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Controversial EU Copyright Reform Clears Final Hurdle

by Pawel Pokorski, FiscalNote

Is Article 13 the next GDPR?

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EU legislation doesn’t usually get the attention of the likes of Wikipedia, Google, Lady Gaga and Paul McCartney, but a new copyright directive recently signed off on by the  EU member states has done just that.

The EU-wide piece of legislation, has polarized views over the last two years and led to intense lobbying campaigns from both sides of the debate, including input from said celebrities, all pitching in to express their enthusiastic support or vehement criticism of the reform.

What is the Copyright Directive?

Currently, content-sharing services, such as Facebook or YouTube, are not responsible for copyright infringements. It’s up to the rights holders to flag copyright violations with online platforms, who then decide whether to remove the supposedly copyrighted content from their websites.

Article 13, the most controversial provision of the new law shifts the onus for ensuring copyright compliance to the online platforms themselves. Now, platforms will be required to obtain an authorization from the rights holders to provide access to their material. In other words, the content-sharing providers will need to ensure that making the content available on their website does not amount to a copyright infringement.

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If a court finds that their efforts are not sufficient, the platforms could be held liable for copyright violations. According to the European Commission (who came forward with the proposal for the directive in 2016) the move is to ensure that artists, news publishers and journalists receive appropriate pay for their work circulating on the Internet – a principle that is explicitly enshrined in Article 18 of the directive.

Why is this so controversial?

Article 13 specifies that copyrighted material should not be accessible on content-sharing platforms unless the creators of such content have been properly remunerated for it. It does not, however, determine the technical tools or infrastructure, which should be used to prevent copyright infringements from occurring.

Opponents of Article 13 have argued that the only way online platforms can ensure that unremunerated content does not appear on their websites is to implement “upload filters”. Such filters scan the uploaded material – photos, videos, or a Facebook post – to cross-check it against a database of copyrighted works and disable access to the upload if they come across anything similar. Some big tech companies already use similar solutions – YouTube’s “Content ID” being the most famous.

Internet users are not big fans of upload filters, with some arguing they are inaccurate and likely to block legitimate material. Others claim that the use of filters may result in Internet censorship, leading to a general monitoring of the content uploaded by the users and making it easy for platforms to remove material that they disagree with, even if it doesn’t breach copyright.

Europe versus the US?

Although the new legislation aims to limit the power of big technology companies by ensuring that online platforms strike fair remuneration agreements with artists and media houses, the opponents of Article 13 say the directive will in fact reinforce the position of the largest US tech companies.

They argue that only the big players will be able to implement costly content monitoring technologies. That would mean the European tech ecosystem, mainly composed of small and medium-sized enterprises (SMEs), will have no choice but to outsource content monitoring and hand over their data to the US giants, thus jeopardizing the independence of the European tech industry as well as the privacy of EU citizens.

Those opposed to Article 13 seem to acknowledge that the directive contains specific provisions applicable to the SMEs - platforms operating in the EU for less than 3 years, with an annual turnover lower than 10 million euros and average monthly unique visitors fewer than 5 million will be subject to less restrictive obligations than big companies.

The opponents say that the provisions are not sufficiently robust to protect the competitiveness of the smaller players.

Are upload filters really necessary?

As already mentioned, Article 13 does not oblige online platforms to use upload filters. Article 13 advocates maintain that content-sharing services will not need to implement filters if they license the catalogues of big entertainment companies, thus protecting themselves from copyright claims. The content-sharing platforms would simply have to purchase a license on all copyrighted works that come with a digital fingerprint identifying the creator, unless the owner has waived their copyright.

The opponents of Article 13 respond by arguing that licensing agreements cannot possibly cover all of the material uploaded to platforms. According to them, the modern copyright landscape is much more complex than the EU legislators would like it to be, and there are not just a few large rights holders that own the majority of creative works. Licensing, they argue, cannot possibly meet the challenges of the online world, where every Internet user is a potential rights holder, and “upload filters” will most likely have to be used to satisfy the requirements of the directive.

So who is right?

Just what impact Article 13 will have on the freedom of Internet users and the rights of content creators will become clearer once the EU Member States start writing the provisions of the directive into their national laws (a process known as “transposition” in EU jargon). The EU countries have until 2021 to do so.

Ultimately, it will be up to the Member States to decide on the concrete steps that the platforms in their countries will need to take to meet the requirements of the new copyright provisions. The French Minister of Culture, Franck Riester, announced that the French copyright supervisory bodies had been tasked with “promoting and supervising content recognition technologies” – a suggestion that France may opt for upload filters. Meanwhile, the German Christian Democratic Union (CDU), Chancellor Angela Merkel’s party, published a policy brief shortly before the adoption of the directive. The paper indicated that the German government could implement Article 13 not through filters, but by establishing a far-reaching licensing regime.

The attention of lobbyists and ordinary citizens is likely to turn toward their national governments, who will share the unenviable task of navigating the controversy of the copyright reform. It remains to be seen whether making the copyright fit for the digital age will come at the high price of free expression on the Internet.

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