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YouTube Among ‘Big Losers’ Under New EU Copyright Rules

Feb. 14, 2019, 7:09 PM

YouTube LLC and other video-sharing platforms will likely be hardest hit by new European Union copyright rules, intellectual property practitioners told Bloomberg Law.

The Feb. 13 agreement would overhaul EU copyright law by requiring content-sharing platforms to enter into licensing agreements with publishers and artists before posting copyright-protected content, and to create steps for removing potentially infringing content. The European Parliament and EU member countries must approve the agreement, but their votes are considered a formality.

“There are some very big losers, and those very big losers are the likes of YouTube,” Susan Hall, an IP intellectual property partner with Clarke Willmott LLP in Manchester, U.K., said.

Rights clearance is a large and expensive business,” Hall said, adding that platforms may have to pay more to rightsholders, who would have no obligation to conclude agreements with platforms.

The new rules mark “a big profit shift from the aggregators to the content providers,” said Edward Taelman, an associate with Allen & Overy (Belgium) LLP in Brussels. But following the law could prove difficult, he said.

Platforms may have to install upload filters to block unlicensed content, Taelman said. As for protected material, platforms will have to have “to proactively license as much copyrighted content as their best efforts allow"—a task that’s virtually impossible to do exhaustively due to the sheer volume of copyrighted material involved, he said.

But the rules could also have an upside of “effectively forcing rightsholders and platforms to work hand-in-hand to achieve a successful outcome,” said Sophie Goossens, counsel with Reed Smith LLP in Paris. “It will be fascinating to watch the system take shape.”

Alphabet Inc.’s Google, which owns YouTube, said it will study the final text of the EU copyright directive and determine its next steps.

“Copyright reform needs to benefit everyone, including European creators and consumers, small publishers and platforms,” Google said in an email to Bloomberg Law.

‘Hand-in-Hand’

The rules on content-sharing platforms obtaining copyright clearance is one part of the proposed law, while a separate provision centers on the rights of publishers in relation to news aggregation websites.

On publishers’ rights, the new rules say newspapers, magazines, and similar publishers can require platforms such as Google or Verizon Media’s Yahoo! to obtain licenses before republishing news articles or excerpts from news articles—unless only “individual words or very short extracts” are published.

Publishers have found it “very difficult to engage in licensing agreements” with Google and other platforms, Joy de Looz-Corswarem, EU affairs manager for the European Magazine Media Association and the European Newspaper Publishers’ Association, told Bloomberg Law.

In some countries, including Belgium and France, news publishers have reached compensation agreements with Google, but only after litigation, de Looz-Corswarems said. The new law would be “pan-European legislation, and there are not many ways for Google to escape from it,” she said.

To contact the reporter on this story: Stephen Gardner in Brussels at correspondents@bloomberglaw.com

To contact the editors responsible for this story: Rebecca Baker at rbaker@bloomberglaw.com Keith Perine at kperine@bloomberglaw.com