However, two recent developments suggest that publishers are now toughening their stance on business photocopying. The Copyright Licensing Agency, which licences principally magazine and journal copying, has been writing to businesses which are not registered under its scheme inviting them to consider registration, and backed its efforts by setting up a Copywatch hotline which, the CLA hopes, will encourage disgruntled employees to report on illicit photocopying at their place of employment. At the same time, the majority of England's national daily and Sunday newspapers have formed themselves into the Newspaper Licensing Agency, and propose to regulate the practice of photocopying newspaper articles by granting licences on a company-wide basis.
This brief update reviews the legal position in relation to photocopying, and summarises the licence terms offered by the CLA and the NLA.
The Legal Background
Does photocopying require licensing?
Photocopying a "substantial part" of a copyright work is an infringement of the UK's copyright legislation (the Copyright, Design and Patents Act 1988), unless it falls within one of the fair dealing exceptions set out in the 1988 Act.
Texts, photographs and illustrations are copyright works, and in many cases the photocopying will be substantial either because:
(a) a large proportion of the relevant work is photocopied. For journals and newspapers, each article is in itself a copyright work, and so copying an article inevitably constitutes the copying of a substantial part.
(b) even where the photocopying reproduces a quantitavely small part of the relevant work, it may well include qualitatively the most important part of the work (e.g. the executive summary or conclusions).
Fair dealing?
Even where photocopying is substantial, however, it may be possible for take advantage of one of the fair dealing exceptions in the Act. For these purposes, the main exception allows photocopying of even substantial parts of works provide that the photocopying is for the purpose of research or private study, and that such copying is, in all the circumstances, fair. It is unlikely that photocopying for business purposes will constitute either private study or research, and in a recent American case Texaco argued that its photocopying of industry magazines was justified as being for research. Texaco lost the case. It is likely that the result would have been the same under English law: the present trend of IP law is to protect the rightholder.
What if you don't have a licence?
Unauthorised photocopying is a breach of copyright and exposes a company to:
(a) legal action for damages (ie. payment of the license fee that would have been negotiated on an arm's length basis: this is unlikely to be substantial),
(b) additional damages (granted where the infringement was particularly flagrant),
(c) criminal prosecution (directed at the company itself and its directors).
However, the biggest sanction is the bad publicity that such legal action generates. Publishers will often be keen to maximise publicity (and, conversely, reluctant to settle out of court or on terms of confidentiality), because the media exposure is often effective in bringing others into line.
In practice, the the piecemeal nature of most photocopying makes it difficult for the CLA or NLA to gather sufficient proof to successfully maintain a legal action. An exception to this, however, is the systematic photocopying of journals and periodicals to save subscription costs. It should also be noted that the most actions are mounted on the back of tip-offs from disgruntled (ex) employees and that, as mentioned above, the CLA has recently introduced an infringement notification line.
The Licensing Schemes
The CLA's Scheme
What publications does the CLA cover?
Although the CLA's scheme only covers works produced in thirteen countries, both the UK and the USA are included. However, the CLA licence does not extend to:
(i) newspapers (this is available, for the main newspapers,
from the NLA - see below)
(ii) information newsletters (until six weeks after publication)
(iii) market reports (until twelve months after publication)
(iv) a relatively small number of works which are on the
excluded list
How much photocopying does it allow?
The CLA licence allows copying of less than 5% of the volume or issue (if a periodical, one whole article) per occasion, and it only authorises a maximum of nine copies on any one occasion (though a further nine copies may be made on a subsequent occasion). For copying outside these parameters, the CLA provides a telephone service by which permission (at extra cost) can be obtained for additional copies.
}The CLA license applies only to paper copying. The CLA has as yet no mandate in relation to electronic copying, storage and transmission, and it seems unlikely to obtain one in the near future.
The NLA's Scheme
Which newspapers does the NLA cover?
The NLA's scheme is restricted to newspapers. All the English (but not Scottish) national daily and Sunday newspapers are covered, including the FT and the Evening Standard, but not The Times and the Sunday Times (though it is expected that these will join soon).
What and how much photocopying does it allow?
An NLA licence allows the making of up to 250 copies of any one article from one of the participating newspaper, provided that each copy carries wording indicating that it is an authorised copy. An unlimited number of articles from one or more newspapers may be copied, but only photocopying for internal management purposes is allowed.
The licence allows the copying of articles only, and does not extend to photographs or advertisements. Like the CLA scheme, it does not extend to electronic storage or transmission, but there may be some movement on this in the near future.
Alternative routes for licensing
Licences can also be obtained from licensed press cuttings services.
How Much do the Licences Cost?
The fees for the two licences are calculated using different principles. Most businesses will require both licences.
Cost of CLA Licence
The CLA's calculates its charges according to the number of professional employees in the busness, and according to the type of business activity. Companies whose business falls into Band A (e.g. research and development) pay £18 per year per professional employee. Companies in Band B (e.g. professional and mechanical engineering) pay £12 per year per professional employee, and companies in Band C (e.g. charities and other non-profit-making organisations) pay £6 per year per professional employee. The CLA also requires a yearly information audit, and this will impose an additional administrative costs. The following gives some indication of the likely fees:
Professional employees 100 500 1000 Band A £1800 £9000 £18000 Band B £1200 £6000 £12000 Band C £600 £3000 £6000
Cost of NLA licence
The NLA makes available two types of licence. Licence B provides for a per copy fee of 2p; since this licence requires the licensee to keep a record of each copy made, it is unlikely to be suitable for most businesses.
Licence A provides for a fee to be calculated in two parts. The first part requires a record of all photocopying to be kept for the first month, the first month's copying being the multiplier for a yearly fee calculated at 2p a copy. The second part is a fee calculated on staff numbers and turnover in accordance with a set tariff.
A business employing 100 people and making 50 copies a day: first part of the licence £260.00 second part of the licence £180.00 total £440.00 per year A business employing 500 people and making 250 copies a day: first part of the licence £1300.00 second part of the licence £ 240.00 total £1540.00 per year A business employing 1000 people and making 500 copies a day: first part of the licence £2600.00 second part of the licence £ 400.00 total £3000.00 per year
This article is correct to the best of our knowledge and belief at the time of publication. It is however, written as a general guide, so it is recommended that specific professional advice is sought before any action is taken.