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AI and the creative industries: is our creative future at risk?

Posted on 21 February 2023

Intellectual property frameworks seek to strike a balance between protecting authors' rights and allowing them to exploit their works, whilst at the same time encouraging innovation and new developments. This often precarious balancing act is under the spotlight, due to issues ranging from fast-paced technological developments (notably, the rise of AI, the metaverse, 3D design modelling and changes in content distribution), through to international relations and the aftermath of Brexit.

A recent House of Lords Communications and Digital Committee Report At Risk: Our Creative Futures has highlighted the need to "fix" what it describes as a "policy landscape characterised by incoherence and barriers to success." Particular criticism in the report is directed at proposals, announced in June 2022, to introduce a wide-ranging text and data mining (TDM) exception to copyright infringement, in order to speed up development of AI. Whilst this was said to be in line with its ambition to make the UK a global centre for AI innovation, the Government has now confirmed that it has abandoned the proposal, in the face of criticism from a number of quarters, and that further consideration will now be given to the way forward.

The Report also considers a number of issues which are said to put the UK's 'gold standard' copyright regime at risk.

AI and IP rights of creators

The IP issues that arise in the context of AI have hit the headlines in recent weeks. From the exponential use of Large Language Model (LLM) ChatGPT, through to Court proceedings launched in both the UK and US relating to AI-generated art (see this discussion of the UK proceedings brought by Getty Images against Stability AI), and difficult questions around authorship and originality (as well as inventorship in the context of patents), the use of AI raises complex issues relating to protection and enforcement of IP.

In 2021, the UKIPO consulted on potential changes to the UK's IP framework as a result of AI developments, following a prior Call for Views. In particular, a number of policy options were considered relating to the making of copies for the purposes of text and data mining, a crucial tool in the development and training of AI tools. Currently, an exception is in place under UK copyright law to allow copying for the purposes of TDM, but only where it is for the purpose of non-commercial research and only where the researcher has lawful access to the works.

Alongside retaining the current exception, or simply improving the licensing environment for relevant works, the consultation sought views on three alternative options to revise the exception to:

  • Extend the TDM exception to cover commercial research;  
  • Adopt a TDM exception for any use, with a right-holder opt-out – modelled on the recent TDM exception introduced in the EU. This would provide rights holders with the right to opt-out individual works, sets of works, or all of their works if they do not want them to be mined; or
  • Adopt a TDM exception for any use, with no right-holder opt-out – similar to an exception in Japan for information analysis, and also in Singapore.

In June 2022, the UKIPO published the Government’s response to the consultation, which was in favour of the widest and most liberal of the options under discussion, i.e., a TDM exception for any use, with no right-holder opt-out. Specifically, it was noted that the widening of the exception would ensure that the UK's copyright laws were "among the most innovation-friendly in the world", allowing "all users of data mining technology [to] benefit, with rights holders having safeguards to protect their content". The main safeguard identified for rights holders was the requirement for lawful access.

The House of Lords Committee's Report criticises the TDM proposal, noting the concerns from within the creative industries about potential loss of revenue. It states "the … proposed changes to intellectual property law are misguided. They take insufficient account of the potential harm to the creative industries", calling for them to be paused immediately. On 1 February 2023, in a debate concerning AI and IP, George Freeman (then Minister for Science, Research and Innovation, now Minister for Science, Innovation and Technology) confirmed that the proposals would not proceed. However, he also pointed out that the proposal had not gone out "on a massive limb", given the approach already adopted in the EU, US, Japan and Singapore.

Developments in this space, including further consultations and discussions with stakeholders, should be watched closely in the immediate future.

Performers' rights: AI reproductions

The House of Lords Committee's Report also touches on IP issues arising from AI reproductions of performers. The rise in AI capabilities has led to the ability of being able to create or modify a digital likeness of a performer's image or voice, giving rise to two potential problems identified in the report. First, performers of the original work may not be adequately compensated. The second issue links to the first – it has been argued that current copyright law (the Copyright, Designs and Patents Act 1988) does not provide certainty regarding AI-generated reproductions, with digital 'soundalikes' and 'lookalikes' potentially falling outside the spectrum of copyright protection.

In 2013, the UK signed the Beijing Treaty on audio-visual performances to aid protection of IP rights for audio-visual performances, though this is yet to be ratified following Brexit. The Report highlights Equity's submission that ratifying the Beijing Treaty would be one way of managing exploitation risks and protecting IP in the face of new technologies.

International issues

International trade is an area of vital importance to the UK's post-Brexit future. Whilst the UK's copyright framework has been recognised as an 'international gold standard', the Alliance for Intellectual Property has identified three problems with the Government's approach regarding IP and trade deals, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). These include: (i) inadequate requirements for signatories to prevent piracy and theft of IP rights; (ii) UK artists / rights holders seeing reduced revenue due to potential reductions in the term of protection; and (iii) insufficient provision of artist resale rights.

Allied to this are concerns around the UK's framework for exhaustion of IP rights, particularly if proposals to move to an international exhaustion regime are revived. On leaving the EU, the UK decided unilaterally to continue to participate in the EEA-wide exhaustion regime meaning that goods put on the market in the EEA could continue to be imported to the UK, with rights holders unable to use their IP rights to prevent such parallel trade (except in certain circumstances). However, as the UK is no longer in the EEA, the position is not reciprocated where goods are first put on the market in the UK: in that scenario, relevant IP rights will not be exhausted, and the rights holder can prevent their importation into the EEA. In January 2022, following a consultation as to the future of the UK's exhaustion regime, the Government 'parked' a final decision, citing the lack of data to understand the economic impact of any alternatives to the current regime. An international exhaustion regime, which would see unlimited parallel trade, raises particular concern in the creative sector.

Other IP reforms

The Government's Retained EU Law (Revocation and Reform) Bill is currently making its way through Parliament, with Government departments (including the UKIPO) reviewing the lists of retained EU laws that may be in scope of being 'sunsetted' on 31 December 2023, should the Bill pass. Again, this raises questions as to the potential impact that there may be on those IP laws that are relied upon by the creative industries – such as proposals to reform the UK's approach to protection and enforcement of rights in designs. In that context, technological developments have also been cited as a potential driver for reform, including 3D and 4D printing, and AI.

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