Reform of Spanish IP law: what is it all about?

Fidel Porcuna

A few days ago this Kat posted an item discussing proposed introduction into Spanish law of an ancillary right over news content, similarly to what happened in Germany and is currently being also considered in Italy.

Several Spanish Katfriends emailed to provide more information about this draft measure and inform the Kats that the creation of such new right would be just one of the several proposed changes that Spain is considering introducing into its IP system.

What are these changes all about? Katfriend Fidel Porcuna (Bird&Bird) tells us all. Here's what he writes:

"The long-awaited proposal for the reform of the Spanish Intellectual Property law was officially advertised on 21 February 2014 [which - incidentally - was also the same day as this Kat's birthday]. 

The preamble to the proposal explains that the reform is only partial, prompted by the urgent need to amend the current law on account of social, economic and technological changes. Early criticisms have focused on the need for the reform to be re-reformed, being sparkled with a vast number of non-legal concepts that are likely to give rise to uncertainty, be subject to quick obsolescence, and be biased for lack of overall credibility. 

However, here is a summary of the main points of the proposed law:

1.    Private copying

a.      Definition - The proposal restricts the scope of current exception under Spanish law.

·        To be considered as a private copy: a) the copy has to be made by an individual for his/her own private use; b) only from legitimately purchased works [this appears in line with AG Cruz Villalon's Opinion in Case C-435/12 ACI ADAM (not yet available in English!), on which see here] by means of legal sale or public communication (this means that rented and second hand copies are out of the definition, as well as copies made from private copies); c) such a copy must not be obtained unlawfully in establishments or public areas where the work was made available (eg the recording of a film made by a subject who has validly accessed a movie theatre by paying the ticket); and c) not be subject to collective or lucrative use. The definition has been criticised: "private use" as contained in the definition should not be relevant, since the CJEU in Case C-467/08 Padawan focused not on making the copy but on making the work available to individuals considered as users of certain reproduction equipment.

·        Current wording of the private copying exception does not include databases and software. Under the new proposal, works made available in such a way, eg by wire or wireless means, so that members of the public may access them from a place and at a time individually chosen by them will not be included either (eg downloadable works).

b.    Compensation. The Royal-Decree 20/2011, in force as of 1 January 2012, established that the compensation would no longer be obtained through a levy on reproduction devices but rather from the State budget (fixed at EUR 5m per each year 2012 and 2013), thus suppressing the collecting obligations for the industry. It may be difficult to determine now how this calculation would be made. A basic principle is to set a fair balance according to the harm caused to copyright owners as a result of copying by individuals for private use, but not for professional or business use. Regretfully, calculation and payment have been left for the implementing regulations to define. Objective criteria were nonetheless set by Royal Decree 1657/2012 in force as of 8 December 2012, whose draft was discussed here.

What non-insignificant
fragments are

2.    News Aggregators: an ancillary right

Providers using "non-insignificant" fragments of “information, opinion or entertainment” first published in newspapers or "websites periodically updated" [WOW: that's broad indeed ... What website is not regularly updated and does not contain information or opinions?] will trigger a right to an equitable remuneration. It is unclear what length is required [and so is the duration of this right?] for relevant snippets to be included in the definition of "non-insignificant" fragments. 

Publishers and other rightholders will be the beneficiaries of this right, which cannot be waived. 

Images (including photographs) shall be excluded from this ancillary right, meaning that news aggregators will have to require authorisation from the right owners to use them.

An important point is that search engines that provide results on the basis of searched terms that include the necessary information for such purpose and provide a link to the source will not be subject to this charge. 

A further condition for this right to apply is that communication of fragments does not have a specific commercial purpose. From the information that the Cabinet provided to the press, the ancillary right measure will primarily affect to aggregators that index and facilitate access to relevant content, thus excluding search engines or link providers. 

Stakeholders, including collecting entity CEDRO on the publishers' side, will have a max 8 months to reach an agreement regarding fees and calculation. Lacking such an agreement, an administrative body will determine the relevant amounts.

3.    Hyperlinking 

Reiterated linking to allegedly unlawful content might be subject to fines up to EUR 300,000 following at least two warnings from the competent administrative authority. The user will be sent a warning any time that - by linking to allegedly infringing content - he/she plays an "active role" as opposed to merely "neutral" one, and goes beyond a mere "technical intermediation" with the content provider. 

In particular, it will be considered an infringement to provide indexed lists of links to allegedly unlawful content, irrespective of whether these links have been provided by third parties. 

The proposal provides that the infringement, in order to be chased, must be "significant" (the criteria to distinguish between "significant" and "non-significant" are not provided though). One might wonder whether this is compatible with Case C-466/12 Svensson. The answer may not be clear, as the CJEU just focused on the "new" public requirement [but see some Kat-analysis on this point here].

I asked for the name of
that pesky infringer!

4.    Increased administrative powers against infringements

The "Sección Segunda de la Comisión de Propiedad Intelectual", sitting as the administrative body competent for the preservation and reinstatement of IPRs, will be able to bring proceedings against infringers and order the interruption of the infringing services, if necessary by requesting the cooperation of payment or advertising providers. Its powers will encompass ordering the cancellation of the gTLD under .es up to six months.   

5.    Reinforcement of measures to provide effective protection against infringements

The subject who is filing an action for copyright infringement will be able to request the competent court a preliminary order addressed at ISPs to have these disclose the alleged infringer's name and other identification means (this appears compatible with the Directive 2004/48 under the interpretation of the CJEU in C-461/10 Bonnier Audio). Use of this information is confidential and restricted to acts necessary to obtain effective judicial protection. 

6.    Finally, there is a set of provisions regarding transparency and good governance, social purpose and obligations of collecting entities, as well as strengthened administrative powers to control them. A regulation on the use of orphan works is included in the reform to implement Directive 2012/28/EU into Spanish law, along with implementation of Directive 2011/77/EU.”