The outlook for copyright and related areas in 2016
To a certain extent, tangible legal developments in copyright law in the EU and UK were put on hold in 2015 as we first waited for the launch of the Digital Single Market (DSM) Strategy and then watched the initial wave of consultations come out.
The UK has been understandably reluctant to rock the boat with the EC planning such a wholesale revision of regulation. The government recently announced, for example, that it would hold off legislating on the private copying exemption (declared illegal earlier this year) pending further developments in Europe. This means, both that the legislative agenda is fairly clearly set out for 2016 (even if the timetable is ambitious to say the least), and that almost everything is up in the air.
The Digital Single Market
The biggest legislative developments of 2016 in the fields of copyright and related areas of law are likely to centre around the DSM Strategy, announced in a Communication from the European Commission on 6 May 2015. The Communication set out various actions to be taken to achieve the Commission's vision of a European DSM, which would aim for better online access for consumers and businesses across Europe, creation of the right conditions and a level playing field for advanced digital networks and innovative services and maximise the growth potential of the digital economy. You can read more on the proposals here.
Several consultations on the DSM Strategy have taken place this year and are ongoing, including on cross-border contract rules, the Audiovisual Media Services Directive, the Satellite and Cable Directive, geo-blocking and online platforms. The European Council also recently backed the Commission's proposals to reform European trade mark law through a Directive which is intended to "approximate" different national trade mark laws and a Regulation to update rules on Community Trade Marks.
It was recently reported that an unspecified publication on the DSM would be made by the Commission on 9 December 2015. However, a draft Communication was leaked on 10 November, which detailed an initial focus in the coming year on "portability" of online content services to enable users who have subscribed to or acquired content in their home country to access it in other Member States. According to the draft Communication, the Commission will also consider legislative proposals for adoption in the spring aimed at enhancing cross-border distribution of television and radio programmes online, possibly through a review of the Satellite and Cable Directive, and supporting negotiation of cross-border content access. A consultation on geo-blocking is currently ongoing, closing on 28 December 2015.
The leaked draft Communication further states that, in order to provide enhanced access to knowledge, education and research, it will consider legislative proposals on other EU exceptions to increase harmonisation between and across the borders of Member States. The Commission will also consider measures in respect of the sharing of the value created by new forms of online distribution of copyright-protected works, in particular, addressing the unintended "value gap" which needs to be closed. The term "value gap" refers to the disparity between money generated by music sharing platforms and royalties paid to artists. Closing the "value gap" is intended to ensure fair remuneration for artists, thereby contributing to economic growth, competitiveness and the full development of the DSM. This should be achieved by clarifying that those who distribute or intervene in distribution are active and responsible for obtaining licences, so are not neutral carriers who can benefit from the so-called "safe harbour".
The Commission will also consider a review of the definitions of the "communication to the public" and "making available" rights. For example, the recently closed consultation on the Satellite and Cable Directive focused on whether the Directive’s country of origin copyright regime for determining where a communication to the public by satellite takes place should be extended to certain online transmissions. There has been suggestion that this may prove necessary, at least in part, in order to effectively implement the Commission’s portability proposals.
By autumn 2016, the Commission will also look at the rules for identifying infringers and remedies available for infringement, as well as carrying out a full consultation on online platforms, intended to cover the use and effectiveness of "notice and action" mechanisms.
The effect of any changes under the DSM Strategy will be better understood once the ongoing consultations are complete and the draft legislation published. We expect concrete legislative proposals for implementation of the legislation proposed under the DSM Strategy to be revealed in 2016. A key aim of the DSM Strategy is to establish a supportive investment climate for digital networks, research and innovative business and to make the EU an even more attractive location for global companies. However, the proposals set out will require significant investment and development before the EU's digital ambitions can be realised.
Various new licensing models will need to be considered and there will be a focus on how existing territorial rights will tie in with mandatory portability. The different cultural and economic interests of the various Member States are likely to create challenges to the implementation of the exceptions and limitations contained within the portability framework.
Further, the changes under review to which entities in an online distribution chain will be considered active participants, rather than simply "neutral carriers" or "hosts", will have the potential to affect those in the chain who currently rely on "safe harbour" provisions.
Developments in copyright and trade mark case law
The decision in Cartier International AG and others v British Sky Broadcasting Ltd and others, which saw the English High Court extend website-blocking orders to cover websites that infringe trade marks, will go before the Court of Appeal in April.
Following on from the 2014 IPEC decision in Henderson v All Around The World Recordings Ltd and the 2015 decision in Absolute Lofts South West London Limited v Artisan Home Improvements Limited, we would hope to see further clarity on remedies under the Enforcement Directive, which obliges EU Member States to provide for the effective, proportionate and dissuasive measures, procedures and remedies necessary to ensure the enforcement of IP rights.
A test in the courts of the quotation and caricature, parody and pastiche copyright exceptions, introduced into the Copyright Designs and Patents Act by the Copyright and Rights in Performances (Quotation and Parody) Regulations 2014, would be welcomed in the coming year. Thus far, the only guidance on the parody exception has come from the CJEU, in a preliminary ruling on a referral from a Belgian court. The CJEU's guidance was that parody has to have the essential characteristics of evoking an existing work while being noticeably different from it, and constitute an expression of humour or mockery. Whilst this guidance is useful to the English courts, it will be interesting to see how it is applied.
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"The legislative agenda is fairly clearly set out for 2016 (even if the timetable is ambitious to say the least) but almost everything is up in the air."