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Modernisation of the EU Copyright Rules Max Planck Institute for Innovation and Competition Research Paper No. 17-12 Reto M. Hilty Valentina Moscon Editors Modernisation of the EU Copyright Rules Position Statement of the Max Planck Institute for Innovation and Competition Max Planck Institute for Innovation and Competition Research Paper Series Max Planck Institute for Innovation and Competition for Innovation Institute Planck Max Reto M. Hilty • Valentina Moscon (Editors) Modernisation of the EU Copyright Rules Position Statement of the Max Planck Institute for Innovation and Competition Editors Professor Dr. Reto M. Hilty Director, Max Planck Institute for Innovation and Competition, Munich. Dr. Valentina Moscon Senior Research Fellow, Max Planck Institute for Innovation and Competition, Munich. Imprint Max Planck Institute for Innovation and Competition, 2017 Marstallplatz 1, 80539 Munich ISBN 978-3-00-057529-7 DOI 10.17617/2.2470998 Published under Creative Commons by-nc.sa 3.0 Germany Licence https://creativecommons.org/licenses/by-nc-sa/3.0/de/deed.en Foreword On 14 September 2016 the European Commission published a package of proposals aimed at the modernisation of copyright within the digital single market. The full suite of proposals (hereinafter “copyright package”) as well as the Commission’s background documents can be accessed via ec.europa.eu/digital-single-market/en/modernisation-eu-copyright-rules. This copyright package is of particular interest to the Max Planck Institute for Innovation and Competition (hereinafter the Institute), which has been committed since its founding in 1966 to the analysis and development of intellectual property and competition law on the basis of established scientific principles. The Institute regularly advises governmental bodies and other organisations taking an international approach and placing emphasis on the comparative analysis of law as well as economic and technological aspects of legal development. The Institute has responded to all of the proposals included in the copyright package in a Position Statement. It includes several parts and chapters written by a project team composed of Professor Dr Reto M. Hilty (lead), Dr Valentina Moscon (coordination), Andrea Bauer, Dr Silke von Lewinski, Ricarda Lotte, Tao Li, Heiko Richter, Moritz Sutterer. This team examined in different working groups whether the suggested provisions are adequate for reaching their intended objectives. In response to certain critical evaluations, a number of alternatives have been suggested. Each part and chapter has been published on the Institute’s website in the course of recent months. These have been brought together in the present e-book. The comments included in this Position Statement follow positions already taken by the Institute on related subject-matter, in particular the Position Statement on the “Public consultation on the role of publishers in the copyright value chain” from 2016, and the Position Statement concerning the “Implementation of the WIPO Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired or Otherwise Print Disabled” from 2015. We would like to express our sincere thanks to Peter Weber and Marcus Noack for their efforts in the publication of this e-book. Munich, September 2017 The Editors 3 Modernisation of the EU Copyright Rules SUMMARY CONTENTS Part A General Remarks Reto M. Hilty, Valentina Moscon 13 Part B – Copyright Exceptions and Limitations Chapter 1: Text and Data Mining (Article 3 COM(2016) 593 final) Reto M. Hilty, Heiko Richter 25 Chapter 2: Digital and Cross-Border Teaching Activities (Article 4 COM(2016) 593 final) Reto M. Hilty, Ricarda Lotte 35 Chapter 3: Preservation of Cultural Heritage (Article 5 COM(2016) 593 final) Reto M. Hilty, Valentina Moscon, Tao Li 45 Chapter 4: Implementation of the Marrakesh Treaty (COM(2016) 596 final and COM(2016) 595 final) Reto M. Hilty, Silke von Lewinski, Valentina Moscon 51 Part C – Out-of Commerce Works (Articles 7-9 COM(2016) 593 final) Reto M. Hilty, Tao Li, Valentina Moscon 61 Part D – Copyright Contract Law (Article 10 and Articles 14-16 COM(2016) 593 final) Reto M. Hilty, Valentina Moscon 71 Part E – Protection of Press Publications Concerning Digital Uses (Article 11 COM(2016) 593 final) Reto M. Hilty, Valentina Moscon 79 4 SUMMARY CONTENTS Part F – Claims to Fair Compensation (Article 12 COM(2016) 593 final) Reto M. Hilty, Valentina Moscon 89 Part G - Use of Protected Content on Online Platforms (Article 13 COM(2016) 593 final) Reto M. Hilty, Andrea Bauer 99 Part H – Intra-European Content Circulation (COM(2016) 594 final) Reto M. Hilty, Moritz Sutterer 113 5 Modernisation of the EU Copyright Rules DETAILED CONTENTS PART A General Remarks 13 Executive summary 13 I. Context and the Commission’s objectives 14 II. Summary table of the proposals included in the copyright package 14 III. Additional legislative layers 16 IV. Fragmentation of the legal framework 17 V. Imprecisions of the legislative technique 17 1. The notion of rightholder 18 2. Exceptions, limitations and fair compensation 18 3. Communication to the public and making available to the public 19 VI. Incompliance with the principle of proportionality 20 VII. Alternative regulatory approach 21 Table of Equivalences 23 PART B Exceptions and Limitations Chapter 1: Text and Data Mining (Article 3 COM(2016) 593 final) 25 Executive summary 25 I. Introduction 26 II. The Commission’s proposal 26 1. Content 26 2. Concerns regarding the regulatory method 27 3. Concerns regarding the content 28 III. Alternative regulatory proposal 28 1. TDM as normal use 28 2. Advanced business models on a contractual basis 30 3. TDM related to non-accessible content 31 4. The need and importance of technical protection measures 32 5. Storage and accessibility 32 IV. Proposal 33 6 DETAILED CONTENTS PART B Exceptions and Limitations Chapter 2: Digital and Cross-Border Teaching Activities (Article 4 COM(2016) 593 final) 35 Executive summary 35 I. Background 36 II. The Commission’s proposal 36 1. Content 36 2. Degree of harmonisation 36 3. Concerns regarding content 37 a) Scope of application 37 b) Licence priority 38 c) Remuneration 38 4. Relation to previous limitations 39 5. Wording (concerns the German version only) 40 III. Alternative regulatory proposal 41 1. Scope of application 41 2. Licence priority 41 3. Exemption 41 4. Remuneration 42 IV. Proposal 42 PART B Exceptions and Limitations Chapter 3: Preservation of Cultural Heritage (Article 5 COM(2016) 593 final) 45 Executive summary 45 I. Background 46 1. General considerations 46 2. Justification 46 II. Concerns regarding the Commission’s proposal 48 1. Definitions 48 a) “Cultural heritage institutions” 48 b) “Works or other subject matter that are permanently in their collections” 48 2. Making copies on behalf of CHIs 48 III. A more ambitious approach 49 IV. Proposal 50 7 Modernisation of the EU Copyright Rules PART B Exceptions and Limitations Chapter 4: Implementation of the Marrakesh Treaty (Proposal for a Directive - COM(2016) 596 final; Proposal for a Regulation - COM(2016) 595 final) 51 Executive summary 51 I. Introduction 52 II. Regulatory approach 52 III. Concerns regarding the content of the proposed Directive 53 1. Right of remuneration 53 2. Priority to commercial offers made under reasonable terms 54 3. Definitions 54 a) “Work and other subject-matter” 54 b) “Accessible format copy” 55 c) “Authorised entities” 55 4. Permitted use 55 a) Rights covered by the limitation 55 b) Conditions 56 IV. Proposal 56 PART C Out-of-Commerce Works (Articles 7-9 COM(2016) 593 final) 61 Executive summary 61 I. Background 62 II. Concerns about the Commission’s proposal 63 1. Definition of “out-of-commerce works” 63 2. Scope of use of out-of-commerce works 64 3. “Non-commercial purposes” 65 4. “Broadly representative” CMOs 66 5. Right to object and to exclude a licence (Article 7(1)(c) and Article 7(3)(c)) 66 6. Compensation 67 III. Proposal 67 8 DETAILED CONTENTS PART D Copyright Contract Law (Article 10, Articles 14 - 16 COM(2016) 593 final) 71 Executive summary 71 I. Background 72 II. Concerns about the Commission’s proposal 73 1. Competence 73 2. Neglected issues 74 3. Shortcomings in the proposals 74 a) Article 14 74 b) Articles 15 and 16 75 c) Article 10 76 III. Conclusions 77 PART E Protection of Press Publications Concerning Digital Uses (Article 11, COM(2016) 593 final) 79 Executive summary 79 I. Introduction 80 II. The Commission proposal: Concerns 81 1. Undefined object of the proposed neighbouring right 81 2. No economic “rationale” for a press publishers’ neighbouring right 81 3. Non-substitutive effect of intermediaries’ activities 82 4. Hindering the development of new business models 83 5. Experiences from Germany and Spain 83 6. Inconsistencies with the EU copyright acquis 86 a) Indexing and displaying news and articles 86 b) Extracts of articles as copyright subject matter (so-called snippets) 86 c) “Sui generis” right for databases 87 d) Conflict with relevant interests of authors and users 87 7. Duration of the right 87 8. Competence of the EU legislature 88 9. Conflicts with fundamental rights 88 10. Focus on licensing and enforcement 88 9 Modernisation of the EU Copyright Rules PART F Claims to Fair Compensation (Article 12 COM(2016) 593 final) 89 Executive summary 89 I. Background 90 II. The Commission’s proposal: Concerns 92 1. Need for clear and consistent concepts 92 a) Fair compensation vs. (equitable) remuneration 92 b) Rightholder 93 2. Legal foundation to claims to fair compensation 94 III. Alternative regulatory approach 95 IV. Proposal 96 Table of Equivalences 97 PART G Use of Protected Content on Online Platforms (Article 13 COM(2016) 593 final) 99 Executive summary 99 I. Background and objectives 100 II. Regarding the Commission’s proposal 100 1. Content 100 2. Conceptual critique 101 a) Overall 101 b) In regard to the German and English version 102 3.
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