Selling Rights

Lynette Owen

• Publisher: Routledge
• Year: 2019
• ISBN:
  9781351037488
• Edition: 8
• Topic: Business
• Subtopic: Industria dei media e delle comunicazioni
• Index: Business

Selling Rights has firmly established itself as the leading guide to all aspects of rights sales and co-publications throughout the world. The eighth edition is substantially updated to illustrate the changes in rights in relation to new technologies and legal developments in the UK and the rest of the world.

This fully revised and updated edition includes:

• coverage of the full range of potential rights, from English-language territorial rights through to serial rights, permissions, rights for the reading-impaired, translation rights, dramatization and documentary rights, electronic and multimedia rights;

• more detailed coverage of Open Access;

• the aftermath of recent reviews and revisions to copyright in the UK and elsewhere;

• updated coverage of book fairs;

• a major update of the chapter on audio rights;

• an updated chapter on collective licensing via reproduction rights organizations;

• the impact of new electronic hardware (e-readers, tablets, smartphones);

• the distinction between sales and licences;

• the rights implications of acquisitions, mergers and disposals;

• updates on serial rights;

• new appendices listing countries belonging to the international copyright conventions and absentee countries.

Selling Rights is an essential reference tool and an accessible and illuminating guide to current and future issues for rights professionals and students of publishing.

Chapter 1

Rights

The historical and legal background

This introductory chapter aims to set the scene for what follows by tracing the history of how the concept of copyright arose, some of the different copyright philosophies (including those of the UK and its major trading partners), and, in particular, the flurry of initiatives in recent years proposing copyright reform at international, multinational and national levels. To trade in intellectual property (IP), it is essential that the work in question is protected by copyright and that a framework of mutual copyright protection is in place if the trading is to take place between different countries, perhaps with differing copyright regimes.

The rise of the UK publishing industry

In the UK, the publishing industry can be held to have been born when the University of Cambridge received a Royal Charter to print in 1534, followed by the University of Oxford in 1586. The first commercial publishing house was the family firm of Longman, founded in 1724, but the real burgeoning of the commercial houses, many of which still exist today under the umbrella of larger organizations, took place in the nineteenth century. This was the result of a variety of factors: an increase in population, the concentration of population in cities and the development of literacy. The latter part of the twentieth century saw a movement towards the consolidation of many formerly independent small and medium-sized publishing companies into larger groups, some of them part of multinational media corporations. The publishing cycle continues with the founding of more small independent publishing houses.

Copyright

The publishing industry – and by association the trade in publishing rights – is inextricably linked to the existence and recognition of copyright. Without the bedrock of copyright, it is doubtful whether many authors would have the incentive to be creative. Some authors may still be prepared to publish without reward, perhaps in order to make known the findings of their academic research and as a means of furthering their professional careers, and indeed the pervasive influence of the internet has led many would-be authors to post their writings online, and to self-publish, with varying standards of quality resulting. Others have chosen to become authors in an attempt to earn their living directly from their writing. Without copyright and the laws and systems that underpin it, there would be total freedom for literary works to be reproduced, translated, adapted and exploited in a variety of ways without any obligation to recognize the interests of the creator. For authors, this would affect both their moral rights – the right to be recognized as the creator of the work and the right to prevent derogatory changes to the work (rights that are separate from although linked to copyright) – and their economic rights, the right to receive a fair reward for the use of their work by others. As Dr Johnson (an early Longman author) remarked, ‘No man but a blockhead ever wrote except for money.’

From the 1990s onwards, there has been extraordinary activity on the copyright front, largely as a result of the development of the digital environment, the rapid growth of the internet as a global force, the influence of the ‘big tech’ companies and the expectations of users. At the time of writing, it is estimated that there are over 4 billion internet users worldwide, equivalent to about 54 per cent of the total world population.

Many factions have questioned whether copyright is still fit for purpose in the digital age; the more vocal activists view it as a barrier designed by the creative industries to block access to content. There have been ongoing national and international forums and conferences within the copyright industries, dialogue with players from other industries entering the field (most prominently the so-called ‘digital disruptors’ of Silicon Valley), changes and proposed changes to national and international legislation and treaties and a number of high-profile court actions, all seeking to ensure the protection of content as radical changes were taking place in methods of delivery of that content. There remains a need to maintain the delicate balance between copyright protection and user access, with the requirements of the academic community a particular area of concern to the book and journal industry. The concept of copyright has never had a higher profile, both within the industry and at national and international governmental levels; it is under both scrutiny and attack as to its relevance in the digital world.

What is copyright?

Copyright is a form of intellectual property (IP); other categories of IP now include patent, trademark and design rights. Perhaps not surprisingly (although ironically in the light of the later copyright history of that country), copyright is first identified as a concept in China during the Song Dynasty (960–1279) when the imperial court issued an order banning the making of unauthorized printing blocks for reproduction purposes. A scroll printed during the Southern Song Dynasty (1127–1279) carries a notice specifying that reproduction is forbidden and that the printer had registered the work with the appropriate authorities.

In the Anglo-Saxon common-law tradition, copyright is classified as a property right, which can be sold, assigned, licensed, given away or bequeathed. The countries of continental Europe, with their civil-law tradition, follow a different philosophy, that of droit d’auteur (the author’s right), which is perceived as a human right; it places far more emphasis on the rights of the creator and limits the rights which can be transferred to others such as employers or authorized users such as publishers. It is not the purpose of this book to provide comprehensive coverage of the increasingly complex area of IP rights (more detailed sources of information are listed at the front of this book in ‘Acknowledgements and further reading’) and indeed some would contest that copyright is a property right, classing it instead as a regulatory system created by governments (a view expressed by William Patry in his Moral Panics and the Copyright Wars). However, it is vital that those directly involved in the licensing of rights should have a basic understanding of the concepts of copyright; they should also be aware of the different philosophies and terms of protection that prevail from country to country, and of the significant changes to legislation that are necessary to ensure continuing protection during a period of continuing and radical technological changes.

Copyright provides protection for what are often termed ‘works of the mind’; it covers not only original literary works but many other creative works, including music, recordings, films, art, sculpture and photography, as well as works in digital form such as computer programs and databases. The exact significance of the term ‘literary work’ may vary slightly from country to country, depending on the exact definition under domestic copyright law; in the UK it includes any original work in written form, including computer programs, compilations and certain types of database.

Copyright has both positive and negative aspects in terms of the power of control it conveys. Ownership of copyright in a work enables the owner to authorize other parties to make use of the work in agreed forms, often through licensing arrangements. Such use is subject to appropriate acknowledgement to the owner and is usually on the basis of suitable financial recompense to the owner. Alternatively, copyright owners may choose not to authorize a particular exploitation of the work if they feel that such use would be inappropriate or detrimental to the nature or commercial value of the work. Infringement of copyright through unauthorized use is almost always an infringement of statutory rights and may also be a punishable offence, which may be dealt with under civil or criminal law according to the nature of the infringement and local legislation in the country concerned. In most cases, the first owner of copyright in a literary work is the author. An important exception to this, specified in the copyright legislation of countries following the Anglo-Saxon tradition, is when a work is created in the normal course of the author’s employment duties. Hence, full-time staff writers employed on composite works, such as encyclopaedias and dictionaries, do not normally retain copyright in what they produce; scientists employed by a pharmaceutical company do not usually control copyright in their research findings. In the USA, copyright in works ‘made for hire’ (i.e. works prepared by employees as part of their normal duties, or where the writer and the commissioning party have reached agreement on this basis) belongs to the commissioning party.

This is not the case in countries following the droit d’auteur tradition, where ownership of copyright is normally retained by the individual creator, but with the employer having an exclusive right to exploit the employee’s work, perhaps for a certain number of years.

In countries following the Anglo-Saxon common-law tradition of copyright, the author, as the usual first owner of copyright in a work, will usually decide whether to retain ownership or whether to assign copyright at the point when a contract is negotiated with a publisher. It is common practice in trade publishing (books designed for readership by the general public) that authors retain ownership of copyright in their own name and grant to their publishers exclusive licences to publish their books in designated forms and media for a designated period of time in a designated geographical market. In addition to these primary publishing rights, other subsidiary rights may be granted to the publisher for exploitation within the agreed markets.

In educational and academic publishing, it is more common for the author to assign ownership of the copyright to the publishing house for the full term of copyright, while continuing to receive payment for sales and other exploitation of the work; provision is usually made for the author to recover the copyright if the book is allowed to become completely unavailable in any format and if no valid sub-licences are extant. The main reasons for copyright to be assigned in such cases will be covered in Chapter 2.

The duration of copyright protection varies from country to country and is covered by the domestic copyright legislation of the country concerned. In the case of the UK, literary works were long protected for the lifetime of the author and for a further period of fifty years from the end of the year in which the author died. As from 1 January 1996, this period was amended to seventy years post mortem auctoris, following UK implementation of a EU directive aimed at harmonizing the period of protection in the member states of the European Economic Area (see ‘Copyright legislation in the United Kingdom’ later in this chapter). The USA also extended its period of protection for works created on or after 1 January 1978 to seventy years post mortem auctoris (see ‘Copyright legislation in the USA’ later in this chapter). However, at the time of writing, many countries (including a number of highly developed countries) still have shorter terms of protection (including Canada and Japan, yet to extend from fifty to seventy years in line with Trans Pacific Partnership discussions), so one can never assume that there is a totally level playing field.

As the publishing industry has developed, a whole sector of publishing activity has grown up whose sole aim is to explore all the potential copyright possibilities of a book and to make licensing arrangements for those rights to be exploited as widely as possible so that the book can reach a wider audience – in the original language wherever that language can be read, translated into other languages or made available in other forms through media other than the printed page. It is this aspect of the publishing business that this book aims to cover.

The international copyright conventions

In 1886, the Berne Convention was established as a multilateral copyright treaty. Its aim was to establish minimum standards of copyright protection that would be complied with in the domestic copyright legislation of its member states. Its main features are that no formal procedures (such as registration) are required in order to secure copyright in a work, and that for the majority of creative works the minimum term of copyright protection is the lifetime of the author plus fifty years. At that time, the provisions of domestic copyright legislation in the USA, which had a shorter term of protection and included a requirement for a formal copyright registration procedure, made that country ineligible to join Berne. The convention is administered by the World Intellectual Property Organization (WIPO), based in Geneva; it sponsors World IP Day annually on April 26th.

In 1952, the Universal Copyright Convention (UCC) was established; its main features are a provision to allow for formal procedures such as registration, a minimum copyright protection period of the lifetime of the author plus twenty-five years, and a provision that every work will be regarded as complying with registration formalities if it carries the UCC copyright symbol ©, the name of the copyright holder and the year of first publication. The convention is administered by the United Nations Educational, Scientific and Cultural Organization (UNESCO), based in Paris.

A further significant development of relevance to rights-dealing was the introduction in 1971 of the Paris Revisions to the texts of both the Berne Convention and the UCC. These revisions were introduced at the request of the developing countries, which felt that they did not have sufficient access on reasonable terms to rights in educational and academic works published in the more affluent countries. The provisions of Paris set out procedures whereby publishers in developing countries that have ratified the Paris text of the appropriate convention may apply for compulsory translation or reprint licences in essential books of this kind if they are unable to make contact with the copyright owner, or if they are refused a licence without adequate reason. Not all countries have ratified the Paris text of the two conventions; the UK ratified the Paris text of the UCC on 10 July 1974, and that of Berne only on 2 January 1990. It is an undoubted fact that more voluntary licences have been granted to publishers in the developing countries since the introduction of these provisions, if only to forestall the granting of compulsory licences by local authorities. This aspect of licensing will be covered in more detail in Chapters 12 and 16. At the time of writing, the Berne Convention has 176 member states and the UCC 100: of these, ninety-eight states belong to both conventions.

The USA acceded to the UCC on its inception in 1952 and thus for the first time gave formal copyright recognition to the copyright works of other member states, although the UK did not accede until 1957. The USA revised its copyright procedures in 1988 to enable it to comply with the requirements of the Berne Convention; its membership of Berne took effect on 1 March 1989.

It is therefore only comparatively recently that mutual copyright recognition has been in force between the two largest producers of English-language books in the world. Many British authors, including Charles Dickens, found that their works were being published in this major English-speaking overseas market without permission or payment, since their books were considered to be in the public domain. The transatlantic traffic in unauthorized editions was not entirely one way: American authors such as Mark Twain were published without permission in Britain. On the other hand, there is much evidence of reputable American publishers negotiating for rights in British books and making payment for licences when there was technically no legal obligation for them to do so. Much of Virginia Woolf’s business correspondence is concerned with arrangements for American editions not only of her own books but of those of other authors published by the Hogarth Press, which she and her husband had founded.

The entry of other countries with major publishing industries into the international copyright fold was even more recent; the then Soviet Union joined the UCC only on 27 May 1973, before which it had both translated and reprinted foreign works on a large scale.

The People’s Republic of China acceded to the Berne Convention on 15 October 1992, and to the UCC on 30 October 1992, after many years of utilizing foreign works on a vast scale, usually without permission or payment; Vietnam, which has also made liberal use of foreign works, joined the Berne Convention as recently as October 2004. Even now, membership of an international copyright convention does not necessarily operate retrospectively. When Russia acceded to the Berne Convention on 13 March 1995, it was with the proviso that foreign works first published before 27 May 1973 (the date of the Soviet Union’s accession to the UCC) would remain in the public domain in Russia, a contentious proviso that was only withdrawn as recently as 31 January 2013. Countries may also seek to impose reservations when joining; when Saudi Arabia joined the Berne Convention in February 2004, it did so with a general reservation on copyright protection for works ‘contrary to Islamic law’, a condition generally considered incompatible with Berne.

There had long been a need to update the Berne Convention, the stronger of the two conventions, in order to take into account the copyright implications of the digital environment. Following a number of meetings of the Committees of Experts on the Berne Protocol and New Instrument, a diplomatic conference of delegates from 160 countries was held on 2–20 December 1996 in Geneva under the auspices of WIPO with a brief to discuss ‘certain copyright and neighbouring rights questions’ aimed at strengthening the provisions of Berne, and in particular to take into account the impact of the new technologies. The IP industries and creative organizations were represented at the conference, as were the hardware manufacturers and ‘passive carriers’ such as the telecommunication industries and internet service providers (ISPs).

Topics included whether acts such as digitization, temporary storage and ephemeral display should be included as part of the reproduction right; also discussed was the possibility of introducing a telecommunication right, and the question of whether there can be any ‘fair use’ exceptions to the use of copyright material in the electronic environment when the distinction between communication to public and private users is no longer realistic in the context of the internet. Other topics included a proposal for a sui generis right for databases (stemming from the 1998 EU Database Directive) and the need to prohibit encryption-breaking devices designed to circumvent electronic coding devices employed by copyright owners to protect their property.

On 20 December 1996, the conference adopted two new treaties: the WIPO Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT). The WCT contains a number of key points. Rightsholders have a new exclusive right of communication to the public, which includes communication by digital means. Regrettably, the Treaty did not include revised wording on the right of reproduction, but the conference endorsed a statement from the USA that Article 9 of the Berne Convention on the right of reproduction should be held to apply in the digital environment. A right of distribution is included in the Treaty, although this is limited to works in tangible form and allows contracting states to deal individually with the question of international exhaustion (for more detail, see ‘Territorial rights and parallel importation’ in Chapter 9). The Treaty also permits each contracting state to provide for limitations and exceptions to the rights of reproduction, provided that these meet the requirements of the so-called ‘three-step test’ derived from Article 9(2) of the Berne Convention: that the...