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The new mandatory exceptions: weaponless ... |
As readers know, the draft
Directive on copyright in the Digital Single Market [Katposts here]
has now reached the trilogue stage, further to the adoption – by both the Council
and the European
Parliament – of their own versions of the text to be used as a basis for
the next round of negotiations. An important aspect, which has not received too
much attention, concerns the topic of contractual override of new mandatory
exceptions in the directive.
Here’s what Adrian
writes:
Regular IPKat readers will be familiar with the EU Copyright in the
Digital Single Market Proposal, which was first detailed by the European Commission in 2016 and forms part of the Digital Single Market Strategy launched in 2015. The proposal continues to attract controversy as it undergoes
final compromise trilogue negotiations.
Lawmakers aim to finalise the text of the proposed Directive this month, with a
final vote in the EU Parliament to approve the package then likely in early
2019.
The most controversial and unresolved elements of the proposal relate to the proposed press publishers’ right (Article 11) [Katposts here]
and platform liability (Article 13) [Katposts here].
The proposal also includes provisions to ensure fair remuneration for authors
and performers (Articles 14 -16) and introduces
new exceptions for text and data mining
(Article 3) [Katposts
here
and see also here
and here],
digital and cross border
teaching (Article 4) and the preservation of cultural heritage (article 5).
This blog post focuses on the proposed
copyright exceptions in the proposal, and their compatibility with contractual
override – i.e. contractual terms in copyright licence agreements which purport
to restrict users’ ability to rely upon exceptions.
What is the existing
relationship between copyright exceptions and contract in the EU?
The current EU proposals aim to update the 2001 EU
Information Society Directive, which provides a list of copyright
exceptions from which member states may select when designing their domestic
copyright law. The Information Society Directive does not expressly set out
mandatory rules binding domestic Member States’ law on the relationship between
contract and exceptions. Copyright academics have generally argued that
contractual override of copyright exceptions is therefore permitted under the
Directive, subject to the flexibility for individual Member States to modify
this presumption in their domestic law.
In contrast to the Information Society Directive, other EU directives
relating to copyright have however explicitly addressed the relationship
between exceptions and contract. The Computer
Program Directive includes exceptions permitting the creation of backup
copies of a program, the privilege to observe, study or test the functioning of
the program, and decompilation which could not be excluded by contract. Similarly, the 1996 Database
Directive includes exceptions which could not be set aside by contract.
The relationship between copyright exceptions and contract has received
relatively limited judicial attention at the CJEU level. Some guidance has
however been given in Ryanair Ltd v
PR Aviation BV (Case C-30/14) and Verwertungsgesellschaft
Wort (VG Wort) v Kyocera and others (case 457/11). In Ryanair,
the court ruled that the provisions on unwaivable
copyright exceptions within the Database Directive applied only to databases
protected by the copyright or the sui
generis right. Where a database was not
protected by the copyright or sui generis
right, the Directive “does not
prevent the adoption of contractual clauses concerning the conditions of use of
such a database” [Para 39]. The contractual freedom aspects of the VG Wort case have received comparatively less attention, but the
case could be read as suggesting “that
the default position where contract or
licence terms are not expressly allowed to limit the scope of an exception is
that the exception will prevail over any rights holder authorisation.” (see voluntary memorandum from the UK Department for Business,
Innovation and Skills paragraph 5).
What does the
proposal say about contractual override of exceptions?
Article 6(1) of the Council’s proposal has been
provisionally agreed, and provides
that “[a]ny contractual provision contrary to the exceptions provided for in
Articles 3, 4 and 5 shall be
unenforceable.” On the face of this provision,
it seems that the new copyright exceptions introduced by the proposal cannot be
rendered ineffective by contract. That a specific copyright override provision
has been included in the proposal also
suggests that lawmakers are either unaware of the interpretation of VG Wort that by default copyright
exceptions prevail over contract or that
they doubt this interpretation of the case. The inclusion of Article 6(1) does
at least indicate that EU lawmakers are conscious of the risk of contractual
override of exceptions and that there is a broad political consensus that in
general exceptions should be protected
against such override.
A closer analysis of the agreed
texts of Articles 3, 4 and 5, however, demonstrates
that rather than preventing contractual
override, the proposed exceptions allow rightsholders to retain significant
contractual control. The text and data mining exception in Article 3(1)
operates only where the research organisations and cultural heritage
institutions have lawful access to the works or other subject matter.
Contractual conditions could potentially restrictively define the conditions of
lawful access to a database (for example, restricting the number of extractions
from a database which were within the scope of the licence; and deeming
additional extractions as involving unlawful access), restricting the operation
of the contractual override clause.
More troubling issues arise with the digital and cross border teaching exception in Article 4. Here Article 4(2)
permits a member state to legislate that the cross
border teaching exception does not apply either generally or for specific uses “to the extent that
suitable licences … covering the needs and specificities of educational
establishments are easily available in the market”. In other words, Member
States can provide that if the rights holder is offering a cross border teaching licence then the
exception in Article 4 does not apply at all and the contractual override
provision in Article 6(1) does not operate – effectively educational
establishments could face the mirage of an unremunerated exception that
operates in national law until a rights holder asks for a licence fee.
Finally, the exception permitting the preservation of cultural heritage
in Article 5 applies only where the relevant works “are permanently in [the
cultural heritage institutions’] collections”. As an increasing volume of
cultural material is not being sold,
merely licenced on a time-limited basis, and therefore never permanently
in the collection of an institution it might be
feared that the exception will do little to allow the preservation of
cultural heritage.
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... Or able to tame rightholders? |
‘Unenforceable’,
‘Null and void’ or ‘cannot be overridden by contract’?
The drafting choice in Article 6(1) to make contractual provisions
‘unenforceable’ is a peculiar choice. The term ‘unenforceable’
contrasts with language used in the
Software and Database Directives which make inconsistent contractual provisions
‘null and void’ and also diverges from the language used in the Directive
implementing the Marrakesh Treaty, which provides that an exception ‘cannot be overridden by contract’. There have
been no public statements from the EU bodies justifying the rationale for the differences in drafting language. If it the
legislative intention is that the terms ‘unenforceable’, ‘Null and void’ and ‘cannot be
overridden by contract’ should be treated as synonymous, then there
seems to be no good reason for the inconsistent drafting. On the other hand, if
there is an intention that these terms have distinct legal effects, then clarity on the legal significance
of these distinctions would be welcomed.
Finally, it is disappointing that the EU Commission and Parliament have
not used the opportunity presented by the review of EU copyright law to revisit
the Ryanair case. This means that for
creations that fall outside the meaning of a work in the Information
Society Directive there would be
greater contractual scope to restrict activities such as quotation which serve
the underlying public policies protected by copyright exceptions. Additionally,
the decision not to revisit the relationship between existing exceptions in the
Information Society Directive and contact means that core public interest
exceptions (e.g. quotations for purposes such as criticism or review under
Article 5(3)(d) of the Information Society Directive) remain at greater risk of
contractual override than the new, arguably less important, exceptions
introduced in this recent proposal.
See also ECJ Copydan Rec. 65 f. To my opinion the ECJ's wording makes it clearer, that your interpretation of VG Wort is correct. What do you think?
ReplyDelete"Accordingly, with regard to the effect on fair compensation of the fact that the rightholder has consented to the use of files containing protected works, the Court has held that where a Member State has decided, pursuant to Article 5(2) of Directive 2001/29, to exclude, from the material scope of that provision, any right for rightholders to authorise reproduction of their works for private use, any authorising act a rightholder may adopt will be devoid of legal effects under the law of that State. Consequently, such an act has no effect on the harm caused to rightholders due to the introduction of the measure depriving them of that right and cannot, therefore, have any bearing on the fair compensation owed, whether it is provided for on a compulsory or an optional basis, under the relevant provision of that directive (see judgment in VG Wort and Others, C‑457/11 to C‑460/11, EU:C:2013:426, paragraph 37).
Since, in circumstances such as those set out in paragraph 65 above, such authorisation is devoid of legal effects, it cannot, of itself, give rise to an obligation to pay remuneration of any kind in respect of the reproduction, for private use, by the user of the files concerned to the rightholder who authorised such use."