The regulations relating to the licensing and use of orphan works will come into force in October this year.
The regulations implement the European Directive on Orphan Works as adopted through the Enterprise and Regulatory Reform Act 2013 (the Act).
The regulations are particularly relevant given that increasingly, businesses use the internet to source content and the difficulty which this presents in identifying the authors of that content.
Remind me, what are Orphan Works?
Under the regulations, an orphan work is a work where, after a diligent search, one or more of the rights holders cannot be identified or located. By 'rights holders' we mean the owner of the copyright in the work.
Tell me more
Two statutory instruments will bring into force the new laws relating to orphan works and their use and licensing in October this year namely, The Copyrights and Rights in Performances (Licensing of Orphan Works) Regulation 2014 and the Copyrights and Rights in Performances (Certain Permitted Uses of Copyright Works) Regulation 2014 (the Regulations).
As you will see from their names, the Regulations effectively create two sub-sets of orphan works. Firstly those licensed by the authorising body which will be the Intellectual Property Office (IPO) and secondly those whose use is permitted by certain cultural institutions such as libraries, museums or educational establishments.
How do I know that the work is an orphan work?
The regulations state that a reasonable search of the relevant sources must be undertaken in order to ascertain whether or not an owner of the work can be traced. Such searches are described as 'diligent searches'. Diligent searches include a search of the register held by the Intellectual Property Office as well as the databases maintained by OHIM, the European equivalent of the IPO.
Where searches of these databases fail to reveal the owner, then the applicant must search the sources listed in the relevant schedules to the Copyrights Designs and Patents Act 1988 (as amended). These sources are also contained in the relevant schedules of the Regulations.
It is anticipated that the new Copyright Hub (www.copyrighthub.co.uk), currently being trialled, will assist potential applicants in conducting the requisite searches.
A diligent search will be valid for seven years.
How does the licence application process work?
The applicant must provide the Intellectual Property Office with details of the following:
- the diligent search; and
- the proposed use of the orphan work.
Once this is received the IPO will consider the application and if successful, will grant a non-exclusive license to use the orphan work in the UK only.
The licensee will have no right to grant sub-licenses.
The IPO may refuse to grant a license to use the orphan work if it considers that the proposed use is not appropriate. For example if it constitutes a derogatory treatment of the orphan work.
The term of the license may be granted for a maximum period of seven years.
A licensee may apply to renew the license for a further term not exceeding seven years. In order to be accepted the request must be accompanied by another diligent search.
What will it cost?
The IPO may charge a reasonable fee for processing the application of the license, or for varying or renewing an existing license.
The license fee itself will be calculated at the market rate which the IPO will calculate by taking into account relevant factors including fees for such similar licenses for similar works.
The license fee will be held by the IPO. If the owner of the orphan work is located within eight years from the date of the grant of the license the fees will be paid to them. If no rights owner is found or comes forward during that eight year period then fees may be applied to the cost of running the orphan works scheme and any surplus will be applied to social, cultural and educational activities.
Can I challenge the decision of the IPO?
A rights holder may appeal the conduct of the IPO on the grounds of acting inappropriately or failure to comply with its obligations under the Regulations.
Similarly, an orphan licensee may appeal the licensing or the refusal by the IPO to license the orphan work or, if relevant, the level of fees charged in relation to licensing the works.
Why is this important?
Whilst the finer details of the licensing scheme need to be finalised, the aim of the orphan works scheme is to liberate a body of work which historically has been unavailable for commercial use without fear of copyright infringement proceedings being brought.
This is potentially good news for commercial organisations wishing to use such works.
However, concerns still remain for copyright owners as many believe that the wording of the Regulations is ambiguous and may permit the IPO to grant rights in their work at a level of fees which would not be generally agreed by them or indeed, that the IPO will grant licences which they would never have entered into. Furthermore, such rights holders believe that the scheme erodes their rights in their work and therefore damages their business.
For more information about orphan works or copyright matters generally, please get in touch.
This document is for informational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given.