Copyright levies on used products

June 10, 2019

According to 1cc Consulting, EU copyright levies may be applicable on used products brought on to the market after repair or refurbishment.

Earlier in May, German industrial associations and collecting societies have reached an overall agreement to apply copyright levies on various consumer electronic devices. Following years of negotiations, manufacturers, importers and dealers have finally attained clarity as to their obligations and the amount of levies due; charges of up to 12 Euro ($13) per product has to be taken into consideration in the context of the financial planning, administrative process and pricing.

In order to compensate for legal copying of copyright-contents such as music, film, photos or texts for private use, copying machines, printers and IT products, in particular, are now subject to levies in Germany. The new agreement covers a broad spectrum of consumer electronics. It includes DVD recorders, MP3 players, TV sets and set-top boxes with fixed memory or recording via USB interface.

EU copyright levies may also be applicable on used products brought on to the market after repair or refurbishment.

1cc Consulting explained that in the context of leasing contracts, the question also arises as to whether each new device is subject to levies during the term of the contract. Many suppliers are not aware of these particular payment obligations that are not uniform in all EU-countries and are difficult to be justified legally.

As a matter of fact, the obligation is legally controversial, 1cc Consulting said. On the one hand, national law does not always regulate the payment obligations for refurbished products, while on the other hand, refurbished products placed on the market have the same functionality as the original products. The buyer may use and reproduce works protected by copyright, so that the right holder receives due compensation.

Accordingly, the competent German authority is currently approaching affected companies directly and claiming levies on used products like, PCs, mobile phones and tablets. When asserting claims in Germany, the suppliers’ contractual situation with the authorities has to be taken into account, as well.

Consequently, parties that receive letters from the German collecting society are encouraged to check the claim carefully for applicability.