Today the European Parliament passed with an overwhelming majority – 531 voting in favor, 11 against and 65 abstentions – a compromise proposal for a directive on certain permitted uses of orphan works. In Europe, orphan works are a much greater problem than, for example, in the USA, because European copyright has for a much longer time featured automatic protection. As a consequence, finding rights holders is more difficult than in the USA, where works had to be registered until the end of the 1980s. And due to ever-longer protection terms, the number of orphan works is going to increase even further every year, making access to our common cultural heritage increasingly difficult.

The so-called orphan works directive addresses the problem by allowing public-sector institutions such as libraries, museums, archives, educational establishments and film heritage institutions to digitize and publicize orphan works after conducting a “diligent search”. What constitutes a “diligant search” is outlined in more detail in a “Memorandum of Understanding on Diligent Search Guidelines for Orphan Works”.

One of the best provisions in the new directive is the principle of “mutual recognition” of diligent search, which means that the search needs to be conducted only in the Member State where the work was first published or broadcasted. In addition, the directive deals with the issue of partial orphans, which is of particular importance in the case of films with several rights holders:

Where a work has more than one rightholder, and at least one of the rightholders has not been identified, or even if identified, has not been located after a diligent search has been carried out and recorded in accordance with Article 3, that work shall be considered an orphan work insofar as the rights of the non-identified or non-located rightholders are concerned.

And in a last minute change, as is emphasized in the official press release, the MEPs inserted a provision, Art. 6 (2), that allows cultural heritage organizations to earn money as long as it is used for search and digitization:

At the insistence of MEPs, the text includes an article to allow public institutions to generate some revenue from the use of an orphan work (e.g. goods sold in a museum shop). All of this revenue would have to be used to pay for the search and the digitisation process.

However, the compromise also includes a highly problematic provision that was very controversial in negotiating the directive and that reads as follows:

Member States shall provide that a fair compensation is due to rightholders that put an end to the orphan work status of their works or other protected subject-matter for the use that has been made

The original proposal of the European Commission had not included such a right for “fair compensation”, which constitutes a risk for cultural heritage organizations engaging in digitization efforts. Because even though they invest in diligent search and in digitization they cannot be sure that rights holders don’t suddenly reappear and demand remuneration. Moreover, we have again a case of strategic ambiguity here (see also “ACTA as a Case of Strategic Ambiguity“). What constitutes a “fair compensation” is left entirely to the national legislatures. The ambiguity of the terms “fair compensation” allowed the passing of the directive because each side of the controversy could interpret it their own way.

It remains to be seen how national legislatures will implement this most important part of the directive. If the risk for heritage organizations is not contained it may render the whole directive toothless. The final version of the directive (see provisional edition) gives substantial leeway to the member states in that regard in Art. 6 (5):

Member States shall be free to determine the circumstances under which the payment of such compensation may be organised. The level of the compensation shall be determined, within the limits imposed by Union law, by the law of the Member State in which the organisation which uses the orphan work in question is established.

More details are given in the preamble to the directive, which is of course not binding for national legislatures:

For the purposes of determining the possible level of fair compensation, due account should be taken, inter alia, of Member States’ cultural promotion objectives, of the non-commercial nature of the use made by the organisations in question in order to achieve aims related to their public-interest missions, such as promoting learning and disseminating culture, and of the possible harm to rightsholders.

All in all, the orphan works directive is a step in the right direction and has the potential to really improve access to our cultural heritage – specifically to the “Missing 20th Century“. Whether this chance is actually taken now depends on how the national legislatures implement the directive over the next two years.

(leonhard)