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© 1996 - 2008 European Publishers Council All rights reserved
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EPC news - February 2008Your monthly EU media issues update direct from Europe's leading publishers
Dates for the diary29th February - Deadline for consultation on Creative Content Online
Key issues of the monthNew VAT rules adoptedNew VAT rules on services have now been adopted by the Council including a significant change in the rules on the place of taxation. Most types of service will now be taxed in the member state of consumption rather than that of provision. At the same time, the package introduces the possibility for taxpayers who perform certain services to fulfill their EU-wide VAT reporting obligations in one single member state (using a "mini one-stop shop") and thus reduce their compliance costs. The package, which includes two draft directives and a draft regulation, also provides for improved mechanisms for cooperation between member states in order to prevent tax avoidance under the new system. The so-called VAT package will as a general rule enter into force on 1 January 2010. The main features of the new rules are as follows:
The VAT package contains:
The new rules will come into force on 1 January 2010.
Broadcasting: Commission investigates possible competition distortion in publicly funded broadcastingThe EPC is currently preparing its response to a Commission questionnaire on the issue of publicly funded broadcasters and distortion of competition. On the basis of this questionnaire, the European Commission will investigate how publicly funded broadcasters have expanded and use new media, in order to determine whether state aid to broadcasters is unfair to commercial competitors. The commission is re-examining the rules (set in 2001) in the light of its duty to preserve fair competition when the media landscape is changing profoundly. "This implies in particular the need for a clearly defined public service mission as well as a limitation of state aid to what is necessary for the fulfilment of this mission, excluding overcompensation and possible cross-subsidies into commercial activities," a commission statement said. State aid to all industries is limited by the Commission in an attempt to foster free market competition both within and between nations. Countries can fund public service broadcasting, but Commission rules are designed to stop that process skewing the market for commercial broadcasters. The consultation process ends on 10 March, and the commission said if it needed to issue a new set of rules, a proposed set would be published later this year.
Creative content online: EPC prepares response to Commission consultationThe Commission has now published the long-awaited Communication on Content Online. The Communication includes supportive references to the ACAP Project. In the Commission's news release, it says: "The European Commission has decided to give a new boost to Europe's online content sector. EU citizens should be able to enjoy easier and faster access to a rich variety of music, TV programmes, films or games via the Internet, mobile phones or other devices. The Commission therefore encourages the content industry, telecoms companies and Internet service providers to work closely together to make available more content online, while at the same time ensuring a robust protection of intellectual property rights. The Commission also wants to facilitate copyright licences for online content covering the territory of several or all of the EU Member States. According to Commission studies, a truly Single Market without borders for Creative Online Content could strengthen considerably the competitiveness of Europe's music, film and games industry and allow retail revenues of the sector to quadruple by 2010 if clear and consumer-friendly measures are taken by industry and public authorities (see IP/07/95)." "Europe's content sector is suffering under its regulatory fragmentation, under its lack of clear, consumer-friendly rules for accessing copyright-protected online content, and serious disagreements between stakeholders about fundamental issues such as levies and private copying", said Viviane Reding, EU Commissioner for the Information Society and Media. "We have to make a choice in Europe: Do we want to have a strong music, film and games industry? Then we should give industry legal certainty, content creators a fair remuneration and consumers broad access to a rich diversity of content online. I will work on these issues with my colleagues in the Commission and propose a Recommendation by mid-2008 on new ways for achieving a single market for online content. I ask in particular Europe's consumer associations to take a very active part in this debate. Because for online content, the demand and preferences of 500 million potential consumers are the strongest arguments for achieving new solutions at EU level." The consultation deadline is 29 February. The EPC is preparing its response. In addition, the Commission will set up the "Content Online Platform", a stakeholders' forum, to initiate collaborative work with all stakeholders on issues where further discussions are needed. Consumers will be given a strong voice in this platform.
Freedom of expression: MEPS demand freedom of expression on the webThe European Parliament is demanding better internet access and guarantees for the freedom of expression on the web, according to an own-initiative report adopted by large majority on 17 January in Strasbourg. This report more specifically concerns the second Internet Governance Forum organised in Rio de Janeiro (Brazil) from 12 to 15 November last year, on the initiative of the United Nations. On this occasion, the EU and the Council of Europe emphasised the protection of children on the web and the protection and promotion of freedom of expression. They also insisted on the need to guarantee the opening and accessibility of the internet in order to promote diversity, as well as online technologies and identification by radiofrequencies (RFID). In their joint resolution, MEPs ask the EU institutions to take account of the conclusions of the 2005 World Summit on Information Technology in their legislative work, such as the revision of the regulatory framework for telecoms and the i2010 Strategy [this is the European Commission's strategic framework, adopted in June 2005, defining the major guidelines for information society and the media]. "The internet must become accessible to more people, for example, through competition between operators and service providers," as well as technology neutrality and the development of information and communication technologies, says the EP, according to a press release. The EP had sent a delegation of four MEPs to Rio: Maria Badia i Cutchet (PES, Spain), Malcolm Harbour (EPP-ED, UK), Gunnar Hökmark (EPP-ED, Sweden) and Catherine Trautmann (PES, France).
Data protectionMEPS scrutinise Google-DoubleClickMEP members of the European Parliament Committee on Civil Liberties debated the proposed Google-DoubleClick merger on 21 January. Issues of importance to publishers include some important themes on data privacy that could impinge on publishers' marketing strategies. Some MEPs warned of the risks that the proposed merger could pose on personal data protection. If approved, this merger would give Google the capacity to use its own information based on searches and the content of emails in GMail accounts as well as the profiling tools of DoubleClick, the market leader in online targeted advertising or "behavioural marketing". The European Commission has said that it will announce its decision on 2 April on the basis of an anti-trust investigation.
BroadcastingTax the new to fund the old, says French PresidentFrench President Nicolas Sarkozy has proposed that France's main state-run broadcasters should become ad-free zones, with their funds for programming raised via taxation on other media sources. The internet is reportedly one of the areas the government is considering taxing. Currently, all France's broadcasters carry advertising. There are strict limits as to the sort of advertising which can be shown and when they can be broadcast. The President's announcement that these should be ad-free sent shares in privately-owned broadcasters like TF1 and M6 soaring: The markets believe that denied advertising on the likes of F2 and F3, advertisers will flock to commercial channels. The fact that one of the means by which Sarkozy proposes to fund state channels is a tax on the profits of commercial broadcasters didn't outweigh shareholders' enthusiasm for the measure. Nicolas Sarkozy's controversial proposal to tax new media and give the money to struggling old media has hit with some tough opposition this week from Europe's top geek: Viviane Reding, the EU's telecommunications commissioner. At a new media conference in Munich, Ms Reding said that such a plan would do more harm than good.
TelecomsEurope leads world in high-definition convergence, says CommissionerSpeaking at a recent conference on the revolution of high-speed broadband, Commissioner Reding said the future of high-definition convergence depended on trusted services, open access to rich, professional and user-generated content and open, reliable and cheap bandwidth. According to Mrs Reding, European countries are world leaders in convergence: (Denmark, Sweden, the Netherlands, Finland and Belgium) ahead of even South Korea and Japan, while the USA has slipped behind in take up. "In July 2007, we had over 90 million connections in the EU25, 10 million up on January 2007. The average penetration rate of the 27 is at 18% and rising fast."
Brussels turns on per-minute phone tariffsThe European telecoms regulatory body (ERG) published, on 17 January, its first report to assess the impact of the EU's recent roaming regulation, which introduced a cap on prices for phone calls made across EU borders. The report estimates the discrepancy between the billed minutes for a phone call and the actual time of the conversation at 20%. "A customer may only use twenty seconds of a call but be charged for a full minute", explains a European Commission press release issued to comment on the results. The calculation is resticted to roaming calls, constituting a relatively marginal share of the average user's bill. However, charges for roaming calls are becoming increasingly signficant and are currently the only part of the bill that the EU is allowed to regulate. General mobile phone charges are left to market forces due to the Commission's assessment that there is sufficient competition in the sector.
Copyrighti2010: Digital Libraries Initiative - Europe's cultural and scientific heritage at a click of a mouseAn interim report on how best to promote and to make use of public-private cooperation and private sponsorship for the digitization of Europe's cultural heritage was published on 14 January. The report identifies opportunities and conditions under which PPP can be successful for all involved parties: private actors, public authorities and citizens. The Sub-group on PPP, chaired by Ms Lynne Brindley (Chief Executive of the British Library), is expected to present a final document by Spring 2008. On the basis of a rich set of case studies, the report analyses issues relating to the use of public-private partnerships, including success factors, choice of partners, business models, IPR, protection of the public domain and exclusivity issues.
Copying CDs could be made legalCopying music from a CD to a home computer could be made legal under new proposals from the UK government. Millions of people already "rip" discs to their computers and move the files to MP3 players, although the process is technically against copyright law. Intellectual property minister Lord Triesman said the law should be changed so it "keeps up with the times". Music industry bodies gave a cautious welcome to the proposals, which are up for public consultation until 8 April. The changes would apply only to people copying music for personal use - meaning multiple copying and internet file-sharing would still be banned. Owners would not be allowed to sell or give away their original discs once they had made a copy. "To allow consumers to copy works and then pass on the original could result in a loss of sales," the proposals warn. UK music industry body the BPI said it supported the move to clarify the law for consumers, but warned that any changes should not damage the rights of record companies. The Association of Independent Music (Aim) said the proposals did not go far enough - pointing out that CDs could become obsolete in the next decade. It said that, once CDs are replaced, the law could be misused to "open the floodgates to unstoppable copying", adding that it would like to see copyright holders compensated when music was copied. Lord Triesman said the proposed changes would explore "where the boundaries lie between strong protection for right holders and appropriate levels of access for users". The proposals also suggest schools and libraries should be given greater flexibility in how they use copyrighted material like CDs and DVDs, and suggests parodies of songs and films could be made exempt from copyright law. The consultation follows the Gowers Review of Intellectual Property, which recommended that aspects of the intellectual property system should be reformed.
ISPs under fire from music industryThe music industry took a firm swipe at internet service providers (ISPs), accusing them of being in large part responsible for the dramatic loss in profits record labels have suffered as a result of illegal downloading. In a strongly worded statement, the IFPI - the music industry body - called for the EU to draw up legislation that would place obligations on ISPs to monitor the traffic across their networks, and to suspend the accounts of customers who broke the law. In its annual report, the IFPI said that revenue from digital downloads had risen by 40 per cent to $2.9 billion in the past year, but that this had not been enough to offset the "sharp decline" in CD sales which had resulted from "systemic piracy" on the internet. "Copyright theft has been allowed to run rampant on their networks under the guise of technological development," John Kennedy, the IFPI's chief executive and chairman, said. "ISPs have largely stood by, allowing a massive devaluation of copyrighted music." "This in turn has prompted a crisis that has wide implications for the whole digital marketplace. The moment for EU legislation to be drawn up has arrived." Mr Kennedy's ultimatum was delivered as IFPI reported that revenues from digital music now accounted for 15 per cent of overall sales, but that the growth of digital sales had dropped from nearly 100 per cent between 2005 and 2006, to 40 per cent last year. The IFPI estimated that 1.7 billion tracks were downloaded in the past year, but that for every song accessed legally, 20 were downloaded illegally using so-called 'peer-to-peer' networks.
Information SocietyA child's right not to be exploited onlineThe rights of children - in particular the right of protection from paedophiles operating on the internet - has been the subject of recent discussion by MEPs. The world-wide-web has created a new area of anonymity for those preying on children, with child pornography being rampant. It is illegal to exploit children via the internet and several cases have shown the police are capable of tracking down offenders. A bleak assessment of the problem by Interpol says that "the internet...and digital cameras have made it easier for individuals with a sexual interest in children to record their activities". A major problem for law enforcement agencies is that many sites and children being abused are not in the EU - but in the developing world. In a speech on children's rights in Berlin in June last year the EU's Justice Commissioner Franco Frattini told delegates he was "saddened and shocked" to hear that the number of sites with child-sex material went up 1500% from 1997 to 2005. The Angelilli report, which is under discussion, lays down a number of options to deal with these disturbing trends. Blocking credit card payment for paedophile material is one step advocated by the report. This would involve cooperation with credit card companies to get them to block certain sites from receiving money for the material they sell. Stopping access to sites is another possibility. This would mean internet service providers and search engines using technology available to hamper access to dangerous sites. Closing down sites is another option, although this could only be done if they are based in the EU. These steps would go hand in hand with a database of sites that sells child pornography. Finally a website dedicated to the rights of the child - so they know what rights they have - is another idea in the report. In an effort to tackle the growth of child pornography on the internet and in print EU ministers agreed in 2004 what constitutes an offence, making the production, dissemination and transmission of child pornography illegal and also making it an offence to offer, make available or possess child pornography. There is a "safer internet" programme running across Europe that aims to warn people of the dangers the internet can pose to children. Young people are drawn to the internet by its fascinating variety - the Angelilli report aims to stop those who prey on children from using this interest against them.
CompetitionEuropean Commission welcomes Apple's announcement to equalise prices for music downloads from iTunes in EuropeThe European Commission welcomes Apple's announcement to equalise prices for downloads of songs from its iTunes online store in Europe within the next six months. This puts an end to the different treatment of UK consumers who currently have to pay higher prices for downloads. The different treatment to UK consumers was a major concern for Which?, a UK consumer protection organisation, who filed a formal complaint with the Commission. The Commission's antitrust proceedings have also clarified that it is not agreements between Apple and the major record companies which determine how the iTunes store is organised in Europe. Consequently, the Commission does not intend to take further action in this case.
LabellingCommission to adopt revised rules on food labellingThe European Commission has adopted a proposal to make food labels clearer and more relevant to the needs of EU consumers. The proposal aims to modernise, simplify and clarify EU labelling legislation and to amend the rules so that they better meet the needs of consumers. According to the Commission, by ensuring that the information on food labels is simple, legible and not misleading, and that nutritional information is presented in a clear and uniform manner, the aim is to allow EU citizens to make informed choices in relation to the food that they buy. The proposal also aims to better meet the needs of industry, by laying down clear-cut rules which are proportionate and flexible to the constantly changing market, and which do not pose unnecessary burdens.
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