MARTIN: So today I'd like to talk about something that might seem abstract, but I think it's very interesting; because it might inform our thinking about whether we should introduce new IP rights, and under which conditions we should perhaps introduce new IP rights.

So essentially the background of this is that you know today we still hope that the policy should be made based on evidence and I'm pretty sure that people in Glasgow are very well aware of that because Martin and the entire create is at a forefront of pushing this idea that IP law and copyright law in specific should be based on on on the sound evidence so we shouldn't be introducing new IP rights when there's no evidence that they will do something good or when there's evidence that will do something bad for the society and the question is how far the evidence can take us and the question also is what to do if evidence tells us evidence tells us that that actually the rights as we as we have legislated them do not really work and we would preferably want to get rid of them and how realistic it is to really do that so perhaps is the starting point you all are aware that IP rights are sort of understood among citizens but also among policy makers mainly as a sort of a toolkit to achieve something that is to to steer creativity to stimulate innovation and perhaps also to distribute the benefits of innovation in a particular way through the market but providing the tools to the creators and innovators who can then take advantage of them and trade them on the market for money and use the money to sustainable and an innovation so if you take sort of the European look to the policy making I think it's fair to say that in the past so in the very early days for for EU IP was mostly conceived as obstacle namely as an obstacle to cross-border trade so we had many IP cases that were about you know someone having an IP right in Germany someone else having an IP right in France and they try to use these right to partition the markets or even the same order having the rights in two different countries and trying to prevent the cross-border trade and as you know the idea of the of the EO was to actually facilitate the prosper frame so the the first view was actually the one of the obstacles so that's why also when the legislation in this area was coming up the idea was that we want to harmonize the differences between different legal systems so that we can so we can have a smooth post border frame now this has changed later when together with the idea of of IPs an obstacle we understood that IP IP rights are also about incentives so you know with with some directives such as biotech the record if it was recognized that what we are doing is introducing legislation to on one hand steer innovation in a particular area and also to remove the barriers in the in the European European space now if you look at what is happening recently it's all of these things and on top I would suggest that we also see that now the European legislature is also looking at a landscape wholly through the prism of incentives also any situations where no obstacles really need to be removed in other words the really no different approaches in the Member States that would somehow to be harmonized and overcome by legislation rather than legislature comes up with the new tool with hope of some benefits that it tries to achieve and and this is I would suggest the example we see this with a couple of initiatives that came up in the last couple of years so this is sort of a shift but what this does is when I come back to evidence is that money coming with new on the European let'em that are not really piston before on the national level you really have no idea what they will do your very little precedently are very little you know in terms of trig record so it's very black box that you are putting on the European level and essentially my question is okay if you do that then was what can happen if you figure out later on that it was it was a bad idea so to get some some context what kind of rights I'm talking about so the example of this where I would suggest that he used sort of a came up with a unique legislative framework for the first time was database right he motivated in 90s with idea that we buy idea that we should and we should spur the database industry this is how they called it back in the days and that Europe is somehow lagging behind and you know the way to do it is to introduce new exclusive but of course at the same time to some extent there were already some ways how to protect database and this directive also prevents that kind of fragmentation on the national level but I would suggest the main main sort of way of looking at the database directive was okay we want to simulate certain type of activity in that case database creation so that we can have brighter futures now we'll discuss that in a second whether that happened but the same thing I think is happening also with some other words they're being proposed discussed such as data producers right so you might have heard about that the idea that you know pushed by car manufacturers that they should get some right to the data that are collected by by their machines or news publishers right the idea that a publishers should also have some right in parallel to authors to their today news publications or sports organizers right the idea that those who organized sports events should perhaps have some exclusive rights with respect to the the actual events that are taking place in the same way as our IP so those are all ideas or proposals in different stages you know the news / news publishers right is now in the in the package for the copyright reform data producers right it was kind of on fire but it's not anymore and it sports organizers right somehow ended up in the proposal but is likely to be kicked out now my question here is how sticky these legislative choices so if the EU decides to have these how sticky artists now what do I mean by sticky obviously whenever those opposed often you if you read the first questions you ask yourself first question you ask yourself will benefit outweigh the costs well the new creativity that I will gain thanks to these two be outweighed by the cost social calls that I will trigger by creating this new IPA and that's obviously the most important question that we always ask ourselves this is where a lot of this debate that you hear about the Google tax for the news publishers right is is it a good idea will actually create more money for the for the news publishers yes or no and if it will create at what cost for for other people citizens or out of businesses now this is not what I mean when I asked for the rights whether these rights are sticky obviously I what I'm interested in is can we undo these legislative choices if we have decided for them in the past and if so how difficult is it and and even at this question you can look from two different ways one is looking at sort of from political economy perspective essentially asking okay is it feasible that the legislature will ever decide in a political climate that it will be a political will to abandon some rights and won't there be a strong lobbying against a position of such rights all right so that's one of the ways that you can look at that but that's not the one that I'm interested what I'm interested in a sort of a very easy a view of okay so if you put this right in the legal system that legal system has some institutional as well as legal safeguards and those will prevent a change for better or worse and which might make it difficult for you to actually undo your ptosis fully or will make it subject to some constraints so let me be more more concrete so let's first look at the institutional setup and how that can limit whether the legislature can do so here think about this experiment that we have started with in 90s 1996 the directive about the legal protection law databases was passed on to you and the idea was as I said we should boost database industry now this directive was since evaluated twice where it used the benefits that we we have talked for and consistently in the first and second evaluation the picture that is emerging is essentially well the sue Jenna's dead base rights are one of the rights that was created to actually spur this investments in this area did not bring any substantial benefits to society but at the same time it did not harm the industries okay so you can see the EU based on the evidence then they got her actually admitting which is very you know doesn't happen that often admitting that the the experiment itself didn't breeding work now you know we used to shoot through this IP right that most of the world doesn't have and you know it doesn't seem to doesn't seem to bring much evidence that it does and at the same time you know they find that there's no hardware much much harder for these this new right leader and hence they decide not to repeal now this can sort of become intuitive because you would ask yourself well but if it turned out that it's not working I mean it would be natural to respond by this repeating right so why keep it if it's not working so I was kind of triggered by this and I won't break okay so what does it tell us about what does it tell us about the system if you actually even admit in public that a right is not working but then you're not ready to take a step to actually repeal it and when you start thinking about the institutional setup and I think this starts making more sense though it pains a little bit of mourning picture namely that if you think about it you and many things in the you are having us through the rares so not everything that many things are harmonized through the rectus which is the case also the database directive and a contract reform that is upcoming which might bring the news publishers right now visas directives or directives to the member states and then the state's and then have to implement the loss in order to effectuate change so yet this yet the EU obviously composed of the Member States telling the Member States and the Member States passed the law and tell the citizens and then citizens of Jeff's okay not a problem of that is in case we want to repeal the rights that means obviously you can always repeal the European Park so you repeal the directive but if you repeal the direct it doesn't do much because you just repealed the directive you repeal and take away the European identity and the national laws that were there to implement the director will stay in place so essentially you're not changing anything you just remove the European identity and if the Moscow State so the national walls are still ending which is essentially the explanation why the database directly story so far played out the way they did this was because well they could repeal to the directive but they wouldn't do too much the national loss then actually the loss would stay in place now V so you can say well but the you could also tell the Member States to repeal the national laws that were passed to implemented the records right obviously but the only situation where this would make sense is if the you would also say that he should appeal them and not pass anything alive essentially through enemies any legislation that would look like the protection that is abolished but that is a tricky thing because what you would have to say is essentially that you are as a member say not allows to create an accurate so sort of a negative legislation we don't have that it doesn't exist but if you will do that it would have to argue that it's actually harmful for the member states who have it and of course you have to provide evidence and as you know you could exercise a competence but it's subject to subsidiarity and proportionality so would active should bring the evidence that all the EU level it should be prohibited that this kind of protection should not exist on the national level and that's all had a lot of trouble to me and that's why I think it's actually unlikely that you would have a legislation that would sort of negatively prevent the member states from heaping protection in a particular area and that's why the tendency would be that actually you keep what you have perhaps you transform it as I'll get to it in a second okay but this is actually something that you are the first thing that's is sort of inherent in the federal model but it's not actually in the European model rules and regulations regulations speak to citizens directly so you don't happen to meet area of the state you can speak directly to the citizens so there's no implementation stage which means that if you remove the regulation you remove the underlying implementation now obviously that doesn't mean so obviously if there's a regulation as you can see here if there was ever ever any national law that might have conflicted with the regulation it's preempted right because it was European law saying something different so you is just gonna put best is even taller other cases now if you repeal the regulation obviously that law there was there will not be anymore pre-emptive because your key law is not anymore there so you don't necessarily remove the fragmentation but the important difference is that unlike in the situation of the regulation of the derivative the natural implementations that were created just because of this European law are not there so you essentially force the number six to come up with something and then you say not anymore need it but you didn't force it for repeal but with regulation on the other hand you tell that this is necessary we're doing directly that you remove it and then of course notice states can proactively come up with some policy but you can see that it requires action as opposed to in the directive Solari in action creates the fragmentation so that's a very different that's a very different set up so in this case obviously if you remove the regulation then the Member States can deviate and obviously if you want to prevent deviation yeah run into the same problem with competences as we have discussed just a while ago with the reference now regulations are usually perceived as a sort of a more sort of a bigger interference because you prescribe directly how it should look like as opposed to just say the direction but if you look at the policy making today directives are as restrictive as regulation so it's really just a matter of form very often but if you think about it well this tells you is that it would actually make a lot of sense if the evidence for on IPRA is we and if you nevertheless decide to experiment with new IP right that is untested that you should rather bring it to the market through the regulation then use directives from which you cannot scale back so easily so you use regulation and impose it through a regulation so these publishers right for instance if you go through the directive is it's the course election now it's very unlikely that would be removed because because even if the European identity will be removed the National these have to be introduced now to comply and then international member states would have to scale back if they want to remove it from the system and so you will have much more fragmentation because any moment to remind you they're two member states who did have some some form of publishers now interestingly enough there's an argument on competence to be made that regulations actually even required as a form of legislation in case you're dealing with a situation when there is little obstacle the national level so the little experimentation the national level so even really smooth the differences but you actually are rolling sort of a new policy there's an argument to be made that on competence you actually should be required to use use regulation because there's no defragmentation but i won't bore you with with that just if you interested you can look at airports speak to me later okay so the insight number one from this is what i call status corps inertia so essentially if you experiment and it's very questionable what the results will be you should really do it through regulations because what you risk if you do it through the directives as the case of database directive or maybe soon paris publishers right in the digits in the market is that the effective repeal of these laws will be prevented by the fact that it would be very hard to coordinate repeal the national level even if there is a political will both on the European level a national level to actually get rid of this can get rid of this right so the offices inside is if you are lobbies anyone to keep a right in the system go for directive instead of regulation because because you force the solution all the members say without unanimity and and will be very hard to get get from this not only because of this but also a second part that I will tell you in a second so this time score inertia is really interesting because you really have a trouble to coordinate appeal because of subsidy a and B also because of because of the way that things are legislated and because of the fact that to empty some form of IP rights on the national levels just for say is is something that is not easy easy to do okay but if you overcome this hurdle there is not one that is obviously we have legal safeguards for good reasons rule of law tells us that you know if someone promises you something for 50 years or 70 years after you die you know the legal system is here device to make sure that there are some sort of protection against the legislature completely changing its mind so if you want to see that in action you can think about the the standardized packaging cases so you might know that in the UK very recently there was a high-profile challenge against the law that is for in forcing to standardize packaging and one of the grounds of the complaint was that what standardized packaging of tobacco products is doing its depriving tobacco companies of their property that is their trademarks because it takes it away by essentially making it not very useful when you want to market your tobacco products so that we're trying to use IP rights the fundamental right to IP so human rights to property intellectual property to actually prevent the change which in this case was standardized faculty now that other Avenue where this is happening is invested in law which is long within the national system that is on the international system were the same argument about expert creationists taking place because if you prove expropriation in the international investment treaties then then then the states can be responsible to pay some damages for the logistic exchange to have introduced on the national level so changing your perspective on what IP rights should look like can trigger protection in law which means that the state will be obliged to pay you no money to Tucson right holders or it can trigger eternal most usual challenges as two fundamental rights and human rights to intellectual property and and and we can see that happening and this this is the first high-profile example as you might know in this particular case the tobacco companies were very successful and the reason for that is because judges did not sign with tobacco companies on the argument that they are deprived de facto deprived of their trademark so their argument was we are the de facto the title trademarks because we cannot use them directly on the products in a way we want and trademark law in their view should essentially guaranteed that possibility now the judges say well this is not necessarily the privation of property you can still use trademarks in other contexts what it is is a control of property which is sort of a less serious interference with property which has different treatment in the human rights law because it doesn't figure compensation in particular so that's where in this case the judges eventually clarified that this is just control of property which is very recently I think last week Court of Justice decided in a very similar case also saying it's just a control of property and there if it's not in this proportion that's completely justified but what you see is trajectory of using fundamental right to intellectual property as a way how to to undermine the autonomy of the legislature to to make it make it shows us now if you look at article 72 of the new chapter which is you know the source of this it doesn't say much it says intellectual property shall be protected and that's a car graph two and a quarter of one says something about protection off other types of property and in particular what it says is that in case you expropriate property then you should provide timely and fair compensation right so if you think about our comics you know getting rid of Rights the really two different scenarios that you can imagine so first in our you I mean look at this timeline here so first in re always there's a right that is granted today and will last fifteen years so it will expire in fifteen years so if I grant to the right if you create a work today and I'm going to repeal your right to let it work and I promise that we're 250 250 you will get it over to 15 years and the first repeal is after 15 years so if I say I'm repeal a any rights that would be there would arise from tomorrow this is today's last day when you get some form of protection in that case what you're dealing with this sort of a new promises so you just say well as of today I'm not giving any more protection numbers obviously that means that you have to tolerate in the system all the rights that were already granted today or before today so if the protection was 15 years you have to wait for 15 years until the last right will expire that's a long time if it's saying maple right that might be 70 years after the death of the author so that can be pretty long long period to wait so that's why the future-oriented repeals so the repeals that will happen only for future situations so a lot more promises is Rohrer it's run unlikely because it's all very useful you can do it essentially you're admitting that it's not too acute to remove IP right from your system because you're willing to tolerate it for quite some quite some time to come now what is more likely to happen is that you want to actually interfere in the system and you will just say well I know I have promised you for 15 years there's new sue Jenner's database trade but nevertheless unable to change my promise and I will this to end in two years so ice fact effectively you just gets evidence right so in this case you were shortened they're shutting your rights for some some period and obviously in this case you are interfering with your past promises so it's pretty clear that you will trigger protection through article 72 now the current situation is that when it comes to the future orient and repeals so just changing your mind for the future as you can imagine there is very little that the legislature is limited because it's changing just for for the future now what you have to keep in mind here is that there are international treaties you know international public well and my for serve as a Member States or as a as a state to actually have a particular arrest but when it comes to some rights they're not in the international public law necessarily so sue genders database where as an example where you could just abolish it and there will be no first forcing a different outcome on on the member states so what do you know if you overcome that in some countries there is an argument that certain essence of rights shouldn't be taken away by the legislature at all so in particular Germany is an example and then the concept of constitutional guarantee which essentially says princes for for-profit authors for corporate owners it says that certain core of Cochran law should be taken away by the legislature and has to be respected so irrespective so let us look at the broad margin hair it will structure carpet law but there's a certain essence there should it be capable now we need to only hear people either we don't have a case law really articulating that which doesn't mean that a court of justice cannot come up with that because you control upon cost or tradition of the Member States and Germany is not involved with and in doing this but if it does so I think what should happen is that we have differentiation because it's different to guarantee some core of copyright protection to authors and is different to guarantee a core if there should be any to database producers which is a pure investment protection so but we can I think assume that for the future or into the peel repeals really I think the legislature has rather open open field now for the pastoral repeals obviously article 17 - kicks in and that means that you have to make a case that what you're doing is in public interest and since you're repealing the right possibly compensate and I think here essentially had three strategies how you can approach this so the first strategy is you can say well I'll just wait as a legislature which is essentially saying I'm not cutting back on the promises that I made but I'm not promising anything new okay so as of today and won't be any rights but all those rights that were promised will expire as I promised in issue so that's the first strategy as I said I think it might work for instance for things like sue Jenna's database right with it doesn't seem to be evidence that is doing anything to the market so perhaps you're fine with repealing that right and keeping the rights that were promised upcoming 15 years and in 15 years it will expire but obviously there's acute need for change because you actually see that we introduced news publishers right and it's doing not that it doesn't do any benefit to the news publishers but is actually harming then perhaps what you want to do is to repeal immediately with very small transfer period but if you want to do that obviously you're repealing you're depriving of someone of property and in that case you have to compensate but compensating of course means that you have to design and you know allocate a budget and that's these are the scheming allocated budget which is not necessarily something that that is easy easy to do or governments are not really ready to do so if you are seeing what the most likely scenario is it is to actually use substitution instead so instead of really repealing repealing the rights you substitute them with something else so you repeal database protection and because we won't do the voice and obligates you to compensate you say I transformed this form of protection into something else and that's something else is either conceived as compensation or as conceived as preventing this to be seen as a form of expropriation but it's just a redesign of your right but in either case you can avoid compensation from being paid which then means that you have to think hard about how to redesign the right but that means that you don't necessarily remove the right part of the system you just keep it in your system and change the way the operates because you don't want to pay you're not prepared to pay the compensation of course unless you're not going to wait so in either case a time to is that I'm doing the choices that you have made in the past it's costly you need a case because obviously waiting means that you waste time and possibly here some opportunity cost if you compensate obviously you have to pay so that is costly too so so really that's why I think the middle ground is essentially substitution but then actually think about okay perhaps there will be some choices that I make there will be really hard to transform in something else that is that is very sensible so if you ask me on how sticky are the IP rights we're essentially get rid of electric you just transform anything else so you get a message if you think about how to repeal IP rights I think in reality the outcome is well yeah the situation in which you will repeal fully repeal is so unlikely because of the institutional setup and the safeguards that we have and if you were really courageous as legislature to do something you're more likely to transform it into something else more fitting to something else than to actually remove it from the system because it might be costly unless you willing to wait then I guess what really applies here is this typical cover of measure twice cut once and some people have these days curse three times so I think it's it's boils down to something as simple but it's very useful because if you pay it through the consequences like this it reminds you how important it is to think it through before you allow it into the system and how exactly you allow it into the system because it might be just very difficult to come back and if you just take a sort of a quick glance at the landscape of 19th century until today and think about how many different IP rights were repealed until today I cannot think of too many examples that really countries that really scale back on their IP choices and that's I'd like to thank you for attention look forward to your questions

 

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