The 60-year Copyright Levies saga: High time for reform

Executive summary

Originally introduced on blank media like cassette tapes to compensate artists for private copying, copyright levies have ballooned into a complex and outdated system applied to most electronic devices. They stifle the single market and unfairly tax consumers. Whilst fair compensation for creators and a thriving cultural sector are essential, the current levy system is ineffective and urgently requires profound
reform.

The vastly different national systems across the EU discourage cross-border trade, distort prices and availability, and impose a huge administrative burden on businesses. The attempted expansion of levies to cloud services, refurbished products and offline downloads from streaming services only worsens the problem.

With private copying drastically declining, it is crucial to shift to alternative models that can benefit consumers, Europe’s digital transformation and rightsholders alike. These models should be technologically neutral, avoid market distortion and reduce administrative burden.

We propose a collaborative exploration of fairer, more efficient solutions. These could include:

• State budget model: Following Finland’s example, device-based levies could be replaced with a state fund managed by an advisory board, ensuring fair compensation with reduced administrative costs.
• Direct licensing model: The private copy exemption could be abolished in favour of direct payments per copy, supported by blockchain technology for transparency and reduced unauthorised usage.
• Household cultural contribution: Contributions could be linked to the potential use of devices in households rather than individual ownership, simplifying administration and allowing exemptions for hardship cases.
• Fee on cultural works at the point of sale: Funding could be aligned with the consumption of copyrighted content, ensuring proportional contributions.

DIGITALEUROPE is committed to finding a long-term solution, including transitional funding models during the shift from device based levies. We welcome discussions with all stakeholders to create a system fit for the digital age.