HomeInsightsNeed to Know – 2012.12.10

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General

European Commission agrees way forward for modernising copyright in digital economy.

British Copyright Council launches principles for Collective Management Organisations’ Codes of Conduct.

Representatives of UK creators and businesses urge Government to reconsider impending changes to copyright law.

Technology

European Patent Office (EPO) and State Intellectual Property Office of the People’s Republic of China (SIPO) launch Chinese-English component of EPO’s free automatic translation service Patent Translate.

Government publishes progress report one year after publication of Cyber Security Strategy.

Data Protection

European Commissioner Viviane Reding says she is willing to make changes to European data protection reforms.

Information Commissioner’s Office publishes statement in response to Leveson report.

Broadcasting

Ofcom finds material in FX’s animated comedy American Dad! was inappropriately scheduled.

Film & TV

Pact welcomes news from Chancellor of the Exchequer’s Autumn Statement about tax reliefs for TV and film production sector.

Gambling & Betting

Department for Culture, Media and Sport publishes draft Bill reforming remote gambling regulations in Great Britain.

Computer Games

TIGA welcomes Chancellor’s announcement in Autumn Statement of 25% Games Tax Relief.

Advertising

Committee of Advertising Practice publishes reminder of rules applicable to linking ads to news of Royal baby.

General

European Commission agrees way forward for modernising copyright in digital economy.

On 5 December 2012, the European Commission held a debate on content in the digital economy.  It said that, given that the digital economy has been “a major driver of growth in the past two decades”, its objective was “to ensure that copyright stays fit for purpose in this new digital context”.  Good progress has been made, it said, in implementing the May 2011 Intellectual Property Rights Strategy, but “there remain a series of issues which need to be addressed to ensure an effective single market in this area”.

The Commission says that it will work for a modern copyright framework that “guarantees effective recognition and remuneration of rights holders in order to provide sustainable incentives for creativity, cultural diversity and innovation; opens up greater access and a wider choice of legal offers to end users; allows new business models to emerge; and contributes to combating illegal offers and piracy”.

The Commission has agreed on two parallel tracks of action:

  • Immediate issues for action: launch of stakeholder dialogue: a structured stakeholder dialogue will be launched at the start of 2013 to work to address six issues where rapid progress is needed: cross-border portability of content; user-generated content; data- and text-mining; private copy levies; access to audiovisual works; and cultural heritage.  The discussions will explore the potential and limits of innovative licensing and technological solutions in making EU copyright law and practice fit for the digital age.
  • Medium term issues for decision-making in 2014: this will include the completion of relevant market studies as well as impact assessment and legal drafting work.  The aim is to reach a decision in 2014 as to whether to table legislative reform proposals.  The following four issues will be addressed together: mitigating the effects of territoriality in the internal market; agreeing appropriate levels of harmonisation; limitations and exceptions to copyright in the digital age; how best to reduce the fragmentation of the EU copyright market; and how to improve the legitimacy of enforcement in the context of wider copyright reform.  Based on the outcomes of this process the Commission will decide on the next steps necessary to complete its review of the EU copyright framework.

To read the Commission’s press release in full, click here.

British Copyright Council launches principles for Collective Management Organisations’ Codes of Conduct.

At a reception at the Supreme Court on 4 December 2012, the British Copyright Council (BCC) launched a new policy framework that provides Collective Management Organisations (CMOs) with a set of principles for individual Codes of Conduct.

According to the BCC’s press release, the importance of the principles was recognised in speeches by special guests Lord Marland, the current Minister for Intellectual Property and Dr Francis Gurry, Director General of the United Nations’ World Intellectual Property Organisation (WIPO) plus three other speakers.  The principles were unanimously praised as “a great step forward, not only in the self-regulation of UK CMOs but also in an international arena”.

Lord Marland spoke about the contribution of copyright to the economy and cited the BCC principles as an example of a forward-looking industry.  He said, “I am struck by how many industries in the UK are still looking backwards, whereas the UK copyright industry is looking forward”.  He added that the Government endorsed the initiative and understood the value of the content produced by writers and publishers.  

The framework sets out minimum standards for CMOs and for users of copyright.  Dr Gurry referred to the recent Hargreaves Review of Intellectual Property and Growth and Hooper’s Digital Copyright Exchange report when he said, “What is needed is a functional global and legal digital marketplace and what we have now is a functional global and illegal digital marketplace.  This will require a collaboration between the public and private sectors that was never previously necessary”.  He added that framework provided “another lead for the rest of the world” in these matters.  To read the BCC press release in full and for a link to the new principles, click here.

Representatives of UK creators and businesses urge Government to reconsider impending changes to copyright law.

A coalition of trade bodies representing a wide section of UK creators and businesses, including art, music, film, TV, print and publishing, argue that the broad scope of potential copyright exceptions expected to be announced later this month by the Intellectual Property Office will damage both economic and cultural growth.  The coalition is therefore urging the Government to reconsider impending changes to copyright law, which they say would “seriously restrict the ability of British creators and copyright holders to license and earn revenue from their rights”.

The coalition is instead supporting an alternative proposal entitled Licensing UK, which it says “supports creators’ rights to license businesses where value is being created”.  The proposal has been sent to Vince Cable, Secretary of State for Business, Innovation and Skills and the IPO in advance of any new policy being finalised.  To read the PRS for Music press release in full and for more information on the Licensing UK proposal, click here.

Technology

European Patent Office (EPO) and State Intellectual Property Office of the People’s Republic of China (SIPO) launch Chinese-English component of EPO’s free automatic translation service Patent Translate.

As a result of this launch the collections of the two largest languages in patents are now united as full-text documents on the same website through the EPO’s global patent database, Espacenet, and are linguistically accessible for innovators from both regions using a single tool, Patent Translate.  Under the new arrangement with SIPO, Espacenet has grown by 4 million Chinese language documents, adding to the 75 million documents already available.

Making the announcement at the annual bilateral meeting of the two offices in Brussels today, EPO President Benoît Battistelli said: “Thanks to the close relations between the EPO and SIPO, millions of patent documents in the two most important languages of technology are now freely available for engineers, inventors and scientists the world over.  This is a major contribution to strengthening the competitiveness of European businesses.  The European economy as a whole will benefit, as innovating companies will now be able to better target their R&D work by searching Chinese patent documents, while further improving the substance of their patent applications.  Patent offices, too, will be able to use the service in their daily work, which will positively impact on the quality of the patenting process…

With the addition of Chinese, Patent Translate now enables free on-the-fly-translation of patents from and into English for 14 languages.  Launched in February 2012 and integrated into the Espacenet database, Patent Translate is expected to enable machine translations of patents into all 28 official languages of the 38 member states of the EPO, plus Chinese, Japanese, Korean and Russian by 2014.  To read the EPO press release in full, click here.

Government publishes progress report one year after publication of Cyber Security Strategy.

The Strategy, launched in November 2011, provided Government with a framework and objectives in tackling cyber threats.  A year on from its publication the Government says that the Government is continuing to:

  • work to improve cyber awareness and risk management amongst UK business;
  • bolster cyber security research, skills and education;
  • tackle cyber crime in order to maintain the confidence needed to do business on the internet;
  • deepen national sovereign capability to detect and defeat high-end threats;
  • ensure robust and resilient UK systems and networks; and
  • help to shape international dialogue to create and support an open, secure and vibrant cyberspace.

As for future action, the Government has announced:

  • its intention to establish the first UK national CERT (Computer Emergency Response Team) to co-ordinate the national response to cyber incidents;
  • the establishment of a new joint Cyber Growth Partnership between industry and Government aimed at boosting the UK’s global market position in cyber security products and services.  Central to this will be a high level group which will identify how to support the growth of the UK Cyber security industry, with an emphasis on increasing exports;
  • the development of a military Cyber Reserve by the MOD to harness and attract the talents of cyber security specialists;
  • an initiative with the Institution of Engineering and Technology to ensure that all software engineering degree courses contain a mandatory module on cyber security from 2015;
  • Government support for the development of organisational standards for cyber security so consumers can identify those businesses with good cyber security practices and firms who are good at this can make it a differentiator in the marketplace;
  • the development of a permanent information-sharing environment for industry and Government called UK CISP (Cyber Information Sharing Partnership) to be launched in January 2013;
  • further initiatives to increase public awareness, including using HMRC’s channels of communications with business and the public, and building on the work of initiatives such as Get Safe Online.org and campaigns by the National Fraud Authority. 

To read the Government’s press release in full, including comments from Ministers, click here.

Data Protection

European Commissioner Viviane Reding says she is willing to make changes to European data protection reforms.

Speaking at the 3rd Annual European Data Protection and Privacy Conference in Brussels on 4 December 2012, Ms Reding said that “the fundamentals of my data protection reform are good for business” and will assist in establishing a “true digital single market”. 

Ms Reding said that it was right to build into the reforms the so-called “one-stop-shop” principle, which allows businesses to have just one supervisory authority to deal with.  The new Regulation also has “legal certainty”, she said, in the form of the “consistency mechanism”, which allows supervisory authorities to agree positions collectively across the EU.  “With our reform there will be one clear rule for all of the EU, with no contradictions.  This will make it much easier to conduct business across borders”, she said.

As for sanctions for non-compliance, Ms Reding said it was necessary to have a system “with teeth” to ensure that businesses take their data protection responsibilities seriously.  That is why the Regulation contains a tough fines regime.  “Promoting growth requires a robust administrative sanction system”, she said.

However, Ms Reding said that she has listened to MEPs, Member States, stakeholders and businesses and will take their comments and concerns into account.  For example, she has proposed scrapping the notification system as it is a “formality which has little added value from a data protection point of view” and it “represents a cost for business of 130 million euros a year”.  Ms Reding also acknowledged that red tape needed to be cut “even more”.  “We will look at the proposal and consider ways in which red tape can be cut without affecting the level of protection of personal data”, she said.

Ms Reding also said that she was “willing to consider following a more risk-based approach” where, as already exists in several areas in the legislation, the obligations of data controllers and processors are “calibrated to the size of the business (enterprises employing fewer than 250 persons) and to the nature of the data being processed”.  However, such an approach does not mean “let data controllers choose what they will do”, she said.  Instead, “we want to build an approach into the legislation that adequately and correctly takes into account risk”.  The approach must be “simple” to avoid increased costs and less legal certainty, but Ms Reding said, “I am prepared to go further”.

Another area that has been highlighted by stakeholders concerns the legal fragmentation caused by the public-private split where the public sector is removed from the scope of the Regulation and is allowed to operate under different rules.  Ms Reding said that businesses were “right to be concerned that some are advocating such a radical step away from the harmonized system that we proposed”, and she recognised that, while there will always be some areas where the public sector has the right to act differently from the private sector, “the overall principles must be the same”.

The debate has also highlighted the need to reconcile further flexibility and legal certainty within the Regulation, Ms Reding said.  She explained that the Commission had tried to tackle this by including delegated and implementing acts and that, although this was one way of achieving legal certainty, the Commission was “prepared to look at other ways to ensure an effective application of the rules”.  Several different solutions have already been considered, including adding more detail in the text, allowing the consistency mechanism to step in and make a decision, allowing codes of conduct and other business-led initiatives, or just deleting the act in its entirety.

Ms Reding concluded by saying that it was “worth continuing to engage in this fast moving debate” and that she expected Parliament and the Council to make swift progress by the end of the Irish Presidency.  To read the speech in full, click here.

Information Commissioner’s Office publishes statement in response to Leveson report.

The statement recognises that the report included comment on the ICO and the Data Protection Act 1998.

The ICO says that, from an initial reading, “it is clear the report offers much for the ICO to consider, and we’ll reflect on where improvements can be made to the ways in which we carry out our statutory duties”.

The ICO says it was “pleased to see the report support stronger sentences for people who steal or illegally trade in personal data”.  In the ICO’s view this should provide “a significant deterrent if implemented”.  The impact on the press would be minimal, it says, with an enhanced public interest defence available to journalists.

The ICO acknowledges that the report proposes significant changes to some parts of the Data Protection Act where the ICO is responsible for regulating compliance.  While this is a matter for the Ministry of Justice to consider, it says, it will be offering its views on the detail and practical effects of the proposals in a response to the Leveson Report, which it will publish early in the New Year.  To read the ICO statement in full, click here.

Broadcasting

Ofcom finds material in FX’s animated comedy American Dad! was inappropriately scheduled.

Ofcom was alerted by a viewer to scenes of violence in an episode of American Dad! broadcast before the 9 pm watershed on the FX channel, which included a character being stabbed with a knife and a protracted assault on another character.  The programme also contained aggressive innuendo and sexualised language with the dad taunting his son by making sexual boasts about his mother.

Fox International explained that this episode of American Dad! was given a 15 rating and that it should only have been shown after the watershed.  It explained that human error was the cause of the mistaken scheduling.

Ofcom considered that, although the stabbing was meant to demonstrate the comic transformation of a once violent teenager to a now caring mother, the character’s obvious delight in the killing and the image of the wounded girl dying meant that the material was unsuitable for children.  Ofcom found that the protracted violent physical assault and the sexual innuendo between father and son were also unsuitable for children. 

Ofcom said that while FX is primarily directed towards adult viewers and American Dad! is known to be an edgy comedy, it did not believe an audience (and in particular parents) would have expected cartoon content with this intense level of violence to be shown before the watershed on a Saturday evening.  Ofcom also took into account the fact that there was no warning to viewers before the broadcast, and that FX had itself decided that this episode was not appropriate to be shown before the watershed and was broadcast due to human error.  Ofcom therefore concluded that children were not in this case protected from unsuitable material by appropriate scheduling, and there was a breach of rule 1.3.  To read Ofcom’s adjudication on American Dad! Published in the Issue 219 of the Broadcast Bulletin (3 December 2012), click here.

Film & TV

Pact welcomes news from Chancellor of the Exchequer’s Autumn Statement about tax reliefs for TV and film production sector.

John McVay, Chief Executive of Pact, which represents more than 450 independent UK production companies, said: “The tax credits announced by the Chancellor as part of today’s Autumn Statement are great news for UK production – this will ensure UK productions currently made outside the UK are attracted back to Britain, and help attract inward investment to the UK.  We are looking forward to publication of the legislation and Pact is committed to working with government to support the future success of this critical support”.

The government’s announcement about investment in training for the creative industries is also good news for TV and film in the UK.  Stewart Till CBE, Chair of Creative Skillset and CEO of Sonar Entertainment, said: “Through the Treasury consultation on tax relief our industries have identified the UK’s skills and talent as one of the principal drivers of growth and of our global reputation.  We applaud the Government for taking this issue forward.  This much needed and welcome injection of one-off co-investment will help incentivise the delivery of training to develop skills that will support the growth in jobs that the tax reliefs will bring.  We are delighted that Creative Skillset will be progressing this crucial initiative”. 

Commenting on the extra money for training, John McVay said the Government had acknowledged the importance of the creative industries, and especially the multi-billion pound contribution made by the independent sector to the economy.  “This is a year-on-year growth sector that is renowned for its world-leading creativity, he said adding that “UK television export figures have never been better – this extra investment for entry-level and professional trainees will be welcomed by many companies”.  To read the Pact press release in full, click here.

Gambling & Betting

Department for Culture, Media and Sport publishes draft Bill reforming remote gambling regulations in Great Britain.

The DCMS says that the draft legislation will ensure greater protection measures for British-based users of remote gambling services, including online bingo, casino websites and telephone betting.

The Gambling (Licensing & Advertising) Bill will amend the Gambling Act 2005 so that remote gambling by consumers living in Britain is regulated at the point of consumption.  All operators selling into the British market will be required to hold a Gambling Commission licence to transact with British consumers and advertise in Great Britain, whether their operation is based here or abroad.

Further, overseas-based operators will be required to:

  • inform the Gambling Commission about suspicious betting patterns involving British customers, helping fight illegal activity and corruption in sports betting; and
  • pay and contribute to research, education and treatment relating to British problem gambling and regulatory costs.

The draft legislation was welcomed by the Chairman of the Gambling Commission, Philip Graf, who said: “We welcome the proposed changes as currently we regulate less than 20% of online gambling by British consumers and cannot insist on overseas operators providing us with information about suspicious sports betting transactions”.

A period of pre-legislative scrutiny of the Bill by the Culture, Media and Sport Select Committee will now begin with the aim of introducing it in the third session of Parliament.  To read the DCMS press release in full and for a link to the draft legislation, click here.

Computer Games

TIGA welcomes Chancellor’s announcement in Autumn Statement of 25% Games Tax Relief.

TIGA, the trade association representing the UK games industry, said that the commitment to introduce a 25% tax relief for video games development, animation and high-end television production would “provide a powerful boost to the creative industries”.

TIGA research has previously indicated that Games Tax Relief should generate and safeguard 4,661 direct and indirect jobs and £188 million in investment expenditure by studios.  The research also showed that it would increase the games development sector’s contribution to UK GDP by £283 million, generate £172 million in new and protected tax receipts to HM Treasury, and cost just £96 million over five years.

TIGA also hailed the decision to provide funding for training and development for the creative industries, but emphasised that resources need “to be allocated to management and leadership development and not simply to workforce training”.

TIGA also welcomed the reduction in corporation tax to 21% in April 2014 as well as the measures to promote ultra-fast broadband for cities including Brighton, Cambridge and Oxford, where clusters of games developers are based.

TIGA also said that the growth in UK Trade and Investment’s resources by 25% a year could help to support exporters.  However, it stressed that UKTI should use its Trade Access Programme scheme more flexibly.  Rather than simply giving grants to developers to exhibit at overseas trade shows, it should also assist exporters with their travel costs.  “This would enable many smaller games businesses to attend overseas shows and boost their ability to export”, TIGA said.

Dr Richard Wilson, CEO of TIGA, said: “Tax breaks for games production will ensure that the UK remains a world leader in the high technology video games development industry.  A single 25% level of relief will be simple to administer and economically impactful.  Yet we will have to monitor the actions of our competitors: the province of Quebec in Canada already boasts a 37.5% level of tax relief”.  To read TIGA’s press release in full, click here.

Advertising

Committee of Advertising Practice publishes reminder of rules applicable to linking ads to news of Royal baby.

The CAP reminds advertisers that linking campaigns to events is “likely to be tempting” but that advertising should not go as far as claiming or implying that a particular product is endorsed by the Royal Family or that a product is affiliated to royal events when it is not.  This is in line with the general provisions on misleading advertising.  The CAP Code urges marketers to obtain written permission before implying any personal approval of the advertised product and reminds marketers that those who do not want to be associated with the product could have a legal claim. 

Specifically, members of the Royal Family should not normally be shown or mentioned in a marketing communication without their prior permission (Rule 6.2) and the Royal Arms or Emblems must not be used without prior permission from the Lord Chamberlain’s Office.  Further, references to a Royal Warrant should be checked with the Royal Warrant Holders’ Association (Rule 3.52).

The CAP also reminds advertisers of the guidelines issued by the Lord Chamberlain’s office regarding the sale of souvenir products.  These state that advertisements for souvenir products are not, in and of themselves, likely to be considered to imply a Royal endorsement, although care should be taken in the copy to ensure that the ad does not imply that a souvenir product is official memorabilia.  In light of Rule 6.2, the CAP advises against using images which have been provided for souvenirs or other specific uses in marketing communications for unrelated products.  To read the guidance in full, click here.

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