Intellectual Property Law22.02.2021Cologne Newsletter

Close to completion: EU copyright reform to adapt to the digital age

On 3 February 2021, the German Federal Cabinet [Bundeskabinett] adopted a draft law to adapt copyright law to the requirements of the digital single market. EU member states must transpose the requirements of Directive (EU) 2019/790 ("DSM Directive") into national law by 7 June 2021. With the bill, its implementation is now close to completion.

The bill provides for the introduction of a new law on the responsibility of upload platforms such as YouTube as well as numerous amendments to the German Copyright Act [Urheberrechtsgesetz, UrhG] and the German Collecting Societies Act [Verwertungsgesellschaftengesetz, VGG]. Below, we have compiled the most important innovations resulting from the government draft.

Responsibility of upload platforms

The German Act on the Copyright Responsibility of Upload Platforms for the Sharing of Online Content [Urheberrechts-Diensteanbieter-Gesetz, UrhDaG] will introduce a new legal instrument into German law.

Accordingly, upload platforms will in future be fundamentally responsible under copyright law for the reproduction of content that has been uploaded by users and can only exempt themselves from liability by complying with specifically regulated duties of care (§ 1 UrhDaG-E (draft law)). The "best possible efforts" must be made to acquire licences (§ 4 UrhDaG-E). In the event of unauthorised reproduction on the platform, the corresponding content must be blocked, whereby "automated procedures" may be used (§§ 7, 8 UrhDaG-E). The admissibility of upload filters is therefore being standardised by law.

However, the upload of "presumably permitted uses" remains possible in order to avoid so-called "overblocking". A use is "presumably permitted" if the upload contains only less than half of another person's work, the work is combined with other content and it is used only to a small extent or the user identifies it as legally permitted (§§ 9-12 UrhDaG-E).

The new Act provides for an appeal procedure as a legal remedy (§§ 14, 15 UrhDaG-E). In the event of a considerable economic impairment of the exploitation of the work, blocking is possible until proceedings are concluded even in case of presumably permitted uses (§ 14 (4) UrhDaG-E).

Tightening of copyright contract law

Furthermore, the German Copyright Act (UrhG) is to be amended to tighten copyright contract law. Accordingly, an appropriate participation of the author in the anticipated total income generated from the use has to be guaranteed in the future (§§ 32, 32a UrhG-E). In addition, information and accountability must be provided annually without have to be requested (§ 32d UrhG-E). In order to strengthen collective legal protection, authors may be represented by associations of authors in disputes over the appropriate participation (§ 32g UrhG-E). Accordingly, copyright contract law is being adapted to the detriment of the users of copyrighted works.

Further amendment of the Copyright Act and the Collecting Societies Act

The bill also envisages the repeal of the right of free use in line with the ECJ case law in the "Metall auf Metall" case (C-476/17). Furthermore, a new restriction on the use of works for the purpose of caricatures, parodies and pastiches is to be introduced (§ 51a UrhG-E). This will extend the right of citation to add further possibilities of using works for cultural purposes.

New regulations also include permissions for digital teaching and learning as well as for the preservation of cultural heritage (§§ 60a and 60e, respectively, 60f UrhG-E). Reproductions for text and data mining, i.e. the automated evaluation of large amounts of data, are permitted for the purposes of scientific research under certain conditions (§ 44b, 60d UrhG-E). On the other hand, reproductions of visual works that are in the public domain, e.g. photographs of old paintings, will no longer enjoy ancillary copyright protection in future. This is intended to facilitate access to reproductions of works in the public domain (§ 68 UrhG-E).

New provisions will also regulate the online distribution of television and radio programmes, e.g. by live stream or via media libraries (§§ 20b-20d UrhG-E). In future, it will only be possible to acquire rights to these retransmitted works centrally via collecting societies. However, authors and performers retain their direct remuneration claims against retransmission services.

Furthermore, the ancillary copyright protection for press publishers is being reformed (§§ 87f et seq. UrhG-E). The use of individual words or very short excerpts (so-called "snippets") from a press publication as well as the setting of hyperlinks to a press publication will remain possible without acquiring a licence (§ 87g (2) UrhG-E). The author's claim to a share in the revenues of the press publisher can now also only be asserted through a collecting society (§ 87k (2) UrG-E). The publisher's share is also being revised (§§ 27 et seq. VGG-E, § 63a UrhG-E) after the ECJ overturned the "copy levy" in 2015. According to this, the publisher will once have a lump-sum participation claim if the author has granted him rights. These new regulations are intended in particular to ensure the continued existence of VG Wort as a joint collecting society for authors and publishers.

The amendment of the Collecting Societies Act is going to introduce the possibility of acquiring collective licences with extended effect, so-called "extended collective licences" (Part 2 Section 5 VGG-E). This aims to facilitate the use of works on a contractual basis, for example for digitisation projects.

Bill meets with criticism

The Federal Association of Consumer Centres [Bundesverband der Verbraucherzentralen] criticises the fact that the bill includes the permissibility of upload filters, despite the fact these can have negative effects on users. In some cases, this is even seen as a threat to freedom of expression and artistic freedom.

Moreover, it remains unclear to whom the new law on the copyright responsibility of upload platforms is even going to apply. Youtube is the typical example - but it is uncertain whether, for example, Twitter, Instagram and Co. also fall within the scope of the law.

In contrast, the majority welcomes the reform of the press publishers' law, which could curb the exploitation of journalistic content by commercial platforms.

In all events, the government draft represents a long-awaited reaction of the legislator to the technological developments of recent years and the associated limits reached by the previous Copyright Act. Whether the regulations are designed to be practicable in all places will become clear when they are enforced over the coming years. In the case of the use of upload filters in particular, which has been the subject of heated debate for some time now, a question arises on a completely different level: What - independent of the legal issues - actually is the reality of the use of platforms like YouTube? Is it not about seeing things like members of the volunteer fire brigade dancing the "Jerusalema" challenge on YouTube, or should only original own content be shared?

Entry into force of the law in spring

The Federal Government's bill is now being forwarded to the Bundesrat for comment and will then be further discussed in the Bundestag and Bundesrat - probably amid lively legal-political debate. The law is then scheduled to take effect on 7 June 2021, the deadline for implementing the DSM Directive. Whether this will take place in the form proposed in the government draft definitely remains an open question.

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Dr. Fee Mäder

Dr. Fee Mäder

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