Copyright term extension: back on the agenda

Lurking quietly among the European Union's various IP legislation goals for the last two years is a proposal to extend the term of copyright in sound recordings and performances from 50 to 70 years, starting from the date of fixation or publication.

The IPKat reported on this issue when it was being debated in the European Parliament back in 2008 and 2009, a debate which resulted in Members of the European Parliament (MEPs) voting in favour of an amended proposal which scaled back the term extension from 95 years to 70 years, and included mechanisms to ensure that a percentage of the royalties arising during the extended term would go to session musicians, regardless of pre-existing contractual arrangements.

After the vote, silence ... until now


Then everything went relatively quiet.  Non-European readers might assume that, once the European Parliament voted in favour of a Directive, the law would be adopted, subject perhaps to some sort of Grand Vizier character applying a signature or quasi-monarchical seal to a suitably ornate document, but European lawmaking is rarely so straightforward (or colourful, alas).

The legislative triangle of the EU (by Ssolbergj)

Most legislation requires "co-decision" by both the Parliament and the Council (which is composed of the national governments), as explained in the useful little graphic on the left. When the copyright term extension proposal went to the Council, however, it lost all momentum and appeared to have been placed in cold storage, reportedly due to a blocking minority of countries.

Now, due to the reported thawing of Denmark's position, possibly due to global warming [Merpel says: or as a result of interested lobby groups and countries applying the heat?] the proposal has come out of the refrigerator.  According to the agenda for tomorrow's COREPER meeting, published yesterday, the proposal to amend Directive 2006/116/EC (that's the Term Directive to you and me) is up for deliberation as item 18, suggesting it will be back on the Agenda for the Council to decide before too long (thanks to Alexander von  Mühlendahl for additional clarification).

Incidentally, a group of 40 MEPs, led by Swedish Pirate Party representative Christian Engström, had tried to snatch the ball back from Council in recent months, relying on a procedural mechanism which allows a newly elected Parliament to reconsider items voted by the previously dissolved Parliament, but he reported yesterday in his blog that his attempt had been turned down, leaving the way open for Council to adopt the proposal.


The UK position: Do Ministers listen to Professors?

Various commentators, including Mr Engström, note with some disappointment that the UK appears committed to supporting the term extension, despite having commissioned the Hargreaves Review which advised exactly the opposite. Can this be true, the IPKat wonders?

The Hargreaves Report

Well, it's not precisely true to say that Hargreaves concluded that the UK should vote against term extension, if one reads the Report with a pedantic eye, but on the other hand, Mr Engström's summary is not all that far off the mark.

Professor Hargreaves noted that "IP policy has not always been developed in a way consistent with the economic evidence", and as an example of such legislative short-sightedness he cites exactly these proposals to extend the term of copyright in sound recordings Regarding such extensions he says:

Economic evidence is clear that the likely deadweight loss to the economy exceeds any additional incentivising effect which might result from the extension of copyright term beyond its present levels. This is doubly clear for retrospective extension to copyright term, given the impossibility of incentivising the creation of already existing works, or work from artists already dead.

Despite this, there are frequent proposals to increase term, such as the current proposal to extend protection for sound recordings in Europe from 50 to 70 or even 95 years. The UK Government assessment found it to be economically detrimental. An international study found term extension to have no impact on output.

However, the Hargreaves Report then catches itself in the act of giving advice on something outside its remit, shrugs its shoulders, and makes it pretty clear which way the advice would point if only someone had thought to ask:

Legitimate questions of culture, fairness and “just reward” for creators also arise, and have tended to dominate the debate on copyright issues. Indeed, they were explicitly cited by the previous Government as justification for extension of copyright term, despite the economic evidence. These questions are clearly significant, and it is not part of the Review’s task to determine how they should be resolved. We simply invite Government to consider that as copyright becomes increasingly economically important, it is vital that economic considerations are fully weighed in the balance. ... If the current imbalance in the debate on copyright is allowed to continue, the economic price will be high.

Culture Minister Ed Vaizey © Jon Jordan

So presumably the UK Government took these words to heart, and thought long and hard about the "likely deadweight loss to the economy"?  Culture Minister Ed Vaizey certainly appears to have rather cheerfully suppressed any second thoughts he might have had as a result of such soul-searching.  In a reassuringly concise account of his struggle to balance the various factors and the doubts which Professor Hargreaves' warnings undoubtedly caused him, in July he told the AGM of the British Phonographic Industry:

And while we are in the area of copyright, I would just like to add that the Government will continue to support moves in Europe to extend copyright in sound recordings.

So while Hargreaves (almost) said that extending term to 70 years was a bad idea, and certainly counselled against taking this matter lightly, the UK Government has nevertheless signalled that it will vote for term extension when it comes before the Council.

This Kat finds it disappointing that, despite all the talk of a brave new evidence-based method of making policy, there has been no appreciable change in the UK Government's approach to the wisdom of ever-increasing copyright terms.  This would seem to be a prime candidate for policy reversal or reconsideration, if Professor Hargreaves is to be believed.

Musicians object to political song use

The IPKat notes a letter in today's Times from the Musicians' Union and the Features Artists' Coalition, protesting at the use of songs by the their members on a compilation put together by the British National Party.

They note that many of their members 'have no legal right to object to their music being used in this way' and add that:

'we would also like to raise awareness of the terribly low level of moral rights accorded to musicians in this country and we call for these to be reassessed so that musicians are able to object to their music being used in situations which contravene their beliefs and morals'.

The IPKat can see the correspondents' point of view. If one can object to one's trade mark being used in an unsavoury context, then why not one's literary, musical or artistic work or one's performance, which if anything, is more personal to the author than a trade mark is to the company that it represents. The Kat seems to remember the Musicians' Union raising just this concern at the time that performers' moral rights were brought into force in the UK. The IPKat is somewhat puzzled though. Can the performers not rely on their economic rights? If they've dispensed with them, can they not persuade their labels to take action? Aside from the political ramifications, sure they record labels and the authors of the underlying copyright works don't want the BNP making use of their copyright-protected works for free.

Something to read ...

In "Are performers a special case?" (IPKat, 23 December 08), this weblog hosted a guest post from Amanda Harcourt in favour of an extension of the term of legal protection for the rights of performers in their performances. This post generated some thoughtful comments from (in alphabetical order) Mr Justice Arnold, Ben Challis and William Patry. Another thoughtful commentator is Antony Taubman (Head of WIPO's Traditional Knowledge (Global Intellectual Property Issues) Division) who, writing in his own name and not on behalf of WIPO, penned a 75-page article, "Nobility of Interpretation: Equity, Retrospectivity and Collectivity in Implementing New Norms for Performers' Rights", which was published in 2005 in volume 12 of the Journal of Intellectual Property Law, pp 351-425. For those readers who would like to peruse his thoughts at their leisure, the IPKat is pleased to acknowledge with thanks the publisher's agreement to let him upload the article in full: now you can read it here.

The IPKat's friend Jordan S. Hatcher has recently written a piece for the IP Finance weblog, "Open innovation in the business world".  Since it takes a positive and constructive view of the IP lawyer's role in new business models based on open innovation, the Kat thought it would be a good idea to give it a wider airing.  You can read it here.


The sixth and final issue of Sweet & Maxwell's European Commercial Cases for 2008 contains, as usual, a smattering of intellectual property decisions, in English, from around Europe. This issue gives full-text reports on P Handelsgesmbh v P GmbH, an Austrian Supreme Court decision on the balance between questions of law and questions of fact in relation to the determination of whether an unregistered mark has obtained a certain degree of recognition in the course of trade, and Re Alcatel trade mark, a German Bundespatentgericht decision on the assessment of the overall impression of composite marks where a producer's name was the dominant element of its trade mark. The ECC's website is here.

Are performers a special case?

While almost every serious commentator in the field of contemporary copyright law takes the view that no case has been established for the extension of copyright term in respect of sound recordings, the case for the extension of the protection term enjoyed by performers themselves has at least one doughty advocate.

Right: these worthy performers can be found among the cyber-cats greeting cards, here.

IPKat reader and copyright specialist Professor Amanda J Harcourt writes:

"While Andrew Gowers' article (Copyright Extension is Out of Tune with Reality) makes a number of useful and pithy points, it does not fairly, in my view, state the case for the performer.

While the record companies in the 1990s indubitably "missed the boat" when attempting to debate and adjust their commercial practices to accommodate the developments of the internet - and now are suffering the consequences - there are moral arguments surrounding this new development. The songwriter and performer occupy the only moral high ground in the economic environment that is the music industry. This economic model of copyright has been taken to extreme by record companies. Guy Hands's early pronouncements about executive and administrative waste soon after his purchase of EMI were on point, but an understanding of the way artists are contracted by record companies demonstrates that those at the bottom of the royalty food chain - in this case the artist - have reasons for moral outrage.

Recording artists are " given" an advance to make an album. This advance has to be repaid, and repayment is made through the royalty percentage (between, say, 15% and 25%) the record company agrees to pay the artist. Artists who complete one album, the copyright of which the record company owns, and are on course for their record company to call for a second (or third) album (which the record company will
also own) are provided with a second (or third) advance. As before, this advance or loan has to then be recouped from income generated by sales of the artist's recordings. Money in the form of royalties is payable to the artist after they have recouped their advance - but it is payable in clearly defined accounting periods. If an artist has been lucky enough to recoup their first advance, they would be entitled to royalites which the record company and its subsidiaries have already received, and to be paid at the next accounting date - this is known as "pipeline income". But, if an artist is asked to deliver the next album, and the next advance is paid, the artist's entitlement to royalties is subject to the recoupment of the second advance. Thus, as a matter of accounting for an individual artist, the artist will have been loaned their own pipeline income, and will then have to recoup (or repay) this, their own, money before they once again approach a position where they may, possibly, receive actual royalites in the form of cheques. This is, to be generous, an imaginative economic model.

And, hairdressing salons and other small businesses will not be required to pay "a hidden extra tax" in the form of higher music licence fees. The fees for music use are set by the collecting societies, in the case of the sound recording copyright Phonographic Performance Limited. PPL licenses users and pays the fees across to the record companies whose copyright recordings have been played and to the performers whose performances were on those sound recordings. The societies' activities are regulated by the Copyright Tribunal and unreasonable increases in licence fees requested would certainly be challenged in that forum.

Performers fought long and hard to persuade the UK Government to grant them a statutory right to income from the broadcast and public performance of their performances on sound recordings. It was the intervention of the EU (EC Directive 92/100) that eventually meant the performers shared in this income - income that the record companies alone had been receiving since the 1970s (and had only minimally shared with performers on an ex gratia basis). There was no accompanying great hike in PPL licence fees to accommodate these new rightowners (the performers). The PPL distribution practices were simply altered.

The Directive that improved the lives of performers by giving them so-called secondary income that was not subject to the record companies' recoupment practices arose from the Rome Convention. This was an international convention that began life at the International Labour Organisation before the Second World War. The man that drafted much of the Convention, the late Ted Thompson, advised me that in its original draft, the Convention was to have given this right to broadcast and public performance income to the performers alone. Technological developments during the War prompted broadcasters and record companies to "get in on the act" in revised drafts after the War.

Performers have waited a long, long time to be treated more equitably and we should be pleased for the older and the lessser known, but equally deserving, artists, to whom this extension of term may make a useful financial difference. It is interesting that this concession has arrived at a time when, arguably for some, record companies need performers more than performers need record companies".

The IPKat is curious to know what his readers think. Please let him have your comments below.

UK-IPO response to performers' term extension

The UK IPO appears to have given a rather chilly reception to the European Commission’s proposal to extend performers’ rights to 95 years. A press release quotes the Minister for IP, Baroness Delyth Morgan, as saying:

Because copyright represents a monopoly we need to be very clear that the circumstances justify an extension. We will therefore need to consider these proposals carefully to understand how they would work and what the benefits are likely to be…

She continues by encouraging members of public to contact the IPO with comments on the proposal by the end of August (contact details are in the press release).

The press release goes on to note that the Gowers Review found that an extension of copyright would not be beneficial to either consumers or the industry.

The IPKat agrees. 50 years of protection is hardly derisory. When we alter IP rights, we alter the competitive balance. The balancing exercise is a complex one and knee jerk or populist proposals don’t give the opportunity for this balance to be made adequately. However, the Commission seem to be rather taken with the idea of extending the term.

While the IPKat is on the subject of EU copyright, he neglected to mention last week that the Commission has adopted a decision which prohibits European collecting societies from limiting membership to authors in their particular Member State. Thanks to Maria Mercedes Frabboni for giving him a prod on this. See the IPKat’s comment on the draft of this decision here.

Good news for Sir Cliff and eBay

Commission adopts extended performers rights

The European Commission has today adopted a proposal for 'extending the term of protection for recorded performances and the record itself from 50 to 95 years'. [Press release here]. This is said to benefit both performers and record companies. This is designed to 'bridge the income gap' when the sound recordings of performances made in an artist's twenties expires when they reach their seventies.

At the same time, the Commission appears to be tinkering with more general copyright protection for musical works. According to the press release:

In addition, when it concerns a musical composition, which contains the contributions of several authors, the Commission proposes a uniform way of calculating the term of protection. Music is overwhelmingly co-written. For example, in an opera, there are often different authors to the music and to the lyrics. Moreover, in musical genres such as jazz, rock and pop music, the creative process is often collaborative in nature. According to the proposed rule the term of protection of a musical composition shall expire 70 years after the death of the last surviving author, be it the author of the lyrics or the composer of the music.

The IPKat isn't entirely sure if he has read this correctly, but it looks like the Commission is proposing to lump together musical and literary authorial works set to music and grant a single term. If this is correct, this goes against our traditional notions of how such works are viewed, and the same logic (of treating both works as one) could conceivably apply elsewhere, such as in judging infringement.

The Commission is also launching a Green Paper on on the long-term future of copyright policy in the knowledge intensive areas. This will cover scientific publishing, the digital preservation of Europe's cultural heritage, orphan works, consumer access to protected works and the special needs for the disabled to participate in the information society.

The IPKat notes that this is another example of IP rights being expanded to the max. For one thing, record companies appear to be getting some sort of slice of the pie. The 95 year term is generous (though the Kat notes that this would be an increasingly common lifespan). He remains unconvinced that recording artists have a right to be remunerated for life. The seeming changes to authorial copyright also go for the maximum by extending protection of the whole work to the last to die of the group (previously different elements of the work could potentially come out of copyright at different times.


eBay wins in US

Things are looking up for eBay. A US District Court held on Monday that the internet auctioneer had not infringedTiffany's trade marks in failing to prevent fake Tiffany goods to be sold through its site. According to the New York Times, the court found that it was the responsibility of trade mark owners, and not online retailers, to police the online sites for infringers. The US decision runs counter to the emerging trend it Europe, where eBay has been found to have infringed in both France and Germany.

The IPKat can't help but compare this to Napster. The difference is though that eBay's business model isn't built on third party infringement. Quite the opposite - it creates bad will if consumers unwittingly purchase 'fake' goods. The whole thing's a bit of a mess though. Will this mean that US eBay will need to be blocked off to European consumers?

The Times gets more time

Not available elsewhere, this decision of Mr Justice Warren in Experience Hendrix LLC and another v Times Newspapers Ltd was picked up by subscription service LexisNexis Butterworths. It emanates from the Chancery Division (England and Wales) on 14 December.

Experience claimed it was the owner of (i) the performer's rights in the performances given at the Royal Albert Hall (London, England) in February 1969 by the late Jimi Hendrix, and (ii) the copyright in the sound recordings of those performances. Experience sued the publisher of The Times newspaper, saying that the publisher had infringed its rights by authorising and procuring the manufacture, and the issuing to the public, of compact discs featuring copies of those recordings. The Times denied infringement, pleading that the allegedly infringing acts had actually been licensed. The basis of the defence was the existence of a chain of licences, beginning with a letter from the mid to late 1970s, which gave it a defence under section 180(3) of the Copyright, Designs and Patents Act 1988, which states:

"The rights conferred by this Part apply in relation to performances taking place before the commencement of this Part; but no act done before commencement, or in pursuance of arrangements made before commencement, shall be regarded as infringing those rights".

Experience applied for summary judgment on the ground that The Times had no reasonable prospect of defending the claim; The Times in turn applied to adjourn the application pending the submission of further evidence relating to the purported licences.

Mann J held that, on the evidence before him, The Times had no reasonable prospect of defending the claim. The original letter was not a contractual document and no other evidence of a contractual relationship between the parties existed. However, The Times would be given the chance to obtain further evidence. If no further evidence was forthcomig, Experience would be awarded summary judgment.

The IPKat notes that, at least in this short note of the ruling, the judge was concerned that the arrangement upon which The Times relied was not a contractual document. Secdtion 180(3) does not however stipulate that the arrangements relied upon by the party claiming to be licensed have to be contractual -- even though, in the real world in which copyrights are jealously guarded and profitably exploited, it will generally be the case that a licence will have originated from a contract.

Earlier IPKat posts regarding Jimi Hendrix's pre-1988 performances here and here
Jimi Hendrix fan club on Bebo here
Hear Jimi Hendrix here