EU copyright levies system to be overhauled

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BRUSSELS -- European Union internal market commissioner Charlie McCreevy confirmed Wednesday his plans to overhaul the system of copyright levies on consumer goods that currently compensate artists in Europe.

The commissioner -- who is due to publish recommendations on the controversial levies next month -- told an audience in Brussels that the system was opaque and distorted the EU's single market.

"We are concerned that the operation of some current schemes for fair compensation may be disruptive to trade in the internal market and whether full account is being taken of the increased use of technological means to protect copyrighted works," he said.

The commissioner's draft recommendation 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 draft proposal -- which is still being debated and amended by the Commission's services -- balks at actually scrapping the levy, instead calling for an overhaul of the diverse copyright collection systems in the EU's different member states.

Copyright levies are used to compensate artists in 20 of 25 EU member states. They skim a fee off the price of any DVD recorder, MP3 player and blank disk sold on the legal basis these will be used to make unlicensed private copies.

McCreevy said the collecting societies that gather the fees had to open up their operations. "We also feel that greater clarity and accountability in how these funds are managed and distributed would be greatly in the interests of all concerned," he said.

He also dismissed critics who said his approach threatened the EU's cultural diversity. "There are some who pit culture against commerce. Who see any change as a zero-sum game. Such simplistic arguments are as damaging as they are wrong," he said, adding that Europe should stop "looking on change with profound suspicion." He also said that the 150-year-old network of artists' trade unions should be more "open to change."

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. It argues that artists' groups have not legally demonstrated that private copies harm artists.

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, while Germany has a levy of €2.7 ($3.4) on the same product and the Netherlands and Belgium impose no levy at all.

Mark MacGann, director general of EICTA, the European information and communication technologies association, said he was not asking the Commission to abolish the levies.

"We just want them to be fair, not just for the industry, but for consumers," he said. "Consumers pay royalties on three different occasions when they buy music online.
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