European Film Industry Reacts to Digital Single Market Proposals

European Commission Vice President Andrus Ansip

The European Commission has unveiled major changes to digital distribution and copyrights law aimed at creating a single digital market across all 28 EU countries.

European politicians have spent nearly a year crafting new legislation aimed at breaking down barriers to online trade between the 28 countries of the European Union and create a single, digital market.

But despite months of fact-finding, consultation and negotiation, the plans, unveiled by the European Commission Dec. 9, do not appear to satisfy critics, who claim the proposals could seriously damage the European film, television and music industries.

Among other things, the plan proposes getting rid of so-called geo-blocking to allow European consumers who have legally acquired films or television programs, via a service such as Netflix or BBC's iPlayer, access to their content when traveling outside their home country. More broadly, the proposals aim to harmonize European copyright law with the goal of creating “a single copyright code and a single copyright title” available across the entire region of some 500 million people.

European Commission vice-president Andrus Ansip, who presented the proposals Wednesday called them “another step that will bring Europe closer to a borderless digital economy and society.” The Commission estimates that the proposals will boost cross-border consumption in Europe by up to $19.6 billion (€18 billion) and raise overall GDP in the region by $4.36 billion (€4 billion).

But representatives of the European film industry still see the devil in the details of the Commission's plan and worry the new legislation could undermine the principle of territoriality: whereby filmmakers license their work on an exclusive basis country by country throughout Europe. Territoriality is the basis by which most European films are financed and exploited.

“Any intervention that undermines the ability to license on an exclusive territorial basis will lead to less investment in new productions and reduce the quality and range of content available to consumers,” warned John McVay, CEO of UK’s producers’ trade body PACT in a statement reacting to the Commission's proposals. “We want to continue to work with the EU institutions to ensure the proposed regulation for portability works for both consumers and industry. Unfortunately the current proposal falls far short of that goal due to inadequate safeguards to prevent abuse and a lack of clarity in key concepts.”

The Society of Audiovisual Authors (SAA), the Federation of European Film Directors (FERA) and the Federation of Screenwriters in Europe (FSE) issued a joint statement supporting the Commission's stated goal of improving the circulation of European works across the continent. But the groups criticized the Commission's push to harmonize EU copyright law.

“We do not understand the Commission’s long-term vision of a unified copyright title,” said Cecile Despringre, executive director of the SAA, “as if it was in its DNA to harmonize everything. This simplistic and bureaucratic vision is in clear contradiction with the EU’s political motto “United in diversity” which acknowledges exactly what the EU is about.”

Ted Shapiro, a intellectual property law expert with the Wiggin group based in Brussels, called the Commission's copyright proposals “an ambitious plan to make copyright more European at the expense of national laws,” arguing that the plan is “mostly about weakening exclusive rights and reducing contractual freedom through the steady erosion of copyright territoriality and the imposition of pan-EU exceptions.”

The Commission's proposals on portability of content and geo-blocking, if endorsed by the European Parliament and the Council of the European Union, will immeditely become law across the 28 EU member states.

Copyright reform will take longer. The Commission on Wednesday launched a public consultation to evaluate the current legal framework for intellectual property rights in the EU. A revision, and possible harmonization of copyright law across the EU, could follow by the end of 2016.

The European Commission has assured the European film industry that it plans to keep territoriality in place within a digital single market and will actively seek to promote European works within the EU. Among other things, the plan suggests developing a European aggregator of online search portals and online licensing hubs to promote the distribution of films outside their home territories. The Commission has also promised tough new anti-piracy measures to ensure only legal content easily crosses EU borders online.

But some think the Commission's plan doesn't go far enough. Julia Reda, a member the European Parliament for the Pirate Party, called the proposals “piecemeal” and said they “fail to properly dismantle digital borders” in the EU. 

“The proposed new rules on the portability of digital content only address a narrow spectrum of the problems faced by users. The proposals will clearly benefit those who have subscriptions to providers like Sky or Netflix and want to use them while abroad,” she said. 

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