Royal Decree 12/2017 Reintroduces the Copyright Levy

Thursday, 7 of September of 2017

The Intellectual Property Law, approved by Royal Legislative Decree 1/1996, of April 12, establishes the system of protection of copyright and related rights in Spain. Among the different patrimonial rights, the Law includes the right of reproduction that entitles its holder to authorize or prohibit the production of copies of his work. However, this right has a number of limitations, including private copy exception. This limitation comes from Directive 2001/29 on copyright in the information society. According to the mentioned Directive, a physical person may make a copy of a work for his exclusive private use without direct or indirect commercial purposes. In order to include this exception into the national legal systems Member States must introduce an equitable compensation for rightsholders.

With the approval of Royal Decree-Law 12/2017, of July 3, the Spanish Intellectual Property law has been amended to replace the system of equitable compensation. Before its approval the system of compensation for private copying was financed by the State Budget, now with the new amendment a so-called digital levy has been introduced. It consists on the payment of an amount by manufacturers and distributors of equipment, apparatus and reproduction media.

This compensation system was applied before 2012, when it was replaced. The reason for the return to the digital levy system is due to the CJEU judgment of 9 June 2016, C-470/14, EGEDA in which the Court decided that fair compensation for private copying should be paid by users in physical persons.

It is not the first time that Spain uses this kind of compensation system. However, in order to avoid the indiscriminate imposition of the levy that was used before, this new amendment introduces a double system of "ex ante" and "ex-post" reimbursement.

The new compensation system establishes that some purchasers of equipment and material for reproduction will be exempted from paying the levy. For instance, when the purchase is made by entities from the public sector or by legal or physical persons that can justify the exclusively professional use of equipment will not have to pay the levy. The levy will be exempted too in the case that the purchaser has an authorization to carry out the reproduction of works, performances, phonograms or videograms in the exercise of their activity, and those performed by individuals for private use outside Spanish territory on a regime of travellers.

A provisional system has been established to determine the amount to be paid for each recording device. For example, for each non-rechargeable compact disc the amount to pay will be around 0.008 euros; For each non-integrated disc suitable for the reproduction of videograms, texts and phonograms the amount will be 6.45 euros. For mobile phones, the levy is 1.10 euros and 3.15 for a tablet. A definitive list will be established by the government every year.

Undoubtedly this measure has provoked confronted opinions. However, the Spanish Government and different associations are happy with the new system.