Proposed European Commission Directive Leaves File Traders Alone, Butů

By Richard Menta 2/02/03

The European Commission dealing with the issue of file trading presented a draft of a proposed directive last week. Looking to find a balance between copyright holders right to control the content they own and the fair use right of consumers the most distinct aspect of the directive is that it lets file traders off the hook for criminal liability when they trade.

What is good about this directive is it removes the ability of the record industry to prey on individual file trades, forcing them into expensive litigation that can impose heavy fines and even jail terms.


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But remember, we said the directive is looking for balance. The commission that drafted this directive is hardly a friend of KaZaa and iMesh and see a need to control their popularity.

The directive strikes language punishing copyright infringement for commercial purposes. The first reaction might be those who burn copies of CDs to sell at the local flea market. It goes beyond that, specifically taking aim at Peer-to-peer file-sharing services.

According to the commission, file trade services that encourage copyright infringement and make money from advertising are commercial. "That is illegal and should be stopped," the Commission said.

This runs contradictory to the recent Dutch ruling in favor of KaZaa that put the onus on file trading on the users themselves and not onto the P2P clients. Right now, file trade services are legal in the Netherlands.

But the Netherlands are EU members and should the directive be passed it would supersede the Dutch court ruling. Commercial P2P services would be illegal if they allow the trading of copyright material.

"There is also evidence that counterfeiting and piracy are becoming more and more linked to organized crime and terrorist activities because of the high profits and, so far, the relatively low risks of discovery and punishment," the Commission said in a statement. "Pirates and counterfeiters are in effect stealing from right holders," Frits Bolkestein, internal market commissioner said in a prepared statement. "If we don't stamp that out, the incentives for industrial innovation and cultural creativity will be weakened."

Organized crime and terrorist activities?

Strong words, especially since Nikki Hemming hardly seems the al-Qaeda type. As for high profits, the only service making any money to the best of my knowledge is KaZaa. Certainly it's not KaZaa-lite.

And that said, does this mean that KaZaa-lite and Xolox are free from prosecution because they are non-commercial?

That would explain the record industry's condemnation of this directive. My first reaction was that their game plan targeted the prosecution of file traders next and this upset them most. Then I realized that any home-grown, non-centralized service may also be protected as long as they generate no revenue. In essesence this directive says it's ok to facilitate file trading as long as no one makes any money off of it.

"The proposal creates a two tier system of enforcement where some types of piracy are acceptable and others not," the industry organizations said.

We'll keep an eye out for this directive and report when we hear more information.

 


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