drm, tpm and the private copy exception - coreach iprcoreach-ipr.org/documents/reinout van...

Molengraaff InstituutCentrum voor Intellectueel Eigendomsrecht

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DRM, TPM and the private copy exception

Reinout van Malenstein

CIER


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Outline

I. IntroductionII. Changes the Internet brought to copyright law III.Technological enforcement of copyright on the

Internet: TPM and DRMIV.Legal protection of DRM and TPMV. Reproduction rightVI.The private copy exceptionVII.Problems between the private copy exception and

protection of technological measuresVIII.Ideas for the future


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I. Introduction

• Shiro Perlmnutter (WIPO ALAI Congress 2000 Stockholm):• Two future scenarios for Copyright law on the Internet:

– 1. Rightholders loose control over exploitation works, works hacked after publication and freely distributed on the net. Internet as a worldwide copying machine

– 2. TPM and DRM makes piracy practically impossible, end-user pays per byte of copyright protected work

• Question: Can copyright law adapt to the new digital era in which copyright protected works are being distributed on the Internet, without ending up in one of the above scenarios?


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II. Changes the Internet brought to copyright law

• In the beginning: law online and offline should be the same

• Position changed with WIPO Internet Treaties as adopted in Geneva on 20 December 1996 (WIPO Copyright Treaty (WCT) and WIPO Performances and Phonograms Treaty (WPT))

• Basic differences online/offline1. No physical carrier2. Local exploitation by the end-user3. No territorial borders


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(1) No physical carrier

– Transformation from material to immaterial world• Barlow: “Selling wine without bottles”

Results:1. No physical property protecting the work2. No exclusivity3. No loss of quality (as compared to e.g. XEROX copying

machine) + more options as sound, images , text.


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(2) Local exploitation by the end-user

• Change in the behaviour of consumers

• From passive (reading a book, listening to CD, watching a movie) to active (copying and exploiting copyright protected work by using the internet

• Thus becoming: civilian competitor of original rightholder

• Publishing houses local consumer/exploiter operating from home.

• Result: difficult to enforce copyright law on the internet


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(3) No territorial borders

• Work can be published in country with ‘bad’ copyright enforcement and with the press of one button be distributed to the rest of the world by using the internet


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Result of differences online/offline

• Problems with copyright law on the internet

• Need for effective means to ensure copyright protection online

• Focus point: Prevention

• Clark: “The answer to the machine is in the machine.”

• Solution: TPM and DRM?


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III. Technological enforcement of copyright on the internet: TPM and DRM

• Technological Protection Measuress (TPM)

• Digital Rights Management (DRM)

• Function: enable rightholders to control access to and the use of copyright protected works on the Internet

• Goal: Establishing perfect exclusivity and excludability of the copyright protected work on the internet


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Technological Protection Measures (TPM)

• Definition in Art. 6.3 Directive 2001/29/EC (Infosoc Directive):– any technology, device or component that, in the normal course of its

operation, is designed to prevent or restrict acts, in respect of works or other subject-matter, which are not authorised by the rightholder of any copyright

– Technological measures shall be deemed "effective" where the use of a protected work or other subject-matter is controlled by the rightholders through application of an access control or protection process…which achieves the protection objective.

– Examples: encryption technologies, audio and video encoding standards, communication protocols, scrambling or other transformation of the work or other subject-matter or a copy control mechanism.

– because they exist of access control mechanisms or the encrypted protection of the work by restrictions to the use and codification of pieces of digital content to secure the transfer of the work between trusted locations of storage.


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Digital Rights Management (DRM)

• Definition in Art. 7.2 Infosoc Directive:– ‘…any information provided by rightholders which identifies the work

or other subject-matter referred to in this Directive or covered by the sui generis right provided for in Chapter III of Directive 96/9/EC, the author or any other rightholder, or information about the terms and conditions of use of the work or other subject-matter, and any numbers or codes that represent such information.

– Example :Rights Expression Languages (RELs), because they provide conditions, such as declaring the rights and permissions of the use, to the use of a digital work into digital languages by means of metadata; watermarking


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Examples of DRM and TPM (Continued)

• TPM and DRM work preventive. • Anti-copying measures:

– make it more time-consuming, expensive, impossible or more difficult to copy the copyright protected work

• Access-control:– prevents access to a work (like cinema ticket) – disables every operation of a user.– Only by going into DRM license agreement can paying end-

users gain access to the work (password, download, view) – Result: rightholder receives more operational powers for the

protection of his copyright protected work.


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• Encryption:– secures an information file by ‘locking it’. The user receives

the ‘closed’ information file and can open this file to get access to the copyright protected work by means of a ‘key’ to decrypt the information file.

– Possibility of extra requirements: • only open or copy the copyright protected work a limited

amount of times, • the amount of time the work can be opened/used, appoint the

persons who can use the work.


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• Software of DRM system equipped to abide by the condtions of the given DRM-license. – result, the rightholder can control more uses than given to

him by in copyright law.

• Conditions are metadata. – By means of eXtensible Rights Markup Language (XrML),

with which the Metadata is encrypted in the information, the software and hardware can understand what can and what cannot happen to the work, under which conditions, and who the rightholder is.

• To ensure that metadata cannot be altered easily: integrate metadata in digital watermark


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• Watermarking:– integrate the metadata into a digital watermark.

• the work will be automatically damaged when someone tries to remove the watermark.

• The watermark thus serves as a copy- and distribution security. – embeds individual information about work and right holders,

• Determine user of the copyright protected work in a watermark. • identifiable in case of infringing uses. • rightholder can see which ‘uploader’ has violated the DRM

license and infringed upon his copyright.


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Advantages of DRM and TPM

• Protect copyright protected works online • Provide a fast and easy tool for rightholders to secure

licenses with the end-user with regard to the use of a certain copyright protected work

• Control the usage of the content, • Collect information about such usage.

• Result: Less piracy


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Disadvantage of DRM and TPM

• Can be circumvented– e.g. by using the brute-force method.

• Solution: Protecting DRM and TPM against circumvention


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IV. Legal Protection of DRM and TPM:International legal framework

• TPM Art. 11 WCT

• DRM Art. 12 WCT

• EU implements these with 2001/29/EC (Infosoc Directive)


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Protection of DRM and TPM:Infosoc Directive

• Article 6 Infosoc Directive• Obligations as to technological measures• 1. Member States shall provide adequate legal protection against the

circumvention of any effective technological measures, which the person concerned carries out in the knowledge, or with reasonable grounds to know, that he or she is pursuing that objective.

• 2. Member States shall provide adequate legal protection against the manufacture, import, distribution, sale, rental, advertisement for sale or rental, or possession for commercial purposes of devices, products or components or the provision of services which:

• (a) are promoted, advertised or marketed for the purpose of circumvention of, or

• (b) have only a limited commercially significant purpose or use other than to circumvent, or

• (c) are primarily designed, produced, adapted or performed for the purpose of enabling or facilitating the circumvention of,

• any effective technological measures.


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Article 6 Infosoc (continued)

• 6.4.1. Notwithstanding the legal protection provided for in paragraph 1, in the absence of voluntary measures taken by rightholders, including agreements between rightholders and other parties concerned, Member States shall take appropriate measures to ensure that rightholders make available to the beneficiary of an exception or limitation provided for in national law in accordance with Article 5(2)(a), (2)(c), (2)(d), (2)(e), (3)(a), (3)(b) or (3)(e) the means of benefiting from that exception or limitation, to the extent necessary to benefit from that exception or limitation and where that beneficiary has legal access to the protected work or subject-matter concerned.

• 6.4.2 A Member State may also take such measures in respect of a beneficiary of an exception or limitation provided for in accordance with Article 5(2)(b), unless reproduction for private use has already been made possible by rightholders to the extent necessary to benefit from the exception or limitation concerned and in accordance with the provisions of Article 5(2)(b) and (5), without preventing rightholders from adopting adequate measures regarding the number of reproductions in accordance with these provisions.


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Article 6 Infosoc (continued)

• 6.4.4. The provisions of the first and second subparagraphs shall not apply to works or other subject-matter made available to the public on agreed contractual terms in such a way that members of the public may access them from a place and at a time individually chosen by them.

• So, DRM license contracts are immune to copyright exceptions


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Article 7 Infosoc Directive

• Article 7• Obligations concerning rights-management information• 1. Member States shall provide for adequate legal protection against any

person knowingly performing without authority any of the following acts:• (a) the removal or alteration of any electronic rights-management information;• (b) the distribution, importation for distribution, broadcasting, communication or

making available to the public of works or other subject-matter protected under this Directive or under Chapter III of Directive 96/9/EC from which electronic rights-management information has been removed or altered without authority,

• if such person knows, or has reasonable grounds to know, that by so doing he is inducing, enabling, facilitating or concealing an infringement of any copyright or any rights related to copyright as provided by law, or of the sui generis right provided for in Chapter III of Directive 96/9/EC.

• 2. The first subparagraph shall apply when any of these items of information is associated with a copy of, or appears in connection with the communication to the public of, a work or other subjectmatter referred to in this Directive or covered by the sui generis right provided for in Chapter III of Directive 96/9/EC.


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Pros and cons protection of DRM and TPM

• Advantage– Legal weapon against circumvention, hacking and

infringement

• Disadvantage:– Protection too broad?

• Private copy exception?


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V. Reproduction right

• Article 2• Reproduction right• Member States shall provide for the exclusive right to authorise or

prohibit direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part:

• (a) for authors, of their works;• (b) for performers, of fixations of their performances;• (c) for phonogram producers, of their phonograms;• (d) for the producers of the first fixations of films, in respect of the

original and copies of their films;• (e) for broadcasting organisations, of fixations of their broadcasts,

whether those broadcasts are transmitted by wire or over the air, including by cable or satellite.


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Legal basis reproduction right

• considerations of justice and public interest– Justice:

• fair that the author of the work derives a right for his achievement for creating a work. After all, without his achievement, there would not be a work.

• Public profits from the creation of new works. – The public interest:

• stimulation of anyone to deliver and invest in intellectual and cultural achievements by the creation of works.


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VI. Private copy exception

• Legal basis:– Public interest of the end-user:

• constitute a privilege to others than the rightholder of the copyright protected work, to use the work in a reasonable manner without the consent of the rightholder, while not-withstanding the monopoly granted to the rightholder of the copyright protected work.

• Every country due to its own political, economical and cultural situation, has different public interests– Yes or no to private copy exception


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Private copy exception:International legal framework

• Art. 9.2 Berne Convention

• Art. 10 WCT

• Art. 13 TRIPs

• EU: Art. 5.2.b Infosoc Directive


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Private copy exception:Infosoc Directive

• Art. 5 Infosoc Directive• Exceptions and limitations• Art. 5.2.b. Infosoc Directive:

2. “Member States may provide for exceptions or limitations to the reproduction right provided for in Article 2 in the following cases:

(b) in respect of reproductions on any medium made by a natural person for private use and for ends that are neither directly nor indirectly commercial, on condition that the rightholders receive fair compensation which takes account of the application or non-application of technological measures referred to in Article 6 to the work or subject-matter concerned;"


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Conditions for the private copy exception

1. Natural Person2. Private Use3. Non-commercial4. fair compensation to rightholders

– Recital 35 requires that the level of fair compensation take full account of the degree of use of technological measures

– May be implemented by levy systems or compulsory licensing schemes administered by collecting societies

5. Three step-test Art. 5.5 Infosoc Directive


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The three step-test

• Art. 5.5 Infosoc Directive:

“The exceptions and limitations provided for in paragraphs 1, 2, 3 and 4 shall only be applied in certain special cases which do not conflict with a normal exploitation of the work or other subject-matter and do not unreasonably prejudice the legitimate interests of the rightholder.”

• All three steps of the test are cumulative!


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Purpose of the test

• a limitation on permitted copyright exceptions to the exclusive rights of the rightholder

• aims to give a certain amount of discretion to national legislation in order to customize its legislation to social, cultural and economic needs.

• From an economically perspective, the copyright exceptions that pass the three-step test only infringe a little

• to create a balance between the exclusive rights of the rightholder and the copyright exceptions of the end-user


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Purpose of the test

• not created to restrict copyright exceptions!– rather allows and encourages Contracting Parties to make

national exceptions to the exclusive rights of rightholders in the digital era. (See Agreed Statement Art. 10 WCT)


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Step 1: Certain specific cases

• ‘Certain’:– copyright limitations must be clearly defined. – According to United States – Section 110 (5) of the US

Copyright Act WTO panel report, there is no need to identify explicitly each and every possible solution to which a copyright limitation could apply, provided that its scope is known and particularized.

• ‘Special’ – a limitation must be rationally justified. Examples for

rationally justified exceptions are: academic and scientific research, education and access to information.


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Step 2: not conflict with normal exploitation

• Normal exploitation:– Only actual or potential markets of considerable economic or

practical importance should be considered (see: United States – Section 110 (5) of the US Copyright Act, WTO panel report)

• Requires: – judgment on effects of the copyright exception on the

exploitation of the copyrighted work by the rightholder in the actual or potential markets of considerable economic or practical importance


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Step 3: not unreasonably prejudice the legitimate interests of the rightholder

• ‘legitimate interest’:– supported by the relevant public policies or other social

norms concerning art. 30 TRIPs (According to Canada –Term of Patent Protection, WTO panel report)

– also includes third party interests. According to United States – Section 110 (5) of the US Copyright Act, WTO panel report,

– especially the economic value of exclusive copyrights is to be taken into account.


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Step 3: not unreasonably prejudice the legitimate interests of the rightholder

(Continued)• ‘unreasonable prejudice’,

– Only a prejudice that reaches an unreasonable level is prohibited.

– Can be derived from the justification of the existence of the copyright exception.

– Harm to the rightholders must be reasonable related to the benefits of the users.

– In case the objective underlying a limitation justifies the harm to the rightholders legitimate interests, it can be approved.

• Can be made reasonable by means of equitable remuneration


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VII. Problems between private copy exception and protection of DRM and TPM

• Art. 6 and 7 Infosoc Directive ignore private copyexception of Art. 5.2.b Infosoc Directive

• Therefore ignoring Art. 11 and 12 WCT: – According to Article 11 and 12 WCT, technical measures

are not eligible for legal protection when they restrict acts that the law allows on merits of public policy (i.e. copyright exceptions).

• Result:– Cannot use private copy exception because of TPM and

DRM and their legal protection


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Questions

• Should the private copy exception be allowed on the outcome of the application of the three-step test, or instead be made dependable on the legal protection of anti-circumvention of TPM and DRM?

• Should Art. 6 and 7 Infosoc Directive be applicable in case there is no copyright infringement?


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Private copy exception or protection of technological measures?

• Change national law within limits of Infosoc Directive?

• Depends on status of private copy exception in a country:– Positive towards private copy exception Change– Negative towards private copy exception No change– Impartial towards private copy exception Can change

• Every Member State can decide for itself – Balance of interest between private copy exception and

protection of technological measures


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VIII. Ideas for change

1. Private copy exception as mandatory exception to the anti-circumvention law of TPM and DRM

1. Fair-use by design

3. Something different?


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(1) Private copy exception as mandatory exception to the anti-circumvention law of

TPM and DRM• Mandatory exception, so no deviation possible• In harmony with the BC, TRIPS and the WCT

– These treaties do not prevent national copyright laws from ensuring the effective enforcement of copyright exceptions for specific reasons of public policy.

• Art. 6.4.4 Infosoc DRM contractual agreements infringe upon mandatory copyright exceptions new provision: any (unilateral) contractual clause deviating from the mandatory copyright exceptions null and void


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(1) Private copy exception as mandatory exception (Continued)

• Inspiration: – EC Directive on the legal protection of computer programs

(Software Directive). • This Directive determines that exceptions provided in the

Directive may not be circumvented by contractual agreement. • These exceptions are stated in Articles 5 and 6 Software

Directive, and are given a mandatory status in article 9.1 Software Directive. According to this Article, any contractual provisions contrary to Article 6 or to the exceptions provided for in Article 5.2 and 3 shall be null and void.


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(1.2) Fine-tuning of the private copy exception

• In order for mandatory status, exception needs fine-tuning:– copying is a necessary step toward the creation of new

works. • For scientific and academic research, copying is necessary in

the early stages of the research to inform the researcher about the current state of affairs. To encourage research and the creation of new works in these areas, the private copy exception for these purposes should thus definitely become a mandatory copyright exception to the anti-circumvention law of Article 6 and 7 Infosoc Directive

• . Some restrictions might be necessary to apply, for example, to the number of allowed copies with regard to this exception.


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(1.2) Fine-tuning of the private copy exception (continued)

• However, a mandatory private copy exception to anti-circumvention law outside the academic and scientific research sphere might not be a good idea with regard to a free copy of an entertainment industry related copyright protected work.

• Protection of the exclusive right of the rightholder might become endangered with regard to his normal exploitation of the work.


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(1.2) Fine-tuning of the private copy exception (continued)

• different legal treatment the private copy exception:• consumptive or productive purposes • Examples:

– differences with regard to:• the type of use effectively undertaken by the end-user• the type of work used • the fields of creativity where the use occurs.


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(2) Fair use by design

• ‘Fair use by design’ – the technological rights system incorporates a system which

is technically designed only to inhibit copyright infringement, and, at the same time to enable users rights by default.

• Changing the rights-language of DRM-systems, technological measures can be made very flexible to allow different uses and protect certain rights. As a result, copyright exceptions can thus easily be incorporated in the rights-language of DRM-systems to ensure their enforcement to the end-user.

•


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(2) Fair use by design

• Revision of Art. 6 and Art. 7 Infosoc Directive:• in order to be legally protected against circumvention,

technological measures are required to build in copyright exceptions in their technology as much as is possible under the current technology

• All technological measures failing to implement such a system should be excluded from the protection of Art. 6 and Art. 7 Infosoc Directive

• Difficult to realize monitored and enforced by an administrative authority


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(3) Something different?


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Conclusion

• Balance of interests between protection of technological measures and copyright exceptions

• Every Member State can decide for itself– However: stay in line with the Infosoc Directive

– What is your opinion?


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Thank you for your attention!

• Any questions?

• [email protected]

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