Database Protection

From Max-EuP 2012

by Matthias Leistner

1. A new neighbouring right for the protection of databases

Compilations of works, data or other materials are protected by copyright if the selection or arrangement of the content is the author’s own intellectual creation. Such copyright protection of the creative structure of databases, which does not extend to the contents of the database as such, exists in all Member States as a result of respective obligations in international law (Art 10 TRIPs). Before 1996, the copyright protection varied throughout the Member States with regard to the conditions and scope of protection. Against this background, the first objective of the European Database Directive (Dir 96/9) of 1996 was to harmonize the conditions and scope of copyright protection for the structure of databases.

However, in the digital environment copyright protection for databases leaves substantial protection ‘gaps’ with regard to the investments of database makers. This is mainly because database makers are exposed to the risk that the contents of their databases may be easily copied and rearranged electronically to produce a database of identical content which does not infringe copyright since copyright protection is limited to the creative arrangement of the material. For this reason the second (and main) goal of the Database Directive was to establish a new sui generis protection regime for investments in the compilation, verification and presentation of databases. Thus, existing differences in the legal protection of databases against misappropriation in competition were to be removed. At the same time, effective protection of the investments of database makers against free-riding by competitors was intended to set strong incentives for European database production.

Consequently, the directive established a two-tier protection system for databases. First, traditional copyright protection for the individual authors of the creative structure of compilations was harmonized. Secondly, the new sui generis protection right—which can be characterized as a neighbouring right which protects the investments of database makers, ie the persons who bear the entrepreneurial risk. Thus, both rights can overlap with regard to a single database as their objects of protection as well as the ownership of the rights are designed differently.

2. The evolution of database protection

Before the new sui generis protection regime came into force, flexible legal protection against certain acts of misappropriation of databases through systematic free-riding on the investments of a competitor was established in the framework of unfair competition law in most continental European Member States. By contrast, in the United Kingdom and Ireland broad copyright protection fulfilled this function, as the conditions of copyright protection for databases were comparatively low in these Member States and copyright could thus protect substantial investments into databases as such. The Dutch doctrine of geschriftenbescherming which provides for copyright protection of simple non-creative compositions played a similar role. In the Nordic Member States protection of databases was granted in the specific framework of a neighbouring right protecting certain catalogues. In fact, the sui generis right for database makers has even been loosely modelled on these Nordic catalogue protection rights.

Against the background of the different protection regimes (beyond copyright) in Europe, the introduction of the sui generis right can be regarded as a compromise solution. On the one hand, in countries such as the United Kingdom and Ireland the previously low threshold for copyright protection for databases was raised consistent with the stricter standard prevailing on the European continent where an own intellectual creation was required. On the other hand, the investment protection right compensated for the resulting limitation of British and Irish copyright law by introducing a genuine exclusive right for the protection of investments of database makers which reaches far beyond the comparatively specific and limited case law on unfair competition protection against imitations in most of the continental European Member States. The resulting expansion of protection for mere investments in databases has been criticized from the very beginning. According to the critics, the new sui generis right leads to a monopolization of information as such—alien to the established principles of copyright law—which in turn can lead to unjustified restraints of freedom of information and competition in certain situations (intellectual property and restraints of competition).

Today, the Database Directive has been implemented in all Member States. Moreover, first landmark judgments on the new sui generis right have been handed down by the European Court of Justice (ECJ) and by some Member States’ courts. On that basis, the critique of the sui generis right shall be discussed in the following.

3. Status of harmonization and problems

Apart from some optional provisions, eg in the field of exceptions to protection, the Database Directive follows a concept of full harmonization. Thus, the Member States had only limited leeway in implementing the substantive provisions of the directive on the new sui generis protection regime. However, with regard to the systematic context of implementation, the concepts differ throughout the Member States. Two main approaches can be distinguished. In Austria, Germany, Spain, the Scandinavian countries and some other Member States the sui generis right has been implemented as a neighbouring right in the larger framework of copyright law (copyright) which allows the recourse to copyright concepts in the field of use rights and other issues. By contrast, other Member States, such as the United Kingdom, have implemented the new right in an independent statutory instrument. Other Member States, such as France and Belgium, have chosen a middle course. The new sui generis right was implemented within the larger frameworks of the comprehensive French Code de la propriété intellectuelle or the Belgian copyright law, respectively, however, without any substantive recourse or systematic link to copyright concepts.

According to the definition of the directive, the range of theoretically protectable databases is remarkably far reaching: Any systematic or methodically arranged compilation of independent elements, individually accessible by electronic or other means, can qualify for protection. From a practical perspective this definition covers any conceivable electronic or analogue database or compilation; the element of independence of the compiled materials only excludes unitary subject matter, such as audio-visual or multi-media creations (eg typical computer games). The crucial substantive condition of protection is the qualitative or quantitative substantiality of the investment put into the obtainment, verification or presentation of the contents of the database. This broadly drafted general clause has meanwhile been specified by many Member States’ courts. Hitherto, the general tendency seems to be that the criteria applied for assessing substantiality are not overly strict; effectively, any serious and sufficiently documented investment of financial resources, time, effort and energy can suffice. The resulting exclusive protection right has a term of 15 years (with new and independent protection for any substantial updating investment). Exclusive protection is limited to acts of extraction or re-utilization of substantial parts of the contents of the database. Remarkably, the directive’s optional list of possible exceptions to protection in Member States’ laws is even narrower than the respective list of possible exceptions to copyright protection of databases.

As a result, protection by the new sui generis right is very strong and generally protects the database maker against any re-utilization of substantial parts of the content of the database even if the material is re-arranged or transformed. However, as a matter of principle, the database right does not prevent competitors from independently compiling the same material as the original database maker as it is only the specific and substantial investment of the database maker into gathering, verifying and presenting the contents of the protected database which is protected by the sui generis right. Nonetheless, the new right can lead to monopolization of data and thus to possible abuses of dominant positions by database makers in certain specific situations. In particular, in so-called sole source data situations (ie if the data compiled in the database cannot be obtained independently in any economically viable way), the database maker can indeed potentially abuse his exclusive protection right in order to unjustifiably exclude any competition on downstream markets based on further use of the data compiled in the database. Such situations particularly occur if the database maker has not collected independently available data but instead has generated data in the context of another main activity (spin-off situations). Examples which have emerged in the case law of both the ECJ and different Member States’ courts include, for example, the protection of fixtures data for different sporting events or train timetables. In all these cases, the makers of the database which had generated the data in the context of another main activity (ie the organization of the sporting events or the train service), relied upon their alleged database rights in order to exclude competition on certain aftermarkets, such as the market for sports-betting or information services regarding train timetables.

Indeed, the ECJ was soon faced with sole source data situations concerning horse racing information and football fixtures in the landmark case of British Horseracing Board v William Hill (ECJ Case C-203/02 – BHB v Hill [2004] ECR I-10415) and the parallel Fixtures Marketing judgments (ECJ Case C-444/02 – Fixtures Marketing v Organismos Prognostikon [2004] ECR I-10549; ECJ Case C-46/02 – Fixtures Marketing v Oy Veikkaus AB [2004] ECR I-10365; ECJ Case C-338/02 – Fixtures Marketing v Svenska Spel AB [2004] ECR I-10497). In these cases the alleged right owners had effectively tried to control the betting aftermarkets relying upon database protection for their sports fixtures data. Faced with these facts, the ECJ defined the objective—and consequently the particular protected immaterial subject matter and the scope of protection—of the new sui generis right in a rather restrictive way. Referring to the recitals of the directive, the court focused on the intent of the new right, ie to promote the production of compilations of data. On the basis of this purposive argument the court excluded those investments from the concept of relevant investments ‘in obtaining, verification or presentation of the content’ of the database which are not directed at the gathering of already existing independent materials. Thus, only investments in the gathering and verification of pre-existing independent material are eligible for protection by the sui generis right. This purposive construction particularly excludes investments which are only used for creating materials which make up the content of a database.

Remarkably, this approach helps to solve the most imminent competition-related problems in sole source data situations, as it is typical for these situations that the data cannot be obtained independently because they have been generated by the database maker in the context of another main activity. Nonetheless, the approach of the ECJ leaves open questions. In particular, criteria will have to be developed to distinguish between investments into the obtaining of independently existing data and the mere verification and presentation of data generated by the database maker. This distinction is hard to make with respect to databases produced in corporate groups or larger enterprises as well as with respect to scientific databases which are based on the measuring of existing natural data. According to a competition oriented approach, the crucial guiding post for these situations should be the test of whether the data in question can be independently obtained by competitors or whether such independent obtainment is impossible or at least economically unviable. Only if the data cannot be obtained independently, the database right should be limited accordingly. Apart from that, in certain situations compulsory licences can follow from the application of Art 102 TFEU/82 EC where the unjustified refusal of a database maker in a dominant market position amounts to an abuse of dominant position; however, the criteria for such compulsory licences of intellectual property rights are strictly constructed by the ECJ (intellectual property and restraints of competition).

4. Perspectives

Meanwhile, the database protection right—which was once even conceived by the European Commission to be a model for an international instrument in the field of database protection—is broadly subject to criticism. In a global perspective, only South Korea has introduced a statutory instrument of database protection modelled exactly along the lines of the European sui generis regime. Most other countries rely on copyright, contracts and the legal protection of technological protection measures as well as on flexible unfair competition case law (where such doctrine exists) in order to fulfil the protection needs of database makers. Against this background, the introduction of an international protection instrument for databases cannot be expected in the near future.

In its Evaluation Report on the application of the new sui generis right of 2005 the European Commission acknowledged that the sui generis right had failed to reach its goal to set effective incentives for European database production. The European Commission outlined four possible options for the future of European database protection, namely to repeal the directive altogether, to withdraw the sui generis right, to make necessary amendments to the sui generis right, or to maintain the status quo. In fact, in the near future, the only realistic alternatives are options three and four. In particular, repealing the database right and thus returning to the status quo ante of considerable disharmonization, legal uncertainty and tendencies to inadequate protection in contract law and unfair competition law is not a realistic option at the moment. Instead, further case law of the ECJ should be awaited which will gradually concretize the vague and broadly formulated concepts of the directive in case law (see recently ECJ Case C-304/07 – Directmedia Publishing GmbH v Albert-Ludwigs-Universität Freiburg [2008] ECR I-07565; ECJ Case C-545/07 – Apis-Hristovich EOOD v Lakorda AD [2009] ECR I-01627).

However, some amendments to the provisions on the sui generis right are suggested in academic literature and do indeed seem necessary or at least worthy of consideration. Thus, the systematic delineation of the sui generis right within the system of alternative protection instruments in Member States’ national laws and, particularly, the relationship to national instruments of unfair competition law protection against imitations should be clarified. Unfair competition is among the legal provisions whose application, according to its Art 13, is not prejudiced by the Database Directive. However, it should be clarified that this does not mean that an additional layer of unfair competition law protection of investments can be established ‘underneath’ the protection established by the sui generis right. Instead, unfair competition law protection should only be triggered when additional factors—apart from the objective of investment protection—are present in a case, such as a risk of confusion as regards the origin of the database in question from the viewpoint of the relevant public. Moreover, the provisions on exceptions to the sui generis right which are too narrowly drafted in several respects should be aligned with the optional exceptions to copyright, established by the Information Society Directive (Dir 2001/29), and thus at least be linked to the current, more developed status of European law in this field. Moreover, the introduction of provisions on compulsory licences for certain situations where the database right arguably leads to a monopolization of public domain information has been considered in literature.

If these and other amendments were made or at least considered further, European database protection could still become a model for respective legislation in other countries of the world. Although the new protection regime has been heavily criticized, it should be borne in mind that the alternative, ie a situation of legal uncertainty, characterized by the overlap of several layers of protection, such as limited copyright protection, flexible unfair competition law protection, protection by contracts as well as by technological protection measures, also has serious shortcomings.

Literature

William Cornish, ‘European Community Directive on Database Protection’ (1996) 21 Columbia-VLA Journal of Law & the Arts 1; Jens L Gaster, Der Rechtsschutz von Datenbanken: Kommentar zur Richtlinie 96/9/EG; mit Erläuterungen zur Umsetzung in das deutsche und österreichische Recht (1999); Matthias Leistner, Der Rechtsschutz von Datenbanken im deutschen und europäischen Recht, Eine Untersuchung zur Richtlinie 96/9/EG und zu ihrer Umsetzung in das deutsche Urheberrechtsgesetz (2000); Mark J Davison, The Legal Protection of Databases (2003); Guido Westkamp, Der Schutz von Datenbanken und Informationssammlungen im britischen und deutschen Recht (2003); Matthias Leistner, ‘“Last exit withdrawal”? Die Zukunft des europäischen Datenbankschutzes nach der EuGH-Entscheidung in Sachen BHB v. Hill und dem Evaluierungsbericht der Kommission’ [2007] Kommunikation und Recht 457; Estelle Derclaye, The Legal Protection of Databases, A Comparative Analysis (2008); Matthias Leistner, ‘The Protection of Databases’ in Estelle Derclaye (ed), Research Handbook on the Future of EU Copyright (2009) 427; Martin Vogel, ‘§§ 87a ff UrhG’ in Gerhard Schricker and Ulrich Loewenheim (eds), Urheberrecht (4th edn, 2010).

Retrieved from Database Protection – Max-EuP 2012 on 19 May 2022.

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