Cross-border collective copyright management (debate) 
President
The next item is the debate on the oral question to the Commission on the follow-up of the EP resolution on cross-border collective copyright management (Lévai report, by Giuseppe Gargani, on behalf of the Committee on Legal Affairs - B6-0381/2007).
Cristian Dumitrescu  
author. - (FR) Mr President, ladies and gentlemen, on 13 March 2007, in plenary session, the European Parliament adopted a resolution on the Commission's Recommendation of 18 October 2005 on collective cross-border management of copyright and related rights for legitimate online music services.
In that resolution, Parliament invited the Commission to make it clear that the 2005 Recommendation applied exclusively to online sales of music recordings, and to present as soon as possible - after consulting closely with interested parties - a proposal for a flexible framework directive to be adopted by Parliament and the Council in codecision, with a view to regulating the collective management of copyright and related rights as regards cross-border online music services, while taking account of the specificity of the digital era and safeguarding European cultural diversity.
Parliament also stressed that the proposed directive should not in any way undermine the competitiveness of creative businesses, the effectiveness of the services provided by collective rights managers (CRMs) or the competitiveness of user businesses - in particular small right-holders and users - and that it should, on the other hand, guarantee right-holders a high degree of protection and equal treatment; ensure that the relevant legal provisions had a real, significant and adequate impact; emphasise the use of alternative dispute resolution; provide for democratic, transparent and accountable governance in CRMs; promote creativity and cultural diversity; allow only fair and controlled competition without territorial restrictions, but with the necessary and suitable qualitative criteria; take into account the interests of users and of the market; satisfy the future needs of an online market; and foster the development of legitimate online music services.
Today the European Parliament is asking the Commission what steps it has taken towards meeting the expectations enshrined in that resolution.
Joe Borg
Member of the Commission. - Mr President, I would like to thank the European Parliament for the interest expressed in the cross-border management of music rights and the 2005 recommendation on online music. The Commission's 2005 online music recommendation aims to allow the music market in Europe to develop in the digital environment. It aims to create a framework in which the best new online licensing model will emerge by agreement between the market players. This should allow authors, composers and music publishers to get a fair share of the distribution of their online works.
The recommendation does not prescribe a particular EU licensing model, and leaves implementation of its principles to the market. Exactly two years after adoption of the recommendation, the Commission is assessing the development of online licensing practices in the music sector in Europe. Stakeholders were invited to comment on emerging online licensing trends by 1 July 2007. The Commission received 88 replies from interested parties, such as collecting societies, authors, creators and music users in Member States. The process of reviewing the submissions is still ongoing. Only after a thorough examination will the Commission assess further policy steps regarding the online operations of collecting societies. The submissions analysed so far show that most stakeholders do not see the need for a framework directive, and prefer market-based solutions to regulatory intervention.
On the question of whether the 2005 recommendation is limited to online sales of some recordings, the Commission would like to point out that the principles on transparency and governance set out in the recommendation should not be limited to online music sales and should apply to all the activities of collecting societies.
To conclude, while the online market for music is still in flux, legislating in favour of a particular licensing model would appear premature. The Commission will monitor developments and report back to Parliament and the Council as foreseen in the recommendation. Any follow-up, if necessary, will be closely coordinated with the European Parliament and the Council.
Manolis Mavrommatis
Mr President, on 13 March 2007 the European Parliament passed a resolution on collective cross-border management of copyright.
In its resolution, Parliament called on the Commission to waste no time in presenting a proposal for a framework directive regulating collective cross-border management of copyright and related intellectual property rights for legitimate online music services. It also called on the Commission to make it clear that the 2005 recommendation in this area applies exclusively to online sales of music recordings.
Can the Commission update Parliament on the measures it has taken to date, in response to Parliament's requests?
Can the Commission inform Parliament whether it is following the same guidelines and instructions issued by President Barroso on the unified, democratic, rapid development of a united Europe? When will the Commission respect Parliament's procedural rules and the position adopted by the majority of its 785 Members?
The 13 March resolution reflects the European Parliament's clear position on cross-border collective management of copyright. The Commission's recommendation was the first step towards future convergence of the various practices in the 27 Member States. On behalf of the Committee on Culture and Education, I myself argued, in my opinion for to the competent Committee, in favour of the importance of ensuring equal treatment for all right-holders, whether writers, composers, editors, record producers or performers.
In other words, this is an issue concerning millions of right-holders throughout Europe. The situation today, as regards online services is not considered to be effective enough, either for rights users, or for right-holders. We have thus all worked to present the Commission and the Council with the proposals that we believe would bring about a change for the better in the collective management of copyright.
The close cooperation between rights managers must be retained for the benefit of all parties. Piracy remains the greatest problem facing the music industry today. Three of the reasons for the spread of piracy internationally are the technological facilities for low-cost illegal copying, unfavourable economic conditions and the expansion of the Internet.
We shall all have to bear in mind that the spread of music piracy has the greatest impact on small countries where the music industry is mainly of a local and regional nature. In specific terms, piracy entails a shrinkage of the legal music market and results in a decline in legal sales; it therefore affects the viability of the national music recording industry.
Piracy certainly entails copyright losses for composers and songwriters, but it also deprives the state of income tax and VAT. The fight against piracy must therefore be included among the Commission's initial aims in the possible legislative proposal on collective management of copyright.
I would therefore like to call upon the Commission to take steps, as soon as possible, to fulfil Parliament's requests and to present a proposal for a framework directive with a view to regulating the collective cross-border management of copyright.
Lastly, as I have always said, music is not a commodity, and it is the duty of us all to protect and strengthen creativity in Europe. A directive that will in all likelihood not come into force until 2010 is a disaster for millions of artists in the EU.
Katalin Lévai
on behalf of the PSE Group. - (HU) Thank you very much. I would like to emphasise that this is about an extraordinarily important area, since income from goods and services protected by copyright and related rights accounts for 5-7% of the European Union's GDP. This highlights the importance of such rights being managed appropriately.
As you know, in 2005 the European Commission adopted a Recommendation on the cross-border management of legitimate online music services. At the time, Commissioner McCreevy described the Recommendation as 'a "soft-law instrument” designed to give the market a chance to move in the right direction'.
The Recommendation has far-reaching consequences for the copyrights market and major players in the market are already acting on the basis of it. It clearly goes further than merely interpreting and supplementing existing rules and its impact has all the characteristics of a full regulatory initiative.
At the time, a lot of fear took hold in connection with this Recommendation, including the fact that it would result in uncontrollable competition and that market forces would be concentrated in the hands of a few big management societies, and monopolies would be created. This is precisely why I thought that I should make a recommendation in an own-initiative report for the online music market to be regulated in a different way.
All the same, the Recommendation - which the Commission adopted - deprived the European Parliament and the Member States of the opportunity to have any significant influence on the changes affecting competition and cultural diversity in Europe.
It is precisely for this reason that I have been able to win the support of the whole Parliament and all the political parties for my report, in the interests of bringing to fruition a decision-making triangle, so that Parliament cannot be left out of the legislation of such an important area, and I have recommended that the Commission draw up a framework directive.
In my opinion, this recommended directive must meet the following requirements: it must guarantee right-holders a high degree of protection and equal treatment. It must be based on solidarity between right-holders and on an appropriate, fair balance among management societies. It must provide for democratic, transparent and accountable governance in management societies, including organisational structuring, transparency, representation, rules relating to copyright and production, and accounting, through minimum standards.
Comprehensive transparency must be ensured in collective management societies. Creativity and cultural diversity must be promoted. Fair and controlled competition can be allowed, without territorial restrictions, but with the necessary and suitable qualitative criteria for the collective management of copyright and the preservation of the value of the rights.
A high degree of legal certainty must be provided for users, and the availability of the global repertoire must be preserved. We, or I, therefore ask you to think about whether a directive would be necessary for regulating this important area.
Manuel Medina Ortega
(ES) Mr President, Commissioner Borg's reply to the question put by Mr Dumitrescu fills me with concern: the Commissioner spoke of leaving the matter in the market's hands. But what is it we are talking about?
We are talking about rights which have taken two centuries to evolve: rights of creators, authors, composers, artistes. And now we are being told that those rights are to be regulated by the market: by what market? The market of thieves, the market of people who have divested producers and creators of their intellectual property by using new means of communication? What sort of rights are we talking about?
Rights are regulated by public bodies; specifically in the European arena we have institutions, namely the Commission, the Council and Parliament: the Commission with its power of initiative, the Council and Parliament through the codecision procedure.
It seems to me that now is not the time to follow a path which will lead to the disappearance of intellectual property. And if intellectual property disappears, intellectual creation disappears as well.
Some of the wise men and women who talk to us today about the advantages of the information society say well, yes, composers and authors can wander the streets giving concerts like in the Middle Ages. Are we going to reduce our authors to medieval minstrels who can play in the middle of the street, with a cap on the floor hoping someone will give them alms?
I think now is the time for the institutions of the European Union to react vigorously to defend this European tradition; its political essence is very important and it is vital for the maintenance of intellectual creativity. Only through societies of authors, the collective management of those societies, can intellectual property rights and the creation of intellectual property be defended today, right now, against the real thieves in the form of broadcasting companies which use intellectual creativity for their own benefit.
Lidia Joanna Geringer de Oedenberg
(PL) Mr President, the response to the Commission's Recommendation on collective cross-border management of copyright for legitimate online music services was provided by Parliament's Resolution that a framework directive be introduced to regulate this issue. However, the Commission did not carry out the necessary and wide-ranging stakeholder consultation that was required, including with Parliament, which was a breach of democratic procedures. It is completely unacceptable to ignore the institutional triangle and instead apply the so-called soft law approach without prior consultation and without the formal involvement of Parliament and the Council in the matter.
This recommendation, which aims in practice to create more freedom for copyright owners to select the institution that provides collective management, depending on requirements, would have far-reaching consequences for the copyright and related markets and would create a potential threat not just to competition rules, but also to cultural diversity. As a result, market power would be concentrated in the hands of a few of the largest entities that will then be able to bypass the network of bilateral agreements and grant licences to the whole European market.
It is worth remembering that about 5-7% of the EU's GDP comes from the sale of goods or services that are protected by copyright and similar laws. This fact illustrates even more how important is proper management of the relevant rights, as well as the need to strengthen their position in the current digital era. While respecting the principles of competition, we should avoid reducing the income of composers, at the same time providing users of musical works with an EU-wide licence that corresponds to the business model of the future. With this in mind the Commission should, as soon as possible, submit a proposal for an appropriate instrument that would be legally binding on entities working in this area.
Joe Borg
Member of the Commission. - Mr President, first of all I would like to thank all the Members who spoke for their comments, which I will certainly convey to my colleague, Commissioner McCreevy.
If I can pick up on a number of points that have been raised: regarding the need for legislative intervention, let me say that the 2005 Commission recommendation on online music licensing has already brought about significant progress in the marketplace. The recommendation has given collecting societies in Europe an incentive to set up EU-wide licensing platforms that make their repertoire available for online music shops across Europe.
Let me cite three relevant examples. The UK and German societies have set up a platform for EU-wide licensing of the EMI repertoire, CELAS. The UK and the Spanish societies are cooperating on a platform that will manage the Anglo-Hispanic repertoire at EU level, and the French and Spanish societies have announced a joint licensing platform that grants EU-wide access to the French-Hispanic repertoire. In these circumstances, the Commission does not see the need for any premature legislative intervention.
I would also like to say that the 2005 Commission recommendation on online licensing has already brought about significant progress in the marketplace. The recommendation has encouraged collecting societies in Europe to set up EU-wide licensing platforms that make their repertoire available for online music shops across Europe. I refer to the three examples I have just mentioned. The CELAS joint venture alone is in fact in a position to license approximately 25 % of all musical works to any European online music retailer, such as iTunes, Sony's CONNECT or eMusic, in a single transaction.
On the question of cultural diversity, let me state that our recommendation is not detrimental to cultural diversity. There are clear indications that the new platforms for Anglo-American, French or Spanish music are open platforms. These platforms can include other music publishers' repertoires or the entire repertoire of existing societies.
National collecting societies would not disappear; authors would still be members of local collecting societies and revenues would still be distributed through collecting societies affiliated to the new licensing platforms.
Regarding the issue of rights, I would like to underline that there is no reason to think that this multiterritorial licensing model is bad either for cultural diversity or for the rights of artists, while it is good for the rightholders, who get more money than under the old territorial model. Cultural diversity and the rights of artists are also about giving authors more money so that they can continue to create.
Let me make one last point. The Commission actively encourages the development of an own online licensing market for music. In this vein, the Commission will closely monitor developments in this emerging market and, in doing so, the Commission will carefully consider the issues raised in the Lévai report of 5 March 2007.
If, between now and 2010, we observe, for example, that monopolistic licensing structures are emerging on the Internet, that the repertoire available on the Internet does not adequately reflect Europe's cultural diversity and that the marketplace alone is not delivering EU licensing structures that are adapted to the Internet era, then the Commission will consider adequate alternative means for reaching those objectives.
President
The debate is closed.
The vote will take place on Thursday, 29 November in Brussels.
Written statements (Rule 142)
Jacques Toubon  
in writing. - (FR) The purpose of Mr Dumitrescu's question is to remind the Commission of its responsibilities. Through its recommendation of September 2005 and its decision to call into question the territorial competence of CRMs, the Commission has upset the relationship between rights-holders and national collecting societies - and this has happened outside the context of any legislation or harmonisation measures.
Under the guise of adaptation to the digital environment, the Commission has introduced confusion into the European system of author's rights and related rights. That in turn has encouraged concentration and a format-based approach, to the detriment of artists and to the advantage of industrialists and other economic operators.
The Commission urgently needs to stop taking random initiatives without serious assessment of their impact; it needs to examine the situation in all the arts and cultural sectors, in conjunction with all the stakeholders, and to adopt a comprehensive policy that will reflect the requirements of cultural diversity, as well as Europe's values and the Lisbon Strategy objectives based on the knowledge and innovation economy; and it needs to present Parliament and the Council with coherent draft directives respecting the principles that I have mentioned.
