New fees for use of copyright

The question whether entities using the copyright of another pay fixed royalties or minimum royalties is irrelevant; the key issue is how much of an encumbrance these fees will be for them.

Polish parliament is now considering draft amendments to the legislative Act regarding copyright and associated rights concerning the terms of settlements between entities using such rights and the collective management organisations. In its ruling of 24 January 2006, the Polish Constitutional Tribunal held art 108.3 of this Act to be contrary to the Constitution. This art 108.3 provided that a commission composed of six arbitrators and a chairperson (as the superarbitrator) designated by the minister competent for matters of culture and the national heritage approves royalty tables regarding use of works and/or artistic performances covered by collective management or refuses such approval. As this ruling was announced, I was decidedly inclined to support the position expressed in the dissenting opinion of Ewa Łętowska, the Constitutional Tribunal judge, who argued that the royalty definition mechanism instituted in art 108 of the Act is flawed and irrational in its entirety – as it were, in its very essence.

The amendments now debated by Polish parliament propose to repeal arts 108 and 109 of the Copyright Act in their entirety. Art 109, let it be recalled here, provides that contractual provisions less advantageous to creators of copyrighted works than those of the tables discussed in art 108.3 shall be null and void, to be replaced by the provisions of these tables. The idea was that this statutory provision is to safeguard the interests of the creative community vis a vis users of copyright and associated rights, what with the economic advantage which they generally enjoy. These were minimum fees. The proposed amendments, meanwhile, propose to introduce – the odd exception aside – fixed fees, the hope being that this will contribute to safety and predictability in copyright dealing. In light of my own practice, I do not entirely share in these hopes, for it is my experience that copyright users tend to regard such ‘’minimum” royalties as onerously high. In my opinion, it’s not how we define the royalty rates – fixed or minimum – that is important; the key issue is what kind of burden they will constitute from the perspective of copyright or associated right users. The main objection raised with respect to the old rules was that they do not envisage participation of copyright users as a party in the process of approving the royalty tables – as the statute then was, such participation was not provided for through operation of the law (…)