DSM Directive implementation update: With one month to go it is clear that the Commission has failed to deliver

wreck
Italian implementation threatens to set a new low
Licentie

Today it is exactly one month until the 7th of June, the day on which the EU member states have to have implemented the provisions of the 2019 copyright in the digital single market directive in their national laws. And while the 27 Member States have had more than 2 years to complete their national implementations so far only two of them have managed to fully implement the directive: the Netherlands adopted its implementation law in December of last year and on the 28th of April the Hungarian parliament adopted its implementation law

In addition there are two Member States who have adopted so-called delegation laws that allow them to implement the provisions of the directive via subsequent administrative decrees. France adopted its delegation law in December 2019 and on the 20th of April Italy followed suit and adopted its delegation law. While the French implementation decree (which will include the actual provisions to be included in the copyright act) is still nowhere to be seen, the Italian Comitato Consultivo Permanente per il Diritto D’Autore is discussing a draft version of the Italian Implementation decree (pdf in Italian) today. 

Based on what is contained in the draft the Italian implementation is shaping up to be the worst one yet. The draft fails to implement exceptions that are mandatory under the directive (the fallback exception for out of commerce works in Article 8(2) CDSM), it claims that users can rely on a non-existing parody exception and it also claims (in the text of the law itself) that automated content recognition systems (a.k.a upload filters) can “ascertain clear violations” of copyright (something that literally everyone including the French government agrees that they can’t).

Otherwise, there has been relatively little recent movement in the EU Member States. The German implementation draft is still making its way through parliament. It is now in the final stages of deliberation and the the final vote is expected to take place on the 20th of May. Meanwhile most other Member States seem to be stuck in a holding pattern after having completed public consultations of their draft implementation legislation, shying away from introducing legislation into their parliaments.

Commission failure to provide guidance creates massive legal uncertainty.

This reluctance to move forward is clearly the result of the European Commission’s abject failure to deliver its long overdue Article 17 implementation guidance, which is intended to help Member States to resolve the internal contradictions contained in Article 17 and to implement it in a fundamental rights compliant way. 

The guidance which had originally been expected to be published in the second half of 2020 is being held up at the political level of the Commission since early this year.

The failure to deliver the guidelines puts those Member States who had counted on the Commission’s guidance into a difficult position. By waiting for the guidance to be published they have effectively lost the ability to implement the Directive in time.

Without the guidance from the Commission (or from the CJEU, which has recently postponed the AG opinion in the Polish case challenging the fundamental rights compliance of Article 17) Member States will need to figure out themselves how they intend to reconcile the requirement on platforms to ensure that legitimate uses of copyrighted works are not blocked with the parallel requirement to make best efforts to prevent the availability of works that rightholders want to have blocked.

Unfortunately, none of the already existing implementation laws provide any guidance either. Both the Dutch and the Hungarian laws have stuck to copying the language contained in the Directive including all of its internal contradictions. As a result they are passing the responsibility of reconciling the contradictions that they were not willing to address themselves on to the online platforms. Platform operators will now have to find a balance between the diverging interests of rightholders and users of their platforms. Given that they face a one-sided liability risk, there are huge incentives for them to err on the side of caution and structurally block legitimate uploads.

With the Commission’s guidance still missing in action, Member States still working on their implementations should instead orient themselves on the principles expressed in the Commission’s draft guidance and the arguments brought forward by the three EU legislators in last November’s CJEU hearing of the Polish challenge to Article 17. At both occasions the Commission made it clear that implementations of Article 17 must limit the use of automated blocking of uploads to situations where such uploads are “manifestly infringing”. Such safeguards must operate ex-ante, meaning that implementations that only include an ex-post complaint and redress mechanism (as it is the case in the Dutch and Hungarian implementations) do not meet the requirements established by the directive. 

At the moment only the implementation proposals from Germany, Austria and Finland fulfil these conditions to some extent. Of these, the German proposal is the only one that still has a chance to become enacted before next month’s implementation deadline. 

While it is not unusual that some EU Member States miss the implementation deadlines for an EU directive, it is fairly exceptional that the CDSM directive will be implemented in less than a hand-full of Member States when it becomes effective on the 7th of June. Unlike in other cases the blame for the failure to meet the deadline, and the resulting legal uncertainty for users, rightholders and service providers will lie squarely with the Commission this time. 

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