Public policy and the in-house lawyer

"Laws, like sausages, cease to inspire respect in proportion as we know how they are made." (John Godfrey Saxe)

I've been working in-house now at the Financial Times for three years, having spent the previous 16 years of my career in private practice. It's been a hugely enjoyable career change, for many reasons. Some of these have been what I expected: greater closeness to one's client, for example. One of the more unexpected, in recent months, has been the chance to get involved in a process aimed at changing the law, rather than just advising on what the law is.

On 23 March, the European Commission launched a public consultation on the role of publishers in the copyright value chain in preparation for introducing a new law extending copyright protection to publishers alongside other rights owners in the “value chain”, such as authors, broadcasters and film producers (see Legal update, European Commission consults on neighbouring rights for publishers and panorama copyright exception).

This article gives a brief overview of the proposed "publishers' right" and why it's being proposed, describes my own involvement in the process, and discusses what this says about the contribution in-house lawyers are able to make to public policy issues affecting their employers.

The challenges faced by news publishers today are well known, and have been vividly demonstrated in recent weeks by the closure of the print editions of The Independent and The Independent on Sunday. Publishers face increased competition for people's attention, and a decline in print revenues as both audiences and advertisers move online. Revenues from digital advertising have failed to offset the loss of print advertising, not least because so much advertising spend has gone to dominant platforms with vast audiences, such as Google and Facebook.

It's not all doom and gloom, though. The growth of digital media has brought with it a huge increase in people's interest in, and appetite for, news. The Financial Times now has the biggest paid audience in its history, and the potential for further growth was demonstrated by the willingness of Nikkei to pay £843 million for us last year. Other news organisations, such as The Economist and Business Insider, have also attracted substantial investment in the past 12 months.

These challenges and opportunities for news publishing have, however, highlighted the underlying weaknesses in publishers' legal positions. No longer protected by the barriers to entry of setting up expensive print operations, publishers have become increasingly dependent on the rights in their content. These rights, though, can be far from clear.

The cornerstone of current EU copyright law is the InfoSoc Directive (2001/29/EC) (officially the Directive on the harmonisation of certain aspects of copyright and related rights in the information society; also known as the Information Society Directive or the Copyright Directive), adopted in 2001. The InfoSoc Directive defined the three main "exclusive rights" which comprise copyright:

It then required EU member states to confer these rights on people at various points in the value chain:

Conspicuously absent from that list are publishers, perhaps reflecting a view that the role of publishers was historically more practical and logistical in nature: printing and distributing works that other people had created, rather than being creative forces themselves. Whatever the reason, publishers have been left to rely on the underlying copyright in individual articles, which in many cases they won't actually own (see Practice note, Copyright: subsistence, duration and first ownership).

This is far from being merely a theoretical problem: last year in the Reprobel case, the CJEU held that publishers were not entitled to receive compensation under statutory copyright levies, because they are not listed as rights holders in the InfoSoc Directive (see Legal update, ECJ rules on interpretation of private-copying and reprography levies under Copyright Directive). This decision has plunged many European publishers into crisis, as they face a substantial loss of revenue and demands to repay tens or hundreds of millions of euros.

To help tackle these issues, the European Publishers Council (EPC), of which the Financial Times is a member, decided last year to campaign for a publishers' right, adding publishers to the list of rights holders under the InfoSoc Directive.

Copyright is part of my area of work, so from autumn 2015 I started to attend the EPC's discussions on the new right, along with representatives from EPC members across Europe. After much discussion and debate on what the scope of the right should be, the EPC submitted its proposal for a publishers' right to the Commission.

This was followed in January by a roundtable at the European Commission in Brussels at which I was one of ten representatives from European news publishers invited to put their case to the commissioner responsible for copyright policy, Günther Oettinger. The roundtable ended with Commissioner Oettinger indicating his support and asking publishers to assemble more evidence and arguments to help him make the case for a new right. At a subsequent roundtable in early March, Commissioner Oettinger confirmed his intention to put forward proposals for a publishers' right.

What is now being proposed is that publishers should be added to the list of rights holders under the InfoSoc Directive, alongside similar producers such as broadcasters and film producers. The publishers' right would recognise publishers' own investment and creativity in financing, commissioning, editing and distributing the final published editions of works, and align their rights more closely with the contribution they make to the copyright value chain. It would be a "neighbouring right", separate from the underlying copyright in individual articles, and would make no changes to the existing contractual arrangements between publishers and authors.

It remains to be seen what will happen next with the publishers' right. The consultation period ends in June, and any legislation will take time to enact, first at an EU level and then in member states' national laws. Whatever happens, on a personal level this has been fascinating work to get involved in, and has given me an insight into the contribution that in-house lawyers can make to the public policy process.

Understanding current law is clearly central to our role as lawyers, as is being able to understand and advise on the implications of forthcoming changes in the law. It's not a big step from there to being able to contribute to conversations on how the law should change in other ways. In addition, our specific role as in-house lawyers can give us a deeper understanding of the business we work for, and of how changes to law and government policy will affect our businesses in practice. Finally, the public policy process involves much of the same skills of drafting, negotiation, persuasion and advocacy as our "day jobs".

And quite apart from anything else, it's been exceptionally interesting and stimulating work. It's not every day that you find yourself representing your industry in the main chamber of the European Commission, and getting to work with your counterparts from multiple countries in helping to shape future changes to the law. Contrary to Saxe's cynical maxim with which I opened, paying closer attention to the making of new laws can be of benefit both to us as lawyers and to our clients.