The Italian Regulatory Authority for Communications (AGCOM) has recently published the “The Regulation for The Intermediation of Copyright and Related Rights” in compliance with the EU directive of April 17th 2019, better known as Copyright Directive (EU Directive 2019/790). The Directive has been adopted with the purpose of modernizing and harmonizing the European normative framework on copyright, aiming at guaranteeing a fair remuneration for authors and artists, improving transparency in contractual relationship and facilitating the cross-border access to copyright protected content in the single digital market.
By the deliberation no. 95/24/CONS published on May 16th 2024, AGCOM has approved the implementing regulation of the Directive which aims to make the general principles of good faith, fairness, transparency and information applicable to the different types of use of audiovisual works, clarifying moreover the intervention of AGCOM in the acknowledgment of a compensation suitable and proportionate to the use of the protected works. The text is the result of a long and complex public consultation and has been elaborated with the ultimate goal of coordinating and integrating the different existent normative sources, by providing “elements of certainty and tools of practical application” for all subjects working in the field.
The main new features introduced by the Regulation are described below.
The Assistance Role of AGCOM
Provided the contractual freedom between authors and performing artists or performers (in Italian called with the acronym “AIE”) and their counterparts, the Regulation establishes that in case of difficulty in reaching an agreement for the grant of a license to use audiovisual works on on-demand video services, both parties can request the assistance of AGCOM, which intervenes to facilitate the conclusion of the agreements by providing non-binding directions on the suitable negotiable solutions and, if appropriate, by presenting proposals to the parties, even in relation to the determination of the due compensation.
Information and Transparency Obligations
The Regulation provides that authors and AIE have the right to receive updated, relevant and complete information on the use of their works and artistic performances and on the compensation due by the subjects to whom they licensed or transferred the rights.
Information concerns in particular:
- The identity of all subjects interested by the assignment or licenses, included the secondary users;
- How works and artistic performances would be exploited;
- The revenue generated by such uses, including advertisement and merchandising revenues and the compensation contractually due;
With specific reference to audiovisual media service providers:
- Numbers of purchases and visualizations generated in the period of reference;
- The number of subscribers.
AGCOM monitors the compliance to these informative obligations and can impose sanctions in case of infringements.
The Contractual adjustment mechanism
A key aspect of the Regulation concerns the contractual adjustment, designed to correct situation where the economic conditions of a contract appear to be unfavorable to authors and AIEs. If the compensation initially negotiated in contracts results to be disproportionately low compared to the success reached – ex-post – by the work, authors or AIEs can file a request to AGCOM to rebalance the contract and obtain a suitable compensation (the so-called fair compensation).
AGCOM examines whether the elements in support of the request of adjustment are enough to verify its admissibility and if the request is accepted, it starts a formal proceeding. During the proceeding, the parties have the possibility to submit pleadings and documents to support their positions and can be called for a discussion hearing. Once the investigation phase is concluded, AGCOM’s collegial organism can define the episode by issuing an order to adjust the compensation due to the applicant and, in case of failure to comply, AGCOM can impose an administrative fine that varies between 10,000 and 250,000 euro.
The requirements of representativity of collective management organisms
The Regulation also defines the criteria to measure the representativity of collective managements organisms, also known as “collecting societies”. These criteria are essential to identify the authorized organisms to issue extended collective licenses for stateless rights owners, that is for those who are not associated to any organism.
A technical attachment to the Regulation provides detailed operative indications for the calculation of representativity, taking into consideration the category in which the owners of the rights fall into, the types of exploitation, the relevant users and parameters linked to the effective use of the works.
The alternative resolution of disputes procedure
Lastly, the Regulation regulates AGCOM’s intervention procedures to settle disputes between authors and AIEs and their counterparties, including those disputes referring to the violation of communication and information obligations in license and transfer contracts of exclusive rights.
AGCOM intervenes upon request of the parties, starting a proceeding which can include hearings and presentation of documents. The rules of the regulation do not exclude the possibility to resort to ordinary judicial ways: if a party starts a judicial proceeding or a conciliation, a mediation or an assisted negotiation, the proceeding before AGCOM can be suspended at the discretion of the Direction of the Authority.
In conclusion, the Regulation – in addition to the preceding implementing regulations of articles 43-bis (resolution no. 3/23/CONS) and 102-decies (resolution no. 115/23/CONS) of the Italian Copyright Law (l. 633/1941) – completes the implementation of the EU Copyright Directive.
With this intervention, AGCOM makes a significant step towards more equity and transparency in the field of copyright, providing a range of protection for authors and artists, assuring them an equal and proportionate compensation to the success of their works and providing practical tools to settle disputes, in a market increasingly dominated by digital platforms, where economical dynamics can evolve rapidly. A clear and coordinated normative framework therefore takes form, which guarantees an effective protection of copyright and related rights in Italy as well.
Teresa Franza