Final countdown on Article 13: here is how bad it really is

Article 13 flowchart (detail)
Article 13: death by filters
Licentie

Today will see the third of the “final” trilogue meetings this week. Soon we will either have a final text of the copyright directive (and we are assuming it will be either bad or very bad), or it’ll be dead in the water. At this moment the fate of the directive largely hinges on the ability of the negotiations to find a compromise on Article 13. The negotiations this week rely on the mandate obtained by the Romanian presidency last Friday. This text, based on a compromise hashed out between France and Germany, has been widely characterized as the worst version of Article 13 yet.

While negotiators have been working on finding a final compromise this week, we have analysed the current text proposed by the presidency and created a flowchart of what’s in play. In its current version Article 13 now has nine operative provisions — now exceeding the number of articles the 2001 InfoSoc directive required to describe both the rights granted under copyright and the exceptions and limitations to those rights!

Article 13 flowchart (full)

The primary change on Article 13 is that it strips all online platforms (with the exception of a narrow set of non commercial services) of the liability limitations they hold under the E-Commerce Directive. Under the recent Romanian proposal Article 13 platforms are considered to undertake an act of communication to the public when users make available works on these platforms. This means that platforms need to either obtain licenses for those works or they can be held liable for unauthorized used of all works uploaded by their users.

Given that there are millions of people who on a daily basis share photos, videos, songs, drawings and text online via online platforms, it is impossible to obtain licenses from all rights holders for all these works. This means that platforms will be forced to limit their liability — and this is where upload filters enter the picture. To avoid liability, section 4(a) of Article 13 (the red box in the flowchart) requires platforms to ensure the unavailability of all works identified by rightsholders (i.e. by filtering them out), and to make best efforts to prevent future uploads of works for which rights holders have requested a take down.

While there are a number of provisions that would require platforms to allow uses under exceptions and limitations, these largely amount to legislative wishful thinking. As we and many others have argued repeatedly, upload filters are incapable of distinguishing between infringements of copyright and legitimate uses made under limitations and exceptions. Therefore, platforms will be faced with potentially unlimited liability, and they’ll clearly be incentivized to err on the side of caution and filter everything that is even remotely questionable from a legal standpoint.

In its current form Article 13 exposes all platforms that allow users to upload content to a a level of liability that does not leave them any other option than to limit how users can express themselves online.  

User Generated Content exception

Throughout the legislative process, we have been advocating that Europe needs a new exception that gives users of online platforms the right to remix. In January, Germany proposed a mandatory user generated content (UGC) exception, which seemed like an effort to make a positive contribution to the shape of the Directive. Yet, as we argued earlier, the exception was subject to remuneration, which made it unworkable.  

Following these efforts, the Romanian presidency then proposed language that would protect user generated content in the context of Article 13. The language was flawed, because it did not cover short works and entire images, and it was not applicable to content made available by users other than the individual creating the materials. In sum, it did not really serve the interests of users.

We were still hoping that the final compromise would include a better version of a UGC exception. However, the Romanian presidency ended up not creating (at least not clearly) a mandatory UGC exception applicable to users of every online platform. It kept a formulation similar to the one previously proposed, which does not seem applicable to content uploaded by users to any online platform, but only to platforms covered by Article 13. The language was improved and it now states:

“Users shall be allowed to upload and make available content that they have generated by themselves or by other users and which includes parts of, existing protected works and subject matter for purposes of quotation, criticism, review, caricature, parody or pastiche.”

While content may be uploaded by users other than the original creator, the exception covers usage of only parts of existing protected works, making it impossible for users to share user-generated content containing an entire artwork (e.. a meme using a painting in its entirety), or an entire short work (e.g. a meme using a poem in its entirety). In addition, the purpose must fit within a narrower definition, which does not include for example “illustration”. We recall that the previous language, namely the UGC exception proposed by the German delegation, had an open-ended list of purposes, which would give some flexibility to cover other reasonable uses.

Eleonora Rosati at IPKat argues that this might mean a big improvement to the exceptions framework because it would essentially be making these exceptions mandatory for Member States. While this indeed would be a positive outcome, we still believe that there is sufficient rationale to introduce a proper UGC exception clearly applicable to all uses in all online platforms.

Small and Medium Enterprise exception

Since the September vote, attempts to limiting of the scope of Article 13 have been one of the few options remaining to improve the Directive. We’ve argued previously that the scope of the article should be as narrow as possible. We know by now that there is no chance for such narrow focus, but the issue of small and medium enterprises has remained a significant one to follow.

The Romanian presidency proposes a “softer liability regime” (based solely on notice-and-takedown obligations) that covers companies with:

  • a yearly turnover of less than EUR 10 million, and
  • whose services have been available to the public in the EU for less than 3 years, and
  • whose average number of monthly unique visitors does not exceed 5 million.

Among these, the second condition is crucial, as it limits in any case the applicability of a weaker regime to only three years. After that period of operation, any online platform operating in Europe, big or small, will be subject to Article 13 provisions, and that essentially means filtering. Overall, we find this limitation of scope to be insufficient.

Today’s trilogue appears to be the last real opportunity for negotiators to make meaningful changes to the direction of Article 13 so that it protects the rights of users online. As highlighted above, there are still many needed alterations, such as a broader approach to UGC, and a more expansive SME exception. But even if lightning strikes and these positive changes were adopted, perhaps by now all is lost with Article 13. It’s becoming more clear every day that this provision was never anything more than a vain attempt to minimize the impact of the fundamental changes brought about by digital technologies and the internet on legacy business models.

There’s a good possibility that by the end of the week we’ll receive a final directive text with the worst version of Article 13 — suggesting massive negative repercussions for the liability of online platforms that will force those sites to install expensive and harmful upload filters. We’re quickly approaching a pivotal decision point with regard to the directive as a whole. The question just around the corner is: will millions of Europeans now be forced to call upon their Members of Parliament to stand and say “enough is enough” — and send this flawed copyright reform back to the drawing board once and for all.