"ECJ ruling on private copying levy could lead to 'double dipping'"

The Supreme Court of Germany has asked for a preliminary ruling of the European Court of Justice (ECJ) on the question whether the copyright holders' right to 'fair compensation' for private copying is "abrogated where the right holders have expressly or implicitly authorised reproduction of their works".

This case has caused quite a bit of legal controversy. According to Intellect, a trade body for the UK technology industry, this ECJ case could lead to a "ludicrous situation" where rights holders have to be paid twice.

Intellect has called on the UK's Intellectual Property Office (IPO) to "intervene" in the case, which will review questions on fair compensation owed to copyright owners under a copyright levy system. Some European countries, e.g. the Netherlands, allow the unauthorised copying of material that a person legitimately owns, as long as that is for private use. Under the EU's Copyright Directive this is permitted when there is 'fair compensation' to the copyright holders. This compensation is ensured by charging a levy on the media – discs and media players – where files are typically copied on to. That levy is then transferred to rights holders by collecting societies.

Although not all EU Member States have a copyright levy system, Intellect said the questions posed by the German Supreme Court could have a "broad reach" and affect policymaking on copyright across Europe. "If the condition relating to fair compensation is not abrogated where the rights holders have authorised reproduction of their works, it would imply that entitlement to fair compensation (i.e. copyright royalties) is not exhausted when a license authorising the private copying use in question is in place," Intellect said in its submission to the IPO seen by Out-Law.com. This scenario, where rights holders benefit twice from the use of their work, is sometimes referred to as 'double dipping'.

This would indeed be a compelling legal situation. However, it is far from certain whether the ECJ will decide that the duty to compensate copyright holders for a private copy remains in place regardless of their permission to use their work.

Source:  Out-Law.com