Europeans already impose copyright levies on CD burners and other digital recording devices. Next up, personal computers.

The Presumed Guilty
   CD burners

January 29, 2001

Presumed Guilty
Europeans already impose copyright levies on CD burners and other digital recording devices. Next up, personal computers.
By Kristi Essick

PARIS The French are accustomed to paying high taxes on just about everything, so Catherine Tasca probably thought she was on solid ground when she proposed a new copyright levy on personal computers. But as France's culture minister, Tasca quickly found herself in a political firestorm that has rekindled a debate across Europe on how to combat copyright infringement.

Tasca told the daily newspaper Le Figaro earlier this month that she favored taxing PCs and placing the proceeds in a general fund to compensate artists for copyright infringement propagated by computer users. Last week, France started imposing a similar tax on recordable CDs, DVDs and minidiscs, as well as MP3 players. PCs, Tasca argued, make it just as easy to steal copyrighted music, movies and other material. Sales of removable recording devices soared to 200 million units last year, up from 50 million in 1991. Most of the growth is in digital recording devices.

But it's one thing to presume a CD burner will be used to contravene copyright; it's another for France to impugn the PC, the engine of the technological revolution. Accordingly, Socialist Prime Minister Lionel Jospin and President Jacques Chirac's conservative party lashed out at Tasca, accusing her of holding back France's technological progress. Computer manufacturers also cried foul, and software manufacturers asked for some of the proceeds.

In the face of such controversy, Tasca had no choice but to back down. "The government does not tax computers and has no intention of doing so," she said after the PC levy notion was first reported. But the outcry in France has revived a debate on whether a copyright tax on computers is enlightened or extreme. Most European countries already levy copyright fees on video and audio cassettes and are increasingly imposing them on digital recording media, including MP3 players and handheld devices.

Technically, these levies are not a tax because the payments do not flow into government coffers. Instead, a copyright committee collects the money and turns it over to artists' associations, which in turn pay their members.

European governments have implemented the approach widely, backed by the argument that artists would at least be compensated for some of the inevitable copyright infringement of their works whether or not everyone who buys cassettes or recordable CDs uses them for illegal purposes. In France, artists associations are expected to receive $214 million this year from the copyright levies on all recording devices. In the United States, the debate has been left up to the respective entertainment and technology industries, which have proposed different solutions from digital watermarks to hardware containing copyright-control mechanisms.

The U.N.-affiliated World Intellectual Property Organization doesn't take an official stand on copyright taxes, but looks at the levies "with a favorable eye," according to a spokeswoman in WIPO's copyright law division.

The European Union has also declined to take a formal stand, instead allowing its member states to decide whether to impose levies. Twelve of the 15 member countries impose them on recording media. Germany and Greece have imposed levies on PCs, but they are being contested and therefore are not enforced.

Supporters say a levy on PCs is the least governments can do to help the fight against copyright infringement.

"We don't consider this a tax; we consider it compensation," says Frdric Campo, a spokesman for SCPP, a Paris association that defends the copyright of music producers. Campo adds the association would support a levy on computers, which he believes are increasingly being used to download copyrighted musical recordings.

Opponents include some individual consumers who don't feel they should pay for other people's misuse of recording media, and software makers, which don't get any of the payback.

The manufacturers of recordable media such as blank CDs and DVDs naturally oppose the levies because they believe the taxes will hurt sales. Other critics feel the money ends up lining the pockets of copyright-protection associations, which often support publishers and producers, not the artists it's meant to compensate. The French levy system earmarks 25 percent of the total funds for producers and sets aside another 25 percent for young, emerging artists. But critics say the distribution of funds is hard to control. "The artists hardly touch the money," complains Dominik Fusin, publisher of anticopyright tax site

Fusin says he has amassed more than 30,000 signatures from people in France who oppose fees on any recording media. They may be able to stop the levies from being imposed on PCs, but it's doubtful they'll be able to roll back the ones already in place. Those levies certainly have flaws, but at least they allow governments to say they are fighting the thieves.

GUIDE TO COPYRIGHT LEVIES IN EUROPE Britain, Ireland and Luxembourg don't assess any copyright fees on the sale of various recording devices. But the 12 other members of the European Union do. Here's a sample of the fees. COUNTRY AUDIO CAS- SETTES (60 MIN.) VHS CAS- SETTES (60 MIN.) AUDIO RECORD- ERS CDS, DVDS AND DATS (60 MIN.) 1 CD BURNERS 2 PERSONAL COM- PUTERS 2 MP3 PLAYERS Austria $0.13 $0.19 None $0.04 to $0.85 None PC makers and artists discussing possible levies None Belgium $0.05 $0.05 3% of retail price $0.13 None 3 $0.28 per 500MB hard disk capacity None Denmark $0.39 $0.55 None $0.44 None Being considered None Finland $0.32 $0.48 None $0.11 to $0.32 None None $0.36 per 32MB storage France $0.30 $0.46 None $0.49 to $1.34 None Artists demanding new levies $2.50 Germany $0.06 $0.10 $1.37 $0.02 to $0.06 $6.554 Disputed and not being enforced None Greece 6% of whole- sale price 6% of whole- sale price 6% of whole- sale price 6% of whole- sale price price 6% of whole- sale price 5 Disputed and not being enforced None Italy 10% of whole- sale price 5% of whole- sale price 3% of whole- sale price 10% of whole- sale price price 3% of whole- sale price price 6 None Being considered Nether- lands $0.24 $0.35 None $0.14 to $0.42 None None None Portugal None 7 None 7 3% of retail price None 7 None None None Spain $0.19 $0.32 $0.64 $0.19 $0.606 None None Sweden $0.14 $0.14 None $0.14 None None Artists demanding new levies 1 So-called digital storage media includes CD-R, CD-RW, DAT, DVD-R, minidisc. 2 Figures reflect claims or preliminary settlements. 3 Levy overturned by Belgian courts. 4 settlement, now retracted by Hewlett-Packard. 5 Lawsuit pending. 6 claimed but currently not being paid. 7 Legally required but not enforced. Source: Copyswede, Danish Ministry of Justice, European Association of Consumer Electronics Manufacturers, French Ministry of Justice, Informationskreis Aufnahmemedien, German Ministry of Justice, Zentralstelle Fr Private berspielungsrechte

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