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17 Jun 2014

Pérez-Llorca: Trying to Protect Intellectual Property in the Digital Environment

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Author: Sara de Román

 

Spanish intellectual property legislation is currently subject to review. In line with the recommendations of the International Intellectual Property Alliance, the protection of intellectual property rights in the digital environment has become increasingly more important. Therefore, the new draft legislation not only intends to amend the Intellectual Property Law but also the Civil Procedure Act, which introduces legal measures for combatting online piracy.

One of the most significant additions of the bill affects the limitation on copyright regarding quotes. In response to continued requests by newspaper publishers, the draft recognizes an unswayable right to fair compensation whenever news aggregators or readers reproduce non-significant excerpts in periodical publications or websites for informative or entertainment purposes. This development has already been coined as the “Google levy” in Spain, and tries to respond to a request that has been addressed, from different perspectives in France, Germany and Belgium, among other European countries. However, the lack of a definition of what “significant excerpts” means, and the obvious difficulty of guaranteeing this new right has led to uncertainty over its feasibility. In addition, the National Competition Commission has questioned the need for such a right, given the free technical solutions that already exist which allow intellectual property rights holders to avoid protected content aggregation. The Spanish competition authority also understands that recognizing this right would lead to considerable market barriers for new aggregators or readers, which is likely to be detrimental to consumers, insofar as it would reduce competition.

With this bill, the scope of the limit to private copying will be reduced. Reproductions of works that have been made available to the public in accordance with contracts in which such reproduction is authorized, and reproductions that cause a minimal damage to the rights holder do not give rise to copying levy. Therefore, this reduction will result in a remarkable decrease in the amount of the copying levy, which is paid from the general State budgets and has to be calculated according to the damage caused.

Collective management of copyright and related rights entities are also affected by the reform. In order to promote transparency and efficiency, the bill regulates these entities’ obligations, in particular regarding accountability, and its disciplinary system. The First Section of the Intellectual Property Commission ‒ an administrative body attached to the Ministry of Culture ‒ plays a key role in relation with such organizations, given that the draft legislation entitles this commission to also set rates as well as to have its mediation and arbitration functions. On the other hand, in order to facilitate intellectual property rights payments by users, the bill requires collective management organizations to act as a one-stop shop on the internet.

The purpose of improving intellectual property rights protection in the digital environment takes two concrete forms in the bill: the powers entrusted to the Second Section of the Intellectual Property Commission and the introduction of two new preliminary proceedings in the Spanish Civil Procedure Act.

Firstly, the bill sets out a “procedure to restore legality” which can be initiated by the Second Section of the Intellectual Property Commission –at its own initiative or at the request of intellectual property rights holders or collective management entities– against those internet service providers (ISPs) that significantly infringe intellectual property rights. The referred procedure can also be initiated against ISPs that actively and non-neutrally provide the description or placement of works that seem to be offered without authorization, that is to say, websites that contain links to other websites. The bill entitles the Second Section of the Intellectual Property Commission to order the interruption of an internet service or the removal of contents after prior notice to the ISP in order to cease and desist. According to the bill, the voluntary interruption of the service or the removal of the contents by the ISP after such notice is an admission of the infringement. In the event that the ISP does not cease its infringement, the Second Section of the Intellectual Property Commission is also entitled to request the collaboration of other ISPs for the implementation of the measures taken against the said ISP. However, this collaboration shall be requested once authorization has been obtained from the competent judicial authority. In any case, failure to comply with the requirement to remove content ‒ two or more times ‒ shall carry fines of up to 300,000 euros, and may entail the cessation of the infringer’s activities for a maximum period of one year.

Secondly, the new preliminary proceedings proposed in the bill will allow the intellectual property rights holder to request from the judge the identification of an ISP or a user when there are reasonable grounds for suspecting that they are distributing protected content on a grand scale without complying with legislation, and when such acts cannot be considered as being carried out by mere consumers acting in good faith. In the view of the State Prosecutor’s Office, the preliminary proceedings, when affecting users, does not observe the principle of proportionality because priority is given to intellectual property rights over the constitutional right to privacy of communications. The Spanish Data Protection Agency understands that the bill should clarify in which cases of intellectual property rights infringement it will be possible to request the necessary data to identify an ISP, paying particular attention to its intentionality.

In short, it is obvious that the Spanish legislator has made an effort to enhance intellectual property rights protection. It is now a question of waiting to see to what extent these proposals will become part of intellectual property legislation.

 


Press release provided by the company.