Contact
October 1, 2012
It is intended for reference purposes only and does not constitute definitive advice. Links to the original source materials are included where there are no restrictions in terms of access. References may also be made to sources that require separate registration or subscription. A link to a source does not necessarily imply endorsement of the source or the material provided through the link. For further information on any of the matters discussed in this summary please contact Alexander Ross. If you have any comments, queries or suggestions please contact us at comments. All suggestions and comments are most welcome. If you do not wish to receive this summary you can contact us at unsubscribe@wiggin.co.uk.
General
UK Government consults on Late Payment Directive.
EU Media Futures Forum releases final report complementing the executive summary and recommendations published in June 2012.
Government responds to BIS Select Committee’s report on Hargreaves’ Review of Intellectual Property and Growth.
European Parliament approves Directive on orphan works.
Technology
Director of Public Prosecutions makes statement on prosecutions and social media.
Office of Fair Trading launches new tools to help online businesses improve service to people living in remote areas.
Data Protection
European Data Protection Supervisor publishes formal comments on European Commission’s consultation on procedures for notifying and acting on illegal content hosted by online intermediaries.
Broadcasting
Ofcom finds British Sky Broadcasting Ltd fit and proper to hold broadcasting licence.
Litigation
Patents County Court finds that changes made to photograph amounted to derogatory treatment pursuant to s 80 Copyright, Designs and Patents Act 1988.
Publishing
Publishers’ Association’s sales monitor shows total invoiced value of digital fiction book sales increased 188% by value in January to June 2012 in comparison to same period in 2011.
Computer Games
TIGA, the trade association representing the UK’s games industry, calls for input into cultural test for games tax relief.
Advertising
ASA finds Ryanair ad misled consumers because the conditions required to be fulfilled in order to obtain the advertised price were not clear.
ASA finds use of “nhs” in URL by non-NHS affiliated service in breach of CAP Code.
UK Government consults on Late Payment Directive.
This consultation seeks views on the UK’s implementation of the Late Payment Directive (2011/7/EC). The Directive covers all debts incurred in commercial transactions and applies to businesses and public authorities, whether the transactions are within the UK or effected across EU borders.
This consultation is on the recast Directive, which, the Government says, will extend existing laws and practices currently enjoyed by British businesses across the EU, creating a level playing field for UK businesses trading with other businesses and public authorities in all Member States.
The main points outlined in the Directive are that:
- public authorities will be required to pay suppliers within 30 calendar days of receipt of an undisputed invoice (this matches the UK Government’s standard practice for the public sector);
- for business to business payments, the period for payment fixed in a contract should not exceed 60 days, unless otherwise expressly agreed and provided such terms are not grossly unfair;
- it copies current UK practice of a default payment period of 30 days, where terms have not been agreed; and
- there is a minimum €40 (approximately £31) for compensation (current UK legislation sets three levels of compensation payment according to the value of the payment). Suppliers will not be prevented from seeking to claim additional recovery costs.
The consultation will run until 19 October 2012. Transposition of the Directive is due to take place on 16 March 2013. To read the Government’s press release in full and for links to the consultation documentation, click here.
EU Media Futures Forum releases final report complementing the executive summary and recommendations published in June 2012.
In December 2011 European Commissioner Neelie Kroes established a group to reflect on the impact of the digital revolution on European media industries, the resulting risks and opportunities for these industries for consumers and citizens, and the emerging new business models against a background of economic uncertainty and reduced revenue for traditional media.
The aim of the Forum was to foster debates on the future of EU media and issue recommendations on how best to incentivise quality content and journalism while seizing the benefits of the digital revolution.
In June 2012 the Forum published its executive summary of the report, which sent a “wake-up call” to Europe. It made eight recommendations:
- Europe must be a digital single market by 2015;
- Promote new business models that protect personal data but provide consumer benefits;
- Reward creators and the creation of content;
- Adapt financial support for audiovisual creation;
- There must be equitable regulatory and fiscal principles for offline and online businesses;
- Avoid new barriers to entry;
- Increase access to and use of legal content and services from anywhere in the EU on any device for all citizens in the EU; and
- Quickly roll out the infrastructure for the future.
The final report of the Forum explores in more detail the discussions that took place between the members during the Forum meetings. The report highlights the key trends, opportunities and challenges of the sector, as well as the solutions to overcome them. For a link to the final report, click here.
Government responds to BIS Select Committee’s report on Hargreaves’ Review of Intellectual Property and Growth.
Both the Committee and Government support the notion of “seeking a solution on private copying (including format-shifting)”. The Government says it will look into the evidence relating to actual lost sales versus opportunities for further revenue, noting that any potential exception would be “sufficiently narrow to cause only minimal harm to rights holders, thus not requiring a system of compensation such as a levy”.
In respect of parody, the Government seems to be leaning towards a fair dealing exception, underpinned by an unchanged moral rights framework.
As for content mining, the Government, together with the Committee, recognises the value of the technology and the need to support it further while minimising risks. The Government says that it is “determined to develop a framework which gives the best support to research over the long term, which includes maintaining successful and secure research publishing”.
The Committee had recommended that the Copyright Designs and Patents Act 1988 be updated to reflect the changes that have taken place in technology. The Government, however, does not think that a review of the Act could be delivered “easily or swiftly” and that it is a “moving target”. Whilst recognising the Committee’s concerns, the Government believes that the immediate priority is “to act where change is needed now” and that it is proposing “a considerable group of measures for implementation”.
On orphan works, the Government says that it welcomes the support for an orphan works scheme provided that appropriate protection for rights holders is included. In notes that it has already proposed powers for the Secretary of State to implement a scheme subject to certain safeguards.
As for the Digital Copyright Exchange, the Government welcomes the Committee’s support and says simply that it “… look[s] forward to Mr Hooper’s report”.
The Government is keen that collecting societies adopt codes of conduct and, following the recent consultation, it says it will be publishing minimum standards on which such codes should be based. In addition, it says it will legislate for a reserve power to put in place a statutory code for a collecting society that fails to self-regulate. However, statutory regulation should be a last resort.
As for enforcement in respect of piracy and online infringement, the Government says that the recent High Court decisions requiring ISPs to block file-sharing of infringing content “is welcome” and that it intends to continue implementing the online infringement of copyright provisions in the Digital Economy Act 2010. To read the Government’s response in full, click here.
European Parliament approves Directive on orphan works.
The text, approved by 531 votes to 11 with 65 abstentions, and already informally agreed by Parliament and Council, aims to make it safer and easier for public institutions such as museums and libraries to search for and use orphan works. The new rules would protect such institutions that use orphan works from future copyright infringement claims.
Under the new rules, a work would be deemed to be “orphan” if a “diligent” search made in good faith failed to identify or locate the copyright holder. The legislation lays down criteria for carrying out such searches.
Works granted orphan status would then be made public, for non-profit purposes only, through digitisation. A work deemed to be “orphan” in any one Member State would then qualify as “orphan” throughout the EU. This would apply to any audiovisual or printed material, including a photograph or an illustration embedded in a book, published or broadcast in any EU country.
MEPs agreed that the rights holder should be entitled to put an end to the orphan status of a work at any time and claim appropriate compensation for the use made of it. They nonetheless inserted a provision to protect public institutions from the risk of having to pay large sums to authors who come forward later. Compensation would have to be calculated case-by-case, they said, taking account of the actual damage done to the author’s interests and the fact that the use was non-commercial. This should ensure that compensation payments remain small.
The text also now includes an article to allow public institutions to generate some revenue from the use of an orphan work (e.g. goods sold in a museum shop). All of this revenue would have to be used to pay for the search and the digitisation process. To read the European Parliament’s press release in full, click here.
Director of Public Prosecutions makes statement on prosecutions and social media.
The DPP, Keir Starmer QC, has said that “if the fundamental right to free speech is to be respected, the threshold for criminal prosecution has to be a high one and a prosecution has to be required in the public interest”.
In a statement regarding the message posted by Daniel Thomas, a semi-professional footballer, on the social networking site Twitter relating to the Olympic divers Tom Daley and Peter Waterfield, the DPP said that the question is whether any message posted is so grossly offensive as to be criminal and, if so, whether a prosecution is required in the public interest. In that case, the CPS Wales decided not to prosecute. The message was no doubt offensive, but not so grossly offensive to warrant criminal charges. “Context and circumstances are highly relevant and as the European Court of Human Rights observed in the case of Handyside v UK (1976), the right to freedom of expression includes the right to say things or express opinions “… that offend, shock or disturb the state or any sector of the population”, the DPP said. In this case, Mr Thomas’ posting was “a one-off offensive Twitter message” and, in the context, it was not necessary to prosecute.
As for social media generally, the DPP said that the CPS has the task of balancing the fundamental right of free speech and the need to prosecute serious wrongdoing on a case-by-case basis. This “often involves very difficult judgment calls”. In some cases it is clear that a criminal prosecution is the appropriate response, e.g. where there is a sustained campaign of harassment of an individual, where court orders are flouted or where grossly offensive or threatening remarks are made and maintained. However, in many other cases a criminal prosecution will not be the appropriate response, he said.
To ensure that CPS decision-making in these cases is clear and consistent, the DPP said that he intends to issue guidelines on social media cases for prosecutors. In the first instance, the CPS will draft interim guidelines. There will then be a wide public consultation before final guidelines are published. As part of that process, the DPP also intends to hold a series of roundtable meetings with campaigners, media lawyers, academics, social media experts and law enforcement bodies to ensure that the guidelines are as fully informed as possible. To read the DPP’s statement in full, click here.
Office of Fair Trading launches new tools to help online businesses improve service to people living in remote areas.
The OFT has launched new online resources to help internet businesses “comply with the law and provide a better service to residents living in remote areas of the UK”.
Earlier this year, during its call for evidence on the challenges facing consumers living in remote communities, the OFT says that it heard from people who were unhappy about delivery costs being presented late on in the buying process, who felt misled by sites that promised “free UK delivery” but imposed shipping charges, or let down by suppliers refusing to deliver to remote locations.
In order to ensure online businesses are meeting their legal obligations to customers in these areas, the OFT has now launched new online resources, which advise online businesses that to be compliant with the law, they should:
- display delivery charges clearly and early on in the purchasing process;
- make sure any additional charges imposed on delivery to remote locations are justified and displayed clearly and early on in the purchasing process;
- check that when the term “Free UK Delivery” is used, it is not misleading, for example, if it does not include remote locations;
- recognise it may take longer to deliver to remote locations and explain this clearly and early on in the purchasing process;
- only refuse to deliver to remote locations if it is justified by objective criteria, for example, additional costs incurred because of the distance; and
- allow customers to return faulty goods free of charge, and to return unwanted goods that fall within the statutory seven-day cooling off period free of charge unless customers have been notified in writing that charges would apply.
To read the OFT press release in full and for links to the online resources, click here.
European Data Protection Supervisor publishes formal comments on European Commission’s consultation on procedures for notifying and acting on illegal content hosted by online intermediaries.
Essentially, the EDPS expressed concern that notice and action procedures must “respect fundamental rights, including the rights to data protection and to privacy”.
The EDPS recognised that there was a need for a more harmonised definition of the notion of “illegal content” for which notice and action procedures are applicable. However, such procedures may imply the processing of personal sensitive data, which would require additional safeguards in terms of data protection.
Not all categories of “illegal content” should be the subject of notice and action procedures, the EDPS said. Some categories, such as privacy infringements, might be best reported to data protection authorities.
The EDPS agreed with the Commission that there is “currently too much legal fragmentation and uncertainty for hosting service providers and notice providers”. He supported a clarification of the notion of “hosting”, but noted that any revised definition should not affect the liability of service providers under data protection law since their activities involve the processing of personal data of individuals.
As for notifying illegal content to hosting service providers, the EDPS supported the implementation of harmonised procedures to help reduce national divergences and “provide more legal certainty to all stakeholders”. Procedures should: a) respect the confidentiality of the notice provider; b) consider the implications of handling the notice provider’s personal data; c) be transparent and it should be easy to challenge a service provider’s decision to take down material; and d) consider cooperation with law enforcement authorities. Further, unjustified or abusive notices should be subject to rules and possible sanctions.
As for action against illegal content, the EDPS recognised that there are cases where law enforcement authorities need to analyse the illegal content in the context of criminal investigations and that removing the content may limit such investigation. A better classification of the types of illegal content would help to distinguish notices requiring the involvement of other authorities from those that do not.
As regards proactive measures to be taken by hosting service providers to prevent illegal content from being posted, the EDPS said that the types of measures being referred to need clarification. He noted in particular that Article 15 of the E-Commerce Directive (2000/31/EC) clearly sets out that service providers do not have a general obligation “to monitor the information which they transmit or store, nor a general obligation actively to seek facts or circumstances indicating illegal activity”. The question was, therefore, whether the types of measures sought from hosting providers would be lawful under the Directive and under the E-Privacy Directive (2002/58/EC), as well as whether they would be considered proportionate under the Data Protection Directive (95/46/EC). To read the EDPS’ comments in full, click here.
Ofcom finds British Sky Broadcasting Ltd fit and proper to hold broadcasting licence.
Following the revelations regarding phone hacking at newspapers owned by News Group Newspapers Ltd, Ofcom has considered evidence made available to it in order to assess whether BSkyB remains a fit and proper broadcast licensee under s 3(3) of the Broadcasting Act 1990 and 1996.
Ofcom said that it considered the wrongdoing of the kind alleged to have taken place at the newspapers owned by NGN to be capable of being relevant to the fitness and propriety of a broadcaster notwithstanding the fact that such wrongdoing was not related to the performance of broadcasting functions. However, it noted that there was no evidence of BSkyB being directly or indirectly involved.
Essentially, Ofcom considered whether any person able to exert influence over BSkyB was implicated in or tainted by alleged or admitted wrongdoing or criminality at the newspapers in such a way as to raise questions about BSkyB’s ongoing fitness and propriety. It therefore examined the character and conduct of: (i) James Murdoch (director of BSkyB and of News Corporation, which owns 40% of Sky plc) (ii) Rupert Murdoch (Chairman and CEO of News Corporation); and (iii) News Corporation.
Ofcom decided that James Murdoch’s conduct in relation to events at NGN “repeatedly fell short of the conduct to be expected of him as a chief executive officer and chairman”. It considered James Murdoch’s conduct to be “both difficult to comprehend and ill-judged”. However, there was no evidence that gave a reasonable basis to conclude that he had deliberately engaged in any wrongdoing.
As for Rupert Murdoch, Ofcom said that the evidence did not provide “a reasonable basis on which to conclude that [he] acted in a way that was inappropriate in relation to phone hacking, concealment or corruption by employees of NGN or News International”. The same was true of News Corporation.
Ofcom said that it was conscious of ongoing investigations by other agencies and that it would be concerned if it was subsequently found that News Corporation had “exerted pressure over politicians and others in support of News Corporation’s commercial interests, went beyond the legitimate areas of political debate and transgressed into inappropriate pressure or behaviour related to furthering News Corporation’s commercial interests”.
Overall, notwithstanding Ofcom’s views in relation to James Murdoch’s conduct, it did not consider that BSkyB was no longer fit and proper to hold broadcast licences. Although James Murdoch’s conduct fell short of the standard to be expected, Ofcom did not consider his retention as a non-executive director of BSkyB meant that the company was not fit and proper to hold broadcast licences. Further, whether it was appropriate for James Murdoch to be a director in light of the events was a matter for the Board and shareholders of BSkyB.
Finally, Ofcom noted that its duty to be satisfied that a licensee is fit and proper is ongoing. Further evidence may become available in the future that Ofcom would be obliged to consider in order to fulfil its duty. In particular, Ofcom recognised that the findings of the Leveson inquiry and the results of pending criminal proceedings could be relevant. To read Ofcom’s decision in full, click here.
Patents County Court finds that changes made to photograph amounted to derogatory treatment pursuant to s 80 Copyright, Designs and Patents Act 1988.
In a judgment handed down in May 2012, but which has only just been published, the Patents County Court has found a breach of the moral rights of the claimant author of the photograph in question and, further, that the defendant had infringed the claimant’s copyright by reproducing the work on its website.
The photograph in question was taken by the claimant, Emma Delves-Broughton, in 2005. It depicted a model in a forest wearing a garment supplied by the defendant, House of Harlot Ltd. Ms Delves-Broughton claimed for infringement of copyright on the grounds that House of Harlot had used the photograph for six months on its website without permission. She also complained of derogatory treatment pursuant to s 80 of the CDPA as a result of changes made to the work by the defendant, including removal of the forest background, reversal of the image and cropping to make the image smaller. House of Harlot said that it had consent to use the photograph pursuant to an oral copyright licence and disputed that changes made to the photograph amounted to derogatory treatment.
It was clear from the evidence that Ms Delves-Broughton had granted permission to use the photograph to the model, but had not granted any such permission to anybody else. Therefore, the court found that no copyright licence had been granted to the defendant and that, as a result, it had infringed Ms Delves-Broughton’s copyright when it reproduced the work on its website.
As for the claim of derogatory treatment, the court found that considerable time and effort had gone into the composition and creation of the original photograph and that it was important to Ms Delves-Broughton that the forest background appeared in the work for artistic reasons. The judge was therefore satisfied that the changes made to the photograph constituted a distortion of the work. “I would not say that it was mutilation and I would not say that it was prejudicial to the honour or reputation of the author or director, but I am satisfied that it amounts to distortion of the photograph in question…”, he said. The treatment of the work was therefore found to be derogatory pursuant to s 80 of the CDPA. (Emma Delves-Broughton v House of Harlot Ltd [2012] EWPCC 29 (18 May 2012) – to read the judgment in full, click here).
Publishers’ Association’s sales monitor shows total invoiced value of digital fiction book sales increased 188% by value in January to June 2012 in comparison to same period in 2011.
The Publishers’ Association figures show that other strongly performing categories include children’s digital books and digital non-fiction books, which increased by 171% and 128% respectively during the same period. Overall, the Association says, digital sales of general consumer titles (including fiction, non-fiction and children’s) increased from £30 million to £84 million between January to June 2011 and 2012.
These increases reflect overall growth of 89.1% in digital sales (from £77 million to £145 million), while physical book sales fell 0.4% by value (from £985 million to £982 million) and 3.8% by volume (from 260 million to 251 million) over the period.
As for the total value of sales (digital and non-digital), the Association’s figures show an increase of 6.1% in January to June 2012 in comparison to the same period in 2011. Digital sales accounted for 12.9% of the total value of sales in January to June 2012, up from 7.2% in the equivalent period in 2011.
Richard Mollet, CEO of the Association, said: “The results of The Publishers Association’s Sales Monitor show that British publishing continues to perform strongly despite difficult economic conditions. In particular, the huge increase in digital sales shows how rapidly readers and publishers are embracing e-book reading. Whether books are enjoyed physically or electronically, publishers will continue to invest in exciting authors and titles. They can do this because of the stability provided by the UK’s robust and flexible copyright framework. This is why The PA is at the forefront of calls to government to ensure that copyright is not eroded and that creators’ rights are protected and supported online”. To read the Association’s press release in full, click here.
TIGA, the trade association representing the UK’s games industry, calls for input into cultural test for games tax relief.
To qualify for games tax relief in the UK games will need to pass a cultural test, as required by the EU. TIGA is currently working with the UK Government to help determine the details of this test. TIGA is now requesting the views of developers, digital publishers and the wider UK gaming community on the content of this test.
The fundamentals of the cultural test for video games will be similar to the one that exists for film tax credit, but TIGA would like the input of members and of the wider industry to help influence a cultural test that is suited to the gaming industry and which will capture the cultural elements of videogames. Games will secure points if their content meets fundamental features of the cultural test.
Fundamental features include:
cultural content: British or European locations, characters, literature, film, and language;
British heritage: British or European cultural heritage or mythology;
creativity: innovations in gameplay, graphics, audio, physics or functionality;
cultural hubs: development within the UK; and
cultural practitioners: creative input from UK or EEA nationals.
Other questions TIGA suggests considering, include: Should the test focus on the creators or the content of a game? What elements of British culture should be represented more in games? Should diversity and regional differences be reflected in the cultural test? Can science fiction and fantasy games reflect British culture? Should innovation in game design be rewarded in the test? Should art involved in games production be rewarded in the test?
Dr Richard Wilson, CEO of TIGA, said: “TIGA’s aim is to strengthen the UK games development and digital publishing sector and to ensure that the industry contributes to economic growth. Video games can be cultural products and provided that the cultural test is designed to reflect the nature of video games, then the culturally based Games Tax Relief will give a powerful boost to the UK games sector”. To read TIGA’s press release in full, click here.
ASA finds Ryanair ad misled consumers because the conditions required to be fulfilled in order to obtain the advertised price were not clear.
A national press ad for an airline, viewed on 10 February 2012, was headed “MALMÖ WITH RYANAIR from £14.99 one way”. Text within the footnote stated “Book until midnight 13.02.12. Travel days: Mon-Thurs. Travel in Apr. Subject to availability. Terms and conditions apply, see Ryanair.com for details. Fares exclude optional fees/charges. Flights from London (Stansted)”.
The complainant challenged whether the price was misleading, because he understood that customers paying with a non-Ryanair credit or debit card would be charged an additional fee and the only way to avoid the charge was to pay with a Ryanair payment card, which consumers had to pay for.
Ryanair said the footnote made clear that the advertised fare was available to all consumers who chose to avoid optional fees and charges by either using MasterCard Prepaid or Ryanair’s Cash Passport card. Ryanair also explained that the initial cost of £6 for the Cash Passport was immediately redeemable against the cost of the first flight purchased using the card.
The ASA noted that consumers who were not in possession of the Cash Passport at the point of purchase could not immediately purchase tickets for the advertised price; rather they needed to apply for the card and await delivery. It was therefore concerned that that delay might result in consumers being unable to obtain the advertised price.
The ASA considered the fact that consumers were required to load the card with a minimum of £150 and the fact that additional charges applied to its use were significant conditions which the consumer needed to know about in order to make an informed decision about the advertised price. Because this material information was not made clear in the ad, the ASA found that the ad breached CAP Code rules 3.1 and 3.3 (Misleading advertising), 3.7 (Substantiation) and 3.17 and 3.18 (Prices). To read ASA Adjudication on Ryanair Ltd (19 September 2012) in full, click here.
ASA finds use of “nhs” in URL by non-NHS affiliated service in breach of CAP Code.
A sponsored search ad stated “EHIC Apply Now – EHIC Replaces the E111 Card. www.nhs-services.org.uk/EHIC Get Your Official EHIC Now!”
The ASA received a complaint that the ad was misleading because the URL “www.nhs-services.org.uk” implied a link with the NHS.
The ASA acknowledged that the website included text at the end of a paragraph on the home page which stated “This website is not connected to or affiliated with the NHS or any government department”. Nonetheless, it considered that the use of the term “www.nhs-services” in the URL did imply that the advertiser was the NHS, which consumers would know to be the official provider of health services in the UK. Because that was not the case, the ASA concluded that the ad was misleading. The ad therefore breached CAP Code rules 3.1, 3.3 (Misleading advertising), 3.7 (Substantiation) and 3.50 (Endorsements and testimonials). To read ASA Adjudication on Esta Visa Ltd (19 September 2012) in full, click here.
Expertise
Topics
Wiggin's expertise, delivered direct to you
