1. Copyright Subsistence
1.1 What are the requirements for copyright to subsist in a work?
The requirements for the protection of a work under a copyright [Urheberrecht] as well as the requirements for the protection of artistic performances (performances of musicians, actors, dancers, etc.) and certain productions (sound masters, films, databases, press publications, broadcasting programs and artistic live events) under the so-called related rights (neighbouring rights) [Leistungsschutzrechte] are stipulated in the German Act on Copyright and Related Rights (“GCA” [Urheberrechtsgesetz, UrhG]. The following is a link to an English translation of the GCA: https://www.gesetze-im-internet.de/englisch_urhg/englisch_urhg.html).
For protection as a work, it is required that the author’s own intellectual creation, having evolved in a perceptible form, meets the threshold of originality. The degree of originality is, generally, quite minimal (e.g., software only requires individuality). Mere thoughts, ideas, concepts or formulas remain outside the scope of protection; only a concrete and perceptible creation qualifies as a work.
1.2 On the presumption that copyright can arise in literary, artistic and musical works, are there any other works in which copyright can subsist and are there any works which are excluded from copyright protection?
The GCA does not provide for an exhaustive catalogue of protected categories of works. Generally, every creation with sufficient originality is eligible for protection. Only “official works” (acts, statutory instruments, decrees etc.) do not enjoy protection. The non-exhaustive catalogue of the GCA comprises works in exemplified categories, i.e. literature (which includes software), music, pantomimic and dance works, artistic works (including architecture), photographic and cinematographic works as well as illustrations of a scientific or technical nature, such as drawings, plans, maps, sketches, tables and three-dimensional representations.
In addition to the copyright, the GCA stipulates the “related rights” (neighbouring rights). These rights are granted as a reward for certain accomplishments (which relate mostly, but are not limited to, the cultural domain) and protect the performance of an artist (musical performances or performances in theatre or film as well as creative producers or conductors), as well as certain productions (audio and audio-visual recordings, broadcasting programmes, press publications, databases and artistic live events).
1.3 Is there a system for registration of copyright and if so what is the effect of registration?
Generally, protection as a copyright or as neighbouring rights does not depend on registration. Protection evolves upon creation of a work (or, with regard to neighbouring rights, upon the coming into existence of a performance or a production).
In respect to anonymous and pseudonymous works only, an entry in the “Register of Anonymous and Pseudonymous Works” is possible in order to document the date of death of the author to ascertain the duration of the protection period, which would otherwise be calculated from the date of publication.
1.4 What is the duration of copyright protection? Does this vary depending on the type of work?
Copyright protection for works – irrespective of category – expires 70 years after the creator’s date of death; in case of joint authorship, the period commences upon the date of death of the longest-living co-author. Anonymous and pseudonymous works (without registration, see question 1.3) are protected for a period of 70 years following their publication and unpublished works of such authors are protected for a period of 70 years from their creation.
Shorter periods apply for certain neighbouring rights: photographs, moving pictures and broadcasters (50 years); scientific editions and artistic event organisers (25 years); databases (15 years) and press products (one year), generally following the publication or, if unpublished (except for the press product), the production. For performances recorded on a sound carrier and for sound carriers, the protection period can run for 70 years following the release or public communication of the recording (with an exception for sound carriers not released or lawfully used in public communication or released later than 50 years following the production). For audio-visual performances and recordings, the period of protection is 50 years following the release or public communication (or 50 years following the performance where a recording has not been released within this period or has not been legally used for public communication).
1.5 Is there any overlap between copyright and other intellectual property rights such as design rights and database rights?
There are overlaps between copyright and other intellectual property rights, i.e., design rights and trademark rights, with respect to protection. Protection as a design, for example, can extend to specific two-dimensional or three-dimensional appearances of the whole or a part of a product. Further, a graphic design may be protected as a trademark. The German Act against Unfair Competition may provide protection against imitations. A database can be eligible for protection as a work under copyright (as a result of a specific systematic or methodical arrangement of the individual elements) and enjoy protection under the neighbouring rights as well (due to the investment made to establish the database).
1.6 Are there any restrictions on the protection for copyright works which are made by an industrial process?
There are no such restrictions; however, only natural persons are entitled to a copyright in works and any creation must, eventually, be attributable to human creativity (different for producer rights).
2.1 Who is the first owner of copyright in each of the works protected (other than where questions 2.2 or 2.3 apply)?
The creator of a work is the owner of the copyright and remains the owner until the copyright expires; the same concept applies, mutatis mutandis, for neighbouring rights of performing artists, whereas ownership in producer rights can be transferred.
2.2 Where a work is commissioned, how is ownership of the copyright determined between the author and the commissioner?
The copyright as such as well as the exploitation rights are not transferable (except for inheritance). However, the author can grant a right-of-use [Nutzungsrecht] to the commissioner; such right-of-use may be further defined (limited or unlimited) in respect of place, time or content as well as exclusivity. The concept of the grant of right-of-use is applicable for licensing rights from performing artists, while other neighbouring rights allow for a full transfer of the ownership as well as the assignment of the exploitation rights.
2.3 Where a work is created by an employee, how is ownership of the copyright determined between the employee and the employer?
The ownership remains with the employee as the creator; however, for works (as well as for performances subject to neighbouring rights) created in fulfilment of the employment relationship, exclusive rights can be assumed by the employer by operation of law. Nevertheless, the stipulation of a transfer of rights is customary in most employment contracts and is advisable.
2.4 Is there a concept of joint ownership and, if so, what rules apply to dealings with a jointly owned work?
The GCA recognises joint authorship [Miturheberschaft] where two or more people have collectively created a work and it is not possible to separately exploit their individual contributions. As a result of joint authorship, the publication, exploitation or alteration of the work requires the consent of each co-author, unless agreed otherwise in an agreement.
Where several authors combine their works by way of compound work [verbundene Werke] for the purpose of joint exploitation (e.g., music and lyrics), each author’s consent is required for the publication, exploitation or alteration of the compound work, unless agreed otherwise in an agreement.
3.1 Are there any formalities which apply to the transfer/assignment of ownership?
Ownership of a copyright in a work (or in the evolving exploitation rights) cannot be transferred (except for inheritance). Ownership in a neighbouring right (as well as the evolving exploitation rights) is transferable (with certain restrictions, however, for artists), and such transfer is not subject to any mandatory formalities.
3.2 Are there any formalities required for a copyright licence?
Generally, the author is free to grant a right-of-use (exclusive or not, limited or unlimited with regard to place, time and content) by way of (licence) agreement without any specific form being legally mandatory; i.e., oral and even implied licence grants are possible. Only where such grant relates to future types of use of a work, the contract must be in writing (this does not apply to artists). A further exception relates to any grant pertaining to a future work – i.e., a work that is not yet defined at all or only determined by category (e.g., a novel, an album, etc.) – for which the agreement needs to be in written form (this also applies to agreements of future artistic performance not yet further defined).
If a licensee intends to transfer the acquired right-of-use (or, in case of an artist, to transfer the exploitation right), such transfer generally requires the author’s (or artist’s, respectively) consent, except where agreed otherwise in an agreement; such consent may not be withheld in bad faith.
3.3 Are there any laws which limit the licence terms parties may agree (other than as addressed in questions 3.4 to 3.6)?
Generally, the author (as well as the artist regarding his performance) cannot waive his inherent moral rights with regard to the right to be identified as the author of a work, and the right to prohibit the distortion or any other derogatory treatment of his work. Only interventions with moral rights, which are specifically foreseeable (e.g., explicitly stipulated in an agreement), so that the scope and consequences of the interventions can be assessed by the author, are deemed permissible. For all other interventions of the moral interest of the author, subsequent consent relating to the specific case at hand needs to be sought.
As with any agreement or market practice, licensing can also be subject to certain restrictions under anti-trust laws, in particular in the context of market dominance.
The EU’s 2018 Regulation on cross-border portability of online content services in the internal market provides that licensing terms are void and unenforceable, if these terms prohibit or limit the cross-border portability of online content services covered by the Regulation.
3.4 Which types of copyright work have collective licensing bodies (please name the relevant bodies)?
There are three major collective licensing bodies:
- GEMA: the GEMA (society for musical performances and mechanical reproduction rights) is the largest collective licensing body in Germany, representing the usage rights stemming from authors’ rights (including lyricists and publishers) for their musical works (incl. lyrics).
- GVL: the GVL (society for the exploitation of neighbouring rights) administers the so-called “secondary exploitation” rights (in particular, the collection of levies on linear public communication and broadcasting) of neighbouring rights holders (artists, producers) in the field of music, video and television.
- VG Wort: the VG Wort (Collecting Society Wort) manages the royalties resulting from secondary exploitation rights in language works, including those of radio and television.
(The following is a link to a list of further German collective licensing bodies: https://www.dpma.de/dpma/wir_ueber_uns/ weitere_aufgaben/verwertungsges_urheberrecht/aufsicht_verwertungsges/liste_vg/index.html.)
3.5 Where there are collective licensing bodies, how are they regulated?
The collective licensing bodies are regulated by the German Act on the Management of Copyright and Related Rights by Collecting Societies [Verwertungsgesellschaftengesetz] (“CSA”), which implements the European Union’s CRM Directive (Dir. 2014/26). The CSA outlines the administrative organisation, the rights and the obligations of collecting societies as well as their power to enforce rights on behalf of the members of the society. Legal supervision over collective licensing bodies in accordance with the CSA rests with the German Patent and Trademark Office (“DPMA”).
3.6 On what grounds can licence terms offered by a collective licensing body be challenged?
Licence terms have to be fair and just. In cases of dispute, the parties must resort to a specific copyright arbitration board [Schiedsstelle] before the matter can be taken to the regular courts. The copyright arbitration board is located at the DPMA in Munich.
In case of a dispute with a collection society, a compulsory licence is available for the potential licensee against the disputed portion of the royalty. The amount is either being paid under reserve or into escrow until the dispute is finally settled.
4. Owners’ Rights
4.1 What acts involving a copyright work are capable of being restricted by the rights holder?
The author has the exclusive right to exploit (or, by way of granting rights-of-use, delegate the exploitation of) his work under copyright in any material (reproduction, distribution, exhibition) and immaterial form (communication to the public, recitation, performance and presentation, broadcasting etc.). For neighbouring rights, the scope of exploitation rights can be smaller, e.g., artists are not awarded exclusive rights for the broadcasting of recorded performances.
4.2 Are there any ancillary rights related to copyright, such as moral rights, and if so what do they protect, and can they be waived or assigned?
The inherent personal rights of an author as his moral rights (his right of first publication, the right to be identified/not identified as the author of the work and the right to integrity of his work) are assumed upon the creation of a work and are inseparable from the author. A general waiver for future interventions is not permissible and only specific and foreseeable interventions can be the subject of the author’s anticipated consent. The artist has similar moral rights to the same effect.
4.3 Are there circumstances in which a copyright owner is unable to restrain subsequent dealings in works which have been put on the market with his consent?
The right of distribution (for work under copyright as well as for neighbouring rights) is exhausted (generally similar to the US “first sale doctrine”) once the original or copies of the work have been brought to a market within the territory of the European Union (or the EEA) by sale and with the consent of the rights holder; the further physical dissemination of such items is permissible (except by means of rental and lease and except for any immaterial exploitation). According to the European Court of Justice (“ECJ”) in its Used-Soft decision, the principle of the exhaustion applies, mutatis mutandis, to a software copy that has not been (physically) distributed but acquired via an online transaction.
In accordance with the ECJ’s case law on the right to make works available to the public, the author cannot prohibit hyperlinking, deep linking or framing of his work once it has been published on the Internet without technical restrictions.
5. Copyright Enforcement
5.1 Are there any statutory enforcement agencies and, if so, are they used by rights holders as an alternative to civil actions?
There are no statutory enforcement agencies as an alternative to action under civil or criminal laws.
5.2 Other than the copyright owner, can anyone else bring a claim for infringement of the copyright in a work?
Any exclusive licensee has standing to bring a claim for infringement of a copyright or neighbouring right when his licence is concerned.
A non-exclusive licensee has no standing to sue, unless he is authorised by the rights owner or the exclusive licensee.
5.3 Can an action be brought against ‘secondary’ infringers as well as primary infringers and, if so, on what basis can someone be liable for secondary infringement?
A primary infringement presupposes that a person has either committed the relevant act that infringes the copyright (qualifying as a perpetrator [Täter]), or that a person has instigated an infringement or intentionally made an aiding and abetting contribution to the infringement (qualifying as a participant [Teilnehmer]).
A secondary infringer is a person who, without being a perpetrator or participant, willingly contributes in any way and, thereby, adequately causes the infringement [Störer]. Liability for a secondary infringement occurs where a legal and factual possibility of its prevention existed and where the secondary infringer, therefore, violated a duty of care. A secondary infringer is generally liable for injunctive relief, but not for damages.
5.4 Are there any general or specific exceptions which can be relied upon as a defence to a claim of infringement?
There are general exceptions as well as specific exception clauses tailored to the respective copyrights, provided for by the GCA and designed to balance the rights owners’ interests with public interests and benefits (Chapter 6: Limitations on copyright through lawfully permitted uses). Here, the GCA provides that under certain circumstances, it is permissible for a natural person to make (or have made) single copies for private use. Further exceptions relate to quotations, use by disabled persons or use for religious purposes, use in schools, public speeches, newspapers and media, etc. Certain permitted uses are for free, while some require remuneration; private use is the basis for levies payable on blanket media and copy devices.
5.5 Are interim or permanent injunctions available?
The German law provides for preliminary or interim relief, which can be granted by means of an injunction within a couple of days in case of ex parte proceedings or within a few weeks where an oral hearing takes place. The application for a preliminary injunction must be submitted to the court in a swift fashion; a claimant waiting for more than a month following his knowledge of the relevant factual circumstances of the matter may face dismissal of his application for lack of urgency. Generally, prior to any preliminary court proceedings, the claimant must serve on the defendant a warning letter and provide him with the opportunity to settle the matter out of court.
Once a preliminary injunction has been granted and has not been lifted in an appeal (or in preceding opposition proceedings in case of an ex parte order), it stays in effect permanently until the action on the merit in the main proceedings is finally resolved.
Even though there is no general discovery in German law, in particular in IP litigation, there are some exceptions to this rule, which allow the defendant inspection and other means of discovery. Such remedies can be available in the preliminary proceedings.
5.6 On what basis are damages or an account of profits calculated?
The claimant may choose between three methods of calculation (which are not to be combined): compensation of his actual damage (lost profit, frustrated costs, etc.); handover of the profit of the infringer; or payment of an amount equal to a customary licence fee. The final decision must be made only in the last oral hearing at court. The claimant is entitled to claim from the infringer all information that is required to calculate the potential damage amount, e.g., number of copies produced and sold with prices.
5.7 What are the typical costs of infringement proceedings and how long do they take?
Costs depend mainly on the value in dispute (further determined by the fee agreements of the attorneys involved). German law provides for statutory fees applicable for courts, experts and attorneys, which all depend on the value in dispute. Costs of court proceedings (including fees for attorneys up to the statutory rates) are distributed among the parties in relation to their success, e.g., if a claim is granted in total, the defendant has to bear the court’s costs and reimburse the claimant for his attorney fees (capped at the statutory rate). With attorneys and experts other fee arrangements (e.g., hourly rates) can be agreed. Fees resulting in an excess of the statutory rates cannot be recovered from the defeated party.
While a preliminary injunction can be granted within days following the application, main proceedings for action on the merits can take between eight to 20 months, sometimes even longer, depending on the case load of the court and the complexity of the matter (in particular, the need for evidence-taking procedures). An appeal can take the same amount of time.
5.8 Is there a right of appeal from a first instance judgment and if so what are the grounds on which an appeal may be brought?
There are up to two instances to remedy a first instance decision: the appeal [Berufung] reviews all facts, evidence and legal issues for legal errors; this appeal is always available. A further remedy [Revision], filed with the Federal Court of Justice [Bundesgerichtshof], is only permissible if the appeal grants the possibility of revision or if the Federal Court views the case eligible for revision. The revision to the Federal Court only comprises of a review for legal errors in the application of the laws by the first instance and the appellate court; no new facts can be presented.
5.9 What is the period in which an action must be commenced?
A preliminary injunction must be applied for within one month at the latest, following the knowledge of the facts of the matter.
Action on the merits is time-barred within three years following the end of the year during which the claimant obtained knowledge of the facts relevant to the case. Claims for a fictional licence fee to compensate damages can be brought to court within a longer period of 10 years following the infringement.
Irrespective of a claimant’s knowledge, limitation-in-time in a copyright matter becomes applicable 10 years after the claim arose.
6. Criminal Offences
6.1 Are there any criminal offences relating to copyright infringement?
Generally, any culpable and intentional violation of copyright or a neighbouring right (including the attempt to violate) can be prosecuted as a criminal offence.
6.2 What is the threshold for criminal liability and what are the potential sanctions?
The infringing act must have been committed with culpable intent; negligence, even gross negligence, is not sufficient.
Generally, the rights holder must file charges to initiate prosecution, unless the state attorney regards action to be necessary ex officio on account of the public interest.
The sanctions range from payment of a fine to imprisonment of up to three years. Infringement on a commercial scale can qualify for imprisonment of up to five years. Material connected with the infringement (e.g., production devices, raw material, etc.) can be subject to confiscation by the authorities.
7. Current Developments
7.1 Have there been, or are there anticipated, any significant legislative changes or case law developments?
- In a recent decision, the ECJ (C-469/17 – Afghanistan papers) dealt with the question of to what extent a state can prevent the publication of documents by the press by invoking copyright law. The ECJ ruled that even a state can, in principle, rely on copyright protection, whereby it must be examined in individual cases whether a copyright actually exists. However, even if copyright protection exists, the press can still rely on exceptions and restrictions of the Copyright Directive (2001/29/EC). The ECJ clarified in that context that freedom of information and freedom of the press cannot, outside the exceptions laid down in Directive 2001/29/EC, justify any impairment of the exclusive rights of the author to reproduce and communicate to the public. In the decided case, the ECJ nevertheless considered the publication of the Afghanistan papers to be permissible and pointed out that the exception in Art. 5 para. 3 lit. c of the Copyright Directive, which gives priority to freedom of the press in the report on current economic, political or religious topics, is likely to be relevant.
- In its decision, Reformistischer Aufbruch (C-516/17), the ECJ ruled – in line with its Afghanistan papers decision – that freedom of information and freedom of the press outside the exhaustive exceptions of the Copyright Directive (2001/29/EC) cannot justify a derogation from the exclusive rights of the author. In the necessary balancing of copyright and freedom of expression, however, the nature of the information in question is of particular importance. The ECJ further clarified that the exception for the use of protected works in the context of reporting on current events (Art. 5 para. 3 lit. c of the Copyright Directive) does not depend on the author’s prior request for permission. In addition to the source, the only requirement is that the use is necessary to achieve the information purpose. In addition, the “right to quote” (specified in Art. 5 para. 3 lit. d of the Copyright Directive) also includes linking to independently retrievable files and does not require an inseparable integration of the cited work into the article itself. However, the cited work must have already been made available to the public in its concrete form with the consent of the right holder, on the basis of a compulsory licence or legal permission.
- In a further decision (C-476/17 – Sampling as unauthorised reproduction), the ECJ ruled that sampling does not necessarily infringe the author’s rights without the author’s consent. The ECJ points out that the reproduction of an “audio fragment”, even a very short one, is in principle subject to the exclusive right of the phonogram producer. However, the ECJ clarified that there is no “reproduction” if a user, in exercising his artistic freedom, takes an audio fragment from a sound carrier in order to insert it into a new work in a modified form that is not recognisable when it is heard. This case is pending with German courts (district and appeal courts of Hamburg, Federal Court of Justice and even the Federal Constitution Court, since 1999).
7.2 Are there any particularly noteworthy issues around the application and enforcement of copyright in relation to digital content (for example, when a work is deemed to be made available to the public online, hyperlinking, etc.)?
- In May 2019, Directive (EU) 2019/790 (DSM Directive), concluded in April 2019, was published. In order to adapt copyright law to the requirements of the digital society, provisions have been concluded which provide for – inter alia – an ancillary copyright for press publishers, exceptions for text and data mining as well as provisions for harmonised copyright contract law. Further, the DSM Directive also contains a new liability regime for certain online intermediaries, which was the most controversial regulation in the legislative process.
- Directive (EU) 2019/789 of the European Parliament and of the Council (Online Sat-Cab Directive) was also published in May 2019. The Directive must be transposed into national law by the Member States by 07.06.2021. This Directive extends the “old” Sat-Cab Directive 93/83/EEC and allows companies to retransmit an initial programme in a technology-neutral way (e.g. online via OTT-services). For this purpose, the Member States must ensure that right holders may exercise their right to grant or refuse the authorisation for a retransmission only through a collective management organisation. Further, the Directive aims to facilitate the cross-border provision of “ancillary online services” in relation to certain types of programmes by implementing the “country of origin principle” for these online services.
- A change in legislation in 2013 amended the GCA, and established an ancillary right for press publishers. The amendment intends to compensate publishers for press content being displayed via online services and search engines such as Google. A significant number of German press publishers jointly established the collecting society VG Media for the negotiation of licensing fees on their behalf.
While Google refused negotiations, claiming that the regulation is not applicable to their services and that the demanded fees are not equitable, several publishers entered into free-of-charge agreements with Google for the further display of their content. In 2014, VG Media declared that the press publishers had instructed it to give Google revocable permission to use their content free of charge, linking this decision to Google’s market dominance. The supervising DPMA prohibited the free-of-charge practice of VG Media in 2015 but, upon appeal, entered into administrative litigation before the Munich Administrative Court [Verwaltungsgericht München].
In June 2014, VG Media filed a civil lawsuit for compensation against Google; the case was first heard by the copyright arbitration board [Schiedsstelle] (see question 3.6) and then moved to the regular courts. In 2017, the Regional Court of Berlin [Landgericht Berlin] suspended the civil proceedings regarding VG Media’s claim for compensation and requested a preliminary ruling of the ECJ. The Regional Court stated that the validity of the claim depends on whether the government should have notified the EU Commission of the amendment back in 2013. In May 2018, the Munich Administrative Court also suspended proceedings due to the pending preliminary ruling of the ECJ. The Advocate General published his Opinion in December 2018 and stated that he did not consider the German ancillary rights for press publishers to be applicable. The German legislator should have executed a notification procedure in 2013, as the regulations are subject to a European Directive. A decision of the ECJ is still pending. In May 2019, Google rejected VG Media’s settlement offers.
- Following the ECJ’s decisions Svensson (C-466/12), BestWater International (C-348/13), (C-160/15 – GS Media), Filmspeler (C-527/15) and Renckhoff (C-161/17), courts dealt also in recent times on several occasions with the Right of communication to the public of works and right of making available to the public other subject-matter in the sense of Art. 3 of Directive 2001/29/EC.
- In April 2019, the Federal Court of Justice asked the ECJ for a preliminary ruling regarding framing again (I ZR 113/18), inquiring whether a collecting society may require a user to take technical measures against framing if the user wishes to conclude a user contract with the collecting society. In the case to be decided, the German Digital Library (“DDB”) provides links on a platform through which digitised content from other web portals can be accessed. The DDB uses thumbnails for this content. The DDB’s institution requests VG Bild-Kunst to conclude a user contract for the use of these thumbnails. VG Bild-Kunst is only willing to conclude such a contract of use if it contains a clause according to which the DDB takes effective technical measures against framing.
- In 2018, the Federal Court of Justice (I ZR 140/15) dealt with the question concerning the liability of YouTube for copyright infringements caused by users’ video uploads. In September 2018, the Federal Court suspended the proceedings and submitted several questions to the ECJ. In particular, it would like to know whether the operator of an Internet video platform on which users make videos with copyrighted content publicly accessible without the consent of the right holders performs an act of communication to the public within the meaning of Art. 3 (1) of Directive 2001/29/EC. The decision of the ECJ on this matter is still pending. In the meantime, however, the DSM Directive has also been issued, which contains provisions precisely on these topics.