Ref. Ares(2017)5138443 - 20/10/2017
Email from Julia REDA to the Cabinet of the Commisioner Maryia Gabriel (copyright
academic studies), 08/08/2017, (Ref. Ares(2017) 3952025)
Email from Julia REDA to the Commisioner Maryia Gabriel, 20/08/2017 (Ref.
Ares(2017) 4911834) with attachment:
Better regulation for copyright - Collected submissions by the academics (Pdf
Format) available at https://juliareda.eu/events/better-regulation-for-copyright/
Ref. Ares(2017)3952025 - 08/08/2017
REDA Julia <email@example.com>
08 August 2017 10:13
CAB GABRIEL CONTACT
REDA Julia (EP)
Copyright- academic studies overview
Dear Commissioner Gabriel, dear Team,
following your discussion with Ms Reda, I'm sending you the academic studies evaluating different parts of
the European Copyright reform proposal.
*General - EU copyright reform
An academic perspective on the copyright reform
Stalla-Bourdillon, Sophie, Rosati, Eleonora, Turk, Karmen, Angelopoulos, Christina, Kuczerawy,
Aleksandra, Peguera, Miquel and Husovec, Martin http://ac.els-cdn.com/S0267364916302394/1-s2.0-S0267364916302394-main.pdf?_tid=77e880e0-7b52-
**A publisher’s intellectual property rightImplications for freedom of expression, authors and open
Prof. dr. Mireille M.M. van Eechoud, Institute for Information Law, Faculty of Law, University of Amsterdam http://www.openforumeurope.org/wp-content/uploads/2017/01/OFE-Academic-Paper-Implications-of-
**Is an EU publishers’right a good idea? Final report on the AHRC project: Evaluating potential
legal responses to threats to the production of news in a digital era
Dr Richard Danbury, Centre for Intellectual Property and Information Law, Faculty of Law, University of
**Neighbouring rights for publishers: are national and (possible) EU initiatives lawful?
Eleonora Rosati, University of Southampton, School of Law https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2798628
**An EU related right for press publishers concerning digital uses. A legal analysis
Alexander Peukert, Goethe University Frankfurt am Main https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2888040
**The Remunerated Statutory Limitation for News Aggregation and Search Engines Proposed by
the Spanish Government - Its Compliance with International and EU Law
Raquel Xalabarder, Chair of Intellectual Property, Universitat Oberta de Catalunya https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2504596
The impact of introducing new article 32.2 of the Spanish Copyright Act
NERA Economic Consulting study commissioned by Spanish Association of Publishers of Periodical
**Why a reform of hosting providers’ safe harbour is unnecessary under EU copyright law
Eleonora Rosati, University of Southampton - School of Law https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2830440
**On Online Platforms and the Commission’s New Proposal for a Directive on Copyright in the
Digital Single Market
Dr Christina Angelopoulos, Centre for Intellectual Property and Information Law (CIPIL), University of
**Online platforms and the Digital Single Market: towards responsible policy-making?
Aleksandra Kuczerawy, Centre for IT & IP Law , Faculty of Law of the University of Leuven https://www.law.kuleuven.be/citip/blog/online-platforms-and-the-digital-single-market-towards-responsible-
**Cut Out By The Middle Man: The Free Speech Implications Of Social Network Blocking and
Banning In The EU
Patrick Leerssen, Institute for Information Law (IvIR) https://www.jipitec.eu/issues/jipitec-6-2-2015/4271
Policy Advisor, Parliamentary Assistant to MEP Julia
ASP 05F162, Rue Wiertz 60, 1047, Brussels, Belgium
Tel. +32 2 28 37732
Ref. Ares(2017)4911834 - 09/10/2017
Envoyé de mon iPhone
Début du message transféré :
"REDA Julia" <firstname.lastname@example.org> Destinataire:
"GABRIEL Mariya (CAB-GABRIEL)" <email@example.com> Objet: Thank you for your keynote at "Better regulation for copyright"
thank you once again for giving the keynote at our event "Better regulation for
copyright". The event was a great success and will hopefully have set the tone for
this debate for the coming months. Without your active support, it would not have
been possible to provide this forum for dialogue between academics and policy-
Please find attached the collected submissions by the academics in pdf format,
which is also available for download from the event web page, where you can also
find a recording of your keynote speech, followed by the remainder of the
All the best,
Member of the European Parliament
Vice-Chair Greens/EFA Group
ASP 5F158, Rue Wiertz 60, 1047 Brussels, Belgium
Office: +32 (0) 228 45732 - Mobile: +49 (0) 176 23992041
Web: http://juliareda.eu - https://twitter.com/senficon
MEP Julia Reda
link to page 7 link to page 8 link to page 11 link to page 11 link to page 14 link to page 16 link to page 17 link to page 17 link to page 21 link to page 21 link to page 25 link to page 30 link to page 31 link to page 35 link to page 38 Contents
Neighbouring Right for Publishers
The proposed press publishers’ right: an actual solution?
The proposed publishers’ right in press publications: an eviden-
The Press Publishers’ Right in a Nutshell
Filtering obligations and fundamental rights: can the EU eat the
cake and have it too?
Addressing the value gap on user-generated content platforms
from the perspective of weaker copyright holders
Form and Substance in the Value Gap Proposal
Copyright on Data
Data producer’s right: Powers, Perils and Pitfalls
Text & Data mining Issues
Data Property: Unwelcome Guest in the House of IP
All contents are under Creative Commons CC-BY licence, unless otherwise specified
Neighbouring Right for Publishers
The proposed press publishers’ right: an actual solution?
Article 11 of the draft Directive on copyright in the Digital Single Market contains a provision
that, if adopted in the form proposed by the European Commission, would introduce a new
neighbouring right at the EU level in favour of press publishers for the digital use of their press
The proposal has attracted significant commentary. This brief note discusses whether – from
a copyright perspective – the idea of an EU-wide press publishers’ right: is supported by an
internal market rationale which justifies an intervention at the EU level; will grant press publish-
ers broader and more certain protection than the one already enjoyed under the EU copyright
acquis; will improve press publishers’ ‘bargaining position’ as per the Commission’s stated in-
Overall, the answer appears to be in the negative. This contribution holds the view that – at best
– a press publishers’ right will not change the situation of its beneficiaries and – at worst – will
increase the complexity of the legal system and distract the attention from other options that
could be potentially more effective in supporting the European press publishing sector.
The content of the proposal
Under the umbrella of its Digital Single Market Strategy1 and among a number of other legisla-
tive proposals, in the final part of 2016 the European Commission released a proposal for a new
directive on copyright in the Digital Single Market2 (‘DSM Directive’).
With the declared goal of helping press publishers “increase their legal certainty, strengthen
their bargaining position and have a positive impact on their ability to license content and
enforce the rights on their press publications”3, the draft DSM Directive contains a provision
which, if adopted in the form proposed by the Commission, would introduce a new neighbour-
ing right over press publications for their digital use. The rationale of the proposal stems from
awareness of the difficulties facing press publishers when seeking to license their publications
and prevent unauthorized uses by online services.4
Entitled ‘Protection of press publications concerning digital uses’, Article 11 of the draft DSM Di-
rective would mandate upon Member
States to provide publishers of press publications with the
rights of reproduction and making available to the public, as envisaged by Directive 2001/295
(the ‘InfoSoc Directive’), for the digital use of their press publications. Such rights would leave
intact and in no way affect – including by means of deprivation – any rights of authors and other
* Associate Professor in Intellectual Property Law, University of Southampton. Email: firstname.lastname@example.org.
1 European Commission, Communication from the Commission to the European Parliament, the Council, the Eu-
ropean Economic and Social Committee and the Committee of the Regions, A Digital Single Market Strategy for
Europe, COM(2015) 192 final.
2 Proposal for a Directive of the European Parliament and of the Council on copyright in the Digital Single Market,
3 European Commission, Commission staff working document – Executive summary of the Impact Assessment on
the modernisation of EU copyright rules accompanying the document Proposal for a Directive of the European Par-
liament and of the Council on copyright in the Digital Single Market, SWD(2016) 302 final, 3.
4 European Commission, Commission staff working document – Impact Assessment on the modernisation of EU
copyright rules accompanying the document Proposal for a Directive of the European Parliament and of the Council
on copyright in the Digital Single Market and Proposal for a Regulation of the European Parliament and of the Council
laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broad-
casting organisations and retransmissions of television and radio programmes, SWD(2016) 301 final, 155.
5 Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of
certain aspects of copyright and related rights in the information society, OJ, L 167, 10-19.
rightholders, in respect of the works and other subject-matter incorporated in a press publica-
With a similar tone, the CEIPI Opinion considers that the proposal for a press publishers’ right
tion. The duration of this new neighbouring right would expire 20 years after the publication of
would: fail to contribute to the construction of a Digital Single Market; be contrary to the inter-
the press publication.6
ests of authors; be unsupported by a clear economic rationale; be detrimental to the public do-
main; apply to any publication, including those in respect of which the relevant press publisher’s
investment has not been substantial; and have an excessive duration.12
Criticisms of the proposal
The Commission’s proposal for a press publisher’s right has been subject to extensive commen-
The Parliamentary debate
tary and possibly even more extensive criticism, notably within academic circles.
Having already expressed critical views
Further to the release of the Commission’s proposal for a DSM Directive, the discussion moved
7 regarding the introduction of a press publishers’ right
at the EU level further to some national experiences – notably Germany (sections 87f, 87g and
to the European Parliament, where MEP Therese Comodini Cachia was appointed rapporteur on
87h of the Urheberrechtsgesetz, ie the German Copyright Act)) and Spain (Art. 32 of the Ley
behalf of the Committee on Legal Affairs (JURI).
de Propriedad Intelectual, ie the Spanish Intellectual Property Law)8 – at the time (2016) of the
On 10 March 2017 a first draft of her report on the proposed DSM Directive was released.13 MEP
Commission’s Consultation on the role of publishers in the copyright value chain9, in early 2017
Comodini Cachia appeared to take a rather radically different view regarding the desirability of
the European Copyright Society (ECS) referred once again to the proposal for a neighbour-
having an EU-wide press publishers’ right. In fact, she proposed that press publishers would be
ing right in favour of press publishers in negative terms. Overall sceptical regarding the actual
granted, not a neighbouring right over their press publications, but rather (and more simply) a
achievement of its underlying goal (this being to support a struggling newspaper industry),
presumption of representation of authors for the sake of rights enforcement (Amendment 52):
the ECS also stated that an exclusive right to control the exploitation of press contents online
would “not only negatively affect freedom of expression and information, but also distort com-
“Member States shall provide publishers of press publications with a presumption of rep-
petition in the emerging European information market.”10 The latter would be because of higher
resentation of authors of literary works contained in those publications and the legal ca-
barriers of entry to the online news market that would make it more difficult for emerging busi-
pacity to sue in their own name when defending the rights of such authors for the digital
nesses to access it.
use of their press publications.
The position of the ECS echoes similar views expressed in late 2016 by a group of 37 intellectual
In mid-2017 MEP Comodini Cachia announced that she was renouncing her role at the European
property professors based in the UK, and the Opinion the Centre for International Intellectual
Parliament, and MEP Axel Voss was appointed new rapporteur on the proposed DSM Directive.
Property Studies (CEIPI) at the University of Strasbourg.
The final version of the Report is scheduled for adoption in the final part of 2017.
In a letter sent to the Copyright Policy Directorate of the UK Intellectual Property Office, a
In the meantime, other Parliamentary committees have expressed views for the Committee
group of 37 professors from a number of UK universities considered that the Commission’s
on Legal Affairs on the proposed DSM Directive. In its Opinion (Rapporteur: MEP Catherine
proposal for a press publishers’ right would be “unnecessary, undesirable, would introduce an
Stihler) the Committee on the Internal Market and Consumer Protection (IMCO) held the view
unacceptable level of uncertainty and be unlikely to achieve anything apart from adding to the
that there are no sufficient grounds that would justify the introduction of a press publishers’
complexity and cost of operating in the copyright environment.”11
right.14 To ameliorate enforcement of rights, it would be sufficient to amend Article 5 of Direc-
tive 2004/48/EC15 (the ‘Enforcement Directive’) by means of a regulation that would make this
provision also applicable to press publishers. The Opinion also holds the view that “[t]here are
potentially more effective ways of promoting high-quality journalism and publishing via tax in-
centives instead of adding an additional layer of copyright legislation.”16
Other Committees have also proposed amendments to the original Commission’s proposal,
especially for the sake of clarifying the scope of the resulting right. In its draft Opinion (Rap-
6 The full text of Article 11 is as follows:
porteur: MEP Marc Joulaud), the Committee on Culture and Education (CULT) deemed it neces-
Article 11 Protection of press publications concerning digital uses
sary to clarify that non-commercial and private uses of professional17 press publications are not
1. Member States shall provide publishers of press publications with the rights provided for in Article 2 and Article
covered18, and that protection does not extend to acts of hyperlinking, or to the text fixating
3(2) of Directive 2001/29/EC for the digital use of their press publications.
the hyperlink, where such acts do not constitute communication to the public under the InfoSoc
2. The rights referred to in paragraph 1 shall leave intact and shall in no way affect any rights provided for in
Union law to authors and other rightholders, in respect of the works and other subject-matter incorporated in a
press publication. Such rights may not be invoked against those authors and other rightholders and, in particular,
12 C Geiger – O Bulayenko – G Frosio, Opinion of the CEIPI on the European Commission’s copyright reform pro-
may not deprive them of their right to exploit their works and other subject-matter independently from the press
posal, with a focus on the introduction of neighbouring rights for press publishers in EU law, 28 November 2016, 2-3.
publication in which they are incorporated.
13 Committee on Legal Affairs, Draft report on the proposal for a directive of the European Parliament and of the
Council on copyright in the Digital Single Market, 2016/0280(COD).
3. Articles 5 to 8 of Directive 2001/29/EC and Directive 2012/28/EU shall apply mutatis mutandis
in respect of
14 Committee on the Internal Market and Consumer Protection, Opinion of the Committee on the Internal Market and
the rights referred to in paragraph 1.
Consumer Protection for the Committee on Legal Affairs on the proposal for a directive of the European Parliament
4. The rights referred to in paragraph 1 shall expire 20 years after the publication of the press publication. This
and of the Council on copyright in the Digital Single Market, <RefProc>2016/0280</RefProc><RefTypeProc>(COD),
term shall be calculated from the first day of January of the year following the date of publication.
7 European Copyright Society, Answer to the EC Consultation on the role of publishers in the copyright value chain,
15 Corrigendum to Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the
15 June 2016, available at https://europeancopyrightsocietydotorg.files.wordpress.com/2016/06/ecs-answer-to-ec-
enforcement of intellectual property rights (OJ L 157, 30.4.2004), OJ L 195, 16-25.
16 Committee on the Internal Market and Consumer Protection, Opinion of the Committee on the Internal Market and
8 For the content of these national legislative initiatives, see further E Rosati, ‘Neighbouring rights for publishers:
Consumer Protection for the Committee on Legal Affairs on the proposal for a directive of the European Parliament
are national and (possible) EU initiatives lawful?’ (2016) 47(5) IIC 569, 573-574.
and of the Council on copyright in the Digital Single Market, cit, 4.
9 European Commission, Public consultation on the role of publishers in the copyright value chain and on the ‘pan-
17 Committee on Culture and Education, Draft opinion <CommissionResp>of the Committee on Culture and Edu-
orama exception’, 23 March – 15 June 2016, available at https://ec.europa.eu/digital-single-market/en/news/public-
cation</CommissionResp> <CommissionInt>for the Committee on Legal Affairs</CommissionInt> on the propos-
al for a directive of the European Parliament and of the Council on copyright in the Digital Single Market, <Ref-
10 European Copyright Society, General Opinion on the EU Copyright Reform Package, 24 January 2017, 6
Proc>2016/0280</RefProc><RefTypeProc>(COD)</RefTypeProc>, Amendment 24.
11 L Bently, Call For Views: Modernising the European Copyright Framework, 5 December 2016, available at http://
18 Ibid</RefTypeProc>, Amendment 18.
19 Ibid, Amendment 24.
In a similar fashion, the Opinion (Rapporteur: MEP Zdzisław Krasnodębski) of the Committee on
solutions.”22 While it appears that such initiatives have failed to achieve their underlying goal,
Industry, Research and Energy (ITRE) recommended the inclusion of a new recital that would
no support is provided as regards the existence of a direct connection between their alleged
state that “[t]he rights for press publishers should apply without prejudice to the rights of indi-
ineffectiveness and lack of cross-border or EU-wide effect.
viduals for the reproduction, communication or providing links or extracts of a press publication
In this sense, the internal market rationale of the proposal remains obscure. The IA and the pro-
to the public for private use or not-for-profit, non-commercial purposes.”20
posed DSM Directive also fail to clarify in what sense the introduction of an EU-wide neighbour-
ing right would satisfy the additional requirements of subsidiarity and proportionality.
(2) A broader and more certain protection?
While awaiting further developments at the level of EU legislature, this note will only consider
Despite extensive criticisms, the scope of the proposed press publishers’ right is not broader
whether – from a copyright perspective – the idea of an EU-wide press publishers’ right:
than the protection already available under existing legislation. Not only will the rights of repro-
• is supported by an internal market rationale which would justify an intervention at the
duction and making available to the public be akin to those already envisaged under the Info-
Soc Directive and relevant case law of the Court of Justice of the European Union (CJEU), but
the new neighbouring right will be also subject to relevant copyright exceptions and limitations
• will grant press publishers broader and more certain protection than the one already
under national copyright regimes (Recital 34 of the proposed DSM Directive), further to Article
enjoyed under the existing acquis;
5 of the InfoSoc Directive.
There is probably no need to recall that the latter provision has been criticised extensively for
• will improve press publishers’ ‘bargaining position’.
failing to establish a harmonised system of copyright exceptions and limitations across the EU.23
Overall, the answer appears to be in the negative. While this brief note does not touch upon
The optional nature of Article 5 exceptions and limitations (with the exclusion of the exemption
potential issues connected with fundamental rights (notably freedom of expression and infor-
for temporary copies), together with the different language, conditions and – therefore – result-
mation) and competition law, it holds the view that the adoption of a press publishers’ right is
ing scope of exceptions and limitations at the national level, is such that the substantive scope
unlikely to change the situation of press publishers. It could however increase the complexity
of copyright protection across the EU varies.24 In this sense, the resulting press publishers’ right
of the legal system and distract the attention from other options that could be potentially more
would not be different, including with regard to the application of the national exceptions (spe-
effective in supporting the European press publishing sector.
cifically mentioned at Recital 34 of the draft DSM Directive) for quotation and news reporting.
(1) An internal market rationale?
(3) A stronger bargaining position?
Similarly to the other EU copyright directives, the legislative basis for the proposed DSM di-
Declining revenues in the press publishing sector are not a new phenomenon (in some Member
rective is Article 114 of the Treaty on the Functioning of the European Union (TFEU), ie the
States the decline began with the advent of television). However, they have become particu-
realisation of an internal market where the free circulation of goods and services based on or
larly problematic since the early 2000s25, with some indicating the internet and news aggrega-
incorporating copyright content is ensured. All this is premised upon the idea that differences
tion services as primarily responsible for such phenomenon. These considerations have been
in Member States’ laws are such as to raise barriers to such free circulation. As in all cases of
the main factor supporting the adoption of a (waivable) neighbouring right in Germany and the
shared competence, such as copyright and – more generally – intellectual property, the direc-
reform of the quotation exception, by means of the introduction of a (non-waivable) fair com-
tive must also satisfy the requirements of subsidiarity (Article 2(2) TFEU) and proportionality
pensation requirement, in Spain.26
(Article 5 of the Treaty on European Union).
Considering both current practices (notably the fact that employed journalists do not usually
With regard to the proposed press publishers’ right, neither the draft directive nor the accom-
own the copyright to the articles they author and freelance journalists are regularly asked to
panying Impact Assessment (‘IA’) provide a satisfactory explanation as to why intervention at
assign the copyright in their own contributions) and existing national arrangements, one could
the EU level is needed. In particular, the IA provides contradictory inputs. It recalls that a num-
wonder whether a specific press publishers’ right is really needed at the EU level. It appears that
ber of Member States has already intervened to remedy or reduce – whether by means of ad
a presumption of transfer of rights (as proposed by MEP Comodini Cachia) would be sufficient
initiatives or as part of broader arrangements – the negative impact of reduced revenue
to achieve the goal of easier rights enforcement, if this remains the principal objective of a leg-
in the press publishing sector. Such copyright-related initiatives include: the introduction of
islative initiative in favour of press publishers.
neighbouring rights (as is the case in Germany); provisions on collective works; provisions on
It is unlikely that either initiative, ie a neighbouring right or a presumption of representation,
presumption of transfer; copyright protection of the typographical arrangement of published
would help press publishers have a stronger bargaining position or recoup part of the revenue
editions; and mandatory fair compensation requirements (as is the case in Spain).21
lost to the Web. With particular regard to the latter, from the data provided by the press pub-
Focusing specifically on the German and Spanish experiences, ie recent initiatives specifi-
cally designed for the benefit of press publishers, the IA itself acknowledges that these have
been somewhat “ineffective”, and links such ineffectiveness to “the lack of scale of national
22 Ibid, 161.
23 PB Hugenholtz, ‘Why the Copyright Directive is unimportant, and possibly invalid’ (2000) 22(11) EIPR 499, 501.
In the same sense, see MC Janssens ‘The issue of exceptions: reshaping the keys to the gates in the territory of lit-
erary, musical and artistic creation’, in E Derclaye (ed) Research handbook on the future of EU copyright (Edward
Elgar:2009), 332, and bibliography cited in it. For similar criticisms, expressed at the proposal stage, see M Hart ‘The
20 Committee on Industry, Research and Energy, Opinion <TitreType></TitreType><CommissionResp>of the Com-
proposed directive for copyright in the information society: nice rights, shame about the exceptions’ (1998) 20(5)
mittee on Industry, Research and Energy</CommissionResp> <CommissionInt>for the Committee on Legal Affairs</
EIPR 169, 169–170.
CommissionInt> <Titre>on the proposal for a directive of the European Parliament and of the Council on copyright
24 See further E Rosati, ‘Copyright in the EU: in search of (in)flexibilities’ (2014) (2014) 9(7) JIPLP 585, 590-594,
in the Digital Single Market, 2016/0280</RefProc><RefTypeProc>(COD), Amendment 18.</Titre>
questioning to what extent diverging implementations of Article 5 exceptions and limitations are allowed by the
21 European Commission, Commission staff working document – Impact Assessment on the modernisation of EU
copyright rules accompanying the document Proposal for a Directive of the European Parliament and of the Council
25 G Price, Opportunities and challenges for journalism in the digital age: Asian and European perspectives (2015)
on copyright in the Digital Single Market and Proposal for a Regulation of the European Parliament and of the Council
Chatham House--The Royal Institute of International Affairs, available at http://www.asef.org/images/docs/
laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broad-
casting organisations and retransmissions of television and radio programmes, cit, 188 .
26 See further, Rosati, ‘Neighbouring rights’, cit, 569-570 and 573-574.
lishing industry and included in the Commission’s Impact Assessment, it cannot be inferred
The proposed publishers’ right in press publications: an
that the positive trends associated with growth of digital revenue are due to the existence of a
copyright environment in which press publishers benefit from an ad hoc
Dr. S.J. van Gompel, Institute for Information Law (IViR), University of Amsterdam
From the brief analysis conducted above it would appear that the Commission’s proposal on
a press publishers’ right is not firmly supported by an internal market rationale. It is also un-
One of the most controversial features of the European Commission’s proposal for a Directive
likely to improve the position of press publishers substantially, possibly with the exception of
on copyright in the Digital Single Market is the provision introducing a related (or ‘ancillary’)
enforcement scenarios in which a less pervasive measure, eg a presumption or representation,
right for publishers of press publications (art. 11 CDSM proposal).2 As it is currently proposed,
this provision would grant publishers of press publications a set of broad exclusive rights of re-
production and communication to the public to authorise digital uses of their press publications
Lacking a clear basis that justifies the introduction of a new neighbouring right at the EU level
until 20 years after first publication, subject to the same exceptions and limitations that apply to
from a copyright perspective, other types of solutions – also indicated in the various parliamen-
copyright works. Effectively, it would mean that, unless an exception or limitation applies, prior
tary committees’ opinions – could be explored to support the press publishing sector, whether
authorization would have to be obtained from publishers for any digital reproduction (direct or
at the national or EU levels.
indirect, temporary or permanent, by any means and in any form) and any making available of
their press publications, in whole or in part, including possibly the smallest snippets.3 This right
is offered in addition to existing copyrights protecting the content (articles, photographs, illus-
trations, etc.) of newspapers, magazines, journals and other periodicals.
In the past year, fierce criticism has been raised against the proposed publishers’ right, both
by academics,4 independent publishers5 and other stakeholders, including creators in the news
publishing industry.6 In this contribution, the key points of criticism will be analysed and dis-
cussed in the light of the EU’s objective for ‘better regulation’. After a short introduction into
the background of the proposal, the paper will elaborate on four main objections against the
proposed publishers’ right. It will conclude that, in view of the evidence available, it is clear that
the proposal is ill-suited to address the problems that press publishers are facing. Therefore, the
proposed publishers’ right should at best be removed from the legislative agenda or at worst
be replaced by a presumption that publishers represent the authors’ copyright in press publica-
tions and have the right to sue in their own name against digital infringement of that copyright,
as was proposed in the draft report of the European Parliament’s JURI committee of 10 March
1 The research for this paper was conducted in the framework of the research programme Veni with project num-
ber 451-14-033 (‘The challenge of evidence-based intellectual property law reform: Legal pragmatism meets doctri-
nal legal reasoning’), which is partly financed by the Netherlands Organisation for Scientific Research (NWO).
2 European Commission, Proposal for a Directive of the European Parliament and of the Council on copyright in the
Digital Single Market, Brussels, 14 September 2016, COM(2016) 593 final, art. 11.
3 See the Impact Assessment accompanying the proposal (SWD(2016) 301 final, Brussels, 14 September 2016), p.
157 (n. 485), referring specifically to the CJEU’s Infopaq I
judgment (Case C-5/08), in which it was held that captur-
ing 11-word text fragments of newspaper articles constitutes a reproduction in part of these works under art. 2(a)
Directive 2001/29 ‘if the elements thus reproduced are the expression of the intellectual creation of their author.’
e.g. ‘EU Copyright Reform Proposals Unfit for the Digital Age’, Open Letter from European Research Centres
to Members of the European Parliament and the European Council, 24 February 2017, available at: <http://www.cre-
ate.ac.uk/wp-content/uploads/2017/02/OpenLetter_EU_Copyright_Reform_24_02_2017.pdf>, p. 3-5 and the refer-
ences to independent studies and opinions contained therein.
e.g. News Now, ‘Common Position Statement on the proposed EU Directive on Copyright in the Single Mar-
27 European Commission, Commission staff working document – Impact Assessment on the modernisation of EU
ket’, 28 February 2017, available at: <http://www.newsnow.co.uk/eu-link-tax/publishers-position-statement.html>.
copyright rules accompanying the document Proposal for a Directive of the European Parliament and of the Council
e.g. Platform Makers, Response to the internet consultation on modernising EU copyright of the Ministries
on copyright in the Digital Single Market and Proposal for a Regulation of the European Parliament and of the Council
of Economic Affairs, of Education, Culture & Science and of Security & Justice in the Netherlands, 1 December 2016,
laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broad-
available at: <https://www.internetconsultatie.nl/modernisering_eu_auteursrecht_dsm/reactie/59245/bestand>, p.
casting organisations and retransmissions of television and radio programmes, cit, 175-176.
Background to the proposal
Key objections against the proposal
A central point that the Commission wishes to address by the introduction of the press publish-
Objection 1: A publishers’ right is unnecessary as press publications are already protected
ers right is the future sustainability of the quality press, which according to the Impact Assess-
ment is in jeopardy. As this ‘would be prejudicial for the media pluralism, good quality informa-
It is somewhat awkward that the Commission is proposing a new related right in press publi-
tion and the role [press publishers] play in democratic societies’,7 the Commission believes that
cations, the content of which normally already benefits from copyright protection. Most press
legislative intervention at EU level is needed.
articles, photographs, illustrations, etc. are protected by copyright, which is usually transferred
to press publishers before publication. Accordingly, press publishers often enjoy copyright pro-
In a nutshell, the problems that press publishers are facing stem from the fact that they have
tection in their press publications due to a transfer of rights by journalists, photographers, il-
been struggling to cater to the two-sided market of readers and advertisers in the digital en-
lustrators, etc.16 Press publishers nevertheless complain that licensing and enforcement in the
vironment.8 In recent years, press publishers have seen a significant decline in print readership
digital environment is complex and inefficient, as they are not recognised as rightholders in
due to structural changes in consumer behaviours. In the past, it were traditional outlets such
their own right.17 But this raises the question: Why would existing copyright not be a good
as newspapers, radio and TV channels that brought news to the people, but nowadays, most
enough instrument to protect the interests of press publishers? And why would they be helped
news is consumed on the internet, through different digital formats and online sources. Data
by the introduction of an additional layer of rights, which essentially grants a similar type of
provided by the press publishing sector show a steady decline in print circulation of daily news-
papers in eight EU Member States, although the differences between countries are noticeable,
varying from an 8% decline in Belgium, to an 18% decline in the UK and a 52% decline in Italy in
The Commission maintains that the introduction of a self-standing intellectual property right
the period 2010-2014.9
in press publications is needed to tackle the legal uncertainty that press publishers face when
licensing and enforcing rights in the online environment.18 But that argument cannot convince.
Concomitantly, press publishers have seen structural changes in advertising markets. Advertis-
Although it may be easier for press publishers to negotiate licenses if they have their own right,
ing takes place where audiences can best be reached. As a consequence, online advertising
they can already license on the basis of the copyright that is contractually obtained from jour-
has grown at the cost of traditional off-line advertising. This has affected news publishers in
nalists and other content creators. To the extent that press publishers face difficulties to prove
particular, as advertisers tend to favour search engines, social media and other channels over
that they own the copyright in press articles (i.e. to establish the chain of title of all rights in their
news media.10 News publishers have also lost their position in the advertising market for jobs,
publications), the legal uncertainty they face is unmistakably the result of a lack of adequate
housing, (used) cars and tourism, which on the internet is controlled predominantly by special-
rights administration and not of a market failure. This could simply be cured through improved
ised platforms and online marketplaces.
rights administration and does not warrant the introduction of a new press publishers’ right.
As a result of these developments, news publishers have witnessed a persistent decline in turn-
over over the past years, both in terms of sales and advertising revenues, which is expected to
Objection 2: The proposed right does not fix the problems of the press
continue in the near future.11 This has already caused news publishers to close down or reduce
Although sometimes met with scepticism, the problems that news publishers are facing with
editorial staff,12 thus leading to a decline of quality of the free and pluralist press. If, due to their
the transition from print to digital are real and should be taken seriously.19 They might warrant
poor financial situation, press publishers can make less resources available to conduct quality
legislative action, but the idea that introducing a press publishers’ right would help to cure the
journalism, they may indeed lose ‘gatekeeping’ power. This threatens the traditional function
existing problems of print media in the digital environment is mistaken. Clearly, neither the
of the press as a ‘public watchdog’13 and may put citizens’ access to information at risk. Ulti-
behaviour of news consumers nor the advertising market will change as a result of the intro-
mately, such state of affairs could be detrimental to public debate and the proper functioning
duction of a press publishers’ right. Accordingly, the proposal by no means addresses the key
of a democratic society.14
underlying drivers of the problem.
To ensure the sustainability of a free and pluralist quality press, news publishers have called for
Moreover, while the Commission assumes that the proposed press publishers’ right will have a
a new ‘ancillary right’ that enables them to (a) take legal action against online infringements of
positive effect on media pluralism,20 the relationship between the two is unclear. In general, it is
their publications, and (b) license their publications to online service providers, such as social
difficult to establish a causal effect between intellectual property rights and incentives to invest
media, news aggregators and search engines, which currently provide unauthorized access
in content creation,21 let alone to demonstrate that a publishers’ right will aid media pluralism.
to press publications made freely available online by news publishers. This has resulted in the
Even if it would yield additional income for publishers, it cannot be automatically assumed that
proposed press publishers’ right, which is aimed at protecting the investments of publishers in
the money will be invested in journalistic efforts. Hence, there is no evidence that the introduc-
producing press publications.15
tion of a press publishers’ right will result in better news coverage or the creation of more di-
verse media content.
The proposal may even have adverse effects on media pluralism, as it is uncertain how online
service providers will respond to the introduction of a press publishers’ right. If they will refuse
to engage in licensing negotiations with publishers and stop providing access to newspaper
contents, as Google News and other news aggregators initially did in Germany and Spain where
7 Impact Assessment, op. cit.
, p. 161.
8 M.M.M. van Eechoud, ‘A publisher’s intellectual property right: Implications for freedom of expression, authors and
16 Europe Economics, L. Guibault & O. Salamanca, Remuneration of authors of books and scientific journals, transla-
open content policies’, study conducted on commission from OpenForum Europe, January 2017, par. 2.3.
tors, journalists and visual artists for the use of their works
, Brussels: European Commission DG Connect 2016, avail-
9 Impact Assessment, op. cit.
, Annex 13A.
able at: <http://www.ivir.nl/publicaties/download/remuneration_of_authors_final_report.pdf>, p. 73-83.
10 Van Eechoud 2017, op. cit.
, p. 14.
17 Proposal for a Directive on copyright in the Digital Single Market, op. cit.
, recital 31.
11 Impact Assessment, op. cit.
, Annex 13A.
18 Impact Assessment, op. cit.
, p. 160.
, p. 156 (reporting on outcomes of the 2016 public consultation on the role of publishers in the copyright value
19 R. Danbury, ‘Is an EU publishers’ right a good idea?’, Final report on the AHRC project: Evaluating potential le-
gal responses to threats to the production of news in a digital era, University of Cambridge, 15 June 2016, available
13 The European Court of Human Rights has consistently emphasized the role of the press as “public watchdog”.
D. Voorhoof et al & T. McGonagle (ed. sup.), Freedom of Expression, the Media and Journalists: Case-law of the
copyright_and_news/danbury_publishers_right_report.pdf>, p. 11.
European Court of Human Rights
(IRIS themes, vol. III), Strasbourg: European Audiovisual Observatory 2016.
20 Impact Assessment, op. cit.
, p. 161.
14 Proposal for a Directive on copyright in the Digital Single Market, op. cit.
, recital 31.
e.g. N. Elkin-Koren & E.M. Salzberger, The Law and Economics of Intellectual Property in the Digital Age: The
15 Proposal for a Directive on copyright in the Digital Single Market, op. cit.
, recital 32.
Limits of Analysis
, London & New York: Routledge 2013.
similar, though narrower, rights in press publications have been introduced,22 this may have
Objection 4: The proposal is overly broad
negative effects on the accessibility of news online and will certainly lead to a fall in referral traf-
Apart from the questionable assumptions that underlie the proposal, there are further ambigui-
fic to newspaper websites. This may be harmful for small press publishers, in particular. A 2017
ties, in particular regarding its beneficiaries and scope. Even if the proposal would aid press
study shows that, after the introduction of the obligation to pay compensation for online use of
publishers, it goes way further than what is required to protect the quality press. The definition
news articles in Spain, the traffic to Spanish newspaper websites fell by a 5.3% decline in visits
of ‘press publication’ (art. 2(4) CDSM proposal) is so broad that it covers virtually all content
on average, with a decline of 4.9% for large newspapers, 6.3% for medium-sized newspapers,
published periodically under a heading of news. The beneficiaries of the proposed right are thus
and 12.6% for small newspapers.23 As a result, press publishers attract significantly less advertis-
not only the quality press, but all periodical media, including newsletters, blogs, glossies, social
ing revenue, which in Spain is estimated to be around ̈ 9-18 million annually in the short term.24
media, etc. It goes without saying that not all these media play an equally important role in
The EU legislator should not take such effects lightly, but examine them seriously before even
democratic societies and they certainly are not in a similar situation of crisis as the quality press.
considering to introduce a press publishers’ right. This is particularly important in light of new
In respect of its scope, it is unclear why the proposal affects all online users of news, including
business models in online news publishing, which are still in development, as the Commission
consumers and other legitimate users, if the real intention is to target the use of press articles
also acknowledges.25 Caution is warranted, as it is uncertain how the introduction of a press
by social media, news aggregators and search engines. Furthermore, do press publishers really
publishers’ right will affect traditional as well as future business models, including the B2B li-
need broad exclusive rights, if they merely seek ‘to participate in the advertising revenues gen-
censing market for online news publications.
erated by their content on third parties’ websites’?28 And why is a 20-years term of protection
proposed, if the commercial life span of most press articles is no longer than a day, a week or a
Objection 3: The proposed right is possibly bad for authors of press publications
month at most? These are all questions to which the Commission’s proposal does not provide
An additional concern is that the proposed press publishers’ right might have a negative im-
pact on journalists, photographers, illustrators and other creators, whose works are included in
The proposal further leaves unanswered what exactly will be protected: would the right protect
news articles. Although the proposal clearly states that the press publishers’ right ‘shall in no
press publications, including
the content they comprise, or merely the fixation of press publica-
way affect any rights provided for in Union law to authors and other rightholders, in respect of
tions as identifiable media items? In the latter case the right seems useless, as online service
the works and other subject-matter incorporated in a press publication’,26 it cannot be excluded
providers seldom reuse or provide access to media items as a whole, but rather offer snippets
that it will nevertheless affect them.
to their content. If the right would also protect the content
of a press publication, however, then
This is especially the case for journalists, photographers, illustrators and other creators who
this might extend the scope of protection beyond that of copyright protection. Brief and simple
work as freelancers. To establish a name and reputation, which is crucial for their work and busi-
news items that contain little expression apart from facts, such as ‘news of the day’ or ‘miscel-
ness, freelancers need maximum exposure of their work online. A press publishers’ right might
laneous facts having the character of mere items of press information’ are outside the scope of
hinder that. As Van Eechoud explains: ‘If the operation of the proposed publisher’s right were
copyright,29 but would arguably be protected under the proposed press publishers’ right.30 Not
to lead to a decline in referrals, shares, snippet-linking or the ability to blog about a journalist’s
only would this be contrary to the Berne Convention, but it would also impair the free flow of
works, this would directly harm the journalist’s visibility, and thus opportunity to sell future
Also, the proposal may worsen the bargaining position of journalists and other content cre-
ators. There is no guarantee that, after the press publishers’ right is introduced, more money will
become available to compensate for the online use of press articles. If the pie would grow, the
The proposal for a related right for publishers of press publications is flawed. Although the prob-
surplus will presumably be taken by press publishers in the exercise of their related right. If the
lems that print media are facing in the online environment are real, there is no evidence that a
pie remains the same, there is a reasonable chance that press publishers on the basis of their
press publishers’ right will meaningfully contribute to addressing these problems. Also, there is
related right will demand a larger share of it, in which case journalists, photographers and other
genuinely no need for a new right in press publications, as news publishers often already benefit
creators would need to take a loss.
from copyright protection contractually obtained from journalists and other content creators.
In response to the draft impact assessment that accompanies the proposal, the European Com-
mission’s Regulatory Scrutiny Board also observed that ‘[t]he report should more convincingly
demonstrate that the creation of a new standalone right for news publishers would effectively
contribute to reinforcing their role in the digital world and that action at EU level is needed.’31
In my view, it still makes no case for why the introduction of a press publishers’ right is needed.
Various European Parliament’s committees that are looking into the matter also seem to recog-
nize that the evidence is against the proposal. The CULT Committee’s draft report of 6 February
2017 advised to significantly limit the proposal and the draft report of the IMCO Committee of
20 February 2017 even suggested to abandon the press publishers’ right altogether. The sug-
gestion to replace the right with a presumption that publishers represent the authors’ copyright
in press publications and have the right to sue in their own name against digital infringement
22 §87f-h German Copyright Act grants press publishers a one-year exclusive right to prohibit the use of ‘snippets’
(not being individual words or the smallest of text excerpts) by search engines and news content aggregators; Art.
32(2) Spanish Intellectual Property Act contains an obligation for content aggregators to pay compensation to news
publishers for the use of ‘snippets’ of press publications.
28 Impact Assessment, op. cit.
, p. 157.
23 NERA Economic Consulting, Impact on Competition and on Free Market of the Google Tax or AEDE fee
specifically art. 2(8) Berne Convention: ‘The protection of this Convention shall not apply to news of the day
for the Spanish Association of Publishers of Periodical Publications (AEEPP), 2017, available at: <http://www.aeepp.
or to miscellaneous facts having the character of mere items of press information.’
com/pdf/Informe_NERA_para_AEEPP_%28INGLES%29.pdf>, p. 59.
30 The proposal contains neither a threshold for protection, such as the originality criterion in copyright, nor a carve-
, p. 62.
out to exclude ‘news of the day’ or ‘miscellaneous facts’ from the scope of protection.
25 Impact Assessment, op. cit.
, p. 157.
31 European Commission, Regulatory Scrutiny Board, Opinion on DG CONNECT’s draft impact assessment report
26 Proposal for a Directive on copyright in the Digital Single Market, op. cit.
, art. 11(2) and recital 35.
on the modernisation of EU copyright rules (version of 1 July 2016), Ref. Ares(2016)3846527, 22 July 2016, available
27 Van Eechoud 2017, op. cit.
, p. 5.
at: <http://ec.europa.eu/smart-regulation/impact/ia_carried_out/docs/ia_2016/sec_2016_0407_en.pdf>, p. 3.
of that copyright, as was made in the draft report of the JURI Committee of 10 March 2017, is
The Press Publishers’ Right in a Nutshell
probably easier to reach political agreement on. But in the absence of final votes on their posi-
tions, all is still out in the open.
Accordingly, the European Parliament has an important task ahead to make right what is wrong.
I. Current Market Failure Necessitating the Proposed Right
Admittedly, this task is not easy. Still, the EU legislator should be very cautious to create a new
right without having a clear picture of all its intended and unintended consequences. Lawmak-
The proposed right reacts to new technical opportunities for the mass-copying of press publi-
ing is not a process of trial-and-error. It actually has bearing on the subjects targeted by the
cations combined with strong economic incentives for companies to take advantage of these
legislation. As the potential impacts of the proposal on the position of journalists, on media
pluralism, on future business models and on the B2B licensing market are not yet assessed,
thoughtfulness and caution are warranted.
1. New Technical Means to Copy Press Publications en masse
Some 20 years ago, when the current InfoSoc directive 2001/29 was drafted, there was no need
for an independent publishers’ right. It was simply not economically viable for any company to
copy and distribute newspapers and magazines en masse. Today, as a result of digitalisation,
this is a different story of course. Press publications can be replicated and distributed globally
through various digital platforms in the blink of an eye.
2. Strong Economic Incentives to Copy Press Publications en masse
There are not just new means to mass-copy, there are also strong economic incentives for com-
panies to do so. This incentive is inherent in the internet ecosystem. It constitutes the standard
business model of the internet economy to publish attractive content on one’s website in order
to attract internet users for advertising or subscription purposes. The easiest way to do that,
of course, is to take the content from other websites and to display it on one’s own site. The
economic success of such aggregation platforms depends on bundling and presenting as much
content as possible. More content attracts more users and more users mean higher advertising
revenues or subscription fees. Consequently, every aggregator has an economic incentive to
display as much third-party content as possible directly on its site.
This also applies to news intermediaries. There are many examples for such aggregators. They
systematically index and copy third party news websites in order to set up their own news out-
let. To this end, they have typically pre-installed news categories on their homepages. Users
are presented with the most relevant text extracts that are often sufficient to convey the key
message and thus the value of the article. If a user clicks on any of the news extracts copied
from third party news websites, even more third party content becomes visible. Users are then
invited to comment or to otherwise interact with the aggregating website. Thus, aggregators
use third party press publications to build up own monetisable customer relationships and to
ultimately keep users away from the source and on their own website. That explains why ac-
cording to the Commission’s Impact Assessment, 47% of all users of aggregators do not click
through to a press publishers’ site anymore.1
3. Aggregators’ Free-riding on Press Publishers’ Efforts Distorts Competition and Eliminates In-
centives to Invest and Innovate
Now, if nearly half of the users of such aggregators do not click through to publishers’ sites
but remain on the aggregator’s site, it is apparent to me that we are not talking about a sym-
biosis here between aggregators and press publishers or even a win-win-situation as has been
claimed by others. Instead, many aggregators are directly competing with press publishers’
sites for the same advertising budgets by satisfying the same information demand of the same
users. Regrettably, at the moment, they are also competing with the same content that the
press publishers produce at high costs and that the aggregators merely copy at no costs. This
is a classical market failure that needs to be addressed. The legal framework has to ensure that
press publishers’ incentives to invest in reliable, high-quality publications are maintained. That
in turn is a traditional function of copyright law. The publisher’s right as proposed by the EU
Commission is capable of addressing this issue.
* Prof Dr Thomas Höppner, professor of business and IP law at Technical University Wildau, visiting professor of law
at University of Strathclyde, Glasgow; partner with law firm Hausfeld LLP, Berlin.
1 European Commission ´Staff Working Document, Impact Assessment on the modernisation of EU copyright rules’
(SWD(2016) 301 final), 14.9.2016, p. 157.
II. The Proposed Right Strikes the Right Balance of Interests
Contrary to all the scaremongering from the side of aggregators, there are no substantial rea-
sons for anyone to be afraid of the proposed right. It strikes a fair balance.
1. The proposed right does not limit but strengthens consumers’ access to news
First, it has been argued that the publishers’ right somewhat limits the flow of information and
the ability of consumers to express their opinions freely.2 However, it is difficult to see how
the proposed right could have such effects. Press publishers vigorously defend the freedom of
expression. Why would they want to prevent their readers from engaging with their publica-
tions? That is neither the purpose nor any likely effect of the publishers’ right. The right does
not protect any ideas or facts that are published. Everyone remains free access to the press
publications published online. And everyone remains free to comment on any subject covered
by a publication, to quote it, to link to it or to share it with others. Recital 33 of the proposed
directive clarifies that the proposed right “does not extend to acts of hyperlinking” which are
typically used for sharing and referencing purposes.
2. The proposed right supports a continuing availability of quality news
The critics ignore that the alternatives to a publishers’ right would interfere much more signifi-
cantly with the freedom of expression and consumers’ access to information than a publishers’
right. Without a better protection of publishers’ online investments, press publishers would be
forced to either invest less in quality content, make less content available online or to hide that
content behind paywalls and subscription models. Each of these alternatives would leave con-
sumers worse off. It is the consumers who benefit the most from the press publishers’ current
approach of making news available for free and anyone online. Aggregators’ unrestricted copy-
ing of this content is threatening this approach.
3. The proposed right does not harm but back up journalists by empowering the entire press
Another point of criticism is that the publishers’ right could in some way harm journalists by
decreasing their public exposure.3 Again, it is difficult to see how this could happen. It would
be surprising if there was any journalist who would not prefer being paid to merely being visible
online but unpaid. The publishers’ right aims at securing the sustainability of the entire press
including its journalists. Empowering the press with an updated legislation is the best measure
politicians can do to secure a diverse and open media landscape.
4. The narrow definition of a “press publication” appropriately restricts the rights’ scope
Another criticism that has been raised is that the right was apparently too wide as it had no
built-in restrictions.4 In fact, the proposed right contains a very important built-in restriction,
that is the definition of the term “press publication”. To be protected, the publication must be,
inter alia, “a fixation of a collection of literary works of a journalistic nature within a periodical
or regularly-updated publication under the initiative, editorial responsibility and control of a
service provider.” These criteria are not easy to fulfill. They require substantial and continuous
investment and justify particular protection.
5. The proposed right is narrower than that for other media publishers
The proposed publishers’ right is not wider but in fact narrower than comparable related rights
for music producers, film producers or broadcasting organisations. Their protection is granted
for certain activities, namely for the mere first technical fixation of a phonogram, a film or a
broadcast, irrespective of the quality, relevance or originality of these activities. There is no
legitimate reason to treat press publications any differently. If anything, considering their rel-
evance for democratic societies, press publications merit additional legal protection not less.
That is why the proposed publisher`s right merits support.
2 EDiMA, Directive Copyright in the Digital Single Market: The impact of Article 11 – publisher rights, 2017, p. 7, 16.
3 Van Eechoud
, A publisher’s intellectual property right: Implications for freedom of expression, authors and open
content policies, OpenForum Europe 2017.
Filtering obligations and fundamental rights: can the EU
eat the cake and have it too?
Setting the problem
The European Commission in its explanatory memorandum to the proposed new Copyright
Directive in the Digital Single Market1 released on 14 September 2016 states that the proposal “has a limited impact on the freedom to conduct a business and on the freedom of expression
and information, as recognised respectively by Articles 16 and 11 of the Charter, due to the miti-
gation measures put in place and a balanced approach to the obligations set on the relevant
2 The European Commission, however, does not explain how the mitigation mea-
sures and its balanced approach meet fundamental rights requirements and does not even ad-
dress the risk that its proposal could lead to divergent interpretations across and within Mem-
ber States. Notably, the European Commission does not even refer to all the fundamental rights
taken into account by the Court of Justice of the European Union (CJEU) when undertaking its
own balancing exercise, including the rights to data protection and privacy (which were consid-
ered in the Promusicae/Sabam
3 and Scarlet/Sabam
4 cases).5 The European Commission’s im-
pact assessment is not of great help either in this respect.6 The European Commission seems to
rely on the fact that, implicitly, the choice of restriction is left, in the first instance, to the service
providers meaning that it is not directly imposed by the transposing legislation.
It is therefore crucial to determine whether the proposed Copyright Directive strikes an appro-
priate balance between the different fundamental rights at stake in the light of CJEU case law
and in particular, whether Article 13 is compatible with the EU acquis broadly defined including
the Charter of Fundamental Rights of the European Union (the EU Charter).
Article 13 of the proposed Copyright Directive in its first paragraph provides that:
“Information society service providers that store and provide to the public access to large
amounts of works or other subject-matter uploaded by their users shall, in cooperation
with rightholders, take measures to ensure the functioning of agreements concluded with
rightholders for the use of their works or other subject-matter or to prevent the availabil-
ity on their services of works or other subject-matter identified by rightholders through
the cooperation with the service providers. Those measures, such as the use of effective
content recognition technologies, shall be appropriate and proportionate. The service pro-
viders shall provide rightholders with adequate information on the functioning and the
deployment of the measures, as well as, when relevant, adequate reporting on the recogni-
tion and use of the works and other subject-matter.”
It thus expressly prescribes the use of effective content recognition technologies as a means to
ensure the functioning of agreements with rightholders or to prevent the availability of copy-
right works. Recital 38 is more explicit in that it specifies that the obligation to “take appropri-
ate and proportionate measures to ensure protection of works or other subject-matter, such as
implementing effective technologies” “should also apply when the information society service
providers are eligible for the liability exemption provided in Article 14 of Directive 2000/31/EC.”
* Associate Professor in Information Technology Law, University of Southampton, UK.
1 European Commission, Proposal for a directive of the European Parliament and of the Council on copyright in the
Digital Single Market, Brussels, COM(2016) 593 final (Proposed Copyright Directive).
2 Proposed Copyright Directive, p. 9.
3 Case C275/06 Promusicae
, Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL
(SABAM), 29 January 2008, EU:C:2008:54, para. 64.
4 Case C-70/10, Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM), 24
November 2011, EU:C:2011:771, e.g. para. 50.
5 For a similar point see e.g. Stalla-Bourdillon S et al. (2016), A brief exegesis of the proposed Copyright Directive,
6 Commission Staff Working Document - Impact Assessment on the modernisation of EU copyright rules - Part 1,
SWD(2016) 301 final.
In other words, hosting providers, as a species of intermediary providers, should also implement
plenty EU companies develop their businesses based on code sharing platforms.14 Furthermore,
effective technology, by which one should understand content recognition technology, also im-
value created by online platforms does not necessarily relate to the use of copyright works but
plicitly equated to upload filters as content recognition technology is described as a measure of
also to the use of personal data relating to service users (in particular data about content con-
its own to prevent the availability of copyright works. Crucially, the implementation of upload
sumption and content sharing habits) for service personification and advertising purposes in
filters implies both the screening of online material and the removal of material matching refer-
the context of highly concentrated markets. As a result, Article 13 as a means of redistributing
ence files of copyright works. It also implies filtering for all file types (audio, audiovisual, pho-
value between online platforms and rightholders can only be a very approximate tool unable to
tography, text) and all protected works, irrespective of their lengths (e.g. including snippets).
cater for complex value creation processes with multiple stakeholders.
Can the European legislature decide to require mandatory upload filters to the detriment of
Upload filters are a reality. Google’s Content ID15 is probably the most well-known example.
certain online platforms defined as “information society service providers that store and pro-
However, this is an expensive technology and only few online platforms use them.16 YouTube
vide to the public access to large amounts of works or other subject-matter uploaded by their
claimed in 2016 to have invested more than $60 million in Content ID.17 Could the technology
?7 Could it be that such a requirement would prove incompatible with the EU acquis and
be then realistically licensed for a few hundred euros? Ironically, making upload filters manda-
the protection of fundamental rights? To say it bluntly, are mandatory upload filters and funda-
tory would thus strengthen the market position of dominant online platforms. This is also sup-
mental rights friends or foes? Can the EU legislature impose ex ante
filtering obligations upon
ported by the fact that neither Article 13 nor Recitals 38 or 39 clarify whether online platforms
certain online platforms and still argue that the proposed Copyright Directive is fundamental
will be permitted to use the reference files corresponding to copyright right without requesting
rights compatible? More prosaically, can the EU legislature eat the cake of fundamental rights
and have it too?
Even if upload filters are already a reality, the EU legislature should be asking itself whether
upload filters should be made mandatory, for a significant number of market players and for all
Assessing mandatory upload filters in the light of fundamental rights
types of protected works (e.g. including code-sharing platforms and software).
A crucial reason why making upload filters a requirement for certain online platforms is an ill-
Mandatory upload filters are the wrong answer to a poorly formulated problem, confusingly
conceived policy is its incompability with fundamental rights. This has been explained by the
referred to as the “value gap”
The European Commission in its memorandum ex-
CJEU in a series of cases starting with the landmark Scarlet/Sabam
case and followed by the
plaining the new proposed copyright Directive states that “
[i]t is therefore necessary to guar-
case.18 In Netlog
, in particular, the CJEU clearly highlighted the intimate relation-
antee that authors and rightholders receive a fair share of the value that is generated by the
ship that exists between a cornerstone of the digital single market legal framework, i.e. Article
use of their works and other subject-matter.”
9 Implicit in this statement is the idea that online
15 of the E-commerce Directive,19 and the protection of fundamental rights.
platforms are unfairly appropriating part of the value generated by the use of copyright works.
Several meanings can be attached to the concept of “value.” Economic theory suggests that
, Sabam, the Belgian Association of Authors, Composers and Publishers, had
the value of copyright works is not and should not be entirely appropriated by rightholders.
The market value of a copyright work and its societal value are measured differently and should
“that Netlog be ordered immediately to cease unlawfully making available musical or au-
evolve over time. 10 Moreover, value creation also relates to innovation.11 “Value creation results
dio-visual works from SABAM’s repertoire and to pay a penalty of EUR 1000 for each day
from actions that entail the novel combination and exchange of resources, by which resources
of delay in complying with that order.”
are diverted from known applications to be deployed in new contexts.”
”12 The European Com-
mission therefore does not account for the value created by online platforms themselves and
How could Netlog, a social media platform, comply with the order in practice? By using content
more generally by transformative uses of copyright works.13 The chain of value creation to
recognition technology and implementing upload filters. Netlog then claimed
which online platforms contribute does not end with online platforms. By way of example,
“that the granting of such an injunction could result in the imposition of an order that it
introduce, for all its customers, in abstracto and as a preventative measure, at its own cost
7 As per Article 13 of the proposed Copyright Directive.
and for an unlimited period, a system for filtering most of the information which is stored
8 Such a view is shared by many academics and research centres across Europe. See e.g. S. Stalla-Bourdillon et al.
on its servers in order to identify on its servers electronic files containing musical, cin-
(40 academics) (2016), Open Letter to the European Commission – On the Importance of Preserving the Consistency
and Integrity of the EU Acquis Relating to Content Monitoring within the Information Society: https://ssrn.com/
However, the European Commission was of the view at that time that it needed to further “investigate the specific
S. Stalla-Bourdillon et al. (2016), A brief exegesis of the proposed Copyright Directive, fn 5; C.
needs of non-professionals that rely on protected works to create their own works.”
European Commission, Com-
Angelopoulos (2017), On Online Platforms and the Commission’s New Proposal for a Directive on Copyright in the
munication on Copyright in the Knowledge Economy, COM(2009) 532 final.
Digital Single Market (study commissioned by Julia Reda MEP), https://juliareda.eu/wp-content/uploads/2017/03/
14 SUSE (Germany), https://www.suse.com/contact/,
and Linagora (France), https://linagora.com/,
are two ex-
; G. F. Frosio (2017), Reforming In-
amples. The European Commission itself has recognised the importance of open source software for the European
termediary Liability in the Platform Economy: A European Digital Single Market Strategy, Northwestern University
economy and the necessity to focus “on policy actions that strengthen the OSS knowledge base and the exchange of
Law Review Online, 2017, Forthcoming, https://ssrn.com/abstract=2912272
best practices between private and public organizations.”
European Commission (2017), Final Report - The Economic
9 Proposed Copyright Directive, p. 3.
and Social Impact of Software and Services on Competitiveness and Innovation, (SMART 2015/0015), p. 12. Notably,
10 C. Handke, Y. Girard, A. Mattes (2015), Fördert das Urheberrecht Innovation? Eine empirische Untersuchung, Stu-
many independent projects of a small or medium size rely upon code-sharing platforms.
dien zum deutschen Innovationssystem Nr. 16-2015, p.12, https://diw-econ.de/wp-content/uploads/2015/02/Stu-
15 Youtube Help, How Content ID work, https://support.google.com/youtube/answer/2797370?hl=en-GB
uploaded to YouTube are scanned against a database of files that have been submitted to us by content owners.
11 A. Fayolles (2007), Entrepreneurship and New Value Creation - The Dynamic of the Entrepreneurial Process,
Copyright owners get to decide what happens when content in a video on YouTube matches a work they own. When
Cambridge University Press, p. 48.
this happens, the video gets a Content ID claim
.” Copyright owners can choose to block or monetise the video or
12 D. Di Gregorio (2013), Value Creation and Value Appropriation: An Integrative, Multi-Level Framework Jour-
track its viewership statistics.
nal of Applied Business and Economics vol. 15(1) 39, p. 40, http://www.na-businesspress.com/JABE/DiGregorioD_
16 One could also add to the list Audible Magic technology, https://www.audiblemagic.com/Conte nt-ID/,
referring to Schumpeter, J. A. (1928). The instability of capitalism. Economic Journal, Sept., 361-386.
book technology, https://rightsmanager.fb.com/
Reprinted in Schumpeter, J. A. 1988. Essays on entrepreneurs, innovations, business cycles, and the evolution of
17 How Google fights piracy, https://drive.google.com/file/d/0BwxyRPFduTN2cl91LXJ0YjlYSjA/view.
capitalism. New Brunswick: Transaction Publishers, 47-72.
18 Case C-360/10 Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV, 16
13 8 years ago, in 2009 the European Commission had observed that
February 2012, EU:C:2012:85.
“Web 2.0 applications, such as blogs, podcasts, wiki, file or video sharing enable users to easily produce and share
19 Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of
text, video and pictures. This has fuelled the development of new applications on the Internet and highlighted the is-
information society services, in particular electronic commerce, in the Internal Market (‘Directive on electronic com-
sue of user-created (amateur) content, where consumers are increasingly becoming creators of content, sometimes
merce’) OJ L 178, 17.7.2000, p. 1–16.
using copyright-protected material as a basis for their creation.”
, para. 21.
ematographic or audio-visual work in respect of which SABAM claims to hold rights, and
A careful analysis of these three arguments shows that it is the unfettered monitoring of all or
subsequently that it block the exchange of such files.”
most of the information stored by the online platform that raises fundamental rights concerns:
either because it amounts to the systematic processing of personal data, or because it is unable
The CJEU ruled that such an injunction is incompatible with EU law. The reasons for such a hold-
to distinguish between lawful and unlawful information or more simply because of its costs.
ing are plural but nonetheless related.
There is in particular a very intimate relationship between the finding of a monitoring obligation
The first one is a violation of an existing secondary legislation, i.e. the E-commerce Directive,
of a general nature and the finding of an engagement of Article 8. Certain amendments have
and more precisely its Article 15.
been tabled in the European Parliament arguing that only the reference files are being checked,
and thereby there is no processing of personal data. However, personal data must be processed
Article 15(1) of the E-commerce Directive provides that:
in order to allow the proposed appeals process to function. It is also argued that a search for
“Member States shall not impose a general obligation on providers, when providing the
specific reference files is not a general monitoring. This ignores the fact that it is the size of the
services covered by Articles 12, 13 and 14, to monitor the information which they transmit
targeted population that is crucial (i.e. whether the entire user base is in fact targeted by the
or store, nor a general obligation actively to seek facts or circumstances indicating illegal
monitoring or not) as well as the wide range of information searched for. Furthermore, the num-
ber of reference files will run into hundreds of thousands, if not millions. Assuming each search
for a matching with a reference file should be deemed monitoring “in a specific case”
The CJEU therefore states that issuing such an injunction would amount to imposing a monitor-
meaning of Recital 47 of the E-commerce Directive, which in itself is debatable as all service
ing obligation of a general nature:
users would be concerned as well as all their platform activities, Article 15 would certainly be
undermined by the systematic juxtaposition of hundreds of thousands of specific cases. Finally,
“The injunction imposed on the hosting service provider requiring it to install the contested
the argument based on cost should be related to the discussion on innovation and value cre-
filtering system would oblige it to actively monitor almost all the data relating to all of its
service users in order to prevent any future infringement of intellectual-property rights. It
follows that that injunction would require the hosting service provider to carry out general
In consequence, the E-commerce Directive and its Article 15 are not the only reason why Ar-
monitoring, something which is prohibited by Article 15(1) of Directive 2000/31.”
ticle 13 of the proposed copyright directive is problematic. Said otherwise, fundamental rights
concerns explain why mandatory upload filters are incompatible with Article 15. Article 15 of the
The CJEU continues its analysis by considering and ultimately attempting to balance different
E-commerce Directive thus finds its roots in the protection of fundamental rights, including the
fundamental rights. It finds that the rights to data protection, freedom of expression and to
rights to data protection and freedom of expression of Internet users.
conduct one’s business, respectively protected by Articles 8, 11 and 16 of the EU Charter, were
all engaged in this case.
It is worth reproducing the reasons for these findings:
Reforming copyright at the EU level
1. “The injunction requiring installation of the contested filtering system would involve the
What should the EU legislature do then? Once again, the decision of the CJUE Sabam/Netlog
identification, systematic analysis and processing of information connected with the
worth rereading and in particular the reasons for finding that Article 11 of the EU Charter is en-
profiles created on the social network by its users. The information connected with
gaged in the case at hand. The CJEU observes, more or less implicitly, that beyond the approxi-
those profiles is protected personal data because, in principle, it allows those users to
mation of upload filters the route to automation can only reasonably start with the harmonisa-
tion of copyright exceptions. To repeat the words of the CJEU, “it is not contested that the reply
to the question whether a transmission is lawful also depends on the application of statutory
2. “That injunction could potentially undermine freedom of information, since that sys-
exceptions to copyright which vary from one Member State to another.”
Going back to the big
tem might not distinguish adequately between unlawful content and lawful content,
sister of the proposed Copyright Directive, i.e. the infosoc Directive,27 the latter comprises 20
with the result that its introduction could lead to the blocking of lawful communica-
optional exceptions and thereby cannot be describe as an attempt to reduce divergences.28 The
tions. Indeed, it is not contested that the reply to the question whether a transmission is
three mandatory exceptions29 introduced in the proposed Copyright Directive will not change
lawful also depends on the application of statutory exceptions to copyright which vary
from one Member State to another. In addition, in some Member States certain works
For freedom of expression concerns to be (partially) alleviated, context assessment should
fall within the public domain or may be posted online free of charge by the authors
be made possible in order to determine if the act at stake is permitted or justified without the
rightholder’s consent. Because the technology itself is not able to assess context, processes
in the sense of a set of steps taken in order to reach a decision whether to restrict access to a
3. “In the main proceedings, the injunction requiring the installation of the contested fil-
particular content become crucial to meet fundamental rights requirements.
tering system involves monitoring all or most of the information stored by the hosting
service provider concerned, in the interests of those rightholders. Moreover, that moni-
toring has no limitation in time, is directed at all future infringements and is intended
to protect not only existing works, but also works that have not yet been created at
the time when the system is introduced. Accordingly, such an injunction would result in
a serious infringement of the freedom of the hosting service provider to conduct its
26 See p. 3.
27 Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of
certain aspects of copyright and related rights in the information society OJ L 167, 22/06/2001 p. 10 - 19.
28 Notably, the infosoc Directive had already been criticised for its lack of ambition. See e.g. Bernt Hugenholtz
, para. 23.
(2000), Why the Copyright Directive is unimportant, and possibly invalid, vol. 22(11) EIPR, p. 501-502, https://pure.
, para. 38.
uva.nl/ws/files/3086454/9021_opinion_EIPR.html (“If the Directive does not produce much legal certainty, it does
, para. 49.
even less in terms of approximation. This is painfully visible in the piece de resistance of the Directive, article 5 on
, para. 50.
, para. 45.
29 See Articles 3-5 of the proposed Copyright Directive.
Article 13 does not put in place a proper process for the use of content recognition technology
Such a paragraph should therefore be read as requiring an assessment of the applicability of copyright excep-
in order to reach a decision whether to restrict access to particular content. The only safeguard
tions before the decision to restrict access to a contentious material is taken.
found in Article 13 would become relevant once the decision to restrict access has been taken,
It is true that the expression content recognition technology does not disappear completely
i.e. the availability of complaints and redress mechanisms.30
from the text of the amended proposal and is maintained in the new version of Recital 39, which
Notice-and-action procedures are one example of processes, although there is a range of varia-
reads as follows:
tions and not all notice-and-action procedures are well balanced. However, the EU legislature
has up until now always postponed the task to harmonise through hard law or soft law such
“Collaboration between information society service providers storing and providing access
procedures, although such a possibility had been envisaged right from the beginning by the
to the public to large amounts of copyright protected works or other subject-matter up-
drafters of the E-commerce Directive.31
loaded by their users and rightholders is essential for the functioning of technologies, such
as content recognition technologies.
Notice-and-action procedures are all the more important since the right to freedom of expres-
sion is not the only fundamental right at stake. The right to data protection in the EU Charter
In such cases, rightholders should provide the necessary data to allow the services to identify their con-
and the right to the respect of one’s private life imply following CJEU case law that the sys-
tematic processing of all or most user information to prevent copyright infringement raise seri-
The amended version of Recital 39 still feeds on confusion. At least two interpretations are pos-
ous concerns. Yet notice-and-action procedures are based on the premise that the processing
sible: either Recital 39 still implies that content recognition technologies should be systemati-
undertaken by rightholders is only partial as per definition rightholders do not have access to
cally used by online platforms in an attempt to detect potentially infringing content or Recital
the entirety of user information. In addition, notice-and-action procedures make possible the
39 implies that content recognition technologies should be used after the reception of a noti-
coupling of a second stage consisting in an assessment of the context is which the copyright
fication to check whether the claim made in the notification is legitimate. Importantly, such a
work at stake is actually being borrowed from. This does not mean that notice-and-action pro-
check should not be seen as superfluous as notice-and-action procedures can be abused and
cedures cannot be partially automated,32 at least at the detection stage. As a result, the use of
have been abused in the past.34 As it should be clear from the foregoing, the second interpreta-
content recognition technology should not be equated to the implementation of upload filters.
tion should be preferred. With this said, whether online platforms shall be permitted, without
additional licenses, to use reference files to check the legitimacy of claims made in the context
Amending Article 13, Recitals 38 & 39
of notice-and-action procedures is not explicitly stated in the amendment.
In its draft report,33 rapporteur Therese Comodini Cachia proposes to amend Article 13 and
Recitals 38 and 39. The amended version of Article 13 does not refer to content recognition
technology any more. Because of the confusion widely spread between the use of content rec-
Making upload filters a requirement for certain online platforms is an ill-conceived policy at
ognition technology and the implementation of upload filters this disappearance could be seen
least for two reasons. First, mandatory upload filters are not meant to ensure a fair redistribu-
as an improvement of the text. Besides, it is now clarified that intermediary providers would not
tion of value between the different stakeholders involved in the value creation process. Second
be required to implement upload filters, although it is not entirely clear who would count as “in-
and more importantly, they raise serious fundamental rights concerns and appear incompatible
formation society service providers [that] are actively and directly involved in the making avail-
with the EU acquis broadly defined, including the EU Charter. Making the copyright framework
able of user uploaded content to the public and where this activity is not of a mere technical,
fit for purposes in the digital single market would require dedicating time and energy to the
automatic and passive nature.”
Nevertheless, the reference to “appropriate and proportionate
simplification of the exceptions landscape and streamline processes such as notice-and-action
measures to ensure the functioning of agreements concluded with rightholders for the use of
procedures to the benefit of European culture and society.
is maintained. Whether such a drafting is enough to make it clear to both national
legislatures and judges that mandatory upload filters should not become a requirement could
still be questioned.
With this said, the new paragraph 2a adds that:
“The measures referred to in paragraph 1 shall be implemented without prejudice to the
use of works made within an exception or limitation to copyright. To this end, Member
States shall ensure that users are allowed to communicate rapidly and in an effective man-
ner with the rightholders who have requested the measures referred to in paragraph 1 in
order to challenge the application of those measures.”
30 Article 13(2) of the proposed Copyright Directive provides that: “Member States shall ensure that the service pro-
viders referred to in paragraph 1 put in place complaints and redress mechanisms that are available to users in case
of disputes over the application of the measures referred to in paragraph 1.”
31 See Article 21(2) of the E-commerce Directive.
32 See e.g. P. Zhang, S. Stalla-Bourdillon and Lester Gilbert (2016), A content-linking-context model for “notice-
and-takedown” procedures In WebSci ‘16 Proceedings of the 8th ACM Conference on Web Science. ACM New York,
NY, USA, p. 161-165, https://eprints.soton.ac.uk/397678/
; P. Zhang, S. Stalla-Bourdillon and Lester Gilbert (2017), A
content-linking-context model for “notice-and-takedown” procedures, Journal of Web Science, Forthcoming.
33 Draft report on the proposal for a directive of the European Parliament and of the Council on copyright in the
Digital Single Market (COM(2016)0593 – C8 0383/2016 – 2016/0280(COD)), Committee on Legal Affairs, Rappor-
teur Therese Comodini Cachia, Rapporteur for the opinion Catherine Stihler 13 March 2017. Therese Comodini Cachia
has been replaced by Axel Voss. The vote on the report is scheduled for 10 October 2017. Three opinions have been
adopted respectively by IMCO, CULT and ITRE, http://www.europarl.europa.eu/oeil/popups/ficheprocedure.do?lan
34 See e.g. Jennifer M Urban, Joe Karaganis, and Brianna L. Schofield (2016), Notice and Takedown in Everyday
Practice. UC Berkeley Public Law Research Paper No. 2755628, http://ssrn.com/abstract=2755628.
Addressing the value gap on user-generated content plat-
forms from the perspective of weaker copyright holders
Dr Giuseppe Mazziotti - Trinity College Dublin
In a piece published on The Guardian in October 2013, the former leader of Talking Heads, David
Byrne, was very pessimistic about how the Internet would have impacted on the commercial
value of copyright.1 Byrne argued that streaming services such as Spotify and Pandora might
be good to discover new music but they bring no income to today’s artists across the creative
industries.2 Byrne’s voice has not been isolated in emphasizing a situation that is due not only to
the notoriously weak bargaining power of the average authors and performers vis-à-vis content
producers (e.g., record labels, film studios, etc) but also to the widely uncompensated dissemi-
nation of copyright works on user generated content platforms and social media.3
From the outset of the so-called ‘Web 2.0’, the preservation of the incentive/reward rationale
of copyright on online platforms that encourage and enable user creativity and participation
has been a highly debated and complex problem. It is still unclear how copyright works and
materials that users share and make available to others without the authorization of the respec-
tive rights-holders should be identified and removed. More than ten years after the first publi-
cation of a YouTube video,4 this question is still valid and open in Europe because of the legal
uncertainties that characterize the regime of liability of providers of such services in different
A copyright reform proposed by the European Commission in September 2016 seeks to bring
the aforementioned uncertainties to an end.5 Notwithstanding its title (i.e. ‘Copyright in the
Digital Single Market’) the priority of the draft directive is not the attainment of territorial unifi-
cation or integration of digital markets. At least when it comes to the business-related aspects
of the draft directive, the main goal is, rather, the achievement of a well-functioning market
place for creative works through a EU-wide, more effective and broader protection of copy-
right. This objective is pursued through several provisions that aim at bringing greater fairness
and transparency in the assignment and enforcement of copyright, also in the domain of user
generated content. As acknowledged in the impact assessment that accompanies the direc-
tive proposal, licensing practices in this sector have been very difficult to develop. One of the
main assumptions the directive proposal has drawn upon is that the advent of user-generated
platforms and social media in the last decade has triggered a significant erosion of the value
of copyright because of the central role these platforms have gained in making creative works
available to the public and given the widely unlicensed character of the copyright works they
provide access to.6
1 David Byrne, ‘The Internet will suck all creative content out of the world’, The Guardian, 11th of October 2013.
2 Byrne mentioned the example of the song of the summer 2013, ‘Get lucky’ by Daft Punk, which made the two
members of the band earn approximately 13,000 USD each, as a result of 104.760.000 Spotify streams this track
reached until the end of August 2013 (“What happens to the bands who don’t have International summer hits?”, he
3 IFPI & IMPALA (coordinators), Securing a sustainable future for the European music sector, Letter addressed to
Jean-Claude Juncker on 29th of June 2016 (signed by almost 1300 artists and songwriters from across Europe and
who regularly perform in Europea as of 18th of July 2016). In the letter the artists claimed that the future of music
was jeopardized by a substantial “value gap” caused by user upload services like Google’s YouTube, which are taking
value away from the music community and from its artists and songwriters.
4 The first video was uploaded on YouTube on the 23rd of April 2005 by Jawed Karim (with the title “Me at the
5 European Commission, Proposal for a directive of the European Parliament and of the Council, COM(2016)593
final, Brussels, 14.09.2016 (hereinafter ‘2016 directive proposal’ or ‘draft directive’).
6 The central role of such companies and of their services is also due to their very successful businesses: YouTube’s
value was estimated to be $70 billion and its revenues in 2015 were reported to be $9 billion; Pinterest has been
valued $12 billion in 2015; Soundcloud $700 million in 2014, etc. These figures are reported in European Commission,
Impact assessment on the modernisation of EU copyright rules, Commission Staff Working Document, SWD(2016)
301 final, Part 1/3, Brussels, 14.09.2016, p. 146 (hereinafter ‘Impact assessment’).
From a legal point of view, the debate has been widely monopolised by the question about
A limited liability of platforms has somehow been entailed by judgments of the Court of Justice
whether and how these kinds of platforms should be granted the special immunity from liabil-
of the European Union (CJEU). In particular, the Court found that the unauthorised embedding
ity Directive 2000/31 (e-Commerce Directive) created for providers of hosting services when
of copyright works on social media is lawful in so far as the linked or embedded content has
the web infrastructure was in its infancy.7 The provision of Article 13 of the 2016 draft directive
already been made already to the public with the consent of the copyright holder.14 The CJEU
seeks to bring clarity on this front, entailing that interactive services which play an active role in
found also that the installation of permanent filtering measures on social networks for purposes
giving access to user generated content (e.g., by optimising the presentation of the uploaded
of copyright enforcement would be excessively costly and burdensome for online platform and
works or promoting them) should be subject to copyright and be obliged to take measures to
would eventually run against their freedom to do business online.15
make unauthorised contents inaccessible.8
From a formal point of view, Article 13 would not directly modify the regime of liability exemp-
As we will see, this means that platforms such as YouTube, Facebook, Twitter, Instagram, Pin-
tion granted to providers of ‘hosting’ services. The e-Commerce Directive, at the end, would
terest, Vimeo and Soundcloud and many others would be expected to clear copyright for the
not be amended. The draft text, in this regard, clarifies that Article 13 would be applicable also
contents that pop up on their platforms and to implement technologies which ensure an accu-
to providers who qualify for the existing exemption, in a way that the two layers of regulation
rate identification of those items made available by their service subscribers without the per-
would operate simultaneously and in a complementary manner. However, it is evident that
mission of copyright holders.
the provision would avoid, with EU-wide effects, an excessively broad application of the ‘safe
harbour’ exemption by not allowing national courts to shield online platforms from liability in
case of online copyright infringement. What is controversial is the fact that the provision would
The ‘value gap’ provision
change the allocation of responsibilities between copyright holders and service providers, with
the consequence that the new law would veer away from the above-mentioned CJEU judg-
Article 13 of the draft directive aims at creating an obligation for providers of user-generated
ments that are deemed to guarantee a fair balance between the goals of online copyright en-
online content platforms to prevent the availability of unauthorized works on their services
forcement and freedom to do business online.16
by means of appropriate and proportionate measures, for instance by implementing effective
technologies. In the copyright reform debate and in the policy documents used for the prepa-
The central question, in my view, is whether such a change of policy is justified by the new func-
ration of the legislative proposal the provision has been constantly associated to a ‘value gap’
tion, purposes and features of online platforms and social networks, considering also that such
(from an expression used for the first time by the music sector) that would exist to the detri-
interactive environment did not exist when the current legislation was drafted and enacted. If
ment of the creative sector because of the widely uncompensated use of copyright works.9
such services are no longer passive actors but increasingly determine - at least with regard
to professionally produced content - how we have access to copyright works, why should we
The entities that would be obliged to make un-licensed works inaccessible are “… providers
treat them differently from how we treat professional content providers, such as media com-
that store and provide to the public access to large amounts of works or other subject mat-
panies? If such services, in addition to user creations, systematically give us access to contents
ter uploaded by their users …”. As clarified by the Commission, assessing the size (i.e. “large
we previously sought on radio and TV, why should we grant these platforms the privilege of
amounts”) of a user generated content platform would require an analysis of combined factors,
not remunerating what their businesses rely upon? Are the platforms media companies “by ac-
such as the number of users and visitors and the amount of content uploaded over a given pe-
riod of time.10 Appropriate and proportionate measures to be implemented would include tech-
nologies - such as Google’s Content ID, currently used across the YouTube platform - ensuring
If the new provision were interpreted, as it seems fair, as presupposing the obligation for on-
accurate identification of the works for which the platform devisers must have concluded li-
line platforms to enter into licensing agreements with copyright holders, the implementation
censing agreements with their respective copyright holders.11 As it has been critically observed,
of filtering mechanisms and similar technologies could be regarded as a practical consequence
the text of the Commission proposal could be better drafted in so far as it does not specify
of that obligation. At the end of the day, the obligation to clear the right of making content
whether Article 13 would impose a new filtering obligation only on platforms with existing li-
available to the public is already provided under Article 3 of Directive 2001/29, which aims to
censing agreements or – as it seems more correct, at least to me - on all platforms, regardless
ensure a high level of protection also in relation to interactive forms of making content avail-
of these agreements.12
able.17 Article 13 of the draft directive would just specify an existing obligation in the realm of
user-generated content by urging platform devisers to do what the biggest platforms have
In essence, the provision at issue aims at re-affirming the basic copyright principle according
already started doing, as the example of YouTube’s ‘Content ID’ shows. Unlike the hosting pro-
to which whoever reproduces and/or communicates to the public works protected by copy-
viders from late 1990s, today’s platform providers are in a position to ensure accuracy of con-
right must obtain prior
permission to do so from their respective copyright holders. Without
tent identification by relying on sector-specific content databases and to remove unauthorized
such permission – under copyright law - unauthorised uses such as those happening on social
contents at the best of their abilities. It goes without saying that such activity might be insuf-
media or online platforms certainly expose users to the consequences of copyright infringe-
ficient to prevent copyright infringement and the related technologies might be mistaken and/
ment. However, it still uncertain in the case law of the EU member states whether or not the
or imperfect in performing such tasks, especially with regard to certain types of work. However,
platform deviser would be (directly or indirectly) liable for infringements of their subscribers.13
because of the above-mentioned technological change, there is no reason in my view to leave
the burden of monitoring user-generated content just to copyright holders (i.e. through notice-
7 Directive 2000/31/EC of the European Parliament and of the Council on certain legal aspects of information so-
and-takedown mechanisms) and to not force platform devisers to co-operate with copyright
ciety services, in particolar electronic commerce, in the Internal Market, OJ L 178, 17.07.2000, pp. 1-16 (hereinafter
holders in order to verify and, if necessary, to filter the contents they commercially exploit. In
assessing the plausibility of such obligation one should carefully consider that online platforms
8 See the 2016 directive proposal, recital 38.
9 Helen Smith, (IMPALA), Véronique Desbrosses (GESAC), Frances Moore (IFPI), ‘Value gap is crucial for the music
are already tracing user access to digital content in order to run their advertising-based and
sector’, The Guardian
, 24th of July 2016.
user profiling businesses.
10 See Impact assessment, p. 146.
11 See YouTube, How Content ID
works, available at support.google.com.
12 European Research Centres (Amsterdam, Barcelona, Berlin, Cambridge, Glasgow, Munchen, Paris, Strasbourg, Til-
All these cases are mentioned in the Commission’s impact assessment, p. 143.
burg, Torino), EU Copyright Reform Proposals Unfit for the Digital Age
, Open letter to the Members of the European
14 See C-466/12, Svensson
v. Retriever Sverige AB
(2014) and C-348/13, Bestwater International GmbH
Parliament and of the Council of the European Union, 24th of February 2017, p. 6 (hereinafter ‘Open Letter’).
13 See the GEMA v YouTube
cases in Germany (Higher Regional Court Hamburg, July 2015; Higher Regional Court
15 See C-70/10, Scarlet Extended SA
(2011) and C-360/10, Sabam
Munich, January 2016), where the courts considered that, while YouTube presents itself as an alternative to Spotify
16 See the Open Letter of European Research Centres, p. 6.
and similar services, it does not carry out an act of communiction to the public (which is carried out by the upload-
17 Directive 2001/29/EC of the European Parliament and of the Council on the harmonisation of certain aspects of
ers). A similar interpretation was given by the Court of Paris (January 2015) in the case Kare Productions v YouTube
copyright in the information society, OJ L 167, 22.06.2001, pp. 10-19.
The European Commission’s reasoning
been necessary if the online platform devisers had effectively enforced their own terms of ser-
vice with regard the upload of unauthorized materials. No copyright infringement would have
In the impact assessment that accompanies the directive proposal, the European Commission
massively materialised in the era of Web 2.0 if the online platforms, from the outset, had paid
pointed out that a legislative intervention on user-generated content and social networks is
attention (both legally and technologically) to the contents entire user communities were shar-
needed for copyright holders to re-gain control over the modes and conditions of online exploi-
ing on their networks. In this regard, what the value gap provision is seeking to achieve now is
tation of their works. The Commission emphasized the necessity to continue to support and
to make legally
explicit what has already been expressed and required contractually
, but not
remunerate digital content creation at a time when, with the rise of interactive online environ-
properly enforced, to the detriment of the value of unauthorised creative works.
ments, copyright holders have proven to be unable to rely on an undisputed legal obligation
for platform and service providers to obtain permission for what their users/subscribers make
available online and what the platforms gain through customized commercials.18
A lose-lose situation for copyright holders
A situation of uncertainty, as regards such obligation, has arisen with regard to providers of
It is easy to understand why user-generated content platforms and social networks give rise to
social media and social network services because of their frequent inclusion, in the case law
a ‘lose-lose’ situation for copyright holders if one considers the two aspects below:
developed in various European jurisdictions, into the categories of hosting providers who ben-
efit from the liability exemption under Article 14 e-Commerce Directive. The Commission ac-
1. Copyright holders have not been able to rely on a proper enforcement of their rights when
knowledged that this situation of uncertainty has significantly weakened the bargaining power
someone else makes available their works without permission within an online platform. If an
of copyright holders and decreased the value for copyright content, especially with regard to
author or a copyright holder has no resources to monitor content generation on platforms
TV broadcasts.19 On the one hand, online platform providers have offered to rights-holders –
and to send notices to take content down, her copyright remains ineffective unless the
according to the impact assessment – mostly ‘monetization agreements’, which are regarded
platform deviser acts spontaneously and removes the unauthorised work. It must be borne
as being concluded on a voluntary basis, not as a result of an obligation of online platforms to
in mind that notice-and-takedown procedures have been mostly used by music and film
clear copyright. On the other hand, these deals do not reflect the value (and the price) of the
majors and by their respective anti-piracy bodies, for which these industries have invest-
licensing agreements that copyright holders enter into with on-demand content suppliers such
ed significant amounts of money across Europe. To the contrary, the notice-and-takedown
as Spotify, Deezer and Netflix and with TV broadcasters, who are therefore placed in a disad-
mechanism has never worked properly for individual creators such as photographers, writ-
vantaged position vis-à-vis the user generated content platforms.20
ers, composers and film or video makers and small producers because of the lack of time
and money to be dedicated to online enforcement procedures.
To motivate its decision to intervene, the Commission stressed also that the activities of provid-
ers of today’s user generated content are unlikely to fall within the scope of the liability exemp-
2. The standard terms and conditions which are accepted by users of social networks and user-
tion created under Art. 14 of the e-Commerce Directive. The main reason for that is that the
generated content services require subscribers to give platforms such as YouTube, Face-
exemption, as explained by the Court of Justice of the European Union in a landmark decision,21
book and Instagram a global, free and perpetual licence for the platforms to use and exploit
shall be reserved to merely technical and automatic activities, and not to services whose func-
all contents (e.g. writings, photos, music, multi-media and audiovisual works) authored by
tionalities include content categorization, recommendations, playlists or the ability to share
users. This means that whoever wished to make available his or her works in order to take
contents.22 In short, these functionalities make online platforms clearly distinct from the passive
advantage of the remarkable exposure opportunities provided by large online platforms
and unaware hosting providers the drafters of the e-Commerce Directive had in mind when
would instantaneously lose – especially in the absence of bargaining power, as in the case
shaping the exemption.
of individual creators and small-size content producers - all remuneration opportunities by
the condition of gratuity imposed under standard terms and conditions. Moreover, the “ex-
posure” effects the online platforms have strongly advocated are primarily beneficial to
Aren’t users already obliged to not publish unauthorized works?
performing artists (i.e. musicians, actors) who could view uncompensated viewings on user
upload platforms as a way to boost their live performance businesses. However, this is not
The rise to prominence of video-sharing platforms such as YouTube, Daily Motion and Vimeo,
a mechanism that fits the business of non-performing authors of works such as films, videos
social networks like Facebook and Twitter and other interactive services or dedicated plat-
and other multi-media works for which the making available on a user-generated content
forms for photos (e.g. Instagram, Pinterest) and sound recordings (e.g. Soundcloud) has signifi-
platform inevitably compromises the exploitation and remuneration opportunities for each
cantly expanded the opportunities for Internet users to access copyright works and to become
of those works.
authors themselves. As of October 2015, YouTube had 1,3 billion users (i.e. one third of all Inter-
net users) who upload 400 hours of video content every minute; Daily Motion has 300 million
users watching 3,5 billion views every month; Vimeo has a monthly audience of approximately
Addressing the value gap from the perspective of weaker copyright holders
170 million users and 35 million registered users; Soundcloud’s user community has grown ex-
ponentially, going from 11 million users in 2011 to 150 million in 2015 and 250 million in 2016.23
If one considers the relevance of copyright and of its effective enforcement for the purpose to
preserve and stimulate diversity of content creation, Article 13 can be easily placed in relation to
From a legal point of view, access to such platforms is made conditional upon the acceptance
other measures of the draft directive that seek to help copyright holders gain a better position
by each single user/subscriber of terms and conditions that are relevant from a copyright-
to negotiate and licence their online rights and to gain adequate remuneration. From this angle,
related perspective. Standard terms and conditions that apply to online content platforms
the ‘value gap’ provision can be viewed as a complementary tool to achieve a broader policy
contractually oblige subscribers not to share and publish contents created by third parties and
objective, which is that of ensuring a fair share of income to copyright holders who – under the
which they cannot lawfully dispose of.24 This means that no ‘value gap’ provision would have
current legal framework - have been unable to gain adequate revenues from online uses of their
18 Commission’s impact assessment, p. 139.
For the first time in the history of European copyright policy, the 2016 draft directive targets
19 Impact assessment, p. 141.
the contractual relationships between individual creators and their assignees with the intent to
21 See C-324/09, L’Oreal and Others
v. eBay International AG and Others
introduce a common approach of transparency requirements across the EU and to strengthen
22 Commission’s impact assessment, p. 138.
the bargaining power of original copyright holders.25 To this end, Article 14 of the proposal
24 See, for instance, YouTube’s (http://youtube.com/terms
) and Facebook’s (http://facebook.com/terms
) Terms of
25 Commission’s impact assessment, pp. 173 ss.
obliges Member States to ensure that authors and performers be given, in accordance with the
and unreliable.29 Someone has also blamed the Commission for having inserted this provision in
specificity of each sector of the creative industries, a right to timely and adequate information
the directive having just one company and business in mind, i.e. Google’s.30 A brief reflection on
on the modes of exploitation of their works and the related revenues.26 Moreover, Article 15
the aforementioned critical remarks seems to be useful:
gives authors and performers the possibility of seeking contractual adjustments whenever their
1. Innovation and user participation:
in an environment where a high level protection of copy-
originally agreed remuneration proves to be disproportionately low in comparison to the earn-
right is mandated under all copyright directives and regarded as an intrinsic guarantee for
ings and benefits derived from the online exploitation of their works.
the creation of professional content, interpreting the duty to remunerate authors and pro-
The above-mentioned provisions show that there is a clear attempt to enable copyright holders
ducers of the content a business relies upon is a misconception of what intellectual property
to take advantage of the expected increase of revenues produced by the implementation of
is about. It is true that the platforms that have started their activities and developed in the
Article 13. This is even more important for copyright holders with a weaker bargaining power
last decade have taken advantage of an unclear legal framework and of a loophole in widely
in so far as their newly created rights to obtain sector-specific and timely information and an
using copyright works for free. However, this has come with a price, which is the erosion of
adequate remuneration - to be sought also through contractual adjustments - were made ef-
the commercial value of creative works and the frustration of online remuneration opportu-
fectively enforceable and non-waivable on EU-wide grounds.27
nities for professional content creators. It seems obvious to me that the value of professional
It would be much easier for individual copyright holders to licence and price their works, also
content should be protected as a crucial element of the ‘Digital Single Market’ strategy.
through their collecting societies, if they knew how profitable their use has been in interactive
2. Accuracy of content identification:
in certain sectors (music, for instance) content identifica-
environments. This would be true not only with regard to user generated content platforms and
tion technologies are more developed than in others, depending also on the availability of
social networks but also in the realm of on-demand services. It is therefore not surprising that,
databases copyright holders place at the disposal of online platforms to facilitate fair and
among the hundreds of amendments which have been tabled in the European Parliament, a
proportionate filtering mechanisms.31
The fact that in other sectors, such as photography,
few of them seeking to pursue a fair remuneration strategy in a more straightforward way (i.e.
such databases and technologies are not equally available is, in my view, a further reason to
through the codification of a right to remuneration to be paid directly to authors and perform-
introduce the provision of Article 13, which would give platform devisers and rights holders
ers for the making available of their works by on-demand content providers) were eventually
an incentive to co-operate and to improve filtering and content identification technologies.
incorporated in the opinions sent by the Culture and Industry Committees to the Legal Affairs
3. Re-allocation of responsibilities:
as it has been pointed out above, the value gap provision
Committee on the 11th of July 2017.28
entails a different regulatory treatment for a kind of intermediation in digital content distri-
If the final version of the directive established a clearer and stronger link between Article 13
bution which is characterised by the active role of the platform and considers the opportuni-
and the rights to information and to fair remuneration of authors and performers under Ar-
ties of content identification and nuanced filtering mechanisms which has become available
ticles 14 and 15, the increased output coming from user generated content could be viewed
recently. The e-Commerce Directive and notice-and-takedown procedures would still mat-
as an equivalent of the right to equitable remuneration that the aforementioned amendments
ter and remain applicable in their own sphere of application.
seek to introduce in the domain of on-demand content deliveries. Even though the structure
4. Freedom to do business online
: the technological measures required under the value gap
of the two rights would be substantively different, both proposals aim at creating an obliga-
provision would have to be fair and proportionate and should not cause ‘over-blocking’ or
tion to remunerate copyright holders that would be particularly important for individuals and
restriction of free and legally unprotected materials made available by the platform users.
small companies having no or little bargaining power vis-à-vis the online platforms and the
on-demand content suppliers. As far as online platforms are concerned, as we have seen, the
5. Addressees of the provision:
it is paradoxical that the initiative of the Commission might
draft directive seeks to place authors and performers in a position to better negotiate and li-
have been taken as a measure to be enacted just against the provider of one user generated
cence their rights, also through their respective collecting societies. According to the proposed
platform, i.e. YouTube, and not also as a tool to foster copyright clearance activities on mul-
directive, contractual remedies will have to be made available each time the originally agreed
tiple platforms. YouTube’s deviser, i.e. Google, was actually a pioneer in the development
remuneration of authors and performers proves to be disproportionately low in comparison to
of content identification technologies and it is probably the platform that is best suited to
the (transparent) revenues generated by the exploitation of their works. As regards on-demand
achieve a well-functioning marketplace for copyright works on its platform. Due to such
services, instead, the amendments proposed by the Culture and Industry Committees aim at
advancement of YouTube on content identification, it is evident that the enactment of the
codifying a EU-wide right to remuneration to be enforced against the providers of such services
value gap provision would be more costly and demanding for other companies and plat-
and to be administered by collecting societies of authors and performers, in both the music and
forms where licensing agreements and copyright enforcement measures have been poor or
non-existing. The problem of the provision is actually the opposite, if one considers that the
obligation to filter copyright works might end up being applicable to non-commercial user-
generated platforms such as Wikipedia. In this respect, an amendment of Article 13 aimed at
excluding non-for-profit platforms from the scope of application of the new provision could
be a suitable solution.
The proposal to enact the provision of Article 13 has been widely criticized in the current debate
in so far as it would stifle innovation and user participation in online environments and would
oblige platforms to implement technologies in sectors where content identification is flawed
After having briefly explained the rationale and policy objectives of Article 13 of the proposal
for a directive on ‘Copyright in the Digital Single Market’ (the so-called ‘value gap’ provision),
this paper has provided a brief reflection on the nature of the obligation to filter and make un-
26 The Commission pointed out that the transparency obligations which are currently in force under national laws
authorized copyright works inaccessible on user-generated content platforms. In particular, the
are either too generic or applicable just to certain sectors: see Impact assessment, p. 176.
27 The Commission believes that this set of new measures would provide creators with practical tools to negotiate
and obtain appropriate remuneration for online uses of their works: see Impact assessment, pp. 190-191.
28 See Society of Audiovisual Authors (SAA), European Copyright: Parliament Committees vote for an unwaivable
29 Open Letter, p. 1.
right to fair remuneration for audiovisual authors
, 11th of July 2017, available at http://saa-authors.eu
, and AEPO-
30 See Agustin Reyna, ‘A tale of two industries: the “value gap” dilemma in music distribution’, Internet Policy Re-
ARTIS, Statement of Fair Internet Coalition in reaction to ITRE and CULT votes on 11 July 2017
, which welcomed the
, 8th of August 2017.
introduction of such an unwaivable right. The opinions of the two committees will be examined by the leading com-
31 For instance, a content identification technology provider such as Audible Magic has indicated positive identifica-
mittee on the file (Legal Affairs) in September 2017.
tion rates that exceed 99%: see http://audiblemagic.com/why-audible-magic/.
paper has taken the current situation of individual creators and small-size independent content
Form and Substance in the Value Gap Proposal1
producers into specific consideration, pointing out that the online distribution of their works
triggers a ‘lose-lose’ situation. On the one hand, the excessively burdensome and costly nature
of notice-and-takedown mechanisms do not place these right-holders in a position to effec-
In September 2016, the European Commission published a copyright reform package, in-
tively enforce their rights when unauthorised users makes them available on online platforms.
cluding a new Directive on copyright in the Digital Single Market. One of the Directive’s
On the other hand, such rights-holders have no contractual freedom under standard terms
most controversial aspects is the so-called “value gap proposal” provided in Article 13 and
and conditions of use of these services to licence and effectively monetize their own creations
when they decide to join online platforms and social networks and to create their own, official
accounts. The paper suggests that the provision of Article 13 could have a much stronger jus-
This proposal suffers from a number of fundamental problems, of both a formal and sub-
tification if its goal to fill a gap in the value chain of online content were more closely linked
stantive nature. From the formal point of view, the proposal (i) includes normative provi-
to the codification of a right to fair remuneration to be achieved through effective rights and
sions in the recitals, (ii) lacks basic clarity, and (iii) uses trivially vague language. On the
remedies (i.e. a right to information about the levels of remuneration and the modes of online
substantive side, if passed into law the proposal will (i) thwart digital innovation and (ii)
exploitation; a right to contractual redress in case of disproportionately low remuneration) that
disproportionately restrict the fundamental rights of Internet users and platform opera-
the 2016 draft directive embodies under Article 14 and 15.
Given the seriousness of these flaws, the EU institutions should consider deleting or, at
least, significantly rewriting the proposal.
In September 2016, the European Commission published a copyright reform package3. The
most controversial instrument in this package4 is the Directive on copyright in the Digital Single
Market5 (draft Directive). The main reason behind the controversy, along with the proposed
right for press publishers6, lies in the so-called “value gap proposal” provided in Article 13 and
Recitals 37 to 39.
Over the last few years, rightholders and their representatives have been floating the idea that
there is a value gap in the online content marketplace that is in need of closing. In their lobbying
efforts, the value gap7 has come to replace piracy as the main digital threat to the survival of the
creative industries8. The idea is that rightholders face difficulties when seeking to license and
be remunerated for the online distribution of their works9. With the evolution of digital tech-
nologies, platforms of user-uploaded content (think of YouTube, Dailymotion and Vimeo) have
become important vehicles for such distribution. According to rightholders, these platforms
inappropriately invoke the “hosting safe harbour” laid down in Article 14 of the E-Commerce
Directive in order to argue that they are under no obligation to conclude licensing agreements.
Rightholders claim that, as a result, they are not always able to obtain a fair remuneration from
platforms of user-uploaded content. The unfairness, they add, is made evident by the differ-
ence between the remuneration paid by these (typically ad-funded) platforms and that paid by
subscription services, such as Spotify Premium and Deezer10.
1 The title of this contribution borrows from the title of one of the most influential American law review articles of
the late twentieth century: Kennedy (1976).
2 Lecturer in Copyright Law, Universidade Católica Portuguesa – Faculdade de Direito (Lisbon); LL.M., Harvard Law
School (Cambridge, MA).
3 With the fundamental purpose of “modernising” EU copyright rules for the digital age, the package comprises
one Regulation on copyright and related rights for online transmissions and retransmissions of television and radio
programmes and one Directive on copyright in the Digital Single Market, as well as two other instruments dedicated
to implementing the Marrakesh Treaty into EU law.
4 The number of amendments submitted by MEPs – almost 1.000 – may serve as an illustration of the degree of controversy. See http://en.euractiv.eu/wp-content/uploads/sites/2/2017/05/JURI-copyright-amendments.pdf.
5 Proposal for a Directive of the European Parliament and of the Council on copyright in the Digital Single Market,
COM(2016) 593 final.
6 Criticising the introduction of a new right for press publishers, see, e.g.
, Hugenholtz (2016); Kretschmer et al.
(2016); Peukert (2016); Ramalho (2017); and Geiger et al. (2017).
7 The expression “transfer of value” is sometimes used instead of “value gap”. See, e.g.
, Lucas-Schloetter (2017).
8 See, e.g., the petition at http://www.makeinternetfair.eu.
IFPI (2015), p. 23.
Grounded on this rationale, Article 13 and Recitals 37 to 39 of the draft Directive attempt to ad-
facilities and violate the right of communication to the public, leaving no room for further con-
dress this gap, by reinforcing the position of rightholders to negotiate and be remunerated for
siderations related to the nature of the platform’s intervention or to its profit-making intention
the online use of their works by platforms of user-uploaded content11.
– considerations that the CJEU has found essential in recent case law14.
Article 13(1), the proposal’s centrepiece, reads as follows:
On the other hand, when the draft Directive was published there was no clear indication in the
Information society service providers that store and provide to the public access to large
that the concept of communication to the public within the meaning of Article
amounts of works or other subject-matter uploaded by their users shall, in cooperation with
3(1) InfoSoc covered the activities of platforms of user-uploaded content. Arguably, some such
rightholders, take measures to ensure the functioning of agreements concluded with right-
platforms would nonetheless be found liable on grounds that they exerted an “indispensable
holders for the use of their works or other subject-matter or to prevent the availability on their
intervention” in providing access to protected works15. This was made clearer in the recent Pi-
services of works or other subject-matter identified by rightholders through the cooperation
judgment, in which the CJEU held that an online search platform that indexes, catego-
with the service providers. Those measures, such as the use of effective content recognition
rizes, deletes and filters content may actually engage in acts of communication to the public16.
technologies, shall be appropriate and proportionate. The service providers shall provide right-
But the nature of the intervention of BitTorrent websites like The Pirate Bay differs from that
holders with adequate information on the functioning and the deployment of the measures, as
of other platforms that store and provide public access to user-uploaded content. This CJEU
well as, when relevant, adequate reporting on the recognition and use of the works and other
“precedent” could well be found inapplicable to platforms that do not show as high a degree of
editorial intervention as The Pirate Bay17.
Since the Commission released the draft Directive, numerous independent academics have
The Commission therefore (mis)uses Recital 38 of the draft Directive to reshape the concept of
raised their voices against the value gap proposal
communication to the public, extending its coverage to new situations. As is common knowl-
12. With the present contribution, I merely re-
inforce the chorus of critics, by discussing those that are, in my view, the major problems with
edge among jurists, in general, and among those interested in EU law matters, in particular, re-
citals are (supposed to be) interpretative tools. According to the Interinstitutional Agreement
of 22 December 1998 on common guidelines for the quality of drafting of Community legisla-
These problems are of a twofold nature: formal and substantive. Formal problems and substan-
tion, “[t]he purpose of the recitals is to set out concise reasons for the chief provisions of the
tive problems are naturally intertwined, in that poor drafting choices often affect the provision’s
enacting terms, without reproducing or paraphrasing them. They shall not contain normative
substance. For clarity of exposition, nonetheless, I will treat these problems separately. The
or political exhortations”18. The CJEU has also acknowledged that recitals should not
problems that arise from the way in which the Commission chose to formulate
perform a normative a role, holding that “the preamble to a Community act has no binding legal
even where these choices have substantive repercussions, are treated under the section “formal
force and cannot be relied on as a ground for derogating from the actual provisions of the act
problems” (1.). On the other hand, the problematic nature of some of the options made by the
Commission is purely material and independent from the exact formula employed in the text of
the Directive. I address these shortcomings under the section “substantive problems” (2.).
In agreeing that recitals should not assume the role of their act’s operative part, EU institutions
show a palpable concern with legal certainty and with the protection of the expectations of
legal subjects. In the draft Directive, the Commission grossly neglects these values, by includ-
1. Formal problems
ing a crucial normative development of the copyright acquis
in Recital 3820. Assuming such a
development is to be adopted at all, it should be included in the operative part of the Directive
1.1. The proposal includes normative provisions in the recitals
and subject to the corresponding scrutiny.
The departure point of the proposal seems to lie in Recital 38, which starts by stating that online
1.2. The proposal lacks basic clarity
platforms, in storing and providing public access to protected content uploaded by their users,
Legal norms, if they are to give their subjects any guidance, must be clear. “The desideratum
perform an act of communication to the public. Abruptly, though at the same time stealthily, a
of clarity”, in the words of a celebrated legal theorist, “represents one of the most essential in-
significant change to the copyright acquis
is proposed: if the text of Recital 38 is approved as
gredients of legality”21. The value gap proposal fails to achieve that desideratum. In fact, Article
it stands, all
platforms of user-uploaded content, in providing their services, will be prima facie
13(1), read together with Recital 38, is a remarkably confusing provision22.
liable for communicating works to the public.
As seen, Recital 38 determines that online platforms that store and provide public access to
It is important to note that Recital 38 is not merely codifying a CJEU-developed construction13.
protected content uploaded by their users perform acts of communication to the public. These
On the one hand, throughout a long line of case law, the CJEU has shaped a complex concept
platforms are thus obliged to conclude licensing agreements with rightholders, unless
of communication to the public, composed of many interdependent criteria. None of these
eligible for the hosting safe harbour provided in Article 14 E-Commerce. How a platform’s li-
criteria, nor the way in which they interact with each other, are reflected in the value gap pro-
ability for communicating works to the public relates to the protection conferred by the safe
posal. Instead, Recital 38 simply states that platforms go beyond the mere provision of physical
harbour is not made entirely clear. Is the hosting safe harbour supposed to work as a defence
CJEU, GS Media
, C-160/15, paras. 47-55, and CJEU, Filmspeler
, C-527/15, paras. 41-53.
Rosati (2016), p. 20.
CJEU, The Pirate Bay
, C-610/15, in particular para. 38. See also
Rosati (2017), p. 15, noting that this recent
Communication from the Commission to the European Parliament, the Council, the European Economic and
ment brought CJEU case law closer to the Commission’s legislative initiative.
Social Committee and the Committee of the Regions, ‘Promoting a fair, efficient and competitive European copy-
Angelopoulos (2017), p. 32.
right-based economy in the Digital Single Market’, COM(2016) 592 final, p. 8.
18 Interinstitutional Agreement of 22 December 1998 on common guidelines for the quality of drafting of Community
Stalla-Bourdillon et al. (2016a); Stalla-Bourdillon et al. (2016b); Angelopoulos (2016); Angelopoulos (2017);
legislation, para. 10 (emphasis added). Similarly, see
Interinstitutional Style Guide, http://publications.europa.eu/
European Copyright Society (2017); Max Planck Institute for Innovation and Competition (2017); and CREATe (2017).
code/en/en-120200.htm, stating that “[r]ecitals set out the reasons for the contents of the enacting terms (i.e. the
Scholars dispute the very existence of a “value gap”. See, e.g
., Frosio (2017), p. 7 (arguing that the “value gap”
articles) of an act”.
rhetoric is “fabricated” by rightholders and “scarcely concerned with empirical evidence”), and CREATe (2017), p. 6
19 CJEU, Nilsson
, C-162/97, para. 54.
(claiming that “[t]he idea that the creation of value should lead automatically to transfer or compensation payments
20 In the words of Angelopoulos (2017), p. 31, “[f]or a nonchalant statement hidden in a recital, this represents a
has no scientific basis”).
dramatic development of EU copyright law”.
13 Such a codification of judge-made law would not be unprecedented. For instance, Article 4(2) of the InfoSoc
21 Fuller (1964), p. 63.
Directive codified the rule of exhaustion of the distribution right developed by the CJEU in Deutsche Grammophon
Angelopoulos (2016) and European Copyright Society (2017), p. 7, deeming the provision’s language “am-
biguous”; and CREATe (2017), stating that the proposal is “poorly drafted”.
against primary liability, in the sense that if the platform acts neutrally23 its liability for infringing
capacity to vote, legislators set an age of majority, instead of stipulating that “mature citizens”
the right of communication will be negated? Or is the platform’s non-neutrality (i.e.
, its active
are entitled to vote26. And if legislators want to tax rich people more heavily, they usually do so
role) a requirement for it to be considered as performing an act of communication? Who bears
by reference to a numerical level of income, instead of imposing a higher rate on “rich people”27.
the burden of showing what?
Sometimes, however, vagueness in the law is useful or simply unavoidable. The most notable
In any case, proceeds the recital, regardless
of whether platforms are protected by the safe
examples of vagueness in the law are cases of extravagant vagueness28. Every jurist is famil-
harbour, they need to take measures to guarantee the protection of content, so as to ensure
iar with examples of legal norms deploying this type of language, such as norms exempting
the functioning of licensing agreements… agreements which, as stated in the very same recital,
use” of protected works from liability or norms requiring adherence to a standard of
protected platforms do not need to conclude. Imposing on platforms that are immunised by the
care”. In certain circumstances, the situations that ought to be covered by a norm
hosting safe harbour an obligation to ensure the functioning of licensing agreements that they
are so diverse that vague language allowing for a multi-dimensional evaluation is needed. One
need not have concluded is, at best, puzzling. For the sake of analysis, however, let us consider
scholar offers “child neglect
as an example of a situation where a myriad of factors need to be
the case of a platform that provides its service non-neutrally, being thus ineligible for the safe
taken into account: “[y]ou just cannot stipulate that, say, leaving a child unattended for n
harbour, and that therefore undoubtedly needs to license the content it hosts (at least accord-
would constitute neglect”29.
ing to Recital 38).
In defining its subjective scope of application, Article 13(1) uses a vague adjective. The provision
In that case, Article 13(1) kicks in, imposing two alternative obligations upon the platform, in
applies to information society service providers that store and provide to the public access to
order to try and close the value gap: the platform should (a) take measures to ensure the func-
amounts” of content uploaded by their users. “Large”, like “rich” or “mature”, is a trivially
tioning of agreements concluded with rightholders for the use of their content; or
(b) take mea-
vague word – the type of vagueness that the law normally tries to avoid. In most cases, instead
sures to prevent the availability on their services of content identified by rightholders through
of resorting to this sort of language, the law defines a more or less precise threshold for its ap-
the cooperation with the service providers.
plication. The exercise of defining such a threshold is, of course, fairly arbitrary; but there are
The first obligation – when interpreted in light of Recital 38, which uses similar language in
very good reasons for doing it, namely legal certainty and efficiency.
its third paragraph (“ensure the functioning of any licensing agreement”) – translates into an
While in some cases the flexibility provided by vague language is needed, the situation regu-
obligation to take appropriate and proportionate measures to ensure the protection of con-
lated by Article 13 is far from being one such case. If online platforms are to comply with an
tent, such as implementing “effective technologies”. These technologies, judging by the second
obligation to implement certain exacting measures, they need a high degree of guidance. They
sentence of Article 13(1), Article 13(3) and Recital 39, can be no other than content recognition
need to know, at the very least, if they are subject to that obligation or not. It is beyond doubt
that YouTube and Dailymotion are platforms hosting “large amounts” of user-uploaded con-
Alternatively, platforms should take measures to prevent the availability on their services of
tent. But what should be said about the Portuguese platform Sapo Vídeos or the German tape.
content identified by rightholders. What are the precise measures that platforms should take?
tv? Do these platforms host large or non-large amounts of content? Where and how should the
The suggestion that Article 13(1) makes, yet again, is that platforms use “effective content rec-
line be drawn?
ognition technologies”. The question then becomes: How, in practical terms, does preventing
infringement (second obligation) differ from ensuring the protection of content (first obliga-
2. Substantive problems
tion)? Are they truly alternative – and, by necessity, different
– obligations? A combined reading
of Recital 38 and Article 13(1) indicates that the two (supposedly alternative) obligations laid
2.1. The proposal thwarts digital innovation
down in the latter are, in reality, one and the same obligation – and a rather worrying one24: that
online platforms implement content recognition technologies. But it may well be that the Com-
By now, you hopefully agree that the value gap proposal is not an example of good legal draft-
mission intended to give online platforms a true choice. What that choice is, though, remains
ing. Still, you may be tempted to downplay the criticism: after all, form is not substance and
substance trumps form. On the substantive front, however, the value gap proposal does not
In sum, as I hope to have successfully showed, several parts of Article 13(1) and Recital 38 lend
fare any better.
themselves to importantly diverging interpretations. This lack of clarity is possibly the product
As seen, in what regards the measures for copyright protection that should be adopted by plat-
of a difficult, compromise-ridden drafting process. Understandable as that is, it is safe to antici-
forms hosting large amounts of user-uploaded content, the only suggestion given by Article
pate that the proposed formulation will result in different transpositions by Member States, thus
13(1) and the cited recitals is the implementation of content recognition technologies.
fostering disharmony and legal uncertainty.
This suggestion, if transposed by Member States as a mandatory requirement, has the potential
1.3. The proposal uses trivially vague language
to seriously threaten innovation in the digital economy. Requiring online platforms to use such
technologies entails erecting a market entry barrier that is very costly to overcome. Google, for
Vague words are words that have borderline cases, i.e.
cases in which “one just does not know
example, reported that, by 2016, it had invested more than $60 million on its ContentID sys-
whether to apply the expression or withhold it, and one’s not knowing is not due to ignorance
tem30. An obligation to filter user uploads would discourage investment in the development of
of the facts”25. Typical examples of vague words are gradable adjectives like “bald”, “rich” and
this type of platforms, with indirect adverse effects on user creativity.
“mature”. We all know people that are clearly bald and people that are clearly not bald, but we
The fact that the requirement may be imposed only upon hosts of “large amounts” of content
also know people that are borderline bald (I would count myself as one such person). Legisla-
does not eliminate the problem. At a certain point in their growth (a point that Article 13 leaves
tors tend to avoid employing these trivially vague terms. For instance, in establishing the legal
indeterminate), smaller platforms will be forced to invest in technology the development and
Endicott (2011), p. 17.
23 The requirement to act in a neutral manner was developed by the CJEU as a threshold condition for accessing
Marmor (2014), p. 87.
the defence provided in Article 14 E-Commerce. See
CJEU, Google France
, C-236/08, para. 114, and
CJEU, L’Oréal v.
28 The term “extravagant” associated with these instances of vagueness is attributable to Timothy Endicott. See
, C-324/09, para. 113.
Endicott (2011), p. 17.
24 See infra
2.1. and 2.2.
29 Marmor (2013), p. 5.
25 Grice (1989), p. 177.
Google (2016), p. 6.
maintenance of which is said to be “unattainably expensive”31. The requirement that online plat-
dom of expression and information, and (iii) the online platform operators’ freedom to conduct
forms install such an expensive technology for copyright enforcement purposes would always
their business, and, on the other hand, the intellectual property rights of creators, protected by
amount to an intolerable constraint upon their operators’ right to freely pursue an economic
Article 17(2) of the Charter. If enacted without the necessary amendments, Article 13 may be
activity32. Even if the operators of smaller platforms manage to license some reasonably effec-
struck down by the CJEU on grounds of violations of the foregoing rights43.
tive technology, instead of developing their own, this cost will hinder their capacity to compete
with the larger incumbents33. As noted by the European Copyright Society, “[t]he unforeseen
effect of the provision may, therefore, be locking in YouTube’s dominance in the EU”34.
2.2. The proposal disproportionately restricts fundamental rights
The value gap proposal, as provided in Article 13 and Recitals 37 to 39 of the draft Directive,
suffers from a number of fundamental problems. From the formal point of view, the proposal (i)
Several commentators have shown a concern with the proposal’s compatibility with Article 15
includes normative provisions in the recitals, (ii) lacks basic clarity, and (iii) uses trivially vague
E-Commerce, which establishes a prohibition on general monitoring obligations. In fact, the use
language. On the substantive side, if passed into law the proposal will (i) thwart digital innova-
of content recognition technologies necessarily involves such monitoring. And, again, the fact
tion and (ii) disproportionately restrict the fundamental rights of Internet users and platform
that the proposal applies only to some platforms is not enough to save it: the covered plat-
forms, however few they may be, will have to monitor all
of the new content that is uploaded
Given the seriousness of these flaws, the EU institutions should consider deleting or, at least,
onto them35. Christina Angelopoulos puts the point metaphorically: “[t]he chaff cannot be sepa-
significantly rewriting the proposal. The amendments put forward by former rapporteur Therese
rated from the grain without the thrashing of all the harvested wheat”36.
Comodini Cachia address some of the mentioned flaws and could form the basis of a possible
But the proposal’s incompatibility with the E-Commerce Directive is not, in and of itself, a de-
rewrite. Nevertheless, the amended provisions fail to give targeted platforms guidance regard-
cisive argument against the requirement of using content recognition technologies. A conflict
ing the appropriate and proportionate measures they should take, while preserving a risky
between Article 13 of the draft Directive and Article 15 E-Commerce would be solved by the
reference to content recognition technologies in Recital 39. At this stage, and considering the
well-known meta-rule lex posterior derogat legi priori
. EU institutions may well want to amend
extent of the necessary amendments, it should be kept in mind that it may be better to pass no
, in which case the later rule, introducing an exception to the general rule prohibiting
text than to pass a text that promotes legal uncertainty and threatens innovation in the digital
monitoring obligations, would prevail37.
But the commentators’ concern runs deeper than this. The conflict with Article 15 is particularly
worrying because it is, simultaneously, a conflict with the Charter of Fundamental Rights of the
EU. As hinted by the CJEU, the prohibition against general monitoring obligations is rooted
in Articles 8 (protection of personal data), 11 (freedom of expression and information) and 16
(freedom to conduct a business) of the Charter38.
In the name of safeguarding the interests of rightholders, an obligation to implement content
recognition technologies would disproportionately restrict the Internet users’ right to the pro-
tection of their personal data, as well as their freedom of expression and information. First, con-
tent recognition technologies would necessarily involve the “identification, systematic analysis
and processing of information” connected with the profiles of individual users, allowing them
to be identified39. Second, these technologies are not infallible: they often fail to adequately
distinguish between lawful and unlawful content, taking down uses that may be protected by
copyright exceptions40. Not long ago, it must be noted, the European Parliament invoked these
rights when rejecting the adoption at the EU level of enforcement strategies based on a three-
strikes policy (the so-called “graduated response systems”)41.
In addition, as suggested above, the obligation to use content recognition technologies would
gravely affect the platform operators’ freedom to conduct their business, since it would require
them “to install a complicated, costly, permanent computer system at [their] own expense”42.
Contrary to what is stated in its Recital 45, the draft Directive does not
respect the fundamental
rights enshrined in the Charter. The value gap proposal fails to strike a fair balance between,
on the one hand, (i) the users’ right to the protection of their personal data, (ii) the users’ free-
31 Urban et al. (2016), p. 58.
32 See infra
Angelopoulos (2017), pp. 37-38. See also
Husovec and Leenes (2016), pp. 47-48, reporting on the costs be-
hind the implementation of filtering technologies.
34 European Copyright Society (2017), p. 7.
35 I thus disagree with von Lewinski (2017).
36 Angelopoulos (2017), p. 36.
37 In any case, such a change should be made clear in the enacting terms of the Directive, rather than left tacit.
, C-70/10, paras. 46-50, and CJEU, Netlog
, C-360/10, paras. 44-48.
, C-70/10, para. 51, and CJEU, Netlog
, C-360/10, para. 49.
, C-70/10, para. 52, and CJEU, Netlog
, C-360/10, para. 50.
43 Although the CJEU has been assessing the validity of EU legislation against fundamental rights for some time
European Parliament, Resolution of 10 March 2010 on the transparency and state of play of the ACTA negotia-
now, it has been more open to engaging in such close scrutiny since the Charter became legally binding. See
tions, para. 11.
CJEU, Digital Rights Ireland
, C-293/12, in which the CJEU annulled the Data Retention Directive, on grounds of viola-
, C-70/10, para. 48, and
, C-360/10, para. 46.
tion of Articles 7 and 8 of the Charter.
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Copyright on Data
Data producer’s right: Powers, Perils and Pitfalls
Ana Ramalho, Maastricht University
On 10 January 2017, the European Commission issued its Data Economy Package, which includes
a Communication on building the European data economy1 and an accompanying Commission
Staff Working Document on the free flow of data and emerging issues of the European Data
Economy,2 followed by a Public Consultation. The initiative reveals the growing importance of
non-personal, machine generated data. It is grounded on the need for market players to have
access to large and diverse datasets in the context of the emergence of a data economy, as well
as on the goals of incentivizing the sharing of data, ensuring the free flow of data, protecting
investments and assets, and minimizing lock-in effects.3 The number of market players involved
in data trading as a means to develop new business models or to open up additional revenue
streams is expected to grow exponentially.4
Personal data is excluded from the scope of the communication,5 even though the Commission
recognises that some market players deal with datasets that contain both personal and non-
personal data6 (this would be the case, for example, of wearables that function as health and fit-
ness trackers). The data under consideration in the Communication are both non-personal (ei-
ther naturally non-personal, or turned non-personal through the process of anonymization) and
machine-generated (i.e., created without human intervention, through e.g. computer processes
or applications).7 Arguably, the exchange and access to this type of data is limited, with many
companies that de facto own the data generated by their products or services usually prefer-
ring not to share it, and, according to the Commission, even preventing the user who owns the
data-generating device from authorising use of the data by other companies.8
The Commission puts forth several possibilities to increase access to and sharing of data, such
as e.g. setting up default data contract rules, fostering the development of technical solutions
for reliable identification and exchange of data, developing a framework based on FRAND (fair,
reasonable and non-discriminatory) principles to provide access to data against remuneration,
or creating a data producer’s right. This contribution will analyse the latter solution. As the
Commission rightly points out, raw machine-generated data are not protected by any intellec-
tual property rights, and their economic exploitation and exchange is frequently ruled by con-
tract.9 Indeed, typically, IP rights are granted at the innovation (or expressed creativity) level.
By contrast, the production of data happens at an earlier stage in the data value chain, prior to
1 Communication from the Commission to the European Parliament, the Council, the European Economic and So-
cial Committee and the Committee of the Regions, “Building a European Data Economy”, COM(2017) 9 final, 10.1.2017
2 Commission Staff Working Document on the free flow of data and emerging issues of the European data econo-
my, SWD(2017) 2 final, 10.1.2017. [hereinafter, “SWD”]
3 Communication, at 4.
4 SWD, at 13, citing a Report from Consultancy IDC, “Europe’s Data Marketplaces – Current Status and Future Per-
spectives”, 2016, available at http://www.datalandscape.eu/data-driven-stories/europe%E2%80%99s-data-marketplaces-%E2%80%93-
(last accessed 17 August 2017).
5 Legislative initiatives concerning personal data have already been undertaken separately, see e.g. Regulation (EU)
2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with
regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/
EC (General Data Protection Regulation), or the review of the e-Privacy Directive (which resulted in a proposal for a
Regulation concerning the respect for private life and the protection of personal data in electronic communications,
COM(2017) 10 final, 10.1.2017)
6 Communication, at 9.
7 Communication, at 9.
8 Communication, at 9-10. See also SWD, at 15-16, where the Commission points to a notable exception to the al-
leged non-sharing trend: the bank BBVA shares anonymized and aggregated statistical data from millions of transac-
tions that can convey consumer’s habits or demographics.
9 Communication, at 10.
10 H. Zech, “A legal framework for a data economy in the European Digital Single Market: rights to use data”, Journal
of Intellectual Property Law and Practice
2016, 11(6), 460, 461.
The question therefore becomes whether the creation of a data producer’s right is an adequate
The Commission is also well aware of potential risks that the current situation might bring to the
solution. The next section will briefly describe the contours of the proposed right. The follow-
development of a sound data market. In fact, it should be noted that, in most cases, manufactur-
ing sections will focus on the merits of the right and analyse respectively its powers, perils and
ers or service providers de facto own the data, which could in theory lead to unfair contractual
terms of access to the data. The problem of access to data is – rightly – at the centre of the
Commission’s line of action,19 and even if the data producer’s right is in the end an exclusive
right over data, it is also mainly thought of as a way to ensure access, rather than as a way to
The data producer’s right
generate income from further uses of the data.20
As devised in the Commission’s Communication, the subject matter of the data producer’s right
is non-personal or anonymised machine generated data, including metadata on the data. The
Commission stresses that the data covered by the right should be at the syntactical, not the
semantic, level, and that care should be taken to ensure that ideas and information remain free.11
Even though the intentions of creating a new data producer’s right might be commendable,
This means that the object of protection is at the level of signs (such as sequences of 0 and 1),
such right would also have its shortcomings. Perils or immediate dangers include the fact that
not at the level of content of the information.12
creating a new right will add an extra layer of rights
to be cleared, which in turn can work
The owner of the right would be the data producer (i.e., the owner or long-term user of the
against one of the other objectives of building a data economy – the free movement of data.21
device), who would then have the exclusive right to use and authorise the use of the data (e.g.
Moreover, the right becomes especially problematic if one considers that non-personal data
through licensing). According to the Commission, this would include “a set of rights enforceable
becomes most valuable when used in large amounts (big data). Giving exclusive rights over
against any party independent of contractual relations thus preventing further use of data by
small amounts of data will hinder big data analytics (since the analysis would require acquiring
third parties who have no right to use the data.”13The right would be limited by exceptions grant-
lots of exclusive rights held by different owners), with potentially negative effects to the data
ing access to the data by others, namely the manufacturer of the device (who, besides having
a commercial interest in the data, might be obliged by national law to monitor the product) or
Furthermore, in practice, the manufacturer of the device could just resort to contracts to regain
public authorities (for, e.g., statistical information or urban planning).14 The Commission further
control of the data
(e.g. through an exclusive license), in which case de facto control becomes
envisages that, in certain cases, there might be a public interest in making the data available for
legal control. Put it differently, an IP right would not solve the problem of the de facto control,
other private actors, such as sharing smart metering information for purposes of fully enabling
since the manufacturer of the device will typically be in a stronger negotiating position and can
smart homes or care institutions.15 Along the same lines, an exception to the right could also be
contractually acquire the rights (a better solution for a situation of de facto control could be,
established to ensure access for research that is entirely or mostly funded by public resources.16
e.g., competition law).22
The right addresses a controvert question in the data economy – who owns the data? As point-
Yet another peril is the risk of information lock-ins
due to the difficulty in distinguishing the
ed out by the Commission, given the regulatory gap in this regard, the (de facto) owner of the
syntactical from the semantic level. The value of the data comes from the information it can
data is the company whose devices generate the data. The data producer’s right would shift
convey, and from the insights that can be derived from it (i.e., the semantic level); but the infor-
the (de facto) data ownership from the company that supplies the machines or devices to the
mation at the semantic level can be transformed into data (at the syntactic level), which means
user/owner of the device, allowing the latter to contract with other data-based service- and
that protection of one can entail protection of the other.23
device providers. This is connected to the objectives of the right, which are “clarifying the legal
situation and giving more choice to the data producer, by opening up the possibility for users
to utilise their data and thereby contribute to unlocking machine generated data.”17 Presumably,
clarifying the legal situation by attributing exclusive rights would avoid conflicts over owner-
ship, and giving more choice to the producer would contribute to fostering data access and
Mismatch between IP rationales and the data producer’s right
sharing (and thereby the data economy).
The first pitfall, or source of potential danger, is the mismatch between justifications or ratio-
nales for IP protection, on the one hand, and both the subject matter of the data producer’s
right (machine generated, non-personal data) and the objectives underlying the protection of
non-personal data, on the other hand. This mismatch could dictate the inadequacy of the right
Most EU legislative activity so far has occurred in the field of personal data. Non-personal data
to achieve the goals it is supposed to achieve.
had been largely overlooked until now. The objectives of the Commission’s proposals are laud-
able and include the improvement of access to non-personal machine-generated data, the facil-
itation of its sharing, and the protection of investment that also takes into account a fair sharing
of benefits with other players.18
19 Stakeholders have also highlighted that the main issue is access: see SWD at 35.
20 J. Drexl et al, “Position statement of the Max Planck Institute for Innovation and Competition of 26 April 2017
on the European Commission’s ‘Public consultation on Building the European Data Economy’”, 2017, at 8, avail-
11 SWD, at 34.
able at http://www.ip.mpg.de/fileadmin/ipmpg/content/stellungnahmen/MPI_Statement_Public_consultation_on_Building_the_EU_Data_
12 W. Kerber, “A New (Intellectual) Property Right for Non-Personal Data? An Economic Analysis”, 2016, at 7, avail-
Eco_28042017.pdf (last accessed 24 August 2018).
able at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2858171
(last accessed 23 August 2017); H. Zech, “Data as a
21 As pointed out by the Commission in the Communication, at 3, 5 et seq.
Tradeable Commodity”, in A. De Franceschi (ed.), European Contract Law and the Digital Single Market. The Implications of the
22 On the use of competition law in this context, see W. Kerber, “A New (Intellectual) Property Right for Non-Per-
, Intersentia, 2016, at 53-54.
sonal Data? An Economic Analysis”, 2016, at 17, available at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2858171 (last
13 SWD at 33.
accessed 23 August 2017); and, at length, J. Drexl, “Designing Competitive Markets for Industrial Data – Between
14 SWD at 35-36.
Propertisation and Access”, 2016, at 41 et seq., available at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2862975 (last
accessed 23 August 2017)
23 W. Kerber, “A New (Intellectual) Property Right for Non-Personal Data? An Economic Analysis”, at 18. Also high-
17 Communication at 13.
lighting the difficulty in distinguishing the syntactic from the semantic level, J. Drexl, “Designing Competitive Markets
18 Communication, at 11.
for Industrial Data – Between Propertisation and Access”, at 13.
Several theories compete regarding the justifications or rationales for intellectual property
It should be noted however that other rights, such as the sui generis right for databases or some
rights. Each of them is conducive to a different analysis of the same IP policy, but new exclusive
neighbouring rights, have a slightly different justification – the protection and/or promotion of
rights should be viewed from the perspective of all of them before they are introduced in the
investment.32 It is the case, for instance, of the neighbouring right of the film producer33 or the
sui generis right of the database maker.34
The personality rights theory, for which mainly the philosophers Kant and Hegel are responsible,
It is doubtful that a data producer’s right could be devised as a neighbouring right as such.
holds that the work is worthy of protection because it is an expression of the personality or self
Neighbouring rights is an umbrella category that encompasses rather different subject mat-
of its creator.25 Not all types of intellectual property can be justified by this theory; rather, only
ter, but generally they aim to protect activities somehow related to copyright. Their object is
those that entail some level of personality or self-expression (such as copyright).26 This connec-
the dissemination – not the creation – of works which are often literary and artistic works.35
tion to the personality of the creator is at odds with the very nature of the subject-matter of the
Raw data which is machine-generated does not fall under copyright, which means that the
data producer’s right (non-personal data).
link between a (possible) neighbouring right and copyright is not present in the case of a data
The labour theory, formulated by the British philosopher John Locke in the 17th century, implies
producer’s right. This makes it difficult to justify the use of a neighbouring right for the case of
that every man should be the proprietor of the product of his labour. This theory suggests the
non-personal machine generated data.
idea of “reward”, as it would seem fair that whoever uses his or her intellectual labour to create
The last possibility available would be to have a sui generis right for data producers, which
or to invent should have a right over the ensuing product.27Non-personal, machine generated
would have as its main justification the protection and/or promotion of investment. However, if
data does not fit this construction, as there is no intellectual labour in the production of such
the data producer’s right is designed as a “one size fits all”, it should also be considered whether
data. There might be intellectual labour involved in creating devices and sensors for the pro-
all investments (from owners or long-term users of devices) are worth protecting. This problem
duction of data – and those devices and sensors could be protected by an IP right if conditions
is connected to another issue: as the Commission rightly notes, it is hard to identify clear pat-
are met – but not in the further production of data itself.
terns across different sectors, with usage rights being dependent on context and the particular
Finally, the utilitarian theory considers that IP rights are necessary to promote or incentivize
service provider.36The specific relation at stake – B2B or B2C – also plays a role when it comes
to the importance of non-personal data to the data producer. Arguably (and on average), the
28 but also the efficient use and commercialization of the creation
or invention after it has been produced.
consumer who generates non-personal data through his or her fitness tracker will be less inter-
29Under this theory, IP rights are positive rights (as op-
posed to natural rights), granted with the goal of furthering societal welfare. In other words,
ested in questions of (non-personal) data ownership than the owner of a smart factory’s ma-
IP rights are granted to creators and inventors with the goal of promoting further creation and
chinery; the former will also have invested less in acquiring the device/machine than the latter.
inventive activities, and the dissemination of the outcomes from said activities (namely, through
This means that a legislative solution designed as a “one size fits all” measure may in any case
licensing). It is doubtful that the utilitarian rationale, based on the idea of incentive, can justify
be inadequate and premature, regardless of its legal form. Moreover, most of the stakehold-
the creation of an IP right in data. Data is produced independently of incentives; there is no un-
ers that participated in a study about the European Data Market are satisfied with current ar-
derproduction of data that needs to be remedied (in fact, quite the contrary is true).
rangements (mainly contractual) for the exchange of data, conveying that the current levels of
30 It is not
because of the existence of an exclusive right over data that users of devices that generate data
data exchange and re-use do not seem to cause problems to the market efficiency.37In its Staff
will start producing more data. Likewise, a new exclusive right will also not facilitate access or
Working Document, the Commission further notes that stakeholders consider it more relevant
sharing, as firms are able to trade data without having exclusive rights on it (mainly relying on
to define rights of access to data than to define ownership rights.38 Altogether, it is doubtful
their de facto control).
that there is an investment worth protecting in every case where a data producer’s right would
31 The incentive rationale for the creation of an IP right in data is thus not
Moreover, IP rights, including neighbouring rights or the sui generis right of databases, share
one common trait – they stem from human creativity or effort (be that effort financial or intel-
lectual), to a greater or lesser degree. Machine-generated data seems to be one step further
than that – it can be generated automatically, without any human intervention (apart from the
32 This is true for some neighbouring rights – such as the rights of producers – but not for others – such as the rights
of performers. Protection for the latter is based on social objectives and natural rights arguments, as well as on utili-
tarian arguments – see M. van Eechoud et al., Harmonizing European Copyright Law. The Challenges of Better Lawmaking
Kluwer, 2009, at 186-194.
24 As proposed by R. Spinello & M. Bottis, A Defense of Intellectual Property Rights
, Edward Elgar, 2009, at 171-172.
33 Recital 5 of Rental Right Directive (Directive 2006/115/EC of the European Parliament and of the Council of 12
25 J. Hughes, “The Philosophy of Intellectual Property”, 77 Georgetown Law Journal
, 287, 330 and W. Fisher, “Theories of
December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual
Intellectual Property”, available at http://www.law.harvard.edu/faculty/tfisher/iptheory.html
(last accessed 22 August 2017).
property (codified version), O.J. L 376, 27 December 2006): “(…) the investments required particularly for the pro-
26 R. Spinello & M. Bottis, op.cit.
duction of phonograms and films are especially high and risky. The possibility of (…) recouping that investment can
27 See also R. Spinello & M. Bottis, op. cit.
, at 155 et seq.
; Hughes op. cit
. at 296; Fisher op. cit
be effectively guaranteed only through adequate legal protection of the rightholders concerned.”
28 R. Spinello & M. Bottis, op. cit.
, at 166.
34 Recital 12 of the Database Directive (Directive 96/9/EC of the European Parliament and of the Council of 11 March
29 See e.g. regarding patents J. Kesan, “Economic rationales for the patent system in current context”, George Mason
1996 on the legal protection of databases, O.J. L 77, 27 March 1996): “(…) an investment in modern information stor-
2015, 22(4), 897, 902-903.
age and processing systems will not take place within the Community unless a stable and uniform legal protection
30 W. Kerber, “A New (Intellectual) Property Right for Non-Personal Data? An Economic Analysis”, 2016, at 8-9,
regime is introduced for the protection of the rights of makers of databases.”
available at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2858171
(last accessed 23 August 2017).
35 C. Colombet, “Major principles of copyright and neighbouring rights in the world: a comparative law approach”,
31 W. Kerber, “Governance of Data: Exclusive Property vs. Access”, IIC 2016 (7), 759, 761. The same author, in “A New
1987, at 87, available at http://unesdoc.unesco.org/images/0007/000750/075056eo.pdf
(last accessed 23 August 2017).
(Intellectual) Property Right for Non-Personal Data? An Economic Analysis” points out at 14: “First analyses about
36 SWD, at 16. Also pointing out the problems with the “one size fits all” approach, J. Drexl, “Designing Competitive
the problems of [data] markets do not indicate that legal questions about data ownership (…) are the main impedi-
Markets for Industrial Data – Between Propertisation and Access”, at 40.
ments to a faster development of data markets. Rather, the problems are seen to lie in an insufficient demand for
37 IDC and Open Evidence, European Data Market SMART 2013/0063 Final Report, 1 February 2017, at 139, available
data (..).”. See also, at length, J. Drexl, Designing Competitive Markets for Industrial Data – Between Propertisation
at http://www.datalandscape.eu/study-reports (last accessed 22 August 2017).
and Access”, at 33-34
38 SWD at 35.
initial one of, e.g., setting up the sensors). The fact that the subject matter of protection is ma-
The creation of data left outside the scope of the sui generis right includes in principle data
chine-generated is, in and off itself and independently of the concrete IP right at issue, at odds
generated by machines. In any case, at least in theory, many businesses could have (an aspect
with the essence of IP.39
of) non-personal data protected via the Database Directive if they so wished, because e.g. they
On a general note, it should be recalled that the underlying justifications for a data producer’s
invest in the presentation of the contents via an app. Admittedly, however, this is not in the
right are to clarify the legal situation and to foster data access and sharing. It can be questioned
interest of all de facto owners of data, with some preferring to keep the data to themselves
whether an exclusive, IP-type of right is the best way to achieve this. There are other options
(for purposes of product improvement, for instance). More importantly, it can be difficult to
that can clarify the legal situation (thereby also avoiding potential conflicts of ownership over
differentiate investment in creating or producing the data (for example, through sensors) and
data). Indeed, the Commission lists a few, such as developing a framework based on fair, rea-
investment in obtaining or collecting it47 (which in the case of machine generated data could be,
sonable and non-discriminatory (FRAND) terms of access, or setting default contract rules,
e.g., assembling the data from several devices into files). Where it is not possible to distinguish
which would seemingly be more compliant with the principle of proportionality.
between creating and obtaining the data, or where the activity of obtaining the data is “indi-
41 In addition,
as mentioned above, a potential data producer’s right would be applicable throughout a wide
visibly linked” to the creation of data, the CJEU has considered that there is no independent
variety of industries, which have different business models. Deciding upon an initial allocation of
investment in obtaining the data (thus denying protection to the database on those grounds). 48
rights to the data producer disregards the specific governance structures of different business-
Moreover, depending on how a potential data producer’s right is designed, conflicts might
es and can turn out to be the economically wrong allocation.42 Moreover, new exclusive rights
arise due to the fact that the database and the machine-generated data (which might later go
typically lead to conflicts and litigation.43 As to the goal of fostering data access and sharing, as
in the database) have different owners: the owner of the former will be the database producer,
explained above, granting exclusive rights over data does not necessarily give an incentive to
while the owner of the latter will be the user who owns or is in possession of the device. Even
share. In theory, an exclusive right over a particular subject matter, coupled with broad, man-
though the manufacturer would have a non-exclusive access to the data, determining potential
datory limitations, might offer more access to said subject-matter than e.g., a sole reliance on
infringement by third parties could be challenging.
contracts; however, there are alternatives to this route, namely, regulating access (and thereby
trumping potential unfair/one-sided contracts).44 To sum up, not only do IP rationales not sup-
Drawing the line between personal and non-personal data
port the introduction of an IP-type of right for data producers, but also the objectives of the
In some devices such as wearables, personal and non-personal data are intertwined, and it
data producer right could not be achieved through the grant of an IP-type of right.
might be difficult to draw the line between them. Importantly, such line must be drawn, as per-
Relationship with the database directive
sonal data is subject to its own specific regime in the EU. Personal data concerns information
where a natural person is identified or identifiable, including personal data that have undergone
The Database Directive grants a sui generis right to the database maker who has made a sub-
pseudonymization but that could be attributed to a natural personal by using additional infor-
stantial investment, quantitative or qualitative, in obtaining, verifying or presenting the contents
mation.49 In the assessment of whether a person is identifiable, account should be taken of the
of the database (article 7 of the Database Directive). Databases are defined in the Database Di-
means used to do so, such as singling out, including its cost and amount of time required for
rective as “a collection of independent works, data or other materials arranged in a systematic
identification.50 According to Article 4(1) GDPR, a natural person is identifiable by reference in
or methodical way and individually accessible by electronic or other means” (Article 1(2)).
particular to “a name, an identification number, location data, an online identifier or to one or
In principle, the new right would cover a gap of protection left by the Database Directive: the
more factors specific to the physical, physiological, genetic, mental, economic, cultural or social
period before the data is collected (i.e., “obtained”) by the database maker. The Database Di-
identity of that natural person”. The CJEU has added to this list an IP address.51 The Court has
rective states clearly that the sui generis right should not give rise to a new right in data.
also stressed that, in order to treat information as personal data, it is not necessary that that
object of protection of the sui generis right – the database, or the investment made in the data-
information alone allows the data subject to be identified.52The definition of “personal data”
base – is thus different than the object of protection of a data producer’s right, which concerns
is thus by no means straightforward. In addition, the nature of data is dynamic and subject to
raw, machine-generated data itself.
change. Anonymous data can be deanonymized, for example, by matching it with other data-
sets and applying some probability theory.53 This makes the distinction between personal and
It should be noted that investment in obtaining data is not akin to investment in creating data.
non-personal data a moving target.
The CJEU has clarified this question in several cases. The resources used to “seek out indepen-
dent materials and collect them in the database”46 amounts to an investment in obtaining the
data, and this activity can thereby give rise to a sui generis right; but the resources used for the
creation of such data are outside of the scope of the sui generis right. This interpretation results
in many sole-source databases going unprotected, thus addressing competition concerns.
Enhancing data sharing and access and doing away with legal uncertainty in data markets are in
themselves praiseworthy objectives. The solution of achieving them through introducing in the
legal order a new property, IP-type of right is however not the best course of action.
39 See however, as an exception to this, Section 9(3) of the Copyright Designs and Patents Act of the United King-
47 E. Derclaye, The Legal Protection of Databases. A Comparative Analysis
, Edward Elgar, 2008, at 94-96. M. Davison & P.B. Hu-
dom, which vests protection of computer generated works in the person by whom the arrangements necessary for
genholtz, “Football Fixtures, horseraces and spin offs: the ECJ domesticates the database right”, E.I.P.R.
the creation of the work are undertaken.
40 Communication at 12-13.
48 Oy Veikkaus
, at 44; Svenska Spel
at 33; OPAP
41 A proportionality check involves the evaluation of three factors: the suitability of the measure for the attainment
49 Recital 26 of the General Data Protection Regulation (GDPR) (Regulation (EU) 2016/679 of the European Parlia-
of the objective; the necessity of the measure; and the proportionality of it vis-à-vis the restrictions that might be
ment and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of per-
thereby involved, or proportionality stricto sensu
inter alia case C-331/88 Fedesa
, para. 13, and case C-210/00 Käserei
sonal data and on the free movement of such data, and repealing Directive 95/46/EC), O.J. L119, 4 May 2016.
paras. 59-67. For a detailed explanation of the factors, see X. Groussot, General Principles of Commu-
, Europa Law Publishing, 2006, at 146-152; J.H.Jans, “Proportionality Revisited”, Legal Issues of Economic Integration
51 In case C-582/14 Breyer
, the CJEU has considered that in cases where the IP address is capable of sufficiently iden-
2000, 27(3), at 240 et seq
., and references therein.
tifying a natural person (because the provider has means to identify the person with additional data) such address
42 W. Kerber, “A New (Intellectual) Property Right for Non-Personal Data? An Economic Analysis”, at 15-16.
amounts to “personal data”(see para. 49 of the decision).
43 J. Drexl, “Designing Competitive Markets for Industrial Data – Between Propertisation and Access”, at 35.
, para. 41.
44 J. Drexl, “Designing Competitive Markets for Industrial Data – Between Propertisation and Access”, at 36.
53 M. Thomas, “Big Data: The Broken Promise of Anonymisation”, 2016, available at https://www.gresham.ac.uk/lectures-
45 Recital 46 Database Directive.
(last accessed 22 August 2017). See also, underlining this dynamic
46 Case C-46/02 Oy Veikkaus
, at 34; case C-203/02 British Horseracing Board
at 31; case C-338/02 Svenska Spel
, at 24; case
nature of data, S. Stalla-Bourdillon & A. Knight, 2017, available at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2927945
, at 40.
(last accessed 22 August 2017).
The fabric of a data economy is not compatible with exclusive, crystallised IP rights: a data pro-
Text & Data mining Issues
ducer’s right would add an extra layer of rights to the legal order, which could hinder the free
Valérie Laure Benabou, University of Aix-Marseille, member of the CDE research center
flow of data; rights over small datasets would be at odds with the big data analysis that under-
lies the data economy; and exclusive rights over data could also lead to information lock-ins.
Text & Data mining arise several types of issues, some of which are related to intellec-
tual property rights whereas some depends on infrastructures or bargaining power. Since
None of the justifications for having IP rights are fulfilled in the case of a right over data. There
those questions cannot totally be ignored in order to delineate a proper regime for TDM.
is no connection to the personality of the creator, nor to its intellectual labour. No incentives
But as the purpose of this meeting is to reflect about the copyright rules, we will mostly
are needed to produce or disseminate data. Even the case for a sui generis right is weak, since
focus on the possible solutions related to the use of the protected subject matter in the
there is no investment worthy of protection or promotion (at least not in all cases where a data
process of TDM (part II
), after having quickly defined the core elements of the discussion
producer’s right would be applicable).
The interaction of the data producer’s right with existing regimes, namely the sui generis right
for databases and the protection of personal data, could also lead to conflicts and result in legal
Part I. What is TDM ?
The objectives of the Commission would thus be better achieved through other options men-
Definitions of TDM that can be found in the studies or in the existing laws (Japan, UK, Irlande,
tioned in its Communication, which sound both more efficient and realistic. Such is the case, for
France) may vary according to the social use of the process. Some are restricted to certain
instance, of the implementation of an obligation to license the re-use of data under fair, reason-
kinds of subject-matter, for example, written texts because the first process of mining occurred
able and non-discriminatory terms (FRAND), or developing guidelines to incentivise businesses
in the field of scientific research that mostly relies on publications. But the potential technical
to share non-personal data. These and other options should be better explored and take prece-
application of TDM is wider and encompasses any sort of works/contents as long as it is in a
dence over a data producer’s right, always bearing in the mind that the main focus of any option
digital format. So images, video, music but also “pure” information can be subject to mining
taken should be fostering access to data.
whenever there is a possible “use” of the results of the process. Some definitions also limit the
TDM to certain uses or purposes – such as research or journalism…- because, here again – it is in
those fields that the practice and the claims have emerged. But the ongoing debate shows that
the applications of such processes can cover industrial developments, leasure...
Such a contextual approach of TDM does not seem to be the proper starting point to address
the issue in the forthcoming directive because the technical evolution and the orientation of the
market that cannot be fully anticipated may extend the scope of TDM beyond the existing pat-
tern. Therefore, the first step will consist in finding permanent criteria that sketches the skeleton
of TDM, regardless of the actual practices. This structural definition being achieved, then comes
the time to discuss the opportunities to welcome this process or not when it conflicts with other
legitimate interests, which is a matter of policy.
The first invariable criterion is the digital format of the source subject to the process of min-
ing, the second is the existence of a process involving specific tools, the third is the purpose
for which the process of the element is being made (animus), the fourth is the constitution of a
result of the process that is new/different from the source mined.
In order to actually realize TDM, it is necessary to have access to the “source” (the mine) and
to the tools allowing the process (the picks and shovels); to search something and to have a
reasonable expectation of the results that may derive from the searching activity (the opportu-
nities of exploitation of the ore).
Many of the elements required to achieve TDM are irrespective of copyright issues such as the
need for technical infrastructure and investment allowing the miners to dig, the market oppor-
tunities for the results of mining. If TDM is considered to be encouraged for social benefit, policy
makers might therefore take into consideration these various needs and eventually intervene in
order to build the necessary foundations in case the market does not provide for – investing in
digitization, establishing norms for formats, facilitating open or broad availability of the content
and the technical tools, developing storage, cloud computing facilities… It is also noticeable that
access to information is not always locked by IP rightholders but may be the mere results of
contractual practices and/or technical control of access of individual or companies regardless
of any IP consideration.
Therefore, solving the copyright issues that may conflict with TDM will not be the only key for
suddenly developing the market of the applications of TDM in Europe, this will also be a matter
of education, investment, interoperability, open data policy.
Some publisher’s opponents to the TDM exception point out that they don’t face an important
demand for TDM license when required (hardly few licenses a year) and that they easily come
to an agreement in this case. Many reasons may explain why they experience such a situation
(people don’t ask permission because they don’t know they have to, they know but they fear to
ask because they don’t know how to and what will be the cost, they don’t want to ask on behalf
ger the protection because investment has been protected. According to the rules governing
their freedom of action) but societal and infrastructure impediments may also be an explana-
the relationship between copyright and related rights, it would be paradoxical to consider that
the use of the data in the work is free because of the form/information dichotomy whilst the use
This is not to say that copyright questions don’t matter but that the potential conflict with
of the data in the related right is not. If TDM is to be enhanced because of its social function, it
copyright rules and the TDM will not solve the whole problem. In balancing the pro & cons of
is questionable to dissociate its regime according to the various regimes of the sources.
the limits to copyright rules, the policy maker shall also take into consideration the reality of the
Yet, if we stick to mere copyright consideration, it could be argued in order to limit the conflict
social benefit of the TDM.
between the claim for free use and the exclusive right that TDM does not access to and/or use a
“work” per se, according to a” functional” conception
of what a work is. For example, in France
some decisions (see example in France: Etre et Avoir / Place des Terreaux) have considered
Part II. Which are the problems with mining vis-à-vis copyright issues?
that there was no reproduction of the work “as such” when the public could see it (architectural
work or drawing) in the frame of a wider image or in a film but that the work was not the subject
Going back to the “bony” definition of TDM, TDM uses may encroach on Intellectual property
of this image. Instead of relying on a legal exception to the exclusive right (namely panorama
and ancillary copy that was not existing in the law) the judges answered at the upper level and
The “source” of the TDM might be protected by different rights – copyright, neighbouring rights,
decided that the work as a legal concept was not sufficiently “present”; therefore, that there
sui generis rights on databases-. So access to the source may – in certain circumstances – trig-
was no infringement of the copyright. It is the metaphor of the puzzle:
even if all the pieces
ger the application of IP rules.
of the puzzle are present,
the recombination of all of them do not amount to the same source.
The type of tool used to mine may also raise questions of IP when it comes to the acts of exploi-
Consequently, one of the first answer that could mitigate the conflict between TDM and copy-
tation involved in the process or compliance thereof with the digital right management.
right would consist in defining the works subject to protection in the acquis – when this defini-
The assessment of the purpose/intent may also be taken into account when considering the
tion only exists for computer programs, databases – and/or determining the situations when
balance between the claim for exclusive right on the one hand and the claim for accessing to
the work would not be protected because the function of copyright has not been harmed. Ac-
and processing the content. At this stage, this shall be limited to a conflict of principles– who is
cordingly, all the works would not be protected and some could be explicitly excluded from
entitled to mine with which project against the legitimacy of the rightholder position.
the scope of copyright and the protection of the work would not be absolute but may depend
on the function provided for in the copyright legislation. Still even in introducing in the direc-
Finally, the opportunities of “exploitation” of the result of the mining may also be balanced ac-
tive the distinction between expression and information, or establishing that the protection is
cording to the competing interest of the rightholder to benefit from its property.
limited to work “as such” it is rather unsure that it would provide enough legal security and fulfil
the objective of harmonization of the situations within the different Member States.
2.1. Mining a “protected” material
One can also think of relying on the concept of originality and consider that the threshold of
This paper will not detail the famous distinction between the “form” of expression that is the
protection is not met in certain cases. This question has been addressed by the Court of Jus-
subject protected by copyright rules and the mere information or ideas that are outside of the
tice in the famous Infopaq
case (rendered about clipping practice of the press aggregators)
scope. We shall only insist on the fact that the distinction is legally and practically fragile. Even
and the judges held that reproduction of small pieces of the work – extracts of 11 words – was
if one might find some traces of the distinction in the international and European “acquis” such
to be considered according to the originality criterion. The decision has been interpreted as
as the article 9.2 of TRIPS agreement or article 2 WCT and more specifically in the computer
acknowledging the originality of the pieces but I think that we can also see it the other way
program directive article 1.2 (Protection in accordance with this Directive shall apply to the ex-
round like establishing the possibility that the originality threshold is not sufficiently fulfilled in
pression in any form of a computer program. Ideas and principles which underlie any element of
certain cases and that the judges have to control the existence of the originality of the “pieces”.
a computer program, including those which underlie its interfaces, are not protected by copy-
It would not be sufficient for the rightholder to prove that the source as a whole was original to
right under this Directive.)
prevent the use of the pieces, since it should also be demonstrated in this case that the pieces
it is still complicated to draw a line between the form and the information whenever access to
are also – as such- original. So legislative intervention could consist in defining a general thresh-
information supposes reproduction of the form in which this information has been expressed.
old of originality.
(Information comes from the latin in formare). Even if the word “data” refers to raw material –
Still, even if defining what a “protected work” means as regards EU law would certainly be
less structured than information – the reference to the “text” as the potential scope of applica-
needed in the broader perspective of a coherent copyright code, and may help to delineate
tion of the process of mining applies both to non-protected elements and to protected works.
when a “work” is used, it does not seem to match the short-term perspective of the ongoing
When both elements are so intertwined that they cannot be separated, it is somewhat artificial
to claim that such can be the case for TDM.
Besides, many copyright rules do cover the use of the information/idea/content. The value of
2.2. Mining as an act covered by IP rights
the work is also linked to the amount of information it provides to the public – see the news-
Besides, as regards TDM, the difficulty lies in the fact that the process involves technical repro-
paper-; the content is indirectly covered by the copyright protection when an authorization is
duction of works and that the Infosoc Directive cover any kind of reproduction by an exclusive
required for the adaptation of a novel into the movie: it is the story, the characters that matter
right (art. 2) (Member States shall provide for the exclusive right to authorise or prohibit direct
here and not the choice of a specific sentence. When considering moral right to integrity, dis-
or indirect, temporary or permanent reproduction by any means and in any form, in whole or in
torting the “spirit” of the work may amount to an infringement before certain jurisdictions. Fur-
part). This very broad definition of the reproduction right has been heavily criticized by many
thermore, the form/information dilemma has less echo in the realm of neighboring rights and
authors in France because our definition (still) requires an act of communication to the public
sui generis rights for databases. Even if the 1992 directive remain quite silent on the definition
of the work (Article L. 122-3 Code de la propriété intellectuelle: Reproduction shall consist in
of the subject-matter (phonogram, film...), of the producer or performer rights the ECJ and the
the physical fixation of a work by any process permitting it to be communicated to the public
recitals of the various directives seem to acknowledge that the justification for protection lies
in an indirect way.)
in the investment made by the producer, just as the maker of the databases for the sui generis
right, whereas the performers rights are covering the performance and its fixation. If access to
the data contained in this “material” supposes any process of copying of the file, this might trig-
According to this requirement, it can be argued that some acts of reproduction are not covered
such a social value that justify to overcome the protection of innovation by intellectual property
by the definition of the exclusive right since they don’t permit to the communication to the pub-
rights? Is there not a risk that the second “innovator” would claim exclusivity over its own in-
of the work. What is communicating the work to the public? I don’t refer here to the flimsy
novation after having deprive the first innovator from its protection?
definitions provided for by the Court of Justice in its numerous case-law but to a “sensitive”
Shall the means-process be related to the genuine project? If yes, has the framework of the TDM
perception of what is an act of communication towards human being. Is a work communicated
to be determined ex ante
and the proportionality of the extraction to be assessed in consider-
to the public when the recipient cannot perceive, recognize it? When considering copyright
ation of the project? (De minimis approach) ? Shall the legislator “force” the access to the data
infringement, the judge compares the resemblances between the work and the copy: it is a “hu-
and overcome the contractual/technical barrier? Shall we apply the essential facilities doctrine
man” appraisal of where the work has been reproduced. So keeping a broad definition of the
ex ante ? ex post ?
right of reproduction covering any kind of reproduction – even individual, temporary, transient,
partial, automatic- may, at the end of the day, be inconsistent with the assessment of the in-
Shall the destination of the mining be subject to any form of control? Springer, for example, re-
quires to know who is mining what. Is it legitimate? What are the opposite interests that justify
that such a control would be forbidden (either in an exception or in the licensing framework) ?
So an answer to TDM but also to other issues (linking, transient copies) may consist in intro-
ducing a condition of human identification of the work
. Copyright protection would only be
What are the types of acts necessary to fulfill the legitimate purpose (copying, storing, display-
involved as far as the work is perceptible, recognizable by a human (and not a mere machine):
ing?). The Comodini report expressed concern about the possibility to verify the reliabily of
the material presence of the work would not be sufficient to infringe copyright if this presence
source, which supposes a storage capacity and the organization of the access to the data set.
is not somehow perceptible by the public. Article 5.1. of the Infosoc directive establishing the
Such a concern may not be as justified for other purposes than scientific research.
transient exception relies somehow on this assumption of human perceptibility when saying
that the reproduction which is necessary to the transmission of work in a network is “exempted”
2.4. Exploiting the results and the fair share of revenues
from the reproduction right. But instead of establishing positively the condition in the definition
Once all these elements have been discussed, one might also take into account the “value gap”
of the exclusive right, it is in the rationales for a mandatory exception.
Being a pragmatic person, and though I regret it, I don’t believe that the legislator will have the
Here again many questions may be answered to:
courage to introduce such a “perceptibility” condition in the definition of the exclusive rights
but will overcome the difficulty with exceptions. This requirement would indeed - in the pres-
Does TDM compete with the normal exploitation of the work? It yes is an answer, then the leg-
ent context of value gap - deprive the rightholders from the possibility to be associated to the
islator cannot adopt an exception because it would not be consistent with the three-step-test.
value deriving from the automatic processing of their work, which appears to be a very promis-
The solution would may be consist in providing a reasonable frame for licensing (but the experi-
ing market. Yet, it is my belief that mass digitization of works - whatever the purpose is: linking,
ence of License for Europe makes this rather uncertain).
mining, crawling- implies other answers than the mere individual exclusive right and that estab-
If there is no such competition, is there an economic prejudice suffered by the rightholders that
lishing a differentiated regime of protection depending on the existence of a “sensitive” contact
shall trigger a fair compensation? To which extent mining content harms the rightholder eco-
of the human being with a work at the end of the process would be a solution.
nomic rights? Is it different if the exploitation of the result of the mining is commercial or not?
As to TDM, art 5.1. provides a part of the answer and may cover most of the reproduction acts
If there is a specific investment by the rightholder (formats, accessibility of the dataset), shall
involved in the process of mining. This appear in the directive proposal, where it is recalled that
this be taken into account in a licensing framework or in the realm of the exception?
the future exception has to be combined with the former one. This “distributive” approach is
nevertheless a complicated one. Many of the operations involved in the mining can be covered
by article 5.1. exception, and it can be argued that a specific exception for TDM is not required.
Yet, the pro TDM exceptions consider that some conditions – temporary copy, absence of eco-
nomic significance - as interpreted by the Court (Infopaq, Meltwater…)
may nevertheless im-
pede certain activities. This has to be scrutinize because for example, the absence of economic
significance condition has not been an obstacle to the commercial exploitation of a service
subsequent to transient copies as long as it is not the exploitation of the work itself.
Consequently, providing for a supplementary exception is only meaningful if it extends the
scope of the free uses to certain activities that have a legitimate interest to be balanced with
the legitimacy of copyright protection.
2.3. Mining as a legitimate reason to cope with (social value)
Considering that, in some situations, there is a need for a specific regime of TDM that goes
beyond the transient exceptions, the acts that exceed the scope of this exception shall be as-
sessed in the perspective of the social interest and value of the project that grounds the TDM.
Answers may also vary according to the social value of the activity and to the context of the
project: individual authorization, collective management, exception. In this perspective, the leg-
islator shall address several questions:
Are all intent, purposes equally valuable? If not, the TDM project may be assessed according
to the social need: scientific research, collecting news (subjective approach). We see the op-
position between the commission proposal and the Comodini report that extends the scope of
the exception irrespective of the quality of the institution and to “innovation”. Is innovation as
Data Property: Unwelcome Guest in the House of IP
P. Bernt Hugenholtz
Institute for Information Law (IViR), email@example.com
[publication forthcoming in Kritika. Essays on Intellectual Propert, Vol. III] © Hugenholtz
With the incessant growth of the ‘data-driven economy’1 have come calls for the introduction of a
novel property right in data. Apparently in response to demands from the automotive industry,2
and encouraged by a number of German lawyers and scholars,3 the European Commission has
in its 2017 Communication on ‘Building a European data economy’ tentatively advanced the
idea of creating at EU level a ‘data producer’s right’ that would protect industrial data against
the world.4 The movement for ‘data property’ (in German Dateneigentum
) has its champion in
European Commissioner Günther Oettinger, who until 2016 led the directorate general that is
responsible for the Communication, DG Connect. An op-ed published by Mr. Oettinger in the Frankfurter Allgemeine Zeitung
reveals some of the thinking and the powerful forces behind
this revolutionary legal concept. Data, writes Oettinger, are the “gold of the future”, principally
in the automotive sector where modern sensor-equipped cars automatically generate and col-
lect large amounts of data – on traffic and road conditions, engine performance, etc.5 These
machine-generated sensor data have enormous value, for example, for developing self-driving
automobiles. But – writes Oettinger – it is as yet unclear who owns these data: the automobile
manufacturer; the car owner; the producer of the sensor equipment; or no one at all? What we
need, concludes the Commissioner, are rules at EU level that establish data ownership.6
Apparently inspiring this call for protecting industrial data is the fear – common to other recent
policy initiatives – that valuable European assets are being misappropriated by large American
companies. The specter of Google ‘stealing’ European news has already led to an ongoing EU
initiative towards a neighbouring right for news publishers, following comparable rules previ-
ously introduced in Germany and Spain.7 The sui generis database producer’s right introduced
in Europe in 1996 was similarly inspired by European fears of dominance by the US database
Although the contours of the ‘data producer’s right’ being contemplated by the European Com-
mission are sketchy, as are its economic underpinnings, such a right would most likely bring the
protection of industrial data in the EU to a much higher level than the – much-maligned and still
Data-Driven Innovation: Big Data for Growth and Well-Being
2 Christiane Schulzki-Haddouti, ‘Wem gehören die Daten im Auto?‘, VDI Nachrichten
, 15 April 2016, available at
http://www.vdi-nachrichten.com/Technik-Gesellschaft/Wem-gehoeren-Daten-im-Auto. The German industry coali-
tion BDI (Bundesverband der deutschen Industrie) does not however support the idea of a property right in data.
See BDI, ‘Industrie 4.0 – Rechtliche Herausforderungen der Digitalisierung Ein Beitrag zum politischen Diskurs‘, No-
vember 2015, available at https://bdi.eu/media/presse/publikationen/information-und-telekommunikation/201511_
Industrie-40_Rechtliche-Herausforderungen-der-Digitalisierung.pdf. See also heise online‚BDI spricht sich gegen
neues Eigentumsrecht an digitalen Daten aus‘, available at https://www.heise.de/newsticker/meldung/BDI-spricht-
3 See, inter alia, T. Hoeren, ‘Big Data and the Ownership in Data: Recent Developments in Europe’,  European
Intellectual Property Review
751-754; A. De Franceschi & M. Lehmann, ‘Data as tradable commodity and new mea-
sures for their protection’, 1 Italian Law Journal
(2015) 51-72; H. Zech, ‘A Legal Framework for a Data Economy in the
European Digital Single Market: Rights to Use Data’, 11 Journal of Intellectual Property Law & Practice
4 European Commission, ‘Building A European Data Economy’, Communication from the Commission to the Euro-
pean Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, 10
January 2017, COM(2017) 9 final, 13. See in particular: European Commission, ‘Staff Working Document on the free
flow of data and emerging issues of the European data economy’, Brussels, 10 January 2017, SWD(2017) 2 final, 33-
5 The German automobile association ADAC has conducted tests showing that modern automobiles produce, pro-
cess, store and forward vast amounts of machine-generated data; available at https://www.adac.de/infotestrat/
6 G. Oettinger, ‘Wem gehören die Daten?‘, Frankfurter Allgemeine Zeitung
, 14 October 2016.
7 European Commission, Proposal for a Directive of the European Parliament and of the Council on Copyright in the
Digital Single Market, 14 September 2016, COM(2016) 593 final, art. 11 (Protection of press publications concerning
8 P.B. Hugenholtz, ‘Something Completely Different: Europe’s Sui Generis Database Right’, in: Susy Frankel & Daniel
Gervais (eds.), The Internet and the Emerging Importance of New Forms of Intellectual Property
controversial – database right. Whereas database right protects data on the double condition
policy and legal framework conditions for the data economy are put in place in time, its value
that the data are structured in a ‘database’ and the database is the result of ‘substantial invest-
will increase to EUR 643 billion by 2020, representing 3.17% of the overall EU GDP”.15 Studies by
ment’, the novel right would directly protect machine-generated data without any material
the OECD and the European Commission present similarly mind-boggling figures.16
The rapidly increasing value of machine-generated data is attributed to a variety of factors: the
As this article argues, introducing such an all-encompassing property right in data would se-
rise of ‘smart manufacturing’, which involves real-time exchanges of massive amounts of data
riously compromise the system of intellectual property law that currently exists in Europe. It
between machines and robots; the economic potential of ‘mining’ Big Data (i.e. extracting in-
would also contravene fundamental freedoms enshrined in the European Convention on Hu-
formation by way of sophisticated large-scale data analysis);17 and the promise of the Internet
man Rights and the EU Charter, distort freedom of competition and freedom of services in the
, the magical world where machines quasi-independently communicate and exchange
EU, restrict scientific freedoms and generally undercut the promise of big data for European
data directly with other machines, such as the ‘intelligent’ energy meter that sends usage data
economy and society. In sum, it would be a very bad idea.
to the energy company, or the axiomatic refrigerator that automatically orders milk and cof-
fee from the online supermarket. As in Commissioner Oettinger’s op-ed, many of the examples
This article starts (in Section 2) by briefly examining the background and stated aims of the
used in the literature are taken from the automotive sector, where data have become essential
proposed new right: why would there be a need for creating a property right in industrial data?
input and valuable output in manufacturing and navigation.18 The specter of Google’s self-driv-
And what would be its subject matter and scope? Section 3 looks at existing intellectual prop-
ing car potentially out-competing the European car industry is never far away.
erty regimes, inquires to what extent these extend to data, and speculates how a data property
right in data might affect these regimes. Section 4 thereafter scrutinizes the data right from the
Having thus demonstrated that data have tremendous and increasing value, proponents go on
broader perspective of fundamental rights and freedoms. Section 5 concludes.
to point out that current legal regimes, such as traditional civil-law based property right and
existing intellectual property regimes, do not, or do not adequately, protect these data. Admit-
Although creating a property right in data surely has additional ramifications outside these
tedly, non-property regimes such as contracts and trade secret protection might occasionally
fields, in particular for the right of informational privacy (personal data protection), the focus
do the job, as would technical protection measures that create de facto ownership positions.
of this article will be on the law of intellectual property. We will therefore not examine whether
However, these regimes do not create rights
the law of data protection might already imply a property right in personal data.
, so valuable data are at risk of being
9 Nor shall we
misappropriated and a market for using and trading (i.e. licensing) raw data will not develop.19
query whether the civil law concept of private property might be extended – or already extends
Ergo, what is needed is a novel property right that protects industrial data as such. As the
– to (recorded) industrial data, and thus offer alternate protection to data sets.10 We shall also
European Commission tentatively suggests in its Communication, as one of six policy options
avoid discussing other doctrines in potential support of ‘data property’,11 such as criminal law12
presented for “building a European data economy”, “[t]his approach would aim at clarifying the
or trade secret law13, and stay away from the contract and consumer law related issues of ‘trad-
legal situation and giving more choice to the data producer, by opening up the possibility for
ing’ personal data for services, which have become moot in the light of the proposed EU Digital
users to utilise their data and thereby contribute to unlocking machine-generated data”.20
In light of these radical contentions, it is surprising to see how little economic evidence is
Finally, a general caveat is in order. Whereas the European Commission has now posited the
brought forward in support of a property right in data. According to standard economic analy-
issue of ‘data property’ as worthy of serious discussion, the policy arguments advanced in favor
sis, there are two main justifications for the creation of a new IP right: (1) solving the public good
of introducing such a right are underdeveloped, and its contours remain sketchy at best. Criti-
problem by creating an economic incentive for the production of data; and (2) facilitating the
cizing a right of data property is therefore taking aim at a moving target.
use and trade of data. As to the first rationale, Prof. Kerber, a leading German economist, sees
“no evidence that there are generally too few incentives for producing and analyzing data in the
2. Quid data property?
digital economy”21. Indeed, much machine data production occurs (nearly) automatically, often
as a by-product of industrial production or services, and it is hard to see why a legal incentive
The arguments advanced by proponents of introducing a right of ‘data property’ can be roughly
in the form of a data property right would enhance it.22
summarized as follows. First, it is pointed out that industrial data represent enormous economic
As to the second argument, Prof. Kerber observes: “Although it cannot be ruled out that the
value. For example, according to the European Commission, “the value of the EU data economy
market for trading and licensing data can suffer from market failure problems, and empirically
was estimated at EUR 257 billion in 2014, or 1.85% of EU GDP. This increased to EUR 272 billion
data markets are still developing and need more scrutiny, it seems that so far data producers
in 2015, or 1.87% of EU GDP (year-on-year growth of 5.6%). The same estimate predicts that, if
and holders have sufficient possibilities for commercializing their data. The potentially most
important market failure problem that the first buyer might resell data seems to be solvable
through either contractual and technical restrictions or through the strategy of selling services
based upon these data.”23 Prof. Kerber concludes: “there are no convincing economic argu-
15 European Commission, ‘Building A European Data Economy’ (n. 4), 2.
16 OECD (n.1); European Commission, ‘Towards a thriving data-driven economy’, Communication from the Commis-
9 See N. Purtova, Property Rights in Personal Data. A European Perspective
(2012), reviewed by E.J. Dommering,
sion to the European Parliament, the Council, the European Economic and Social Committee and the Committee of
 Maandblad voor Vermogensrecht
the Regions, 2 July 2014, COM(2014) 442 final, 2.
10 See H. Zech, ‘Daten als Wirtschaftsgut – Überlegungen zu einem ,,Recht des Datenerzeugers“‘,  Computer
17 In addition, Big Data analysis may have numerous social benefits; see Federal Trade Commission, Big Data: A Tool
for Inclusion or Exclusion? Understanding the Issues
11 See for a comprehensive overview of possible doctrines M. Dorner, ‘Big Data und ,,Dateneigentum“‘,  Com-
18 See A. Wiebe, ‘Protection of industrial data – a new property right for the digital economy?’,  GRUR Int.
puter und Recht
617-628; Osborne Clarke LLP, Legal study on Ownership and Access to Data
, Study prepared for the
19 H. Zech, ‘Information as a tradable commodity’, in: A. De Franceschi (ed.), European Contract Law and the Digital
European Commission DG Communications Networks, Content & Technology (2016), https://bookshop.europa.eu/
(2016) 51-79; see also M. Dorner, ‘Big Data und ,,Dateneigentum“‘,  Computer und Recht
20 European Commission, ‘Building A European Data Economy’ (n. 4), 13.
12 T. Hoeren, ‘Dateneigentum: Versuch einer Anwendung von § 303 a StGB im Zivilrecht‘,  Multimedia und
21 W. Kerber, ‘A New (Intellectual) Property Right for Non-Personal Data? An Economic Analysis‘,  GRUR Int.
13 See J. Drexl, ‘Designing Competitive Markets for Industrial Data – Between Propertization and Access, Max Planck
22 See P.B. Hugenholtz, ‘Program Schedules, Event Data and Telephone Subscriber Listings under the Database Di-
Institute for Innovation & Competition Research Paper No. 16-13 (2016), 22-24.
rective The ‘Spin-Off’ Doctrine in the Netherlands and elsewhere in Europe’, Paper presented at Fordham University
14 Proposal for a Directive of the European Parliament and of the Council on certain aspects concerning contracts
School of Law Eleventh Annual Conference on International IP Law & Policy New York, 14-25 April 2003, available at
for the supply of digital content, COM (2015) 634 final; see A. Metzger, ‘Dienst gegen Daten: Ein synallagmatischer
Vertrag’, 216 Archiv für die civilistische Praxis
23 Kerber (n. 21), 998. See also Drexl (n. 13).
ments for the introduction of such a new IPR”.24 A more recent, and more elaborate study by
3. Data in the system of intellectual property
the Joint Research Centre of the European Commission is somewhat less skeptical,25 recogniz-
ing that legal uncertainty regarding data ownership rights might negatively affect the efficiency
Before further scrutinizing the proposed data right and its possible impact on the system of in-
of data markets. However, this study too concludes that there are, at present, no compelling
tellectual property law, we first need to examine how existing legal regimes in the EU deal with
economic arguments to advise regulatory intervention.
machine-generated data. This section will focus on relevant laws of intellectual property, and
not discuss other possibly relevant legal mechanisms, such as tangible property, contract and
This article will, however, not further engage in economic analysis of a possible data property
trade secrets. While the focus of this section will be on the two IP regimes most closely associ-
right, but focus instead on its consequences for the existing system of intellectual property. In
ated with protecting data structures, copyright law and sui generis database right, we shall also
order to so, it is important to gain some preliminary understanding of what such a right might
make a brief excursion into the field of neighboring rights.
entail. Drawing from the sketch presented in the Staff Working Paper that underlies the Euro-
pean Commission’s recent Communication,26 which seems to be largely based on the work of
3.1 Copyright in data
Prof. Herbert Zech,27 we assume the features of a data producer’s right
to be roughly as fol-
lows. The right would create a right in rem
(i.e. a property right enforceable against the world)
Is there copyright in data? The textbook answer is a resounding no.
As U.S. Supreme Court
in respect of “non-personal or anonymised machine-generated data”. It would encompass “the
Justice Warren Brandeis famously stated in his dissent in the INS case, “[t]he genera! rule of
exclusive right to utilise certain data, including the right to licence its usage. This would include
law is, that the noblest of human productions - knowledge, truths ascertained, conceptions
a set of rights enforceable against any party independent of contractual relations thus prevent-
and ideas - after voluntary communication to others, are free as the air to common use”.37 This
ing further use of data by third parties who have no right to use the data, including the right to
axiom reflects what is called the idea/expression dichotomy
: the dividing line between, as Eu-
claim damages for unauthorised access to and use of data.”28
ropean copyright scholars prefer to say, protected form and unprotected content(s). The rule
is generally codified in the U.S. Copyright Act (S. 102 (b)), as well in the TRIPs Agreement (art.
Whereas the Commission remains vague on the issue of initial ownership, according to Prof.
9(2)) and the WIPO Copyright Treaty (art. 2). In EU law we find a similar rule, albeit limited to
Zech, the right would initially vest in “the economically responsible operator of equipment that
computer software, in the Computer Programs Directive (art. 1(2)). Although these provisions
generates the data (data producer)”.29 As the European Commission concedes, thus allocating
do not expressly mention ‘data’, it is generally assumed, and uncontroversial – either on the ba-
the right might be highly problematic in practice, since data-generating machines are often
sis of the ‘dichotomy’ or by way of direct application of copyright’s requirement of authorship
owned and operated – and corresponding investments done – by numerous different actors.30
and creativity – that there cannot be copyright in data per se.38
In view of its stated aims, the right would have to be fully transferable.31 As to the term of
Whereas data as such are thus excluded from copyright protection, copyright’s treatment of
protection, the Commission is silent, but according to Prof. Zech “[a] short term of protection
data compilations is more complex. The Berne Convention protects “collections of literary or
seems to be appropriate since using data by analysing them can be done relatively quickly”.32
artistic works such as encyclopaedias and anthologies” (art. 2(5)), but does not mention collec-
The Commission excludes from the scope of the new right personal data, “as the protection
tions of mere data, and expressly denies copyright to “news of the day or to miscellaneous facts
of the latter is a fundamental right in itself under which natural persons should have control of
having the character of mere items of press information” (art. 2(8)). The TRIPs Agreement (art.
their own personal data”.33 Otherwise, the Commission’s proposal seems to encompass all sorts
10(2)) more broadly protects “compilations of data or other material, whether in machine read-
of machine-generated data.
able or other form, which by reason of the selection or arrangement of their contents constitute
As to its precise subject matter, Prof. Zech proposes: “A well-defined subject matter would be
intellectual creations”. The WIPO Copyright Treaty (art. 5) contains similar language. In line
machine-readable coded information that is defined only by its representative characters (bits)
with these modern conventions the EU Database Directive instructs Member States to provide
irrespective of its content (data delimited on the syntactic level).”34 This distinction is reflected
copyright protection to “databases which, by reason of the selection or arrangement of their
in its intended scope. “The scope of protection would in particular include use by carrying out
contents, constitute the author’s own intellectual creation” (art. 3(1)).
statistical analyses, but not the re-creation of the same data by independent measurement.”35
In Football Dataco and others
the Court of Justice clarified that the test of ‘the author’s own
The Commission seems to embrace this distinction, perhaps in the hope that such a limitation
intellectual creation’ (in short, originality) implies that the selection or arrangement of the data
might prevent undue information monopolies.36 We shall examine the distinction between syn-
is the result of creative choices. Applying art. 3(1), 2nd sentence (“No other criteria shall be ap-
tactic and semantic data in the following section.
plied to determine their eligibility for that protection”), the Court held that merely investing
In sum, both in terms of its intended subject matter (data, an immaterial good) and its scope of
significant amounts of skill and labour does not justify a finding of originality. In other words,
protection (reproduction and use of data by third parties), the proposed data producer’s right
the Directive’s originality standard preempts any (quasi-)copyright protection for databases
would probably qualify as a right of intellectual property.
that is merely based on investment or other criteria. 39 The Court’s decision has brought to an
end not only the United Kingdom’s long-standing practice of according copyright protection to
compilations of data based on ‘skill and labour’ (investment), but also similar doctrines in other
24 Kerber (n. 21), 989. See also Dorner (n. 10), 625; Drexl (n. 13), 30 ff., 66.
Member States. For example, the Dutch protection of non-original writings (‘geschriftenbes-
25 European Commission, Joint Research Centre (N. Duch-Brown, B. Martins & F. Mueller-Langer), ‘The economics
cherming’) that existed for over a century in the Netherlands as a vehicle for protecting non-
of ownership, access and trade in digital data’, JRC Digital Economy Working Paper 2017-01.
original writings and compilations, was formally abolished in 2014 following Football Dataco.40
also rules out copyright protection for data compilations that are generated by
26 European Commission, Staff Working Document (n. 4).
27 Zech, ‘Information as a tradable commodity’ (n. 19), 74-76.
machines without any human intervention. This is in line with the general rule that copyright re-
28 European Commission, Staff Working Document (n. 4), 33,
quires acts of human authorship. Note however that the U.K. Copyright, Design and Patents Act
29 Zech, ‘Information as a tradable commodity’ (n. 19), 75.
30 European Commission, Staff Working Document (n. 4), 35.
31 Zech, ‘Information as a tradable commodity’ (n. 19), 76.
37 J. Brandeis, diss. opinion, International News Service v. Associated Press
, 248 U.S. 215 (1918).
38 P.B. Hugenholtz, Auteursrecht op informatie
33 European Commission, Staff Working Document (n. 4), 33. Note that applying this distinction in practice will not
39 Football Association Premier League Ltd and Others
v QC Leisure and Others; and Karen Murphy
v Media Protec-
be easy. For example, much machine data generated by automobiles is related to a person, and will therefore qualify
tion Services Ltd ,
ECJ 4 October 2011, joined cases C-403/08 and C-429/08, ECR  I-9083.
as ‘personal data’; see ADAC Study (n. 5).
40 See P.B. Hugenholtz, ‘Works of Literature, Science and Art’, in: P.B. Hugenholtz, A.A. Quaedvlieg & D.J.G. Viss-
34 Zech, ‘Information as a tradable commodity’ (n. 19), 74.
er (eds.), A Century of Dutch Copyright Law. Auteurswet 1912-2012
(2012) 54. See also P.B. Hugenholtz, ‘Good-
35 Zech, ‘Information as a tradable commodity’ (n. 19), 75.
bye, Geschriftenbescherming!’, Kluwer Copyright Blog, March 6, 2013, available at http://kluwercopyrightblog.
36 European Commission, Staff Working Document (n. 4), 34.
appears to extend copyright protection to machine-created works: “in the case of a literary,
data.48 But where in this spectrum between purely synthetic data and data ‘observed’ should
dramatic, musical or artistic work which is computer-generated, the author shall be taken to be
we place machine-generated data? The answer depends on the type of data that the machine
the person by whom the arrangements necessary for the creation of the work are undertaken”.41
processes. For example, sensor data produced by a radar system or observation satellite are
Whether this rule can co-exist with Football Dataco
remains to be seen. According to the Euro-
likely to qualify as data ‘observed’, and concomitant investments may thus be taken into ac-
pean Court there is no originality “when the setting up of the database is dictated by technical
count when applying the database right. Conversely, computer-generated airline schedule data
considerations, rules or constraints which leave no room for creative freedom”.42
squarely falls under the rubric of ‘created’ data excluded by the European Court.
Both TRIPs and WCT caution that copyright in compilations of data “not extend to the data or
Whereas the sui generis right comes close to a property right in aggregate data – and has been
material itself”. Similarly, the Database Directive (art. 3(2)) warn that database copyright “shall
justly criticized for its potential of creating harmful information monopolies49 – the Directive’s
not extend to their contents”, thus ruling out copyright protection for the data compiled in a
recitals admonish that the sui generis right “does not in any way constitute an extension of
database. The scope of database copyright protection is limited to the original structure (selec-
copyright protection to mere facts or data”(recital 45) and “should not give rise to the creation
tion or arrangement) of the database (Database Directive, recital 15). Extracting (parts of) the
of a new right in the works, data or materials themselves” (recital 46).
contents of the database without appropriating the selection or arrangement does not infringe
Indeed, the database right comes with several statutory limits in order to prevent the right from
the copyright in the database.43
extending to the data in the database per se. The sui generis right protects database producers
3.2 Sui generis database right
against ‘extraction’ and ‘reutilization’ of the whole, or a substantial part, of the database (art. 7).
In other words, non-substantial takings of data are permitted without authorization. Moreover,
Art. 7(1) of the Database Directive supplements the Directive’s copyright regime by obliging
as the European Court clarified in British Horseracing
,50 sui generis protection does not extend
Member States to protect databases that result from substantive – qualitative or quantitative –
beyond misappropriation of data (contents) that result from substantial investment. In other
investment. This is the sui generis database right that has made the Directive internationally (in)
words, the database right tolerates takings of (potentially valuable) data that are not the prod-
famous. The substantial investment is to be made “in either the obtaining, verification or pre-
uct of substantial investment.
sentation of the contents” of the database (art. 7(1)). ‘Obtaining’ is the act of gathering the data,
Another delimiting factor is the notion of ‘database’. Art. 1(2) of the Directive defines this as
works or other materials to be included in the database. ‘Verification’ relates to the checking,
“a collection of independent works, data or other materials arranged in a systematic or me-
correcting and updating of data already existing in the database. ‘Presentation’ concerns acts
thodical way and individually accessible by electronic or other means”. While the Explanatory
such as digitizing (scanning) analogue files, or creating a thesaurus. A decision by the German
Memorandum generally describes the contents of the database as ‘“information” in the widest
Federal Supreme Court suggests that the standard of ‘substantial investment’ is not very hard
sense of that term’,51 the compiled data or materials must be ‘independent’, that is to say, “ma-
to meet. Any investment in a database that “viewed objectively […] is not wholly insignificant
terials which are separable from one another without their informative, literary, artistic, musical
and easy to be made by anyone” would suffice.44 The European Court of Justice has yet to
or other value being affected”.52 Therefore an audiovisual, cinematographic, literary or musi-
opine on the level of this threshold criterion.
cal work or a sound recording does not qualify as a database, even if it can be perceived as a
In four landmark cases concerning the unauthorized use by betting companies of sports events
representation of data (recital 17). This reflects a clear intention on the part of the European
schedules (‘fixtures’) the European Court held that database right does not protect investment
legislature to avoid extensive overlaps between the database right and existing copyright and
in generating the data or other contents of a database. According to the Court, “investment in
the obtaining of the contents” (of a database) “refers to the resources used to seek out exist-
Finally, according to art. 1(2) of the Database Directive, the individual elements of the database
ing materials and collect them in the database but does not cover the resources used for the
must be “arranged in a systematic or methodical way”. This squarely rules out protection –
creation of materials which make up the contents of a database.” 45 The main argument for this
whether by copyright or by database right – of (collections of) raw machine-generated data.
distinction, as is transparent from the decision, is that the Database Directive’s economic ratio-
nale is to promote and reward investment in database production, not in generating new data.
3.3 Phonogram protection
According to the Court, “[t]he purpose of the protection by the sui generis right provided for
by the directive is to promote the establishment of storage and processing systems for exist-
In addition to copyright and database right, the phonographic right – one of the four neigh-
ing information and not the creation of materials capable of being collected subsequently in a
bouring rights recognized at EU level – merits brief consideration. The rights of phonogram
producers are harmonized by the Rental Right Directive (currently Directive 2006/115/EC) and
the Information Society Directive (Directive 2001/29/EC). These Directives leave defining the
Thus investment in ‘creating’ data does not count towards investment. However, the European
notion of ‘phonogram’ to the WIPO Performances and Phonograms Treaty (WPPT) of 1996. Ac-
Court’s epistemological distinction between ‘creating’ and ‘obtaining’ data is not self-evident.47
cording to the WPPT (art. 2) ‘phonogram’ means “the fixation of the sounds of a performance
While the Court ruled out from sui generis protection such ‘invented’ data as horse racing
or of other sounds, or of a representation of sounds, other than in the form of a fixation incor-
schedules and football fixtures, the Court of Appeal of England and Wales in a subsequent
decision held that facts observed – such as the scoring of a goal in football – are not ‘created’
41 Copyright, Design and Patents Act, U.K. 1988 (c. 48), c. 1, s. 9(3); see M. Perry and T. Margoni, ‘From Music Tracks
to Google Maps: Who Owns Computer-generated Works?’, 26 Computer Law & Security Review
48 Football Dataco & Others v Stan James Plc & Others and Sportradar GmbH & Others, Court of Appeal (Civ. Divi-
42 Football Dataco and others (n. 39).
sion), 6 February 2013, EWCA Civ 27.
43 The Newspaper Licensing Agency & others v Meltwater & the PRCA
, High Court of Justice (Chancery Division), 26
49 See J. H. Reichman, ‘Database Protection in a Global Economy’,  Revue Internationale de Droit Economique
 EWHC 3099.
44 Bundesgerichtshof (Federal Supreme Court), 1 December 2010, case I ZR 196/08.
50 British Horseracing (n. 45).
45 Fixtures Marketing Ltd v Oy Veikkaus Ab, ECJ 9 November 2004, case C-46/02, ECR  I-10396; British
51 Explanatory Memorandum, Proposal for a Council Directive on the Legal Protection of Databases, 19.
Horseracing Board v William Hill Organization, ECJ 9 November 2004, case C-203/02, ECR  I-10415; Fixtures
52 Fixtures Marketing Ltd v. Organismos prognostikon agonon podosfairou AE (OPAP)(n. 45).
Marketing Ltd v Svenska Spel AB, ECJ 9 November 2004, case C-338/02, ECR  I-10497; Fixtures Market-
53 On the other hand, the European Court has held that the geographical data in topographic map are sufficiently
ing Ltd v Organismos prognostikon agonon podosfairou AE (OPAP), ECJ 9 November 2004, case C-444/02, ECR
‘ ‘independent’ to for the map to qualify as a protected ‘database’. According to the Court, “ geographical informa-
tion extracted from a topographic map by a third party so that that information may be used to produce and market
46 British Horseracing (n. 45), para. 31.
another map retains, following its extraction, sufficient informative value to be classified as ‘independent materials’
47 M.J. Davison & P.B. Hugenholtz, ‘Football fixtures, horseraces and spin-offs: the ECJ domesticates the database
of a ‘database’ within the meaning of that provision.” Freistaat Bayern v Verlag Esterbauer GmbH, CJEU 29 October
right’,  European Intellectual Property Review 113-118.
2015, Case C-490/14.
porated in a cinematographic or other audiovisual work”. By including ‘other sounds’ and ‘a rep-
Another consequence of this wide-ranging overlap would be that statutory limitations and ex-
resentation of sounds’ this definition apparently encompasses raw audio data stored (‘fixed’)
ceptions under copyright, neighbouring rights or database right are ‘trumped’ by data pro-
on a digital medium.
ducer’s right. For example, both copyright and database right in the EU presently allow users to
Whether there is a threshold criterion for the phonographic right that might delimit both the
copy or extract data from databases for non-commercial research purposes. Unless, the ‘data
substance and scope of the right, is as yet unsettled under EU law. In its 2008 Metall auf Metall
producer’s right’ would replicate all relevant existing exceptions, it would undercut these es-
decision the German Bundesgerichtshof extended neighbouring rights protection to every sin-
sential user freedoms.
gle recorded note of a sound recording, because the record producer’s investment is reflected
This is especially true for data mining
. Strangely, while the Commission’s Communication on
in every – even very minor – part of the recording.54 This suggests that no threshold criterion
‘Building a European data economy’ ponders the introduction of an exclusive right in machine-
(no investment minimum) would apply. In a follow-up decision the German Constitutional Court
generated data, one of the highlights of the DSM Directive proposal that is currently being
has however held that a phonographic right of unlimited scope, as contemplated by the Fed-
debated in the European Parliament is a mandatory exception, both under copyright and data-
eral Supreme Court, may collide with the ‘freedom of art’ that is constitutionally guaranteed in
base right, for text and data mining by non-commercial research organisations.56
Germany (art. 5 of the Basic Act). Most recently, the Bundesgerichtshof has referred questions
In line with Prof. Zech’s suggestions, the European Commission in its Staff Working Paper at-
regarding the scope and limitations of the phonographic right to the EU Court of Justice.55
tempts to alleviate concerns of wholesale overlap by distinguishing syntactic
3.4 Assessment: impact of data property on the system of intellectual property law
data. The proposed ‘data producer’s right’ would be conceived in such a way that “only the
syntactical level of information is protected, not the semantic level”57 What is probably meant
As this section shows, both copyright and database right do not extend to data per se. Both
here is that the raw data would be protected only as regards its digital representation (the
regimes do conditionally offer protection to data compilations that result from creative selec-
machine-readable bits and bytes, the ‘ones and zeros’ in the digital file), not the informational
tion and arrangement (copyright) or substantive investment (database right). Both regimes
content that these data convey. Thus, the European Commission hopes, the new right would
deny protection to machine-generated, raw data. For copyright, this follows from the axiom
not extend to ideas and information, and the new right would not become a “super-IP right”.58
that only acts of authorship conducted by human beings are protectable. For database right,
But would such a distinction really prevent the new right from extensively overlapping with ex-
this is a consequence of the sui generis right’s categorical delimitation: only data structured in
isting IP rights? I do not believe so. The problem here is that digital data are commonly coded
a ‘database’ qualify for protection. Moreover, the sui generis right’s substantial investment test
and interpreted following standardized rules and protocols. In other words, there usually will be
sets an – admittedly fairly low – minimum threshold. If operating a machine that records sensor
a one-on-one relationship between the (syntactic) data substrate and the (semantic) content
data does not require substantial investment (for example, a low-cost digital weather station
layer. Returning to our example of the digitally produced film, any copy of the film’s digital file
or a bicycle computer),then this will not result in a protected database. The CJEU’s ‘Fixtures’
(the syntactic data) would by necessity also reproduce the copyright protected work (the se-
decisions pose an additional hurdle to sui generis protection for machine-generated data by
mantic layer). Thus, the new data right could be invoked against any digital copying (or stream-
excluding ‘created’ data from protection, thus ruling out machine-generated synthetic data.
ing) of the digitized copyright work. For the same reason, the new right would broadly overlap
In sum, introducing a right in raw, machine-generated industrial data, as envisaged in the Com-
with database right, even if its scope were confined to the syntactic layer. The phonographic
mission’s Communication, would go far beyond the main intellectual property regimes pres-
right discussed above illustrates this point. Whereas its subject matter, like the proposed ‘data
ently existing in Europe in the field of data and information, copyright and database right.
producer’s right’, is limited to the recorded signal (i.e. syntactic audio data), its scope extends
into the semantic realm. Reproducing a cd recording of a musical performance will, by neces-
sity, result in the reproduction of the underlying musical work and performance.
How would this affect existing intellectual property law? In the first place, creating a new layer
The only way to prevent the data right from becoming an all-encompassing ‘super-IP right’
of rights in machine-generated data would cause broad and disruptive overlaps with copyright
would be to categorically exclude all data that (possibly) represent subject matter protected
and sui generis right in productions made with the aid of digital machines. For example, a film
under traditional IP regimes: not just copyright, database right and neighbouring rights, but also
shot with a digital camera would qualify not only as a work protected by copyright, but also as
design right and perhaps even patents. But even a non-overlapping data right would have seri-
machine-generated (sensor) data subject to a ‘data producer’s right’. Similarly, the aggregate
ously corrosive effects on the system of intellectual property, for various reasons. First, it would
stock market data in a financial database would be protected both by sui generis right and
undermine the economic incentives that underlie IP rights. For example, the main rationale of
‘data producer’s right’, since the data are recorded automatically by the computerized stock
the sui generis right is to promote and reward investment in the building of databases from pre-
existing data and other materials. This incentive is clearly undercut if a lower-tier, no-threshold
right in machine-generated data were to exist in parallel. Second, and more importantly, it
Whereas the EU legislature has clearly intended to prevent the database right from spilling over
would compromise the general principle of intellectual property – whether utilitarian or ground-
into the realms of copyright and neighbouring rights, the ‘data producer’s right’ would lead
ed in natural law theory – that protection be reserved to creation, innovation or otherwise meri-
to extensive overlaps. As a consequence, the new right might give rise to multiple competing
torious investment. A data right in all data produced by machines might, on occasion, protect
claims of ownership in the same content. To continue with our first example, while the creators
assets of considerably economic value, but nothing of merit. This has ramifications, in particular,
of the film (e.g. the director, screen writer, and other creators of the film) could claim authorship
at the political level. With intellectual property laws under increasing fire, legislatures – at EU
in the cinematographic work, the owner or operator of the camera might claim ‘data property’
and national level – need powerful and convincing arguments to defend existing regimes and
in the photographic data (i.e. the digital representation of the film) – surely, to the unpleasant
introduce new rights. In this volatile political climate proposing a data producer’s right with the
surprise of the film’s producer. Similar examples might be given with regard to digital photo-
graphs or e-books. In the second example, the database producer might be confronted with
‘data property’ claims of the stock exchange, or the exchange’s computational services com-
56 European Commission, Proposal for a Directive of the European Parliament and of the Council on Copyright in
the Digital Single Market, Brussels, 14 September 2016, COM(2016) 593 final. Art. 3(1) of the proposed Directive pro-
vides: “Member States shall provide for an exception to the rights provided for in Article 2 of Directive 2001/29/EC,
Articles 5(a) and 7(1) of Directive 96/9/EC and Article 11(1) of this Directive for reproductions and extractions made
by research organisations in order to carry out text and data mining of works or other subject-matter to which they
have lawful access for the purposes of scientific research.”
54 Metall auf Metall, Federal Supreme Court, 20 November 2008, case I ZR 112/06, GRUR
2009, 403; German Con-
57 Zech, ‘Information as a tradable commodity’ (n. 19), 74; European Commission, Staff Working Document (n. 4),
stitutional Court, 31 May 2016, case 1 BvR 1585/13 of, GRUR
55 Metall auf Metall III, Federal Supreme Court, 1 June 2017, case I ZR 115/16.
58 European Commission, Staff Working Document (n. 4), 34.
sole aim of (better) protecting the economic assets of the automotive (or any other) industry
extends to commercial
speech has been a matter of some controversy. However, the European
will surely backfire. Not only is such an initiative likely to fail in the legislative process, but it will
Court of Human Rights has made it clear that information of a commercial nature is indeed pro-
also (re)ignite broader discussions on the legitimacy of intellectual property law.
tected, albeit to a lesser degree than political speech.62
No legal certainty
Article 10 ECHR prevents states from creating restrictions to the free flow of information unless
such restrictions “are prescribed by law and are necessary in a democratic society [...] for the
Another, more mundane objection against a property right in data lies in its inherent lack of
protection of the [...] rights of others”. From this perspective data and information must flow
legal certainty. Although it is still not fully conceptualized, it is difficult to imagine a data right
freely, uninhibited by property rights or other state-created restrictions, unless a compelling
sufficiently stable in terms of subject matter, scope and ownership to be admitted to the ranks
societal need for protection (“necessary in a democratic society”) can be established. Freedom
of intellectual property. As to subject matter, if the right vests in data generated by machine
of expression and information, in other words, makes intellectual property rights in data the
processes, which data would it protect? All the data that the machine produces within a given
exception to the default rule of freedom.63
time frame (e.g. an hour, a minute or a second)? Or all the data that result from a finite machine
This brings us back to the question of expediency. The EU legislature would bear the burden
process (e.g. all the data gathered by a satellite that sensors the earth)?
of proving that a property right in machine-generated data is a socially and economically jus-
Admittedly, the sui generis database right has already raised similar questions. With data in a
tifiable (‘necessary’) interference in the freedom of European citizens and companies to freely
database constantly being updated, what exactly constitutes the protected database? But in
access and reutilize machine-generated data. In light of the abundant praise in political litera-
database law the definition of ‘database’ and requirement of substantial investment create at
ture of ‘big data’64 and big data mining as drivers of progress and prosperity, and the absence
least some measure of permanency in the subject matter and scope of the right. This stability is,
of convincing evidence supporting a property right in machine-generated data, this burden of
however, completely absent from the data producer’s right. The problem here is that industrial
proof would be difficult to surmount.
data generation mostly occurs in real time. The ‘velocity’ – the dynamic nature – of big data
In particular, freedom of expression and information militates strongly against any new right
makes it very difficult, if not impossible, to identify a stable object of protection.59 The subject
of intellectual property that would restrict scientists’ access to data – a freedom that the EU
matter of the right is simply too fluid. If this is to become a full-fledged right of intellectual prop-
legislature expressly wishes to preserve as regards ‘text and data mining’ by non-commercial
erty that is enforceable against the world, it should be possible to ascertain its subject matter
research institutions. Note that this freedom finds additional support in art. 13 of the EU Charter
– and, by implication, its scope of protection – with sufficient legal certainty.
(“The arts and scientific research shall be free of constraint. Academic freedom shall be re-
A related problem is allocating ownership of the right. Since the right would be sparked by
spected”). Another area where a data right would patently conflict with freedom of expression
machine operations, no causal ownership connection with a natural person as, for instance, in
and information is journalism, where mining data has become an essential tool for investigative
copyright, exists. As Prof. Zech and the European Commission suggest, ownership might be
vested in the person owning or operating the machine that generates the data. This, however, is
A second over-arching policy consideration underlying intellectual property law’s reluctance
hardly a reliable rule. As the OECD points out in its groundbreaking study on ‘big data’, multiple
to protect data per se is freedom of competition (enshrined in art. 16 of the EU Charter as the
actors/stakeholders might claim ownership to the data, both upstream and downstream in the
“freedom to conduct a business”). This economic freedom traditionally sets limit to intellectual
process of generating and processing data.60
property rights and is one of the rationales underlying the idea/expression dichotomy. As the
In sum, the proposed ‘data producer’s right’ would most likely seriously affect, or even distort,
literature on the economic potential of ‘big data’ demonstrates, machine-generated data are
existing copyright and database right, and its underlying incentives. Moreover, in the absence
both input and output to innovative manufacturing processes and value-added services, and
of clear and predictable rules circumscribing its subject matter, scope and ownership, it would
thus a major driver of economic growth. This calls for measures promoting access to data and
lead to gross legal uncertainty. This conclusion in itself justifies serious restraint on the part of
fostering data mining rather than commodification of data by creating property rights in data.
the EU legislature, even without considering the adverse effect the new right might have on the
Unless equipped with wide-ranging exceptions and safety valves, introducing a new property
free flow of information, one of the cornerstones of the emerging information society.
right in data might create undesirable data monopolies that could impede, rather than foster,
competition in this rapidly evolving European ‘data market’ place’.66 At the global level, intro-
4. Data property and the free flow of information
ducing data property rights in the EU might well lead to anti-competitive distortions as well,
in cases where European data users are obliged to purchase licenses for usage of data freely
The exclusion of data per se from the scope of existing intellectual property regimes is not
available to their competitors in the United States.
merely ontological. Although old-school author’s right scholars might argue that data are not
copyright works, because
data are not ‘created’, this is at best a partial explanation for this ex-
clusion.61 Rather, IP law’s abhorrence of protecting data reflects implicit or explicit information
policies not to protect data. These policies are, in turn, informed by a variety of public interest
values and concerns. In the first place, of course, freedom of expression and information – the
fundamental freedom enshrined in the European Convention on Human Rights (art. 10 ECHR),
and the EU Charter (art. 11).
62 See e.g. Hertel v. Switzerland,
ECHR 25 August 1998, Publications of the ECHR, Reports 1998-VI.
63 See (for copyright) Ashby Donald and Others v France, European Court of Human Rights 10 January 2013, No.
As case law and doctrine regarding the Convention teach, this fundamental freedom is to be
36769/08; ECLI: 2013:0110JUD00367690.
interpreted broadly. Article 10 ECHR is phrased in media-neutral terms and thus applies to old
64 OECD (n. 1); see also European Commission, ‘A Digital Single Market Strategy for Europe’, Communication from
and new media alike. The term ‘information’ (in French: ‘informations’) comprises, at the very
the Commission to the European Parliament, The Council, The European Economic and Social Committee and the
least, the communication of facts, news, knowledge and scientific information. It also, undoubt-
Committee of the Regions, 6 May 2015, COM (2015) 192 final, p. 14: “Big data, cloud services and the Internet of
edly, extends to syntactic data; the scope of article 10 is not limited to (semantic) speech, but
Things are central to the EU’s competitiveness.” I. Hargreaves a.o., Standardisation in the area of innovation and
technological development, notably in the field of Text and Data Mining
. Report from the Expert Group to the Euro-
extends to the means used for communication purposes. To what extent the article’s protection
pean Commission (2014), doi:10.2777/71122.
65 See Dammann v. Switzerland, ECHR 25 April 2006, no. 77551/01. The Court opines that “the gathering of informa-
tion was an essential preparatory step in journalism and an inherent, protected part of press freedom”. Surprisingly,
data mining for journalistic purposes seems to be overlooked in the proposed TDM exception of the DSM Directive.
59 Drexl (n. 13), 15.
66 Max Planck Institute for Innovation and Competition, ‘Data Ownership and Access to Data’, Position Statement of
60 See OECD (n.1), 195-196; Drexl (n. 13), 6, 39.
the Max Planck Institute for Innovation and Competition, Max Planck Institute for Innovation & Competition Research
61 See generally P.B. Hugenholtz, Auteursrecht op informatie
[Copyright in information] (1989).
Paper No. 16-10 (2016), 2.
Finally, a novel data right would also create new barriers to the freedom of services, one of the
juxtaposes the legal situation in the EU with that in the United States, where since the Supreme
four freedoms of the EU Internal Market. In its Communication on ‘Building A European Data
Court’s landmark Feist
decision73 no legal protection for ‘sweat of the brow’ based databases
Economy’, the European Commission interprets this freedom, together with the freedom of es-
exists. Nevertheless, as the Commission wryly observes, “there has been a considerable growth
tablishment, as implying a “principle of free movement of data within the EU”.67 It is hard to see
in database production in the US, whereas, in the EU, the introduction of ‘sui generis’ protection
how a novel property right in machine-generated data would square with this freedom.
appears to have had the opposite effect.”74
The 2005 evaluation report concludes by offering four possible ways forward: (1) repeal the
whole Directive; (2) withdraw the sui generis right, (3) amend the sui generis to clarify its scope,
This article makes the case against introducing a data property right. As we have seen, there are
and (4) maintain the status quo. Despite these harsh conclusions, the database right has yet to
abundant reasons to reject this idea. A ‘data producer’s right’ in machine-generated data would
be amended or repealed. The problem is that removing (parts of) a directive is, politically and
ride roughshod over the existing system of intellectual property. It would violate one of the IP
legislatively, even more complex than substantive harmonization. Repealing the database right
system’s main maxims that data per se are “free as the air for common use”, and that only cre-
would require a new directive not only rescinding major parts of the existing Directive, but also
ative, innovative or other meritorious investment is protected. It would corrode IP’s mechanism
– absurdly – instructing Member States to abolish
sui generis database protection. Unsurpris-
of incentives by creating an underlayer of rights that automatically protects all data produced
ingly, the only option that has so far materialized from the Commission’s assessment is no. 4:
with the aid of machines. This parallel layer of rights would, most likely, extensively overlap with
other IP regimes, and thus create undue impediments for the exploitation of existing rights,
The lessons of the EU’s database experiment76 are not to be forgotten. Introducing a novel
such as copyright and database right, and endanger user freedoms guaranteed under these
right of intellectual property should never be done in the spur of the moment. Any new right
regimes. It would also give rise to gross legal uncertainty, since the ‘velocity’ of real-time data
should be contemplated only after conducting thorough economic, evidence-based research
generation makes it difficult, or even impossible, to circumscribe its subject matter, scope of
that demonstrates a real need for the right and predicts its consequences for information mar-
protection and ownership. More generally, a property right in machine-generated data would
kets and society at large. Assuming a convincing case in support of the right might indeed be
contravene freedom of expression and information, and pose new obstacles to freedom of
made, this should then be followed by systematic legal analysis of the new right’s contours and
competition, freedom of services and the ‘free flow of data’.
scope, and of its impact on the existing system of intellectual property. The two-tiered struc-
The great promise of big data – for the economy, for science, for society at large – is that this
ture of the Union does not allow for legal experimentation at the EU level. Like the database
resource may be freely exploited. Introducing a ‘data right’ preventing unauthorized access to
right, a ‘data producer’s right’ would be here to stay – a most unwelcome guest in the house of
big data would directly contradict this. Indeed, it is hard to understand how the proposed new
European intellectual property.
right would square with the text and data mining proposed by the European legislature in the
current EU copyright reform package.
If, as the European Commission rightly believes, “big data, cloud services and the Internet of
Things are central to the EU’s competitiveness”68, one would have expected supporters of a
novel data producer’s right to present powerful and convincing arguments in support of this
revolutionary proposition. So far, the case for a property right in machine-generated data has
yet to be made. As Prof. Drexl and others have pointed out, the existing toolkit of trade secret
protection, contract and technological protection measures offers data producers ample means
of securing de jure or de facto exclusivity.69 Rather than wasting time and effort on inventing a
data producer’s right, the focus of the European Commission’s possible interventions should be
on fostering access to big data.70
Fortunately, the possible introduction of a ‘data producer’s right’ is only one of several policy
options currently being contemplated by the Commission in its ‘European Data Economy’ initia-
tive. As this article has shown, there are innumerable reasons for the European Commission not
to go down this road. If nothing else, Europe’s experience with the sui generis database right
should give reason for extreme caution. In 2005, less than ten years after it was introduced at
EU level, the European Commission published its first review of the Database Directive, a re-
markably self-critical assessment. According to the Commission, “[t]he economic impact of the
“sui generis” right on database production is unproven. Introduced to stimulate the production
of databases in Europe, the new instrument has had no proven impact on the production of
databases”.71 The Commission’s report also suggests that the sui generis right has not helped
the European industry to overcome its productivity gap vis-à-vis the United States.72 It points
to several other deficiencies of the sui generis right, such as its uncertain contours, and its prox-
imity to a property right in data that might negatively affect innovation and growth. The report
67 European Commission, ‘Building A European Data Economy’ (n. 4), 7.
68 DSM Strategy, p. 14.
69 Drexl (n. 13), 66.
73 Feist Publications, Inc., v. Rural Telephone Service Co., 499 U.S. 340 (1991).
70 See Drexl (n. 13), 41 ff; Max Planck Institute Position Statement (n. 66); see also European Commission, Staff Work-
74 European Commission, ‘First evaluation of Directive 96/9/EC on the legal protection of databases’, DG Internal
ing Document (n. 4), 36 ff.
Market and Services Working Paper, Brussels, 12 December 2005, p. 24.
71 European Commission, ‘First evaluation of Directive 96/9/EC on the legal protection of databases’, DG Internal
75 Note that the European Commission has launched a public consultation on a possible review of the Database
Market and Services Working Paper, Brussels, 12 December 2005, p. 5.
Directive on 24 May 2017, see https://ec.europa.eu/digital-single-market/en/news/commission-launches-public-
72 European Commission, ‘First evaluation of Directive 96/9/EC on the legal protection of databases’, DG Internal
Market and Services Working Paper, Brussels, 12 December 2005, p. 22-23.
76 S.M. Maurer, P.B. Hugenholtz & H.J.Onsrud, ‘Europe’s database experiment’, 294 Science 789-790.
The Greens I EFA
in the European Parliament