Transfer of Value – How Article 17 levels the playing field

Article 17, formerly Article 13, directly addresses an issue that is commonly known as the Transfer of Value.

The Transfer of Value, also referred to as the value gap, is the funnelling away of value from creators into the hands of a number of online platforms, such as YouTube, Vimeo, SoundCloud, Facebook etc..

Over the past decade, user uploaded content platforms have become the most popular way for people to access music and other creative works. This has its advantages, such as allowing creators to share their work far more widely than ever before. However, the downside is that these same creators were not being remunerated fairly, if at all, for their work, leading to a huge market imbalance that threatened their livelihoods.

Read more about the issue and how Article 17 will bring sweeping positive changes below.

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Unaccountable hosting services

For a long time, platforms hid behind the loophole of being unaccountable hosting services. Despite their significant market share and the huge amounts of money generated – from advertising and other means – by providing access to creative works, platforms were failing to share this profit fairly, if at all, with the creators.

The result was that big platforms grew, and in the process became household names, but at the expense of creators, who found themselves struggling to live off of their work. The Transfer of Value also threatened the sustainability of the whole creative sector by distorting the market for legitimate online businesses. Businesses that cleared rights from creators, paid their taxes and employed people in Europe were at a disadvantage up against the free-riding platform services who captured the larger share of online traffic and revenues while hiding behind the ambiguity of the rules to avoid remuneration of creators and rightholders.

Correcting the Transfer of Value

What does Article 17 actually say?

Want to know more about the issue?

Legal analyses

- - ALAI communicates its opinion on Article 13 of the proposal for a Directive on copyright in the Digital Single Market as adopted by the trialogue. See document (EN | ES)

- - ALAI communicates its opinion in respect of some questions for preliminary ruling by the CJEU in case C-682/18 (YouTube). See document
  - European Data Protection Supervisor comments on the proposal for a Directive on copyright. See here
  - ALAI further reflections on the value gap, addressing Member State questions on Article 13 of the Copyright Directive proposal here and here

- - ALAI Opinion on the Copyright Directive proposal provisions on transfer of value (world’s most authoritative copyright professors) available here

- - An article by Prof Silke von Lewinski in the Kluwer Blog available here

- - Legal Analysis by Prof Agnes Lucas Schloetter available here

- - Paper by Dr Eleonora Rosati analysing the CJEU decision in the Pirate Bay case, available here

- - A blogpost by Dr Eleonora Rosati: “The value gap proposal in the JURI Committee Report as a consolidation of the existing framework (not the end of the internet)”, available here

- - Report by the French academic Prof. Pierre Sirinelli on the communication to the public right, prepared for the French Ministry of Culture’s CSPLA (available in French and English)

- - During the Academic Round Table event in November 2017, Prof. Antoon Quaedvlieg prepared the following presentation as well as a memo (in Dutch) written for the Dutch Copyright Committee here

- - A report by Prof. Matthias Leistner titled “Is the CJEU outperforming the Commission?” which looks at CJEU case law and the Commission’s proposal regarding ToV which you can read here

- - A study by Prof. Udo Di Fabio, former judge at the Federal Constitutional Court in Germany, entitled “Urheberrecht und Kunstfreiheit unter digitalen Verwertungsbedingungen“ (“Copyright and Freedom of the Arts under Digital Market Conditions”). this study looks at copyright from a constitutional point of view. The book version can be bought here.

- - The Kluwer Copyright Blogpost by Prof. Dr. Jan Bernd Nordemann that counters the argument that the ‘preventive measures’ (i.e. content recognition) mentioned under article 13 are something new and would kill the internet.

For further reading

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Extra information can come here

Article13 In February 2014, GESAC welcomed the adoption of the Collective Rights Management (CRM) Directive. The Directive highlights the key role of collective management organisations (CMOs) in negotiating deals with licensees and securing fair remuneration to creators. It aims at setting European-wide standards of transparency and governance, which are essential to ensure that relationships with rights holders and users are based on confidence.

And the first ALAI European Authors’ Right Award goes to…

On the evening of 14 May, GESAC and ALAI played host to the first-ever ALAI European Authors’ Right Award Ceremony. The purpose of the award is to encourage young researchers and students to pursue research in the area of authors’ right. Together, GESAC and ALAI hope to promote the next generation of experts on authors’ right.

A major achievement for Europe: GESAC welcomes the final adoption of the Copyright Directive

Brussels, 15 April 2019 – The European Council of Ministers decided to formally adopt the Copyright Directive today. The adoption follows on from the European Parliament’s positive vote on 26 March. The EU institutions have aligned to stand-up against free-riding tech giants’ manipulation and properly regulate their use of creative content. The new Directive will bring an end to the current unfairness in the market and empower creators.