The European Parliament has passed the Copyright Directive, a controversial law that critics fear could spell the beginning of the end for the open internet and user-generated content from memes to parodies.
On the morning of 15 April, the Council of the European Union formally endorsed the EU Copyright Directive by a majority vote. It will now be up to each EU member state to implement the law domestically.
The legislation is designed to modernise the EU's 18-year-old copyright laws for the digital age by forcing tech companies to share more revenue with the producers and publishers of the creative works and news stories posted on their platforms. They will also have to change the way they police infringements on their sites.
Media companies and artists from Mike Leigh to Paul McCartney believe the law is essential to provide creators of content with fair remuneration and avoid the exploitation of their works online, but free internet advocates argue that it will force platforms to embed automated censorship tools in their networks.
Their dispute has been centred on two key parts of the legislation: Article 15 (formerly Article 11), known as the "link tax", which orders news aggregators to pay publishers for linking to their sites, and Article 17 (formerly Article 13), which requires platforms to automatically filter new content for copyright infringements using tools dubbed "upload filters".
Changes to Article 15
Google has been among the most vociferous critics of the law and has lobbied hard against the legislation. The search giant has threatened to pull Google News from the EU if Article 15 is passed, as it would force the company to pay publishers for posting snippets from their articles that show up the news aggregator's search results.
Kathy Berry, an intellectual property lawyer at Magic Circle law firm Linklaters, believes the final version of the Directive will dispell most of Google's concerns.
"There are a number of carve-outs set out now in Article 15," Berry told Techworld. "It won't apply to active metalinking and it won't apply in respect of the use of individual words or very short extracts from press publications.
"These are new carve-outs that have been added in the last couple of versions of this ... and those are definitely with the intent of allowing Google News-type platforms to continue to operate, provided that all they are showing is these very short extracts from the press publications. So in my view, it's not actually going to have a very significant impact on those types of business models after all."
In a tweet responding to these amendments, Google Europe acknowledged that they had "improved" the Directive, but added that it "will still lead to legal uncertainty and will hurt Europe's creative and digital economies".
Despite these qualms, tech titans such as Google are well-equipped to administer these new requirements of the link tax. It will more severely disadvantage small and independent publishers, who may lack the resources required to link to news websites.
Concerns over Article 17
Article 17 could also cause businesses and members of the public to suffer. Tech companies will now be obligated to police their platforms either by entering into license agreements with rights holders or ensuring that the platforms publish any infringements of their work.
Platforms may choose to adopt a form of automated content monitoring that function as upload filters. These will likely take the form of bots that assess anything that's posted for copyright infringements by comparing the content with databases of protected works. These upload filters will struggle to tell the difference between copyright infringements and legal parodies.
Sophie Goossens, a digital media lawyer at Reed Smith, believes this could lead platform arrangements erring on the side of caution to block any content that might leave them liable for copyright infringement.
"It also puts platform operators in the uncomfortable position of having to assess whether a particular piece of content benefits from a copyright exception; an assessment that, in many cases, it may not be qualified to make," she said.
Goosens added that smaller tech companies would likely be most affected by the new rules.
"The largest technology platforms have already implemented upload filters but such technology can be expensive to acquire or take a long time - and a lot of money - to develop internally," she said. "There is a concern that it will be the smaller, European technology companies that will be most severely impacted by this new requirement, rather than the US technology giants."
Giles Derrington, head of policy at technology trade association techUK, argues that it will also make it harder for companies to serve European markets and restrict the freedoms of the public.
"Requirements for platforms to filter all user-uploaded content will likely result in a reduced user experience and the over-removal of legitimate content," he said. "The creation of a new neighbouring right for press publishers will make sharing news articles online more difficult, making it harder for the public to find good-quality journalism online."
Effects on online freedoms
Julia Reda, an MEP from the Pirate Party Germany, said that Article 17 will be "devastating for network freedom" and "disillusion a whole generation".
"Commercial sites and apps where users can post material must make 'best efforts' to preemptively buy licences for anything that users may possibly upload – that is: all copyrighted content in the world. An impossible feat," she explained in a blog post.
"In addition, all but very few sites (those both tiny and very new) will need to do everything in their power to prevent anything from ever going online that may be an unauthorised copy of a work that a rightsholder has registered with the platform. They will have no choice but to deploy upload filters, which are by their nature both expensive and error-prone.
"Should a court ever find their licensing or filtering efforts not fierce enough, sites are directly liable for infringements as if they had committed them themselves. This massive threat will lead platforms to over-comply with these rules to stay on the safe side, further worsening the impact on our freedom of speech."
Other critics worry that the law will stifle creativity. Creative Commons chief Ryan Merkley observed that The Beatles would have been prevented from performing cover versions under the proposed rules. For members of the public, Article 17 could mean that the text, music and videos they post to blogs, social networks and comment sections are yanked from the net at the point of upload.
Goossens clarified that Article 17 draws a clear distinction between professional and non-professional users.
"Any licence taken by a platform will cover a consumer's act of uploading that content to the platform," she said. "However, this is not the case for professional users (being users acting in a commercial capacity or generating significant revenues on the platform). It remains to be seen whether platforms will take a stricter approach to these professional users as they will need to rely on the permissions and licences taken by the latter to upload and communicate their works via the platform. 'Youtubers' and self-releasing artists are likely to be most impacted."
The death of memes?
Many critics of the Directive warned that it could spell the end of memes, as they are often based on copyrighted images, but Berry believes these fears are overstated due to legislation's exemptions for quotation, criticism, review, caricature, parody, and pastiche. The platforms will be responsible for both protecting their users' rights to use this, as well as for policing their infringements.
"There is no detail on how that is supposed to be achieved in either case," said Berry. "It doesn't say that they have to use that content recognition technology, or that there has to be a level of human review, or that certain T&Cs have to be in place.
"There's no detail on how they're supposed to make sure that infringing content is not uploaded. And there's also no detail on how they're supposed to ensure that users can still rely on quotation, criticism, review, caricature, parody, or pastiche - they just do.
"So while the Directive does defend memes by saying users must be able to rely on whatever they are consider - caricature, parody or pastiche probably in this case - the specifics of how that's supposed to be achieved are being left to either member states, or more likely to the platforms themselves. This is why I think we can say it functions as a statement of ideals, but with lots of questions remaining. And if we are trying to advise clients on what they have to do, that's very difficult with the current state of detail within the Directive."
How did we get here?
The first draft of the proposed EU Copyright Directive was issued on 14 September 2016. Two years later, Article 11 and 13 were added to the law, which was sent to the European Parliament for approval.
Ahead of the June 2018 vote, a group of technology luminaries including World Wide Web inventor Tim Berners-Lee and Wikipedia cofounder Jimmy Wales outlined their objections to the proposals in a joint letter to Antonio Tajani, the president of the European Parliament.
"By requiring internet platforms to perform automatic filtering all of the content that their users upload, Article 13 takes an unprecedented step towards the transformation of the internet from an open platform for sharing and innovation, into a tool for the automated surveillance and control of its users," it read.
MEPs decided that the proposals required further debate.
In February 2019, they reached a breakthrough in negotiations. Lawmakers agreed that the upload filters will be required for any platforms that have been operating for more than three years and have revenues over €10 million and more than five million monthly users. There will also be exemptions for non-profit and open source platforms such as Wikipedia and Github.
They also agreed that the link tax would apply to any link from a news story with more than "single words or very short extracts".
On 26 March, the European Parliament approved the legislation. A total of 348 MEPs voted in favour of the proposals, while 274 voted against them. It was then sent to the EU Council of Ministers for a final vote. On 15 April, the Directive was approved by a majority vote of 19-6, with three member states abstaining. The UK voted in favour, while Italy, the Netherlands, Poland, Sweden, Finland, and Luxembourg voted against, and Belgium, Estonia and Slovenia abstained.
The Directive will now be signed by the European Council and Parliament before it's published in the EU's Official Journal. It will then be implemented on a date to be determined, likely in late May or early June. Each member state of the bloc will then have 24 months to implement the text into their national laws.
It will then be up to the courts to choose how to interpret the rules.
"While EU negotiators have managed to get this controversial piece of legislation over the line ahead of the European Parliament elections in May, both creative industries and online platforms will have many questions about the practical application of the proposals," said Francine Cunningham, senior public affairs manager at international law firm Bird & Bird.
"In the end, it will likely be up to the courts to decide whether platforms have really made 'best efforts’ to avoid copyright infringement by the users and what 'very short extracts' are excluded from the new press publishers' right."
Michael Gardner, a partner and head of IP and commercial at London law firm Wedlake Bell, told Techworld that if the law is passed it may not affect UK citizens due to Brexit, although British businesses serving the EU market will still have to comply with the terms.
"It is important to note that the new law, if it goes through, would be a 'Directive' – a piece of legislation that requires member states to implement compliant laws within a period of time – usually around three years," he said.
"The UK will probably have left the EU and completed any 'transitional period' by the time this new Directive needs to be implemented. So it is quite possible that for users in the UK, the new laws will not take effect, even if they are adopted by the EU.
"Brexiteers will say this provides an opportunity for the UK to diverge and be a more attractive place for internet companies to do business, free of the EU’s restrictive approach to the internet. With so much uncertainty over the terms of the UK's departure from the EU, it is difficult at this point to know what impact the proposed Directive will have."
EU member states may have different reactions to the proposed legislation.
"We can expect certain member states to introduce their own nuances and clarifications when doing so and so it will be interesting to observe how harmonised the position is across Europe at the end of the implementation period," she said.
The UK's adoption of the Directive could be particularly nuanced as the country will no longer be under its remit once it leaves the EU. Linklater lawyer Berry believes it could have an impact on the country's global trade negotiations.
"What will be interesting to see is whether or not the UK wants to align itself with the EU's approach to internet regulation or align itself more with the US' approach to internet regulation, which is much more tech-company friendly, and that may well have its place in larger trade negotiations," she said.
"But really, your guess is as good as mine. There's certainly formal communication in respect of what might happen, but it will be interesting to see it as part of the broader picture. I think what you see from EU versus US perspective when it comes to tech regulation is that the US is very good at creating an internet regime that acts as a sort of incubator for tech companies, whereas the EU seems to be working more towards giving rights to content creators - probably at the expense of tech companies."