Article 17 of Directive (EU) 2019/790 on copyright in the Digital Single Market (CDSMD) has been subject to much debate even before its enactment. The latest twist is the CJEU’s ruling in the Polish action for annulment of Article 17 CDSMD. Uncertainties about the precise and correct practical application of Article 17 CDSMD remain. The judgment, however, provides some clarity on how this norm must be transposed into national law to ensure compliance with fundamental rights, particularly with freedom of expression and information as enshrined in Article 17(2) of the Charter of Fundamental Rights of the European Union.

Compatibility of verbatim transpositions and why the German approach is ahead of the pack

Article 17 CDSMD is open to various interpretations – as has become clear during the hearings before the CJEU. While Spain and France argued that an implementation of ex post safeguards is sufficient to protect user rights, the CJEU later confirmed the position taken by the Advocate General and Member States like Germany that Article 17 CDSMD’s ex post safeguards must necessarily be supplemented by ex ante safeguards. These should address the danger of overblocking, that is the undue blocking of lawful content by OCSSPs before its dissemination in order to comply with the obligations from Article 17(4) CDSMD.

The judgment emphasises the need for ex ante safeguards against rampant blocking under Article 17(4) CDSMD. This fact, together with the obligation for Member States, when transposing Article 17 CDSMD, to strike a fair balance between the various fundamental rights, have raised doubts about the compatibility of verbatim transpositions. Other commentators have rejected these, arguing that minimal verbatim transposition is necessary to avoid impairing the harmonisation effect of the Directive.

The CJEU did not concern itself with national transpositions, but rather solely Article 17 CDSMD in its original version, and found an interpretation in compatibility with the freedom of expression. The CJEU held that Article 17(4) CDSMD is accompanied by appropriate safeguards. The judgment requires Member States to ensure an interpretation of national provisions that contains these safeguards.

As the judgment itself already identifies an interpretation of the Article in line with fundamental rights, the same must surely also apply to identical wording (i.e., copy and paste transpositions) in national law. This has to be the case as Member States are bound to interpret their laws in line with the CJEU’s interpretation. National courts, when interpreting national law, must have regard to the case law of the CJEU. Therefore, a conforming interpretation of verbatim transpositions should be ensured. As a consequence, copy and paste transpositions must be considered compatible with the judgment and the fundamental right to freedom of expression.

This does not mean, however, that this kind of implementation is the best in the face of freedom of expression and information. Instead, a more elaborative implementation, which provides more details on the delineation of permitted and prohibited ex ante blocking, should be the preferable way forward.

A conceivably elaborative implementation is the German version of Article 17 CDSMD, as it was transposed in the act on the copyright liability of OCSSPs (UrhDaG). One aspect of particular interest is the concept of a “presumed legal use”. In summary, Germany established a national additional ex ante safeguard for content which either qualifies as minor usage or is marked by the user as legally permitted. Under certain requirements, this content is presumed to be lawful and therefore cannot be blocked by automated means implemented by the OCSSPs. If rightholders contest this content, they have to initiate the complaint procedure, which may result in the content being taken down.

While there is an ongoing discussion about the compatibility of the German mechanism with the EU template, it is true that it dares to do something that had been missing from the EU Directive: it defines circumstances under which ex ante blocking is not possible.

The need for a definition of “manifestly infringing”

It has to be said that while this constitutes a step in the right direction, the current German provisions may not be the ultimate solution. Rightholders argue that even the unjustified usage of a film sequence as short as 15 seconds can significantly harm their economic interests, when only blocked after an ex post intervention. Nevertheless, the German transposition puts requirements in black and white for the design and use of automated content recognition (ACR) technology and automated blocking based on it.

In order to protect freedom of expression, it is important to be more specific about the requirements and circumstances under which automated ex ante blocking of content is permissible. One of the key points from the judgment in the Polish case is that for content to be blocked ex ante without freedom of expression being unjustifiably harmed, no independent assessment of its unlawfulness must be necessary. In other words, content needs to be “manifestly infringing”, which makes this term the central standard for determining whether the prevention of an upload was lawful or not.

Therefore, it should not be left to OCSSPs to determine when content is infringing enough to be regarded as manifestly infringing and can thus lawfully be blocked automatically. Rather, regulators should find ways to define requirements. This would not only provide clarity to users, rightholders and platforms, but deployed at the EU level it would also contribute to the harmonisation objective.

The implementation of the German legislator may serve as a starting point. However, it only defines circumstances under which automated blocking is not permissible, i.e., when manifestly infringing content is not present. Therefore, the law only gives a hint of a negative definition. A positive definition, which indicates when content can be blocked automatically, has yet to be found.

Implications of the judgment for the design of the complaint mechanism

In the context of national transpositions of Article 17 CDSMD, two remarks regarding current questions of implementation should be made.

The first concerns national provisions in respect of the complaint mechanism as set out in Article 17(9) CDSMD. From the judgment in the Polish case, we know that the complaint mechanism is considered as an additional (ex post) safeguard, which applies in “cases where, notwithstanding the [ex ante] safeguards […], the providers of those services nonetheless erroneously or unjustifiably block lawful content” (para 93).

The complaint mechanism is therefore intended to deal with cases where there is a dispute as to whether the content is manifestly infringing. In those cases, however, it is in the nature of things that the content in question stays offline for the duration of the complaint mechanism. This presupposes that the basic requirements for ex ante safeguards have been implemented and that the ex post complaint mechanism only applies in exceptional cases. It is only under these conditions that provisions like the Italian one under which all contested content shall remain disabled for the duration of the complaint procedure can be considered compatible with the judgment.

The Commission’s category of “earmarked content” needs revision

The second aspect relates to earmarked content as mentioned in the Commission’s Guidance on Article 17. The Guidance defines earmarked content as content flagged by rightholders that is particularly valuable and could cause them significant harm if it remains available without authorization (examples include pre-released music or films). According to the Guidance, earmarked content should be specifically taken into account when assessing whether OCSSPs have made their best efforts to ensure the unavailability of content.

What is highly problematic about this provision, however, is that OCSSPs would be forced to exercise particular care and diligence in this case, which would ultimately result in a higher blocking rate and ignore the requirements of the judgment in the Polish annulment action. As a solution, the Commission presents rapid ex ante human review in the Guidance, which takes place for such earmarked content before the content gets online, when detected by the filters.

This, however, does not comply with Article 17(8) CDSMD and what follows from the Glawischnig-Piesczek and recent Poland cases. According to these cases, a provider can only be required to remove content where a detailed legal examination is not necessary. And, although framed as “rapid ex ante review”, this is nothing other than a detailed legal examination.

Therefore, the Commission needs to revise its Guidance on this point and Member States should choose an implementation of earmarked content which respects the case law. A possible solution could be to use an earmark mechanism not ex ante but ex post. Content which is marked by rightholders as of significant economic value and matches content uploaded by users could be processed through an accelerated complaint procedure. This would be similar to what Article 19 of the Digital Services Act (DSA) establishes.

The DSA needs to fix Article 17 CDSMD

The DSA raises hopes for more harmonisation of details related to the interpretation of Article 17 CDSMD. Due to a largely overlapping scope of application for OCSSPs in the area of copyright, it can be assumed that the DSA provisions apply on the basis of a lex generalis relationship to Article 17 CDSMD. Provisions such as Article 17 DSA, that sets out detailed rules for a complaint mechanism, or Article 19 DSA, with its trusted flagger regime, could influence the way Article 17 CDSMD works in practice.

Due to its nature as a regulation, the DSA should lead to greater harmonisation. In order to achieve this, it would in addition be necessary to use the aforementioned revision of the Guidance to develop a positive definition of manifestly infringing content which can be used as a basis for designing the algorithms of OCSSPs.

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COMMUNIA and Gesellschaft für Freiheitsrechte co-hosted the Filtered Futures conference on 19 September 2022 to discuss fundamental rights constraints of upload filters after the CJEU ruling on Article 17 of the Directive on Copyright in the Digital Single Market (CDSMD). This blog post is based on the author’s contribution to the conference’s first session “Fragmentation or Harmonisation? The impact of the Judgement on National Implementations.” It is published under a Creative Commons Attribution 4.0 International licence (CC BY 4.0).

On 26 April 2022, the CJEU dismissed the annulment action initiated by the Republic of Poland against Art. 17 CDSM Directive 2019/790 on copyright and related rights in the Digital Single Market (CDSMD): According to the Grand Chamber of the CJEU, the provision imposes a de facto obligation on service providers to use automatic content recognition tools in order to prevent copyright infringements by users of the platform. While this obligation leads to a limitation of the freedom of expression of users, appropriate and sufficient safeguards accompany the obligation, ensuring respect for the right to freedom of expression and information of users and a fair balance between that right and the right to intellectual property. However, guidelines of the CJEU as to how such safeguards have to be implemented in detail remain vague (C-401/19).

User safeguards in the German implementation

The Member States of the European Union follow different approaches when it comes to the implementation of Art. 17 CDSMD. The result is a legal fragmentation of platform regulations and uncertainty for service providers, rightholders and users alike as to the prerequisites under which OCSSPs have to operate. When the German Act on the Copyright Liability of Online Content Sharing Service Providers (OCSSP Act) entered into force imposing several detailed obligations on the service providers, many considered this new law as a model for the remaining implementations of other Member States. With its unique system, in which ex ante duties to block unlawful content are inseparably intertwined with ex ante duties to avoid the unavailability of lawful user content, the German OCSSP Act contains provisions which could pass as sufficient safeguard mechanisms in the meaning of the decision of the CJEU. In response to the debate on EU level and in other Member States, the OCSSP Act introduces a new category of “uses presumably authorised by law” – i.e., any statutory limitation to copyright –, which, as a rule, must not be blocked ex ante.

“Uses presumably authorised by law”, as laid down in sec. 9 of the OCSSP Act, can either be minor uses, which do not exceed the thresholds of sec. 10 OCSSP Act, or – if that is not the case – uses which the user flagged as legally authorised as per sec. 11 OCSSP Act. Both minor uses and flagged UGC must contain less than half of one or several other works (with an exception for images) and must combine this third-party content with other content. If these requirements are met cumulatively, the service provider must communicate the respective UGC to the public up until the conclusion of a complaints procedure. Thus, the category of “uses presumably authorised by law” enables the user to upload the content without interference by an automated copyright moderation tool. Rightholders, on the other side, are equipped not only with the possibility to initiate an internal complaints procedure but also with a “red button” which leads to the immediate blocking of content if it impairs the economic exploitation of premium content by the rightholder.

In sum, the German OCSSP Act provides a well-balanced legal framework. However, the quality of a statute is not only measured by its text and the concepts applied but also by the practical impact on the behaviour of its addressees. The question arises whether the OCSSP Act is able to deliver on its promises or if it turns out to be a toothless tiger in practice.

Effects of the German OCSSP Act

Against this background, Alexander Peukert and I have analysed whether the enactment of the German OCSSP Act in August 2021 had an immediate impact on platforms’ policies. The results of the study are compiled in a paper published in January 2022, which was the foundation for the presentation at the Filtered Futures conference on 19 September 2022 in Berlin. For the purpose of answering the question of what factual effect the OCSSP Act has actually had on the platform policies, the study examines the terms and conditions of several service providers both before and after the enactment of the OCSSP Act on 1 August 2021. We reviewed and analysed the German-language websites of eight services as to whether their terms and conditions and other publicly accessible copyright policies changed upon the entry into force of the German OCSSP Act. The data was collected at four points in time between July and November 2021. At all four points, we analysed the source-data as to whether the service provider implemented six selected mandatory duties, including the possibility for rightholders to submit reference files, the flagging option, the red button solution and a complaint system in accordance with the requirements of the OCSSP Act. With a total of 514 saved documents, including terms and conditions, general community and copyright guidelines, complaint forms, FAQs and other relevant copyright help pages, the paper allowed us to identify the practical effect of the German OCSSP Act over time on individual services, and across the eight services covered.

The results of the data collection are twofold. One the one hand, the changes which could be observed in the terms and conditions of the platforms over time are minor. On the other hand, there were differences between the service providers with regard to their compliance level with the statutory duties of the OCSSP Act already before its enactment (see table below).

Most changes we witnessed concerned the duty of the OCSSPs to guarantee a “notice and prevent” procedure. The flagging option, by contrast, was not clearly laid out in the terms and conditions of any service provider, at best vaguely indicated by YouTube and Facebook. The obligation of the service providers to inform their users about all statutory limitations under German copyright law in their terms and conditions was not fully met by the services, as they primarily referred to exceptions and limitations under “fair use” or EU law, but never to the exceptions and limitations under German copyright law.

Conclusions and outlook

In the conclusions of the paper, we raise the question of why larger platforms such as YouTube, Facebook and Instagram display a higher compliance with the OCSSP Act than comparatively small content sharing platforms. Furthermore, we note that it has become apparent that different Member State implementations and generally uncertain legal circumstances on the EU level impair the willingness of OCSSPs to take measures. It remains to be seen whether the decision of the CJEU will have any noticeable impact on the platform-side implementation. Lastly, the study brings to light the consequences of the lack of sanctions for failure to implement the user rights, in particular the regime regarding “uses presumably authorised by law”, i.e., minor or pre-flagged uses, in the German OCSSP Act.

In its essence, the study can serve as a starting point for further research. While the findings of the study reflect the changes of platform policies and primarily offer a text-based evaluation, they may provide incentives to investigate the upload process and other functionalities of the service providers further. More in-depth research on the legal and practical aspects of the new era of platform regulation is necessary to close the gap in legal doctrinal research on the implementation of Art. 17 CDSMD on platform level. The recently published decision of the CJEU and its emphasis on sufficient user safeguards adds fuel to this fire.

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The Salon kicked off with Teresa Nobre and Dimitar Dimitrov presenting our ongoing work supporting user rights’ advocates across the EU Member States to ensure a user rights’ friendly implementation of the Directive into national legislations (from 1:11 to 18:13 in the video recording). This was followed by the launch of the Eurovision DSM Contest, a new website which tracks the implementation progress for each Member State. 

The second part of the event (from 20:00 in the recording onwards) consisted of a discussion on the Commission’s Article 17 guidance. Paul Keller opened the discussion by noting that, while the guidance establishes important user rights’ safeguards that put into question the implementation approach chosen by Member States – most notably by France and Denmark –, it also contains a massive loophole by allowing rightholders to “earmark” their content as economically valuable.

Felix Reda (GFF) followed up by comparing the guidance to the recently adopted German implementation law. He argued that the German law seemed to be largely in line with the principles established by the guidance and highlighted that the German rules, for certain types of “high-value” content, are highly targeted and limited. In this light, this is much less problematic than the “earmarking” mechanism introduced by the Directive. 

João Quintais (IVIR) focussed his presentation on some of the other aspects of the Directive, such as the nature of the right established by Article 17. He has since also published these observations in a separate post on the Kluwer Copyright Blog. 

Finally, Christophe Geiger (CEIPI) placed the guidance in the context of the pending Polish CJEU challenge of the fundamental rights compliance of Article 17. In his assessment the guidance is insufficient to save the filtering provisions in Article 17 from annulment by the Court.

During the subsequent discussion, Anneli Andresson from the European Commission’s copyright unit came to the defence of the much criticised “earmarking” mechanism contained in the final version of the guidance (from 1:12:45 in the recording onwards). 

According to her, the Commission did not mean the earmarking mechanism to apply to content other than “time sensitive content”. According to her the Commission’s idea for the guidance “was not to extend the system to what is beyond what is not time sensitive” and that the mechanism is “temporary and only applies when the content is time sensitive”. She also pointed to safeguards including the requirement for rightholders to justify earmarking content and that services have the ability to apply safeguards against misuses, which include the possibility for rightholders to suspend the ability to “earmark”.

As welcome as these clarification by the Commission are, it remains to be seen what they are worth. The real test for the Commission’s Guidance will be the Polish challenge of the fundamental rights compliance of the filtering provisions in Article 17, that is currently pending before the CJEU. To get a first glimpse of the CJEU’s thinking on this issue, and if the guidance issued by the Commission does provide meaningful protection for users’ fundamental rights, we will have to wait until the 15th of July when Advocate General Øe will issue his opinion.

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While at the beginning of the week only three Member States had fully implemented the Directive (the Netherlands, Hungary and Germany), and could therefore be scored on all performance levels, it is already possible to track the level of activity across the board. As more Member States reach the finish line, we will attribute final scores and throw them into the contest. 

The first, second and third places (so far!)

So far, Germany is the front runner: the Federal Ministry of Justice and Consumer Protection held a transparent and inclusive discussion, which lasted for more than a year, and set a high standard for protecting user rights against overblocking. Hungary is in second place, in part due to the bonus point it got for fast-tracking the implementation of the new digital education exception, during the outbreak of COVID-19, having created room for remote teaching while educational institutions were closed. The Netherlands have been the first out of the door, with a draft text ready for an online consultation less than a month after the publication of the Directive, but the Dutch government failed to demonstrate its commitment to protecting user rights in the implementation, pushing it to the third place so far (with the possibility to still earn some extra points, if the Minister of Justice decides to make use of the power that received in the implementation law, to provide further rules for the application of Article 17).

France and Denmark, which have rushed to implement on time only the provisions that strengthen the position of creators and right holders, have been scored for the implementation of Articles 15 and 17, but will only officially enter the contest once they have implemented the remaining parts of the Directive.

Skipping the parliamentary debate

At this point, all Member States (except Portugal) have, in some way or another, initiated the legislative procedure, but some processes have been far from transparent or inclusive. In France and Italy, the Parliament delegated the legislative powers in the government, meaning that those countries will skip a central stage of the democratic process, which is the parliamentary debate and vote over the concrete implementation proposal put forward by the government. In France, where the Ministry of Culture went through the implementation of Articles 15 and 17 without providing any opportunity for stakeholders to share their views and concerns about those provisions, no public consultation is expected for the remaining parts of the Directive. In Italy, the Ministry of Culture is said to be planning to, at least, run a public consultation once its draft decree is finalized.

In Ireland, the Department of Business, Enterprise and Innovation held a series of public pre-draft consultations, each focused on a different part of the Directed and all carefully prepared, but a few days ago announced that the Directive was going to be transposed into Irish law by way of regulations contained in secondary legislation, without submitting the actual draft law to public discussion and without further parliamentary debate.

In Spain, a first round of public pre-draft consultations was organized at the end of 2019, but since then the Ministry of Culture went silent, leaving meeting requests by civil society representatives unanswered, while at the same time meeting with collecting societies and other industry representatives. Most recently, there have been rumours of a Royal Decree that would give the Spanish government the power to also implement the Directive without any further parliamentary deliberation.

Portugal is the slowest country so far (it has not published any draft text and has not even organized a public consultation), and civil society representatives have also been treated less favourably by the Ministry of Culture than representatives of rightholders: the latter have been invited to provide feedback on the implementation and have been granted the opportunity to meet with the Minister of Culture, while meeting requests sent by civil society organisations (including by COMMUNIA) to the Ministry have been left unanswered.

Meaningful consultation procedures: some more, others less

Fortunately, the procedures in that handful of countries seem to be the exception, rather than the rule. The vast majority of Member States attempted to give all stakeholders, and not only a selected few, opportunities to participate in the discussions. Some countries decided to consult stakeholders at the very beginning of the process, before embarking in the drafting process, others kept discussions alive throughout the process, and others yet reserved most time for dialogue after releasing the draft.

Of the 19 Member States that organized pre-consultation processes, 8 held formal consultations, 8 opted for setting up working groups or entering into other forms of dialogue with stakeholders on the provisions of the Directive, and only 3 organized both a consultation and meetings with stakeholders before starting the drafting process. After the release of the draft, 7 countries organized formal consultations, 6 engaged in dialogues with stakeholders, and 2 (Germany and the Netherlands) opted by running formal consultations and engaging also in constructive dialogues with the stakeholders.

So far, Greece, Italy, Finland, Malta, Norway, Portugal, Poland, Spain, Sweden are the only countries that have not publicly released any draft implementation text. France and Denmark have yet to release proposals for the parts of the Directive that have not yet been implemented.

It is safe to say that the Eurovision DSM contest is far from over, and that the results can still change dramatically. We will keep tracking the process and updating not only each country’s scores, but also each country’s page in our implementation tracker, where detailed information and documentation about each process can be found.

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We will kick off the event with the Eurovision DSM contest evaluating the implementation progress (or the lack thereof) in the 27 member states. We will hand out awards for the best and worst implementations and will let you know which Member States have managed to implement in time and which ones are still struggling.

After this glamorous introduction we will shine a spotlight at the latest developments related to the implementation of Article 17 of the directive. Felix Reda (Project lead Control © at GFF and former MEP), João Quintais (Institute for Information Law at the University of Amsterdam), Christophe Geiger (Centre for International Intellectual Property Studies – CEIPI, University of Strasbourg) and Paul Keller (Open Future / COMMUNIA) will take a close look at the newly adopted German implementation law with its strong focus on user rights safeguards. They will also examine the final version of the Commission’s implementation guidance which we expect to be published just in time for our Salon. The Salon will be moderated by Teresa Nobre (COMMUNIA). 

As always, the COMMUNIA Salon is open for everyone to attend and will be held on Zoom. Join us on Monday, the 7th of June, at 1530 CEST, by registering here. Registered participants will receive login information ahead of the event.

The post Communia Salon 2021/3: It’s the 7th of June 2021, so why is the internet still here? appeared first on COMMUNIA Association.

Presumably legitimate uses

Once signed into law, the implementation of Article 17 will be the first one that contains a practical mechanism designed to ensure that the use of upload filters does not result in the blocking of user uploads which do not infringe copyright. The need for such an ex-ante mechanism arises from Article 17(7) and has also been stressed by the Commission at various points in the past. 

In order to achieve this, the German implementation relies on the concept of “uses presumably authorised by law”, which must not be blocked automatically. For an upload to qualify as “presumably authorised by law”, it needs to fulfil the following cumulative criteria:

• The use must consist of less than 50% of the original protected work,
• The use must combine the parts of the work with other content, and
• The use must be minor (a non-commercial use of less than 15 seconds of audio or video, 160 characters of text or 125 kB of graphics) or, if it generates significant revenues or exceeds these thresholds, the user must flag it as being covered by an exception.

If these conditions are met, the use is considered to be “presumably authorised by law” and cannot be blocked automatically. Rightholders can still challenge the legality of such uses but platforms are required to keep the uploads online until those complaints have been reviewed by the platforms (there is an exception that allows “trusted rightholders” to request immediate removal if they consider the use evidently infringing and commercially harmful). 

This mechanism had been the target of massive criticism from rightholders throughout the parliamentary debate and it is welcome to see that the Bundestag has had the courage to hold the line here. The version of the law adopted today makes one small concession to rightholders. It now specifies that the “presumably authorised by law” mechanism does not apply to “the use of cinematographic works or videos until the end of their first public broadcast, in particular during the simultaneous broadcast of sports events, provided that the rightholder requests this from the service provider”. This change addresses concerns expressed by sports associations who argued that allowing people to share 15 second clips of sports events during an event would ruin their business model. While this seems highly dubious, the exception is so narrow that its impact on legal uses will be fairly minimal. 

Other improvements

Otherwise, the changes made by the Bundestag are decidedly to the positive and many of them address issues that we identified in our statement on the occasion of the expert meeting of the Legal Affairs Committee: 

• Within the scope of the Article 17 implementation, all copyright exceptions except those for pastiche, parody and caricature remain unremunerated (the fact that citations were originally supposed to be remunerated had drawn criticism from a large group of academics)
• Also in the context of the implementation of Article 17, service providers will not be liable for damages resulting from decisions that they take when adjudicating complaints. This removes an incentive for platforms to side with rightholders when adjudicating user complaints.
• The provision allowing collective redress against structural overblocking by platforms has been further strengthened. These provisions also provide the basis for claiming  damages from originators of false copyright claims.
• The version adopted today also includes a new provision requiring platforms to provide scientific researchers access to data about the use of automated content recognition technology, allowing for a minimum level of transparency. 
• The exception allowing caricature, pastiche and parody, which is newly introduced into the German Copyright Act, will not be limited to only allow uses “justified by their purpose” (such a limitation was included in the government proposal and would have contradicted existing EU case law).
• All of the exceptions for education and research, which were previously set to expire in early 2023, will now be permanent.
• The Bundestag also clarified that a rule that would have excluded all written works younger than 30 years from being considered to be out of commerce now only applies to written works that have been published by a publisher.

Setting the standard

These changes mean that the German implementation law sets a new standard for the implementation of the DSM directive. This is especially true for the implementation of Article 17. With the Commission having missed the chance to issue guidance for the member states in a timely manner, other member states who seek to implement Article 17 in a fundamental rights-compliant way should look at the German law for guidance. 

A similar logic will be at play for platforms. The German law is the first law that contains an actual mechanism that they can implement. Given that Germany is the largest market in the EU it seems plausible that they will apply mechanisms based on the German law across the EU. Here the fact that all other member states have so far limited themselves to restate the text of Article 17 of the directive means that mechanisms that comply with the German law will also be in compliance with the other implementations passed so far. As a result it would not be surprising if the German law turns out to be the real implementation guidance. 

In the end the German implementation will also be the standard that the CJEU will have to consider when judging if Article 17 can be implemented without violating users’ fundamental rights. Here it remains to be seen if what the German legislator has come up with is good enough to meet the standards of the EU Charter of Fundamental Rights.

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In addition there are two Member States who have adopted so-called delegation laws that allow them to implement the provisions of the directive via subsequent administrative decrees. France adopted its delegation law in December 2019 and on the 20th of April Italy followed suit and adopted its delegation law. While the French implementation decree (which will include the actual provisions to be included in the copyright act) is still nowhere to be seen, the Italian Comitato Consultivo Permanente per il Diritto D’Autore is discussing a draft version of the Italian Implementation decree (pdf in Italian) today. 

Based on what is contained in the draft the Italian implementation is shaping up to be the worst one yet. The draft fails to implement exceptions that are mandatory under the directive (the fallback exception for out of commerce works in Article 8(2) CDSM), it claims that users can rely on a non-existing parody exception and it also claims (in the text of the law itself) that automated content recognition systems (a.k.a upload filters) can “ascertain clear violations” of copyright (something that literally everyone including the French government agrees that they can’t).

Otherwise, there has been relatively little recent movement in the EU Member States. The German implementation draft is still making its way through parliament. It is now in the final stages of deliberation and the the final vote is expected to take place on the 20th of May. Meanwhile most other Member States seem to be stuck in a holding pattern after having completed public consultations of their draft implementation legislation, shying away from introducing legislation into their parliaments.

Commission failure to provide guidance creates massive legal uncertainty.

This reluctance to move forward is clearly the result of the European Commission’s abject failure to deliver its long overdue Article 17 implementation guidance, which is intended to help Member States to resolve the internal contradictions contained in Article 17 and to implement it in a fundamental rights compliant way. 

The guidance which had originally been expected to be published in the second half of 2020 is being held up at the political level of the Commission since early this year.

The failure to deliver the guidelines puts those Member States who had counted on the Commission’s guidance into a difficult position. By waiting for the guidance to be published they have effectively lost the ability to implement the Directive in time.

Without the guidance from the Commission (or from the CJEU, which has recently postponed the AG opinion in the Polish case challenging the fundamental rights compliance of Article 17) Member States will need to figure out themselves how they intend to reconcile the requirement on platforms to ensure that legitimate uses of copyrighted works are not blocked with the parallel requirement to make best efforts to prevent the availability of works that rightholders want to have blocked.

Unfortunately, none of the already existing implementation laws provide any guidance either. Both the Dutch and the Hungarian laws have stuck to copying the language contained in the Directive including all of its internal contradictions. As a result they are passing the responsibility of reconciling the contradictions that they were not willing to address themselves on to the online platforms. Platform operators will now have to find a balance between the diverging interests of rightholders and users of their platforms. Given that they face a one-sided liability risk, there are huge incentives for them to err on the side of caution and structurally block legitimate uploads.

With the Commission’s guidance still missing in action, Member States still working on their implementations should instead orient themselves on the principles expressed in the Commission’s draft guidance and the arguments brought forward by the three EU legislators in last November’s CJEU hearing of the Polish challenge to Article 17. At both occasions the Commission made it clear that implementations of Article 17 must limit the use of automated blocking of uploads to situations where such uploads are “manifestly infringing”. Such safeguards must operate ex-ante, meaning that implementations that only include an ex-post complaint and redress mechanism (as it is the case in the Dutch and Hungarian implementations) do not meet the requirements established by the directive. 

At the moment only the implementation proposals from Germany, Austria and Finland fulfil these conditions to some extent. Of these, the German proposal is the only one that still has a chance to become enacted before next month’s implementation deadline. 

While it is not unusual that some EU Member States miss the implementation deadlines for an EU directive, it is fairly exceptional that the CDSM directive will be implemented in less than a hand-full of Member States when it becomes effective on the 7th of June. Unlike in other cases the blame for the failure to meet the deadline, and the resulting legal uncertainty for users, rightholders and service providers will lie squarely with the Commission this time. 

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One highlight of the presentation was the revelation that the Ministry has also filed an amendment to its own proposal, that expands the transparency provisions contained in the proposal. The proposed amendment would allow access to “data on the use of procedures for the automated and non-automated recognition and blocking of content to authorised parties” for scientific research purposes. In the light of our repeated calls for more transparency when it comes to the use of automated content recognition, this is a small but significant improvement of the proposal. 

The initial presentation was followed by perspectives from Marco Pancini (YouTube), Xavier Blanc (AEPO-ARTIS) and Felix Reda (GFF) who highlighted different aspects of the legislative proposal. Speaking from the perspective of large pan European platforms Marco Pancini expressed concerns about the variation of legislative approaches in the Member States with Germany marking one end of the spectrum. According to him this will lead to fragmentation of the digital single market and create substantial compliance burdens for all types of platforms.

Speaking from the perspective of performers, a group of rightholders that has an interest to see as much use of their works on as many platforms as possible (and does not necessarily benefit from being able to selectively control use of their works), Xavier Blanc called the German proposal “impressive in its ambition” and lauded it as an effort to find a balance between the diverging interests involved in the implementation discussion. He also expressed concerns regarding the practical application of the minor use thresholds contained in the directive. 

Finally, Felix Reda pointed out some of the key shortcomings of the proposal that has been sent to parliament. These include the ridiculously short threshold of 160 characters for minor uses of textual works (the fact that “spaces are not included” according to the Ministry officials does not make this any better, as sometimes the mere title of a work will pass that threshold) and the requirement that uses must consist of less than 50% of an original work to be protected from automated filtering. In the same vein, he pointed out that the proposal in its current form does not offer any possibility to flag contractually allowed uses (such as uses authorised by a Creative Commons license) as legitimate. Felix Reda also pointed out that while the proposal contains sanctions against abuse, it is missing the ability for users to obtain structural remedies. Such remedies are being proposed by the Austrian Government.

The presentation and discussion once more underlined that, while flawed in some aspects, the German implementation proposal gets many things right. As observed by multiple speakers, the key characteristic of the proposal is that it actually tries to identify mechanisms for reconciling the conflicting obligations contained in Article 17 of the directive. As such it sets out a path for how Article 17 should be applied in practice, where other proposals don’t go any further than re-stating the conflicting objectives contained in the directive. As observed by Felix Reda, the proposals also make it clear that, contrary to earlier promises by the German government, upload filters are a fact that users will have to deal with. 

That being said, the questions if the use of automated upload filters is in compliance with fundamental rights will need to be answered by the CJEU, a decision that is expected only after the German proposal is likely to be adopted (late May).

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For this edition of the COMMUNIA Salon we will be joined by Dr. Martin Bittner und Dr. Thomas Ewert of the German Ministry for Justice and Consumer Protection (BMJV) who will present the implementation proposal. We will have reaction from Felix Reda (Project lead control © at GFF and former MEP), Marco Pancini (Youtube) and (Xavier Blanc (AEPO-ARTIS). The presentations will be followed by an informal question and answer session and concluding remarks by Paul Keller (COMMUNIA/Open Future). The Salon will be moderated by Teresa Nobre. 

The German proposal has been adopted at an interesting time. While the Commission is finalising its implementation guidance, the German proposal shows what the user rights-preserving implementation foreseen by the Commission in its draft guidance could look like in practice. The proposed German implementation of Article 17 contains specific mechanisms designed to ensure that platforms comply with the requirement in Article 17 that legal uploads must not be blocked. While the proposal is not without flaws, it can nevertheless serve as an example for other Member States looking for a way to implement Article 17 in a user rights-preserving way. 

As always, the COMMUNIA Salon is open for everyone to attend and will be held on Zoom. Join us on Wednesday, the 17th of March, at 1530 CET, by registering here. Registered participants will receive login information ahead of the event.

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This post will take a closer look at the provisions implementing Article 17 of the Directive into German law. As we had noted in our analysis of the original discussion draft from June last year, the German legislator is proposing to implement these provisions into a new act that is separate from the copyright act: the “Act on the Copyright Liability of Online Sharing Content Service Providers”. By now the proposal for this act has undergone two public revisions. After the first discussion draft in June, the Ministry of Justice published a revised draft (“Referentenentwurf“) in October of last year. This revised version maintained the core user rights safeguards underpinning the original proposal (a new remunerated exception for minor use and the ability for uploaders to flag uploads as legitimate) while making a few changes to the way the pre-flagging mechanism works. 

A step back for user rights

Just as the original discussion draft, the Referentenentwurf drew massive criticism from rightsholders that was primarily directed at the user rights safeguards contained in the proposal. Unfortunately the Ministry of Justice has now caved in to some of these demands and as a result  the user rights safeguards have been further cut back in the final proposal adopted by the government (“Regierungsentwurf“).

The most substantial change in the Regierungsentwurf concerns the legal mechanism for ensuring that user rights are protected in line with the requirements of paragraph 17(7). The original proposal relied on a new exception that legalised minor uses of copyrighted works (any use consisting of less than 20 seconds of audio or video, 1000 characters of text or images smaller than 250Kb) and would have prevented platforms from blocking such uses. 

In the updated proposal this exception is gone and has been replaced by a more limited construction of “uses presumably authorised by law” which cannot be blocked automatically. For a use to be “presumably authorised by law” it needs to fulfil the following cumulative criteria:

1. The use must consist of less than 50% of the original protected work,
2. The use must combine the parts of the work with other content, and
3. The use must be minor (a non-commercial use of less than 15 seconds of audio or video, 160 characters of text or 125 kB of graphics) or, if the use generates significant revenues or exceeds these thresholds, the user must flag it as being covered by an exception.

If these conditions are met, the use is considered to be “presumably authorised by law” and cannot be blocked automatically (neither at upload or at a later stage). This new approach is problematic in at least two regards: Firstly, it excludes all uses where more than 50% of an underlying work is used and secondly the threshold of 160 characters of text (that is the result of massive pressure from press publishers) is completely impracticable as it allows automated blocking of uploads based on extremely short snippets of text such as a single sentence. The new “less than 50% of the original” threshold means that some uses that clearly fall under exceptions and limitations (including the ones for quotation, caricature, parody and pastiche explicitly mentioned in paragraph 17(7)) can be automatically blocked at the request of rightsholders. 

Two steps forward in the implementation discussion

While these changes have resulted in a weaker level of protection of users’ rights , the proposal still manages to provide meaningful procedural safeguards for users, that limit the ability of rightsholders and platforms to deploy fully automated upload filters. To ensure that “automated procedures” deployed by platforms in order to  comply with their requirements under Article 17(4) do “not result in the unavailability of content uploaded by users if the use is authorised by law or does not infringe copyright”, the proposal prescribes the following procedure:

1. If an upload matches a work that a rightsholder has requested to block, the platform needs to determine whether the match meets the initial criteria for “uses presumably authorised by law” as outlined above.
2. In the case of “minor use” no further action of the user is required. If however the use is not minor, the platform needs to inform the user of the blocking request and about the need for uses to be authorised by law, and give the user the ability to flag the use as legal.
3. If the conditions for “uses presumably authorised by law” are not met, the platform must block the content and inform the user that she can file a complaint (that needs to be justified). Content has to stay down until the complaint is resolved (if the user does not file a complaint the content stays blocked).
4. If the conditions for “uses presumably authorised by law” are met, then the content stays up and the rightsholder is informed about this fact. The rightsholder can then file a complaint, and the content stays up until the dispute is resolved (if the rightholder does not file a complaint the content stays up as well).
5. If the rightsholder is a “trusted rightsholder”, and after a human review they decide that the use is evidently infringing and commercially harmful, they can request that the content is taken down immediately until the dispute is resolved.

Complaints submitted by rightsholders and users must be processed by the platform (or an entity designated by the platform) within one week. If the use is found to be legal then it must stay up (or be reinstated, if it had previously been blocked). If the use is found to be infringing then it must be taken down (or remain unavailable if it had previously been blocked).

Illustration of the Article 17 workflow by the German Ministry of Justice and Consumer Protection (BMJV). See our own more detailed illustration here.

Despite the substantial weakening of the standard for identifying uses that cannot be blocked automatically that it has undergone since the initial version, the German proposal still manages to provide meaningful safeguards against over-blocking. In broad lines, the German proposal follows the model that we had presented at the sixth meeting of the Commission’s stakeholder dialogue almost a year earlier. While some of the parameters (most notably the 160 characters maximum for minor uses, and the requirement that a use must contain less than 50% of an original work) are deeply flawed, the core mechanism to comply with the requirements in Article 17(7) remains unchanged: automated filtering without any human oversight must be limited to uploads that are classified as manifestly infringing. 

It is welcome  to see that, so far, this guiding principle has survived all attempts of weakening the user rights safeguards in the German implementation discussion. In this context it is important to note that the German proposal does not stand alone in recognising this guiding principle: the same principle is present in the Commission’s draft implementation guidance, the recent Austrian implementation proposal and it has been endorsed by a large group of copyright scholars as early as in the fall of 2019. However, it is questionable however whether the specific thresholds chosen by the German government are sufficient to meet the requirement of Article 17 (7) that legal content must not be blocked, given that examples abound where perfectly legal uses would fail to meet those increasingly strict thresholds.

The German proposal will now be discussed in the German Parliament with a first reading scheduled at the end of March. On the 17th of March, ahead of this reading we will organize a COMMUNIA salon in which we will discuss the proposal in more detail with representatives of the German Ministry of Justice and Consumer Protection (additional participants to be confirmed) You can sign up for this event here.   

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