Germany: Fight Escalates Over Copyright Fee For Computers

By Monika Ermert for Intellectual Property Watch
The fight between German collecting rights societies and hardware companies is escalating.

This week the CEO of the society for musical performing and mechanical reproduction rights, Harald Heker, heavily criticised the German Association for Information Technology, Telecommunications and New Media (BITKOM), claiming it was denying authors and artists their well-earned remuneration.

Heker was reacting to an earlier statement from BITKOM clearly rejecting the amount of 15 euros copyright levies for a multimedia personal computer (PC). The amount was recommended by the Arbitration Centre of the German Patent and Trademark office that had tried to settle the fight between parties that are deeply divided over what amount of copyright levies should be paid for a PC.

From the view of GEMA and other collecting right societies, it is simple: PCs allow their users to make private copies of texts, audio and video data distributed over the Internet. As private copying cannot be stopped, and legislation has allowed it given that the creators of works would be compensated, copyright levies have to be paid for the new device in the same way as it is paid for copy machines or recording media like CD, DVD or, much older videotapes or cassettes. The money is channelled back through the collecting rights societies to writers, composers or others.

“Consumers already are charged higher prices to make up for the copyright levies,” said Heker. “Yet the money is not transferred to the copyright holders, but used by the hardware manufacturers to maximise profits.” While users certainly were prepared to pay the price for the convenience of private copying, hardware manufacturers obviously showed no interest in this, he said.

GEMA and the other collectors organised in the ZPÜ are now considering further legal complaints, said Elfriede Rossori, spokesperson for the GEMA in Munich. The ZPÜ originally demanded 18.42 euros on the purchase of a PC, she said.

BITKOM, on the other hand, warned about high copyright levies given the fact that the 15 euros would only be part of what would have to be paid per PC. BITKOM calculated that the total sum of 36.21 euros would be charged per PC, including levies on an integrated CD (7.21 euros) or DVD burner (9.21 euros), the reprographic capacity of the PC (12 euros according to a 2003 decision by the arbitrators), and the new audio and video functions of the PC (15 euros). The burner part already is paid for by industry, the 12 euros for the reprographic part is still being fought in the courts. Collectors originally had asked for 30 euros for that special part.

Adding to concerns over the expense is that the collectors want the money to be paid retroactively from 2002. With about 13 million PCs sold in Germany between 2002 and 2005 this would add up to over 350 million euros up to 2005 alone. PC users now also have to pay various other fees to satisfy rights owners, for example the fee for public broadcasters. Altogether, over four years the use of a PC bundled with a multifunctional printer could cost 406 euros in copyright levies, BITKOM calculated.

The companies in BITKOM now are consulting about their next steps, said Judith Lammers, lawyer and copyright expert at BITKOM. “You cannot burden users with all these levies, so some has to be shouldered by vendors or industry themselves. There’s a competition issue in this because neighbour countries do not have such a levy system.”

Another concern is that enforcement is mainly targeting large firms. The ZPÜ has demanded the 18.42 euros from 22 large PC companies and importers like Fujitsu-Siemens, Dell and Hewlett Packard. While BITKOM clearly rejected the rate it was still unclear if there would be 22 complaints or if the parties would agree on an exemplary court case. There is no class-suit action in Germany as in United States law.

This year, parties are trying to get to grips without help from legislators and arbitrators. The reformed copyright law hands over negotiations to collectors and industry. GEMA warned the BITKOM position did not make much hope for the future system. Lammers said she was confident that the parties would be able to settle the differences with no intervention from government.

Monika Ermert may be reached at info@ip-watch.ch.