HomeInsightsOrphan Works Regulations come into force


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This article was written by Alexander Ross, Partner and Sunniva Hansson, Solicitor, Wiggin LLP and first published in the Entertainment Law on 2 December 2014.

*Ent. L.R. 11  After extensive consultation, the new UK orphan works regime is on the statute books. Two sets of Regulations came into force on October 29, 2014: the Copyright and Rights in Performances (Licensing of Orphan Works) Regulations 2014,1 which allow for the licensed use of orphan works for both commercial and non-commercial use in the United Kingdom, and the Copyright and Rights in Performances (Certain Permitted Uses of Orphan Works) Regulations 2014,2 which implement the exceptions required by Orphan Works Directive.3


The final form of the Regulations follows the proposals in the Government’s technical consultation, which took place between January 10 and February 28, 2014. As a result of the responses received, the Government has made some minor changes to the legislation, as explained in its response to the technical consultation.

The UK scheme

The Copyright and Rights in Performances (Licensing of Orphan Works) Regulations 2014 allow for the lawful use of orphan works within the framework of copyright law by placing an authorising body in the role of the absent rightholder. The authorising body is to be the Intellectual Property Office. It will consider applications to use orphan works, determine the licence fee the user has to pay, grant the licence to use the work and hold the monies for the absent rightholder for a specified period.

A licence to use an orphan work will be granted only after a diligent search has been conducted in accordance with the Regulations.

The main changes that came out of the consultation and which have now been incorporated into the Regulations are set out below.

Time limit on claiming remuneration and unclaimed funds

In its consultation, the Government asked whether there should be a time limit on the period in which a rightholder can claim his/her remuneration. There was no consensus on the issue.

The Government decided to set a time limit on its financial liability of eight years during which a returning rightholder may claim remuneration. This has now been included in the Regulations.

This means that from the date on which an orphan works licence is issued by the IPO, an absent rightholder will have eight years to come forward and claim the licence fee which the IPO is holding on their behalf. The IPO will retain the discretion to pay remuneration in exceptional circumstances where a rightholder appears after this time, but it will have no obligation to do so.

After the eight year period is up, the Regulations allow the Government to access unclaimed licence fees, and the first call on the unclaimed funds will be the set up and running costs of the orphan works licensing scheme. While the power to disburse unclaimed funds rests with the authorising body, any decisions on the use of unclaimed funds will be made by the Secretary of State. Any surplus funds may, for example, be used for social, cultural and educational activities.

Right of appeal

In its consultation, the Government asked whether there should be a right of appeal for users of orphan works in the event of unreasonable actions by the authorising body, i.e. the IPO. It also asked whether such a right of appeal should cover:

•licence fee tariffs (e.g. via the Copyright Tribunal);

•refusals to grant licences; or


There was a consensus in favour of a right of appeal on both grounds.

Accordingly, the Government decided to include in the Regulations a right of appeal to the Copyright Tribunal, both in respect of licence fee tariffs and also against a refusal to grant a licence. This is similar to existing arrangements for non-orphan works licensing.

In addition, rightholders will have a right of appeal through the First Tier Tribunal if the IPO has either acted improperly or failed to comply with its obligations under the Regulations.

Implementation of the Directive

The Orphan Works Directive provides a limited exception to copyright for cultural institutions in the European Union such as museums and archives to upload *Ent. L.R. 12  material onto their websites for some types of orphan works. The Directive aims to make Europe’s cultural heritage available online, across the European Union, by providing greater access to works that are only currently available in a museum, archive or library for on the spot reference.

As the Directive allows only non-commercial use by specific beneficiary organisations there is no requirement to set money aside for absent rightholders, but compensation should be paid if they do reappear. There is also no independent verification of the diligent searches. The main amendments made to the UK’s implementing Regulations, as a result of the consultation, are set out below.

Sources for diligent search

The consultation asked whether further sources should be added to the list of essential sources to be used when carrying out a diligent search.

As a result of the responses, the Government amended the Regulations so that they now provide for guidance on diligent searches to be drawn up that will include suggested sources for cultural organisations to consider (including collecting societies). The guidance is being produced in conjunction with sector-specific groups representing literary works, film and sound and still visual art.

Fair compensation for rightholders

In the consultation, the Government asked whether there should be an appeals process on the level of fair compensation and who should administer it. There was consensus from respondents that an appeals process was needed.

Accordingly, the Government approached the Intellectual Property Enterprise Court (“IPEC”) to discuss which would be the most appropriate body to administer the appeals process. IPEC advised that the Copyright Tribunal would be best placed to fulfil this function. As such, the Regulations now name the Copyright Tribunal as the appeals body.


The Regulations providing for the domestic scheme are essentially a result of the recommendations made by Professor Ian Hargreaves in his Review of Intellectual Property and Growth. The Government committed to the introduction of a UK scheme to license orphan works in its 2012 policy statement, Modernising Copyright.

Despite concerns being voiced by stakeholders, the amendments to the first draft Regulations did not address the fundamental issue of compatibility of the domestic scheme with EU law. Article 6 of the Orphan Works Directive adds a further exception to infringement to the list of exceptions in art.5 of the Copyright Directive,4 but the new exception is strictly limited in its availability to the beneficiaries listed in art.1(1), and it is also limited to certain copyright works. TheOrphan Works Directive does permit the generation of revenue in the course of the permitted use by the beneficiaries, but only for the purpose of covering the costs of digitising and making available the orphan works. Commercial organisations are excluded from the list of permitted beneficiaries (except as a supplier of services to one of the permitted beneficiaries).

Under the UK scheme, however, the mandatory exception required by the Orphan Works Directive is introduced, but under the additional Hargreaves licensing scheme any user can potentially obtain a licence to use an orphan work, and that licence can permit commercial use for any purpose. Is this incompatible with EU law by going to far? It is hard to conclude otherwise.

The exceptions to infringement set out in art.5 of the Copyright Directive are exhaustive, and art.6 of the Orphan Works Directive adds one further limited exception. No further exceptions are permitted. Moreover, as Recital 20 of the Orphan Works Directive makes clear, the art.6 exception must comply with the three-step test, i.e. it may be applied only in certain special cases that do not conflict with the normal exploitation of the work or other protected subject-matter and do not unreasonably prejudice the legitimate interests of the right holder.

While the new domestic regime is referred to as providing a licensing scheme, it does for all intents and purposes appear to constitute a new exception: it limits the exclusive rights of the authors of copyright works. It also potentially permits the commercial exploitation of those works. It is unlikely that describing it as a licensing scheme can render it compatible with the Copyright and Orphan Works Directives. To all intents and purposes the Government appears to have introduced an new exception to copyright through the back door.

A further consideration is that collective management organisations must in practice be licensing orphan works on a regular basis, particularly if it is remembered that if all co-authors of a copyright work are identifiable but just one author cannot be located then the work is an orphan work to the extent of that author’s interest. This is no doubt even more likely to be the case when the organisation is licensing on an extended collective licensing basis, and will not know before the licence is issued whether the work in question is an orphan work or not. It is unclear how the reality of collective licensing squares with the new orphan works regime.

Ent. L.R. 2015, 26(1), 11-12

1. Copyright and Rights in Performances (Licensing of Orphan Works) Regulations 2014 (SI 2014/2863).
2. Copyright and Rights in Performances (Certain Permitted Uses of Orphan Works) Regulations 2014 (SI 2014/2861).
3. Directive 2012/28 on certain permitted uses of orphan works [2012] OJ L299/5.
4. Directive 2001/29 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L167/10.