Address by Frédéric Mitterrand, Minister of Culture and Communication, on the occasion of the examination of the bill on remuneration for private copying.

For more than 25 years, following the Lang law of July 3, 1985, private copying has contributed to the financing of a capital part of French artistic creation, for an amount that amounted in 2010 to approximately €189 million.

Although 75% of these amounts directly benefit creators, the remainder, or 25% of the remuneration for private copying, is obligatory, under the 1985 Act, to be devoted to measures to assist the creation, distribution and training of live performers.

As a result, the public contributes directly to the funding of nearly 5,000 cultural events in a wide variety of genres and repertoires, including large and small festivals, plays, concerts, street shows, and short courses.films, creative documentaries, etc.

This remarkable institution is now under threat, notably following a «Padawan» decision handed down on 21 October 2010 by the Court of Justice of the European Union (CJEU), which the Council of State was obliged to implement in a decision of 17 June 2010.

In a technical sense, this bill responds to a simple and limited issue that we all understand, however, how imperative it is to avoid, in the very short term, the collapse of a system so essential for the fair remuneration of authors, performers and producers of music, cinema, audiovisual, still image and writing, and for the vitality of French artistic creation.

In this context, I welcome the particularly constructive work and discussions on this text, both during its very consensual examination in the National Assembly and more recently here in the Committee on Culture, education and communication. In this respect, I thank the rapporteur for the very precise and thorough work he has done despite the urgency which has compelled us.

The primary purpose of this bill, ladies and gentlemen senators, is therefore to secure the mechanism of private copying, following the June 17 decision of the Council of State.

Considering that the media acquired for professional use should be exempted from the payment of remuneration for private copying, the Council of State condemned the system put in place by the private copying committee, which consisted in: for reasons of simplicity and prevention of fraud, to apply remuneration for copying to media that can be used both for professional use and for private copying (CD-ROM, most DVDs, multimedia phones, USB key, etc.), subject to a reduction reflecting the share of professional usage.

This decision has very serious collateral effects because it deprives, in particular, of legal basis, as of 22 December next, most of the scales for collecting private copying, and thus poses an immediate threat to the perception of this 180 million euros.

In addition, the decision of the Council of State brings a deadweight effect for the persons responsible for the remuneration for private copying who had initiated a legal action before 17 June 2011: they could claim the reimbursement of all the sums paid, or an amount of nearly 60 million euros, even though most of these sums were actually due when the media acquired for professional purposes were not in question and the private copy was passed on to the price paid by consumers.

The bill thus makes it possible to remedy the risk of an interruption or a questioning of the remuneration for private copying when it is actually due, by neutralizing the collateral effects of the decision of the Council of State:

On the one hand, by maintaining, beyond 22 December next, the scales of remuneration for private copying, and this until the adoption by the Commission private copying of new scales relating to the media in question in Decision No. 11 annulled by the Council of State, within a maximum period, however, which the National Assembly, with the agreement of the Government, has reduced to one year;

On the other hand, by carrying out a targeted validation of the remuneration before 17 June 2011 that is the subject of a contentious action.

This answer - I insist on it - is consistent with the Constitution and European law, and was therefore approved by the Council of State during the examination of the bill. In particular, designed to respect res judicata, it does not prevent persons who have acquired a medium for professional use from asserting their rights, because it concerns only remuneration which is not covered by the ground on which the decision to annul the Council of State is based, in particular by preventing it from being contested because of a lack of legal basis.

I would add that the bill, which responds to obvious reasons of general interest in support of creation and cultural diversity, is in fact indispensable to comply with our legal obligations under Community law, the Court of Justice of the European Union (ECJ) having in fact enshrined the principle of an obligation to compensate effectively for the shortfall related to private copying acts.

In order to implement the decision of the Council of State, the bill also provides for the exemption of material acquired for professional use from the payment of remuneration for private copying, in two ways: directly inspired by the commission’s current practice concerning certain media already exempted from remuneration: either on the basis of an agreement between Copie France and the professionals, which will allow them-to be exempt from remuneration for private copying when acquiring media, particularly in specialized distribution channels; by a request for reimbursement submitted to Copie France and accompanied by supporting documents establishing the professional status and the presumed use of the medium for purposes other than private copying.

There are other provisions in the bill that are more limited in scope, but they are nonetheless useful clarifications.

It thus enshrines the Commission’s practice of private copying in the field of consumer investigations.

It also draws the consequences of another decision of the Council of State, dated 11 July 2008, according to which the remuneration for private copying is not intended to compensate for the loss of income related to illicit copies of protected works, thus excluding from the basis of private copying illicit source copies made from pirated files.

The bill was amended on this point in the National Assembly – at the initiative of MP Tardy – in a way that should not be open to misunderstanding. By inserting the same clarification, relating to copies from illicit sources, in other articles of the Intellectual Property Code relating to the definition of the exception for private copying, this technical amendment, of pure coordination, does not change the scope of the exception for private copying from the original government text: since copies of illicit sources are not on the basis of the remuneration for private copying, it is clear - both under national law and under Community law - that these copies are not covered by the exception for private copying.

The bill also provides for the information of the acquirer of a recording medium concerning the amount of remuneration for private copying to which it is subject, This represents an interesting step forward for everyone’s understanding of the private copying mechanism and its issues.

In light of the technical issues raised by this provision, I would like to point out that the government will ensure that its regulatory implementation is as flexible and pragmatic as possible.

Senators, you have understood that, in the face of a situation of extreme urgency, this bill favours a pragmatic, immediately applicable response, and respectful of the jurisprudence of the Council of State and the Court of Justice of the European Union.

Beyond this short-term response, my department has undertaken a more global, more ambitious reflection - which we all hope for - on the impact of technological developments on the mechanism of private copying. This reflection will allow us to address all the often legitimate questions raised by the future of this method of remuneration for creation. This reflection is conducted in particular within the framework of a specialized commission of the Conseil supérieur de la propriété littéraire et artistique, chaired by Sylvie Hubac, who was tasked with studying the impact of “cloud information”, also known as “cloud computing”. on remuneration for private copying.

Honourable senators, because it is the legacy of a founding law, which our predecessors were able to unanimously pass, because it is our collective responsibility to create, I hope that we can reach the most consensual possible adoption of this essential law, which is above all an emergency law. This will once again be a sign of our responsiveness, of our common commitment to defending those who invent, those who compose, those who create.

Thank you.