Copyright in information technology and marketing on the Internet

Transcription

1 Copyright in information technology and marketing on the Internet by Peter Danowsky Alexandra Persson

2 TABLE OF CONTENTS 2 1 WHAT IS COPYRIGHT? 2 THE LEGAL FRAMEWORK 2.1 International regulations 2.2 EC Directives Directives on copyright protection Protection of computer programs and databases Protection of topographies of semiconductor products Directive on electronic commerce 2.3 National framework 3 FURTHER ON THE NATIONAL REGULATIONS 3.1 How is copyright obtained? 3.2 Authorship and ownership 3.3 Exclusive rights Economic rights Moral rights 3.4 Limitations and exceptions to copyright 3.5 Duration of copyright 3.6 Neighbouring rights 3.7 Transfer of rights 3.8 Obligations as to technological measures 3.9 Protection of computer programs Copyright or patent? Further on the copyright protection of computer programs Limitations with regard to the exclusive rights Escrow of source code

3 3 4 CONTRACTUAL RELATIONS 4.1 Employer/employee 4.2 Work for hire 4.3 Licensor/licensee 4.4 Some general considerations regarding transfer of rights 5 FILE SHARING 6 INTERNET SERVICE PROVIDERS AND COPYRIGHT 7 CONCLUDING REMARKS AND CHECKLIST 8 MARKETING ON THE INTERNET 8.1 In General 8.2 EC Directive on good marketing practice 8.3 Search engines, marketing and copyright

4 1 WHAT IS COPYRIGHT? 4 Copyright is the legal term describing rights given to creators for their literary and artistic works. This includes literary works such as novels, plays, newspapers, computer programs, databases, films and musical compositions; and artistic works such as paintings, drawings, photographs and architecture. Alongside these copyright-protected works, the copyright legal framework also provides protection for certain neighbouring rights. These rights are similar, although often more limited and of shorter duration. Performing artists, broadcasting organizations and producers of sound recordings are covered by these rights. Copyright-protected works are generally the result of creative skills and significant labour and investments. Consequently, incentives in the form of recognition and fair economic reward as well as protection against unauthorized use, copying and piracy are crucial for the future continuation and development of copyright. The protection of copyright is probably essential to encourage future creativity and development of new material which will benefit society in general. The recent years development of information technology, and in particular digital technology and the Internet, has had a considerable effect on copyright given that the new technology enables us to use and exploit copyright-protected works in new and more efficient ways. This development has introduced new difficulties in enforcing copyright and prompted reinterpretation of old regulations. To some extent even the copyright law's philosophic basis has been challenged. Taken as a whole, legislators across the world have been pushed to revise and amend the copyright legal framework in order to strengthen the protection in response to the technological development. Even so, the legal framework for copyright and its related rights is today much-disputed and constantly challenged in many quarters. This chapter aims to provide a short introduction to the legal aspects of copyright with special emphasis on copyright and copyright issues of concern and interest for those involved in information technology. 2 THE LEGAL FRAMEWORK 2.1 International regulations Since as far back as the 19 th century, copyright has been subject to extensive international cooperation and treaties. The Berne Convention of is one of the oldest international 1 The Berne Convention for the Protection of Literary and Artistic Works of 1886.

5 treaties governing copyright protection. The convention rests on basic principles and contains a series of provisions determining the minimum protection to be granted. The convention provides, for example, a list of rights enjoyed by authors, such as the right to authorize or prohibit reproduction, public communication and adaptation of copyrighted works. The convention has been amended on a regular basis and is considered one of the major existing international treaties in the field of intellectual property. One important feature of the Berne Convention is its special provisions regarding developing countries which want to make use of the rights. 5 In 1996 two treaties were concluded by the international community with the purpose of updating and supplementing the already existing treaties on copyright and related rights, primarily in order to respond to the developments in technology and in the marketplace. The WIPO Copyright Treaty, WCT, regulates the protection for authors of literary and artistic works, whilst the WIPO Performances and Phonograms Treaty, WPPT, regulates the protection for certain neighbouring rights. The agreements grant, for example, rights with respect to distribution activities and computer programs. They also aim to protect against unauthorized Internet use and to protect the technological measures that are used on products containing copyright-protected works. In addition hereto, the so called TRIPS Agreement 2 constitutes an important complementary regulation. The TRIPS Agreement has been in force since 1995 and is administered by the WTO, the World Trade Organization. This requires all WTO members, with few exceptions, to adapt their laws to the minimum standards laid down in the agreement. The agreement provides global minimum standards for protecting and enforcing nearly all forms of intellectual property rights. Regarding copyright, it requires all WTO members to comply with the substantive provisions of the Berne Convention. Further, it ensures that computer programs shall be protected as literary works and lays down on what basis databases shall be protected by copyright. The agreement also lays down important additions to existing international rules on rental rights. For example, it requires authors of computer programs and producers of sound recordings to be given the right to authorize or prohibit the commercial rental of their works to the public. 2.2 EC Directives Within the European Union, there has throughout the years been significant harmonization of substantive copyright law to reduce barriers to trade and to adjust the legal framework to new forms of exploitation. A common legal ground is considered crucial with respect to the 2 Trade Related Aspects of Intellectual Property Rights.

6 rules on the enforcement of rights, i.e. sanctions and remedies regarding copyright infringements, and the overall access to justice Directives on copyright protection There are several directives regulating the protection of copyright. One of the most significant directives is the so called Infosoc-directive, 2001/29/EC 3. It covers the legal protection of copyright and related rights, with particular emphasis on the information society. The directive is based on principles and rules already lay down in previous directives. It develops these principles and rules and places them in the context of the information society. For example, the directive further harmonizes the author s right to communication to the public, reproduction rights and distribution rights. It also provides an exhaustive list of exceptions and limitations to the rights of reproduction and communication. Most of these are non-mandatory and therefore finally accorded at national level. However, one of the exceptions is mandatory. It provides an exception to the right of reproduction in respect of certain acts of temporary reproductions which are integral and essential to a technological process. The exception applies if the purpose is to enable a work to be lawfully used or just transmitted in a network between third parties by an intermediary provided that the reproduction has no separate economic significance. The Infosoc-directive also states that right holders should have the possibility of applying for an injunction against an intermediary whose services are being used by a third party to infringe the right holder s intellectual property right. In order for all member states to have a similar set of measures, procedures and remedies available for right holders to defend their intellectual property rights, the Enforcementdirective, 2004/48/EC 4, was adopted. The objective of the Enforcement-directive is to harmonize the legislative systems within the internal market in order to ensure a high, equivalent and homogeneous level of protection of intellectual property rights. The directive states that all member states shall provide for the measures, procedures and remedies necessary to ensure the enforcement of the intellectual property rights covered by the directive. Those measures, procedures and remedies shall be fair and equitable and shall not be unnecessarily complicated or costly, or entail unreasonable time-limits or unwarranted delays. The directive covers provisional and precautionary measures, injunctions, evidence and measures for preserving evidence. The scope of the directive is wide in order to encompass all intellectual property rights covered by community provisions in this field. 3 Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society. 4 Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights.

7 7 Directive 2006/116/EC 5 regulates the level of protection of copyright and related rights. It lays down not only the terms of the protection as such but also certain implementing arrangements, such as the date from which each term of protection should be calculated. The directive states that the term of protection for copyright should be harmonized at 70 years after the death of the author or 70 years after the work is lawfully made available to the public, and for related rights at 50 years after the event which sets the term running Protection of computer programs and databases According to the directive on computer programs, 91/250/EC 6, all member states shall protect computer programs under copyright law as literary works. The directive establishes who and what shall be protected and for how long. It should be noted that the copyright protection covers only the expression of the computer program, not the ideas and principles that underlie the elements of the computer program, including those that underlie its interfaces. In accordance with this principle, algorithms, logic and programming language are not covered by the protection to the extent they comprise ideas and principles. The objective of the directive is to harmonize the member states' legislation regarding the protection of computer programs in order to create a legal environment which will afford a degree of security against unauthorized reproduction of such programs. In conformity with the protection of computer programs, databases are also protected under copyright law. This is stated in the database-directive, 96/9/EC 7. The directive applies to the structure and arrangement of contents of databases, so called "original" databases. It protects collections, so called compilations, of works, data and other materials that are arranged, stored and accessed by both electronic and non-electronic means. The term database can include both collections of works and collections of other materials that are systematically or methodically arranged and that can be individually accessed. In this context the directive states that the only criteria used to determine whether a database shall be protected by copyright is that the selection or the arrangement of the content of the database is an effect of the author s own intellectual creation. Consequently, the copyright protection covers only the selection and the arrangement of the content, not the content as such. In order to protect those databases that do not meet the criteria for copyright protection mentioned above, the directive has also established an exclusive 'sui generis' right for database producers to protect their investment of time, money and effort rather than the sole 5 Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights. 6 Directive 91/250/EEC of 14 May 1991 on the legal protection of computer programs. 7 Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases.

8 intellectual creation. This protection falls under the neighbouring rights and is generally referred to as "non-original" databases. 8 While the copyright protection grants the creator of a database a group of exclusive rights regarding reproduction, alteration and distribution the neighbouring rights grant a right to prevent unauthorised extractions and reutilization of content and the right to prohibit acts that unreasonably prejudice the legitimate interests of the proprietor of the rights Protection of topographies of semiconductor products Developments of semiconductors require a considerable amount of investment while the topographies of such products can be copied at a fraction of the cost needed to develop them independently. The directive on semiconductor topographies, 87/54/EC 8, recognises this and harmonizes the basic principles governing the legal protection of original topographies of semiconductor products. The directive lays down certain basic principles specifying who and what shall be protected, the exclusive rights on which protected persons shall be able to authorize or prohibit certain acts, exceptions to these rights and for how long the protection lasts. Other matters, such as whether registration or deposit is required as a condition for protection and other general conditions for licenses, are left to the member states to regulate in national law Directive on electronic commerce The directive on electronic commerce 9 aims to create a legal framework to ensure the free movement of information society services. Information society service means any service normally provided for remuneration, at a distance, by electronic means and at the individual request of a recipient of such services. Even though the directive principally regulates a wide range of economic activities that take place on-line, e.g. commercial communications and formation of online contracts, the directive should be mentioned here since it also deals with the liability arising from the copyright infringements of intermediary service providers, in particular hosting services. The directive exonerates intermediary service providers from liability where they have played a passive role in transmitting information from a third party. The directive also exempts web-hosting providers from liability for illegal content transmitted over their servers, if they are unaware of the illegal nature of the content and immediately block access to such content once they become aware of the same. 8 Council Directive 87/54/EEC of 16 December 1986 on the legal protection of topographies of semiconductor products. 9 Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market.

9 9 2.3 National framework While in some countries the provisions of the above-mentioned treaties can be directly applied as law, in general copyright and related rights are provided in the national legislation of each country. The above-mentioned international conventions and treaties oblige the associated countries to provide a minimum level of copyright protection laid down in the treaties. Likewise is the case with the EC directives. Due to that, most countries, in particular within in the European Union, have national copyright regulations that are quite similar. In section 3, the content of these national copyright laws will be further illustrated. In this context, it shall also be mentioned that there is no such thing as an international copyright that will automatically protect an author s work throughout the entire world. Protection against unauthorized use in a particular country depends on the national laws of that country. However, most countries do offer protection to foreign works under certain conditions, and these conditions have been greatly simplified by the aforesaid international copyright treaties and conventions. An underlying idea is the principle of reciprocity, i.e. foreign and national right holders are treated equally. 3 FURTHER ON THE NATIONAL REGULATIONS 3.1 How is copyright obtained? According to the Berne Convention and several other international conventions, literary and artistic works shall be protected without any formal procedure in the countries party to the conventions. In all European Union countries, copyright protection emerges at the same moment as a work is created. Hence, no registration or other formality is needed in order for a work to be protected under copyright law. However, while registration is not needed to exercise copyright, some jurisdictions have established national copyright offices and national laws that allow registration of works for the purposes of, for example, identifying and distinguishing titles of works. In some countries, registration can also serve as evidence in a court of law in disputes relating to copyright. For example, in the United States, the copyright regulation provides several inducements and advantages to encourage copyright owners to register a copyright even though registration is not a requirement for protection as such. A registration may serve as prima facie evidence of a valid copyright and enable the copyright holder to seek statutory damages and attorney's fees. If the registration is done after the infringement, only actual damages and lost profits may be sought.

10 10 Since copyright itself does not depend on any official formalisation the copyright symbol,, does not have a legal function within the European Union. However, in many countries, Great Britain for example, it is recommended to mark a work with the copyright symbol, the name of the copyright owner and the year of publication, in order to let others know when the term of protection started and hence whether it is still covered by copyright. In the United States the copyright symbol has historically served as an important copyright notice. After the U.S. became a member of the Berne Convention it is no longer formally required to use the copyright symbol, though most copyright owners continue to use the notice. Literary and artistic work is deemed to include every original work of authorship, irrespective of its literary or artistic merit. The only criterion used to determine whether or not a work shall obtain copyright protection is that it must be the result of the author s own personal intellectual creativity. In this context, it should be stressed that copyright protection extends only to the personal way in which the author has expressed the content. The protection does not cover the content as such. Consequently, copyright law protects only the right holder against those who copy or otherwise take and use the form in which the original work was expressed by the author. If a work is not unique in the sense that two persons could, independently of each other, express the same ideas, facts, circumstances, etc. contained in the work in the same way, the work will not be protected. This does not exclude, however, that two individuals could create original works, independently of each other. Then both of them will obtain copyrights. 3.2 Authorship and ownership The owner of copyright is generally the person who creates the work, the so called author. Should a work be produced by a collaboration of two or more authors, in which the contribution of each author is not distinct from that of the other authors, it is a work of joint authorship. In a joint authorship the authors can only exploit the work together. Certain national laws provide that when a work is created by an author who is employed for the purpose of creating the specific work, the employer is the owner of the copyright in the work, not the author. As mentioned below, however, the moral rights always belong to the individual who creates the work. An author may choose to transfer the copyright, or aspects of it, to a third party. In such a case the third party will become the right holder. The transfer of rights is further illustrated under Exclusive rights

11 11 Copyright protection grants two types of rights to the author in respect of his or her work. These are called economic rights and moral rights. Both these rights are exclusive, i.e. only the author or his or her successor in title is authorized to carry out any of the acts covered by the rights. The rights apply whether or not the work is in its original form or in an altered manner, such as translated or adapted, another literary or artistic form or in another technical manner Economic rights The economic rights enable the author to control the use of his or her work in a number of ways. The author can prohibit or authorize the work s reproduction in various forms, its distribution of copies, its public performance, its broadcasting or other communications to the public, its translation into other languages and its adaptation. The right to prevent others from making copies of the work without authorization, i.e. the right to reproduction, is the most basic right in copyright legislation. The other rights are recognized in order to ensure that the right of reproduction is respected. The author also holds an exclusive right to authorize others to use the work on agreed terms, see more under 3.6. However, it should be stressed that there are a number of limitations on these economic rights, as is mentioned further below. In recent years, questions on the scope of the economic rights have arisen as a result of the technological development, in particular digital technology and the development of interactive communications. In this regard the WIPO Copyright Treatment, WCT, clarifies in Article 8 that the right to make a work available to the public in such a way that members of the public can access the work from a place and at a time individually chosen by them, shall be covered by the economic rights. Most national laws have implemented this statute as a part of the right of communication to the public, although some have chosen to do so as a part of the right to distribution. Since the rights are vested with the right holders, there seem to be little, if any, practical differences in these approaches Moral rights The economic rights just mentioned aim at giving the author the possibility to make commercial gain from the exploitation of his or her work. The moral rights, on the other hand, protect the personal and reputational right rather than the purely monetary value of a work. The basic moral rights comprise the right of the author to be named as such and identified as the author in the context of any use of the work, which is sometimes called the right of paternity. Further, the moral rights encompass the right to object to any change in the work or to its being made available to the public in a form or in a context that is

12 derogatory to the literary or artistic reputation or individuality of the author, the so called right of integrity. 12 It is worth noting that the moral rights in principle can not be transferred or assigned. The right is accorded to an original creator. Thus, even when for example a film producer or a publisher owns the economic rights in a work it is only the individual creator who has a moral interest at stake. The author can with binding effect waive his or her moral rights, at least in relation to uses which are limited to their character and scope. 3.4 Limitations and exceptions to copyright The expression limitations and exceptions to copyright refers to situations in which the exclusive economic rights granted to authors or their assignees under copyright law do not apply. Hence, regarding certain acts of exploitation, authorization from the right holder is not needed. It should be noted that when a work may be used in accordance with these exceptions, the moral rights of the author must nevertheless be observed. There are several examples of limitations of general interest, such as the right to quote copyright-protected works in accordance with proper usage, provided that the source of the quotation is mentioned. Other examples include use of works for teaching purposes and use of works for the purpose of news reporting. The traditional limitation presented in most copyright regulations that allow individuals to make single copies of works for private, personal and non-commercial use is, these days, the subject of debate. Now that digital technology has made it possible to produce high-quality unauthorized copies of works, indistinguishable from the source, it substitutes the purchase of authorized copies. Hence, the ease and quality of individual copying has led some countries to narrow the scope of such exceptions of the right holder s exclusivity to control the copying of the work. Some countries, for example, have adopted provisions that prohibit copies of computer programs and databases in digital form, for private use. Special limitations in relation to the information society and in particular computer programs are illustrated under In addition to the above-mentioned limitations set out in most national laws, the laws of some countries also recognize the concept known as fair use or fair dealing. The United States is one such example. Fair use allows limited uses of copyright-protected material without requiring authorization from the right holder. However, in order for the use to be legal, factors such as the nature of the used work, the amount of the used work in relation to the work as a whole and the likely effect of the use on the potential commercial value of the work have to be taken into account.

13 Duration of copyright Typically, intellectual property rights, e.g. patents, are protected only for a limited period of time. Once the term of protection has expired, the work may be used freely. The same applies to copyright. Copyright protection does not last indefinitely. The copyright legislation provides for a period of time during which the rights of the copyright holder exists. The period of duration begins from the moment when the work is created, or as in some countries, when the work has been expressed in a tangible form. Within the European Union, the term of copyright lasts from the moment when the work is created, for the lifetime of the author and for 70 years after his or her death. For joint authorships the copyright duration is linked to the death of the last surviving author. If, for any reason, the author is unknown or generally known under a pseudonym, the copyright subsists until the end of the seventieth year after the year in which the work was lawfully made public. 3.6 Neighbouring rights As mentioned in the introduction, alongside the copyright-protected works, the copyright legal framework also provides protection for certain neighbouring rights. 10 These rights are of shorter duration than ordinary copyright-protected works. Generally, the neighbouring rights protection lasts for 50 years after the event that sets the term running. There is no single definition on what constitutes a neighbouring right. Hence, these rights may vary in scope from country to country. The Berne Convention provides that performers, phonogram producers and broadcasting organizations shall be protected as neighbouring rights. Hence, countries bound by this convention shall protect these categories of beneficiaries. In the European Union, film producers and database creators shall also be protected under this branch of the law. The protection of performing artists, such as actors, singers, musicians and other persons who perform literary or musical works, is perhaps the most unified right of the related rights. It is not difficult to accept that a performer has an intellectual input on his or her performance, beyond that of the author of the work. The protection granted to performing artists includes the exclusive rights to prevent a broadcast or communication to the public of his or her performance, unless this is made from a legally published recording of the performance. It also includes the exclusive right to prevent a recording of his or her performance and the reproduction of such a recording. 10 The term related rights can also be used to describe these rights.

14 14 The producer of a phonogram, which is the person who makes the recording rather than the person who performs it, has a right to prevent both direct and indirect reproductions of recordings. In the European Union, the same right also applies to those who produce recordings of moving images. Once a phonogram has been published, neither the producer nor the performing artist can prevent it from being broadcasted. However, fair remuneration to both the producer and the performing artist must be paid. This may be based on either a license agreed between the parties or imposed by law. Broadcasting organizations such as radio and TV organizations are recognized as right holders because of their role in making works available to the public and in light of their interest in controlling the transmission of their broadcasts. Consequently, broadcasting organizations are provided the right to authorize or prohibit re-broadcasting, fixation and reproduction of their broadcasts. In the European Union, producers of catalogues or other compilations which contain a large amount of information or which are the result of a significant investment shall also enjoy protection under the neighbouring rights. This protection is particularly important for databases that do not meet the criteria for copyright protection, e.g. those that lack the element of systematical or methodical arrangement. The neighbouring rights protection covers, for instance, the right to prevent extraction and reutilization of the whole or of a substantial part of the contents of the database. Unlike other neighbouring rights, the protection for databases lasts only for fifteen years from the completion of the database, that is to say the point at which the criterion of substantial investment is fulfilled or from the date at which the database is made available to the public, whichever is the later. Under some national laws, additional rights are granted. In a growing number of countries, performers and producers of phonograms are granted a right of rental in respect of phonograms. Some countries also grant specific rights over cable transmissions. Finally, it should be mentioned that just like copyright, most national laws contain limitations on the related rights. Some countries even allow the same kind of limitations on related rights as for the copyright. For example, the limitations can be in relation to teaching, scientific research, private use and for reporting on current events. 3.7 Transfer of rights Like any other property, a copyright, or aspects of it, can be transferred from the original author to a third party. The ability to transfer some or all of those rights to a third party is even one of the primary benefits of being the owner of a copyright.

15 15 A transfer of copyright is usually either in the form of an assignment or in the form of a license. An assignment of copyright can be compared with the sale of personal property. The original author assigns its copyright to a third party and can no longer exercise control over how the third party uses the work. In such a situation, the author s moral right can not be transferred as a whole. However, in some countries, the moral right may be waived in relation to uses that are limited to their character and scope. A license is an agreement where the author maintains its ownership of the rights, but authorizes a third party to carry out certain acts that are covered by the economic rights. A license is often limited to a specific period of time and for a specific purpose. A license may be exclusive, i.e. the copyright owner agrees not to authorize any other party to carry out the licensed acts, or non-exclusive, which means that the copyright owner may authorize others to carry out the same acts. A licence does not generally convey the right to authorize others to carry out acts covered by the license. Licensing may take the form of a collective administration of rights. Under a collective administration of rights, authors and other right holders grant exclusive licenses to a single entity that acts on their behalf to grant authorization, to collect and distribute remuneration and to prevent and detect infringements. The collective administration of rights assists, for example, artists to make sure that mass uses and public uses take place on the basis of authorization only. Normally, transfer of a copyright is made by contract. As a general rule, the contract shall clearly specify the transferred right and the transferred powers. Regarding transfer of copyright in certain specific cases, special legal provision may have to be applied. Such may be the case for example regarding publishing contracts and film contracts. A right holder may also choose to abandon his or her right to exercise the copyright, either wholly or partially. A right holder may, for example, post copyright-protected material on the Internet and leave it free for anybody to use. In fact, some organisations and projects have even made it to their business model to make right holders abandon their copyright and leave their work free for others to use but with the condition that the users adhere to special terms in a license. One such example is the General Public License, GPL, and the Open source movement which has specialized in creating computer programs. 3.8 Obligations as to technological measures Encryption and various other measures are frequently used by copyright holders to protect a work from being used without permission. However, circumvention and manipulation of

16 16 such measures are frequent. The Infosoc-directive contains provisions seeking to protect technological measures, technology devices and other components that are designed to restrict or prevent certain acts which are not authorised by the right holder. Consequently, all member states must provide adequate legal protection in this regard. The protection may be civil, criminal or a mix of the two. The member states must also provide adequate legal protection regarding manufacture, import, sale, lease or possession of such circumventing devices. Digital rights management information is similarly protected in the directive. It should be noted though, that technological measures are only protected if they are effective, i.e. they have been successfully implemented. A simple password is considered to be effective enough, irrespective of the ease with which it may be cracked. Further, a copyright holder who protects his or her work by technological measures must allow reproduction that is permitted under the regular limitations to copyright protection, e.g. within the scope of private use. 3.9 Protection of computer programs Copyright or patent? In the 1970s and 1980s there were extensive discussions on whether the patent system, the copyright system, or a sui generis system, should provide protection for computer programs. These discussions resulted in the generally accepted principle that computer programs shall be protected by copyright, whereas apparatus using computer software or software-related inventions shall be protected by patent. Copyright law and patent law provide different types of protection for intellectual property rights. Whereas copyright is a right given to a creator for his or her literary and artistic works, patent is an exclusive right granted for an invention, which is a product or a process that provides a new way of doing something or offers a new technical solution to a problem. As opposed to copyright, patent is generally granted only after completing an examination procedure by a government agency. Copyright protection of computer software is established in most countries and harmonized by international treaties and EC directives. The law relating to the patentability of software is however still not harmonized internationally; some countries have embraced the patentability of computer software and others have adopted approaches that recognize inventions assisted by computer software as protectable under patent law.

17 17 Within the European Union, the European Patent Office, EPO, and national patent offices have issued several patents for inventions involving software since the European Patent Convention, EPC, came into force in the late 1970s. Article 52, EPC, excludes programs for computers from patentability to the extent that a patent application relates to a computer program as such. This has been deemed to imply that any invention which makes a nonobvious technical contribution or solves a technical problem in a non-obvious way is patentable, even if that technical problem is solved by running a computer program. In the United States, patents have been granted to what may be referred to as software patents since the early 1970s. The recent expansion of the Internet and electronic commerce has even led to many patents being applied and granted for business methods implemented in software. This is not, however, thus far possible within the European Union Further on the copyright protection of computer programs As mentioned under , the directive on computer programs 11 states that, within the European Union, computer programs shall be protected under copyright law as literary works. Like all other copyright-protected works, a computer program shall be protected if it is original in the sense that it is the author's own intellectual creation. No other criteria shall be applied to determine its eligibility for protection. This results in most computer programs being copyright-protected, but the scope of the protection might be limited. Copyright protection of a computer program covers only the expression of the program, not the ideas, facts or principles that underlie the elements of the computer program, including those that underlie its interfaces. The expression of a computer program includes elements such as the literal code, i.e. the source code and the object code, as well as the preparatory design material. Whether the protection of the copyright extends beyond the literal code to look and feel and structure, sequence and organization is uncertain. In various court cases, judges have been struggling with the distinction between "expression" and "idea" in computer programs. To date, however, the legal position remains unsettled. The term look and feel is used in descriptions of products to signify the experience a person has using a product and the main features of its appearance and interfaces. Look and feel applies to different types of products. Regarding computer programs and software design, look and feel is used in respect of graphical user interfaces. It comprises aspects of the program s design, including elements such as colours, shapes, layout and typefaces (the "look"), as well as the behaviour of elements such as buttons, boxes and menus (the "feel"). Look and feel in computer programs serves two general purposes. First, it provides branding, helping to identify a set of products from one company. Second, it increases ease 11 Council Directive 91/250/EEC of 14 May 1991 on the legal protection of computer programs.

18 of use since users will become familiar with how one product functions and can translate the experience to other products with the same look and feel. 18 Apple Computer has tried to assert copyright over their look and feel in reference to their Mac OS operating system. 12 The firm tried, with some success, to block other software developers from creating software which had a similar look and feel. Apple argued that it had a copyright claim on the look and feel of its software, and even went so far as to sue Microsoft and Hewlett Packard, alleging that the Windows operating system was illegally copying look and feel to which Apple had the copyright. Although provoking an intense reaction in the software community, the expected landmark ruling never happened. The issues were instead resolved by a license that Apple granted Microsoft for Windows. The case of Whelan Associates, Inc v. Jaslow Dental Laboratory, 13 dealt with the question whether copyright encompasses a program s source and object code only, or whether copying the structure, sequence or organization of a program also might amount to an infringement. The Court found that Ms. Whelan had spent a tremendous amount of time studying Jaslow s Lab, organizing the modules and subroutines for the Dentalab program and working out the data arrangements. A comparatively small amount of time was spent on coding the Dentalab program. Consequently, the court found that copyright protection of computer programs may extend beyond the program s literal code to their structure, sequence, and organization. Shortly after the ruling, the Court's analysis was criticized by the Second Circuit Court of Appeal, for showing a flawed understanding of a computer program's method of operation. 14 Mainly, the criticism was based on the fact that the Court made the assumption that there was only one idea in a computer s program, whereas in reality, a program consists of a number of ideas, expressed in various subroutines. Even though the Circuit Court concurred with the lower court s conclusion that copyright can be infringed even if no literal code is copied, the Court introduced a three-step test to help solve these types of cases. The three-step test aims to determine the similarity of two computer programs. The process first describes the two programs at various levels of abstraction, then, at each stage, filters out the elements that are not subject to copyright. Finally, it compares the results. Nowadays, most courts try to follow this procedure, even though it can be complex and highly subjective Limitations with regard to the exclusive rights Like all other copyright-protected works, copyright on a computer program grants the right holder an exclusive economic and moral right to the computer program. However, within 12 See Apple Computer Inc. v. Microsoft Corporation, 35 F.3d 1435, 9 th Cir See Whelan Associates, Inc. v. Jaslow Dental Laboratory, Inc. 479 U.S (1987). 14 See Computer Associates International v. Altai, Inc. 982 F.2d 693 (2d Cir. 1992).

19 the European Union, there are certain limitations in respect of these rights, regarding certain uses. 19 The making of a back-up copy by a person who has the right to use a computer program may not be prevented by contract, insofar as it is necessary for that use. This so called right to observation is stated in the directive on computer programs, Article 5. The person that has a right to use a copy of a computer program shall be entitled, without the authorization of the right holder, to observe, study or test the functioning of the program in order to determine the ideas and principles which underlie its elements. This can only be done while performing acts of loading, displaying, running, transmitting or storing and on the condition that he is entitled to do so. Further, the directive on computer programs also explicitly provides for a right to decompile a computer program, a limitation that is much-disputed. Article 6 permits decompilation if a number of conditions are met. First, the decompiler must have a license to use the program to be decompiled. Second, decompilation must be necessary to achieve interoperability with a target program or other programs. The necessity must be proven by the decompiler. And third, the decompilation process must, if possible, be confined to the parts of the target program relevant to interoperability. The purpose of this limitation is primarily to provide an incentive for developers to document and disclose all information that is requested to obtain interoperability with other projects Escrow of source code The use of computer software presupposes that the user can control the functionality of the software and avoid the risk of costly interruptions in the use of the technology. However, to be able to control the functions of the software, access to the software s source code will be needed. Due to the risk of unauthorized use, software developers are often reluctant to reveal the source code to the software end-users. Instead, source code escrow is often used as a business model. Source code escrow protects both the rights of the software end-users and the valuable, proprietary technology of the software developers. Typically, an escrow agreement is of importance when a software developer is retained for a specific project. The client then has a special interest in securing the use of the software he has paid for. Placing source code in escrow is most commonly used if the software is business-critical, costly, or if there is an absolute need to protect against interruptions in order to enable the software to go forward. Escrow of source code originates from the United States and was introduced about 20 years ago. In the past, software escrow was merely the physical storage of the source code in a vault. These days, however, the escrow is a bit more advanced. Typically, a physical copy of the source code of the software is deposited into an account held by a neutral third party, a

20 so called escrow agent. The escrowed technology is stored in a media vault facility. Since the technology may degrade over time, the escrow agent usually offers an environment which protects both the integrity of the technology as well as provides security and protection of the critical intellectual property. 20 The highly valuable, and thus often secret, source code is released by the agent to either party only upon specific terms stated in the escrow agreement, executed between the parties. The escrow agreement should define the deposit materials to be escrowed and the explicit terms upon which the source code can be released. Such terms may be failure to maintain the application, transfer of ownership of the intellectual property right, or the liquidation of the owner of the source code. The arrangement of escrow provides the software end-users the assurance of access to verified source code and associated documentation. Through this arrangement, source code can also be analysed to ensure a high level of confidentiality. Further, in accordance with the agreed frequency, active follow-up of deposits of updates and new releases can be safeguarded. 4 CONTRACTUAL RELATIONS 4.1 Employer/employee Copyright is often created in the course of employment. The employee is assigned to create a computer program, newspaper articles, etc. For this he receives salary and other benefits. Generally in such relations the employer obtains the right to use all results from the work done by the employee, regardless of whether the result is copyrightable or not. In some jurisdictions there are limitations regarding the right of the employer to use the result. Such a limitation could be that the result may only be used within the natural and foreseeable scope of the employer s enterprise. It is possible to regulate all issues regarding the use of an employee s copyrightable work in an employment agreement. Such agreement could be individual and/or collective. 4.2 Work for hire A work that results in something copyrightable, such as a computer program, is often ordered or commissioned. Here, the commissioner or the purchaser gives a specific assignment to a person or a group of persons, often a company, aiming at a specific result. The purchaser also may provide specific documents, experience and resources as a contribution to the result and in order to enhance the work performed by the commissioned

21 21 party. In such relations it is customary that the issues regarding the use of the copyrightable material are regulated in a rather comprehensive way. Such regulations could contain the context in which the commissioner, the purchaser, may use the work, exclusivity, the right to amend the result, etc. 4.3 Licensor/licensee Instead of transferring rights, a licence is often used as a tool for regulating the authorized use of a copyright-protected work. Such licensees can be extremely elaborate or very simple. An example of a very simple license is when the right to use a standard computer program is obtained. The license, which typically is unlimited in time, gives the licensee the right to use the computer program on a specific computer, in a network, etc. The license does not permit any other commercial use of the computer program or its being made available in any form or fashion. 4.4 Some general considerations regarding transfer of rights One initial issue is the subject matter of the transfer, i.e. finding out what the technology is and what part of it is needed for the purchaser. A second issue is to regulate the scope of the rights to be obtained. Here you identify territorial boundaries as well as restrictions in time and technology. Not least important is the fee for using the work in question. Coupled with that is how the fee will be paid. The purchaser will want to be sure that he really receives all the rights expressed by the vendor/licensor. This could include warranties as to the originality and that the vendor really has all necessary rights as well as undertakings regarding future releases and new versions. It is clear that agreements in this field can be complicated. 5 FILE SHARING Internet technology is under rapid development. Over the past few years we can see that the file sharing technology dramatically has changed the way copyright-protected materials, including digital music, videos, software and images can be exploited and distributed. File sharing allows people worldwide to share, i.e. to upload and download, files and data over the Internet. It allows perfect copies and easy distribution. At low cost and on a large scale,

22 perfect copies of phonograms, films and software are being exploited every day. A significant proportion of the material shared over the Internet is subject to copyright and shared without the consent of the right holder. This has resulted in a delicate problem for most countries legislators and judicial authorities. 22 The debate on file sharing s right or wrong is a virtually global phenomenon. Within the European Union, copyright and other intellectual property rights are recognized as an integral part of property. The investments required to produce products such as phonograms, films and multimedia products, are considerable. The file sharing debate has not merely an economic side to it. It also has a social and developmental dimension. Copyright and related rights provide an incentive for the creation of and the investment in new works and their exploitation, thereby contributing to improved competitiveness, employment and innovation. In fact, if right holders were not to receive an appropriate reward for the use of their work, some people even argue that the future existence of artistic and literary works might be threatened. Hence, the debate on file sharing is associated with many aspects, economic as well as cultural, social and technological, all of which have to be taken into account when formulating a sustainable policy in the field. A common issue in the file sharing debate is whether or not the laws regulating file sharing and its enforcement are sufficient. Already in 1996 the WIPO copyright treaty, WCT, laid down principles of worldwide enforcement of copyright in national law in response to the technological developments. In the European Union this has been recognized by the adoption of several directives, in particular the Infosoc-directive with its distinct focus on the information society. The general tendency throughout the world has been to enforce copyright and to adapt its protection with respect to the developments of digital technology. This has been done in slightly different ways in different countries. Consequently, there are some variations in the national laws on copyright regarding the enforcement of copyright in connection with file sharing. One thing is clear though: a major problem with the legislation regulating the issue is the rapid development of new file sharing techniques and the evolvement of these techniques in response to the legal amendments. The legislators and judicial authorities are facing considerable problems in this regard. Even so, from one essential aspect most regulations are unanimous: individuals who are sharing files of copyright-protected works over the Internet without consent of the right holder are liable of copyright infringement. Within the European Union, this is stated in the Infosoc-directive, Article 3, section 1. The article states that all member states of the European Union shall provide authors with the exclusive right to authorize or prohibit any communication to the public of their works, by wire or wireless means. The expression by wire or wireless means is deemed to include both regular distribution and digital distribution. Hence, all forms of digital distribution, including file sharing of copyright-

23 protected works over the Internet, constitute a communication to the public and thus, due consent from the right owner is needed. 23 In recent years, we have seen several copyright owners challenging file sharing, leading to lawsuits against owners of file sharing networks as well as private individual file sharers all across the world. Industry representatives, for example, are businesses with obvious economic dependence upon copyright. In addition to prompt extension and expansion of their copyrights they have also participated in law suits to protect and enforce their rights. In some countries, legal actions have also been taken against Internet service providers, ISPs, for their role as intermediaries. The Infosoc-directive states in Article 8, section 3, that all member states shall ensure that the right holders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe a copyright or related right. Yet, only a limited number of member states have implemented the article in their national legislation. In the other states, the scope of the article falls under the already existing national legislation. The provision is much disputed and interpreted differently in different countries. In some countries, the legal position on the matter is not even fully established. In Denmark there are several rulings concerning ISPs liability as intermediaries. For example, the Danish Supreme Court ordered on February 10, 2006, an ISP to cut off the Internet connections to customers who infringe copyright. 15 As a result, ISPs are now required to act instantly upon notification that one of their customers is using their Internet account to infringe copyright. In a more recent case from 2008 an ISP in Denmark was found to be contributing to copyright infringement and was ordered to block any access to the notorious file sharing website The Pirate Bay. 16 In the crackdown on illegal file sharing in Italy, a pre-emptive seizure order in August 2008 required Italian ISPs to block access to The Pirate Bay. However, a couple of months later, the block was overturned and the website is once again accessible in Italy. Although The Pirate Bay has had one judicial victory in Italy, the site still faces legal challenges in Sweden and across the rest of Europe. Despite the various above-mentioned legal actions and legislative amendments it seems that incentive enough for each individual to stop illegal file sharing is lacking. In fact, some people even argue that the problem is not the legislation per se but rather the fact that the legislation is ignored by the vast majority of people whom it is principally intended to govern. In Sweden, the government recently formally presented a legislative proposal for a 15 TDC Totallosinger A/S v IFPI Danmark, KODA, Nordic Copyright Bureau, Dansk Musiker Ford, Dans Artist Forbund, DAnish Supreme Court, 10 February 2006, case No 49/ DMT2 A/S v IPFI Danmark, Retten på Frederiksberg, 29 January 2008, case No 14324/2007.

24 new file sharing law designed to make it easier to track people who illegally download copyright-protected materials. The bill, based on the Enforcement-directive, would give copyright holders the right to seek a court order requiring ISPs to divulge the names of individuals linked to IP-addresses through which the illegal downloading occurs. Even though the Swedish bill is not unique, it has been much disputed with respect to integrity issues. 24 Overall, file sharing has changed the way right holders relate to their work and to their potential customers and legislators and businesses are trying to take a new approach. In this regard it should be mentioned that parallel to the illegal file sharing, a legal market of downloading of music and film is developing and increasing. The supply of legal alternatives increases not only on the Internet but also over mobile networks and other recent techniques. Both the film and music industries are constantly looking for services that are in demand. However, the development of the legal market is very much dependent on the regulation of copyright. In order to combat the illegal file sharing of copyright-protected works and to formulate a sustainable policy on file sharing in the future, there is a need to improve the legislation to deal more effectively with the problem. Efforts to encourage more effective enforcement of the existing legislation is also important, as is education and information to the people on file sharing s social, economic and cultural consequences. 6 INTERNET SERVICE PROVIDERS AND COPYRIGHT A relevant question in many jurisdictions is whether Internet service providers, ISP, bear any liability for such copyright infringement that occurs when the services are being used. It seems clear that an efficient enforcement of sanctions against copyright infringement on the Internet would be considerably enhanced, should the ISPs be made liable for such infringements. They would then have the incentive to block web sites and users, such as those who share files containing film, music, etc. without the consent of the right holders. Regarding intermediaries the Infosoc-directive states as follows: 1. Member States shall provide appropriate sanctions and remedies in respect of infringements of the rights and obligations set out in this Directive and shall take all the measures necessary to ensure that those sanctions and remedies are applied. The sanctions thus provided for shall be effective, proportionate and dissuasive. 2. Each Member State shall take the measures necessary to ensure that right holders whose interests are affected by an infringing activity carried out on its territory can bring an action for damages and/or apply for an injunction and, where appropriate, for the seizure of infringing material as well as of devices, products or components referred to in Article 6(2). 3. Member States shall ensure that right holders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe a copyright or related right.

25 25 The scope of the above provisions is debated, for several reasons. One reason is that activities from an intermediary related to observation of the content of the material that is being transferred, would attack the integrity of the users. A counterargument to such reasoning is that any enforcement against criminal behaviour could be viewed as a restriction on somebody s integrity. From a copyright point of view, the difficulties of establishing a liability for an intermediary lie in the concept of copyright protection. The exclusive right vested with the right holder is the right to make copies and the right to make a protected work available. Only such actions that would constitute copying or making available can thus be regarded as copyright infringement. An intermediary could, at least typically, argue that the intermediary does not make any copies, nor is it the intermediary that makes the work available; it is the user. Furthermore the intermediary has, again typically, not encouraged any illegal use of copyright-protected material, nor has it provided any specific tools for such activities. It is also in the nature of copyright infringement that it regards specific works, not a general behaviour. Thus, copyright infringement can only be successfully prosecuted or form the basis of a civil complaint, when it addresses a specific work belonging to identified right holders. Nevertheless, regardless of these restraints on the possibility to hold intermediaries liable for copyright infringement, there seem to be reasons to oblige ISPs to take a greater responsibility in the pursuit of enforcing copyright protection. Only when illegal use, which is depriving right holders, producers, TV-channels and others, is minimised can the right holders profit from their creations, work and investments, and only then will it be possible to really develop efficient and economically sustainable legal alternatives. 7 CONCLUDING REMARKS Copyright in its present form was developed during the first part of the 20 th century. Despite the technical development the essential elements in what is protected and in which way the protection is secured, remains the same. Over the years there have been several amendments, both internationally and in national laws, in order to adapt the copyright system to new technology and new behaviour. Copyright protection has been regarded, and continues to be so, as an indispensible instrument to ensure creation of new work and relevant marketing of such works. Only if creators, producers and investors are guaranteed protection by an efficient copyright system, will they continue to make new works available for the audience, who will then benefit culturally and socially from new books, new films, new music, new computer programs, etc.

26 26 It is clear, however, that there will be new ways of financing and paying for the use of copyright-protected material. We have already seen several such solutions, e.g. co-operation between right holders and telecom companies, where a subscriber to a mobile service, also can subscribe to the availability of a music catalogue. Not only will the price be of essence for such services, but also the technical devices that will protect the right holder from exploitation beyond the licensed scope, will be of importance. For those involved in the development of new technology for the information society, a major concern should be ways and means of securing copyright. Otherwise there is a clear risk that there will be little new content to distribute.

27 8 MARKETING ON THE INTERNET In General When it comes to the information society, the Internet has brought many unique benefits to marketing. Marketing over the Internet is relatively inexpensive compared to regular marketing channels. Companies can reach a wide international audience for a small fraction of traditional advertising budgets. Further, the nature of the medium allows consumers to research and purchase products and services at their own convenience. The interactive nature of Internet marketing, both in terms of providing instant response and eliciting responses, is also a unique quality of the medium. While distribution of information and media to a global audience is one of the most vital benefits of Internet marketing, it also gives rise to several problems. For a long time], many national marketing laws have merely been applicable to marketing acts that level against that specific country s public, irrespective of where the marketing has its origin. Since Internet has no clear borders and reaches a global audience this has created several jurisdictional problems. After the adoption of the directive on electronic commerce, however, the abovementioned territorial principle shall no longer be applicable concerning marketing over the Internet. Instead, marketing over the Internet is, in principle, subject to the law of the member state in which the service provider is established. In turn, the member state in which the marketing is received cannot restrict incoming marketing except under strictly limited circumstances and subject to a specific procedure laid down in the directive. In general, market law is a field of the law where the member states of the European Union have for a long time had their own distinct laws. One major reason for this is the different approaches to what constitutes taste and decency in various countries. The distinct laws on marketing and advertising practises have, however, led to discrepancies between the countries and difficulties within the internal market. When the first efforts for a harmonization were made in the 1960s, unfair practises in business to business transactions were the main focus. Since then, the focus has, from time to time, shifted between consumer protection and protection from unfair commercial practices between businesses. Directive 84/450/EEC 17 concerning misleading advertising was the first directive in the field. The directive was amended in 1997 so as to include comparative 17 Directive 84/450/EEC of 10 September 1984 relating to the approximation of the laws, regulations and administrative provisions of the Member States concerning misleading advertising.

28 advertising. 18 In 2006, the two directives were consolidated through directive 2006/114/EEC 19 in order to merely regulate commercial practices between businesses EC Directive on good marketing practice Lately, the European Union has strengthened the policy on consumer protection. In this regard, a directive with special emphasis on the confidence of European consumers in crossborder transactions was adopted in The so called unfair commercial practices directive 20 was passed to harmonize the laws of the member states on unfair commercial practices, including unfair advertising, which directly harm consumers economic interests and thereby indirectly harm the economic interests of legitimate competitors. The aim of the directive is to give consumers the same protection against unfair practices and rouge traders whether the purchase is from their corner shop or from a website based abroad. The directive does not cover or affect national laws on unfair commercial practices which harm only competitors economic interests or which relate only to transactions between businesses. Consequently, member states are continuingly able to regulate such practices, in conformity with other community law, if they choose to do so. The directive is technology-neutral and thus applicable to unfair advertising in any media. It should be noted that the directive does not regulate any questions on taste or decency although there are great differences on how such matters are looked upon within the member states. Obviously the possibility, or maybe willingness, to harmonize taste and decency is limited. The directive contains a general clause that constitutes a general ban on unfair commercial practises. This provision replaces all member states existing, divergent general clauses. Because of the clause s general wording, it will be able to evolve in line with new technology and the market itself. In addition, two main categories of unfair commercial practices, misleading and aggressive practices, are described in more detailed general clauses. The general clause on misleading practises in Article 6 states that a commercial practice shall be regarded as misleading if it contains false information and is therefore untruthful or in any way, including overall presentation, deceives or is likely to deceive the average consumer, even if the information is factually correct, in relation to one or more of the following elements, and in either case causes or is likely to cause him to take a transactional decision that he would not have taken otherwise: 18 Directive 97/55/EC of European Parliament and of the Council of 6 October 1997 amending Directive 84/450/EEC concerning misleading advertising so as to include comparative advertising. 19 Directive 2006/114/EC of the European Parliament and of the Council of 12 December 2006 concerning misleading and comparative advertising. 20 Directive 2005/29/EC of the European Parliament and of the Council of 11 May 2005 concerning unfair business-to-consumer commercial practices in the internal market and amending Council Directive 84/450/EEC, Directives 97/7/EC, 98/27/EC and 2002/65/EC of the European Parliament and of the Council and Regulation (EC) No 2006/2004 of the European Parliament and of the Council (Unfair Commercial Practices Directive).

29 (a) the existence or nature of the product; (b) the main characteristics of the product, such as its availability, benefits, risks, execution, composition, accessories, aftersale customer assistance and complaint handling, method and date of manufacture or provision, delivery, fitness for purpose, usage, quantity, specification, geographical or commercial origin or the results to be expected from its use, or the results and material features of tests or checks carried out on the product; (c) the extent of the trader s commitments, the motives for the commercial practice and the nature of the sales process, any statement or symbol in relation to direct or indirect sponsorship or approval of the trader or the product; (d) the price or the manner in which the price is calculated, or the existence of a specific price advantage; (e) the need for a service, part, replacement or repair; (f) the nature, attributes and rights of the trader or his agent, such as his identity and assets, his qualifications, status, approval, affiliation or connection and ownership of industrial, commercial or intellectual property rights or his awards and distinctions; (g) the consumer s rights, including the right to replacement or reimbursement under Directive 1999/44/EC of the European Parliament and of the Council of 25 May 1999 on certain aspects of the sale of consumer goods and associated guarantees, or the risks he may face. A commercial practice shall also be regarded as misleading if, in its factual context, taking account of all its features and circumstances, it causes or is likely to cause the average consumer to take a transactional decision that he would not have taken otherwise, and it involves: (a) any marketing of a product, including comparative advertising, which creates confusion with any products, trade marks, trade names or other distinguishing marks of a competitor; (b) non-compliance by the trader with commitments contained in codes of conduct by which the trader has undertaken to be bound, where: (i) the commitment is not aspirational but is firm and is capable of being verified, and (ii) the trader indicates in a commercial practice that he is bound by the code. 29 In this regard it should also be stressed that a commercial practice shall be regarded as misleading if in its factual context, taking account of all its features and circumstances and the limitations of the communication medium, it omits material information that the average consumer needs, according to the context, to take an informed transactional decision and thereby causes or is likely to cause the average consumer to take a transactional decision that he would not have taken otherwise. The general clause on aggressive marketing in Article 8 states that a commercial practice shall be regarded as aggressive if, in its factual context, taking account of all its features and circumstances, by harassment, coercion, including the use of physical force, or undue influence, it significantly impairs or is likely to significantly impair the average consumer s freedom of choice or conduct with regard to the product and thereby causes him or is likely to cause him to take a transactional decision that he would not have taken otherwise. Article 9 further states that in determining whether a commercial practice uses harassment, coercion, including the use of physical force, or undue influence, account shall be taken of: (a) its timing, location, nature or persistence; (b) the use of threatening or abusive language or behavior; (c) the exploitation by the trader of any specific misfortune or circumstance of such gravity as to impair the consumer s judgment, of which the trader is aware, to influence the consumer s decision with regard to the product;

30 (d) any onerous or disproportionate non-contractual barriers imposed by the trader where a consumer wishes to exercise rights under the contract, including rights to terminate a contract or to switch to another product or another trader; (e) any threat to take any action that cannot legally be taken. 30 The vast majority of practices which would be considered unfair fall under these abovementioned provisions. When applying the above-mentioned provisions, the practices shall be assessed in light of the effect they have, or are likely to have, on the average consumer. Further, the directive outlines sharp practices that shall, in all circumstances, be regarded as unfair and thus prohibited throughout the European Union. These provisions are stated in the so called Black list. The situations listed in the Black list are prohibited per se and can be applied without having an effect on the average consumer. The member states are supposed to have implemented the directive by the end of 2007, and even though there is some room for national interpretation, the basis of the national law within the European Union, are nowadays the same in the field of market law. 8.3 Search engines, marketing and copyright Search engines provide a particular problem from a marketing law and a copyright law perspective. Through a search engine, it is possible to collect information on a specific topic, without actually visiting the web site where the information appears. This means, among other situations, that somebody who has e.g. a site where advertisements for cars, housing, furniture, etc. are disseminated and who actually markets this service, may be deprived of visitors to his site through search engines and linking directly to the particular advertisement. At least in Sweden this behaviour has been judged by the court not to constitute a violation of the Marketing Act. Whether such activity as the one just described would constitute a copyright infringement, could be dependent on whether unauthorized copies would be made in the process or the activity involves unauthorized making available. The latter seems unlikely, since the advertisement has been lawfully available on the Internet. If there really is a mere linking to the site, without any copies being made, it could be argued that only the intended availability occurs. In this context it should be mentioned that such services that some of the major search services, e.g. Google, provide typically would involve the making of copies, and thus be dependent on consent from the right holder. That would be the case when for example a newspaper article is retrieved through the search engine.