Assessing the economic impacts of adapting certain limitations and exceptions to copyright and related rights in the EU

Assessing the economic impacts of adapting certain limitations and exceptions to copyright and related rights in the EU:second part, May 2014.
This report is the second part of a wider study, commissioned by DG Internal Market and Services, that aims at assessing targeted changes in European copyright law, with a focus on exceptions and limitations to copyright, as a response to technological advances. The first part of the study is the report by Charles River Associates “Assessing the economic impacts of adapting certain limitations and exceptions to copyright and related rights in the EU” (Langus et al., 2013, henceforth “CRA Methodology Report”), which establishes a methodology to assess exceptions and limitations to copyright.

While the report identifies the channels through which copyright exceptions affect total welfare1, it argues that on the basis of theory alone, one cannot make a case that technological advances (resulting for example in a decrease in the cost of copying and extended consumer uses) call for broader or narrower exceptions. Indeed, there are opposing effects at play and only a detailed assessment of the trade-offs involved taking into consideration the specificities of the exceptions considered can lead to such a conclusion.

In turn, the present report uses the aforementioned methodology to assess the economic impacts of specific policy options in several topics of interest, in view of providing policy guidance on these topics. This report focuses on the following topics:

•  Digital preservation by cultural heritage and educational institutions;
• The provision of remote access by cultural heritage and educational institutions to their collections for the benefit of their patrons;
• E-lending by publicly accessible libraries;
• Text and data mining for the purpose of scientific research;
• Reproductions made by natural persons for private uses.

For each of these topics, we first provide a general assessment of the current landscape (the Status Quo). As discussed in detail in the CRA Methodology Report, free markets for copyrighted works may or may not deliver socially efficient outcomes. When markets perform efficiently, there is no reason for a market intervention. But when markets for copyrighted works are likely to be inefficient, an exception can, in principle, provide a partial remedy. We thus view exceptions as partial remedies for potential market failures and assess the rationale for an exception on the basis of our assessment of the Status Quo. We close each section with the assessment of specific policy options for the topics considered.