EC takes plunge into copyright management reform

The European Commission has introduced contentious new proposals for a Directive on the collective management of copyright and multi-territorial licensing of content.

The EC maintains that the system of collective rights management needs to be reformed in order to improve transparency and ensure the efficient working of digital distribution businesses including music download and streaming services. The Commission believes in particular that new music services across the EU have been slow to develop as a result.

Under the current system, collecting societies in individual states grant licences to distributors and collect and redistribute royalties to rightsholders – mostly performers and authors, with producers and publishers mostly managing their own rights.

The Directive would enshrine in law the ability of rightsholders to decide which collecting society would manage their rights, effectively establishing a single market in rights management. It would also set out EU-wide regulations on how societies should be managed.

The EC is also seeking to improve the record of collecting societies in issuing EU-wide licences. Under the proposals, collecting societies could licence works across all EU states or certain states, could outsource the management of their databases to third parties, could ask other collecting societies in other states to license works on their behalf – with no right of refusal permitted – or could create subsidiaries in other EU states to manage rights in one or more territories. Rightsholders would have the ability to grant online rights to other societies or do their own licensing if their existing collecting society failed to avail itself of one of the methods outlined above.

The EC proposals have met with strong opposition from parties including French authors society the SACD, which described them as “sloppy, inconsistent and detrimental to content creators”.  The SACD said that the EC’s bureaucrats had made no attempt to consult with content creators and had attempted to lump together a set of rules that make no distinction between the music and audiovisual markets or the structure of the industry in individual member states, which, in the case of audiovisual rights, is based on exclusive distribution on a territory-by-territory basis. It said that the proposals would create a system that was even more complex for distributors to negotiate, as they would have to systematically verify rights and authorisations for each individual title.