OFCOM GUIDANCE ON PROTECTING UNDER 18s IN PROGRAMMES

Don’t draw a line under that list of new year resolutions. Broadcasters and programme makers may need to add a few if Ofcom’s new guidance on protecting the under 18s in programmes, published on 12 December, slipped under their radar at the close of 2007.

The new guidance supports the existing Ofcom Broadcasting Code rules with regard to protecting the under 18s and its real impact will be in the area of participation of under 18s in programmes (rules 1.26 and 1.27). Rule 1.26 requires due care to be taken over the physical and emotional welfare and dignity of participants under 18 and rule 1.27 states that under 18s must not be caused unnecessary distress or anxiety by their involvement in programmes or by their broadcast.

So what’s new in the guidance? The broad principles in rules 1.26 and 1.27 remain unchanged but the guidance is fairly prescriptive as to how broadcasters should ensure compliance, setting out a number of recommendations. These include (depending on genre and level of participation):

• Development of clear guidelines for production staff
• Appropriate background checks on participants’ social, family, health and educational circumstances and a thorough risk assessment
• Providing full information as to positive and negative consequences of participation to children ( in child-friendly language) and parents or guardians to ensure informed consent
• Seeking advice from an appropriately qualified professional e.g. child psychologist
• Ensuring a single point of contact to oversee the child’s welfare throughout production
• Careful consideration of the programme format and its likely impact on the participant.

Hopefully, broadcasters (and their suppliers) are already doing some of the above. However, they may well find that their existing procedures fall far short of what the new guidance requires.

What background checks are carried out on participants’ social, family, health and educational circumstances and how thorough do these need to be? How much information is currently given to participants under 18 (and their parents/guardians) about the negative and positive consequences of participation? Is there a single point of contact for all welfare issues? Should participants be allowed to view the edited programme prior to transmission? What procedures are there for monitoring consequences of participation post-transmission? These are just some of the questions broadcasters and programme makers need to be asking themselves. Most interestingly, the Ofcom guidance suggests that “springing high –impact surprises on under eighteens in “live” or “as live” programmes where conflict or highly emotional situations may be involved could cause harm and/or distress”. Is this a clear signal that participation in certain genres or formats will always be off-limits for under 18s irrespective of the robustness of the broadcaster’s policies and procedures?

Broadcasters and programme makers need to review the new guidance against their existing policies and procedures, identify any shortcomings and put in place measures to address them. This will be a time-consuming process and, given that the guidance is not legally binding, broadcasters may be tempted to ignore the recommendations. They will do so at their peril. The guidance will not just be relevant in determining any breach of the Broadcasting Code but is likely to be used by a court to determine whether reasonable care has been taken by a broadcaster in involving a participant in a programme. Will 2008 usher in the first action in negligence by a parent or former participant alleging harm and loss as a result of participation in a reality format?

This blog was first published on www.broadcastnow.co.uk in January 2008. Please note the above article reflects the Ofcom guidance as at January 2008 and has not been updated to reflect any subsequent additions or changes in the guidance.

IP LAW: THE GOWERS REVIEW Implementation Gives Way to Consultation

The Gowers Review of Intellectual Property, published in December 2006, made no fewer than 54 recommendations for reform of the UK’s framework for a successful IP system. If you’re thinking that these recommendations don’t impact on you and your clients, you could be wrong. The increasing importance of IP rights to the UK economy means that there are few businesses (law firms included) whose value does not depend to some degree on their ability to safeguard and exploit their IP rights and it is estimated that 70 per cent of a typical company’s value lies in its intangible assets, up from around 40 per cent in the early 1980s. So the likelihood is that at least some of the Review recommendations will affect you or your clients.

The Review envisaged a one to two year timeframe for implementation of the recommendations. As we approach the first anniversary, what progress has been made regarding implementation and what further developments can you expect before 2008?

Possibly the most visible of the measures taken so far to implement the Review has been the change of name of the Patent Office to the UK Intellectual Property Office (UK-IPO) with effect from 2 April (Recommendation 53). The Review considered that the former name did not reflect the broad range of functions undertaken in relation to all IP in the UK and created a perception that patents took priority over other forms of IP. The name UK-IPO will be an operating name until the necessary legislative changes can be made.

The Government has been somewhat slower off the starting blocks in implementing the other recommendations of the Review (with only six of the remaining 53 being completed so far).

The Review concentrated its recommendations in three key areas:

• strengthening enforcement of IP rights;

• reducing costs of registering and litigating IP rights (including better provision of IP information to UK businesses at home and abroad); and


• improving the balance and flexibility of IP rights to enable consumers to use material in ways that do not damage the interests of rights holders.

Strengthening enforcement of IP rights

With regard to enforcement of IP rights, most significant has been the bringing into force of section 107A of the Copyright, Designs and Patents Act 1988 with effect from 6 April 2007 (Recommendation 42). Formerly, Trading Standards had powers and duties to prevent the sale of trade mark protected goods but not to deal with copyright infringement, limiting its ability to deal with the counterfeiting of CDs and DVDs. Trading Standards now has responsibility for enforcement in relation to copyright infringement with the power to make test purchases, enter premises and inspect and seize goods and documents. The Government has allocated £5 million to fund enforcement of these new powers.

Other measures to implement the recommendations regarding enforcement include the recognition of IP crime as an area for police action as a component of organised crime in the updated National Community Safety Plan (Recommendation 41) and the launch in February 2007 of the UK-IPO Innovation Support Strategy including the pilot of an IP health check scheme for small businesses and new IP awareness initiatives. This implements Recommendation 35 that the former Patent Office should continue to raise public awareness of IP and the wider impact of IP crime. The Review concluded that consumer awareness of and respect for IP rights in the UK was relatively low with copying and counterfeiting being seen by many as “victimless crimes”.

Reducing IP Costs for Businesses

The launch of the UK-IPO Innovation Support Strategy also had the objective of implementing Recommendation 27 - to improve SME business support by establishing formal collaboration between the UK-IPO and Business Link and by conducting a pilot replicating the French “IP Genesis” Scheme. The latter offers a free IP audit to French SMEs who are not using the French IP system, especially the patent system.

The UK-IPO has signed an agreement with the Japan Patent Office to pilot a scheme (the Patent Prosecution Highway) that will improve the quality and efficiency of processing applications at both offices (Recommendation 19) and the European Patent Office has, based on the UK-IPO’s example, decided to pursue work sharing with the Japan Patent Office (Recommendation 18).

Improving the Balance and Flexibility of IP Rights

Recommendation 33 of the Review invited the Office of Fair Trading (OFT) to consider conducting a market survey into the UK collecting societies to ensure the needs of all stakeholders are being met.

Collecting societies license rights to use copyright protected music content to third parties on behalf of rights holders. In the UK these include Mechanical Copyright Protection Society/Performing Rights Society (MCPS/PRS) and Phonographic Performance Limited (PPL). Whilst acknowledging that collecting societies save licensees the time and cost of negotiating licences with individual rights holders the Review concluded that:

• the multiplicity of collection societies means that businesses are often required to obtain several licences to cover all the rights required e.g. anyone wishing to play music on business premises must purchase one licence from PRS for the rights in the music and lyrics and another from PPL for the rights in the sound recording. The Review felt that encouraging a cross-licensing agreement between collecting societies could benefit licensees and, if simplifying the process encouraged licensees to take up more licences, rights holders

• the exclusive licences taken by collection societies in the UK prevent members from making their work available free of charge (through the use of so-called Creative Commons licences) in contrast to the USA where, owing to antitrust regulations, collecting societies take a non-exclusive licence to their members’ works


• the absence of pan-European copyright licences require copyright licences to be negotiated for each state at increased cost.

Implementation of this recommendation has been in the letter rather than the spirit.
The UK-IPO has stated that “following a full review of the concerns put forward by Gowers, the OFT is able to report that it is provisionally of the view that such a study is not appropriate at this time.”

And implementation of the remaining 47 recommendations may well be characterised by a similar degree of caution. In early October the UK-IPO stated,

“In moving forward with the remainder of the recommendations, the Government needs to carefully consider the costs and benefits before proceeding with consultation on implementation of several of the recommendations. Therefore, in some cases, it is not going to be possible to implement recommendations within the one to two year timeframes suggested by Gowers.”

It is not altogether surprising, given the radical nature of some of the recommendations (particularly in the field of copyright law), that the UK-IPO has determined to consult with stakeholders before rushing to implementation. In early October the UK-IPO released a consultation document on fast track services for patents and trade marks. Consultations on copyright exceptions (including the recommended exception for the purposes of caricature, parody or pastiche), fees and the research exemption in the Patents Act can be expected before the end of the year. Rights holders and users alike (and those who advise them) should not lose the opportunity to respond.




This article was first published in The Law Society Gazette in November 2007 and reflects the legal position at that time.

COPYRIGHT, MUSIC AND EXEMPTION

A government review of copyright exemptions for playing of recorded music may force some not -for-profit bodies to turn off the TV, radio or CD player.

They and charitable bodies may soon decide that silence is golden if the repeal of current exemptions means they will have to cross the palm of Phonographic Performance Limited (PPL) with silver before they can play recorded music in public.

The Intellectual Property Office (UK-IPO), formerly the Patent Office, closed its Consultation on Changes to Exemptions from Public Performance Rights in Sound Recordings and Performers’ Rights on 31 October. If not-for-profit bodies or rightsholders (and their advisers) missed the deadline for responding, there may still be a chance to have a say- the UK-IPO proposes to hold a series of meetings on the issue later this year in its offices in Newport, Wales and London with meetings in Scotland and Northern Ireland also a possibility.

Currently, anyone who wants to play or perform a recording of music in public must first obtain a licence to do so, unless an exemption applies. Public playing and performance covers virtually all playing of recordings outside a domestic setting.

A recording of music will contain a number of copyright works. There will be copyright in the music itself (as a musical work - first owned by the composer), copyright in any lyrics (protected as a literary work- first owned by the lyricist) and copyright in the sound recording (first owned by the producer,usually a record company)). In addition the musicians and vocalists who performed on the recording will have performance rights in the recording.

Copyright owners have the exclusive right to play or perform their copyright works in public. Therefore, anyone wishing to play or perform a substantial part of a copyright work in public must obtain the consent or licence of the copyright owners unless one of the statutory exemptions set out in the Copyright, Designs and Patents Act 1988 (CDPA) applies.

It would clearly be inconvenient for both the owners of copyright works and those wishing to license their use if licences had to be negotiated on an individual basis, so organisations have been set up to administer licences and collect income on behalf of the copyright owners. In the UK, PPL administers licences and collects income for the playing and performance of sound recordings and performances and the Performing Right Society (PRS) administers licences and collects income for the playing and performance of the music and lyrics embodied in the sound recording.

The practical effect of this is that anyone who wants to play recorded music in public will need to obtain a licence from PPL and the PRS unless an exemption applies.

Not-for-profits that profit

Currently, charitable and not-for-profit bodies benefit from an exemption to obtain a licence from PPL in respect of their use of recorded music (though they are still required to obtain a licence from PRS).


Section 67 of the CDPA is available to a club, society or other organisation if that organisation is not established or conducted for profit and its main objects are charitable or otherwise concerned with the advancement of religion, education or social welfare subject to certain qualifications. Any profits from the use of the music must be used for the benefit of the organisation and the person playing the recorded music must not derive commercial benefit from doing so.

Section 72 applies where a broadcast which contains a sound recording is played in public in a location where no admission has been charged for entry. Broadly, where the broadcast contains recordings of music this exemption is only available where the use forms “part of the activities” of the not-for-profit organisation. The example given in the consultation is of an NHS hospital which has a television or radio playing in a day room for the benefit of patients.

Corresponding exemptions in relation to performers’ rights are set out in paragraphs 15 and 18 (1)(A)(a) of Schedule 2 to the CDPA.

Copyright law seeks to strike a balance between the interests of rights holders and society at large (the rights users). It seeks to encourage and reward creativity by allowing copyright owners to exercise exclusive rights in their works for a limited period of time (currently 70 years from the death of the author for music and lyrics:for sound recordings, 50 years from the making of the recording). However, public policy dictates that in return for these exclusive rights access to copyright works should be permitted for certain socially desirable purposes.

The consultation states that PPL has argued that its members are entitled to remuneration from organisations currently exempt from paying licence fees and that the exemptions are in breach of article 8 (2) of the Rental and Lending Directive (which requires member states to provide a right to equitable remuneration for copyright owners of sound recordings and performers when commercially produced sound recordings are communicated to the public). To date the government has taken the view that the exemptions (as amended over time) are permissible under the exceptions permitted under the directive.

Conversely, some small organisations find it difficult to comprehend why they are obliged to obtain licences from PRS and/or PPL for the very limited use they make of music.

New Proposals

The UK-IPO is seeking comments on the following three options:

1. Repealing the exemptions so that charitable bodies and not-for-profit organisations would need to apply for a PPL licence as well as a PRS licence for the playing or performing of sound recordings in public;
2. Narrowing the scope of the exemptions so that they are only available to small charities (the proposal is to define small charities as those whose turnover is less than £20,000 a year) but at the same time extending the scope of the exemptions so that they apply to PRS licences as well as PPL licences;
3. Repealing the exemptions and providing that use should be subject to the payment of “equitable remuneration”. This differs from option1 in that sums due in respect of a right to equitable remuneration are likely to be lower than the licence fees which can be demanded from a copyright owner who has exclusive rights. Another distinction is that a rights holder with a right to equitable remuneration rather than an exclusive right may not refuse to licence rights though in practice it is difficult to think of many situations in which a licence would be refused by an exclusive rightsholder.

Winners and Losers

It is clear that PPL, its record company members and musicians and vocalists stand to be the winners from any changes in the law. All of the three options above mean that PPL will be able to collect income from licensing uses which are currently exempt.

Whether option 1 or option 3 is adopted, charitable and not-for-profit bodies will find themselves having to pay PPL as well as PRS for the use of music. And while option 3 holds the promise of potentially lower fees the question of what will constitute equitable remuneration is likely to raise more problems than it will solve. Those seeking to licence rights need to have certainty as to the fees which will be payable. Given that one of the objects of this exercise is to remove the anomaly between the treatment of copyright in recordings and copyright in the underlying music and lyrics it seems odd that option 3 seeks to address this by providing for a lesser right (to equitable remuneration) in respect of sound recordings than the exclusive rights conferred on the copyright owners of the music and lyrics embodied in them.

Option 2 provides a window of opportunity for small charities to free themselves from the cost and administrative burden of obtaining licences from PRS or PPL, and would clearly benefit those who currently obtain a PRS licence at the expense of the larger charities. For this very reason it is unlikely to be popular with PRS.

Maintaining the status quo is, interestingly, not listed as an option. It may seem inconsistent that exemptions are permitted for sound recordings where they do not apply to the music and lyrics embodied in them but when you consider that PPL represents the interests of the major record labels whereas PRS collects income on behalf of composers/songwriters it is not difficult to understand why, in economic terms, the exemptions could be justified with regard to PPL. However, the exemptions in respect of performers’ rights which are administered by the PPL are difficult to justify in those terms – might it have been possible to maintain the status quo whilst providing for a right of equitable remuneration for performers? This may be less costly but would still involve a payment to PPL which collects the income on behalf of performers.

Will the youth club's radio be switched off? Will the church playgroup have to manage without its CDs? One thing is sure – charities and not-for-profit bodies and rights holders alike should not lose the chance to have their say.

Pamela Forte manages media and entertainment law boutique practice, Forte Law, has lectured on copyright and music industry contracts at Newport College of Art, Media and Design and is a member of The Voting Academy for the Brit Awards 2009.

This article was first published in The Law Society Gazette in November 2008 and reflects law and policy at that time.

ADVANCE WARNING

So you’ve just come back from your skirmishes in the bunker at MIPCOM with that distribution advance. When you’ve told all your disbelieving colleagues how tough it is partying with the rest of the TV industry in Cannes in October, you can relax. All you need to do is sign the distribution agreement and you can get on with the production, right?

Wrong – this is where you need to raise your game and make sure that 10 years down the line that distribution agreement doesn’t cause you an even bigger headache than that one last drink at the final night party.

Here are my top ten tips for negotiating your distribution agreement:

1. Territory. Make sure the territory is clearly defined. Avoid accepting generic definitions like “the US, its territories and possessions”. Ask for a list of the territories included within the definition to append to the agreement. Otherwise, you could unknowingly licence rights in the same territory to someone else. Do you need to do a “throughout the world” deal or can you keep some territories back?

2. Rights. Media and languages should be clearly specified and defined. If you cannot be clear from the agreement exactly what rights you are licensing there is something wrong with the drafting.

3. Term. Negotiate the shortest term you can. Ensure that for agreements for a longer term there are clearly defined performance targets and a mechanism for early termination in the event that targets are not met. Remember that vaguely worded obligations to use reasonable endeavours to maximise receipts are difficult to enforce.

4. Conflicts. Make sure that the above 3 don’t conflict with the rights you have already agreed to grant to other financiers and that any holdbacks in favour of broadcasters are reflected in the distribution agreement. The cross-territorial nature of new media can easily give rise to conflicts of rights.

5. Licence v Assignment. Rights should be licensed (i.e. permitted to be used for a specified period) rather than assigned (where ownership is transferred). Be cautious about language which refers to assignment or executing assignments. If you are required to execute a document to be filed with the US copyright registry be clear as to the effect of this and any mechanism for modifying/removing any entry or, if rights have been assigned, obtaining a re-assignment of rights, on expiry or termination of the distribution agreement.

6. Termination Provisions. There should be some! Make sure that you have the right to terminate for breach of any of the distributor’s obligations and warranties (again, there should be some apart from paying the advance!), for any event of insolvency in any jurisdiction (particularly important in the current climate) and failure to meet those performance targets you included earlier.

7. Receipts, Commission and Distribution Expenses. You will want to make sure that you are happy with the commission rates and that they include all commissions payable to sub-distributors, agents etc. (no double-dipping). Run through that Distribution Expenses definition with a fine tooth-comb and cap them overall at 5% of Gross Receipts.

8. Payment of Distribution Advance. Make sure there is sufficient certainty regarding payment dates and that the delivery requirements don’t allow a distributor to reject the programme/film on arbitrary grounds (increasingly important in the uncertain economic climate).

9. Accounting provisions. These often come near the end of the agreement. Don’t flag now! You need to work out exactly when you will receive your monies following their receipt by the distributor. Go for accounting within 30 days of each 3 month period if you can. Make sure the agreement provides for regular accounting statements setting out all the information you will need to make sure you get what’s due to you. There should be provision for interest on late payments and the right to inspect and audit the books (at the distributor’s expense if the inspection reveals an underpayment.)

10. Finally. If you can afford it, get yourself a lawyer who will review your distribution agreement for you. Many lawyers will be able to quote you a fixed fee for reviewing/amending a distribution agreement. When the distribution advance is a distant memory and your cherished programme is sharing the fate of the ark of the covenant at the end of the first Indiana Jones film you might even think it was value for money!

(c) Forte Law 2008

The above article was first published on broadcastnow.co.uk in October 2008. The above tips are general guidelines and should not be regarded as a substitute for legal advice on any particular agreement.