New Copyright Directive published: how will it change the EU's copyright framework?

The new Copyright in the digital single market directive has been officially published, meaning that it will come into force on 7 June 2019. However, Member States have until 7 June 2021 to implement the directive and it is only from that date that its provisions will actually start to apply to works and other subject matter that are protected by copyright.

The Commission had originally hoped that a new copyright directive would be an opportunity to harmonise copyright law across the EU to a much greater extent – at one stage there was even talk about a single copyright title that would cover the whole of the EU, rather than separate copyrights covering individual Member States governed by their own national laws. However, those ambitions had to be scaled back. In the end, the DSM Copyright Directive has ended up a collection of provisions intended to address a number of specific issues.

The most controversial provisions and the ones that have attracted the most attention to date are what are now Article 15 – a new press publication right – and Article 17 – increased obligations on content-sharing platforms if they are to avoid liability for copyright infringing content uploaded by their users (these articles were previously known as Article 11 and 13 respectively before revisions to the article numbers). The DSM Copyright Directive does not just consist of these two articles though and we summarise its various provisions below:

Press publication right: Article 15

The press publication right is intended to give publishers greater leverage to negotiate licensing deals with news aggregators, search engines and other online platforms that link through to their content. Although it has been dubbed a ‘link tax’, the new right explicitly does not prevent acts of hyperlinking. However, it does cover the reproduction of short extracts from press publications – such as headlines, short snippets of an article or photographs (although not “individual words or very short extracts”). The reproduction of these extracts will generally be required to enable consumers to understand what content is being linked to, so online services that provided links to news articles and other press publication content will in practice need to obtain licenses in the future.

Although larger publishers have been strong advocates for Article 15, there have been concerns from some smaller publishers that their lack of bargaining power means that at best they will be unlikely to negotiate significant licence fees and at worst online platforms and search engines will simply stop linking to their content.

The press publication right does not apply to private or non-commercial uses of press publications – a provision that is intended to ensure that it does not prevent sharing of articles by individual users.

Another important change in the agreed text is that the press publication rights will expire only two years after publication.

Increased liability for platforms: Article 17

Article 17 has seen the most changes to the text through the legislative process. The end result is that under Article 17, established commercial content-sharing platforms will be considered to be performing an act of communication when they provide access to copyright protected works or other protected subject matter (such as sound recordings or broadcasts).

As a consequence, content sharing platforms will be required to enter into licensing arrangements with rightsholders and will otherwise be liable for infringing content on their platforms unless they have satisfied three cumulative requirements:

1. they have made best efforts to enter into a licensing deal;
2. they have made best efforts to ensure the unavailability of copyright protected works and other subject matter which have been identified to them by rightsholders; and
3. they act quickly to remove copyright protected works and other subject matter when notified of specific content and then make best efforts to prevent future uploads in accordance with point 2) above.

Article 17 provides that new (less than three year old) online platforms with a turnover of less than €10 million will not be obliged to prevent future uploads, but will still need to make best efforts to enter into licensing deals and remove specific infringing content that is notified to them.

The adoption of this Article 17 will be generally seen as a win for rightsholders and a blow to Google – which operates YouTube, the content sharing platform that Article 17 is mostly targeted against. However, the final text could have been worse for Google and it is still difficult to assess how this change of the law will actually impact YouTube’s and other online platforms’ revenue streams. This will in large part be dependent on how the ‘best efforts’ requirements are interpreted within national legislation and then by national courts and ultimately the Court of Justice. The Directive also provides for "stakeholder dialogues" to take place during the implementation of the Directive, following which the Commission is to issue guidance on the application of Article 17.

Mandatory text and data mining exceptions – Articles 3 and 4

Articles 3 and 4 require Member States to bring in two exceptions that are intended to make it easier to use analytical tools on third party text and other data to extract useful information without infringing copyright or database rights.

Article 3 provides an exception only to research organisations and cultural heritage institutions for the purposes of scientific research. Article 4 provides an exception for lawfully accessible subject matter that is not limited to such organisations but rightsholders can effectively opt-out of this exception by expressly reserving the right to exploit their subject matter in this way.

Fair remuneration for authors and performers – Articles 18 to 23

The Directive provides that when authors and performers licence or transfer their exclusive rights for the exploitation of their works, they are entitled to receive "appropriate and proportionate remuneration". The Directive allows Member States to decide what mechanisms to use to implement that principle but it does require all Member States to put in place:

• transparency obligations, requiring parties to whom authors and performers have licensed or transferred their rights to provide information on the exploitation of their works including revenues generated and remuneration due;
• a contract adjustment mechanism to allow authors and performers to claim additional remuneration when the revenues received are disproportionally low; and
• a right of revocation where there is a lack of exploitation of the relevant work.

There would appear to be scope for a wide divergence in the implementation of these provisions and stakeholders are likely to be active in lobbying Member States during the implementation process.

Other provisions

The other key provisions of the Directive are:

• a new mandatory exception covering the digital use of works for the sole purpose of illustration for teaching – Article 5;
• a new mandatory exception covering the preservation by cultural heritage institutions of works that are permanently in their collections – Article 6;
• measures that will make it easier for cultural heritage institutions to make available out-of-commerce works that are permanently in their collections – Articles 8-11;
• changes to the EU's collective licensing rules, which allow (but don't require) Member States to give collective management organisations the ability to provide licences for rights of rightholders who have not contracted with the collective management organisations – Article 12;
• a requirement on Member States to establish or designate an impartial body to assist with the negotiation of licensing of audio-visual works on video-on demand platforms – Article 13; and
• a prohibition on non-creative reproductions of works of visual art in the public domain attracting copyright or related rights – Article 14 (this will mean, for example, that a non-creative photograph of the Mona Lisa would not itself attract copyright protection).

Implementation in the UK

Whether the new Directive will ever be implemented in the UK will depend on when and how the UK leaves the EU. The implementation deadline for the Directive is after the expiry of the transition period in the draft Withdrawal Agreement – during which the UK would be required to comply with any implementation deadlines. However, that transition period is extendable and any such extension would therefore require the UK to implement the Directive.