A better solution to making out of commerce works available online.

A week after he presented the Commission’s proposals for a modernisation of the EU copyright rules, Commission Vice President Ansip has followed up with a blogpost in which he explains why the Commission is proposing new rules for the digitization of cultural heritage collections and for the making available of out-of-commerce works in the collections of cultural heritage institutions across Europe.

As we have already pointed out, the proposed new rules for making available out-of-commerce works fall short of what is required to get large parts of these works online. VP Ansip’s blogpost makes it clear that while the Commission has a good understanding of the challenges faced by cultural heritage institutions, it does not appear to understand the mechanics of the actual problem.

In last week’s blogpost Ansip, celebrates the benefits of digital technologies in the provision of cross border access and expressly mentions Europeana as having done good work here and he correctly points out that the large body of out-of-commerce works in the collections of cultural heritage institutions present a special problem that needs to be addressed by copyright law:

Digitisation becomes particularly relevant when collections are out-of-commerce, by which I mean works that are still protected by copyright but no longer commercially available to people. It is usually because the authors and publishers have decided not to publish new editions or to sell copies via standard commercial channels. These works are not generally available in any other way.

But they can still hold great cultural, scientific, educational, historical and entertainment value. They might also be newsreels, photos, unpublished materials, or works never intended for commercial circulation, like political leaflets. From a heritage perspective, they are still important.

[…] Making matters worse are the high transaction costs that cultural heritage institutions incur to clear the relevant licensing rights so that they can proceed with digitisation and disseminating works online.

As a solution to this problem Ansip points to the ‘copyright licensing system’ that is part of the proposed Copyright in the Digital Single Market Directive that the Commission presented on the 14th of September. He continues:

In general, I would like out-of-commerce works to play the full and prominent role that they deserve in our cultural heritage. And for that to be the case, they must be available and accessible online. This is why I favour a copyright licensing system that covers entire collections and gives rights holders full legal certainty across the board.

Unfortunately this is where we think that Ansip (and by extension the Commission’s proposal) gets it wrong. A copyright licensing system such as the one proposed by the Commission cannot produce the results that Ansip expects it to deliver. Such a copyright system will not cover entire collections and will not give rights holders full legal certainty across the board and is not the way for out-of-commerce works to ‘play the full and prominent role that they deserve in our cultural heritage’.

The main reason for this is that there are many cases where there is simply no-one who can grant a license for out-of-commerce works in the collections of cultural heritage institutions. The Commission’s proposal attempts to address this by requiring the EU member states to create a legal basis for extended collective licenses that would allow cultural heritage institutions to make available out-of-commerce works that they have in their collections.

In his blogpost Ansip points to the fact that when we are talking about out-of-commerce works we are talking about newsreels as well as “unpublished materials, or works never intended for commercial circulation, like political leaflets”. In the majority of the EU member states there simply are no collective management organisations that grant licenses for these types of works, and as a result the Commission’s proposal (which works by extending existing licenses to also cover “rightholders of the same category as those covered by the licence who are not represented by the collective management organisation”) will not have any effect for such works.

The category of out-of-commerce works is much broader than works that were commercially available at some point in the past. Out-of-commerce works include works that have never been or were never intended to be in commerce. For these types of works there are generally no collective management organisations that can be relied upon to grant licenses that can then be extended. And without collective management organisations that license these types of works, the Commission’s proposal will not work.

Ignoring the voice of the cultural heritage sector

The Commission’s belief in licensing as a solution for the out-of-commerce problem is illustrative of a problematic pattern. Three years after the largely failed ‘Licenses for Europe’ stakeholder dialogue, the Commission approach to tackling problems posed by copyright still follows a binary pattern: Problems can either be solved by licensing or by exceptions. In the case of out-of-commerce works the Commission has clearly decided the solution should be licensing, and has refused to even acknowledge the above mentioned problems.

These problems are not new to the Commission, we along with leading Libraries, Archives and Museums from across Europe have repeatedly presented them over the last two years. In response, the Commission disregarded our proposal that a solution for the problem should be based on an exception, where licensing solutions fall short.

In its Impact Assessment the Commission does not even acknowledge the possibility of solutions other than licensing for the issue of out-of-commerce works held by cultural heritage institutions.

The only reference to the solution advocated for by the sector that is confronted by the problem, is buried in a single footnote of the impact assessment:

CHIs in the 2013-2014 public consultation stressed the importance of solutions covering all types of works and many of them indicated their preference for an exception, as generally did individual end users/consumers and consumer organisations. CHI respondents also referred to collective management solutions, notably ECL, as an alternative. (European Commission, Impact Assessment, page 71, footnote 212)

In an approach that seems very disingenuous, the Commission ignores these two policy options, and instead compares the same licensing based mechanism with itself and comes to the conclusion that the “option” that applies to more categories of works is better because it applies to more categories of works.

Out-of-commerce works: Option 1 required Member States to put in place legal mechanisms, with cross-border effect, to facilitate licensing agreements for out-of-commerce books and learned journals and to organise a stakeholder dialogue at national level to facilitate the implementation of that mechanism. Option 2 went further since it applied to all types of out- of-commerce works. This extension was deemed necessary to address the licensing of out-of-commerce works in all sectors. Option 2 was therefore chosen. (European Commission, Proposal for the DSM directive, page 7)

It is hard to understand why the Commission has not analysed a policy option that has been presented to them in detail. Comparing the licensing and exceptions would not only have revealed that an exception would apply to more types of works, but also that it would produce tangible results for cultural heritage institutions much quicker.

Licensing is only part of the solution

There are also drawbacks to an exception that would give cultural heritage institutions the right to make available out-of-commerce works in their collections. In sectors with well established collective management, an exception would have a strong impact on the rights of authors and other rights holders, and it could undermine the functioning of existing extended collective licensing arrangements already in place in a number of (predominantly northern) EU member states.

It seems that in making its choice for a solution the Commission has decided to prioritize these concerns over the concerns of the cultural heritage sector and its own initial ambition to present a proposal that works for all types of collections. In doing so it has overlooked what maybe an obvious solution of combining the two approaches to provide a comprehensive solution that addresses the concerns of all stakeholders.

The key to such a solution may be contained in another exception proposed by the Commission. The exception for “Use of works and other subject-matter in digital and cross-border teaching activities” contains a provision that allows member states to “not apply [the exception] generally or as regards specific types of works or other subject-matter, to the extent that adequate licences […] are easily available in the market”. This mechanism could also be employed to combine the copyright licensing system proposed by the Commission with an exception solution as proposed by cultural heritage institutions.

This would allow member states to work with licensing based solution in sectors where such solutions exist, and to rely on an exception in sectors where such solutions do not exist and are not feasible. The exception would need to contain the same safeguards as the Commission’s licensing based proposal, such as the ability for rights holders to opt out, and for the registration of out-of-commerce works in an EU wide database.

Without the addition of such an exception the Commission’s proposal will fail to meet the objectives it’s aiming to support. It would at best constitute another partial solution for the copyright issues faced by cultural heritage institutions, who would continue to struggle with copyright in their attempts to make available the rich cultural heritage of Europe that VP Ansip wants to see preserved online. And as observed by Ansip in his post from last week…

That is something we cannot allow to happen.