Friday 26 April 2013

The Convergence Green Paper that the European Commission didn’t write

The new European Commission Green Paper “Preparing for a Fully Converged Audiovisual World: Growth, Creation and Values” seems to have been a mouthful even for the Commission’s own PR department.  The press release translates it into ‘Internet on TV, TV on Internet’ - which does give a better flavour of what the Green Paper is about.

The Green Paper is a typical Commission mixture of current technology trends (dual screening gets a mention), market statistics leavened with a few anecdotes, lobbyists’ issues of the moment and hints of interventions that the Commission may have in mind for the future.  These are all underpinned by an unwavering belief in the efficacy of State-led intervention to achieve the Commission’s chosen public policy objectives.
As is de rigeur in documents such as this, the Commission has a grand vision:
“to seize the opportunity of this changing technological environment to ensure the widest possible access to European diversified content for all Europeans and, the widest choice of high quality offers”. 
That hints of a more interventionist Fortress Europe attitude than the Commission’s December 1997 Convergence Green Paper (PDF):
“This first step is intended to pave the way for the development of an appropriate regulatory environment which will facilitate the full achievement of the opportunities offered by the Information Society, in the interests of Europe and its citizens as the 21st century begins.”
Beyond the grand vision there is some fairly controversial stuff in the new Green Paper, particularly around the possibility of extending the Audiovisual Media Services Directive both in scope and to non-EU service providers. 

But I am afraid I tired of the DG-speak.  I started to imagine the 2013 Convergence Green Paper that the Commission could have written, but didn’t. 

Here it is.
“15 years ago, in December 1997, we at the Commission published a Convergence Green Paper.   We said:
“… the Commission's Communication on electronic commerce … proposed the principle of 'no regulation for regulation's sake'.   This principle applies equally to all areas of convergence.”
We tentatively suggested five key regulatory principles that should govern our activity in the field of convergence.  They included:

“Regulation should be limited to what is strictly necessary to achieve clearly identified objectives.”
Of those five regulatory principles that we suggested in 1997, this remains the most important.  We observed then that:

“public authorities must avoid approaches which lead to over-regulation, or which simply seek to extend existing rules in the telecommunications and media sectors to areas and activities which are largely unregulated today.”
The Commission recognises that the pursuit by government of general policy goals – such as media pluralism, cultural diversity, protection of consumers and minors, media literacy – carries with it the potential for unintended consequences and regulatory failure and to undo the general good that comes from freedom of private action.  The Commission appreciates that government failure is a more significant risk than market failure.    

Adhering to the principle of strict necessity, the Commission’s goal now must be to clear away all regulatory and legislative obstacles to future innovation in the audiovisual sphere.  The only permissible exception can be regulation that is conclusively demonstrated, by the most stringent criteria, to be both necessary and effective for the achievement of a generally agreed legitimate public policy objective; which carries a demonstrably minimal risk of unintended or damaging negative consequences, risk of regulatory capture or other regulatory failure; and which does not disproportionately interfere in fundamental human rights, in particular the right of freedom of speech.
The Commission recognises that the internet has brought forth the greatest flowering of individual communication and access to knowledge since the dawn of mankind.  Speech on the internet is a delicate flower which must not be damaged.  The Commission applauds the comments in the Joint Dissenting Opinion in the recent Animal Defenders case in the European Court of Human Rights:
“there seems to be an inherent contradiction in a viable democracy safeguarded by broadcasting restrictions. … A robust democracy is not helped by well-intentioned paternalism.”
Stated simply, the Commission’s role is now to clear the field of regulation and move out of the way.  This will enable the peoples of Europe to make their own viewing and listening choices at all levels: international, nation, group, community and individual.  If some people prefer Disney to Hugo, that is an expression of their individual autonomy and right to cultural self-determination.  As such it is outside the legitimate sphere of action of the Commission.

Each person in Europe must be free to choose and pursue their own personal goals.  It is not for the Commission to formulate policy goals and then to expect private actors, economic or otherwise, to pursue objectives that we set for them.  The Commission does not know what form any future innovation will take, or what the pace of innovation will be.  Nor can it ever know.  It is not the Commission’s place to attempt predictions, still less to formulate interventions based upon them. 
The Commission does not believe that it should set concrete targets to be achieved by some arbitrary future date.  We at the Commission shiver with embarrassment at the memory of the programme to ‘Complete the European Single Market by 31 December 1992’ - for all the world like some Soviet era tractor production plan.
The Commission recognises that innovation brings change.  It is no part of the Commission’s role to save legacy actors from the consequences of change, nor to try to influence future change in a particular direction.  The Commission recognises that any adverse consequences of change for particular sectoral and vested interests are outside the Commission’s legitimate sphere of action.  The Commission strongly believes that the European taxpayer should not to be compelled to subsidise historic industries in the name of cultural diversity. 
Turning specifically to the audio-visual sector, in the 1997 Green Paper the Commission said:
"… convergence may lead to less regulation in telecommunications and media sectors, and should not lead to more regulation in areas such as IT."
"Convergence may challenge current regulatory approaches, particularly, with regard to licensing of networks and allocation of resources, where such approaches reflect a perceived scarcity of both radio-frequency and of content."
"…in a fully digital environment, scarcity may over time become a less significant issue, calling for current regulatory approaches to be reassessed."  
Since scarcity has now all but disappeared, other than where artificially created by regulation, the time has come to reassess current regulatory approaches. 

Ideally the Commission would propose to sweep away the archaic structures of broadcast regulation, which have their roots in the government spectrum grabs of the mid 20th century.  However we recognise that most Member States will continue to cling to these regulatory models like the man with the red flag in front of the early motor car. 
Pragmatically, broadcast regulation is likely to wither as it becomes less and less relevant.  It is however imperative, as articulated in the 1997 Green Paper, to prevent outdated broadcast regulatory models from spreading any further, especially to the internet.  We now realise that it was a serious error in the AVMS Directive to extend regulation to so-called ‘TV-like’ on-demand services.  We will roll that back at the earliest opportunity.
The cross-border aspect of the internet is becoming increasingly significant.  The AVMS Directive does not apply to services originating outside the EU.  The Commission recognises that the people of Europe are readily able to understand that incoming foreign services are created under different sets of legal standards and to appreciate those services in that context. 
In the spirit of international cultural diversity the Commission believes that the fewest possible obstacles should be put in the way of incoming non-EU services, including where they are targeted at the EU.  The Commission would regard it as an act of unwarranted arrogance for the EU to seek to apply its content laws to services originating in non-EU countries and regions. 
The choice of European citizens to access and be informed about non-EU services that may not adhere to European content laws or standards should therefore not be denied or hindered by any Member State.  The Commission especially welcomes the opportunity for European citizens to share in the rich and diverse cultural heritage of the USA.”

Wednesday 17 April 2013

Does copyright control browsing? Meltwater in the UK Supreme Court.

[Updated with CJEU judgment of 5 June 2014]
Back in July 2011 I commented on the Court of Appeal judgment in NLA v Meltwater and explained how the reach of digital copyright had accidentally been increased beyond that in the offline world.  That was as a result of accepting that transient and temporary copies created in computer memory count as copies for copyright purposes.  This potentially extended copyright control to all user activities involving a computer, including browsing the web. 

The Public Relations Consultants Association subsequently appealed the Meltwater decision to the UK Supreme Court, which has now referred to the EU Court of Justice the question of whether browsing a website requires the permission of the copyright owner.
Technically, the question is whether browsing falls within the 'temporary copies' exception of Article 5.1 of the EU Copyright in the Information Society Directive.  Lord Sumption, who gave the judgment of the UKSC, concluded that browsing did fall within the exception, and so did not require the permission of the copyright owner.  However he recognised that the issue has a transnational dimension and has important implications for many millions of people across the EU making use of the internet.  That made it desirable that the decision be referred to the CJEU, so that the critical point might be resolved in a manner that would apply uniformly across the EU.

From a broader perspective the judgment is of particular interest for the extent to which the Supreme Court recognised the disparity, if browsing does require the copyright owner's permission, between the reach of copyright offline and online.  The judgment opens by pointing out that:
"Broadly speaking, it is an infringement to make or distribute copies or adaptations of a protected work. Merely viewing or reading it is not an infringement. A person who reads a pirated copy of a protected book or views a forgery of a protected painting commits no infringement although the person who sold him the book or forged the painting may do."
It goes on to explain that in the course of the ordinary use of the internet:

"[the user's] object is to view the material. The copies temporarily retained on the screen or the internet cache are merely the incidental consequence of his use of a computer to do that. The question which arises on this appeal is whether they are nonetheless infringing copies unless licensed by the rights owner."
Lord Sumption observed that the question:

"potentially affects millions of non-commercial users of the internet who may, no doubt unwittingly, be incurring civil liability by viewing copyright material on the internet without the authority of the rights owner, for example because it has been unlawfully uploaded by a third party. Similar issues arise when viewers watch a broadcast on a digital television or a subscription television programme via a set-top box."
Having analysed the relevant EU caselaw and concluded that browsing fell within the temporary copies exception, Lord Sumption addressed the consequences of his conclusion.  He said:

"We were pressed with the argument that if the viewing of copyright material on a web-page did not require a licence from the copyright owner, he would be exposed to large-scale piracy of a kind which would be difficult to detect or prevent.
I am not persuaded by this argument. … it has never been an infringement, in either English or EU law, for a person merely to view or read an infringing article in physical form. This state of affairs, which is recognised in the enumeration of the copyright owner's rights in articles 2, 3 and 4 of the Directive, has never been thought inconsistent with a high level of protection for intellectual property.
All that article 5.1 of the Directive achieves is to treat the viewing of copyright material on the internet in the same way as its viewing in physical form, notwithstanding that the technical processes involved incidentally include the making of temporary copies within the electronic equipment employed.
… [I]f it is an infringement merely to view copyright material, without downloading or printing out, then those who browse the internet are likely unintentionally to incur civil liability, at least in principle, by merely coming upon a web-page containing copyright material in the course of browsing. This seems an unacceptable result, which would make infringers of many millions of ordinary users of the internet across the EU who use browsers and search engines for private as well as commercial purposes."
…  [I]f merely viewing a web-page is not an infringement, that does not leave the copyright owner without effective remedies against pirates. It simply means that his remedy must be found against others who on the face of it are more obviously at fault. Nothing in article 5.1 impairs the copyright owner's right to proceed against those who unlawfully upload copyright material onto the internet, just as the copyright owner has always been entitled to proceed against those who make or distribute pirated copies of books, films, music or other protected works."
These passages exhibit a strong policy interest in achieving functional equivalence: for copyright to apply to the internet as far as possible in the same way that it did to physical copies before the digital revolution.  In that sense the Supreme Court judgment has similarities to the Canadian Supreme Court Copyright Pentalogy and the CJEU decision in Usedsoft v Oracle.

The approach articulated by Lord Sumption is the opposite of that stated by Proudman J at first instance: "The exception cannot have been intended to legitimise all copies made in the course of browsing or users would be permitted to watch pirated films and listen to pirated music." Lord Sumption, albeit with the benefit of later CJEU decisions in FAPL v QC Leisure and Infopaq II that were not available to Proudman J or the Court of Appeal, has made a clear statement that there is no policy reason why mere watching and listening (as opposed to downloading or printing) should be regarded as an infringement in the online world any more than in the offline world.  We now await finding out whether the CJEU agrees. [Yes, it does.]