IP news summer round up: Europe

The European Commission has sent a Statement of Objections to Sky UK and six US film studios (Disney, NBCUniversal, Paramount Pictures, Sony, Twentieth Century Fox and Warner Bros) regarding its antitrust investigation into their content licensing agreements. This is part of the Commission’s investigation into the provision of cross-border pay-TV services in the EU.

The Commission is concerned about the clauses in their agreements that require Sky UK to block access to films on its UK and Irish pay-TV services (geo-blocking) to consumers in other EU member states – that is, outside the licensed territories (UK and Ireland), restrict Sky UK’s ability to accept unsolicited requests from such consumers (passive sales); and require the studios to restrict other broadcasters from making their pay-TV services available in the licensed territories.

“[T]hese clauses grant ‘absolute territorial exclusivity’ to Sky UK and/or other broadcasters. They eliminate cross-border competition between pay-TV broadcasters and partition the internal market along national borders. The Commission's preliminary conclusion is that, in the absence of convincing justification, the clauses would constitute a serious violation of EU rules that prohibit anticompetitive agreements,” the Commission said in its press release.

A Statement of Objections is a preliminary position which gives the addressees an opportunity to defend themselves before the Commission makes its final decision. The Commission must have been emboldened to look into this sector following the CJEU’s decision in Karen Murphy v Media Protection Services.

This news comes at a time when rights holders have already expressed concerns over the Commission’s Digital Single Market (DSM) strategy, and the European Parliament has adopted a non-binding Resolution (based on a report by Pirate Party MEP Julia Reda on EU copyright reforms) dealing with the issue of geo-blocking.

The Centre for International Intellectual Property Studies (CEIPI) reacted to the Resolution stating that a single EU copyright law is one of the most efficient ways to tackle this issue.

In 2013 the UK government passed legislation to allow artistic works exploited through an industrial process to receive the full term of copyright protection (life of creator plus 70 years) instead of 25 years. The law will bring the UK into line with EU law, and applies retrospectively to effectively restore lapsed rights.

To avoid legal implications for third parties, the Government last March issued an Order which made transitional arrangements, one of which was to defer the effective date of the new law to April 6 2020 to allow third parties already dealing with copies of these works to adjust before the law comes into force. Having received a claim for judicial review over these arrangements, the government has revoked this Order. There will be fresh consultations on the transitional arrangements. (For background information see here and here).

This is yet another judicial review of the UK Government’s copyright reform - the most recent was on copyright levies.

The IP Federation has published its response to the UPC Preparatory Committee’s consultation on court fees and recoverable costs.

The association opposes any opt-out fee, but says that if such a fee is to be levied then it should be subject to a cap.

It is also worried that wealthy non-practising entities would unjustly benefit from the proposed financial support to certain users such as SMEs and recoverable costs regime.

Adaptive Spectrum and Signal Alignment (ASSIA) and BT have reached an out-of-court settlement in their long-running patent infringement disputes.

According to a press release by ASSIA, the settlement terms are that both parties will cross-license some of their patents, and dismiss all pending actions in the UK, the EPO and the US.

Last year ASSIA secured victory against BT in the English Court of Appeal in a dispute over patents relating to ADSL technology.

The EU Commission has adopted a Delegated Act setting out details of the Union Customs Code (UCC) which will apply from May 1 2016. The Act is expected to bring about a “modern and cost-effective customs system” including clearer rules, ease of data sharing and IP enforcement within the EU.

The Act will be published once it has been communicated to the European Parliament and Council, and enters into force if both institutions do not object to it.

The EU Commission discussed IP and geographical indications (GIs) with the US at the 10^th round of negotiations on the Transatlantic Trade and Investment Partnership (TTIP). The talks on IP focused around border measures, but there is still a deadlock over the protection of GIs.

The Commission has published its proposed texts on customs enforcement of IP and recognition of international agreements on IP. The EU’s objectives in the TTIP negotiations on IP and GIs can be found here.

A draft report by a special tax Committee of the EU Parliament has identified preferential tax schemes for IP (such as patent boxes) in a number of member states as “typical examples of harmful tax competition between states”.

In its fact-finding mission the Committee visited Belgium, Luxembourg, Ireland, the Netherlands and the UK. The report claims that these schemes “have the effect of reducing the tax revenue of other countries, including member states”. It calls on the EU Commission and member states to take action.

The report will be put to a vote this autumn. The EU Commission has already presented its Action Plan to reform corporate taxation in the EU.

The Minister of Economic Development, Federica Guidi, and the Minister of Economy and Finance, Pier Carlo Padoan, have signed a decree which will implement a patent box scheme in Italy.

The scheme, which was brought in by the Finance Act, will see a reduction in tax as follows: 30% in 2015, 40% in 2016 and 50% in 2017. The idea behind it is to attract IP, or exploitation thereof, and research and development to the country, and it is expected to become operational following the publication of the decree in the Italian Official Gazette. For more details see the article by Carlo Maria Paolella and Andrea Tempestini.

Last year Spain enacted legislation that included a provision mandating search engines and news aggregators to pay a licence fee to news publishers to display snippets of their content (the so-called Google tax). The controversial provision, which came into force in January this year, pushed Google to shut down its news services for Spain last December.

A recent report (in Spanish) commissioned by an association of Spanish publishers suggests that the impact of this provision has been negative in various ways. On a similar thread, TorrentFreak reports that the Spanish IP Commission is making good progress with its new enhanced powers to tackle online piracy.

IP-Watch reports that the US, supported by a number of other countries, has refused to approve WIPO’s draft programme and budget for 2016/17 unless certain issues are addressed. This was its position at the 23^rd session of the Program and Budget Committee held last month, where it repeated its concerns over the revision to the Lisbon Agreement (Geneva Act) to cover geographical indications (GIs). The US believes that the Geneva Act will have a negative impact on prior trade mark rights holders, and that its structure is financially unsustainable.

The US called for greater financial accountability, and does not want the new system to rely on funds from other WIPO-administered treaties such as the Madrid system. The WIPO Secretariat has taken note of these concerns for discussion at its next meeting in September.