Page 139 - A Study on the Role of UGC Platforms in Copyright Law：An Intermediary-oriented Approach

A Study on the Role of UGC Platforms in Copyright Law: Chapter 5 Formulating a Non-commercial UGC Creation Levy Scheme
An Intermediary-oriented Approach

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TPMs from the outset. In such cases, it is difficult for the rule to provide sufficient breathing
space for the large number of amateur creators who lack the capability and equipment to
bypass technical controls to make fair use of the copyrighted works.

5.2.2 Difficulty to enter into copyright licences

Copyright law has addressed large-scale use that cannot be covered by fair use/dealing
through collective licensing schemes. Nevertheless, the putative licensees of collective
licences have been professional users such as restaurants, broadcasters and KTVs. They
have facilities with specific-asset investments and are often registered as public institutions
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that are easy to identify. In contrast, there is a higher possibility that end users will cheat
copyright owners because they are difficult to detect and have a small probability of being
sued. What is more, collective licensing schemes have been designed for non-altering use,
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such as the reproduction of sound recordings or the public performance of musical works.
Altering use has a greater probability of constituting fair use that does not require a licence
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at all, whereas non-altering copying is more likely to be subject to licensing. As collective
licensing is a kind of blanket licensing that does not involve the negotiation of individual
cases, restricting collectively licensed use to non-altering use could avoid many, although not
all, mistakes.
In the UGC scenario, a large number of UGC creators are nonprofessional users and
most of their use involves altering. This renders collective licensing inapplicable and entails
extraordinary cost to enforce copyright in individual cases of UGC creation. Although
digital technologies such as blockchain and smart contract can reduce the costs of copyright
enforcement, these technological prescriptions can only function after infringement has been
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determined. They cannot help with distinguishing fair use and infringement. The cost of
delineating the boundary between infringement and fair use, together with non-professional
UGC creators’ lack of negotiation skills, has deterred agreements between UGC creators
and copyright owners. The problem has been even more severe for UGCs that involve more
than one pre-existing work. Every putative licensor has the incentive to delay negotiations
to become the last one to grant a licence because such licensors have the greatest bargaining
power. This is the ‘tragedy of anti-commons’ referred to by Michael Heller.
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56 See notes 16-19 in Chapter 3 and accompanying text; See also Li (n 12) 19.
57 Daniel Gervais, ‘The Changing Role of Copyright Collectives’ in Daniel Gervais (ed), Collective Management of Copyright
and Related Rights (Kluwer Law International 2006) 4.
58 Gervais, ‘The Tangled Web of UGC’ (n 10) 848.
59 Though according to the recontextualization standard, non-altering use may be defended as fair use due to the transformation of
context and distribution channels, the recontextualization standard is controversial. See supra notes 20-30 and accompanying
text. Furthermore, only a small amount of non-altering use changes the context and distribution channel of the original work.
60 Li (n 12) 33.
61 Michael A Heller, ‘The Tragedy of the Anticommons: Property in the Transition from Marx to Markets’ (1998) 111 Harvard
Law Review 621.

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