European Union Agrees on Copyright Directive Text, Pushing Legislation Towards Final Vote

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The proposed final language will now go before the European Parliament's legal affairs committee before a final vote on the directive can take place.

The European Union's plan to reform copyright legislation -- and potentially transform how user generated content (UGC) platforms like YouTube operate on a worldwide basis -- has taken a major step towards becoming law after policy makers agreed upon a definitive text of "Directive on Copyright in the Digital Single Market" on Wednesday (Feb. 13). The move follows two years of closed-door negotiations, intense lobbying from the music and tech industries and an unprecedented online campaign.

Representatives of the three branches of European government -- the European Commission, the Parliament and the Council of the European Union -- had been locked in "trilogue" negotiations for several days before a final deal was reached late Wednesday evening Central European Time.

The agreed text -- which includes the directive's two most controversial aspects, Articles 11 and 13 -- will now go before the European Parliament's legal affairs committee before a final vote takes place, most likely in late March or early April. If members of the European Parliament vote in favor of adopting the directive, EU member states will then have between 18-24 months to individually transpose its requirements into national law. No new revisions are permitted at the voting stage, meaning that the directive text as agreed on Feb. 13 is the set version.  

"Today's agreement is a sign of our determination to set up a well-functioning digital single market that encourages the development of new content-based businesses in the interest of all European citizens," said Valer Daniel Breaz, Romanian Minister for Culture and National Identity, announcing the conclusion of negotiations.

Breaz said the agreement reached would "unlock the opportunities of the digital world, both for creators, whose rights should be fully respected and for the European citizens."

In a tweet, Andrus Ansip, European Commission vice-president for the digital single market, called the copyright directive "a major achievement for Europe" that brings "real benefits for everyone: guaranteed rights for users, fair remuneration for creators, clarity of rules for platforms." 

Welcoming the news, Anders Lassen, president of GESAC, the European Grouping of Societies of Authors and Composers, representing over 1 million authors, said: "We still need to have a careful assessment of the final text, but its adoption sends a clear signal that large platforms dominating the online content market at the expense of creators must stop freeriding and comply with copyright rules. He called upon Member States and the European Parliament to now "give their final approval to this historical breakthrough, without any further delay."

"Despite the pressure of tech giants until the very end, the text, which still needs to be assessed in detail, is a major achievement. It will enable creators to be remunerated fairly by large online platforms that today are siphoning the value of the creative sector while failing to compensate creators," added GESAC director general VĂ©ronique Desbrosses.

Dr. Harald Heker, CEO of German collection society GEMA, said the agreement was "an important step" for artists and songwriters and would ensure online platforms "finally have to pay authors a fair remuneration for the usage of their works."

"The draft of the Directive that we now have in front of us imposes a higher level of responsibility onto the online platforms and strengthens the position of creators as well as internet users at the same time," said Heker. "It is now up to the European Parliament to give green lights for a modern copyright," he added.  

Following the European Union's announcement, Google, which ran a high-profile public and private lobbying campaign against Article 13, issued a statement saying: "Copyright reform needs to benefit everyone -- including European creators and consumers, small publishers and platforms. We'll be studying the final text of the EU copyright directive and it will take some time to determine next steps. The details will matter, so we welcome the chance to continue conversations across Europe."

The details that Google executives will be most closely inspecting relate to the final wording of Article 13, the copyright directive's most hotly contested element, requiring UGC platforms like YouTube to conclude "fair remuneration" license deals with rights holders and bringing them closer in line with streaming services Spotify and Apple, which currently pay multiple times more. According to IFPI estimates, Spotify paid record companies $20 per user for every $1 that YouTube paid out in 2017.   

Article 13 also makes YouTube legally liable for hosting unlicensed content -- effectively ending safe harbor immunity in Europe -- a particular bone of contention for Google, which has claimed it will mean the end of memes and GIFs and damage artists' livelihoods. Blog posts from YouTube CEO Susan Wojcicki and global head of music Lyor Cohen published in late 2018 called on the platform's users to add their voice to the already loud online protests against the EU's plans. A public petition to block Article 13 on Change.org has since been signed by 4.7 million people.

Rights holder groups and artist representatives will also be carefully examining the exact wording of Article 13 and any exceptions it makes around platform liability and for start-up digital services. Just a few days ago, on the eve of the sixth and final trilogue meeting in Strasbourg, a consortium of label and publisher trade bodies, including IFPI, IMPALA, and the International Confederation of Music Publishers (ICMP), urged the European Council not to proceed with its latest version of the directive as it "risks leaving producers, distributors and creators worse off."

That led to a stinging rebuke from the UK Council of Music Makers, accusing labels and publishers of trying to kill off the directive at the 11th hour and placing "short-term commercial interests" ahead of their artists, who potentially stand to make strong gains from Directive Articles 14 and 16 (covering transparency and musicians' rights around the exploitation of their works).

All parties will now scrutinize the directive text to determine what impact, good or bad, it will have ahead of the final Parliament vote.