The UK Intellectual Property Office (IPO) published a policy statement (20-page / 416KB PDF) detailing that both commercial and non-commercial use of orphan works will be permitted, subject to certain conditions, under new laws that the Government will draft. However, those uses will have to be paid for in order that rights holders can be remunerated for those uses if their identity is ever discovered, it said.
"Commercial and non-commercial uses of orphan works in the UK will both be permitted, both to maximise the economic potential of proposals and because making a firm distinction between the two is difficult in practice," the IPO said in its policy statement. "This permission should come at an appropriate price – a market rate, to the extent that one can be established (though the difficulties that may attend establishing that, for example in respect of works not created for publication that are in museums’ collections, are noted)."
"This price should be payable in advance (or at agreed times if there is a royalty element) and set aside for any rights holders who may still appear even after a diligent search has not found them," it added.
Orphan works are copyrighted material, such as books, films and music, which have no identified owner. Currently organisations, in particular those such as libraries, archives and museums, are unable to make copies of orphan works materials because to do so would breach the copyrights of the owners of those works.
The Government has sought to create a system that enables orphan works to be reused whilst taking account of the unknown owners' rights to the works. Amongst its other considerations has been ensuring that other rights holders do not "suffer from unfair competition" because of "perverse incentives" being offered through a new orphan works scheme.
In elaborating what was meant by 'perverse incentives' a spokesperson for the IPO told Out-Law.com that the Government "wants to ensure that people don't have an incentive to use an orphan work over an existing known work because it's easier or cheaper to do so."
"That's why Government is proposing that remuneration should be set aside at the time the orphan work is used at a rate that is comparable with similar known works being used in a similar way," the spokesperson added.
Under the Government's plans organisations that wish to use orphan works will have to conduct a "diligent search" for the owner of the works before they can use the material. Those searches must be verified as diligent by independent authorising bodies, which have yet to be designated by the Government.
The IPO admitted that what constitutes a diligent search in one creative sector may not meet the standards for conducting a diligent search in another. This is because of the complexity involved in identifying who rights holders of certain material are, it said.
"The Government ... understands that the use of orphan works may operate in different ways in different sectors, for example, where rights holders are not represented by collecting societies," the IPO said. "Diligent searches for complex works such as audio-visual works, that may contain moving and still images, speech and music, will necessarily take more time than works with only one type of copyright."
"The Government also recognises that photographs often lack any information about rights holders or about the photograph’s age, original purpose, subject matter or country of origin," it said.
The new orphan works law will contain scope for the Government to omit certain categories of works from inclusion in the new orphan works scheme.
"The Government will legislate in such a way that no sector or type of work is necessarily excluded from the orphan works regime, but there is flexibility to introduce different schemes for different sectors or types of work," the IPO said. "So for example the power would make it possible to introduce an orphan works authorisation regime for analogue photographs but not for digital photographs."
The IPO said that it is its intention that a new registry of orphan works be created and that it is "minded" to include "unpublished works" within the scope of the scheme.
It said that the Government wants the new orphan works regime to be "compatible" with parallel work ongoing at EU level over the liberalisation of orphan works, but admitted that many details of how the scheme would operate in practice had still to be determined.
Matters still to be decided include the extent to which the independent authorising bodies should consider "possible derogatory treatment" of orphan works when deciding whether to allow organisations to use the works.
How the planned orphan works scheme will interact with any new digital copyright exchange for the licensing of copyrighted content has also still to be established as well as where set-aside remuneration should go if it has been "unclaimed after a period of time to be determined".
Whether and to what extent orphan work 'diligent searches' can be re-used have also still to be decided as well as the details of how diligent searches will work, it said. The IPO has still to decide whether it would be appropriate to consider that diligent searches have been conducted on the basis of sampling of search results, rather than through an assessment of individual results, in cases where the searches span a "large number of works".
The timetable for implementing new orphan works schemes has also still to be decided.
"Freeing up so-called ‘orphan works’ will allow use of works for the first time, making the most of untapped economic and creative potential," Business Minister Norman Lamb said in a statement.