EU governments don’t have to impose a levy on blank media to compensate copyright holders for losses from private copies, the European Court of Justice has decreed. It’s actually perfectly lawful to compensate them from a general fund, as Spain and Finland do, an opinion from Advocate General, Maciej Szpunar, clarified today.
It paves the way for the UK to “legalise home taping” without imposing a levy on gadgets or media - after its shambolic earlier attempt to introduce the copying exception was ruled unlawful in July.
The EU stipulates in Paragraph 35 of the InfoSoc Directive that member states can introduce an exception to copyright for private copies of legally acquired media, so long as the copyright holder is compensated in some way. You’d think that’s clear enough - set up a pot of money and pass the long overdue law. But the UK government chose to interpret it differently, arguing that the law didn’t mean what it said, and embarked on a costly and high risk legal defence of not paying musicians. Compensation wasn’t actually required at all, the UK argued. If you recall, the UK then chose to defend its faulty reasoning in the High Court, at the taxpayer’s expense. The attempt was (predictably) ruled unlawful last year. We don't care how - pay up.
The Directive doesn’t stipulate how fair compensation should be funded. Several countries draw the compensation pool from the state's general fund, rather than impose an unpopular additional levy on consumers. Countries that have done it this way include Estonia, Norway, Finland and Spain. Two copyright collecting societies in Spain challenged the general fund method as incompatible with the Directive. The Court rejected their argument today that this was unfair, with Szpunar pointing out that taxes aren’t usually hypothecated anyway, so this is no less “unfair” than any other tax. For example, if you don’t have children, you must still pay for schools.
“There is no link between the taxes paid by taxpayers, including those who, like corporations, cannot benefit from the exception [on] private copying, on the one hand, and the financing of compensation under this exception from the general budget of the State, on the other. It would be different only if a tax or a specific tax were introduced for the purpose of this funding, but this is not the case of the Spanish system at issue,” he wrote (our translation).
Perhaps thinking that the UK has already left the European Union, the Court has so far failed to produce an English translation of the ruling, although it managed to provide translations in 17 other languages including Maltese, Slovak and Lithuanian.
The ruling doesn’t change the law, but merely makes the “general pot” alternative to a levy more bulletproof.
The UK can now bring in the exception by passing the law along with a provision for a small pot of money. This is seems reluctant to do, in contrast to the way it flings the cash at other recipients, such as internet VCs. For example, Passion Capital was given £17m of taxpayers' money last year, which is great news if you're a dog walking startup. Global "human rights initiatives" get over £10m a year, to choose an another example at random.
The only reason the UK government can now offer for not fixing the law is general misanthropy - or perhaps a specific hatred of musicians. Neither reason makes it looks good. ®