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Copyright, here’s how the Antitrust pinches the government on copyright

3 years ago babelfish

Copyright, here's how the Antitrust pinches the government on copyright

What can be read in the opinion that the Antitrust has sent to the presidents of the Chamber and Senate and to the Prime Minister on the draft decree that transposes the EU copyright directive.

First: "The Authority believes that the transposition in Italy of the Copyright Directive currently presents significant competitive problems that could compromise the development of the markets relating to the brokerage of rights in the digital context".

Second: “The forecasts indicated above outline an excessively managerial approach, with a pervasive, and often ineffective, intervention by the public authorities that does not encourage the deployment of correct negotiation dynamics and which, moreover, is a harbinger of significant and unjustified competitive discrimination. On the contrary, the spirit of the Copyright Directive requires the development of tools that favor the effective negotiation of rights, on the basis of the free exercise of the negotiating autonomy of the parties concerned and the respect for the principle of freedom of enterprise ”.

Third: “The Authority hopes that the observations made above can be adequately taken into consideration in the context of the transposition process in progress”.

These are the three salient, conclusive passages of the opinion signed by Roberto Rustichelli, president of the Authority for the market and competition, sent to the presidents of the Chamber and Senate and to the president of the Council on the draft decree implementing the EU copyright directive.

Here is the full text:

The Antitrust Authority, in the meeting of 31 August 2021, decided to express the following opinion, pursuant to article 22 of the law of 10 October 1990, n. 287, on the draft legislative decree implementing directive (EU) 2019/790 on copyright and related rights in the digital single market and amending directives 96/9 / EC and 2001/29 / EC (295) ( hereinafter also Copyright Directive), in implementation of article 9 of the law of 22 April 2021, n. 53, Delegation to the Government for the transposition of European directives and the implementation of other European Union acts – European delegation law 2019-2020.

The Copyright Directive addresses two crucial issues related to the use of works, to be understood as cases that can be protected for the purposes of copyright, on the Internet by the large web platforms, namely: the use of journalistic publications by the lenders of the information services and the use of works on sharing platforms, respectively covered by articles 15 and 17 of the Directive.

Apart from possible further profiles of constitutional legitimacy and compliance with the principles of the European Union, in the opinion of the Authority, the draft decree in question introduces, in transposition of the provisions of the aforementioned Directive, provisions which, in addition to being extraneous – and therefore – that do not comply with the principles indicated in article 9 of the Delegation Law (article 77, paragraph 1, of the Constitution), they are also capable of unjustifiably restricting competition.

As for article 15 of the Directive regarding the online use of journalistic publications, article 1, lett. b), of the draft decree introduces article 43-bis of law no. 633 (Law on copyright), in relation to which the following competitive criticalities are highlighted.

On a preliminary basis, the Authority observes that article 15 of the Directive is included among the measures to "protect the proper functioning of the market" and, as such, has a direct impact on the development of the competitive dynamics of the sector and, consequently, it is intertwined with the Authority's intervention to protect competition. In this context, the Authority notes that Article 1, lett. b), the draft decree appears to go beyond the limits set by the European legislator and the parliamentary delegation, introducing subjective and objective cases not envisaged by the Euro-Union regulations and identifying negotiating mechanisms that limit the contractual freedom of economic operators.

The protections granted by the Copyright Directive should not, in fact, be pursued with tools of a publicistic nature – however particularly invasive – and with regulatory interventions that determine unjustified constraints on the negotiating autonomy of the parties and, ultimately, on the functioning of the markets, especially in the absence of evidence about possible market failures. On the contrary, these protections should be guaranteed by allowing the rebalancing between the contractual forces of the parties, also through an enhancement of the role of the entities that professionally and systematically look after the positions of their associates / principals through the negotiation of licenses. In this way, the negotiations for the granting of licenses and for the stipulation of fair compensation would be carried out in compliance with the principles of negotiation and contractual autonomy, especially in markets subject to rapid and profound changes caused by technological innovation and which need to find autonomously its own competitive equilibrium.

Therefore, in order to strengthen the bargaining power of authors and publishers in the negotiation of rights with users and in order to take into account the evolution of the market and the reference discipline, the intermediary role of collective management organizations should be recognized. and independent management entities, referred to in Directive (EU) 2014/26 (the so-called Barnier Directive), implemented by legislative decree no. 35. It is not superfluous to recall how the competition protection legislation has often allowed the competent authorities to sanction and / or resolve the pathological aspects of relations between companies, such as abuses and other forms of competitive restrictions falling within the prohibitions provided for by the European Union provisions and national.

On the other hand, the new article 43-bis of the Copyright Law, currently under examination, in indicating the parameters for defining the amount of fair remuneration, provides for variables such as the duration of the activity and the relevance of publishers, as well as the number of journalists employed, who far from helping to quantify the contribution to the economic result of the aforementioned content, are instead capable of determining improper discrimination against new entrants and smaller publishers, unjustifiably favoring incumbent publishers,

Finally, the draft decree, unlike the provisions of the Delegation Law, does not appear to provide an adequate definition of the concept of "very short extracts", of crucial importance for the distinction between the work that must be the subject of remuneration and its synthetic representation that does not benefit from protection. In particular, according to the draft decree, a very short extract of a journalistic publication must be understood as "any portion of this publication that does not exempt the need to consult the journalistic article in its entirety".

However, the Authority notes that this definition appears to be excessively generic and difficult to apply in practice, thus proving unsuitable for contributing to the certainty of the protection recognized by the Copyright Directive for publishers and authors. The notion of "very short extracts" should therefore be brought back within certain and defined parameters, usually used in the reference sector and immediately applicable, such as the number of characters / characters in the extract.

Furthermore, the Authority notes that the methods of transposition in Italy of Article 15 are not even reflected in the experiences gained in some of the main Member States that have already completed the transposition process,

In particular, the German law, approved on 20 May 2021 and entered into force on 1 August 2021, provides for the recognition of the protection referred to in Article 15 of the Directive through a literal transposition of the text of the Directive, while the French law (law 24 July 2019, n. 2019-775) establishes that the related right can be licensed by publishers and entrusted to one or more collective management organizations for management.

As regards the remuneration due following the exercise of the related right ("fair compensation"), French law provides that: i) this must be calculated on the basis of all direct and indirect income deriving from the use of the right or, failing that, on a flat-rate basis; ii) to determine the amount, all the investments made by publishers and news agencies, the contribution made by the journalistic publication to political and general information and the importance of using journalistic publication for the online communication service must be considered to the public; iii) online communication services to the public (i.e. platforms) are required to provide publishers and news agencies with all the information relating to the use of journalistic publications by their users, necessary for a transparent assessment of remuneration and its breakdown.

With regard to article 17 of the Directive on online content sharing services – whose rationale, as is well known, is to bridge the gap between the economic value produced by a content and the effective remuneration paid to the holders of rights (so-called value gap) – it should first be noted that the European Commission published, on 4 June 2021, the Communication from the Commission to the European Parliament and the Council, Guidelines on art. 17 of Directive 2019/790 on copyright in the digital single market, provided for by article 17, par. 10 of the Directive itself, with the aim of supporting a correct and consistent transposition of this provision in all Member States.

In this regard, it is noted that the Scheme does not appear to adequately transpose the Directive with reference to some fundamental points of article 17, also in light of the guidelines provided by the Commission with the aforementioned Communication.

In the first place, the Authority, similarly to what has already been noted regarding the transposition of article 15 of the Directive, believes that the draft decree has not taken into due consideration the overall framework of the regulations on the management of copyright, as amended following the transposition of the aforementioned Barnier Directive with the introduction of an organic discipline of the requirements and of the supervisory system of brokerage firms to which the right holders can turn, on the basis of a free choice, for the management of copyright, related rights and private copy remuneration. In fact, brokerage firms play a crucial role in negotiating licenses and protecting the rights of their members.

In this context and consistently with the Commission's guidelines, it would be desirable that the legislative declination "of the utmost efforts" that the service provider must put in place to obtain the necessary authorizations, includes the effective involvement of active intermediation firms and whose operations are already subject, by the current legislation, to the verification of compliance with extensive transparency obligations. Likewise, an explicit reference to article 16 (“Granting of licenses”) of the aforementioned Directive no. 2014/26 / EU, which establishes essential principles of negotiations both in relations with users and in relations with rights holders.

In fact, the difficulties that brokerage firms often encounter in affirming their role in front of users are known in the sector and how this involves not only distortions of the competitive dynamics of the sector but also a compression of the legal and economic positions of the holders of rights. The explicit (and necessary) recognition of their role, given the current evolution of the markets, would have positive cascading effects in a broader perspective. The reference to brokerage firms should therefore constitute a recurring element in this, as in all the other provisions of the Scheme of the legislative decree that refer to the negotiation on the use / remuneration of rights.

The common thread that should permeate the draft decree should, in fact, be the development of tools that favor the effective negotiation of rights, on the basis of the negotiating autonomy of the parties concerned and respect for the principle of freedom of enterprise. Collecting are by definition the bodies responsible for stipulating licenses in the name and on behalf of their members and protecting their rights: a strengthening of their role even in the pathological phase of rights management – or in the event of a dispute with online rights providers. – would improve the effectiveness of copyright protection as a whole.

Furthermore, considering that the Copyright Directive is adequately detailed and that the Commission has already published useful guidelines on the subject, the Authority believes that any further level of regulation with respect to the primary transposition legislation risks compromising the homogeneity of the application of the Directive in the Member States, for which it would be more effective to provide for the involvement of existing bodies made up of representatives of the sector (possibly with a specific remodeling, strengthening the presence of brokerage firms), as well as, at the same time, strengthen the mediation tools to be implemented beforehand. to the competent Courts. In any case, the draft decree should specify that the complaints of the interested parties must be easily accessible and free for users.

In light of the foregoing, the Authority believes that the implementation of the Copyright Directive in Italy currently presents significant competitive problems that could compromise the development of the markets relating to the intermediation of rights in the digital context.

In fact, the forecasts indicated above outline an excessively managerial approach, with a pervasive, and often ineffective, intervention by the public authorities that does not encourage the deployment of correct negotiation dynamics and which, moreover, is a harbinger of significant and unjustified competitive discrimination. On the contrary, the spirit of the Copyright Directive requires the development of tools that favor the effective negotiation of rights, on the basis of the free exercise of the negotiating autonomy of the interested parties and the respect for the principle of freedom of enterprise.

The Authority hopes that the observations made above can be adequately taken into consideration in the context of the transposition process in progress.

This opinion will be published in the bulletin pursuant to article 26 of law no. 287/90.

Roberto Rustichelli

This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/diritto-dautore-ecco-come-lantitrust-pizzica-il-governo-sul-copyright/ on Thu, 16 Sep 2021 09:40:09 +0000.