UK Copyright Private Use Exception Problem

Copyright is the array of legal rights which assign to creative works around the world, grants creators the exclusive ability to restrict their works and permits certain uses by others1. Nevertheless, these exclusive rights are not absolute yet restrained by exceptions and limitations to copyright law, which listed in the Copyright, Designs and Patents Act 1988 (hereinafter CDPA 1988)2. The legislative intent aims to strike an appropriate balance between the legitimate interests of copyright owners and those desires of users of copyright material, in corresponding to the increasing economic growth and in digital age.

According to the UK copyright exceptions, in recent years, a new exception of ‘private use’ or ‘private copying’ was introduced by the Copyright and Rights in Performance (Personal Copies for Private Use) Regulations 2014 (Regulations) SI 2014/2361, under section 28B of the CDPA 1988. Unfortunately, it was quashed on 19 June 2015 by the High Court3. One of the reasons was because a number of music industry stakeholders claimed that this exception was unfair and prejudice to them.

To understand the problem of the application of private use exception in the UK copyright regime, this essay aims to provide an analysis of the case law of The Queen on the application of British Academy of Songwriters, Composers and Authors and others in order to answer the issue of why those stakeholders suffered prejudice to their legitimate interests from this exception and how fair is the private use exception. This essay divides into three parts. The first part seeks to examine the background and issues arisen in the above case law.

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The second part intends to provide a critical analysis of the actual problems of the above case law. Finally, the third part, there will be a conclusion of wholly matters as well as some recommendations to further resolve current problems regarded those issues.

The exception of ‘private use’ or ‘private copying’ came into force on 1 October 2014 by the CDPA 1988 under section 28B. As a result, any person who lawfully obtains content, including music, film or books, has rights to copy that work for his or her own private use without pursuing for infringement of copyright. It could be copied onto other formats or stored in the cloud, providing the copying was for private, non-commercial use and could not give or pass it to family members or close social acquaintances, such as friends and colleagues.

In accordance with the exercise of discretion under the InfoSoc Directive, 2001/29/EC, art 5(2)(b), however, the UK did not provide for any compensation scheme for rights-holders into that introduction. This set fire to a lot of controversy in an application of the UK private copying exception. One of the examples disputed in the case of The Queen on the application of British Academy of Songwriters, Composers and Authors and others. Principally, the main argument was on the decision of the UK government to not implement a compensation scheme.

Initially, several representatives of various authors and right owners launched for a judicial review of the new private copying exception on the basis that it was incompatible with with the InfoSoc Directive, 2001/29/EC, art 5(2)(b), as it did not include a fair compensation mechanism. Following that, the government argued that it no needed to provide the exception with the fair compensation funded through levies, as it was introduced a narrower exception limited to personal use, rather than use by friends and familial circles. Based on this consideration, there would be no harm to the right holder. Moreover, the Government’s stated justification for doing so was that any ‘relevant’ harm to the rights holders was deemed to have been already priced-in to the initial price of each content by the rights-holders. As such, there was minimal or zero harm for which compensation would be required.

Regarding the court’s judgement, the significance is that the decision to introduce section 28B in the absence of a fair compensation mechanism is unlawful. As the court considered the evidence relied on to justify the conclusion about harm was manifestly inadequate. Conclusively, it would appear that there is now problematic, mainly with reference to the concepts of harm and fair compensation.

On the one side of those music industry bodies, one is asserted that those stakeholders may suffer prejudice to their legitimate interests from the absence of a fair compensation mechanism. Due to the fact that digitalisation and new technologies have diluted the ability of right holders to control their work and have allowed copyright works to be easily and costlessly disseminated to wider ordinary persons than ever before. For this reason, one is considered that the scale of ‘personal uses’ of private copying could be hard to actually limit consumers’ practices to be circumscribed for a sole person in reality, as the exception is technology neutral.

This means that it permits copying to all types of personal storage, including remote cloud storage11. It is asserted that it is difficult to determine the ‘generation’ of the copy, whether it is a copy made from a lawful copy or if it is a third generation copy. As a result, it could be claimed that these prejudicial effects of private use exception would seem to be conflict with a normal exploitation of the work and cause unreasonably prejudice the legitimate interests of the right holders. It is argued that it is imbalanced to them.

On the flipside of the UK government and consumers, it is considered that it would be cumbersome and a burden. The rights-holders would not suffer any harm because they had already priced and charged a higher price at the point of initial sale price. One criticises that the compensation schemes would appear to be inefficient, disadvantaged and unfair for the consumers or users. It would be extremely unduly burdensome and costly to them, as in this case consumers have already directly paid rights in accordance with the price-in system to the right- holders. One could wonder as to if the government introduces a fair compensation scheme to this private use exception, a duplication of burdens or double payment to the consumers cannot be avoided to come to light. One can also wonder how fair and balanced the users or consumers are given.

In conclusion, it can be concluded from the case that the main problem of a private use exception in the UK copyright regime was principally on the issue of concepts of harm and a fair compensation. To put it more accurately, it caused from diverse expectations and perspectives as to the legitimate interests between the right-holders and users. Consequently, one is suggested that the government should re-investigate the meaning of ‘pricing-in’ term and obtain more satisfactory evidence that the ‘harm’ caused by private copying will be no more than minimal.

Alternatively, they should introduce a scheme to compensate rights holders through a levy, but also extend the private copying exception beyond personal use so that it covers copying for family and friends. Above all, one is asserted that it should take every parties’ interests into account in order to secure a proper balance for everyone as a satisfactory fair game.