Posted on Tuesday September 27, 2022

Updated on Tuesday October 11, 2022

Out of Commerce Works FAQs: the Directive and its transposition

Explore these FAQs to gain a better understanding of the out of commerce works system, specifically questions related to the transposition of the Copyright in the Digital Single Market Directive.

Out of Commerce Works are materials in the collections of cultural heritage institutions, most likely protected by copyright, and no longer in commercial circulation. In mass digitisation projects, clearing rights to make these materials available online is often complex to an extent where it can become prohibitive.

In order to avoid a situation in which they are locked away from online access, the Copyright in the Digital Single Market (CDSM) Directive created a legal solution so that cultural heritage institutions (CHIs) from across the European Union could share these materials online legally without having to ask for permission on an item by item basis. The out of commerce works provisions in the CDSM Directive are an key opportunity for many cultural heritage institutions to overcome one of their most important copyright problems.

Members of the Europeana Working Group on Out of Commerce Works have developed FAQs to help readers gain a better understanding of the various characteristics of the out of commerce works system, so that you can successfully share more out of commerce works available online. The FAQs below cover questions related to the transposition of the Copyright in the Digital Single Market (CDSM) Directive. You can also explore questions related to key concepts in the Directive; stakeholder dialogues; and the system in practice.

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What should cultural heritage institutions advocate for throughout the transposition of the Directive?

Cultural heritage institutions are encouraged to follow the discussions at their member state throughout the transposition process, that is, as their national lawmaker makes changes to the national law to bring in the out of commerce works provisions in line with what is established in the Copyright in the Digital Single Market (CDSM) Directive.

More specifically, we encourage cultural heritage institutions to:

  • Advocate for a definition of out of commerce works that includes never in commerce works and is at least as clear and broad as what is established in the Directive’s article 8 and recital 37. 

  • Oppose the adoption of requirements not recognised in the Directive for conducting a ‘reasonable effort’ to determine that a work is out of commerce, in line with article 8 and recital 38. Additional requirements could lead to burdensome or prohibitive conditions that make the system difficult to comply with by cultural heritage institutions. Instead, best practices can be agreed through the stakeholder dialogues.

  • Make use of the option to adopt cut-off dates to simplify the determination of what is out of commerce 

  • In line with the Directive’s article 8 and recitals 31 to 36 and 39 to 44, ensure that the exception to copyright applies when no sufficiently representative collective management organisations exist for the specific type of work and right. The sufficient representativity of a collective management organisation should be based on a set of objective criteria. Have clarity on when to consider a collective management organisation ‘sufficiently representative’.

  • Encourage early stakeholder dialogues through which cultural heritage institutions, collective management organisations and rights holders, by area of work, can have a constructive dialogue to ensure that the system works in practice.

For more information on what to advocate for throughout the transposition of the Directive, we recommend consulting the Communia guidelines and the Guide for Libraries and Library Associations by EBLIDA, IFLA, LIBER and SPARC Europe.

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How do the out of commerce works provisions relate to the Orphan Works Directive?

The out of commerce works provisions in the 2019 CDSM Directive and the exception defined by the 2012 Orphan Works Directive are two distinct systems that can be used by a cultural heritage institution when clearing of rights of in-copyright materials. Cultural heritage institutions should evaluate which option is more suitable to clear rights in the specific collection, but it should be noted that the orphan works exception is more limited in scope and is likely to be much more burdensome to use. Below we outline some of the main differences of each of the systems:

  • Scope: the Orphan Works exception only applies to text-based, cinematographic and embedded copyright-protected material whose authors are not known or cannot be located. It thus leaves out relevant cultural heritage materials such as photographs and other materials that are not embedded. Instead, the out of commerce works provisions include any type of material as long as it was never or it no longer is subject to commercial exploitation. Most orphan works are likely to also be out of commerce. 

  • Obligations: The orphan works system requires a (cumbersome) diligent search to be conducted, with a list of mandatory sources and the obligation to record the search results. There is no such thing in the out of commerce works provisions, only a ‘reasonable effort’ to determine that the materials are out of commerce.

  • Exception, licence, remuneration/compensation: the orphan works system relies on an exception to copyright, in principle not remunerated, with no licence to be obtained. However, the opt-out by the rightsholder can lead to a compensation for the use made, to be paid by the cultural heritage institution. For out of commerce works, a licence should be obtained if a sufficiently representative collective management organisation exists. An exception applies if that is not the case. The exception is in principle not remunerated, and no compensation is foreseen for the use made in case of opt-out.

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How should cultural heritage institutions approach a situation in which the national transposition of the out of commerce works provisions is more restrictive or contrary to the Directive?

If a Member State does not adopt some of the mandatory or minimum standards set by the Directive, it fails to meet its transposition obligations. If the European Commission recognises that the transposition is not compliant, it may challenge this to the European Court of Justice.

For cultural heritage institutions, the safer option is to advocate throughout the transposition process for everything to be adopted according to the Directive. If this is not successful, cultural heritage institutions could consider:

  • Initiating a good faith dialogue with the government to highlight the challenges that the incorrect transposition creates for the cultural heritage sector and request that these are corrected;

  • Addressing a letter to the European Commission to bring the incorrect transposition to their attention;

  • Or as a last resource, challenging the incorrect transposition through national courts.

These FAQs have been developed by members of the Europeana Working Group on Out of Commerce Works. They were first published in September 2022. The aim of the working group is to continuously review these questions and recommendations in the answers. For any comments or suggestions, please reach out to copyright@europeana.eu

The information in the FAQs should not be used as professional or legal advice (if you need specific advice, we recommend consulting a suitably qualified professional).

Disclaimer: The International Federation of Reproduction Rights Organisations IFRRO is an active member of the Europeana Out of Commerce Works working group, has made an important contribution to the discussions, including for the development of these FAQs, and closely cooperates with Europeana on raising awareness within their respective memberships about out of commerce works. There are however divergences of opinion on some of the content, including certain advocacy and policy recommendations described in the FAQs.

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