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Out-Law Guide | 30 Mar 2005 | 1:30 am | 7 min. read
This guide is based on UK law. It was last updated in August 2008.
In the UK, the (then) Patent Office conducted a wide-ranging consultation before finalising the implementing Regulations, which came into force on 31st October 2003, amending the Copyright, Designs and Patents Act 1988.
A progress report published after the consultation admitted that "a few controversial aspects are continuing to generate debate," which explains the delay in implementation. FAST contributed to the consultation, saying it welcomed the implementation of the Directive and "the greater clarity this will bring to lawful use of software".
One of the aims of the Directive was to harmonise the EU position with that of the World Intellectual Property Organisation, however it was very timely in also attempting to adapt copyright law to the information society and the new ways in which copyright work has been used and distributed in the last decade, reflecting the massive growth in the distribution of digital content over the internet.
This article outlines the main provisions of the Directive, and identifies areas that caused the biggest difficulties for the legislator in implementing it in the UK. It also seeks to highlight some of the practical consequences of the Directive, and areas that have been exploited by copyright owners.
The three main provisions of the Directive were:
The Government admitted that TPMs "prompted more comment than any other aspect of the Directive". The Directive says member states are to provide adequate legal protection against the circumvention of any effective technological measures. TPMs include those designed "to prevent or restrict acts ... which are not authorised by the rightholder"; the Regulations state that technological measures include "any device, design or component which is designed ... to protect a copyright work". One example of a TPM is the use of encryption; another is the production of CDs that cannot be copied (or even played) on PCs.
Responses to the consultation on TPMs came from both rightholders concerned that the Regulations did not go far enough, and individuals concerned that the protection of TPMs could lead to anti-competitive practices and affect data privacy.
The Directive does not include computer programs among those works able to benefit from the legislation covering TPMs. FAST commented in its response that the Government should make it clear that "products are not deprived of protection ... merely because they include computer programs". As it is, the Government retained an old provision of the Copyright, Designs and Patents Act which already gave some protection for TPMs in relation to computer programs.
The new provisions gave an incentive to rightholders to employ and design new methods for protecting their rights against copying and other uses, in the knowledge that there are statutory penalties for those attempting to circumvent them. Rightholders are now able to sue individuals bypassing TPMs and, importantly, those making and distributing equipment used to circumvent TPMs (as was the case when Sony issued proceedings against a number of individuals who had designed and sold a 'chip' which could be installed on PS2 consoles and enabled the consoles to play illegally copied games which would otherwise have not been recognised by the consoles). Additionally, the latter category of infringer may be criminally liable.
Perhaps surprisingly, RMI caused less controversy. In the last few years rightholders have been protecting their works by using unique codes to identify, track and assist with the use of works, so that anyone attempting to breach copyright can be traced. For instance, a piece of software may be sold to a customer. If that customer then makes the software available over a peer-to-peer file sharing network, the rightholder can identify the customer potentially in breach of copyright.
The Regulations provide for rightholders to be given a civil remedy against anyone who "knowingly and without authority removes or alters electronic rights management information". Some organisations called for criminal sanctions to be added to the protection of RMI, but the Government has decided not to introduce these at this stage.
The Regulations just give a minor tweak to the existing law on reproduction rights to avoid ambiguity. The Directive provides for the reproduction rights of performers to include transient and incidental copying, so the Copyright, Designs and Patents Act has been extended to cover this, to avoid the implication that performers' rights, by contrast with those of authors, do not extend to such copying.
The changes in this area again reflected the development (at the time) of new technologies, which made the former rights covering 'broadcasting' and 'inclusion in a cable programme service' out of date. As referred to above the changes were aimed at making it easier for rightholders such as the music and film industries to pursue unauthorised use of their works in digital form. Under the Directive, authors must be granted an exclusive right to control electronic communication of a copyrighted work to the public. The Regulations introduced such a right, though the Government was careful to exclude 'static' web pages from the definition of a broadcast. As well as being designed to prevent unauthorised exploitation of copyrighted works using, for instance, internet services, the changes were also designed to provide industries with the opportunity to exploit the possibilities of legitimate distribution made available by the internet.
This brought about a limited exception to the restriction on reproducing a copyrighted work to allow works to be transmitted over the internet (where reproduction by intermediaries, such as ISPs, is necessary to allow transmission). This has already been provided for in the UK under the E-Commerce Regulations. These allow for copying where the ISP is acting as a mere conduit, and where the ISP is merely caching or hosting.
Previously, the defence of fair dealing for research and private study was available to anyone otherwise in breach of copyright. Under the Directive (and the Regulations), this must be restricted to research carried out for a non-commercial purpose provided that it is accompanied by a sufficient acknowledgement. In addition, the Directive states that "rightholders should receive fair compensation to compensate them adequately for the use made of their protected works or other subject-matter". However to date no levy schemes or other forms of compensation have been implemented by the UK Government to address this. In fact the UK Intellectual Property Office took the view in its recent response to the Gowers Review of Intellectual Property that the introduction as recommended by the Gowers Review of a limited form of private copying to allow for format shifting (e.g. from CD to MP3), would be so limited that no levy would be required, much to the consternation of the music industry.
The majority of the provisions were aimed at giving protection to embattled copyright holders, who since the explosion of the internet have been constantly striving to find new ways to protect their assets. They provided the legal support for the practical measures that industries have had to find to protect their copyrighted assets, and opened up certain new avenues for exploitation by rightholders, as demonstrated by the growth since the passing of the Directive of authorised music downloading services (for example Apple's iTunes) and user generated content sites such as YouTube.
Yet the nature of the internet and the speed at which technology is developing means that the law is constantly having to adapt to keep up, particularly as illegal file sharing still remains, in spite of the Directive, a huge problem for the music and other media industries. Whilst the Directive has addressed some problems, such as the ability for copyright owners to employ digital rights management technology, the balancing exception for intermediaries is always subject to scrutiny, as are many of the fair dealing exceptions which are still the subject of analysis (e.g. under the Gowers Review) in the UK. Whilst the rationale for protecting intermediaries has traditionally been that they only provide the facilities through which content is distributed but do not themselves play a role in choosing, editing and displaying it (and that any other position would have stifled the grown of the internet and online services), there is a growing feeling that they should have a part to play, particularly if their commercial success is in some part reliant on the availability of unauthorised content via their services. Indeed the UK Government has only recently outlined its intention to consult on legislation requiring ISPs and rights holders to co-operate in taking action against illegal file sharing if a commercial solution between these cannot be reached, and France has gone one step further by announcing in November 2007 a new scheme between French ISPs and content owners based on a system of warnings leading to disconnection of persistently infringing users. The E-Commerce Directive is still subject to review but if the European Commission bows to the rightholder lobby, this may have a substantial effect on the liability of intermediaries, in particular on the burden of responsibility placed on ISPs and user generated content services to monitor infringing content and prevent it being loaded onto their sites. This outcome would significantly shift the balance once again.
Pinsent Masons is highest ranking professional services firm in FT Diversity Leaders 2020 report