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The fees that businesses will have to pay news aggregators of newspapers' online content for their services have been set after a Copyright Tribunal determined the terms were "reasonable".

The Tribunal accepted licensing terms agreed upon by news monitoring service Meltwater and the Newspaper Licensing Agency (NLA).

Under the agreement, which was reached following a protracted legal battle, news aggregators can pay a fixed annual rate based on the number of employees who are 'business end users' and the number of individuals at the business permitted to see the content the news aggregator services provides. Alternatively, a licence can be agreed on the basis of a variable rate where the fees due depend on the number of links the news aggregator services provide to the end user firms.

"We consider that the agreements in the form now proposed are reasonable and we will order that the scheme be varied accordingly," the Tribunal said in its final decision. (4-page / 496KB PDF)

Meltwater is a clippings service which scans newspaper websites for words that clients ask to be notified of so that they can track the news on certain subjects. It sells its services largely to PR firms who monitor news coverage related to issues or clients' businesses.

Meltwater bought a 'web database' licence from the NLA to enable it to provide news aggregator services to its end users. However, the company challenged the fees the NLA proposed to levy via its 'web end user' licence (WEUL) for those end users' access to the content through its service. This challenge was made on the grounds that this was "uneconomic".

Last year the UK Court of Appeal ruled that the material on newspaper websites was protected by copyright and dismissed counter arguments made by Meltwater, supported by the Public Relations Consultancy Association (PRCA), that exceptions to copyright law applied. The ruling meant that users of a clippings service must have a licence from newspaper publishers to click on links taking them to newspaper website pages to avoid infringing the publishers' copyrights.

Following the Court of Appeal ruling the Copyright Tribunal was tasked with determining the fees that the NLA could legitimately charge news aggregators' end users. In February it ruled that the NLA's proposed licensing terms were not wholly "reasonable" and issued an "interim decision" on broadly what was acceptable.

In its final decision the Tribunal said that the NLA and Meltwater had been able to "agree on all outstanding matters" and accepted the licensing terms which have been agreed upon by both parties.

Under the Copyright, Designs and Patents Act (CDPA) a Copyright Tribunal is obliged to "have regard to the availability of other [licensing] schemes, or the granting of other licences, to other persons in similar circumstances, and the terms of those schemes or licences" when determining whether a licensing scheme or licence in question is "reasonable".

The Tribunal has the power "to secure that there is no unreasonable discrimination between licensees, or prospective licensees, under the scheme or licence to which the reference or application relates and licensees under other schemes operated by, or other licences granted by, the same person," according to the Act.

The NLA, Meltwater and the PRCA issued a joint statement welcoming the Tribunal's final decision.

Jens-Petter Glittenberg, Meltwater co-founder, said: "The NLA and Meltwater are now committed to ensuring that UK end users of such monitoring services are licensed quickly, fairly and efficiently.

"We are happy with the Copyright Tribunal decision. Our aim from the outset was to seek clarification of UK copyright law for both rights-holders and end users, particularly for content freely available online," he added.

Francis Ingham, PRCA chief executive, said industry could be "satisfied" that the Tribunal's verdict was fair and clear, while David Pugh, managing director of the NLA, said he was "pleased" that there was now "clarity and more importantly certainty for clients."

The Tribunal's ruling would have a lasting impact on media monitoring organisations' licensing of online newspaper content, the chairman of the UK Media Monitoring Association (UKMMA) Steve White added.

"The Copyright Tribunal’s decision has established the terrain for rights management for the foreseeable future and given UKMMA members security to serve their clients effectively with the NLA’s web repertoire," he said.

In its February decision, the Copyright Tribunal had rejected Meltwater's claims that if the company operated a 'headline-only' service then its customers would not need a licence from the NLA. The Tribunal said that Meltwater was trying to argue a point it had previously lost in the Court of Appeal. The Court had said that headlines were copyrightable.

The Tribunal said the fact a 'headline-only' service may constitute less "usage" of copyrighted content than other services was a "less important factor" in determining the rate that would be due.

"End users of a headline only service should enter into the WEUL just like end users of the normal Meltwater News service of headlines plus extracts and should be subject to the same tariff rates," the Tribunal said in its interim decision in February. "The reason for this is that a point which we have decided in Meltwater’s favour on the issue of the appropriate rate for the normal Meltwater News service (including search fee), operates against setting a different rate for a headlines only service."

"The rate is a rate to give the copyright owners a fair share of the revenue generated by this service, which is indeed based on their copyright work but does not scale directly with the volume of copyright 'usage'," the Tribunal said.

"Our decision in relation to Meltwater’s headline-only service is that we reject the argument that requiring end user licensing under the WEUL, and at the same rates as the WEUL, is unreasonable. If Meltwater want to offer a headline only service to their end users they are free to do so but the service must be licensed in the same way as the headline plus text extract service," it said.

Late last year Meltwater and the PRCA were granted permission to challenge a finding by the Court of Appeal. Both claim that the court was wrong to rule that internet users who browse Meltwater’s website should have to pay a licence to the NLA if they access the newspapers’ online content through that channel. They insist that the users’ browsing activity would amount to making only “temporary copies” of the material and that therefore, under the terms of UK copyright law, those individuals would have a defence against copyright infringement for those actions. The Supreme Court is due to rule on the issue at the beginning of next year.

Copyright © 2012, Out-Law.com

Out-Law.com is part of international law firm Pinsent Masons.

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