No Step-Free Copyright Exceptions: The Role of the Three-step in Defining Permitted Uses of Protected Content (including TDM for AI-Training Purposes)

European Intellectual Property Review (Forthcoming)

Faculty of Law, Stockholm University Research Paper No. 123

23 Pages Posted: 13 Nov 2023 Last revised: 9 Jan 2024

See all articles by Eleonora Rosati

Eleonora Rosati

Stockholm University, Faculty of Law

Date Written: November 10, 2023

Abstract

International instruments providing for exceptions and limitations (“E&Ls”) to copyright and related rights invariably refer to the three-step test (“3ST”). The requirement that permitted uses of copyright works and protected subject-matter be limited to certain special cases, which do not conflict with a normal exploitation thereof and do not unreasonably prejudice the legitimate interests of the concerned rightholder is found in regional legislation and several national copyright statutes too. Yet, the meaning, scope of application, and addressees of the 3ST remain – still today – the subject of uncertainty and diverging views. A debated issue is whether a court, having established that the relevant conditions of an applicable E&L under national law are prima facie satisfied, is also required to assess if the unauthorized act in question passes the 3ST to determine if that particular act is in fact outside the control of the concerned rightholder. This study addresses this question, which is ultimately answered in the affirmative.

As international, regional and national practices alike indicate, the 3ST is not only binding upon national (and, where relevant, regional) legislatures, but also courts when interpreting and applying domestic copyright statutes. That is so irrespective of whether the relevant copyright statute expressly refers to the language of the 3ST. By also considering as a case study – though the relevant conclusions hold true for any E&L and any system of E&Ls (whether open-ended or closed) – unlicensed text and data mining (“TDM”) practices and related E&Ls in selected jurisdictions in Asia and Europe, the study shows that national courts tasked with determining if an available TDM E&L is applicable in a certain case are also required to assess if the requirements of the 3ST are fulfilled given the circumstances at hand.

The analysis is structured as follows. Part 1 is devoted to the 3ST as found in international law: it reviews relevant history, rationale, and scope of application before turning to its application in practice. Part 2 considers the 3ST as found in regional (EU) and national law. With regard to the former, it discusses case law of the Court of Justice of the European Union, which clearly imposes an obligation upon national courts also to consider the 3ST when deciding on the applicability of a potentially available E&L under national law. Turning to the latter, a review of selected national experiences is conducted, which demonstrates how the consideration of the 3ST is not only necessary for courts in jurisdictions whose relevant statutes expressly refer to it, but also in jurisdictions where no specific mention is found in legislative instruments. Part 3 adopts purpose-specific E&Ls allowing TDM as a case study for a review of E&Ls in light of the international/regional three-step. In this sense, the focus is on the experience of selected jurisdictions in Asia (Japan and Singapore) and Europe (UK and EU). Part 4 discusses how national courts in those jurisdictions shall be required to interpret and apply national E&Ls for TDM in order to construe them in a way that satisfies the relevant requirements thereunder. Part 5 reflects on the broader implications of the analysis conducted in the preceding parts, by considering the applicability of the 3ST to any E&L and to any system of E&Ls (closed/open-ended) and the function of the 3ST more generally to ensure that a fair balance is struck between the requirement to ensure a high level of protection of intellectual property and copyright, on the one hand, and third-party fundamental rights and interests, on the other.

The main conclusion is that the 3ST informs (a) the drafting and construction of E&Ls, (b) their implementation into domestic law, and (c) their application in practice. In turn, it is not sufficient for a court to consider whether the relevant conditions of a given E&L are satisfied: that court must also review whether the unauthorized use of a copyright work or other protected subject-matter may exclude liability of the defendant in light of the requirement that an E&L is limited to certain special cases, which do not conflict with the normal exploitation of the protected content at hand and do not unreasonably prejudice the legitimate interests of the rightholder. All this is further confirmed by the consideration that the 3ST is a fundamental mechanism that contributes to ensuring – in compliance with international, regional and national laws alike – that a fair balance is struck between protection of copyright and related rights, on the one hand, and third-party rights and legitimate interests, on the other. Failure to consider the 3ST on the side of either legislatures or courts implies that no fair balance may be fully achieved, including having regard to the development of generative AI.

Suggested Citation

Rosati, Eleonora, No Step-Free Copyright Exceptions: The Role of the Three-step in Defining Permitted Uses of Protected Content (including TDM for AI-Training Purposes) (November 10, 2023). European Intellectual Property Review (Forthcoming), Faculty of Law, Stockholm University Research Paper No. 123, Available at SSRN: https://ssrn.com/abstract=4629528 or http://dx.doi.org/10.2139/ssrn.4629528

Eleonora Rosati (Contact Author)

Stockholm University, Faculty of Law ( email )

S-106 91 Stockholm
Sweden

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
964
Abstract Views
2,546
Rank
44,566
PlumX Metrics