Ancillary Copyright for Press Publishers

Copyright law reform in the EU is a widely debated topic with hardened fronts. In addition to the provisions contained in the draft law about upload filters, a major reason for this is the ancillary copyright law requirement for press publishers. While many publishers see the new law as restoring their rights in what they deem to be a legal vacuum, critics fear that freedom of information and communication on the Internet will be restricted. After the crash landing and the lack of majorities in the first vote, the EU states, the Commission and Parliament have now agreed on a final reform text and finally adopted it. So what is it about ancillary copyright law that creates such controversy and what are the arguments for and against it?

Copyright law reform (previous EU regulations on copyright date from 2001) in the digital online market has been the subject of many, often heated, discussions. Articles 11 and 13 of the new draft law are the particular focus of public attention. The latter is now called article 17 and is meant to oblige online platforms to check content for copyright infringements before it is published. However, critics suspect this may lead to the use of upload filters. Article 11, on the other hand, directly concerns ancillary copyright for press publishers.

The final vote was preceded by major protests. More than 100,000 people took to the streets against the reform and Wikipedia in Germany switched off part of the online encyclopedia for a day. The EU Parliament nevertheless decided to adopt the copyright reform: 348 MEPs voted in favor. On the other hand, there were 274 MEPs who voted against, and 36 abstained. After the approval of the European Council – a mere formality – the member states now have two years to translate the directive into national law.

In July 2018, under great public interest and scrutiny, the EU parliament voted on the draft and rejected it. Changes were made following this, most noticeably with the removal of the term ‘upload filter’, and two months later parliament once again voted on it. In the second vote, the draft was passed with 438 votes in favor, 226 against and 39 abstentions.

However, the law had not yet been passed because the draft needed to pass through “trilogue negotiations” first. Representatives from the EU Parliament, the EU Commission, and the Council of Member States had to negotiate the final version. On the evening of Wednesday February 13^th, negotiators representing the European Parliament and negotiators representing the different EU member states finally agreed on a draft regulation of the new copyright law. Controversially, Articles 11 and 13 were agreed to be included, creating both a wave of support and backlash from the community. The agreed upon legislation had to be passed by the European Parliament.  However, there was widespread protesting, including an online petition against the legislation that was signed by several million people.

Ancillary copyright (also known as the link tax) is intended to protect publishers from their published texts or parts thereof being made available on other sites free of charge. The law therefore stipulates that, in the future, website operators will have to pay publishers if they collect editorial content from the internet and link it to a headline or a short preview (“teaser”) on their page.

For example, if you search for an event on Google News, the search engine will show you numerous articles from different online newspapers. They have not actually written this content, instead the search engine finds the texts on the internet and uses them to compile search results that are then displayed to you. In fact, this can also be seen as an advantage for the individual newspaper publishers, as the search results link directly to their websites, subsequently attracting more readers and generating even higher advertising revenues.

Google also integrates headlines and entire sections of texts into the preview. For this reason, publishers fear that many users will be content to just read the Google overview and won’t continue reading the rest of the article on their own website. This means that only Google get advertising revenue without having to produce any content of their own.

Aside from Google, there are plenty of other sites that collect content, display a teaser and then link from an external site. Examples of these aggregators are:

• Yahoo News
• Rivva
• Newstral
• Flipboard
• Any kind of RSS reader

The wording of the final agreement is considered questionable by critics. The EU Parliament’s position, for example, is that when an article is linked, the complete title or teaser (section of the text) cannot be used by the copyright holder without a corresponding license. However, the hyperlink itself and individual words should remain legal even without consent. It is still unclear how many words will be allowed.

Restricting the law to commercial providers also raises questions. According to the law, research purposes and private use should be exempt from licensing. However, it remains unclear what ultimately counts as private use. Some critics fear that this would only affect links that are not visible to the general public. In this scenario, for example, non-commercial bloggers would also have to obtain the press publisher’s permission (with possible fees required) before they publish a link including a heading. Other observers wonder whether sharing an article on Facebook or Twitter can actually count as private use. Despite the text being shared by a private individual, it is happening on a commercial platform that would remain the beneficiary even in that case.

While one can take action against the unauthorized publishing of entire articles thanks to copyright guidelines, this does not apply to short text passages and headlines integrated in preview mode. So far, publishers, editors and authors have been unable to take action against this kind of exploitation. It is precisely this gap that the ancillary copyright law for press publishers intends to close. Aside from text content, it also affects thumbnails from the publisher used in articles.

Opinions on ancillary copyright differ: in Germany where this law is already in place, several large publishers and the Federal Association of German Newspaper Publishers are among those in favor of the law. However, Internet companies, network activists and different online and media organizations and associations have come out against the link tax. Similar trends in support and resistance have been seen across the EU at the proposed block-wide legislation.

Many publishers argue that their intellectual property on Google or other search engine pages is insufficiently protected. In contrast to the film and music industry, there is a gap in protection for editorial contributions. This is used by internet portals and aggregators. They take away important advertising revenues from publishers and are partly responsible for the rapid decline in newspaper and magazine sales. This in turn threatens independent, high quality journalism.

Opponents of ancillary copyright note that publishers already have all options available to them to protect their content from being used by aggregators. On the one hand, copyright also applies to editorial texts; on the other hand, it is possible to regulate inclusion in Google’s directory without a lot of effort, or prevent it entirely. For example, this can be achieved by integrating a robots.txt-file on the web server.

In their opinion, ancillary copyright for press publishers is just a link tax that only large publishers benefit from, with actual authors and journalists missing out on the revenues. The obligation to pay publishers even for small pieces of text and headlines also restricts freedom of information and communication and puts smaller content producers like bloggers or freelance journalists at a disadvantage.

Some publishers themselves are also opposed to an EU-wide ancillary copyright law. They see Google and other aggregators as important channels through which numerous visitors become aware of their articles. The advertising revenues generated by visitors channeled through Google have become indispensable.

Ancillary copyright law was introduced in Germany in 2013 and is still valid. However, not a lot has actually changed, as many publishers have paid more in legal costs than they have ever received in license payments. Google, on the other hand, has received free licenses from many publishers to continue collecting and linking their content free of charge. Less popular aggregators, on the other hand, were confronted with problems that they could barely solve. In many cases, they had to change or discontinue their business model. The main beneficiaries have been large corporations, whose market power should be restricted by law.

Aside from Germany, Spain is the only other EU country to have adopted ancillary copyright laws. Their link tax went a step further than in Germany, removing the option for publishing companies to waive fees and allow news aggregate sites to feature their content for free in exchange for links. This had serious consequences for small providers of Spanish news – small providers and independent bloggers had their livelihoods effectively wiped out. Legal gray areas forced them to abandon their businesses, or radically change their innovative business models. On an even larger scale, in 2014, Google News decided to shut down operations in Spain as a result of the legislation in question. While other aggregates like Yahoo and Rivva still operate in Spain, the outcome of these changes led to an estimated €10 million (close to $12 million) in losses per year for the publishing industry.

Many advocates of the EU Performance Protection Act believe that the problem with these national laws lies in how small the respective markets are. Germany which has 82 million inhabitants, or Spain which has 47 million, are just not relevant enough for large corporations like Google. A common European law would change this.

The introduction of ancillary copyright in the EU could have several consequences: it will most certainly reduce the amount of information available to people inside the EU, either because Google and other aggregators restrict their news, or because smaller magazines and bloggers lack the ability to link content free of charge.

Past experience shows that link taxes are most likely not the best way to protect independent and diverse journalism – in many cases, even the opposite turned out to be the case, and newspapers lost revenue. Critics not only warn against excessive bureaucratization of the internet but also of large media groups gaining and consolidating power through this law. In their opinion, restricting link texts also inhibits free opinion exchange on the internet.

The US currently has no plan to implement ancillary copyright laws. The vast majority of major news publishing companies in the US have installed a paywall for their content, so their headlines and snippets are inaccessible to the wider public regardless. However, the American public are as dependent on the internet as the European public, and any restrictions in freedom applied in one part of the world can have knock on effects in another. Any US citizens living abroad in the EU could be affected by a link tax. Even Americans who live in the US and regularly consume European news coverage, either out of an interest in international events or in an attempt to bypass the plethora of paywalls found in US news media, could be affected by an ancillary copyright law. At a time when internet freedoms are being eroded in the US with the repeal of net neutrality in June, the issue is a hot topic in the mind of both Americans and Europeans. Most individuals believe that the interests of the public are best served by a free internet with equal access for all.

Click here for important legal disclaimers.