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 EPC Members' Newsletter: May 2002

 

EPC MEMBERS’ MAY NEWSLETTER 110

Cookies
Future of Europe Convention
WHAT’S NEW
Electronic Commerce
1.1 VAT on ecommerce
1.2 DG Enterprise research initiatives for Ebusiness
1.3 B2C Trustmarks
Internet Regulation
2.1 Data protection Copyright
3.1 Seminar on the defence of EU intellectual property
3.2 WIPO Standing Committee on Copyrights
3.3 German copyright law delay
3.4 CEN meeting on digital rights management Advertising
4.1 EASA workshop
4.2 Commission acts against French advertising ban
4.3 Proposal to ban alcohol advertising in Spain Audiovisual & General Media Policy
5.1 Culture Council results
5.2 Danish Presidency objectives
5.3 MEDIA programme awards
5.4 BBC digital services

5.5 Book Price Fixing
5.6 Hearing on the media and terrorism
5.7 Polish press self-regulation
5.8 STOA cultural diversity study
5.9 The environment General
6.1 Rome II and the Hague Convention
6.2 WAN Conference in Bruges
6.3 Sales Promotion
6.4 Speech on competition law
UPCOMING EVENTS


DATES FOR YOUR DIARY
6-7th June - European Business Summit. European Services Forum, Brussels.
16-18th June - EU Copyright Conference, Santiago, Spain
12th June – ‘The UK Draft Communications Bill - a signal for the TV-directive in the digital era?’ European Parliament Audiovisual Intergroup, Strasbourg. For more info contact the office of Ruth Hieronymi MEP at rhieronymi@europarl.eu.int
16-18 June – Biannual Copyright conference, Santiago, Spain
28th June – EPC meeting to discuss the unfair competition project, London or Brussels
22-23rd July - Audiovisual Expert Seminar. Danish Presidency, Copenhagen. Seminar on content production for the new media.


KEY ISSUES OF THE MONTH

Cookies

After a long campaign by EPC to protect the cookies technology that most websites use to power personalised services, heavyweight regulation has been avoided.

The European Parliament has completed its second reading of the controversial ‘Data Protection in Electronic Communications’ Directive which deals with cookies and politically sensitive data retention, plus commercial email and SMS marketing.

Prior to the vote, the Spanish Presidency of the EU proposed various last minute compromise amendments in order to avoid a potentially protracted third reading of the Directive. The amendments on cookies, which sought to remove the contentious requirement to provide information "in advance" of cookies being used, met with widespread support across the political groups.

The EPC is delighted that the European Parliament gathered sufficient votes to support the compromise amendments, which are a victory for common sense. Although not perfect, the new wording will allow the online and interactive industries to develop practical solutions to deliver consumer protection as well as fast and efficient internet usage.

This is excellent news for the EPC, especially when compared to what was originally proposed by MEPs at the first reading and during many of the subsequent discussions in the Parliament and with the European Commission.

MEPs originally wanted internet companies and third party advertisers to seek the explicit, prior consent from users before using cookies. Member states were subsequently persuaded by the EPC, supported by other industry bodies, that this was disproportionate and impractical. MEPs accepted our calls for an opt-out approach but then decided the opt-out must still be offered “in advance” of cookies being used. This was virtually identical in effect to prior consent, so the EPC again campaigned to remove the “in advance” wording. Now, after our successful campaign, the consolidated text of the Directive will not contain the “in-advance” wording.

We expect that the Council will accept the changes to the directive when they meet on June 18th. This means that there will be no need for conciliation. The timetable suggests that the Directive will be published in July, and should take effect by October 2003. Under EU legislative rules, Member States have a certain amount of flexibility about how they implement a Directive, providing they can prove that the effect is the same as in other Member States. EPC will continue to monitor the implementation methods individual States use for this Directive.

A copy of the consolidated text of the proposal is available on request.


‘Future of Europe’ Convention
In its first paper to the Convention on the Future of Europe, the Commission has called for more effective EU structures that can respond better to citizens' demands and expectations. In its opinion, the role of the Union should be substantially strengthened in three major areas:
-the introduction of the Euro requires better mechanisms to steer the European economy;
-there has to be a genuine European capacity to enhance security and freedom of citizens;
-the Union must have a forceful foreign and security policy in order to make a difference in the world.

In order to achieve this, the Commission wants stronger economic policy coordination. It proposes common border controls with a common immigration and asylum policy. It contends that decision-making should be simplified within a single institutional framework, putting the European Union firmly on the road towards a Constitution with a Charter of fundamental rights.


WHAT’S NEW


Electronic Commerce
1.1 VAT on ecommerce
The Council has voted to modify the rules for applying VAT to certain services supplied by electronic means. The new Directive and Regulation will also cover subscription-based and pay-per-view radio and television broadcasting.

The rules will ensure that when these services are supplied for consumption within the European Union, they will be subject to EU VAT, and that when they are supplied for consumption outside the EU, they will be exempt from VAT.

The new rules will apply to the supply, over electronic networks, of software and computer services generally. They will also apply to the electronic provision of information and cultural, artistic, sporting, scientific, educational, entertainment or similar services and to broadcasting services.

The changes will require suppliers of digital products from outside the EU to charge VAT on sales to private consumers for the first time. Non-EU suppliers will be obliged to register with a VAT authority in a Member State of their choice and to levy VAT at the rate applicable in the Member State where the customer is resident. The country of registration will re-allocate the VAT revenue to the country of the customer. This system will be applied for three years following implementation of the proposal and may then be extended or replaced.

The Regulation enters into force on the 7th day following publication but no exchange of information will take place before 1st July 2003. The Directive enters into force immediately.

1.2 DG Enterprise research initiatives for Ebusiness
DG Enterprise has launched a scheme designed to help businesses and consumers using ecommerce. E-Business Watch is part of a series of studies to be undertaken by Eurostat, the statistics office of the Commission.

The objective of the e-Business Watch is to improve the knowledge of the impact of e-business on enterprises and industrial sectors. Regular reports on the take-up of e-business in the EU and in different economic sectors will be published. These reports will include surveys of take-up covering 15 different sectors, including publishing and printing, in all Member States. For more information on the E-Business Watch scheme please follow the link below:
http://www.ebusiness-watch.org

1.3 B2C Trustmarks
Almost 2,000 businesses in seven European Union countries have been awarded trustmarks in the pilot phase of the "Webtrader" program to promote fair business-to-consumer (B2C) trade over the internet.

The scheme, which is co-funded by DG Enterprise, aims to build consumer confidence in e-commerce and help enterprises make the most of e-commerce tools. It offers online certification for business and a "Webtrader" logo for companies that comply with a set code of conduct.

The scheme was launched at the start of 2000 by consumer associations in Belgium, France, Italy, the Netherlands, the UK, Spain and Portugal. It is being extended to other European countries.

Internet Regulation

2.1 Data protection
The European Commission is undertaking a full review of the application and effectiveness of the 1995 General Data Protection Directive. A questionnaire addressed to Member States has been sent out already and the Commission will be analyzing the results over the next few months. A similar questionnaire has also been addressed to the national data protection supervisory authorities.

On 17th June an online-consultation will be launched with a questionnaire for industry, data subjects and data controllers. The consultation exercise will culminate in a Data Protection Conference to be held in Brussels on 1-2 October. Together with the outcome of a study by the European Commission on the application of the Directive, the conference will contribute to the preparation of the final report on the implementation of the Directive. The Commission aims to finalise this report by the end of this year.

Copyright
3.1 Seminar on the defence of EU intellectual property
The Spanish Presidency hosted an intellectual property seminar for Member State Ministers this month in Madrid. The seminar produced 5 proposals for action:
-action to raise public awareness of cybercrime;
-the creation of a uniform legal framework in the European Union to tackle violation of intellectual property rights;
-the establishment of the European Observatory on Infringement of Intellectual Rights;
-the stepping-up of judicial and police cooperation in Europe against infringements;
-more intensive training programmes for members of the judiciary and the police responsible for the protection of intellectual rights.

Further details of the results of the seminar can be obtained on request

3.2 WIPO Standing Committee on Copyrights
Delegates at the meeting discussed the proposal by Paraguay on Protection of Broadcasting Rights and the study on the protection of unoriginal databases. The main point for discussion was the WIPO technical background paper on the protection of broadcasting organisations. The paper asks 4 main questions:
-what are broadcasting organisations;
-who should be protected;
-why should they be protected;
-how should they be protected.

The main issue for debate on this subject was the description given in the existing legal instrument in this area. The Rome Convention 1964 defines broadcasting as “transmission by wireless means for public reception of sounds, or of image and sound”. This definition only covers air transmission and satellite but not cable broadcasting. It is questionable whether the definition still remains sufficient in light of present technological realities.

A copy of the technical paper is available on request.

3.3 German copyright law delay
The German Government intends to postpone the implementation of the EC Directive on the harmonisation of certain aspects of copyright and related rights in information society until after the German general election in September. The amendment of German Copyright Law does not yet address important issues such as the prohibition of the circumvention of technical protection of works or limitations on private copying.
3.4 CEN meeting on digital rights management
CEN, the European standardisation bureau, met this month to agree an outline for its paper on digital rights management. The committee has found it difficult to agree on an outline and has set up a group to finalise this. When the outline has been decided upon, contributions will be accepted from interested parties. These contributions will be used to form part of the final report which will not contain recommendations but a series of divergent opinions from stakeholders.

Advertising
4.1 EASA workshop
EASA held a workshop which EPC attended on 30-31st May in Brussels entitled “Self-regulatory challenges from New Media and New Forms of Advertising.” Presentations on new forms of advertising and self-regulation were given, along with the results of case studies in different EU Member States. Working group sessions in the afternoon focused on issues of data protection, children and copyright. Whether existing arrangements for self-regulation are suitable for new media was also examined, along with what changes could be made to make self-regulation more efficient in this area.
4.2 Commission acts against French advertising ban
The European Commission has taken action against a French law banning retail groups from television advertising. The Commission wrote to the government this month to register its concern that the law imposes illegal restrictions on the activities of foreign advertising agencies. The French Government must respond within two months to the letter or face being taken to the European Court of Justice by the Commission.

The French government contends that the law is needed to protect press diversity as part of the ‘cultural exception’ agreement but Commission officials doubt that it complies with EU single market rules. France must now prove that the law is the best measure to protect the diversity of the press and small businesses and that there are no other, less restrictive measures, to achieve those objectives.
4.3 Proposal to ban alcohol advertising in Spain
The Spanish government has produced a draft bill to ban advertising on TV and radio of any alcoholic beverages with an alcohol content of more than 20°. The bill will also limit the promotion of beer, wine and cava on TV to between 10 p.m. and 8 a.m. and the number of adverts promoting alcohol to 15% of a TV channel's total advertising slot. Alcoholic brands would also be prohibited from sponsorship of TV programmes.

For print media, the bill proposes no advertising of alcohol on the covers, inside or back pages of publications. The promotion of alcoholic beverages would be limited to no more than 25% of a newspaper or magazine's total advertising space.

The bill also suggests an outright ban of any alcohol advertising in cinemas and the advertising of drinks with a content of more than 20° alcohol in outdoor media.

EPC will monitor developments in this area closely.


Audiovisual & General Media Policy
5.1 Culture Council results
Ministers at the Culture Council this month have decided not to undertake an immediate review of the ‘Television Without Frontiers’ Directive. It was decided to set up a work programme to develop the proposal at a later date. Commissioner Reding stated that a work programme would be useful in the assessment of the current Directive and could help to establish future measures which would strengthen the audiovisual sector.

The Council also adopted resolutions on European cultural co-operation and the maintaining of digital content in the extension of the Culture 2000 Programme until 2005.

A new cultural co-operation work plan is to be developed. It will focus on themes such as added European value and access to and visibility of cultural action within the European Community. It will also develop new strategies which will take into account cultural aspects within the framework of other Treaty provisions.

The Resolution to safeguard digital content will stimulate cultural conservation policies by supporting conservation agencies and encouraging cooperation between Member States in the sharing of good practice and conservation methods.

More information on the Culture Council is available from EPC on request.

5.2 Danish Presidency objectives
At the recent Culture Council the Danish Presidency announced its priorities for the second half of the year. It highlighted two main areas of activity in cultural policy:

Art 151
The Danes will be working on Art 151 and will examine the Culture 2000 Committee guidelines and the indicative list to give added value to their work. This may lead to a resolution. For more detail see http://www.europa.eu.int/comm/culture/eac/decision_en.pdf

Video Games and Interactive phones
The Presidency wishes to prepare a paper on audiovisual policy. Its main theme will be framework conditions for content production.

A mid-term evaluation of its work in September, which will probably lead to Council Resolutions on the subjects mentioned above, will also be presented. The Danish Presidency may also produce a Council Resolution as the result of Culture Council work on Legal Aspects of the Cinema sector.

The Danish Government has also published its objectives for eEurope during its 6-month Presidency period. Its main objectives are improving online security and building consumer trust in the internet. Other priorities will be: e-government, e-content, e-learning, e-health and accessibility to broadband.

5.3 MEDIA programme awards
Viviane Reding, European Commissioner for culture and audiovisual media, presented the European Union's MEDIA Prize in Cannes at the closing ceremony of Directors' Fortnight this month. This year the prize went to "No Man's Land" by Danis Tanovic. The film has recently received several awards, notably an Oscar. It was distributed in Europe with the support of the MEDIA programme.

Mme Reding was also able to announce the inclusion of 8 candidate countries in the MEDIA programme. Beginning either this year or next cinema professionals in Bulgaria, Cyprus, the Czech Republic, Estonia, Lithuania, Latvia, Poland and Slovakia will be able to benefit from the provisions of the MEDIA programme.

Last year, the programme provided support for 280 campaigns for the distribution of 61 European films outside their country of origin, in the form of aid amounting to approximately EUR 12 million. This included aid for successful films like “Amelie” and “Italian for Beginners”. Aid was also given to ‘joint ventures’ between Member States. MEDIA funded 29 television projects last year and supported 70 film festivals which promoted European films. The programme has also given considerable support to vocational training in the industry.

5.4 BBC digital services
The European Commission has decided that the funding of the BBC's nine new digital television and radio channels through the UK television licence fee does not violate the rules on state aid. This is because the new channels will be subject to public service obligations and state financing is not disproportionate to the net costs of running the services.

5.5 Book Price Fixing
The European Parliament adopted an own-initiative report on book price fixing this month. On adopting the report, the Parliament asked the Commission to submit a legislative proposal on this issue by the end of 2002.

More information on this report is available from EPC.

5.6 Hearing on the media and terrorism
The Council of Europe recently held a hearing on media and terrorism. Guest speakers unanimously considered that no matter how serious the acts of terrorism perpetrated on and since 11 September 2001, there is no need to impose new restrictions on freedom of expression and information in order to combat terrorism.

Speakers expressed concern at the number of governments who are considering anti-terrorism laws which could restrict freedom of information.

Speakers also recognised that the media has a responsibility to inform the public in a way which does not reinforce insecurities about terrorist attacks. The view was put forward that the media has a duty to inform and that information which explains terrorism and its possible causes should be conveyed clearly to the public. Speakers felt that the best way to do this was self-regulation of the media with guidelines which cover training and the encouragement of media diversity.

The Council of Europe was called upon to monitor its Member State governments and ensure that stricter anti-terrorism measures do not infringe upon human rights. It was also called upon to support any self-regulation and training measures taken.

5.7 Polish press self-regulation
The Polish Journalists Association has proposed legislation that would require journalists to join a new professional organization and mandate that they all have journalism degrees and an undergraduate education. The proposal advocates a guild system, like that of doctors or lawyers, which would mediate between journalists and their employers. It splits journalists into two groups -- professionals and interns -- with professionals required to join the guild. The guild would decide who can practise journalism and who cannot. For some, the fact that a guild can determine who is deemed a journalist is being viewed as a threat to the freedom of the press but the Association states that all are in favour of self-regulation it is merely the detail of what that implies which gives them cause for concern.

5.8 STOA cultural diversity study
The research arm of the European Parliament presented its report on cultural diversity this month. The recommendations of the report are that the Culture Committee should radically broaden its remit as culture is to be found in all aspects of society- research, structural funds, agriculture etc. Professor Marsh, the academic presenting the report, stated that the EU should finance Arabic, Hebrew and Hindu films as well as European cinema. He also argued that there should also be a review of copyright since, in his opinion, copyright does not support creative people but companies who turn culture into product. The house appeared bemused by the rather radical suggestions given by Professor Marsh. A second update on the cultural heritage report will be available soon.

5.9 The environment
Representatives of European publishers associations, ink manufacturers, printers and paper manufacturers met in Brussels this month to discuss the possibility of a joint position paper on the environment. A member of the FAEP environmental committee gave a presentation on the success of a similar cooperation which has already taken place in Germany. As well as examining the possibility of a position paper, representatives discussed legislative proposals which could affect the industry in the near future. It was decided that the whole group would meet again in September. Publishers will meet in June to discuss the matter further.

General
6.1 Rome II and the Hague Convention
The Commission has released a consultation document on a proposal for a Regulation on the ‘Law Applicable to Non-Contractual Obligations’ (so called Rome II Regulation) this month. The Commission has stressed that this consultation document is very much a working paper, designed to launch a public debate. Account of reactions to it will be taken when preparing a proposal for legislation.

The Rome I Regulation defines which law is applicable to contractual obligations. This was a convention of 1980 and has been enforced in the Member States since 1992.

Rome II is designed to fill in the gaps with non-contractual agreements. So far rules are not set out anywhere. At the moment, judges can exercise their discretion and it is often the law of the country where the case is heard that applies. This new Regulation is to create a common standard and set of rules for judges to apply in such cases.

The consultation document is available online at
http://www.europa.eu.int/comm/justice_home/unit/civil/consultation/index_en.htm
The Commission has set a deadline for comments from interested parties of 15 September 2002.

Meanwhile, at a meeting in April on the Hague Convention (the global version of Rome II) it was decided to try to continue to work on a world-wide convention. An Information Working Group will be set up to help prepare a new draft. The group will be composed of national experts. It will focus on the core issues and decide if the Convention should be limited or not. There will be another meeting to discuss the new draft in the first part of 2003.

6.2 WAN Conference in Bruges
The World Association of Newspapers held its annual conference in Bruges last week. Topics discussed included new strategies for profit growth and the major challenges facing the industry in the next five years. Up-to-date statistics on the publishing industry commissioned by WAN were presented for the first time. The Innovation International Media Consulting group presented their 2002 Global Report on Innovation in Newspapers.

On the second day the conference moved to the European Parliament in Brussels where delegates listened to two panel discussions on ‘Media in the Information Society’ and ‘Media Concentration’. Commissioner Liikanen emphasized his support for the publishing industry and his wish to follow up the dialogue that began with the Publishers Forum on 5th March.

During a debate about media concentration in Europe, Roy Perry MEP expressed his concern and said that although he believes cross-media ownership should be allowed, there should be limits to the total percentage of the media market held in order to preserve pluralism. Mr Gavin O’Reilly of Independent News and Media said all discussions on limiting media concentration focus on media ownership, though there is little if any evidence that any correlation exists between consolidation and "concentration of opinion," or a lack of diversity. A report of the Brussels debate is available on request. For more information on the speeches and participants see http://www.wan-press.org

6.3 Sales Promotion
The Legal Affairs Committee of the Parliament has examined the Sales Promotion Proposal again this month. Due to the 246 amendments which have been proposed, the report’s adoption in Committee will be delayed until 20th June and the plenary adoption until September. Five different types of amendments have been proposed:
-on Sales-at-a-loss
-on if the proposal should be a Directive or Regulation
-on protection of children (extending age limit to 16)
-on the principle of mutual recognition of areas not harmonised by the directive
-on the information requirements in the annex.

The main debate centred on Sales Below Cost and whether the legislative instrument should be a Directive or a Regulation. Very little mention was made of the issues of relevance to EPC.

The Council of Ministers has also discussed the proposal. An orientation debate on the proposed Sales Promotions Regulation took place at the Internal Market/Consumer Council on 21st May. Nine Member States would prefer the measure in the form of a Directive rather than a Regulation as it would give them more flexibility upon implementation into national law. Belgium and Ireland suggested shelving the proposal until the EU Consumer Protection dossier has evolved further. Only the United Kingdom and the Netherlands threw their weight behind the draft Regulation in its current form. The Council has agreed that it will continue discussing the Commission proposal during the Danish Presidency, which begins in July.

EPC has written to MEPs asking them to take into account issues other than sales below cost such as stating the actual commercial value of a free gift or the odds of winning a competition.

6.4 Speech on competition law
In a speech to the English law society, Mr Mendes Pereira of DG Competition presented a number of cases the European Commission has dealt with in the past two years which illustrate the way EU competition law has accommodated the latest developments in the media industry.

In his speech Mr Mendes Pereira defined the way in which the Commission analyses media concentration issues before highlighting individual cases and the way in which they had been dealt with by DG Competition.

A copy of the speech is available from EPC on request.

UPCOMING EVENTS
16-18th June - European Copyright Revisited, Santiago de Compostela, Spain
19 – 20th June - Accumulation and enforcement of Intellectual Property Rights, Maastricht, Holland
This seminar will be focused on the most recent legal and policy considerations shaping the global environment of innovation and creativity. Speakers from the bar and academia will cover a number of issues related to the TRIPS regime and the enforcement of patent, trade mark, design and copyrights, as well as the accumulation of Intellectual and Industrial Property Rights and their interface with contract and technical protection mechanisms. Furthermore problems of access and the role of competition law in software, database and diagnostic tool markets will feature strongly on the agenda. Convenor: A. Kamperman Sanders, (Universiteit Maastricht). Lecturers: Hugh Hansen (Fordham University); John Adams (University of Sheffield); Graeme Dinwoodie (Chicago-Kent College of Law, Illinois Institute of Technology); C. Heath (Max Planck Institute Munich); M. Blakeney, (University of London) and others. Detailed information about this seminar available at http://www.amsu.edu/courses/law/law42002.htm



 
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