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Collecting Society Act

New Collecting Society Act (VerwGesG 2016)

The EU Directive on the collective management of copyright and related rights and the granting of multi-territorial licenses for rights in musical works for online use in the internal market was implemented by the Austrian legislator.

The resulting need for adaptation required a comprehensive revision and reorganization of the applicable standards in a separate recodification (VerwGesG 2016).

The Federal Ministry of Justice (BMJ) sent a draft of the new law for review on February 9, 2016 and set a deadline for comments until March 2, 2016.

VdFS submitted comments on the BMJ's draft law within the deadline, which can be found here.

Further comments can be found here.

The new Collecting Societies Act 2016 (VerwGesG 2016) see was passed in the National Council on April 28, 2016 and entered into force on June 1, 2016.

An amendment was also tabled in Parliament that would require collecting societies to disclose the "median income" of the rightholders in the transparency report in the future. The provision on the obligation to conclude joint overall agreements (Section 47 (2) VerwGesG 2016) was amended insofar as these must be negotiated jointly in the future at the request of the user organization (e.g., WKO), but may still be concluded separately. Otherwise, the legislator did not make any further changes to the content of the government bill.

The implementation of the requirements of the EU Directive in the new law is intended to improve the transparency of collecting societies and to facilitate the multi-territorial and cross-repertoire allocation of copyright in musical works for online distribution in the EU.

The VerwGesG 2016 includes new provisions on the operating license (while preserving previous principles), membership and corporate constitution, a concretization of rights and obligations vis-à-vis rights holders, beneficiaries and users, as well as the expansion of transparency and reporting obligations. Furthermore, new special provisions for collecting societies that grant multi-territorial licenses for online rights to musical works, the introduction of a complaint management system, the expansion of alternative dispute resolution mechanisms and an expansion of the tasks of the supervision of collecting societies as well as their internationalization and strengthening are planned.



Political Claims of VdFS

New remuneration claims

VdFS supports the proposals and concerns of the © Initiative Urhebervertragsrecht on new claims for adequate remuneration (statutory remuneration claims). In particular, these proposals are intended to result in an improvement in the remuneration of online uses of works and performances - both on download and streaming services (Spotify, Apple Music, Amazon Prime, Deezer, iTunes, Flimmit, Maxdome, etc.) and the major online platforms (YouTube, Facebook, Instagram, etc.) - for authors and performers.

In the view of the initiative, this legislative text also represents a balanced proposal that takes into account the justified interests of the exploiters and users (film producers, sound carrier manufacturers, broadcasters, streaming and download services, small and large online platforms, cable network operators, libraries, etc.) accordingly.

In this context, it is also important to consider the direct participation of authors and performing artists at the "upper end" of the exploitation chain in the uses and thus to relieve the primary copyright contract law and the good relationship between the creators and their direct contractual partners, the producers, which is important for the entire creative scene and who, as owners of derived and own rights, should also retain the decision-making and control authority.


Here is a summary of the key points:

Proposed wording film copyright

Among other things, the 2015 amendment to the Copyright Act also brought about the long-awaited amendment to film copyright law. However, in the view of VdFS, this amendment was disappointing and incomplete. Only the "cessio legis", which is contrary to EU law, was replaced by a rebuttable presumption rule. All of VdFS's more far-reaching proposals for a modern and balanced film copyright law were unfortunately not taken into account. For many years, filmmakers have been demanding equal treatment with other authors and performing artists in the UrhG.
The concrete proposals of VdFS are as follows:

1. Exception of the main director from the presumption rule (i.e. equal status with the screenwriter and composer of the film music).

2. Appropriate participation of filmmakers in the producers' revenues from types of use not yet known, exploitation rights granted in the future and periods of an extension of the protection period.

3. Appropriate remuneration of filmmakers for the communication of cinematographic works to the public, the retransmission of broadcasts and the rental of works by the respective users.

4. Indispensability and non-assignability of the aforementioned claims (except to VdFS).

5. Elimination of the "cessio legis" that continues to apply to film actors and its replacement by a presumption of conformity ( as with film authors).

6. Legal distribution regulation: all rights holders involved in the film work - filmmakers (copyright), actors (ancillary copyright) and producers (ancillary copyright) - are to share equally in the remuneration claims.

7. All other regulations of the UrhG that can only be explained historically and that continue to discriminate against filmmakers will be deleted without replacement.

The formulation proposal of VdFS for a fair and modern film copyright can be found here.

Copyright Contract Law

VdFS supports the proposals and concerns of the © Initiative Urhebervertragsrecht.

These proposals and concerns serve to strengthen the typically weaker negotiating position of creators vis-à-vis their contractual partners (publishers, labels, film producers, broadcasters, other exploiters) and are therefore of particular relevance to all writers, translators, composers, performing musicians, filmmakers, actors, visual artists and many other authors and performers in Austria.


From the point of view of the initiative, the text of the law represents a balanced proposal that also takes into account the justified interests of the user side.

Here is a summary of the key points:


Find more information here: Initiative Urhebervertragsrecht



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National Copyright Law

Copyright Amendment 2015: A fast-track bill

In Austria, the copyright amendment was rushed through before the summer break of the National Council. Already in the run-up, the draft was dismissed as a compromise paper that falls far short of what is necessary. From the point of view of filmmakers, however, this amendment still fails to reform film copyright law.

Section 38 UrhG was amended. Previously, the law stipulated that the exploitation rights to commercially produced film works automatically belonged to the film producers. This so-called cessio legis was declared unlawful by the European Court of Justice in its "Luksan" decision at the beginning of 2012. The Austrian legislator has now implemented this decision in the amendment and, as in Germany, replaced the cessio legis with a rebuttable presumption rule. It is now "only" rebuttably presumed that the film authors have granted all exploitation rights to the film producers. It is surprising in this context that the cessio legis for actors and actresses still exists. Following the German model, the breaking of the priority principle was also anchored in Section 38 UrhG, according to which the transfer of rights to the producers is possible even if the rights have already been granted to a third party (here mainly a collecting society). The legislator did not change the regulation of the statutory remuneration claims in Section 38 UrhG; half of these are still assigned to the film producers, although they have their own remuneration claims.

Furthermore, the hard disk levy was adopted in Section 42b UrhG. Previously, the so-called blank media levy was provided for in Austria. This has now been replaced by a levy on "storage media of any kind". This also includes today's common media such as USB sticks, memory cards and hard drives.

What is unpleasant from the point of view of collecting societies and artists is the double cap on remuneration, which is hidden in the back rows of the paragraphs. According to Article 116 (11), the amount of the private copying levy should not exceed 29 million per year. Considering that the reprography levy alone accounts for 9-10 million per year, after deduction of the repayments there will probably only be an amount of 12-13 million left. By way of comparison, the media subject to remuneration at the time (CD-R, DVD-R, camera cassettes, hard disks in Mp3 players, etc.) generated 17.6 million in 2005.

The regulation of private copying (Section 42 UrhG) has also been changed by the amendment. As of October 2015, it is illegal to make a copy of an original that has obviously been illegally produced or made publicly accessible. Thus, this grey area - which is of particular importance in the case of downloads from various internet file sharing networks - has now been regulated.

The concerns of education and science were addressed in Section 37a and Section 42g UrhG. Section 37a UrhG regulates authors' secondary exploitation rights for commercial contributions. Thus, if the standardised conditions are met, authors can now make their contributions publicly accessible on a non-commercial basis after a period of twelve months. Section 42g UrhG contains a provision for password-protected learning platforms. According to this provision, all published works may be made available on the intranet - with the exception of works intended for teaching and educational use. With regard to digital archives, libraries, media libraries and archives were granted more freedom of action. Section 47 (7) UrhG stipulates that these institutions may make a digital copy of existing physical works and exhibit, show and lend them. In addition, the regulations concerning the distribution of copies by libraries (Section 42a UrhG) have been extended. Here, paragraph 2 stipulates that publicly accessible collections - such as libraries, archives, museums, etc. - may make copies on order for their own school use or for the own or private use of third parties for research purposes. It is already being warned that academic publishing will be severely impaired by this, as this regulation de facto releases entire collections of academic contributions for reproduction.

The amendment provides for a further innovation in connection with the right of citation in Section 42f UrhG. Whereas until now there was no separate regulation for film quotations, the legislator now provides for a general clause that covers all categories of works.

These amendments will come into force on 1 October 2015. In the following, collective bargaining for an overall agreement between collecting societies and the WKO will take place so that creators receive the remuneration they have long been entitled to for copies on hard drives, mobile phone memory and memory cards.



Copyright Amendment 2014: Implementation of European legal requirements

The 2014 Copyright Amendment deals exclusively with European law requirements. The Directive "On certain permissible forms of use of orphan works" was implemented. The aim of the directive is harmonisation in the European area to create a legal framework within which the digitisation and publication of orphan works on the internet is possible.


The Directive was implemented in Section 56e UrhG. This amendment was published in the Federal Law Gazette on 13.1.2015, but it applies retroactively from 29.10.2015. This was an attempt to more or less elegantly conceal the fact that Austria had not transposed the Directive on time.

Copyright Amendment 2013: The big hit is missing

The expectations of the copyright amendment were high. There was talk of renewing film copyright and the long demanded hard disk levy was finally to be passed. What remained was minimum content and a more than bumpy road to get there.

In the end, the government agreed on those points that were out of the question from the outset because they were European law requirements. Thus, the duration of the ancillary copyright of phonogram producers and performers whose performances are recorded on phonograms was extended from 50 to 70 years after first publication. In addition, a number of accompanying measures for performers are standardised. For example, the producers lose their rights in favour of the performers in case of lack of use during the extended term of protection.

In addition, a fund for studio musicians and deduction-free royalties for the extended term of protection will be established. Last but not least, a joint term of protection was established for the combination of composition and lyrics in songs, beginning with the death of the longest-living author involved.

The criticism of the then Minister of Justice, Beatrix Karl, that this was merely the implementation of European legal acts, was rejected by her with the argument that the adaptation of copyright law to the digital age was being planned, but was not possible at the moment due to the strongly diverging interests of the various stakeholders. Implementation would therefore only be realistic in the next legislative period.



European Copyright Law

Directive on collective management of copyright and related rights

By April 2016, the Austrian legislator has to implement the European Directive "on collective management of copyright and related rights". This directive deals primarily with two issues: On the one hand, it is to make it possible for new music services on the internet to acquire online rights as far as possible throughout Europe. Secondly, it contains stricter rules for collecting societies in order to give authors more freedom in granting their rights. The aim here is above all to harmonise the different legal regulations of the member states with regard to collecting societies.

The new regulations for collecting societies aim above all at increased transparency, stronger supervision and stronger co-determination rights for authors. Thus, the members of collecting societies are to be granted more control. One approach is that the distribution rules should be determined in the general meeting of members. The European directive wants to give authors more room for manoeuvre in relation to collecting societies in order to strengthen competition in this area. There has already been criticism in the media in several places that the Commission misunderstands the work of the collecting societies. The directive attempts to strengthen the interests of the rights holders by giving them the possibility to transfer their rights package to a collecting society as efficiently as possible in order to withdraw it again if necessary.

What remains unconsidered here is the power of the collective. Precisely because collecting societies exercise a multitude of rights, there is a massive strengthening of their negotiating position. This negotiating position would not be available to the individual.

In the area of the music industry, the Commission hopes that the directive will help to harmonise music services on the web. Currently, for example, anyone who operates a website that can be accessed worldwide and uses protected music on it has to negotiate from state to state in order to be granted the respective national licences. Although the directive cannot introduce an "EU licence", it relies on increased competition to create multi-territorial licences. The new regulation provides that authors can continue to license their rights themselves or grant them to another collecting society if the collecting society does not offer multi-territorial licences for online music rights. In this way, the competition thus forced should lead to societies joining forces across borders in order to jointly put together bundles of rights.

It is not yet known how the Austrian legislator will transpose the provisions of the Directive into national law. It therefore remains to be seen.



Directive on certain permitted uses of orphan works 

In October 2012, an EU directive on the online use of orphan works was adopted. The aim of the directive is harmonisation in the European area in order to create a legal framework within which the digitisation and publication on the internet of orphan works is possible. An orphan work is a work protected by copyright whose right holder is unknown or cannot be located. The consequence of this is that these works can hardly be used with legal certainty. The Directive addresses precisely this problem.

According to the Directive, orphan works may now be used by certain public institutions - including, above all, publicly accessible libraries, museums and archives. This use provision includes permission to make the works publicly accessible, to digitise and reproduce them for this purpose, and to index, catalogue, digitise, preserve and restore them.

The category of works concerned includes cinematographic works, audiovisual works and works in book or other written form. However, before an orphan work can be published or digitised, a thorough search must be made for the rights holder. If the rightholder cannot be found, the work is given permanent orphan status, which applies both to the country of publication and to all other European countries. If the right holder is found at a later date, the orphan status can be lifted for the future. For this period of use, he or she can demand an appropriate remuneration.

In Austria, this directive was implemented in the 2014 Copyright Amendment.





International Copyright Law

Treaty of Beijing

After years of effort, the Diplomatic Conference of the World Intellectual Property Organisation was able to adopt the Beijing Treaty on the Protection of Audiovisual Performances on 24 June 2012. The content of the treaty is the international protection of the rights of performing artists in their audiovisual performances. Performers are defined as "actors, singers, musicians, dancers and other persons who act, sing, perform, interpret or otherwise give performances in literary or artistic works or folklore performances" (Article 2a).

Of particular interest in this context is Article 12 of the treaty, according to which, in the case of a transfer of rights from the artists to the producers, rules are to be adopted according to which this transfer must be accompanied by remuneration. Furthermore, the treaty grants the performers in audiovisual performances the right to exclusively determine the use of the work - above all reproduction, distribution, lending - for 50 years.

These exclusive rights also relate to the right of reproduction in broadcasting and to "other forms of communication addressed to the public". Another central point is the protection of moral rights. This means the right to be named and the possibility to take action against it if the reputation of the artist is damaged, in the case of changes or distortions of the performance.

The rights granted to artists by the Beijing Agreement must now be implemented in national regulations. The prerequisite for enforcement is that as many WIPO member states as possible ratify this treaty.





Treaty of Marrakesh

In June 2012, WIPO agreed on a global copyright exception for blind people in the Marrakesh Treaty. The treaty aims to eliminate the worldwide shortage of books for blind, visually impaired and reading-impaired people.

To date, a dwindling proportion of all books have been adapted for blind, visually impaired and reading-impaired people, especially in formats such as audio books and books in Braille. The logical consequence of this is social exclusion in the field of education. The treaty addresses precisely this problem. An exception is to be standardised in the respective copyright laws of the signatory states, according to which the various special formats can be created without the consent of the rights holders. Furthermore, "authorised bodies" are to be created from which the respective special formats can be obtained by rightholders.

This contract also promotes and enables international distribution. For example, while 200,000 books were translated into Braille in America, only a fraction could be used in the UK due to copyright differences. The uniform exception in the various copyright systems now makes international exchange possible.

Austria has included the implementation of this treaty in the recently adopted copyright amendment. The newly added § 42d UrhG standardises exactly the exception that the Marrakesh Treaty wants to integrate internationally into the various copyright laws.