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There are at least two directives relevant to the daily operations of the creative industry for which the transposition deadline has already passed without result in Poland: Directive 2019/790 on copyright and related rights in the Digital Single Market and the EU updates to the, so-called, “SatCab” Directive.
These directives were due to be transposed in June 2021. However, in this article we can, unfortunately, only discuss the draft implementing legislation, since the legislative process is still pending and remains in the initial, pre-parliamentary stage.
In mid-February 2023, the European Commission referred Poland to the Court of Justice of the European Union (CJEU) for failing to implement EU law.
The new EU copyright laws, provided for in Directive 2019/790, regulate the relationship between rightholders and online platforms, as well as the remuneration of individual artists and creators. The new law also address the scope of protection for users’ online freedom of expression to facilitate the legal exchange of UGC.
In respect of television and radio programs, Directive 2019/789 regulates the ability of broadcasters to provide television and radio programs abroad via their online services, including, among others, obtaining licenses for the retransmission of television and radio channels.
Failed challenge. Poland against the DSM: Case C-401/19
On 26 April 2022, the CJEU issued its judgment in Case C-401/19, Poland v. Parliament and Council, concerning the DSM’s most controversial provision, Article 17, which provides for a new liability regime for the largest online content-sharing service providers. In practice – as emphasized by the CJEU – this regime merely requires that service providers apply automatic upload filters enabling the preventative evaluation of uploaded content.
Despite failing in its challenge, Poland has contributed to the system of safeguards for users’ exercise of their right to freedom of expression and information. According to the CJEU, the implementation of the DSM requires legal solutions which allow for a fair balance between various fundamental rights. Practically speaking, in the case of those EU Member States which directly transposed the wording of Article 17 into their legal systems (e.g., France, the Netherlands), it will be necessary for such states to make significant additional amendments to their laws to implement specific solutions which provide ex ante protection to the rights of users who post legal content or which allow user organizations to access information supplied by online content sharing service providers about how their practices function.
Strengthening the position of press publishers
Article 15 of the DSM Directive provides press publishers and agencies with certain related rights under which they will be entitled to decide what can be published or republished (inkling in the form of excerpts) by search engines, content aggregators, etc., and when such publication or republication can occur.
These rights are similar to those which the producers of phonograms and video games or radio and television broadcasters have already enjoyed for many years. More specifically, the rights in question are the exclusive right to authorize or prohibit the direct or indirect, temporary or permanent reproduction of a work (Article 2 of the INFOSOC Directive) and the exclusive right to authorize or prohibit any communication of works to the public (Article 3 of the INFOSOC Directive) – and, in this particular case, are now extended to press publications (whether or not they constitute a work).
According to the most recent draft of the implementing legislation, where press publishers and agencies exercise their right to make press publications (and fragments thereof) available for commercial purposes, the compensation owed shall be shared on a “50:50” basis. Journalists, photographers, graphic designers, etc. will be guaranteed a fair share of the compensation received by press publishers and agencies from their exercise of their related rights. According to the current draft, creators of press materials will be entitled to 50 percent of such compensation. Although rightholders are expected to be represented by a collective management organization (CMO), such an intermediary is not mandatory.
At present, the Ministry of Culture and National Heritage manages the system for the collective management of copyrights in Poland. In order to operate, each CMO must hold a license from the Ministry and such licenses are granted for each specific field of exploitation. This means that, if publishers and authors wish to take advantage of the strong negotiating position of a CMO, they will need to wait until the appropriate licenses are granted, which will likely take at least several months (if not years) after the new law comes into effect. The Directive’s transposition is expected to occur soon, but no specific details have yet been made available.
What about performers and film makers? VOD tax and VOD royalties
Since July 2020, VOD service providers are obliged to pay 1.5% of their revenues from subscription fees or advertising (whichever is higher) to the Polish Film Institute (which is commonly referred to as the “VOD tax”). In 2022, the Polish Film Institute received more than PLN 32.8 million in fees from on-demand audiovisual media service providers. This “tax” is intended to be used to support Polish film. The funds will be indirectly distributed to creators for motion picture projects, such as, for example, film production and the organization of film festivals and other related events.
The most recent Netflix original Polish series “Wielka Woda” (“High Water”), released in October 2022, was the second most-watched non-English language series on the platform, ranking in the top 10 in 78 countries, including the US, UK, France, Denmark, Turkey, Morocco, and Canada. Despite its immense popularity, under the Polish Copyright Act no royalties were owed to either the performers or creators. The transposition of Directive 2019/790 should bring an end to this strange situation.
The Polish audiovisual industry is waiting for a new law based on Directive 2019/790 which would allow the collection of royalties for audiovisual works distributed online or by VOD services. This issue was widely discussed after Netflix announced that they had agreed to start paying additional royalties to the on-camera cast and behind-the-scenes crews of its German-language original series produced within Germany, such “Dark” and “How to Sell Drugs Online (Fast)”. According to Netflix, these payments will be made in addition to any wages earned up-front and their value will depend on how well the show performs in terms of streaming.
As already noted, Poland is almost 2 years overdue in transposing Directive 2019/790. Since the compensation owed to the performers and creators of audiovisual works is subject to mandatory collective management, all interested parties will need to wait until the Ministry grants the appropriate licenses for the new fields of exploitation to the relevant CMO, which will likely take at least several months (if not years) after the new law comes into effect.
How is Poland approaching the update of the “SatCab” Directive?
The updated “SatCab” Directive (i.e., Directive 2019/789) includes a distinct definition for “direct injection”. The draft of the Polish implementing legislation includes direct injection within the definition of “retransmission”.
Of the options available, it appears that Poland will merge “direct injection” into the broadcast or retransmission of content, unfortunately the current draft legislation does not include a separate definition of “direct injection”.
The model chosen by the Polish Government could result in the mandatory participation of CMOs in the licensing process, which raises the risk of double charging for the same content (by charging both the initial broadcaster and the distributor). Thus, the practical aspects of new or amended provisions in the Copyright Act require thorough consideration from the perspective of their enforcement. Further, the danger of double charging broadcasters and distributors for the same content must be expressly eliminated by lawmakers.
… and a lot more to come.
Since the legislative process is still pending for all of the above issues, we recommend keeping an eye open for their eventual outcomes. If you, dear reader, are interested in receiving updates on these topics and other potential developments, we would be happy to share our thoughts.
Agnieszka Wiercinska-Kruzewska is a co-founder and senior partner at WKB, head of intellectual property and TMT team, also closely cooperates with the M&A team. A graduate of the Faculty of Law and Administration at Adam Mickiewicz University in Poznań, As a holder of the Soros Foundation scholarship at the Central European University in Budapest she completed an LL.M course in international commercial law. She advises clients on all aspects of copyright, industrial property, consumer law, unfair competition, personal data protection, internet domains, press law and protection of personal rights. Agnieszka has also extensive experience in legal advisory services concerning sensitive product marketing and gambling. Within her areas of practice, apart from providing ongoing advice, she represents clients in litigation and arbitration proceedings. She has many years’ experience in the acquisition of companies on private market.
POLAND
Poland’s long (but not love) story with the Directive on copyright and related rights in the Digital Single Market: How is Poland implementing new EU Directives related to the media and entertainment sector?
Written by Agnieszka Wiercinska-Kruzewska & Paulina Maslak-Stepnikowska
WKB Wiercinska, Kwiecinski, Baehr
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There are at least two directives relevant to the daily operations of the creative industry for which the transposition deadline has already passed without result in Poland: Directive 2019/790 on copyright and related rights in the Digital Single Market and the EU updates to the, so-called, “SatCab” Directive.
Agnieszka Wiercinska-Kruzewska
Paulina Maslak-Stepnikowska
Paulina Maslak-Stepnikowska is a member of the IP & TMT practice and specialises in intellectual property law, in particular copyright and industrial property, including in proceedings before national and international bodies. Paulina assists clients from the technology, retail, publishing and fashion industries (including press and book publishers, and shoes manufacturers) and the automotive market, advising on matters including national and international trademark protection, inventions, industrial and utility designs, as well as in contentious proceedings. She has advised entrepreneurs on developing strategies for the protection of products and technologies with regard to their commercialisation and distribution, as well as on infringements of their rights on the Polish and EU markets. Paulina has represented clients before courts, including the EU Trademarks and Designs Court in Warsaw, Polish Patent Office, EUIPO and WIPO. She is a recipient of a scholarship at the Ruprecht-Karls-Universität in Heidelberg and a graduate of postgraduate studies in intellectual property law at the H. Grocjusz Intellectual Property Rights Centre. She is also a co-author of a manual titled Turn Your Public On.
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