Foreign experts recommend suggestions of Twinning project are included in the bill on collective management of copyright and related rights

The bill doesn’t meet international standards and it contains serious corruption risks, claim the experts.

The bill on collective management of copyright and related rights should be improved by basing it on the Twinning project, this version of the bill has been considered as a basis since the very beginning. Bill No.4461, currently proposed by the government, is contrary to European and international standards. Therefore, it is not acceptable. “To find a solution, we need an extensive public dialogue involving all stakeholders.” This opinion was expressed by the representatives of European and American expert associations at a discussion held at Ukraine Crisis Media Center.

Position of the authors
According to representatives of this sphere, the bill provisions are contrary to modern international standards to such an extent that its adoption may lead to excluding Ukraine from the International Confederation of Authors and Composers Societies (Fr. CISAC). “This bill is destructive and does not meet requirements of the Cabinet. […] It does not include 80 percent of what the Directive requires, so we insist on its withdrawal,” stated Sergiy Haletiy, member of the National Union of Cinematographers of Ukraine, expert of the “Culture” group at Reanimation package of reforms.

The principal shortcoming of the bill is that it offers a monopoly model
“I consider monopoly model absolutely false. I do not know how they are going to restrict my right to create another organization or to join another author organization. This is a violation of my basic freedom,” said Taras Tkachenko, film director, chairman of the National Union of Cinematographers of Ukraine.

Representatives of authors noted that a single organization for the collection, distribution and payment of royalties will not only hinder an individual approach to each author from different areas, but will also create serious corruption risks. According to Sergiy Trymbach, film critic, film historian, writer, it will turn into “another corporation” and will lead to the decline of the industry. “We will have what we have always had – that the authors will receive just a few pennies,” he believes. There will also be questions about the transparency of the distribution / payment of so-called unidentified funds – they may not reach the author.

Volodymyr Gronskiy, composer, director of collective management organization “Cinema”, reminded that three UACRR (Ukrainian Agency of Copyright and Related Rights) directors had been dismissed over the last nine years for embezzlement, and none of them was brought to justice. In his view, a single organization will further “protection racket” of major TV channels, which are the main non-payers of royalties.

According to him, 90 percent of copyright funds are in the shadow currently. “For comparison, in Lithuania, with a population slightly more than half of Kyiv, audiovisual industry alone gathers more than EUR 6 million. This is six times more than our largest organization,” he said.

Sergiy Trymbach noted that no European country, except for those small ones, such as Estonia, has such monopoly. He also suggested that a particular interest group is already lobbying for the bill. “There is no bill yet, but the government is already working on its implementation. This “corporation” is operating and “pushing” the advantageous laws and patterns of financial flows,” he stated.

According to representatives of authors, successful reform in this area requires broad public discussion of all the issues. So far, they say, all appeals to the parliamentary committees have remained unanswered. “We need a nationwide dialogue and joint efforts of all its participants. And this applies not only to amending the Law on Copyright and Related Rights, which has a lot of gaps, but also to the Law on OKU (Collective Management Organizations), and they must be approved and implemented simultaneously. Without such a tandem the system will not work,” said Volodymyr Gronskiy.

Government’s position
“Now in cooperation with UACRR (Ukrainian Agency of Copyright and Related Rights) we are introducing the effective model that exists in Europe, based on the principles laid down in European Union law,” stated Bogdan Paduchak, Deputy Director of the Department of Innovation and Intellectual Property, Ministry of Economic Development and Trade of Ukraine. “The main component of bill 4461 supported by the Ministry is the introduction of an automated system of collecting and paying royalties. This will increase transparency,” he added.

He noted that the bill was adopted in accordance with the regulations of the Cabinet of Ministers. According to him, the MEDT analyzed the bill and gave the law drafters their comments and suggestions. “They also noted that the current provisions of the bill should be supplemented with other requirements under the EU […] Directive, and only then the Ministry of Economic Development and Trade will support it,” said Bogdan Paduchak.

He added that now, after a change of management, royalty revenues at UACRR “have increased multi-fold.” Besides, transparency has increased in accordance with the EU requirements. “Reports have already been posted on the UACRR website. There is also information about incoming and outgoing cash flows,” he added. However, he said, “18 existing organizations do not conduct their main activities and do not show any results the authors deserve.”

Foreign experts’ position
“The US government does not agree with this bill. And we agree with the EU position that does not support the bill either. […] The creation of such anachronistic monopolistic system of collective management contradicts the global norms of collective management and international standards,” stated Donald Taunsen, Regional Attaché of intellectual property rights. He reminded that the bill would comply with the Directive on collective management of copyright and related rights (CRM Directive), as required by the Association Agreement. This was emphasized during the meetings of the highest officials in Brussels and Washington. On August 28, the European Commission even sent a letter with comments on bill 4461 to the Cabinet of Ministers. “If it is adopted, we will require to review it, and, moreover, we will in no way support implementation of this law, including financially,” he stressed.

Donald Taunsen reminded that international experts within the Twinning project have helped develop a bill that would fully comply with the above requirements. “The EU considers bill 4461 as an alternative to the bill drafted by European experts under the Twinning project. In our numerous communications with the government and parliament we conveyed this position many times – said Oksana Popruga, representative of the EU Mission. We offer the following solution: to take the Twinning bill as a basis and to draft the governmental bill. We also hope that it will be supported by the Parliament and adopted rapidly to reform the sector as soon as possible.” She added that experts are ready to continue its improvement and waiting for the MEDT response to the proposal of the European Commissioner.