General rules on direct and indirect liability for copyright infringement instead of Art. 13

Kat gap
As the debate around the draft Directive on copyright in the Digital Single Market continues to unfold [Katposts here], The IPKat is happy to publish the following contribution by Ansgar Ohly and Matthias Leistner (both LMU München) concerning their proposal – which will be hosted in full on the Journal of Intellectual Property Law & Practice (JIPLP) – concerning Article 13, that is the value gap (or transfer of value) proposal.
Here’s what Ansgar and Matthias write:
After lengthy discussion in the Council and in the European Parliament, the proposed Directive on Copyright in the Digital Single Market (2016/0280(COD)) has now entered the trilogue. The most recent meeting took place on 26 November. Two more meetings are planned until the end of the year, and the ambitious goal is to reach a result by January 2019.

Much of the discussion in Parliament as well as in the media has been about the proposed Art. 13, which concerns the liability of online content sharing service providers. The original proposal of the Commission (2016/0280(COD)) was modified by the Council (Council Text 9134/18) and by the European Parliament. In fact, the EP’s approach is even stricter than the one proposed by the Commission (EP Text P8_TA-PROV(2018)0337A8-0245/2018).

We feel that a clear, simple and reasonable solution cannot be achieved without amending the InfoSoc Directive. We have presented a proposal which is not limited to online content sharing service providers, but which tries to tackle the liability of intermediaries in general. The proposal will be published by JIPLP and will be made available online as a pre-print.
We observe that the CJEU in its recent judgments on communication to the public has in effect distinguished between direct acts of communication (e.g. uploads) and indirect acts (e.g. surface hyperlinking). As the Renckhoff judgment (C-161/17) [Katpost here] shows, liability for direct infringement is strict and does not depend on additional criteria. In cases of indirect liability such as GS Media (C-160/15) [Katposts here], in contrast, the CJEU has applied a flexible set of interdependent criteria, some of which are subjective (full knowledge), some of which are objective (for-profit nature of activity, necessary checks). The proposal builds on this distinction.
We envisage restricting Art. 3 InfoSoc to direct acts of communication, defined as “autonomous acts which effect the communication as opposed to acts which merely enable third persons to communicate the work”. This is contrasted with indirect liability, for which we propose a new Art. 4a InfoSoc. This numbering takes account of the fact that, not only the right of communication to the public, but also the reproduction and distribution rights can be infringed indirectly. A person is liable under Art. 4a if he or she enables another person to infringe and either has knowledge of the infringement or has not taken reasonable precautions in order to terminate or prevent the infringement. These precautions consist in reacting expeditiously to a notice of infringement and pro-active measures to prevent the availability of specific works identified by right holders. The proposal also envisages a complaint mechanism for users and incentives for right owners, service providers and user organisations to reach agreements on licenses or the scope of proportionate duties of care.
The crucial question is, of course, whether operators of platforms such as YouTube are direct or indirect infringers. The present proposals of Art. 13 seem undecided about this crucial point and partly mix up both categories. We think that there must be a decision, but that it is a political rather than a doctrinal one. If YouTube and comparable platforms are regarded as content providers which compete with services such as Spotify, then Art. 3 InfoSoc should apply, but a new exception for small-scale content sharing for private purposes (for example for Kat videos) should be introduced; in addition, instruments such as extended collective licenses should be considered. But if YouTube is only an intermediary, it only has to take reasonable precautions against infringements. We do not decide this issue, because both options seem arguable to us. But we offer clear categories of liability and complement this with a non-exhaustive list of less contentious statutory case examples in our proposal. For the contentious cases, it is up to the Parliament and the Council to take a decision. They should do so in a transparent way without pretending that a platform operator can be both at the same time: a content provider and an intermediary. But perhaps the CJEU will decide first: the German Federal Supreme Court recently referred two cases on the liability of YouTube and of a sharehoster, respectively, to the CJEU (case No. I ZR 140/15 and case Nos. I ZR 53/17-57/17) [Katpost here].
It may be too late to stop the EU train, which is heading towards a political compromise resulting in a complicated sui-generis regime. But even if this is the case, we hope to suggest a structure for the ongoing trilogue negotiations and any future discussion of liability for copyright infringement in European law.
General rules on direct and indirect liability for copyright infringement instead of Art. 13 General rules on direct and indirect liability for copyright infringement instead of Art. 13 Reviewed by Eleonora Rosati on Monday, December 03, 2018 Rating: 5

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