Industries lobby EU Commission to cut copyright fees

But proposal 'may have a bumpy ride'

At the same time as the EU Commission has launched a consultation paper with proposals to reform current copyright levies, the IT, telecommunications, electronics and digital industry associations have launched the Copyright Levies Reform Alliance (CLRA), campaigning for urgent reform of copyright levies.

Copyright levies operate in all EU states, including the accession states, other than the UK, Ireland, Luxembourg, Malta and Cyprus. The UK, Ireland and Malta only permit copying/recording broadcasts for home consumption. Luxembourg permits private copying. The legal position in Cyprus is unclear, and the USA allows certain private copying but does not impose such levies.

In the 1960s, EU Member States began imposing levies on the price of copying equipment before the advent of copy protection technology to compensate copyright owners for the lost royalties from private copying of music, movies, text and images.

They were charged on the prevailing technology of the time - blank audio and video cassettes, photocopiers and tape recorders. Now digital devices are the principal mechanism for copying and EU States operate national copyright levy regimes.

Some EU States impose a levy on the purchase price of equipment and accessories as diverse as CD recorders, MP3 players, blank CDs and mobile phones. Some impose the levy on the media only. Some impose the levy on both equipment and the media. These levies are not paid to the copyright holders but are collected by national collecting agencies (ICTs), which variously provide management services to copyright holders or only administer copyright levies. These services are provided both to domestic copyright holders and those in other EU States. The services are and subject variously to the usual oversight ("interference") by National State bodies.

Needless to say, the ICTs deduct fees for their services before any copyright fee reaches the holder. The fee structures vary. Some are negotiated with artistic bodies and some allocate a portion or all of the funds to social funds for the benefit of authors or performing artists.

The issue has attracted attention because it is alleged the copyright fees across the EU states have risen from £341m (US$628m) in 2001 to £820m (US$1.5bn) in 2005, though some estimates are lower than this.

iPods, mobile phones, and DVDs contribute substantially to these fee rises. Equally, these levies increase by as much as 50 per cent the cost of modern electronic equipment in EU States operating copyright levies.

The chief objections are:

  • This is a multiple payment scenario where consumers pay for permission to copy at the time of download, and are charged again in the purchase of devices used to play the content.
  • Levies are also charged on scanners and printers and other devices at disproportionate rates to the cost of the equipment.

The European Commission, in its consultation paper, is not seeking to abolish the levies. Rather, it is proposing that ICTs should ensure that copyright levies are calculated using objective criteria as well as ensuring that the products subject to levies are used for copying and the extent to which this actually occurs.

"Copyright levies on digital products are an outdated form of taxation that penalises consumers, artists and industry alike," and "European lawmakers have an obligation to bring real benefits by establishing efficiency and transparency in the collection of levies while phasing out the levies system."

However, this proposal may have a very bumpy ride. The levies provide substantial built-in subsidies to arts and culture in many of the EU states, as they are frequently channelled via national, social and cultural funds. Taxes, probably more transparent in application, would have to be substituted for the reduction in these levies. This would be "politically unpalatable in some of the major EU States".

Copyright © 2006, IT-Analysis.com

Sponsored: Driving business with continuous operational intelligence