The music market in the digital age: the legal environment <ul><li>Anne-Catherine Lorrain </li></ul><ul><li>Legal adviser ...
The music market in the digital age: the legal environment <ul><li>Rightholders </li></ul><ul><li>Authors’ rights and neig...
The music market in the digital age: the legal environment <ul><li>The main legal objectives for the development of the Eu...
<ul><li>Clearing the boundaries of rightholders’ authorisation of exploitation </li></ul><ul><li>For which uses did righth...
<ul><li>Initiatives of rightholders: </li></ul><ul><li>- Santiago Agreements  (authors’ performance rights; model agreemen...
<ul><li>Complaints of RTL (2000) and of Music Choice (2003) against CISAC to the competition authorities of the European C...
Adapting rights’ licensing to the Internet <ul><li>How to conciliate competition law and collective  management? </li></ul...
Adapting rights’ licensing to the Internet <ul><li>Model 1 </li></ul>Collecting society Country 1 X 24 societies = 24 reci...
Adapting rights’ licensing to the Internet <ul><li>Model 2 </li></ul><ul><li>- Classical system of reciprocal agreements (...
Adapting rights’ licensing to the Internet <ul><li>Model 3 </li></ul><ul><li>- Rightholders’ model </li></ul><ul><li>Right...
Adapting rights’ licensing to the Internet <ul><li>Competition among collective management societies: </li></ul><ul><li>th...
What acts are illegal when using music on the Internet? <ul><li>Normative context: Towards a greater protection of rightho...
What acts are illegal when using music on the Internet? <ul><li>Protection of Technical protection measures (TPM) </li></u...
What acts are illegal when using music on the Internet? <ul><li>Technical protection measures  v.  private copying? </li><...
What acts are illegal when using music on the Internet? <ul><li>The P2P issue </li></ul><ul><ul><li>The inner paradox of P...
What acts are illegal when using music on the Internet? <ul><li>The P2P issue </li></ul><ul><ul><li>The liability of P2P s...
The on-line music market and its users <ul><li>The « interoperability » issue </li></ul><ul><li>The importance of a good m...
Interoperability <ul><li>The position of the French legislator </li></ul><ul><li>Which regulation: law or competition? </l...
For a good merchant policy of on-line music services <ul><li>The price issue </li></ul><ul><li>Choice of the law applicabl...
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AC Lorrain - The Music Market in the Digital Age: the Legal Environment

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AC Lorrain - The Music Market in the Digital Age: the Legal Environment

  1. 1. The music market in the digital age: the legal environment <ul><li>Anne-Catherine Lorrain </li></ul><ul><li>Legal adviser & Researcher at CERDI </li></ul><ul><li>(University Paris Panthéon Sorbonne – Paris Sud) </li></ul><ul><li>STAGE « CULTURAL INDUSTRIES IN EUROPE » </li></ul><ul><li>Musical Industries facing technological evolutions </li></ul><ul><li>Paris, 20 June 2006 </li></ul>
  2. 2. The music market in the digital age: the legal environment <ul><li>Rightholders </li></ul><ul><li>Authors’ rights and neighbouring rights </li></ul><ul><li>Technical protection measures </li></ul><ul><li>Interoperability </li></ul><ul><li>Good merchant policy </li></ul><ul><li>Users </li></ul>Which uses are illegal on the Internet?
  3. 3. The music market in the digital age: the legal environment <ul><li>The main legal objectives for the development of the European on-line music market: </li></ul><ul><li>Adapting rights’ licensing to the Internet </li></ul><ul><li>Clearing what acts are illegal when using music on the Internet </li></ul>
  4. 4. <ul><li>Clearing the boundaries of rightholders’ authorisation of exploitation </li></ul><ul><li>For which uses did rightholders give their authorisation? e.g. downloading and/or streaming and/or podcasting?… </li></ul><ul><li>Clearing the modes of rights’ management </li></ul><ul><li>Individual/collective rights’ management; compatibility of collective management with « alternative » rights’ licences ( e.g. Creative Commons) </li></ul><ul><li>Towards an European « one-stop shopping » for on-line exploitation of music ? </li></ul><ul><li>- Fading of territorial boundaries on the Internet  need of multi-territorial / multi-repertoires licences </li></ul><ul><li>- The main issue at stake: competitivity of the European on-line music market </li></ul>Adapting rights’ licensing to the Internet
  5. 5. <ul><li>Initiatives of rightholders: </li></ul><ul><li>- Santiago Agreements (authors’ performance rights; model agreement expired; EC Commission issued Statement of Objections ) </li></ul><ul><li>- Barcelona Agreements (authors’ mechanical rights) </li></ul><ul><li>- IFPI simulcasting Agreement (recording producers’ right to make available) </li></ul><ul><li>Other n ew initiatives: </li></ul><ul><li>- MCPS-PRS/Gema-EMI Music Publishing deal </li></ul><ul><li>- MCPS-SGAE eLOS joint venture </li></ul><ul><li>- SABAM-BUMA alliance initiative </li></ul><ul><li>- The French legislative episode of the « global licence » </li></ul><ul><li>The issue of mandatory collective management; the WIPO/Hungary precedent </li></ul>Adapting rights’ licensing to the Internet
  6. 6. <ul><li>Complaints of RTL (2000) and of Music Choice (2003) against CISAC to the competition authorities of the European Commission </li></ul><ul><li> Commission Recommandation on collective cross-border management of rights for on-line music services (adopted on 18 May, 2005, published in October 2005) </li></ul>Adapting rights’ licensing to the Internet
  7. 7. Adapting rights’ licensing to the Internet <ul><li>How to conciliate competition law and collective management? </li></ul><ul><li>The Perspectives following the EC Recommandation: </li></ul><ul><li>Transition between 3 models of multi-territorial / multi-repertoires licences </li></ul>
  8. 8. Adapting rights’ licensing to the Internet <ul><li>Model 1 </li></ul>Collecting society Country 1 X 24 societies = 24 reciprocal agreements 24 reciprocal agreements x 25 Member States’ societies = 300 reciprocal agreements minimum! <ul><li>Classical system of reciprocal agreements (territory by territory basis) </li></ul><ul><li>« intra-European » but not « pan-European » system </li></ul><ul><li>Users’ model </li></ul>
  9. 9. Adapting rights’ licensing to the Internet <ul><li>Model 2 </li></ul><ul><li>- Classical system of reciprocal agreements (territory by territory basis) </li></ul><ul><li>but limited to a reduced number of collecting societies </li></ul><ul><li>e.g. IFPI Simulcasting Agreement (no more consumer allocation clause) </li></ul><ul><li>- Users’ model </li></ul>
  10. 10. Adapting rights’ licensing to the Internet <ul><li>Model 3 </li></ul><ul><li>- Rightholders’ model </li></ul><ul><li>Rightholders choose one collecting society or licensing platform responsible for the administration of their rights for the whole European territory </li></ul><ul><li>( e.g. MCPS-PRS/Gema-EMI Music Publishing deal) </li></ul><ul><li>e.g.  : creation of 3 licensing platforms </li></ul><ul><li> only 3 agreements between collecting societies </li></ul>
  11. 11. Adapting rights’ licensing to the Internet <ul><li>Competition among collective management societies: </li></ul><ul><li>the pros and the cons </li></ul><ul><li>The cons: </li></ul><ul><li>- Risk of tariffs’ « dumping » </li></ul><ul><li>- Risk of creation of different  « classes » of music repertoires (incidence on cultural diversity) </li></ul><ul><li>The pros: </li></ul><ul><li>- In a short term: competitivity of European on-line music market </li></ul><ul><li>- Inducing collecting societies to improve their management systems </li></ul>
  12. 12. What acts are illegal when using music on the Internet? <ul><li>Normative context: Towards a greater protection of rightholders? </li></ul><ul><li>2001 Information Society Copyright Directive </li></ul><ul><li>2004 Enforcement Directive (implementation deadline passed April 29, 2006) </li></ul><ul><li>Criminal sanctions Directive Proposal (July 2005) </li></ul>
  13. 13. What acts are illegal when using music on the Internet? <ul><li>Protection of Technical protection measures (TPM) </li></ul><ul><ul><li>Legal basis: </li></ul></ul><ul><li>1996 WIPO Treaties: WTC (Art. 11) and WPPT (Art. 18) </li></ul><ul><li>2001 Information Society Copyright Directive (Art. 6) </li></ul><ul><ul><li>Sanction of TPMs’ circumvention: </li></ul></ul><ul><li>- circumvention acts </li></ul><ul><li>- manufacturing and offering to the public technical means allowing TPMs’ circumvention </li></ul><ul><li>- Beyond the reproduction and performance rights? </li></ul><ul><li>e.g. British Copyright Act limits MTPs’ protection only to the MTPs ensuring legal rights’ protection </li></ul>
  14. 14. What acts are illegal when using music on the Internet? <ul><li>Technical protection measures v. private copying? </li></ul><ul><ul><li>The role of the « three-step-test » </li></ul></ul><ul><ul><li>(Bern Convention, Art. 9; 2001 InfoSoc Directive, Art. 5.5): </li></ul></ul><ul><li>«  The exceptions and limitations provided for (…) shall only be applied in: </li></ul><ul><li>- certain special cases </li></ul><ul><li>- which do not conflict with a normal exploitation of the work or other subject-matter and </li></ul><ul><li>- do not unreasonably prejudice the legitimate interests of the rightholder.  » </li></ul><ul><li>Can the « three-step-test » be applied by the national judge? </li></ul><ul><li>e.g. French case law: Cour de cassation , 28 February 2006 ( Mulholland Drive ) </li></ul>
  15. 15. What acts are illegal when using music on the Internet? <ul><li>The P2P issue </li></ul><ul><ul><li>The inner paradox of P2P: </li></ul></ul><ul><ul><li>Downloading </li></ul></ul><ul><ul><li>Making available </li></ul></ul><ul><ul><li>Coincidence of actions </li></ul></ul><ul><li>Reproduction right </li></ul><ul><li>Making available right </li></ul><ul><li>Fading of frontiers between rights </li></ul>Acts of P2P users Authors’ and neighbouring rights <ul><li>The P2P issue </li></ul><ul><ul><ul><li>The legitimacy of the sources of downloaded files </li></ul></ul></ul><ul><ul><ul><li>e.g. German Copyright Act  </li></ul></ul></ul>
  16. 16. What acts are illegal when using music on the Internet? <ul><li>The P2P issue </li></ul><ul><ul><li>The liability of P2P software manufacturers </li></ul></ul><ul><ul><li>Case law condemning defendants of indirect (either vicarious or contributory) copyright infringement </li></ul></ul><ul><ul><li>e.g. Australia, Sharman case (Federal Court of Australia, 5 Sept. 2005) </li></ul></ul><ul><ul><li>US, Grokster case ( American Supreme Court, 27 June 2005 ) </li></ul></ul><ul><ul><li>Netherlands, Kazaa case ( 19 December 2003 ) </li></ul></ul><ul><ul><li>The legislator’s dilemma: how to conciliate legal sanction and technical innovation? </li></ul></ul><ul><ul><li>e.g. French debate </li></ul></ul><ul><ul><li>Rightholders initiatives </li></ul></ul><ul><ul><li>e.g. EMI agreement for P2P distribution: « Qtrax » (US) </li></ul></ul>
  17. 17. The on-line music market and its users <ul><li>The « interoperability » issue </li></ul><ul><li>The importance of a good merchant policy for on-line music services </li></ul>
  18. 18. Interoperability <ul><li>The position of the French legislator </li></ul><ul><li>Which regulation: law or competition? </li></ul>
  19. 19. For a good merchant policy of on-line music services <ul><li>The price issue </li></ul><ul><li>Choice of the law applicable to the contract </li></ul><ul><li>On-line services’ liability vis-à-vis users </li></ul><ul><li>e.g. Legal action brought by the Norwegian consumers’ association against iTunes </li></ul>

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