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Legal Advisory Board

Discussion of Commission
Green Paper on Copyright 

Luxembourg, 21 September 1995


1. Introduction

The meeting was opened by Herbert BURKERT, Chairman of the LAB. He explained that the subject of the meeting was the Green Paper on Copyright and Related Issues in the Information Society 1 , on which the Commission had invited comments. Bernt HUGENHOLTZ, Chairman of the Intellectual Property Rights Task Force of the LAB 2 would act as rapporteur and summarise the Green Paper and outline the four main topics, which would then be discussed individually.

2. Summary of Green Paper: Prof. HUGENHOLTZ

Prof. HUGENHOLTZ said that the document would be discussed from the LAB perspective, which was different from the pure intellectual property perspective of the Green Paper itself, and focused on:

The IPR Task Force would respond on behalf of the LAB to the Green Paper by the time-limit of 31 October, on the basis of input from members at the meeting and in writing.

The Green Paper was about two things: the information superhighway and its effects on copyright and neighbouring rights, and problems of acquiring and managing multimedia rights.

The Green paper was not the first document which the Commission had produced. The 1988 Green Paper on the Challenges of Technology set an agenda for the Commission which resulted in a number of Directives: Software Directive 1991 3 , Rental Right Directive 1992 4 , Cable and Satellite Directive 1993 5 , and Term of Protection Directive 1993 6 . 1995 will see the adoption of the Database Directive

The present Green paper was triggered by the Bangemann report 7 , which identified intellectual property issues as a crucial potential obstacle to the creation of a European digital multimedia market.

It is not the only policy paper in existence. The Japanese published two MITI reports on the management of rights in multimedia products and moral rights. In July 1994 the Intellectual Property Task Force of the National Information Infrastructure published a Green Paper in the United States 8 , which resulted in the recently published NII White Paper 9 . This is less ambitious than the Green Paper and suggests a number of not very sweeping changes to the existing US copyright law, mainly focusing on the catalogue of restricted acts. The most important proposals are to extend the existing distribution right originally linked to the distribution of physical objects such as books and CDs to transmission over networks, and to extend the scope of existing exemptions, such as fair use and library privileges, to digital copying and archiving. The latter is an important proposal and the issue has not yet been fully explored in Europe and is not really addressed by the Commission Green Paper. In Europe, there was the French Sirinelli report on multimedia. 10

In WIPO developments in relation to the Berne protocol, which has been on the table for many years, are accelerating due to the desire of the United States government to have the protocol apply to acts of superhighway distribution.

The Green Paper is divided into two chapters explaining the cultural, technical and regulatory environment of the information society. It describes the European instruments already in place which are relevant to copyright on the superhighway. The Computer Software Directive is relevant because it recovers the transmission right and also because it takes a broad view of the reproduction right. The Satellite and Cable Directive might be a model for applying national law to acts of superhighway distribution. The Database Directive is extremely relevant because much of the material on the superhighway will originate in databases. The most important question asked at the end of the Chapter is:

What do you think is the most appropriate level for dealing with questions of intellectual property in the information society, national, Community or international.?

The substantive issues are addressed in Chapter 2 which identifies 5 different fields of potential problems of regulation.

1. What should be the applicable law on the information superhighway? Should this be all relevant national laws, so that one transmission is a restricted act under many different national legislations, or should the approach of the Satellite and Cable Directive, which provides that a satellite broadcast is an act of communication to the public only in the country where the broadcast originates, be transposed to the network environment? 2. Should the principle of the exhaustion of rights (first sale doctrine under US law), whereby rights of distribution may no longer be exercised after the first putting into circulation of physical copies of a work, also apply to transmissions over a network? The Commission does not think so, probably rightly in Prof. HUGENHOLTZ' view. If exhaustion is applied, should it be world-wide or European only? The Commission advocates European exhaustion, meaning that the right of distribution is not exhausted in respect of copies that are put into circulation outside the European Community. 3. The most important issue of all: how should we define the economic rights, reproduction, communication to the public, broadcasting etc. in the network environment? 4. How should multimedia rights be managed? How does a multimedia producer who wants to use pre-existing works or fragments or parts of pre-existing works track down copyright holders and obtain all necessary licences, which may number several thousand? The Commission opposes the granting of compulsory licences, referring to the opinion of industry expressed at the hearing in Brussels in July 1994, but favours "one-stop shops" set up on a voluntary basis. 5. Technical identification and protection. It is technically possible to tattoo works in order to identify their copyright status, and trace and monitor their use. Should the European legislator intervene to standardise? The Commission's approach here seems to be to take a "wait and see" attitude.

The Green Paper as a whole does not seek a sweeping reform of intellectual property law. Some proposals, however, are important and far-reaching.

Prof. HUGENHOLTZ returned to the discussion in the Green Paper of economic rights, including the reproduction right, communication right, rental right and a limited discussion of copyright exemptions.

2.1. Scope of reproduction right

The first and most important question was the scope of the reproduction right. Should this include all types of intermediate, temporary storage? Every act of using a computer involves various types of intermediate storage. This occurs where an e-mail message is sent through the Internet and will be copied 7 to 10 times before reaching the intended destination, or where a user browses the Internet, looking at different pages and so displaying parts of protected works on his screen. Should the copyright owner's reproduction right cover the intermediate copies? An extended reproduction right would enable right owners to prohibit individual acts of usage. In the analogue world, however, reading a book, viewing the television or listening to music is not a restricted act.

A use right would also entail all sorts of privacy problems, which are not addressed in the Green Paper, although the Green Paper correctly states that the digital environment enables the monitoring of individual use, which is the reason for which a review of existing exemptions is proposed.

2.2. Scope of right of communication to the public

The Commission asks:

"Under what conditions do you think that the following acts can be considered as forms of private use:

Not all national laws contain a broad right covering communication to the public, and delimiting public from private communication was not easy. If it were extended to point-to-point communications, this would include an e-mail message which contained a protected work.

The Green Paper contains interesting language on the rental right. The Commission takes the view that it would be possible to extend the rental right to include transmissions on demand over the network, although because the rental right was originally designed to cover physical acts of distribution. This would imply, inter alia, that public libraries might benefit from the rather lenient lending rights regime in offering information services on-line. If this were done, it would not be necessary to create of a new digital dissemination right

2.3. Copyright exemptions

The Green Paper does not deal with many of the existing exemptions, but does discuss private copying.

The Green Paper suggests that existing exemptions or limitations for private copying and other unauthorised uses, which could not be controlled, must be reviewed in the light of the emerging digital environment. According to the Commission, the new technologies will enable the detection and monitoring of private copying. Therefore, existing statutory licenses (e.g. for photocopying) might, perhaps, no longer be justified.

The Commission takes the view that, in any respect, some degree of harmonisation in respect of private copying will be necessary. Prof. HUGENHOLTZ agreed, in view of the amazing divergence which currently existed between exemptions in national laws. That divergence could not be maintained with the global information society.

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