issues at the level of an EU regulation and at the same time adopting a directive which governs the same issues (obligations arising from the “conformity of the digital content with the contract” - Art. 6 Digital Goods Directive). If the EU legislation is to be coherent, it would be more sensible that all rules relating to the “functionality, interoperability and other performance features such as accessibility, continuity and security“ [Art. 6 para. 1 (a) Digital Goods Directive Proposal] were contained in the same piece of legislation.

Panel: Collective Management of Copyright 

1. The calculation of private copying levies – How much harm do rightholders suffer from private copying?

Mina Kianfar explored the private levy system that compensates authors for private reproductions of their works. She compared the criteria collective management organizations (CMOs) use for the setting of tariffs, also in light of the Collective Management Directive, with the requirements formulated by CJEU case law following Padawan case. She addressed the question of “whether tariffs provide for a fair compensation that corresponds with the amount of harm rightholders suffer due to private copying”. 

Specifically, in terms of the harm which caused by the making of private copies, Mina summed up five “No”, namely: No harm in the case of licensed online services (since the rightholders have already received a license fee); No harm when technical protection measures are used; No harm in the case of unlawful copies (e.g. illegal file sharing; illegal streaming platforms); No harm in the case of minimal prejudice; No harm when devices/media are sold for professional use. 

While discussing the calculation of harm, Mina covered three aspects, namely: the requirements under Collective Management/Enforcement/Copyright Directive, Guidance from CJEU/AG, and Method of tariff setting by CMOs. 

She also indicated that some basics were not clear yet, which led to the consequence that some substantial discussions could not go anywhere. For instance, the confusions caused by the Court's mixing-up of the notion “the harm caused by the introduction of the exceptions” and “the harm caused by the making of private copies”.

2. New EU developments in collective management of copyright

Sylvie Nerisson talked over new EU developments in collective management of copyright, which plays a role at the crossroad of copyright reforms (multiterritorial licenses, the position of publishers, opt-out schemes…). EU intervenes in this field today more than ever: Directive 2014/26/EU came into force on 10 April 2016; the CJEU upset both some old deal (cf. C-572/13, HP v Reprobel) and bold lawmakers (cf. C-301/15, Soulier/Doke); and the EU Commission rushed into the house of cards with its copyright package of 14 September 2016. 

The draft directive on copyright in the Digital Single Market introduces for example the possibility to extend collective licences regarding out-of-commerce works (art. 7), while the Court of justice just questioned the legitimacy of ECL schemes in the Soulier/Doke decision. Similarly, art. 14 of the draft directive on Copyright in the digital single market apparently intends to anchor the symbiosis of authors and publishers after the CJEU broke it in the HP v Reprobel case. 

Collective management of copyright in Europe today therefore raises many topical questions that interest both national and European judges, stakeholders and lawmakers. 

3. Reflections on the scope of mandate of European CMOs

Weeks after the TILTing Conference, in this Kat’s head, Lucie Guibault’s passionate remarks regarding mandates remain quite fresh: “Who grant permission to the SOFIA to allow it to grant licenses? Where does the SOFIA get her mandate? There is no mandate!” 

In a nutshell, Lucie talked over the brief reflections on the recent developments in the area of collective management of copyright. In particular, she critically explored the background and consequences of the Soulier case and examined the ramifications of the Reprobel case for the newly proposed exceptions and limitations, such as for visually impaired persons and data-mining.

She concluded that CMOs still play a major role in providing income to authors. In particular, they help negotiate with the very powerful parties. Yet, in some cases, the right question never gets asked: SOFIA’s mandate. Meanwhile, in some cases, the question gets answered, namely in the Reprobel case, yet the solution is circular. And In the end, the position of the most vulnerable party, namely the author, stays the same. 

Panel: Copyright Law-making in the EU

Ana Ramalho, the author of the book The Competence of the European Union in Copyright Law-making, chaired the panel. During the introduction, she provided some background on the topic of the panel, focussing inter alia competence issues and constitutional guidelines in relation to copyright law-making. 

1. Fundamental rights and European Intermediary liability in copyright

Christina Angelopoulos discussed the “Normative guidance of human rights in copyright law – the example of intermediary liability". 

Starting from a review of the current EU intermediary liability framework, she brought in the key issue: “intermediary liability as aconflict between fundamental rights”. As she discussed, the protection of IP is indeed enshrined in the Charter of Fundamental Rights of the European Union, yet as the CJEU has stated “nothing whatsoever in the wording of it or its case-law has suggested that the right is inviolable and must for that reason be absolutely protected”. 

Meanwhile, as stressed in the Promusicae (Case C-275/06), when transposing EU directives, the Member States must take care to rely on an interpretation of the directives which allows a “fair balance” to be struck between the various fundamental rights, for instance the freedom to conduct a business, protecting personal data and the freedom of expression, which are protected by the EU legal order. 

As regards seeking a “fair balance”, Christina provided insights regarding the balancing criteria, case law indications, and the approaches that are worth taking in response to the fundamental rights in question. She suggested that two roads lie now ahead: one is to relyon existing EU law, as the Opinion of AG Szpunar suggested in the case of Stichting Brein v Ziggo; the other is the adoption of new EU law, i.e. a new proposal for a Directive on Copyright in the Digital Single Market.

2. Finding the right policy: is blanket licensing an alternative?

Balázs Bodó provided a methodological perspective. He opened his speech by addressing the (problematic) status quo: music streaming seems to be working nowadays, but online copyright infringement is still significant. Enforcement is ineffective and costly; and the enforcement fallout is significant. Access (esp. for AV content) is still limited; rights markets are fragmented, inefficient, transaction costs are high; network effects favour monopolistic middlemen. Streaming royalties leave many creators unsatisfied. 

Is blanket license, which authorizing the non-commercial use of digital content for a monthly fee on broadband connections, an alternative in terms of finding the right policy?

To answer that, he pointed out three preconditions of policy change: legal feasibility (no politically unrealistic change to the current copyright framework), economic viability (overall social welfare must not decrease), legitimacy (consent of the public). As goals, these preconditions then thereof define the research methods, namely: define the legally permissible policy space; formulate different policy alternatives that fit into that space; ask a representative sample of citizens about their preferences and calculate the economic consequences of their choice. 

In the end, he presented the key takeaways: it is possible to survey citizen support for complex copyright policy alternatives, which deserves a try; behind the happy surface of streaming, consumers are not getting what they want. Access to AV content is the next frontier. The most avid digital consumers are the most dissatisfied with the status quo; maintaining exclusivity is very costly: hundreds of millions are left on the table every year. Plus, missions are wasted on destructive and ineffective enforcement.

For all the publications for the project Copyright in an Age of Access: Alternatives to Copyright Enforcement, see here

Keynote Speech

Professor John M. Golden delivered a very insightful speech on IP (focusing on patent and copyright) design, progress, and civil society in the US context. First, he broadly defined the concept of civil society which plays important roles in social welfare and democracy; then he introduced the American constitutional promotions for IP and progress and their close connections, and the reasons why progress could strain society, institutions and IP. 

He suggested that IP could bring about several benefits. For instance, it can harness and encourage private initiative (quote Abraham Lincoln: “... it added the fuel of interest to the fire of genius”), shape civil society and nature of civil discourse, shape civil society and economy, and provide hope and opportunity in unheroic age. But, IP could also potentially foster entrenchment and control, so several questions need to be answered when designing IP for a healthy civil society: 

- Access and proper rewards for all? (i.e. concerns with fees, litigation expense, discrimination against business models)
- Fostering dynamic and multipolar power structure, or entrenched control? (i.e. encouraging/enabling entrepreneurs)
- Nurturing/allowing opportunity and hope? (i.e. leaving adequate room for non-proprietary, non-commercial, or collective activities outside IP’s common focus?)

He then identified and illustrated five IP design principle for better IP, namely: pluralism, redundancy, adaptability, devolution and administrability, which were generated from various papers he had written (e.g. The Supreme Court as 'Prime Percolator': A Prescription for Appellate Review of Questions in Patent LawPrinciples for Patent RemediesPatent Privateers: Private Enforcement's Historical SurvivorsThe Fracking Revolution, Redundancy: When Law Repeats Itself). Finally, he concluded that after all, society will ultimately determine the future of IP and progress more generally. 

In the end

As mentioned in the very beginning of this serial report, this Kat did see this exceptional conference as a quite enjoyable feast of thinking. Yet, she doubts that this plain text report could capture and convey to the readers all its fullness ... Better to attend this biennial conference in person: maybe see you guys at TILTing 2019!

TILTing Perspectives 2017 report (2): The IP session and the Key Note TILTing Perspectives 2017 report (2): The IP session and the Key Note Reviewed by Tian Lu on Tuesday, June 06, 2017 Rating: 5

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