Prominent European copyright academics present approaches to implement the mandatory Article 18 of the Digital Single Market Directive, including an unwaivable right to fair remuneration administered by collective management organisations.
The European Copyright Society (ECS), a group of leading European academics, has issued an opinion on fair remuneration in exploitation contracts of authors and performers as part of the implementation the Digital Single Market Directive.
Authors and performers need to be in the centre of the minds when implementing the Directive. This is based “on a well-established body of empirical studies that shows an enormous disparity between the earnings of winners-take-all star authors and performers, as well as the persistent precariousness of the financial situation of the vast majority of European creators and performers.” We add that this disparity has increased dramatically during lockdown (whilst record companies’ executives bank record bonuses).
The academics urge member states to ensure “full force and efficiency” of these provisions ensuring that authors and performers are the main beneficiaries as weaker parties in contractual negotiations. This is the stated intention of the Digital Single Market Directive (C.f. Recital 72).
Whilst Articles 18-22 have a binding nature and cannot be contractually overridden, member states are free to use non- contractual mechanisms to implement the principle of a fair remuneration. “One such mechanism that Member States are free to maintain or introduce in their laws could consist in an unwaivable right of remuneration that authors or performers cannot transfer (except upon death or for administrative purposes to a CMO) and that could be managed and collected by CMOs.” The ECS elaborates on the legal details of such an unwaivable right of remuneration is already exercised under European Union legislation.
“The EU recognised such a [unwaivable remuneration] right in relation to rental of phonograms and films in Article 4 of Council Directive 92/100/EEC of 19 November 1992 (codified as Article 5 of Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006). Many Member States, including Belgium, Spain, Italy, Estonia, Germany, recognise such rights of remuneration that authors and performers (generally through their collective management organisations) can directly claim from economic actors exploiting their works (e.g. for cable retransmission, or for some secondary exploitations of an audiovisual work), even when the latter have cleared the rights from the producers to which authors and performers have transferred their rights. Some commentators have called for the introduction of such an unwaivable remuneration right for audiovisual authors. 30 It could also be an efficient mode of remuneration of performers. By applying such a solution, Member States separate the licensing of exclusive rights between economic operators, enabling them to engage in exploitation of creative content, and the remuneration of authors and performers, whose efficiency might be enhanced if properly managed by CMOs.”
Such right would seemingly exist in addition to their exclusive contractual rights; the ECS states that the reference to contractual freedom in Article 18 should not be used to undermine the rights of the author or performer to demand fair remuneration.
This academic opinion supports the performers' request for an unwaivable remuneration right administered collectively. This is the only proposal that can deliver proportionate and appropriate remuneration from streaming, as required by Article 18 of the Digital Single Market Directive.