At the end of March the European Commission issued a "Notice to Stakeholders. Withdrawal of the United Kingdom and EU Rules in the Field of Copyright." It is a helpful but notably incomplete summary of the legal repercussions of Brexit on copyright law in the UK and EU.
In what ways is the Notice incomplete?
- It assumes that as from the withdrawal date, 30 March 2019, EU rules in the field of copyright will no longer apply in the United Kingdom. That is unlikely to be the case, because the European Union (Withdrawal) Bill now being debated in Parliament provides that on and after that date EU-derived UK legislation will continue to have effect and direct EU legislation (for example, an EU Regulation) will continue to form part of UK law. Moreover, some EU rules have been embedded in UK legislation in ways that mean they will be unaffected by Brexit.
- It omits to mention at least one of the implications of Brexit – see paragraph 1(b) below.
- Inevitably, until we know if the transitional agreement that will govern EU/UK relations for a two year period from 30 March 2019 will preserve reciprocity in the copyright field, it is impossible to say with certainty what the full range of the implications will be during those two years. Moreover, what the situation will be after those two years will depend upon the terms of the trade agreement that the UK will be negotiating with the EU to govern their long-term relationship.
The EU Notice outlines under the six headings used in this Alert the consequences of Brexit in the field of copyright and related rights.
- The Notice draws attention to the fact that the EU Satellite and Cable Directive provides that the act of communication to the public by satellite broadcasting occurs solely in the Member State where the broadcast signals are introduced into an uninterrupted chain of transmissions that lead to the satellite and down to the earth. Thus, satellite broadcasters only have to clear rights in that Member State. Unless the transitional agreement preserves this rule for broadcasts from the UK, the consequence will be that UK broadcasters who uplink their channels in the UK for reception in Europe could have to clear rights in all Member States within the satellite's footprint, a daunting prospect. By contrast, contrary to what is stated in the Notice, the fact that the country of origin rule is embedded in the Copyright, Designs and Patents Act 1988 will have the effect of preserving the rule for EU broadcasters whose signals are receivable in the UK. To give an example of the potential consequences of this, if a presently UK-based broadcaster moved its operations to an EU Member State, it would have to obtain its licence to broadcast music to its UK audiences from the collecting society in its new country of origin.
- There is a curious omission in this section of the Notice, curious because the Notice refers here to the Satellite and Cable Directive but does not address the cable aspect. The Notice fails to mention the effect of Brexit on cable retransmissions of broadcasts from other Member States. The Directive's rule is that in respect of such retransmissions, rights owners (other than broadcasters) may only exercise their rights through collecting societies. The Withdrawal Bill appears intended to preserve this rule in respect of retransmissions in the UK, so that such retransmissions will continue to be facilitated by the Directive's rule. By contrast, unless the Transitional Agreement preserves this rule for retransmissions of UK channels in Member States on and after 30 March 2019, the UK broadcasters will be faced with the possibility of claims being made against them or their cable operator licensees by rights holders who have chosen not to license such retransmissions through local collecting societies.
2. Collective Rights Management
At present, Directive 2014/26 on the collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market creates an obligation on a collective management organisation (a 'CMO') to represent another CMO for such multi-territorial licensing. While the Notice correctly states that, as of the withdrawal date, EU CMOs will not be subject to the obligation to represent UK-based CMOs for such licensing; it does not mention that the apparent intended effect of the Withdrawal Bill is that UK-based CMOs will have to represent EU-based CMOs for such licensing if so requested. Absent a provision in the Transitional Agreement, this disparity will continue.
3. Orphan works
The same disparity will occur in the case of orphan works, where the Orphan Works Directive provides that certain cultural institutions in the EU can benefit from a system of mutual recognition in relation to certain permitted uses of such works. To remove the disparity, the Transitional Agreement and the subsequent trade agreement will need to ensure that online uses made in Europe of orphan works by UK cultural institutions continue to have the cover provided by the Directive.
4. Access to published works for persons who are blind, visually impaired or otherwise print-disabled
Here the disparity arises in relation to the rule created by Directive 2017/1564 that requires Member States to have an exception for the benefit of such disabled persons and authorised entities operating on their behalf, such that (a) any authorised entity may rely on the exception for a beneficiary person or authorised entity in another Member State, and (b) that beneficiaries and authorised entities may have access to accessible format copies from an authorised entity established in any Member State. In the absence of a transitional agreement, print-disabled persons in the UK will not be able to obtain accessible format copies from authorised entities in the EU under the framework of the Directive. Since, the effect of the Directive would not seem to be sufficient to allow authorised entities and beneficiary persons in the EU to obtain such copies from authorised entities in the UK after Brexit, it would certainly seem to be in the EU's interest to cover this point in the Transitional Agreement.
5. Online content portability
As from 1 April this year, by virtue of the Portability Regulation 2017/1128, UK residents have been entitled to access and use their digital online subscription services when temporarily present in other EU Member States; the access and use of the service is deemed for copyright purposes to take place solely in the UK. Unless the Transitional Agreement preserves this rule, UK providers of such services will lose its protection and will have to clear rights in each Member State in which they wish to continue to make their services available to their travelling subscribers.
By contrast, the Withdrawal Bill, when enacted, will preserve the "legal fiction" created by the Regulation in relation to use by EU-based subscribers who are temporarily in the UK of online services provided from EU Member States.
6. Sui generis database right
The beneficiaries of the protection created by the Database Directive are restricted to persons who are nationals of an EU Member State, have their habitual residence in the territory of the EU or are companies formed in accordance with the law of an EU Member State and having their registered office, central administration or principal place of business in the EU. As will be evident from our analysis in the preceding paragraphs of this note, the effect of the Withdrawal Bill, absent a Transitional Agreement that preserves the reciprocal effect of the Directive, is to create a disparity of protection. The Commission's notice is not correct in stating that EU Member State nationals and companies/firms will not be entitled to maintain or obtain a sui generis database right in the UK in respect of their databases. The Withdrawal Bill appears to afford that protection, but a Transitional Agreement is needed to ensure reciprocity.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.