The Retained EU Legislation Bill: Part 1: What does this mean for Copyright (and Databases)?

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In late September, the Retained EU Law (Revocation and Reform) Bill 2022-2023 (“the Bill”) was introduced to the House of Commons. The Bill is the latest Brexit statement piece from the Government and proposes major changes to the relationship between UK and EU law.

In short, the REUL project intends, among others, to remove any retained EU legislation that was not enacted by, or by amendment to, primary legislation (i.e. an Act of Parliament) by the end of the ‘sunset period’ on 31 December 2023.

Given there have been a great many (other) political events in the past weeks, the REUL project has not received significant airtime to date. However, if enacted, the Bill would have a very significant effect on the UK legal and regulatory framework, with its impact being felt across a very broad spectrum of legal rights and industries, including the regulation of employment, health and safety, food safety and environmental matters, among others.

In particular, based on the Government’s own tracker, the Bill would potentially automatically remove over 2,400 pieces of retained EU law from the UK statute books at the end of the ‘sunset period’.

Government Ministers will have the power to exempt any specific retained EU law from being sunsetted, which will result in that law being restated into UK law, and may also opt expressly to restate law that is not being sunsetted. In both cases, the Government has scope to make changes to the law so restated. The Government would also have a broader power to revoke and replace retained EU law, whether or not it is being “sunsetted”, as Government “considers to be appropriate and to achieve the same or similar objectives”. These powers to retain, revoke and replace retained law extend beyond the sunset period until June 2026.

All UK primary legislation will remain intact, meaning any amendments to primary legislation made as a result of EU law will remain in place. The Bill will also end the supremacy and general principles of EU law, meaning UK courts will no longer be bound by EU case law.

If you are confused, rest assured, you are not alone. This will make for a particularly complicated legislative landscape and result in a significant degree of uncertainty for some years to come. We will do our best to give clarity in the meantime.

How Will the Bill Affect Copyright?

As matters currently stand, the impact on the statutory landscape for copyright is relatively modest. The majority of EU Directives relating to copyright have been enacted by amending the UK primary legislation (i.e. the Copyright, Designs and Patents Act 1988 (“the CDPA”)) and will therefore survive the legislative bonfire.

As a consequence, whilst the Bill leads to seemingly (and worryingly) arbitrary results in other areas of law, businesses can take some comfort that it at least appears that the legislative landscape for copyright will be less affected than some other areas.

Database Rights may disappear

However, that is not to say that all copyright-related legislation will be protected. By way of notable example, there is some uncertainty around the status of the Copyright and Rights in Databases Regulations 1997, which underpin the sui generis database right. On the basis that those Regulations fall within the definition of “EU-derived subordinate legislation”, then, absent any Ministerial intervention, the legislation will be revoked insofar as it relates to database right. Somewhat arbitrarily, the provisions on copyright in databases under those Regulations would survive, as these were implemented by amending the CDPA.

We would expect to see a concerted campaign to preserve database right from rights holders who are at risk of losing protection. (It should be noted that in this regard in the UK, recently the law of confidentiality has been applied expansively and may in some circumstances provide an alternative form of protection in effect for databases which should continue.)

CJEU caselaw on copyright

Greater effects may be felt from the envisaged departure from retained EU copyright case law. Currently, EU decisions reached prior to 1 January 2021 are binding on the UK courts (Court of Appeal and Supreme Court aside).

Under the Bill, EU cases will no longer act as binding precedent on all UK courts. Whilst a UK court could still consider EU cases for their persuasive value, the courts will be under a duty to interpret EU cases in accordance with primary UK legislation or, if this is not possible, to disregard them. There is also an opaque duty for the courts to consider “the extent to which the retained EU case law restricts the proper development of domestic law”. How the courts will interpret this duty is extremely difficult to predict.

The copyright landscape in the UK has been heavily shaped by EU cases, which in many cases have significantly expanded the scope and availability of copyright protection. The most notable recent example is the CJEU decision in Cofemel v G-Star Raw (C-683/17), which redefined the types of works which are subject to copyright protection. Whilst the CDPA only provides copyright protection for a closed list of categories of works, the decision in Cofemel expanded protection to any ‘identifiable’ work that is the author’s own intellectual creation. This definition has potentially expanded the availability of copyright protection to a plethora of new areas, from programming languages to fabrics, and from facial make-up to literary characters.

In recent case law, such as Response Clothing Limited v The Edinburgh Woollen Mill Limited [2020] WLR(D) 88, [2020] EWHC 148 (IPEC) the courts have sought to construe the CDPA as far as possible to remain consistent with the Cofemel decision (and the EU Copyright Directive). However, if the Bill is passed, then UK courts may feel compelled to depart from such a decision. Given that Cofemel arguably contradicts the closed list of the CDPA, the Bill may make it mandatory for the court to disregard it. Businesses that have relied on copyright subsistence in non-traditional works may find their current copyright protection to be lost.

The recent case of Shazam Productions Ltd v Only Fools The Dining Experience Ltd & Ors [2022] EWHC 1379 (IPEC) also highlights the risk of such a departure. The case concerned whether the characters from the popular sitcom Only Fools and Horses could be protected under copyright. The Court relied heavily on the definition of works in Cofemel to find that literary characters could be protected, by working backwards from the EU definition of a ‘work’ to find that characters could fall within the definition of literary works under the CDPA. It is not clear that the court would reach the same decision after the Bill is enacted. If you would like to find out more about the Only Fools and Horses case, you can read our Law-Now here.

On the other hand, there are also examples of the CJEU making decisions that have narrowed the scope of copyright protection compared to the pre-harmonised position in the UK. A clear example of this is the CJEU’s undermining of the UK’s traditional “sweat of the brow” doctrine, under which the originality of copyright works depended on the effort, skill and/or judgment of the creator. The Infopaq line of cases has made clear that qualification for copyright under EU law is dependent on the work being the expression of the author’s own intellectual creation. It is quite possible that UK courts could be persuaded to return to the traditional British approach to determining which works deserve protection, particularly as this would expand creator’s rights rather than restrict them.

However, whether the UK courts use any new-found power to depart from EU case law where they have some discretion remains uncertain. In the recent case of Warner Music UK v TuneIn [2021] EWCA Civ 441; [2021] Bus L.R. 1119, which concerned the interpretation of “communication to the public”, the Court of Appeal, despite having the freedom to do so, declined to depart from the jurisprudence of the CJEU, suggesting that it may adopt identical or similar approaches to the CJEU wherever possible post-Brexit. The CJEU’s “unrivalled experience” and the need for inter-jurisdictional consistency were cited as factors in favour of such an approach.

Whilst the Bill would remove the binding status of EU case law, we expect the courts will choose to depart from it only sparingly, and where there are clear reasons to do so, especially where to do so would result in a lesser degree of protection for rights owners. However, we might expect the courts to be much more open to revisiting cases where CJEU decisions have had the effect of restricting the rights of creators, particularly where the CJEU has diverged from the traditional British view of copyright as a primarily “economic”, rather than necessarily creative, right.

The TCA and International Treaties

The Bill also raises some important questions in respect of the UK and EU Trade and Cooperation Agreement (“the Cooperation Agreement”), which sets out a large number of minimum legal standards across most industries, including in respect of copyright. Without proper scrutiny, the wholesale revocation of EU-derived regulations could cause an unintentional breach of the Cooperation Agreement. Whilst the risks from a copyright perspective do not appear to be material, we expect this will be a hot topic across the legal industry for the foreseeable future. The UK courts will therefore have to consider the implications of the Cooperation Agreement carefully when making any movement away from the accepted EU position.

It is worth mentioning that the Bill has no impact on the status of international treaties such as the Berne Convention, Rome Convention and WIPO Copyright Treaty and the UK will continue to be a party to those treaties.

Comment

The Bill is still at an early stage, as are the assessments of which EU laws should be kept. However, it seems a Herculean task for the Government to properly scrutinise such a large body of legislation before the end of 2023, given the political and legislative priorities of the current government. As such, swathes of regulations could be struck off the UK statute book arbitrarily or even accidentally, resulting in and unpredictable legislative landscape. Alternatively, there is a strong chance of the ‘sunset date’ being extended to June 2026, as provided for in the draft legislation.

What is clear is that the Bill creates a significant amount of uncertainty. Questions arise over what retained EU law will survive, how assimilated law and UK primary legislation will interact, and whether courts will choose to depart from copyright law principles established in EU case law. This will make it difficult for businesses to determine exactly what the law is, or will be, and how to comply with it.

The Government insists that the Bill will empower and not hinder the UK’s competitive advantage. However, achieving that goal will require parliamentary time and drafting, which may well be in short supply within the relatively short timeframe of the end of 2023. Entrusting the final decisions to Ministers is unlikely to result in proper scrutiny and may hamper the Government’s stated aim. Rights holders with concerns about losing rights have a short timeframe in which to lobby Government prior to the end of the sunset period.

Overall, what the Bill lacks is any sense of clarity. The extensive powers for Ministers to strike off and resurrect any piece of retained EU legislation may help to reverse any unforeseen legislative casualties or consequences, but such powers also undermine legal certainty. Businesses’ ability to plan will therefore be significantly hampered for some time to come. As ever, we shall have to wait and see.