At the end of April 2013, the Enterprise and Regulatory Reform Act was granted royal assent, and amidst the raft of changes it heralds to employment tribunals, whistleblowing protections and the establishment of a new Competition and Markets Authority, were several important changes regarding copyright which directly affect visual artists. DACS has followed the passage of this Act and participated fully in the process where it affected the rights of visual artists.

 There are two key elements of the Act that are currently of particular of interest to visual artists:

1. Extended Collective Licensing

The Act allows the Secretary of State to regulate on extended collective licensing (ECL), which enables licensing solutions for rightsholders and users where it is impractical to license rights individually. The new Act seeks to enable licensing bodies to apply to operate an ECL scheme, should rightsholders support this.

It is understood that the regulations enacting the law will only allow collecting societies to operate an ECL and in order to do so they must fulfil a number of criteria, including demonstrating that they are sufficiently ‘representative’ of the relevant rightsholder group. And any particular ECL will need the approval of a sufficient number of rightsholders, and authorisation by the Secretary of State, stating clearly the types of works it applies and which rights it is supposed to cover.

This means that copyright protected works can still only be used under licence. If, for example, photographers do not collectively agree to an extended collective licence, then that licence will not come into effect and the use of their works under that scheme would not be allowed.

What DACS thinks: DACS has 30 years’ experience of protecting the rights of visual artists and more than 10 years’ experience of paying collective royalties to thousands of fine artists, photographers and illustrators every year through our Payback scheme.
 DACS’ position on this issue has remained consistent – we firmly believe rights should not be licensed collectively if rightsholders wish to reserve the right to exercise their exclusive rights themselves. Rightsholders should be free to choose what is licensed collectively, and what is licensed directly.

Rightsholders must also be able to opt out of any ECL scheme.
 83% of the rightsholders who responded to a survey by DACS in 2012 felt that with the appropriate safeguards in place, they could support extended collective licensing. However, we are alive to the worries expressed by some visual artists about the possible negative impact on their ability to control the use of their works, and the concern that collective licensing arrangements are likely to undermine or destroy their existing and developing primary markets.

As the new Act is merely enabling legislation – additional regulation is required to flesh out the details of how extended collective licensing will work in the UK – DACS will be following the drafting of the regulations carefully and will intervene to safeguard the interests of visual artists.

2. Orphan Works

The new Act allows for the licensing of orphan works for both commercial and non-commercial use. For a work to qualify as an orphan work the Act says that a diligent search for the rightsholder needs to have taken place, although no detail is given about what constitutes a ‘diligent search’. A licensing body can license the use of orphan works and maintain a register of possible orphan works that rightsholders can search to see if their work appears on it. 

It is intended that the regulations enacting the law will stipulate that licensees will pay a fee upfront should they wish to use an orphan work. These fees will be held for the rightsholder in case they reappear. Where the author of the work is known (but cannot be found), they will be credited when the work is used. Where the author of the work isn’t known, details will be given about how the rightsholder can go about claiming ownership of their work.

What DACS thinks: DACS shares the concern that the Act allows for the licensing of orphan works for commercial uses as this potentially undermines existing markets, particularly that of professional photographers. It is critical that the cost of licensing an orphan work must be comparable to market rates, in order to prevent this from happening. More significantly, any orphan works scheme should seek to prevent the creation of new orphans in the future. This issue has not been adequately addressed.

DACS is concerned that the Government is not doing enough to make it clear that the stripping of rights management information/ metadata is an infringement. Not enough is being done to ensure business users comply in this area. Again, regulations are required to flesh out the details of this provision in the Act and DACS will be following this process closely.