WRITTEN QUESTION E-0266/03

by Joachim Wuermeling (PPE-DE) to the Commission

(6 February 2003)

Subject: Monopoly held by copyright collecting societies

In the Member States of the European Union there are national collecting societies, which administer copyright and related rights, including exploitation rights, in trust. The collecting societies monitor public events and collect the agreed royalties. In order to administer copyright law abroad, reciprocal contracts have been concluded by the collecting societies in each individual Member State. According to these contracts, each national collecting society also acts for foreign collecting societies in its home country, representing foreign copyright owners and collecting the royalties, which are then considered in both countries' calculations. These territorially exclusive reciprocal contracts mean that, in each Member State, performance rights can be bought only through an intermediary. There is no competition, which leads to a steady rise in fees.

Using PHARE and TACIS funds, the European Commission has launched a programme in the accession countries for copyright protection, one of the aims of which is to create a functioning system for this purpose.

1. What is the Commission's position on the monopoly held by the collecting societies?

2. In constructing a legal framework for copyright protection in the accession countries, is the Commission encouraging the emergence of such monopolies?

Answer given by Mr Bolkestein on behalf of the Commission

(12 March 2003)

The monopolies held by collecting societies have, on a number of previous occasions, been subject to Commission scrutiny. Both the Commission and the Court of Justice have considered that, in specific cases(1), some of the collecting societies' practices can restrict competition. At the same time, it is generally acknowledged that the societies in question play an important role in administering copyright and related rights, particularly because they are able to offer their members and users a one-stop shop, which considerably facilitates access to works and other protected objects. As regards the reciprocal agreements, these make it possible for the societies to offer a world-wide catalogue to users, provided that they are compatible with competition law(2).

Furthermore, in view of the very strong links between competition aspects and the rules of the internal market, the Commission would inform the Honourable Member that it has been studying the issue of the management of intellectual property rights, and collective management in particular, for several years. It considers that collective management must be fully effective within the internal market and is therefore drafting a communication on the management of intellectual property rights. The communication will take stock of the situation in the sector, the questions raised and possible answers.

As for the second point raised by the Honourable Member, the Commission would point out that Article 295 of the EC Treaty stipulates that this Treaty shall in no way prejudice the rules in Member States governing the system of property ownership. Whilst the existence of intellectual property rights cannot be called into question, it is nonetheless the Commission's role to ensure that the exercise and administration of these rights do not conflict with the rules of competition and of the internal market. Moreover, the Commission would like to make it clear that, insofar as collecting societies are needed for the effective exercise of certain intellectual property rights and that there are very often no other legal or de facto solutions for issuing operating licences, it considers the existence of such entities to be useful within the Community as well as in the accession countries, provided that the activities of these entities are well regulated by certain specific legal rules and are subject to supervision by the competent authorities, particularly those which have been set up for this purpose and competition authorities.

(1) GEMA, Commission Decision of 2 June 1971 OJ L134, 10.6.1971; Tournier, Case 395/87, judgment of the Court of Justice of 13 July 1989; Lucazeau, Cases 110/88, 241/88, 242/88, judgment of the Court of Justice of 13 July 1989.

(2) See, for example, the Commission Decision of 8 October 2002 in Case 38 014 IFPI Simulcasting, which can be consulted on: http://europa.eu.int/comm/competition/antitrust/cases/decisions/38014/en.pdf.