What is a Commission consultation?

A “public consultation” is a process whereby the European Commission asks openly for feedback from the public – from citizens to business – in order to gather input on whether there is problem they should solve, or whether EU actions should focus in certain direction etc.

This consultation is open to everyone to answer. It focuses on copyright, and in particular the creation of a new right for publishers (16 “multiple choice” questions) as well as an exception for “freedom of panorama” (7 “multiple choice” questions). Respondents are free to chose which questions to answer, provided they answer by 15th June.

This consultation is the last opportunity to be heard before the European Commission makes a final proposal for copyright reform in the EU this autumn. Before going ahead, the Commission will look at the answers and infer from them whether there is a problem in relation to news publishers and whether respondents think it is a good idea to create a new right for publishers.

Why is it happening, why now?

German Commissioner Oettinger, who is in charge of copyright, has repeatedly stated (see here and here) he was open to an EU version of the copyright “Google tax”, which is also known as “LSR” (Germany) and “AEDE canon” (Spain).

Some news publishers also continue to argue that EU law, which allows linking and sharing without the authorisation of the copyright owner, needs to be “clarified” to subject these activities to their approval. The European Publishers’ Council for instance argues that use of content through “indexing”, “making available of snippets”, “search engine technology”, should be subject to “permission”. These publishers have also fought hard to obtain legislation in Spain and in Germany.

However, there is increasing opposition to those plans. Some publishers as well as business and civil society associations have strongly opposed this at European level. In July 2015, the European Parliament voted against having a European wide ancillary right in news snippets (see here). Ultimately, over 80 Members of the European Parliament wrote to the European Commission at the end of last year to oppose these plans.

As a result, the proposal is increasingly controversial in Europe and the Commission has decided to consult openly on the matter before going ahead with a final bill in the Autumn. This leaves little time to send a strong signal that this type of legislation is not helpful.

Has this ancillary right in “snippets” achieved anything for publishers in Spain or Germany?

No. In Germany, for example, it has led some publishers to engage in lengthy litigation against news aggregators and others with negative outcomes. In the latest instance, a Berlin court noted that the “win-win” – benefits for users, news publishers and news aggregators such as Google or Bing – would be set off balance should aggregators be forced to pay for snippets.

In Spain, Google News and other services were impacted, resulting in a loss of traffic to news publishers in Spain – and ultimately loss of revenue, particularly for smaller online publishers.

A business association of online services has published a summary of opinions, statements and research on the impact of the Spanish and German laws, which you can find here.

What exactly is the consultation about? A “snippet tax”?

Most likely yes. Some consider that this is not a “link tax” because it only attaches new rights in text snippets. But it’s hard to conceive of links without a short, descriptive text extract or a title.

We also know that some publishers are still pushing for a copyright law that subjects linking to permission. And some recent “leaks” from the Commission continue to be interpreted as indications it is considering a link tax.

Still, things are far from simple. It’s a consultation, with mostly questions – so it’s not clear what exactly the Commission is contemplating. What is clear is that the consultation considers the possibility of an even broader scope for this new “neighbouring” right (note that the name “ancillary” rights came from the translation of the German law, and that “neighbouring” rights is the official wording the Commission uses). It’s broader because the consultation asks whether these rights should be created not just for news publishers, but also for book and scientific publishers. And because it would cover not just snippets but also all other digital and physical activities already covered by copyright.

So essentially we may be looking at a new set of publisher rights for everything published in writing on the internet.

However, there is increasing opposition to those plans. Some publishers as well as business and civil society associations have strongly opposed this at European level. In July 2015, the European Parliament voted against having a European wide ancillary right in news snippets (see here). Ultimately, over 80 Members of the European Parliament wrote to the European Commission at the end of last year to oppose these plans.

As a result, the proposal is increasingly controversial in Europe and the Commission has decided to consult openly on the matter before going ahead with a final bill in the Autumn. This leaves little time to send a strong signal that this type of legislation is not helpful.

How does this harm publishers who want to innovate?

The spirit of the legislation is backward looking. It tries to reverse how the internet and online business works, by forcing publishers of news and other content to charge for indexing and sharing snippets online. That’s a misunderstanding of how things work. It’s counterproductive because it seeks to impose a business model – selling snippets and link – onto a business that is innovating to find new business opportunities and modes.

The effect so far in Spain and in Germany have been negative: it’s led to litigation and some news aggregation services shutting down. That’s less traffic to news sites, and thus less opportunities to find new readers and generate more business. Online publishers suffer the most. In Spain, overall, news publishers are estimated to lose 10 million Euros per year (See here).

If you see Google news, Facebook, Twitter, start-ups and innovation as opportunities for you; if you want to use the internet to build a stronger business; it will get much harder for you. So for example if, like El Diario, your business model relies on creative commons licences that are incompatible with the law.

A new neighbouring right for publishers – wouldn’t that mean more money for me?

No! It’s tempting to believe creating new rights will just make life easier and translate into new cash flows. But that’s not true.

So far, attempts in Spain and Germany have failed to achieve that. Largely because the logic of those proposal is flawed, as they try to “reverse” the way information works on the internet, and get back to the era of print publishing business models. Also because they alter the competitive dynamic online: short term, they reduce digital traffic and revenues for all. Longer term, they hurt the less well-known news brands and news innovators who rely on the web to grow. And they are likely to harm the competitiveness of European publishers online, as non-European publishers compete on a global internet.

An even broader version of this right – applying not just to snippets but all other aspects of copyright – is equally unlikely to provide new revenues. Publishers already get copyright from their journalists, and will continue to need to get copyright contracts from journalists to use their articles. So nothing new here.

In fact, new rights in everything “published” today – most of it on the internet – will mainly create a maze of complexity for lawyers to untangle, and potential for collecting societies to get more and more involved in publishers’ revenue streams, including online. That means more intermediaries, more transaction costs, and also the need for more advice when journalists or publishers themselves use content found on the web. You only have to look at the rather ill-conceived Spanish “canon”: there publishers are deprived of the ability to decide what to do with their content, and forced to let a collecting society charge for it. Whether they like it or not.

Would a new right for news and periodical publishers give us a new competitive advantage to support our digital business?

It would clearly not. Whether in Spain or Germany, the laws yielded no positive impact for news publishers. The harmed the publishers who rely most on the internet to be discovered, as they lost online traffic.

It is impossible to limit a new right to “press” publishers who publish news. Instead, the new right applies to content that is published in writings (“literary works”). Today, most of that is published online. So all the content published online would get this new right – including news or entertainment created under creative commons or written by a public service broadcaster.

So, for example, public service broadcasters who publish news articles online, such as the BBC in the UK or RTVE in Spain would also get the same rights. So would content published on blog – on WordPress alone, that amounts to 58.6 million new posts and 49.9 million new comments each month (see here).

Is this initiative different from the failed laws adopted in Spain and Germany to protect “snippets”?

It is not totally clear what scope of rights the Commission is considering. Commissioner Oettinger, who is responsible for the EU’s copyright policy, has on multiple occasions suggested , modelled on the German or Spanish models.

The Commission consultation hints that the right may not be just limited to use of snippets online, but to books, news and scientific publishers. And that the right would also extend to all activities of publishers, not just use by aggregators: it could cover physical and digital distribution as well. This broader version would be even more damaging, and leading academics are already opposing it.

It would mean every “literary work” (or anything published in writing) on the internet gets a new right. The consequences for online publishing, the internet, to user generated content, web data-analytics, data-journalists, licensing and payments to collecting societies and more are far-ranging and unpredictable.

Does this relate to reprography or private copying “levies”?

The Commission’s consultation does not refer to “reprography” or “private copying” explicitly. These activities fall under a copyright exception, and in exchange, collecting societies collect “compensation” from rightholders.

Some publishers have suggested that a German ruling would require a new neighbouring right. This makes little sense. For instance, news publishers in Spain, the UK or Ireland are totally unaffected by this. Nor are online publishers. It is odd to ask for a new EU law to resolve a German issue. Also, even if there were an issue, the creation of a “new neighbouring right” for all publishers appears out of proportion. It’s a technical, “levy” specific problem.

The connection between reprography and the neighboring right appears artificial and opportunistic – an exaggeration used to argue yet again for a new publisher right.

As a publisher, why should I care?

This is currently being discussed in the European Union as something that publishers want and are actively asking for. If you don’t express a different opinion, that will remain the case. In other words, the tone in Brussels will be that news publishers want new rights that clarify how links and snippets can be used.

Also, this is actually bad for you. There is by now more than enough evidence that these rights are not helpful, counterproductive and not in the interest of all publishers. But it’s also bad for competition and pluralism and for internet users – things you may care about as a publisher or as a citizen.

How will this affect my business?

If a German or Spanish style right is implemented, your online business will suffer as online referrals and traffic decline. In Spain, a study estimated that news publishers alone would see losses of 10 million euros a year as a result of ancillary copyright regulation. In their analysis, smaller or online-only publishers suffered most – as they rely more on the internet to reach new audiences.

The immediate impact of these laws is that traffic from online sites – which drive new audiences to news – declines as it becomes more complex to aggregate and share news and other content online.

For major news publishers in Spain, Germany, France, Italy and the UK, referrals from third party website and services (Google, Facebook, Twitter, email, instant messaging etc.) accounted for 66% of online traffic in 2014. The remaining 34% accessed publisher websites directly. This referral traffic adds up to an estimated €746m in value in 2014, according to Deloitte, value that is under threat from these new rights that attempt to restrict online traffic, or charge for it. There is no real upside to this – people are not going to start buying more print newspapers if it’s harder for them to find your content. A much easier option for readers is to simply read non-European publications online instead.

You may also risk losing control or seeing more of your income managed by collecting societies – both the Spanish and German models failed, but rely on collecting societies to administer the income (whether in law or in practice).

Are there any further risks attached to this “neighbouring right” ?

There is a clear risk that it will impact your digital business, and make it harder for you to build an online presence, as it did in Spain and Germany.

It will also create legal uncertainty and lead to years of hard fought political battles, followed by years of litigation to try and make it work. That will benefit no one.

Even before it goes through, there is a clear risk of the legislation going in of unpredictable and counterproductive directions. EU legislation takes a long time, and involves a broad range of different players. For instance, the debate is likely to lead to a discussion of contractual relationships with journalists, or to the involvement of collecting societies who want to manage new revenue streams.

In terms of the perception of the news and entertainment publishing sector by the EU, it’s not great. First, it’s a highly controversial proposal, and comes at a considerable costs – antagonising internet users and pitching technology against publishers. Publishers will be perceived as not innovating, resisting the digital transition and ready to antagonise internet users. Second, it’ll distract from some other important issues – for instance equal VAT for digital and print, the ongoing EU media regulation review – and reduce the say of publishers around those.

Is it true that lawmakers “forgot” to give news publishers a right of their own?

Who owns these new ancillary copyrights? What are its limits? How do you figure out when it was published, to calculate the when it’s not longer protected? How do you negotiate new contracts when you have deals to lend books, access online database of educational or research materials? A fancy word for this is “legal uncertainty”.

No. It would be incorrect to suggest news publishers do not have a right of their own because they were “forgotten” when copyright was updated for the digital age.

Publishers are like many, many other actors in the creative industries: game developers, app developers, music publishers, film distributors, photographers, managers, and even collecting societies. All these players rely on their contracts with creators to obtain the relevant copyright.

Not having your own right does not mean that your investment is not protected or valued. It means that contracts are how you get copyright. Or should all the people who have copyright contracts get a new neighbouring right?

Also, this is actually bad for you. There is by now more than enough evidence that these rights are not helpful, counterproductive and not in the interest of all publishers. But it’s also bad for competition and pluralism and for internet users – things you may care about as a publisher or as a citizen.

Did lawmakers “forget” the internet when conceiving copyright legislation?

Clearly not. The main EU copyright law is Directive 2001/29. It’s called the “Copyright in the information society directive’. It was designed specifically to protect copyright holders in the internet and digital age. This was done chiefly through the creation of a right to make clear that digital was subject to copyright – the “making available” right.The immediate impact of these laws is that traffic from online sites – which drive new audiences to news – declines as it becomes more complex to aggregate and share news and other content online.

For major news publishers in Spain, Germany, France, Italy and the UK, referrals from third party website and services (Google, Facebook, Twitter, email, instant messaging etc.) accounted for 66% of online traffic in 2014. The remaining 34% accessed publisher websites directly. This referral traffic adds up to an estimated €746m in value in 2014, according to Deloitte, value that is under threat from these new rights that attempt to restrict online traffic, or charge for it. There is no real upside to this – people are not going to start buying more print newspapers if it’s harder for them to find your content. A much easier option for readers is to simply read non-European publications online instead.

You may also risk losing control or seeing more of your income managed by collecting societies – both the Spanish and German models failed, but rely on collecting societies to administer the income (whether in law or in practice).

Would this new right be “legal”?

There is a clear risk that it will impact your digital business, and make it harder for you to build an online presence, as it did in Spain and Germany.

It will also create legal uncertainty and lead to years of hard fought political battles, followed by years of litigation to try and make it work. That will benefit no one.

Even before it goes through, there is a clear risk of the legislation going in of unpredictable and counterproductive directions. EU legislation takes a long time, and involves a broad range of different players. For instance, the debate is likely to lead to a discussion of contractual relationships with journalists, or to the involvement of collecting societies who want to manage new revenue streams.

In terms of the perception of the news and entertainment publishing sector by the EU, it’s not great. First, it’s a highly controversial proposal, and comes at a considerable costs – antagonising internet users and pitching technology against publishers. Publishers will be perceived as not innovating, resisting the digital transition and ready to antagonise internet users. Second, it’ll distract from some other important issues – for instance equal VAT for digital and print, the ongoing EU media regulation review – and reduce the say of publishers around those.

What is freedom of panorama?

For freedom panorama, there is no EU-wide exception allowing the use of photos of buildings (from the Atomium to the light-up Eiffel tower) or of sculptures which are copyright protected. So depending on the country you’re in, uploading such a photo on Facebook on on Wikipedia can be copyright infringement. For example, a Swedish court has recently decided – upon a complaint from a collecting society – that such images on Wikipedia where not permitted.

No. It would be incorrect to suggest news publishers do not have a right of their own because they were “forgotten” when copyright was updated for the digital age.

Publishers are like many, many other actors in the creative industries: game developers, app developers, music publishers, film distributors, photographers, managers, and even collecting societies. All these players rely on their contracts with creators to obtain the relevant copyright.

Not having your own right does not mean that your investment is not protected or valued. It means that contracts are how you get copyright. Or should all the people who have copyright contracts get a new neighbouring right?

Also, this is actually bad for you. There is by now more than enough evidence that these rights are not helpful, counterproductive and not in the interest of all publishers. But it’s also bad for competition and pluralism and for internet users – things you may care about as a publisher or as a citizen.

Is this a “google or snippet tax”?

Many people have referred to this proposal as a “snippet tax”, “Google tax” or “link tax”. The goal of the laws in Spain and Germany was in part to target news aggregators such as Google and charge them for snippets of news text.

This has failed to achieve the desired effect so far. For example, in Spain, where services like Google News, Planeta Ludico, NiagaRank, InfoAliment and Multifriki have already shut down after AC laws were put into place, traffic declined.

In trying to reach this outcome, copyright law has been used. Copyright is like property – it impacts everyone who trespasses on your property, whether Google or somebody else. You can’t write a copyright law that says that there is an infringement of copyright only by Google and that any other use is fair.

As such, the suggestion has been to create a copyright on text snippets from news, making it harder for online services and people to use extracts of text. Because such snippets are often used to make a link (describing what the link is to, for example), some have called this a “link tax”. Just like “Google tax”, this is an approximation.

Whatever the case may be, “text snippets” are used by a much broader variety of online services than just Google to drive traffic to news and entertainment websites. On average, for large press publishers, around a third of traffic comes from direct access (users typing lemonde.fr, elpais.com, repubblica.it etc in their browser). The rest, as shown by research from the Reuters in institute, is traffic coming from search engines such as Google and Bing, news aggregators, social media such as Twitter or Facebook, email, apps, etc.

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