The European Union (EU) Parliament on March 26, 2019, voted in favor of a new Copyright Directive (“Directive”) that will bring radical reforms to how copyrighted content posted online is governed. Then on April 15, 2019, the European Council voted to adopt the Directive into European law. Since the Directive is part of European law, individual EU members will have two years to adopt the new European law into their national law.

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Most of the amendments in the Directive are uncontroversial, merely setting out how copyright contracts are managed and licensed. However, Article 17 (formerly Article 13) of the law could have a massive impact on how materials are shared online. Under the new law, companies of online content-sharing service providers (“Service Provider”) will be liable for content that users upload, a burden that will fall heavily on some of the most popular Service Providers.

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The new law added:

“An online content-sharing service provider shall therefore obtain an authorization from the rightholders…, for instance by concluding a licensing agreement, in order to communicate to the public or make available to the public works or other subject matter.”

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It means the financial impact of potentially being held liable to movie studios, musical artists, and others for copyright infringement is going to be pretty high to imagine for a European startup or growing tech platform. For example, YouTube has already paid out more than $3 billion to copyright holders through its Content ID system. Therefore, it means that a startup service provider will have added difficulty in providing content-sharing services if they are forced to have to come to agreements with tons of rightholders.

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Article 17 also included:

“where an online content-sharing service provider obtains an authorization, for instance by concluding a licensing agreement, that authorization shall also cover acts carried out by users of the services…when they are not acting on a commercial basis or where their activity does not generate significant revenues.”

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The above language seems to indicate that even it is Service Providers rather than service users who bear the impact of the new law, but the law may have a material effect on people's favorite content-sharing websites. The owner of a website or a forum in which people can post text, images or video clips, will also be responsible for ensuring no unlicensed material appears even they don’t generate revenues. Thus, the law may have a negative effect on vibrant internet cultures, such as “memes,” “gif,” “snippet” etc., which often are the regeneration of unlicensed materials. As well as the legal status of streamers, who post videos of themselves playing video games online, may also be in question.

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Most importantly, this new law seems to be directed against these larger and popular Service Providers, as it stated:

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“Where the average number of monthly unique visitors of such service providers exceeds 5 million, calculated on the basis of the previous calendar year, they shall also demonstrate that they have made best efforts to prevent further uploads of the notified works and other subject matter for which the rightholders have provided relevant and necessary information.”

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The above language implies that the Service Providers may have to implement stricter filters and improve its quality of preventing protected works being shared illegally. “Five million” visitors is not a tough number to achieve in the world today. Thus, with stricter filters, most of these Service Providers fear that there will be a higher volume of removals and less accessible contents to its users, and it may lead to its users to abandon the use of such Service Providers.  

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In sum, with the EU introducing such a perplexing and controversial law can have substantial global consequence. Article 17 covers almost all Service Providers that help people surf for materials that are uploaded online, such as YouTube, Google, Facebook, Dailymotion, Twitter, etc. Thus, if you are an internet celebrity or your employment and income are based mainly on online videos, podcast, and live streaming, Article 17 may have a material effect on your work once the EU members implement the law within the next couple of years. As mentioned earlier, you may not include any materials or contents that are unauthorized or unlicensed by the rightholders. Therefore, even you are an internet celebrity in Taiwan, but if any of your creation consists of any unlicensed materials, most likely these Service Providers may take the initiative to remove your uploaded contents or block your live streaming as a precautionary measure. It is very likely that this new copyright law will result in a change of the way we use the online content-sharing services and the economic structure behind it.

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