The new German draft copyright law introduces a new exception in Article 52a (pages 4 and 53 of the draft) that implements Article 5 Nr. 3 n) of the 2001 information society copyright Directive. That reads:
"3. Member States may provide for exceptions or limitations to the rights provided for in Articles 2 and 3 in the following cases: (...)
n) use by communication or making available, for the purpose of research or private study, to individual members of the public by dedicated terminals on the premises of establishments referred to in paragraph 2(c) of works and other subject-matter not subject to purchase or licensing terms which are contained in their collections;"
The German draft gives non-commercial libraries, museums, and public archives a right to display books they have bought electronically on terminals in the library. They have to pay for that right to a collecting society. Any contract with a publisher about this matter overrides the exception.
There was not much controversy about this proposal in the debate leading to this draft, so it seems to be a balanced approach.
The interesting question is what this means for the Google library project.
As far as German copyright law is concerned, the Google project is obviously illegal. This proposal changes nothing in that respect.
Is there any meaning for the fair use analysis under Section 107?
Here the last factor seems to be relevant. "Effect of the use upon the potential market".
Clearly there is a value for libraries to be able to display the content of books in digital form to their users. The new German proposal recognizes this value by ordering libraries to pay for this right. Clearly there are also publishers out there who approach libraries and get some kind of contract on that right. The draft recognizes this market reality by giving these contracts priority over the legal exception.
Tony Sanfilippo, marketing and sales director for Penn State University Press, makes this point in a October 2005 letter to the Wall Street Journal:
"My primary objection is that we will lose the opportunity to sell those digital files of our content ourselves. These libraries are among our best customers. Each of the libraries in question probably has 70% to 90% of what we've published over the past 50 years. The files of just our content that Google is giving each library are conservatively worth tens of thousands of dollars, if we had been allowed to sell them those files. The libraries involved have all bought or subscribed to our digital content in the past. Now they won't need to anymore."
So the uncontroversial decision of the new German law backs up the complaint of the publishers that Google's copyright violation is ruining their market chance to sell libraries digital copies of their content, which is one factor in the fair use analysis under Article 107.
Posted by Karl-Friedrich Lenz at April 2, 2006 11:31 AM