Media brief: June 2011
Welcome to the June 2011 edition of Media Brief, the bi-monthly, media-related newsletter from Fieldfisher. We hope you enjoy it. Please feel free to contact us if you would like to discuss in greater detail any of the issues raised, or indeed any other issues.
In this issue:
Intellectual property reviews released in England (Hargreaves report) and by the European Commission
Two important reviews of the intellectual property rights regime in England and Europe have been released within less than a week of each other. Firstly Professor Hargreaves, Chair of Digital Economy at the University of Cardiff, published a report on 18 May 2011 which recommended wholesale changes in the strategic direction of IP policy in the UK. This was followed by the European Commission’s Report on a Single Market for Intellectual Property Rights, which came out on 24 May 2011.
Both reports make numerous recommendations with respect to IP policy generally, all of which aim to encourage creativity and innovation in the digital era. Important proposals in the reports include the introduction of a new collection agency which will act as a "one-stop clearance shop" for clearing use of copyright protected works, steps to address "orphan works" and changes to the customs regime.
First ruling under the new procedure in the Copyright Tribunal
The Copyright Tribunal has made its first ruling under the new small applications track with its streamlined procedure. The dispute was decided only on the papers and there was no hearing. The case, Archive Media Publishing Ltd v MCPS, involved an allegation by Archive Media, a DVD manufacturer, that the Mechanical-Copyright Protection Society (MCPS) had been discriminatory by refusing to offer it a copyright licence on terms other than pay-as-you-go which required it to pay monthly instalments by direct debit, when its main competitors were offered a licence without these terms. The Copyright Tribunal dismissed this application, ruling that MCPS was entitled to treat licensees which were small companies or of lesser financial standing differently from other licensees, provided they did so in a reasonable manner. Applying this test the Copyright Tribunal held that MCPS could require pay-as-you-go terms from Archive Media. The Tribunal did, however, comment that the MCPS should publish a clear statement on the terms of the pay-as-you-go licence. The MCPS is now applying for its costs.
BT and TalkTalk’s judicial review action against provisions in the Digital Economy Act 2010 largely fails
The High Court has ruled in a judicial review action brought by BT and TalkTalk that "initial obligation" provisions in the Digital Economy Act 2010 ("DEA") aimed at reducing online copyright infringement are lawful. In particular, BT and TalkTalk sought to attack the provisions requiring ISPs to send out warning letters to users who are alleged to have taken part in illegal file-sharing and to provide copyright owners with lists of repeat offenders on request. They relied on several grounds of attack, including that the legislation had not been properly notified to the European Commission; it was in breach of EU legislation on privacy and ISPs’ liabilities for users’ behaviour under the E-Commerce Directive; and was not proportionate. The High Court threw out all these objections and ruled that the initial obligations provisions in the DEA are lawful. The Court did, however, uphold their attack on a draft Order for covering costs of carrying out the initial obligations which provides for the 75:25 sharing of the costs between copyright owners and ISPs, ruling that those charges were unlawful against ISPs under the Authorisation Directive. It has been reported that TalkTalk is considering an appeal.
Advocate General advises that ISP should not have to filter out traffic which infringes copyright
The ECJ Advocate General, Cruz Villalon, has given his opinion in relation to a preliminary ruling sought by Belgian ISP Scarlet Extended SA in response to a 2007 Belgian court order in favour of the Société belge des auteurs compositeurs et éditeurs (“SABAM”), requiring Scarlet to monitor, filter and block peer-to-peer file sharing communications which are in breach of the intellectual property rights of SABAM’s members.
The Advocate General’s opinion proposes that the ECJ should declare that EU law precludes a national court from making such an order. To comply with the court’s judgement Scarlet would be required to monitor and filter all content passed between users and carry out pre-emptive strikes against content likely to infringe IP rights. This jeopardises the right to respect for the privacy of communications and the right to protection of personal data, both being protected under the EU’s Charter of Fundamental Rights. A restriction on the rights and freedoms of internet users should be permissible only if it were adopted on a national legal basis which is accessible, clear and predictable.
Publication of new guidelines for product placement for UK TV programmes
Ofcom has recently published a guide setting standards in respect of product placement (as it was required to do under The Audiovisual Media Services (Product Placement) Regulations 2010). This guide sets out the principles of what is, and is not, acceptable, the types of product placement which are not permitted, and a contact list of individuals within broadcasters who deal with product placement.
Please click here to read Q&As about the new product placement rules for UK TV programmes and what this means for retailers, which were featured in Retail Week on 15 April 2011 and written by David Bond, the Head of the Advertising & Marketing Group in Fieldfisher.
IPO publishes its response to the European Commission’s consultation on the Resale Right Directive
In 2006, the Artist’s Resale Right Directive (ARR) was introduced in the UK via statutory instrument which gave living artists the right to royalties from the resale of their work. By virtue of the derogation in the dealers were exempt from applying these regulations to the works of deceased artists. Between 7 January and 11 March 2011, the European Commission (EC) led a consultation on the ARR to help prepare a report on its implementation and effect. The Intellectual Property Office (IPO) has published a response to the EC’s consultation, detailing the effect of ARR on the art market in the U.K. Much of the response reflects the findings of the Szymanski Report, published by the IPO in January 2008, and draws on the information given to the IPO by artists, dealers, major auction houses and collecting societies.
Of the 123 artists surveyed by the Szymanski Report 84% believe the ARR’s introduction was beneficial. Since 2006, the Design and Artists Collecting Society (DACS) and the Art Collecting Society (ACS) have collected £12m for 2000 living artists, and also consider the ARR has cultural benefits, incentivising artists and granting a valuable stream of revenue at certain points in an artist’s career. Dealers however reflect negatively upon the regulations, with a majority believing the rules have adversely affected London’s share of the global art market, and 42% considering that their business personally has been adversely affected. When the ARR is extended to deceased artists on 2 January 2012, there is concern that the UK and European markets will lose competitiveness in comparison to the US and growing Chinese markets.