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The European Commission’s copyright proposal: the end of the Digital Single Market’s ambitions?

“To make the EU’s single market fit for the digital age”, by “bringing down barriers to unlock online opportunities” was one of the priorities of the current European Commission. This objective would be reached by “improving access to digital goods and services”, creating “an environment where digital networks and services can proposer” and by “ensuring that Europe’s economy, industry and employment take full advantage of what digitisation offers”.

This objective raised the hopes of the tech industry, often struggling with 28 different regulations when trying to scale their operations across the European Union. Unfortunately, the legislative proposals published by the Commission for the past year have not lived up to the tech industry’s expectations. In short, after disappointing audiovisual and telecom proposals, the Commission’s proposal for a Directive on copyright in the Digital Single Market marks the end of the Commission’s Digital Single Market ambitions.

With this copyright proposal, the European Commission has, in fact, bowed to the lobbying of legacy industries on four crucial issues, to the detriment of users’ fundamental rights, the growth of European startups, creativity and innovation.

Firstly, this proposal undermines the e-Commerce Directive, cornerstone of Europe’s digital economy, by implying that websites promoting or optimising the display of user generated content would fall out of the scope of the limited liability regime for intermediaries. In practice, most hosting websites created after 2000 would become liable for content uploaded by their users, thereby freezing innovation, free speech and investments.

Secondly, this proposal requires internet companies “that store and provide to the public access to large amounts of works (…) uploaded by their users” to implement “measures, such as the use of effective content recognition technologies” to ensure the removal of content unauthorised by rightholders. Again, in practice this would create a general obligation to monitor content uploaded by users for thousands of websites. Without even speaking of the prohibitive  financial investments this would represent for companies, the main danger of this requirement is its strong negative impact on users’ fundamental rights. Setting up content filtering software is indeed an extremely complicated and delicate exercise, as it needs to balance the limits of the software, the interests of rightholders and users’ fundamental rights. The implementation of content filtering technologies on a large scale will generate the takedowns of huge amounts of contents uploaded by users that do not infringe copyright, leading to widespread censorship.

Thirdly, this proposals introduces a neighbouring right for publishers regarding the online uses of their press publications. This very broad right aims at implementing at the European level the ancillary rights for press publishers that failed in Germany and Spain, despite widespread opposition and proven impact of web traffic on the revenues of news publishers. The immediate consequences of this measure are the creation of another layer of rights on top of an incredibly complicated European copyright framework and huge legal uncertainties with regard to content sharing. These uncertainties will once again chill innovation at a crucial time for the publishing industry and generate decades of legal fights in front of national courts, all the way up to Europe’s highest court of justice.  

Fourthly, this proposal does not truly harmonise the exceptions and limitations to copyright across the EU, and has simply set aside the freedom of panorama exception – i.e. the right to take and use photos of public spaces, supposedly too complicated to implement across Europe. Moreover, while a welcome provision on Text and Data Mining is introduced, some elements are worrisome – for example, the fact that the beneficiaries of this Text and Data Mining exception are limited to “research organisations”, excluding from the scope start-ups and individual researchers.

In short, there is only one provision in this proposal that would actually benefit directly authors and performers: transparency requirements on the exploitation of their works and performances from intermediaries (for example, a music label) to whom they have licensed or transferred their rights.

To sum up, September 2016 has been quite a month for copyright law in Europe, with this backward-looking European Commission’s copyright proposal coming on the heels of a disastrous GS Media decision on hyperlinking from Europe’s highest court of Justice. Is there still a chance for the EU to adopt a forward-looking, future-proof, innovation and consumer-friendly copyright framework in the coming months? That answer lies in the hands of the European Council and the European Parliament.

European Union

DisCo is dedicated to examining technology and policy at a global scale.  Developments in the European Union play a considerable role in shaping both European and global technology markets.  EU regulations related to copyright, competition, privacy, innovation, and trade all affect the international development of technology and tech markets.