VITORINO REPORT ON COPYRIGHT LEVIES: WILL EUROPE GO FOR A DIGITAL SINGLE MARKET?

EP Hearing

Irena Bednarich, Chair, Copyright Working Group, DIGITALEUROPE

Brussels, September 17 2013

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I. Today’s Creativity EcosystemII. Copyright Levies: what is the issue?III. Vitorino recommendations: what needs to be reformed to make fair compensation fit

with the digital age?

I. Today’s Creativity Ecosystem

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The European Commission’s flagship

initiative “A Digital Agenda for Europe”

put forward an analysis of the virtuous

cycle of the digital economy.

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• A rough justice system from the analogue times• Lack of coherent methodology• Lack of efficient collection systems• Lack of efficient distribution systems

II. Copyright Levies: what is the problem?

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« Une  large partie de ces perceptions ont été absorbés par un système cumulant  jusqu'à 6 sociétés intermédiaires. » (France's 2010 report of the Cour des Comptes)

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European Commission Impact Assessment on CRM Directive:“This means that substantial amounts of  money  are  kept  by  societies  pending  distribution.  Thus,  e.g.  in 2010 major societies had accumulated € 3.6 billions worth of liabilities to rightholders […].”

Lack of efficient distribution systems

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DIGITALEUROPE CALLS UPON

THE EUROPEAN COMMISSION AND

THE EUROPEAN PARLIAMENTTO IMPLEMENT

THE VITORINO RECOMMENDATIONS

III. Vitorino recommendations: what needs to be reformed to make fair compensation fit with the digital age?

• Acknowledgement that levies are an internal market issue.

• Existing and new online services should be based on exclusive right (licensing) rather than on the exception (levies). Major developments in content consumption patterns should be taken into account.

• Licensed copies should not trigger a levy (no double dipping).

• Levies should be paid in the country where the final customer resides (country of destination principle).

• Non-application of levies on professional users: The liability for paying levies should be shifted from the manufacturer/importer to the

retailer's level while simplifying the levy tariff system. Alternatively, clear and predictable ex-ante exemption schemes should be established.

• In the field of reprography, more emphasis should be placed on operator levies than on hardware based levies.

• Defining 'harm' uniformly across the EU, as the value consumers attach to the additional copies in question (lost profit).

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CJEU putting an end to indiscriminate application of levies

Padawan ruling: - Business users should not be paying the levy.

Amazon case: - Requires a priori exonerations for commercial uses. If not possible, right to

reimbursement (effective and not excessively difficult).- Presumption of private use limited to natural persons. Rebuttable and cannot result

on payment for use outside the exception.

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Thank you

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