Explanatory Memorandum to COM(2016)594 - Rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of tv and radio programmes - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2016)594 - Rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting ... |
|---|---|
| source | COM(2016)594  |
| date | 14-09-2016 |
1. CONTEXT OF THE PROPOSAL
• Reasons for and objectives of the proposal
Digital technologies facilitate the distribution of and access to works and other protected subject matter, with 49% of European internet users accessing music, audiovisual content and games online. 1 Broadcasters and retransmission service providers are increasingly investing in the development of digital and online services for the distribution of radio and television programmes. The online offerings of broadcasters include notably simulcasting services (TV/radio channels which are transmitted online alongside traditional broadcasting by satellite, cable or, terrestrial), TV catch-up services 2 and podcasts. Despite the growing variety of online services, broadcasters’ programmes often remain unavailable online to European citizens living in other Member States. In addition, the variety of TV and radio channels from other Member States provided by retransmission services differs across the EU.
Broadcasting organisations transmit on a daily basis a high number of news, cultural, political, documentary or entertainment programmes that they license from others or produce themselves. These programmes incorporate a variety of protected content such as audiovisual, musical, literary or graphic works. This requires a complex clearance of rights with a multitude of right holders. Often, the rights need to be cleared in a short time-frame, in particular when preparing programmes such as news or current affairs. In order to make their services available across borders, broadcasting organisations need to have the required rights for the relevant territories and this increases the complexity of the rights' clearance. For satellite broadcasting the clearance of rights has been facilitated by the application of the country of origin principle enshrined in the Satellite and Cable Directive (Directive 93/83/EEC), allowing broadcasters to clear the rights only in one Member State. That Directive does not apply when a broadcaster clears rights for its online services.
Operators of retransmission services, which aggregate a high number of TV and radio channels into packages, also face difficulties for acquiring all the rights necessary to retransmit the television and radio programmes of broadcasting organisations. The Satellite and Cable Directive provides for a system of mandatory collective management for retransmissions by cable of TV and radio broadcasts from other Member States. This system, facilitating the clearance of rights, does not extend to retransmission services provided by means other than cable over closed electronic communication networks, such as IPTV (TV/radio over closed circuit IP-based networks). Operators of such retransmission services therefore face a heavy rights clearing burden in order to be able to provide their services, in particular when they retransmit TV and radio broadcasts from other Member States.
This proposal aims to promote the cross-border provision of online services ancillary to broadcasts and to facilitate digital retransmissions over closed networks of TV and radio programmes originating in other Member States by adapting the Union legal framework. By addressing the difficulties related to the clearance of rights, it creates the conditions allowing broadcasters and operators of retransmission services to offer wider access to TV and radio programmes across the EU. As a result, this proposal will promote consumers' access to more TV and radio programmes originating in other Member States, both as concerns ancillary online services of broadcasting organisations and retransmission services. The proposal introduces a common approach in the Union while maintaining a high level of protection for right holders. In doing so, it contributes to the functioning of the internal market as an area without internal borders.
• Consistency with existing provisions in the policy area
The Digital Single Market Strategy 3 puts forward a range of initiatives in order to create an internal market for digital content and services. In December 2015, a first step was undertaken by the Commission with the proposal for a Regulation of the European Parliament and of the Council on ensuring the cross-border portability of online content services in the internal market 4 .
This proposal responds to one of the key objectives identified in the Digital Single Market Strategy: to enhance wider online access to TV and radio programmes by users across the EU. Promoting the cross-border provision of online services ancillary to broadcasts and facilitating digital retransmissions of TV and radio programmes originating in other Member States is a significant step that addresses a specific obstacle to cross-border access to broadcast content for the benefit of users.
This proposal is consistent with the legal instruments in the domain of copyright, in particular Directive 93/83/EEC, Directive 2001/29/EC, Directive 2006/115/EC and Directive 2014/26/EU. Those Directives, as well as this proposal, contribute to the functioning of the internal market, ensure a high level of protection for right holders and facilitate the clearance of rights.
This proposal also contributes to the improvement of the cross-border reach of audiovisual media services and hence complements Directive 2010/13/EU 5 .
• Consistency with other Union policies
According to Article 167 of the Treaty on the Functioning of the European Union (TFEU), the Union shall take cultural aspects into account in its action under the Treaties. By facilitating access to TV and radio programmes, this proposal would enhance access to cultural content, news and information.
This proposal contributes to promoting the interests of consumers by promoting more access to TV and radio programmes from other Member States and thus is consistent with the EU policies in the field of consumer protection and Article 169 TFEU.
2. LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY
• Legal basis
The proposal for a Regulation is based on Article 114 TFEU. This Article confers on the EU the power to adopt measures which have as their object the establishment and functioning of the internal market. This includes the freedom to provide and to receive services.
The EU has harmonised the rights which are relevant for the online dissemination of works and other protected subject matter as well as for the retransmission of TV and radio programmes (notably the rights of reproduction, communication to the public and making available) in Directive 2001/29.
The present proposal for a Regulation concerns the facilitation of the clearance of rights for ancillary online services by broadcasting organisations by introducing a principle of country of origin, according to which the copyright relevant act takes place solely in the Member State where the broadcasting organisation is established. It also facilitates the clearance of rights for retransmission services provided over closed networks (other than cable), by introducing rules on mandatory collective management. The aim of the proposal is to take account of, inter alia, the changes in technology which necessitate adaptation of the previously harmonised legal framework.
The proposed instrument is a regulation given the need to ensure that the rules achieve the objective in a uniform manner and are directly applicable.
• Subsidiarity (for non-exclusive competence)
The issue addressed by this proposal, namely wider access to TV and radio programmes by citizens across the Union, is in essence of a cross-border nature. Only a Union instrument can establish a rule that applies the principle of the country of origin to cross-border transmissions of TV and radio programmes. Concerning the exercise of retransmission rights, only a Union instrument can remove the existing market fragmentation in the way rights are managed for digital retransmission services and thereby ensure legal certainty to retransmission operators. Nevertheless, certain specific provisions concerning the application of mandatory collective management to retransmission services provided over closed networks should be determined by Member States.
• Proportionality
The proposal establishes enabling mechanisms in order to facilitate the clearance of copyright and related rights in relation to certain types of online transmissions and retransmissions over closed networks of TV and radio programmes. It is targeted and covers only specific segments of the market (ancillary online services of broadcasters and certain retransmission services provided by means of IPTV and other “closed” electronic communications networks) while other services (e.g. on-demand services not linked to a broadcast) are outside its scope. In addition, the proposal does not oblige broadcasting organisations to provide their online ancillary services across borders, nor does it oblige operators of retransmission services to offer programmes from other Member States. The proposal does not prevent either the exercise of the contractual freedom of the parties to limit the exploitation of the rights affected by the principle of country of origin done in compliance with Union law.
Concerning the country of origin rule applicable for clearing rights for the broadcasters' ancillary online services, it only localises the relevant copyright acts for the purposes of exercising the rights (e.g. obtaining a licence). Therefore, the country of origin does not affect the localisation of the relevant copyright acts when rights have not been cleared (i.e. in the case of unauthorised transmissions).
As concerns the retransmission rights, the proposal only affects the exercise of the retransmission rights while leaving these rights intact. Moreover, the proposal covers retransmissions insofar as they concern TV and radio programmes originating in other Member States.
• Choice of the instrument
A regulation is directly applicable in Member States and therefore this instrument guarantees a uniform application of the rules across the Union and their entering into force at the same time. This would allow ensuring full legal certainty to service providers operating in different territories. The direct applicability of the provisions of this proposal would prevent legal fragmentation and provide a harmonised set of rules to facilitate the cross border provision of TV and radio programmes online and of the retransmission services.
3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS
• Ex-post evaluations/fitness checks of existing legislation
The Commission carried out an evaluation of Directive 93/83/EEC 6 and in particular of the effectiveness and relevance of the principle of the country of origin as it applies to satellite transmissions and of the rules on mandatory collective management for cable retransmissions. The evaluation showed that these mechanisms have facilitated the clearance of copyright and related rights for cross-border satellite broadcasts and for the simultaneous retransmissions by cable of broadcasts from other Member States. It however pointed out that Directive 93/83/EEC - due to the technology-specific nature of its provisions - does not apply to the new digital technologies used for transmission and retransmission of TV and radio programmes that have emerged in recent years.
• Stakeholder consultations
A public consultation on the review of Directive 93/83/EEC was conducted from 24 August to 16 November 2015. 7 It invited respondents to give feedback on the functioning of the rules related to the clearance of rights for satellite broadcasters and cable operators and to assess the possible need to extend these rules to online transmissions and to retransmissions by other means than cable. In addition, the Commission had extensive discussions with stakeholders (public and commercial broadcasters, telecommunications operators, right holders and collective management organisations (CMOs)) in 2015-2016 to discuss issues related to online transmissions and retransmissions of TV and radio programmes.
Consumers are generally in favour of a broad extension of the country of origin principle to cover all online services, even if some of them consider that this mechanism may not be sufficient to ensure cross-border access. All public service broadcasters as well as commercial radios call for the application of the country of origin principle to broadcast-related online services. By contrast, commercial broadcasters, right holders and CMOs express strong reservations on extending the application of the country of origin principle. They consider that any such extension would restrict their ability to license rights on a territorial basis.
Consumers, cable and telecommunication operators, public service broadcasters and the vast majority of CMOs are in favour of a possible extension of mandatory collective management to the simultaneous retransmissions of TV and radio programmes on platforms other than cable. Many CMOs and public service broadcasters as well as some cable and telecommunication operators insist that the extension should be limited to 'closed environments' which function in a manner comparable to cable. Most right holders are against a possible extension of the mandatory collective management regime due to the potential disruptive effect on the markets. Commercial broadcasters also tend to oppose it.
The measures foreseen in this proposal take into account a number of concerns signaled by stakeholders, notably as regards the scope of extension of the principle of the country of origin (e.g. broadcasters' video-on-demand services are outside the scope and the intervention only relates to the clearance of rights that are necessary for the ancillary online services) and of the mechanism of mandatory collective management of rights (which is limited to closed networks).
• Collection and use of expertise
Legal 8 and economic 9 studies have been conducted on the application of EU copyright rules to the digital environment (in particular with regard to online transmissions and retransmissions in digital networks). In addition, a study has been carried out in 2015/2016 to support the evaluation of the Satellite and Cable Directive and the assessment of its possible extension. 10
• Impact assessment
An impact assessment was carried out for this proposal. 11 On 22 July 2016, the Regulatory Scrutiny Board gave a positive opinion on the understanding that the impact assessment will be further improved. 12 The final Impact Assessment takes on board the comments contained in that opinion.
The impact assessment examines two sets of policy options, aimed at facilitating the clearance of rights (i) for the online transmissions of TV and radio programmes; and (ii) for digital retransmissions of TV and radio programmes.
As regards online transmissions of TV and radio programmes, three policy options were examined further to the baseline option. A non-legislative option (Option 1), consisting in promoting voluntary agreements to facilitate the clearing of rights for certain broadcasters' online services, was not retained as its outcome would be uncertain, depending on the stakeholders' willingness to license rights, and would not ensure a homogenous licensing regime. The application of the country of origin principle to online transmissions was examined through two legislative options: under Option 2, the scope of application was limited to broadcasters' online services which are ancillary to the initial broadcasts (notably simulcasting and catch-up services); under Option 3 the application was extended to online transmissions which are not linked to a broadcast (webcasting services). Option 2 would significantly reduce the transaction costs faced by broadcasters willing to make their transmissions available online and across borders. Option 3 would in principle extend these benefits to webcasters; however, considering that the webcasting market is still at a development stage and that online operators may easily relocate their establishment in the EU, it would also generate legal uncertainty for right holders and could lead to a lowering of the level of protection. Option 3 was therefore rejected. The application of the country of origin principle only to certain well-identified online services of broadcasters (Option 2) was considered more appropriate. By reducing the transaction costs related to cross-border transmissions, this option will open new opportunities for broadcasters to offer their online services across borders, in particular as concerns content which does not rely on territorial exclusivity. This option does not restrict right holders and broadcasters' possibility to continue licensing rights on a territorial basis, subject to the requirements of EU and national law.
As regards digital retransmissions of TV and radio programmes, two policy options were considered in addition to the baseline option. Under Option 1, the scope of application of mandatory collective management of rights was limited to IPTV retransmission services and other retransmission services provided over 'closed' electronic communications networks, while under Option 2 it would also cover over-the-top retransmission services, as long as they are provided to a defined number of users. Although Option 2 would allow a wider range of retransmission services to benefit from reduced transaction costs for the clearance of rights, it would also entail risks of undermining right holders' exclusive online rights and distribution strategies, leading to a reduction of licensing revenues. Option 1 did not present such a risk, as most of the retransmission services provided over 'closed' electronic communications networks rely on the established infrastructures located in a particular territory. Option 1 was chosen as the preferred option. It is expected to increase consumer choice in terms of retransmission services of TV and radio broadcasts from other Member States.
The proposal is expected to yield positive results in terms of benefits versus costs. Transaction costs associated with the clearance of rights should decrease, fostering better choice to consumers without disruptive effects on right holders. Furthermore, the proposal could generate new licensing opportunities for right holders and additional licensing revenues.
• Regulatory fitness and simplification
The proposal will reduce the transaction costs faced by TV and radio broadcasters as well as retransmission service providers and would therefore be positive for SMEs active in this area. It is also expected to be beneficial to right holders, in particular individual right holders, micro-companies and SMEs that do not have the capacity to manage individual licensing deals with a high number of service providers in different territories. Therefore, exemptions of micro-companies or mitigating measures in favor of SMEs have not been deemed necessary.
New technological developments have been carefully examined and taken into account in this proposal, which focuses on online transmissions and digital retransmissions of TV and radio programmes. Certain types of online transmission and retransmission services have been excluded from the scope of this proposal, mainly on the basis of the uncertainty linked to ongoing market developments and the nascent nature of certain services.
• Fundamental rights
By establishing the licensing regimes applicable to certain types of cross-border online transmissions and retransmissions over closed networks, the proposal will have a limited impact on copyright as a property right and on the freedom to conduct a business, protected under Articles 17 and 16 of the Charter of Fundamental Rights of the European Union. At the same time, the proposal will have a beneficial impact on the freedom of expression and information, protected under Article 11 of the Charter, as it will increase the cross-border provision and receipt of TV and radio programmes which originate in other Member States.
4. BUDGETARY IMPLICATIONS
The proposal has no impact on the European Union budget.
5. OTHER ELEMENTS
• Implementation plans and monitoring, evaluation and reporting arrangements
The first data collection should take place when the Regulation enters into force in order to establish the baseline for future evaluations. The monitoring process would then focus on progress made in relation to the cross-border availability of TV and radio programmes, with data collection taking place every two to three years.
Pursuant to Article 6 of the proposal, the Commission will carry out a review of the Regulation and will present a report on the main findings to the European Parliament, the Council and the European Economic and Social Committee. That report will include an assessment of the effects of the Regulation on the cross-border accessibility of ancillary online services. The review shall be conducted according to the Commission's Better Regulation Guidelines.
• Detailed explanation of the specific provisions of the proposal
Article 1 defines the services covered by the measures (notably 'ancillary online services' and 'retransmission' services). These definitions will be applied in a uniform manner in the Union.
Article 2 establishes that the copyright acts relevant for the provision of an ancillary online service occur solely in the Member State where the broadcasting organisation is established. The notion of the 'principal establishment' of a broadcasting organisation would be in accordance with Union law.
Articles 3 and 4 regulate the exercise of the right of retransmission covered by the proposal. They lay down rules that are similar to those laid down in Articles 9 and 10 of Directive 93/83/EC concerning cable retransmissions. Article 3 leaves certain discretion to Member States as in the case of cable retransmission under Directive 93/83/EC. Articles 3 and 4 include provisions on mandatory collective management of copyright and related rights relevant for retransmission, on legal presumptions of representation by collective management organisations and on the exercise of the cable retransmission right by broadcasting organisations.
Article 5 sets out transitional provisions.
Article 6 provides that the Commission shall carry out a review of the Regulation and present a report on its main findings. It obliges Member States to provide the Commission with necessary information for the preparation of that report.
Article 7 sets out the final provisions, namely the date of entry into force of the Regulation and the date from which the Regulation shall apply.