With the digital revolution well upon us, countries worldwide are revisiting their private copy levies systems.  The Business Software Alliance (BSA) and the European-American Business Council (EABC) welcome the reassessment of these regimes. We strongly support fair and full remuneration for rights owners for the sale, licensing and other uses of their products.  We believe that levies are not an appropriate or necessary way to compensate authors.

Levies were first introduced in the analogue world as a mechanism to compensate authors for losses due to “private” copying of music and movies.  Levies have never been applied to software, and they should not be.  Because the levies system has little ability to reflect accurately the actual value and use of any particular work, levies are at best a rough form of justice.  They reflect a compromise solution in a world where the technology did not exist to manage particular uses of works. 

Digital technologies, including “digital rights management systems” (DRMs), now enable authors to better manage uses of their works and to be paid for the use a consumer actually makes of those works.  These technologies thus call into question the necessity of levies—in some cases rendering levies duplicative and obsolete.

BSA and EABC support the following elements in any levies system:

• Greater transparency and accountability:  At present, it can be difficult for authors and consumers to understand how levy rates are assessed, on what products they apply, and how proceeds are distributed.  Moreover, mechanisms to challenge levy assessments can be unduly burdensome and dauntingly complex.
• Clear justification for levy rates:  At a minimum, there should be some analysis of the harm caused by private copying before assessing “fair compensation”.  Where the harm is nominal, consumers should not bear the burden of a levy.
• Fair treatment of consumers:  Where DRM technologies are in place, levies should be eliminated to ensure that users are not paying for copies for which they have already paid through a license.  Moreover, consumers should not be asked to pay levies on products (including information technology equipment) that account for minimal copying of those works with which levies are concerned. 
• Voluntary management of rights: An author’s ability to control the exploitation of his or her work lies at the heart of copyright.  Accordingly, any collective management of an author’s rights should be wholly voluntary. 
• TRIPS-compliant private copy regimes:  The TRIPS Agreement makes clear that exceptions to exclusive rights under copyright can apply only in “certain special cases” that do not conflict with a normal exploitation of the work and do not prejudice the legitimate interests of the right holder.  Private copy exceptions must be narrowly crafted to ensure they do not violate these limitations.