[Random-bits] CPTech on Evaluation of EU Database Directive
James Love
james.love@cptech.org
Mon Mar 13 14:28:01 2006
http://www.cptech.org/ip/database/EUdatabase13mar06.pdf
CPTech Comments on DG Internal Market and
Services Working paper
First evaluation of Directive 96/9/EC on the
legal protection of databases
13 March 2006
Michelle Childs, Head of European Affairs
Consumer Project on Technology
24 Highbury Crescent, London N5 1RX
e-mail michelle.childs at cptech.org
1. Introduction
1.1 The Consumer Project on Technology/1/(Cptech) welcomes
the opportunity to comment on the working paper
evaluating Directive 96/9/EC on the legal protection
of databases (The Database Directive).
1.2 The legal frameworks that facilitate and shape the
development and management of knowledge resources are
crucial for all European citizens for both cultural
and economic reasons. It is essential that EU policy
both promotes innovation and creativity, and access
to knowledge.
1.3 The information resources that are subject to the
Database Directive restrictions are important.
Businesses depend upon information to innovate,
evaluate investments, and market products and
services. The public's ability to monitor the
activities of businesses or governments requires
information. Everyday discourses over politics,
sports and cultural activities are enriched and
empowered by access to information. Scholars,
educators and scientists depend upon access to
information. Information is the fuel of the
knowledge economy.
1.4 The rules that control such access to information
have a profound effect on both the creation of new
knowledge goods and services, and the public's access
to knowledge. Overbroad, excessive and unnecessary
restrictions on the use, reuse and sharing of
information harm Europe by undermining innovation,
and increasing prices and reducing access to information.
1.5 Summary
1.6 We commend the Commission's approach to the
evaluation of this Directive, which is based on
seeking empirical evidence to test whether or not the
original objectives behind the implementation of the
Directive have been fulfilled. There are further
improvements that could be made, but we think such an
approach should be adopted in relation to all reviews
of community law and in particular the upcoming
review of the Copyright law aquis.
1.7 We are concerned however about the reliance on
subjective data from the database industry (a
questionnaire to the European database industry on
their views of the projection) and apparent over
sensitivity to the views of the beneficiaries of this
special database protection.
1.8 The eventual outcome of this evaluation is a test of
the Commission's, and Member States, commitment to
the application of evidence based policymaking and
better regulation principles. The report
overemphasises the problems of changing regulation in
the face of industry opposition. While a pragmatic
statement in a working paper, it is a dangerous
precedent to use to guide the direction of future
policy making. Such an approach will undermine the
Commissioners deregulation agenda, encourage
protectionism, and foster the cynical view amongst EU
citizens and civil society that deregulation is a
one-way street. The Commission must 'stick to its
guns' on this point and place the burden on those
seeking the benefit of special protection to provide
objective evidence of its benefits. The Commission
must then test both the benefits and detriments of
the Directive for all stakeholders, not just the
right holders.
1.9 The results of the evaluation itself point to only
one outcome: Option one, the repeal of the Directive.
Of the three objectives stated for the creation of
the Database Directive, legal certainty, increased
investment in databases and access for users, none
have been successfully achieved. Nor is it possible
in our view, and that of legal experts, to
successfully amend the Directive, and the sui generis
right in particular, to overcome these problems.
Even with withdrawal of the Directive, original
databases will still be protected under the copyright
laws of Member States.
Background
1.10 The purpose of the Commission's evaluation is to
assess whether the original policy goals of the
Database Directive have been achieved. These were: to
remove existing differences in the legal protection
of databases in different Member States, by
harmonising rules that applied to copyright
protection; safeguard investment of database makers
and to ensure that the legitimate interests of users
to access information complied in databases were
secured. It sought to achieve these goals by creating
a two tier legal protection for databases. One gave
copyright protection to certain databases ('original'
databases) if sufficient creativity was used to
create the database. The second tier created a new
form of protection for other databases that is based
on projecting investment in compiling the data rather
than originality. This protection is known as a 'sui
generis' database right'.
1.11 The Database Directive has been controversial from
the start, particularly the sui generis regime, which
can cover facts and data that are generally already
in the public domain. It has been called 'one of the
least balanced and most potentially anti-competitive
intellectual property rights ever created.'/2/ As the
Report points out ''The sui generis' right is a
Community creation with no precedent in any
international convention'/3/. The US, which is seen as
the main competitor to Europe on the production of
databases, has no such right. Opposition to similar
legislation in the United States has been led by a
broad coalition of groups, including libraries,
consumers organisations, scientists, innovative
database companies, and the US Chamber of Commerce.
All of these groups argue that a database right
similar to that recognized by the European Directive
would make it more difficult to create new databases,
and create unwanted restrictions on the dissemination
of information to businesses, educators, scientists,
other non-profit organizations and the public at
large.
1.12 An attempt to adopt an International Treaty on the
Protection of Databases was rejected at a 1996
diplomatic conference held by the World Intellectual
Property Organisation (WIPO). Over the past 10
years, every effort to schedule a new diplomatic
conference at WIPO has been rejected.
1.13 The Commission working paper ends by asking for
comment on which of four policy options should be
chosen: Option One: repealing the whole Directive,
Option Two: withdrawing the 'sui generis ' right,
Option Three: amending the 'sui generis' provisions,
Option Four: maintaining the status quo i.e. do
nothing and leave the Directive as it is.
Comments on the Approach to Evaluation
1.14 We commend the Commission's approach to the
evaluation of this Directive, which is based on
seeking empirical evidence to test whether or not the
original objectives behind the implementation of the
Directive have been fulfilled. It is also important
that it now has sought comments on the four policy
options, there needs to be a wide public consultation
and a comprehensive, objective and transparent
assessment of public benefits and detriments./4/ Such an
approach should be adopted in relation to all reviews
of community law and in particular the upcoming
review of the Copyright law aquis.
1.15 The evaluation could be further improved, by
analysing the evidence collected in this comment
period using the revised list of impacts contained in
the Commission Staff Working Paper : Impact
Assessment: Next Steps./5/ The Working paper at present
generally defines stakeholders narrowly, as the
beneficiaries of the protection, rather than the
larger group including users. The Impact list
mandates that the analysis review the broader impacts
relevant to this area. For example, the review of
the impact on innovation and research, impact on
specific regions, sectors and workers (e.g. does it
have specific negative consequences for particular
groups of workers?), impact on consumer rights,
impact on access to social protection, health and
educational goods and services (Does the option have
an impact on services in terms of their quality and
access to them?).
1.16 We are concerned about the evaluation's reliance,
on subjective data from the database industry (a
questionnaire to the European database industry on
their views of the projection), which appears to be
given equal weight in the analysis with the empirical
study, and the apparent over sensitivity to the views
of the beneficiaries of this special database
protection.
1.17 The outcome of this evaluation is a test of the
Commission's, and Member States, commitment to the
application of evidence based policymaking and better
regulation principles. The purpose of objective
evaluation and impact assessments is to help avoid
the perception of bias and to seek to achieve the
best policy outcomes. Objective analysis has shown
that the policy objectives have not been met:
production of databases has not been stimulated, in
fact the reverse is true: the ratio of European to US
databases has fallen from nearly 1:2 in 1996 to 1:3
in 2004. Key users such as academics and librarians
have provided evidence of the Directive's effect on
restricting access to knowledge.
1.18 The report overemphasises the problems of changing
regulation in the face of industry opposition.
Repealing the sui generis right would probably lead
to 'considerable resistance by the EU database
industry.' While a pragmatic statement in a working
paper, it is a dangerous precedent to use to guide
the direction of future policy making. Such an
approach will undermine the Commissioners
deregulation agenda, encourage protectionism, and
foster the cynical view amongst EU citizens and civil
society that deregulation is a one-way street. While
deregulation has its place, it could appear that it
is only rolled back in areas to benefit business in
the face of civil society opposition, and retained to
protect industry special interests in the face of
civil society opposition. The Commission must 'stick
to its guns ' on this point and place the burden on
those seeking the benefit of special protection to
provide objective evidence of its benefits. The
Commission must test both the benefits and detriments
of the Directive for all stakeholders, not just the
right holders.
Comments on Policy options
1.19 The results of the evaluation itself point to only
one outcome: Option one, the repeal of the Directive.
Of the three objectives stated for the creation of
the Database Directive, legal certainty, increased
investment in databases and access for users, none
has been successfully achieved.
1.20 In relation to legal certainty the report states
that: 'National case law has highlighted the textual
ambiguities of the sui generis right ...Battles have
erupted over the precise meaning of 'substantial
investment' as contained in Article 7 of the
Directive'...This has caused considerable legal
uncertainty both at EU and national level.' Nor will
this uncertainty be mitigated by the rulings of the
ECJ, which limit the ambit but do not resolve the
problems associated with the sui generis right. In
addition, as legal experts have pointed out, the
database industry will develop different strategies
to circumvent these decisions/6/. Repeal will still
provide for copyright protection within Member States
for original databases, and the internal market would
not be affected, as the regimes have never been fully
harmonised.
1.21 In relation to the stimulation of the production of
databases in Europe, the report is damning, and even
states that it 'has had no proven impact on the
production of databases'. Indeed data has shown that
EU database production has fallen back in relation to
the US, which does not have such protection. The
database industry disputes this finding but does not
provide alternative empirical evidence to back up
this claim. The Association of Directory and Database
Publishers argued that the decline in database
'entries' is due to a shift towards the provision of
online information and a move away from CD- ROMs and
other such media. This point is in fact an argument
for the repeal of the Directive, not its retention.
1.22 The Database Directive when originally conceived
was based on the idea of a database as a fixed set of
data, sold as a tangible item in products like CD -
ROMs. The shift to on-line databases had significant
impacts on laws that sought to protect collections of
information, as Andrew Oram, Editor of O'Reilly media
recently argued:/7/
* Copying becomes more difficult (rendering the laws
even less relevant)
* In regard to determining how much copying is too
much, the new structure of information makes it hard
to determine how much of a total collection was
copied.
* The frequent updating of information renders copies
less valuable, reducing the incentive for someone to
profit by making extensive copies.
* Expiration times, which were designed to protect the
public by placing deadlines on the restrictions
imposed by database manufacturers, become moot
because the manufacturers keep updating the data.
Database owners are thus awarded a perpetual
protection (a further grant of 15 years) every time
the database is amended in a substantial way.
1.23 These technological and social changes call into
question the value and relevance of the Database
Directive, they do not support it.
1.24 In contrast users from the academic and scientific
community have provided evidence that the exceptions
to the sui generis right are too restrictive with
regard to access to and use of data and information
for scientific and educational purposes. Library
representatives have called for broader exceptions
and expressed fear about the monopolisation of
information.
1.25 Option Four- Maintaining the status quo is also a
non-starter. The Report offers several reasons for
this option, none of which are convincing. First,
database companies want to keep the Directive.
Though the report notes that their "endorsement is
somewhat at odds with the continued success of US
publishing and database production that thrives
without... [such] protection" but nevertheless
appears to be "a political reality".) Second,
repealing the Directive would reopen the debate on
what level of protection is needed. Third, change may
be costly/8/. The arguments in relation to industry
opposition and certainty have been dealt with above.
1.26 It is worth reinforcing though, the absurdity of
applying such reasoning to decisions over regulation,
which was highlighted in a recent article by
Professor James Boyle:
-----start quote------
'Imagine applying these arguments to a drug trial.
The patients in the control group have done better
than those given the drug, and there is evidence that
the drug might be harmful. But the drug companies
like their profits, and want to keep the drug on the
market. Though "somewhat at odds" with the evidence,
this is a "political reality." Getting rid of the
drug would reopen the debate on the search for a
cure. Change is costly - true. But what is the
purpose of a review, if the status quo is always to
be preferred?'/9/
-----end quote--------
Time to Consider an EU Directive on Access to Knowledge
1.27 The EU Directive on the legal protection of
databases was the wrong paradigm for innovation and
access to knowledge. The EU needs not only to
evaluate the impact of the directive on the creation,
dissemination and use of knowledge, but to evaluate
the policy assumptions that have lead us to a wrong-
headed and harmful result. Clearly key EU policy
makers have not fully appreciated the relationship
between access to knowledge and the creation of new
knowledge resources. Nor is there a clear
understanding of the benefits to the broad
dissemination and sharing of knowledge.
1.28 Over the past 10 to 15 years, the growth of the
Internet and the World Wide Web, the creation of a
plethora of public domain databases of scientific,
economic and cultural information, and the many new
innovations in collaborative and innovative
mechanisms to create, manage and share knowledge
resources, have shed light on the benefits of access
to knowledge, as a paradigm for development,
innovation, empowerment and growth.
1.29 WIPO is now debating if there is a need for a new
global treaty on access to knowledge, a topic that
has been the subject of an extensive multistakeholder
consultation. CPTech and others are now calling for
a new general agreement on the provision of public
goods (GAPPG) within the World Trade Organization
(WTO), modelled in some ways after the WTO general
agreement on trade in services (GATS). These new
ideas point to a more modern paradigm for the global
governance of the knowledge ecology -- influenced by
recent evidence that access, dissemination and
sharing of knowledge resources have very important
positive contributions to the economy and the public.
1.30 CPTech recommends the EU hold a public consultation
to consider the possibility or nature of an EU
directive on access to knowledge.
Further Information
Cptech would be happy to provide additional information.
Please contact in the first instance Michelle Childs,
Head of European Affairs, Consumer Project on Technology,
24 Highbury Crescent, London N5 1RX, e-mail
michelle.childs at cptech.org
---------end notes ---------
1. Cptech is an NGO, with offices in London, Geneva and
Washington DC. Currently much of our work concerns
intellectual property policy and practices, focusing on
access to knowledge, but some of it concerns different
approaches to the production of knowledge goods,
including for example new business models that support
creative individuals and communities. Full details can be
found on our website www.cptech.org. We are also a member
of the Transatlantic Consumer Dialogue (www.tacd.org)
which regularly meets with US and EU officials to discuss
IP policy.
2. J Reichman and P Samuelson 'Intellectual Property Rights
in Data?' 50 Vanderbilt L Rev 51, 81.
3. section 1.1 Page 4
4. http://www.adelphicharter.org/
5. SEC (2004)1377
6. 'Football fixtures, horse races and spin-offs: the ECJ
domesticates the database right' M.J. Davison and P.B
Hugenholtz, EIPR 2005 v27 n3 March.
7. 'Submission to the U.S WIPO delegation concerning
webcast rights'. Andrew Oram, Jan 9, 2006. Available
at: http://www.cptech.org/ip/wipo/bt/oram01092006.pdf
8. James Boyle 'Two database cheers for the EU':The
Financial Times 02/01/06. at
http://news.ft.com/cms/s/99610a50-7bb2-11da-ab8e-
0000779e2340.html
9. James Boyle : as above
---------------------------------
James Love, CPTech / www.cptech.org / mailto:james.love@cptech.org /
tel. +1.202.332.2670 / mobile +1.202.361.3040
"If everyone thinks the same: No one thinks." Bill Walton