EC to recommend scrapping copyright levies

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BRUSSELS -- The European Commission is expected to recommend that copyright levies imposed on consumer electronics in Europe be reduced to a minimum, saying they are often redundant in today's technological environment.

In a document obtained by The Hollywood Reporter, the EC says that consumers often are forced to pay copyright fees when they buy personal computers or MP3 players, and again when they download music legally online. However, the proposal balks at actually scrapping the levy, instead calling for an overhaul of the diverse copyright collection systems in the European Union's different member states.

The EC draft recommendation also encourages more efficient use of digital rights management and favors a lump sum annual payment from the consumer electronics industry rather than the levy.

The EC -- the EU's executive authority -- has launched an internal consultation on the document and should publish it before the end of the year. The latest draft states that "no obligation for further payment in another form may arise in relation to the private copying by the consumer" following an initial fee.

The consumer electronics companies say that slashing the levies could save hundreds of millions of euros every year for such companies as Apple, Siemens, Nokia and Sony on products ranging from iPods and DVD players to mobile phones and PCs.

The scope and extent of copyright levies varies from country to country. France, for example, applies a levy of €51 ($65) on an iPod with 4GB memory. Germany has a levy of €2.7 ($3.4) on the same product, while the Netherlands and Belgium impose no levies on iPods at all.

Paloma Pertusa, of independent record label lobby Impala, said the proposals effectively signaled the end of the levies. "It does not say so directly in the recommendation, but says so indirectly," she said. "This proposal obviously reflects the concerns of the ICT sector far more than of rights-holders."

The recommendation says that the levy system should be operated more openly and reflect the actual copying and piracy levels recorded by the industry, not levels that are merely speculated at. It also calls on EU governments to ensure that the amount of fees "takes into account the degree of use of a technological measure by comparing the licensed use with any other actual use on a sliding scale."

Mark MacGann, director general of EICTA, the European information and communication technologies association, said this was only a momentary pause in the campaign to end the levies.

"I can understand that the commission might feel that scrapping the levies is too much hassle right now, especially given the hysterical recent comments by certain artists about the issue," he said. "But this is a stepping stone, and the issue has gone beyond the point of no return. Once you accept that there can be no 'double dipping' -- no double payment for copyright -- then you accept that there should not be levies on legal content."

MacGann said he expects the levies to be gone in about 2-3 years. "Why should an iPod bought in France have a €51 copyright levy on it when it already has copyright protection measures to ensure legitimate content?" he said.
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