Framework for “Notice-and-Takedown” Procedure: UA vs US
Andrey Nikolayenko
In May 2013 Ukraine was designated by the U.S. Government as a Priority Foreign Country (PFC), which meant that Ukraine has been ranked the No. 1 pirate country in the world.
The PFC designation was based specifically on three critical problems in Ukraine’s intellectual property rights (IPR) regime, and one of them is failure to implement “an effective and systemic means to combat widespread online infringement of copyright and related rights”. These problems (namely, online piracy, of which torrents and illegal online movie streaming are the most representative examples) are causing severe economic harm to copyright rights holders in Ukraine.
To jolt this matter from a state of deadlock the Ukrainian Parliament adopted the highly-anticipated Law of Ukraine On State Support of Cinematography in Ukraine No.1977-VIII (valid since 26 April, 2017).
The Law, which is probably the most important legal act regarding IPR protection of the past few years, on top of criminalizing camcording and card sharing, introduces amendments to the Law of Ukraine On Copyright and Related Rights by creating a detailed procedure for taking down IPR-infringing content on the Internet. This procedure, called “notice-and-takedown”, is meant to be an effective tool for combating online copyright infringements.
General overview of procedure
The main idea and goal of the notice-and-takedown procedure is to enable rights holders to promptly cease infringement of IPRs on the Internet without referring to a court.
This procedure applies not to all but only certain copyright works and objects of related rights, such as: audiovisual works, musical works, computer programs, video recordings, phonograms, and the programs of broadcasting organizations (Digital Information).
So, how does it work?
According to the Law, a copyright/related rights owner (Copyright Holder) has the right to send a claim (takedown notice with a request to disable access to copyright works and/or objects of related rights) to the (1) website owner, (2) web-page owner, and (3) hosting provider.
Such a claim can only be sent only through an attorney-at-law (admitted to the Ukrainian Bar). At the same time, the attorney shall verify whether the documents provided by the Copyright Holder prove that the latter owns the rights to terminate any violation.
Actions/time limits
Having received the claim, the website owner shall within 48 hours from the receipt of a claim disable access to the Digital Information and notify the claimant and hosting provider of the measures taken. Website owners may refuse to comply with the claim and shall notify the claimant and hosting provider on its refusal within 48 hours of the receipt of a claim, as well as provide reasoning for such refusal, namely: (1) the claim is filed not in compliance with the requirements above; or (2) the website owner has copyright to such Digital Information; or (3) the addressee of the claim is not the web-site owner.
As per the established procedure, the Copyright Holder may send the ñlaim directly to the hosting provider if (1) the website owner has not disabled access to the Digital Information or (2) the website and WHOIS database does not contain the contact information of the web-site owner. In such a case, the hosting provider shall, within 24 hours of receipt of a claim, send a copy of the claim to the website owner. If the website owner does not reply within 24 hours, the hosting provider will disable access to the Digital Information. The website owner is entitled to notify the hosting provider about its refusal to disable access to the Digital Information and if such refusal complies with requirements of the Law, the hosting provider shall send it to the claimant and restore access to the Digital Information from the 10th business day unless the claimant provides evidence of initiation of court proceedings on protection of its copyright and/or related rights.
There are currently no statistics available regarding the takedown rate and it is probably too early to speak of the effectiveness of this procedure in Ukraine. Along with this, we can refer to foreign experience to see how the notice-and-takedown procedure is established and operates abroad.
The DMCA
Ukraine is not the first country to implement procedure under which Internet intermediaries either remove or block access to illegal content after receiving a special request to do so.
In 1998 when Larry Page and Sergey Brin founded Google, the Digital Millennium Copyright Act (DMCA) was adopted in the US. The aim of this act was to provide a mechanism for IPR holders to protect their works online, while also providing the legal certainty necessary for increasing investment in, and growth of, the Internet.
On the one hand, rights holders can achieve “quick” removal of allegedly infringing content, without the need to register their works with the IP Office or file a lawsuit — without even involving a lawyer to write a cease and desist letter. On the other hand, online service providers, as defined in the DMCA, do not have to expose themselves to the risk of company-ending liability, so long as they remove allegedly infringing content upon notice and adhere to the other requirements of safe harbors.
While the notice-and-takedown procedure under the DMCA has proved its effectiveness, there may be some room for improving the Ukrainian one. Let’s consider the discrepancies between the US and UA procedures and their possible negative impact on the Internet industry and its users.
Possible negative consequences and risks
Scope and targeted entities
The DMCA provides, inter alia, safe harbors for immunity of online service providers from copyright liability stemming from: transitory communications; system caching; storage of information on systems or networks at the direction of users; and information location tools.
In contrast to the DMCA, the Law does not identify the providers of such services as: (à) storage at the direction of a user of material that resides on a system or network controlled or operated by or for the service provider, and (b) referring or linking users to an online location containing infringing material or infringing activity, by using information location tools, which may complicate the classifying of a provider’s services and actions in accordance with the Law.
Potential risks:(a) inconsistent approach to whether online service providers such as search engines or social media networks, actually fall within the definition of “website owner”; (b) in the event of a web-page owner sending a notice on refusal to disable access to the Digital Information (e.g., the web-page owner believes that he/she has the right to use the Digital Information) and the Copyright Holder does not agree with such refusal, there is a risk that the Copyright Holder will engage not only the web-page owner, but also the service provider as defendants in court proceedings related to infringement of IP rights.
Liability for taking down
The DMCA stipulates no liability for service providers for taking down. The Law provides relief from liability for disabling access to the Digital Information only for hosting providers. Website owners are not relieved by the Law from liability towards the owners of the web-pages for the consequences of disabling access to the Digital Information published on their web-pages.
Potential risks:filing of lawsuits by web-page owners against website owners for any damages caused by taking down measures (for instance, if the web-page owner has a good excuse for failing to respond to the claim and notice from the website owner).
Deadlines for taking actions
The Law sets out strict deadlines for taking measures by the website/web-page owners and hosting providers in response to the claim (48 or 24 hours). The DMCA provides for "expeditious" action by the service providers. However, the absence in the Law of Ukraine of time limits fixed in legislation for replying to claims made by rights holders will obviously lead to legal uncertainty, differing interpretations of response deadlines by rights holders, owners of websites/web-pages, hosting providers and courts. At the same time, it would be also reasonable to set out in the Law that if the end of the deadline for taking measures falling on a weekend, holiday or other non-working day, the last day of such deadline is the first working day thereafter.
Potential risks:delay in taking actions in event of the deadline for taking measures falls on a weekend, holiday or other non-working day.
Counter notification
The Law does not expressly provide a counter-notification procedure for website/web-page owners,the access to whose materials has been disabled, which may lead to the abuse of notice-and-takedown mechanisms.
At the same time, the provisions of the Law on compulsory engagement of an attorney-at-law for sending the notice, as well as administrative responsibility (penalty) for providing false information about the existence of rights, may mitigate this risk of abuse. In addition, a website/web page owner may reject the claim and refuse to disable access to the Digital Information in the event it has the right to use such Digital Information.
Potential risks:abuse of the notice-and-takedown mechanisms, which is mitigated by compulsory engagement of an attorney-at-law for sending the notice and administrative responsibility for misrepresentation.
Liability for false claims of infringement
The Law envisages only administrative responsibility in the form of a fine for misrepresentation made by the claimant as to its IP rights to copyright works and/or objects of related rights in a claim. In contrast to the DCMA, the Law does not provide for liability of the claimant for possible damages and legal fees incurred by the website/web-page owners and/or hosting company in connection with such claim. This may also lead to abuse of the notice and take down procedure.
Potential risks: (a)abuse of the notice and take down procedure; (b)risk of damages and legal fees incurred by the website/web-page owners and/or hosting company in connection with a false claim.
Personal data of the infringer
According to the Law, notification of the measures taken should contain full information about the owner of the website (name, location, address for correspondence, phone number, email, etc.). Such information shall also be provided by the hosting services provider if it has taken measures with respect to a particular website. On the one hand, such provision is contrary to the DMCA, according to which such data may be received by the rights holder only through the use of a subpoena issued by a federal court at the owner's request. At the same time, taking into account Ukrainian procedural legislation, if the information about the owner of the website/web-page who infringed IP rights is not disclosed, the rights holder will be forced to initiate court proceedings and engage hosting providers and/or website owners thereto for obtaining the contact information of the infringer.
Potential risks:risk of disclosing personal data, however, such a measure is necessary for avoiding excessive court proceedings.
Administrative liability
Pursuant to the Law,the website/web-page owners and hosting providers may be fined for failing to disable access of Internet users to copyright works and/or objects of related rights, failure and even delay in responding to a claim, misrepresentation made in a response to a claim, as well as failing to disclose their corporate details on their websites and/or the WHOIS database. In contrast to the Law, the DMCA does not provide for such liability.
According to the Law, the website owner, web-page owner and hosting provider shall not be liable for copyright infringement if they comply with the provided notice-and-takedown procedure. The Law provides that the website and web-page owners will not be relieved from copyright infringement liability if the website/web-page owner, despite the received and satisfied claims, admitted the use of the same Digital Information at the same website/web-page at least twice within a period of 3 months.
Potential risks: the website/web-page owners and hosting providers can be fined the amount of approximately UAH 8,500 — 34,000 for the violations mentioned above.
Conclusion
Notwithstanding some stalled attempts at making legislative reforms to improve the Government of Ukraine’s response to online infringement (inter alia, by introducing the notice-and-takedown procedure), Ukraine continues to host some of the largest pirate sites in the world, which serves IP infringing content to a global audience. Improving these problems would advance the Government of Ukraine’s own agenda for economic improvement, particularly in promoting foreign direct investment. If undertaken properly, fixing these problems and, inter alia, adjusting the notice-and-takedown procedure (to mitigate the above risks), will improve the marketplace for the digital distribution of music, films, television programs, video games and books online, also benefiting Ukrainian consumers and the local economy.
Andrey Nikolayenko, senior associate at AEQUO
