Month: March 2026

Copyright and AI Training: The UK Rethinks its Blatant Content Giveaway Scheme—But What Comes Next?

A robot holding a British flag with the text 'GIVE ME YOUR CONTENT FOR FREE' and 'OPT OUT IF YOU CAN' displayed prominently.

Image: Shutterstock (modified)

On March 18 the UK’s Labour government finally confirmed what everyone has known for months, that its preferred policy option of allowing AI developers to freely use copyrighted content to train their AI algorithms unless rightsholders specifically opt out, was a shambles. The government had been backpedalling for a while but the issuance of the Parliamentary-mandated Report on Copyright and Artificial Intelligence, all 125 pages of it, finally drew a line  under all the prevarications. The paper was issued by the two Departments that represent the opposite ends of the spectrum when it comes to the copyright/AI question, the Department for Science, Innovation and Technology and the Department for Culture, Media and Sport. The inconclusive results reflect this duality.

The government’s initial Consultation Paper had proposed four options to deal with the issue of unauthorized use of copyrighted content to train AI platforms;

  • Do nothing (status quo). Copyright and related laws would remain as they are. It would be left to the courts to settle disputes between rightsholders and unauthorized users;
  • Strengthen copyright by requiring licensing in all cases of use of copyrighted content;
  • Legislate a broad text and data mining (TDM) exception to copyright law. (Britain already has a TDM exception but it is limited to non-commercial research purposes);
  • Create a data mining exception with opt-out and transparency measures. Rightsholders would be required to notify when their works were not to be accessed, and AI developers would be required to disclose what works they had used.

The Paper indicated that the last option, Option 3, was the government’s preferred choice. Unfortunately–for the government–fully 97% of the 11,520 respondents to the consultation survey disagreed. To put it another way, only 3% of respondents endorsed the government’s preferred option. (Note to UK government: Wipe egg off face). Rightsholders did not want the onus to be on them to opt-out (given that copyright law is based on the user, subject to fair dealing and other statutory exceptions, needing to obtain permission in advance from a rightsholder), and because opting out is not necessarily easy to do. AI developers objected to the transparency provisions. They preferred Option 2, a broad TDM exception allowing them to help themselves to whatever content they deemed useful for AI training without let or hindrance. The last thing the tech industry wants is to be required to document what content it has appropriated without authorization. To oppose Option 3, rightsholders mounted a widespread and very effective campaign to remind legislators of the value of Britain’s creative industries, both economically and culturally. Everyone from those two noble knights, Sir Elton John and Sir Paul McCartney, to Ed Sheeran, Dua Lipa, Kazuo Ishiguro, Andrew Lloyd Webber, Cat Stevens, Sting, Tom Stoppard, and on and on—maybe everyone who is anyone in the cultural world in Blighty, except Banksy, spoke out. Now the government has thrown up its hands and admitted it got it all wrong. The blatant content giveaway cum confiscation is not going to happen, at least not in the form initially proposed.

The Starmer government’s particular slice of humble pie was worded as follows;

We must take the time needed to get this right. We will not introduce reforms to copyright law until we are confident that they will meet our objectives for the economy and UK citizens. This means protecting the UK’s position as a creative powerhouse, while unlocking the extraordinary potential of AI to grow the economy and improve lives. Any reform must ensure that right holders can be fairly rewarded for the economic value their work creates, and that they are protected against unlawful and unfair use of their work. It must also ensure that AI developers can access high quality content. It is clear through the consultation and our subsequent engagement that there is no consensus on how these objectives should be achieved.

Truer words were never spoken. And there will never be consensus as long as one of the parties is an entitled tech industry that feels it can freely confiscate valuable content produced and owned by others, and which has no qualms about accessing pirate websites to do so. Legal consequences are required to bring it to the negotiating table.

Although we now know the UK government will not forge ahead to adopt the Option 3 opt-out proposal, we still really don’t know what it will do. Amidst all the relief from the creative community that Option 3 has been dropped as the chosen way forward, there is still a sense of unease about what might happen instead. Composer Ed Newton-Rex, one of the leading activists amongst the creators, has voiced his concerns on X. While the government has withdrawn its preference for Option 3, it is still on the table as is the possibility of some other form of TDM exception. He is worried that while there is talk of compensation for rightsholders, permission does not seem to be part of the equation. With the dropping (for now at least) of Option 3, transparency requirements for the tech industry are also once again in doubt.

What will happens next on this issue in the UK? More study, more research, more monitoring of developments. In other words, back to Square One. The one new development coming out of the government’s Report is an acknowledgement that something needs to be done with respect to digital replicas. As described in the Report, this involves the use of AI to replicate or mimic the appearance or voice of individuals. Current copyright is not well adapted to protect against such misuse. The result could be the introduction of a right of personality in the UK.

When it comes to the intersection of copyright and AI development, the UK government is trying to resolve an issue with which many countries are grappling. The question is how to get a slice of the AI investment pie by incentivizing the tech industry without throwing the creative community under the bus. In the US, finding the balance has largely been driven by the courts. The White House has just issued its National Policy Statement on Artificial Intelligence. Among its many policy positions, the Statement indicates this question should continue to be left to the courts to decide, even though the White House believes that unauthorized and uncompensated use of copyrighted material for AI development is fair use under US law. In Australia the government looked at the same issue and in the face of vocal and organized opposition from the creative sector, explicitly ruled out introducing a TDM exception. India tried to find the balance by proposing the establishment of an unworkable compulsory licence regime, a scheme that I described in a recent blog post as the “worst of all worlds”. It was as widely condemned by both creators and tech developers as the UK’s Option 3. Canada, which like Australia does not have a TDM exception in its copyright law but which is being pushed by the tech industry to loosen restrictions in the face of current and anticipated lawsuits, is facing similar questions.

While this may seem to some (like the UK government for example) as an almost intractable problem that will require much more work, study and consultation to resolve, in fact it is not all that difficult. Cultural industries generally are not opposed to the development of AI. In fact, many creators use it to assist their work. But they want to have some say over whether or how their work is being used and want to receive compensation when it is used. It is true that some individuals may wish to have nothing to do with AI and would like to see it go away. That, however, is not going to happen although their right to have their work not used to develop applications that may unfairly compete with the content they produce must be respected. The best outcome is a win/win scenario where creators voluntarily opt in to the AI development process and share in its benefits. This is already happening on an increasingly large scale with respect to commercial licensing deals, with news media outlets, studios, music publishers and book publishers all signing licensing agreements with AI developers. Left out at this stage are most individual authors and artists and small publishers, but voluntary collective licensing can fill the gap. As a recent example, at the recent London Book Fair in March of this year, the first stage of an opt-in collective licensing initiative was launched by Publishers Licensing Service to supplement direct agreements between publishers and AI companies.

The “magic formula”–the win/win solution–which so many countries are finding so hard to unlock is based on three principles, well articulated by Canada’s Coalition for the Diversity of Cultural Expression (CDCE);

1. Authorization (Permission)

2. Licensing (Remuneration)

3. Transparency (Disclosure)

Acceptance of these three cardinal principles by AI developers would cut through what the UK government seems to see as a Gordian Knot. The solution is not all that difficult, but it requires courage to stand up the tech industry’s threat of taking their ball and going elsewhere to play. Let’s hope that as the UK and other governments go back to the drawing board, they use these principles as guideposts to arrive at a solution that, at the end of the day, best serves everyone.

© Hugh Stephens, 2026. All Rights Reserved

Another Self-Proclaimed “Robin Hood” Platform Taken to Task: Anna’s Archive Sued by Thirteen Publishers

A stylized illustration of a man in a green tunic and hat, looking thoughtfully to the side with one finger on his lips, against an orange dotted background. He carries a quiver of arrows on his back.

Image: Shutterstock (modified)

Earlier this month, thirteen publishers sued Anna’s Archive (a website that provides access to pirate libraries) for copying and distributing millions of infringing files, both books and research journal articles. Anna’s Archive claims to host over 63 million books and 95 million articles on its site. Like a number of other providers of pirated content, the Archive presents itself as a non-profit seeking altruistically to provide open-source knowledge to all and sundry. It is more than happy to provide unauthorized access to OPC (Other People’s Content). Not only that, it disclaims responsibility for any copyright infringement that occurs because it only links to its sources, although they happen to include the world’s best-known pirate libraries. On its website it states that it mirrors or collaborates with Sci Hub, Library Genesis (LibGen) and Z-Lib, all notorious pirate sites, while it scrapes Hathi, Internet Archive and DuXiu. Some of these sites, to be sure, offer legitimate content, or a mix of copyright infringing and non-infringing material. Others, such as Sci-Hub (which I wrote about here), offer almost exclusively infringing (i.e. pirated) content. This action by the publishers marks the latest move in the endless struggle to preserve authors’ and publishers’ rights against copyright opponents who use the smokescreen of “free, public knowledge” to undermine legal protections for authors.

The struggle has been going on for years and takes different forms. Each time action is taken, new means to justify piracy and evade sanctions emerge. Anna’s Archive itself was founded only in 2022 out of Pirate Library Mirror (PiLiMi), a digitized library of pirated books. Notably, PiLiMi was one of the main sources for the pirate library compiled by Anthropic to train its AI platform, a direct result of which was Anthropic’s record $1.5 billion class action payout to a group of authors in September of last year. (When the End Does Not Justify the Means, Anthropic’s $1.5 Billion Lesson). While pirate libraries are cheap and easy sources of content for AI training, the results of the Anthropic case highlight the legal risks involved (META beware). The suit against Anna’s Archive will heighten those risks for American AI companies who access pirated content, although it is unlikely to deter Chinese and Russian developers.  

To bring a copyright infringement case, plaintiffs must prove that specific works have been infringed. In the case of Anna’s Archive, the publishers (who license copyright from the authors with whom they have contracted) have listed 130 titles that have been infringed. Under US law, they can seek statutory damages of up to $150,000 per work for wilful infringement, for a total claim of $19.5 million. But it is not the money they are after, knowing full well from past experience that the operators of Anna’s Archive will not appear in court nor will they pay if the court finds against them. The people behind the Archive and their location are not known. Rather the intent of the plaintiffs is to obtain injunctions requiring third parties operating in the US such as hosting and service providers, data centres, and domain registrars to terminate support to Anna’s Archive. Unfortunately, unlike in many countries, the US has no legal provision for site blocking that would enable rightsholders to obtain court orders requiring ISPs to block offshore pirate websites, like Anna’s (which keeps changing its domain registry). But depriving it of hosting and domain services in the US will still disrupt its business. And make no mistake, Anna’s Archive is a business, not a “philanthropic” enterprise engaged in a purist pursuit of knowledge.

While the Archive solicits donations, it also offers premium (high speed) downloads for $200,000 (in crypto currency). It needs to solicit crypto because access to reputable payment platforms has been blocked. Guess where these downloads are going? To AI (LLM-Large Language Model) training. Not only does Anna’s Archive actively undermine the copyright protection that allows authors to earn a living through its unauthorized distribution of copyright protected works, but it further targets the creative sector by facilitating the unauthorized use of such works for AI training. This can result in AI generated works that directly compete with the works on which they were illicitly trained.

As I noted, Anna’s Archive is an aggregator of pirated content from various sources, one of which is Sci-Hub. Sci-Hub’s specialty is the theft of academic journals. Like the operators of Anna’s Archive, those behind Sci-Hub proclaim altruistic motives (“breaking academic paywalls since 2011”) yet what Sci-Hub is really doing is trying to destroy the academic publishing model. This model exists for a good reason. Academic publishing is not only an integral part of academic advancement and evaluation, it is also essential for the dissemination of credible, peer-reviewed research. What is the purpose of research if the results of documented investigation are not published on platforms that are credible? If reputable journals do not exist, how can reliable knowledge and trusted research be made available? There are already enough dubious “pay to play” journals in the marketplace to cause confusion, which is why established journals play such a key role. But to produce quality requires resources–for peer reviewing, editing, secure distribution, and so on.

By and large these tasks are undertaken by a few large-scale, very competent, academic publishers who, not surprisingly, charge for their services. Subscription fees, largely paid by university and other libraries, are the prime source of revenue. Someone has to pay for the work that goes into producing these products. If the subscription model is gutted by the “free” distribution of academic journals, the whole publishing model is undermined to no-one’s benefit. Attacking the business model of academic publishers not only removes the incentives for authors to produce and compete for space in prestigious journals, but it discourages publishers from undertaking the risks of distribution. This clearly does not advance the cause of disseminating knowledge. Indeed, it produces just the opposite effect, a contradiction that seems to have not occurred to the operators of pirate sites who are ostensibly motivated by a desire to freely share the fruit of all human knowledge. Academic publishers have naturally gone after Sci-Hub and, as I wrote last year, it has finally been blocked in India, one of the main jurisdictions where it was widely used. India is not the prime culprit, however. The number one and two countries for use are, respectively, China and the United States.

Another form of piracy that masqueraded as altruistic knowledge-sharing (note that it’s always someone else’s content that is freely shared) was the Internet Archive’s “Controlled Digital Lending” (CDL) model. This was a contrived means to try to justify doing an end run on licensed digital copies of copyrighted works. Under the unproven theory of CDL, it was fair use to lend a digital version of a hard copy work held in a library, substituting the digital version for the original, so long as the original was kept in inventory while the digital copy was on loan. Only one digital copy could be loaned against each copy of the original work. There were, however, several holes in the Internet Archive’s (IA) CDL arguments.

First, it was “an inconvenient truth” that the IA had to make a full unauthorized digital copy of the original work, itself an infringement but also one that damaged the market for the authorized digital version. Second, its argument that a hard copy existed to back up every digital copy on loan was shown to be a fiction. The IA tried to claim the hard copies “on file” were held by established libraries with which it was affiliated (it obtained access to the holdings of these libraries by offering free digitization) but at trial, where it was sued by the American Association of Publishers, it was clearly shown that no records were kept. The supposed one-to-one “own to loan” ratio was never intended to be respected. A final nail in the Internet Archive’s coffin was the fact they generated revenue off the CDL model they maintained.

As in the case of the current suit against Anna’s Archive, only a limited number of works (127 in total) was at issue in the Internet Archive CDL case. These were works to which the publishers held rights, had published e-book versions, and were proven to have been infringed. Despite this, the court’s decision in favour of the publishers, which was upheld on appeal, knocked the wind out of the CDL model. It hasn’t completely gone away (there are still some in the US who argue it may be valid in certain contexts) and it has never been litigated in Canada. However, after the US decision, I concluded that its legal status in Canada was unclear but risky. Many libraries are not happy with the existing e-book licensing model, but CDL is not the answer.

These schemes to freely disseminate “knowledge” (i.e. OPC, often created with great effort and at considerable expense by a rightsholder) are not as altruistic as they purport to be.  All use someone else’s work to generate revenue. Sometimes this revenue is in the form of “donations”, but how much of the donated funds go to maintain the illicit operations and how much to other purposes is by no means clear. In any event, to steal in the name of charity, or to claim to be redistributing property (such as published works) as a self-appointed Robin Hood, is a thin excuse. All of these schemes have the effect of undermining the lofty goals they claim to support.

If the publishers win their sought-after injunctions against Anna’s Archive, it will be another attacking move in the digital chess game of pirate v. publisher (with the AI industry looking on as an interested observer). The Internet Archive case, Sci-Hub and now Anna’s Archive are all examples. Canadian publisher Kenneth Whyte of Sutherland Press traces it back even further to the 2004 Google Books case.

Frustrating as it may be for authors and publishers, taking on these pirate redistributors of other people’s copyrighted content ad seriatim is the only way to preserve the integrity of the ecosystem that produces the knowledge we all use and benefit from–knowledge that is encouraged, incentivized and protected by copyright. The self-righteous Robin Hoods, whether it’s the Internet Archive, Sci-Hub or most recently, Anna’s Archive, not only threaten to destroy the very system they profess to be promoting, they are also not averse to filling the purses they have hidden beneath their outlaw’s cloaks.

© Hugh Stephens, 2026. All Rights Reserved.

Why the High Court of Justice Denied UK Broadcast Royalties to US Performers

A cartoon-style judge with white curly hair, wearing a black robe and a white collar, is raising a gavel with a serious expression. The judge has a small Union Jack flag on their robe.

Image: Shutterstock.com

In my most recent post, I wrote about the unsuccessful effort of the American Federation of Musicians (AFM) to overturn a British regulation that ensured US performers would continue to be denied payment of royalties for recordings broadcast over radio in Britain. The British action came after a public consultation and was based on the principle of material reciprocity; British performers are denied those same benefits in the US. This also ensures that royalty revenues that otherwise would have gone to US performers are distributed in Britain as long as British performers in the US are not entitled to receive royalties for their recordings. While Britain has long maintained a policy of material reciprocity (in effect, treating US performers as badly as the US treats its own and foreign performers), the AFM saw an opportunity to bring a legal challenge because Britain had just expanded the mutual recognition of royalty rights for performers as a result of its accession to the CPTPP Trade Agreement (the Comprehensive and Progressive Agreement for Trans-Pacific Partnership). This is the sequel to the earlier blog post.

As part of the part of legislation introduced to implement its accession obligations to the other eleven members of the Agreement (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam), the UK agreed to grant national treatment with respect to royalties to performers from those countries, and to performances first published in those countries. As reported by the International Comparative Legal Guide;

“Parliament amended the Copyright, Designs and Patents Act 1988 to widen the circumstances in which performances would qualify for protection, including where recordings were first or simultaneously published in a qualifying country. Those amendments appeared to extend statutory rights to a broader class of foreign performers, including those from the United States.”

To close this potential loophole, regulations were subsequently passed allowing the UK government to impose restrictions limiting the scope of the amendment to nationals of CPTPP member states only. Ironically, even though the US was the original inspiration for the Trans-Pacific Partnership, which later became the 12 nation CPTPP, the United States is not a member because–in his first act as President in 2017–Donald Trump announced the US was withdrawing from the Agreement. To ensure that benefits arising from the CPTPP apply only to citizens of countries that are members of the Agreement, the British government clarified and narrowed the grant of national treatment through the Copyright and Performances (Application to Other Countries) (Amendment) (No. 2) Order, 2024. (the “Order”). This legislative word salad is hard to decipher but the end result was the continued exclusion of US performers, reflecting the concerns of the British music community. In a further twist, British law allows the payment of royalties to US producers, but not performers. The AFM challenged the Order.

The AFM claimed the Order conflicted with three international treaties, the Rome Convention of 1961, the WIPO Performances and Phonograms Treaty (WPPT) and the CPTPP, even though the US is not a Party to two of these, the Rome Convention and the CPTPP.

In the case of the Rome Convention, the claimants’ case, as summarized by the Court, (Para 24) was that:

“…since 1963, the UK has been obliged by the Rome Convention to provide for payment of equitable remuneration to US national performers whenever a phonogram carrying their performances is published in a Contracting State within 30 days of its first publication, regardless of the fact that the US is not a party to the Convention and regardless of the fact that US law provides for no equivalent right to UK performers when phonograms carrying their performances are broadcast or played to the public in the US.”

The Convention requires granting of national treatment to performances that are published in a contracting state within 30 days of original publication, regardless of the nationality of the artist, unless the contracting state has opted out. In 1963 Britain declared that it would not grant national treatment to recordings produced by a national of a non-Contracting State, but with a caveat “unless…the phonogram has been first published in a Contracting State…”. That state must also have not opted out of national treatment. The AFM claimed this wording meant that broadcasts in the UK of recordings produced in the US that had also been published in a Rome Convention country simultaneously or within 30 days of original publication qualified for equitable remuneration (royalties). Most US recordings are usually released abroad within a month of their US release.

In the case of the WPPT, to which both the US and UK have acceded, national treatment is required unless a derogation has been noted. A derogation would allow a member to restrict royalty payments if not provided reciprocally. However, the UK has made no such derogation.

Finally, with regard to the CPTPP, the claimants’ case was based on the fact that if a phonogram was first published in a CPTPP member state, (e.g. Canada), it should be accorded national treatment regardless of the nationality of the performer. This is reminiscent of the “Backdoor to Berne” used by US book publishers before the US acceded to the Berne Convention in 1989, whereby they simultaneously published in Canada to get the benefits of the global protection afforded by membership in the Convention, even though the US was not a member.

On the face of it, the AFM’s arguments would seem to have legal logic even if the end result would be to give US performers rights that they and foreign performers do not enjoy in the US. The validity of their arguments was further reinforced by the fact that the British government, subsequent to the passage of the 2024 exclusion Order, amended its reservation to the Rome Convention to remove the controversial wording of “unless…the phonogram has been first published in a Contracting State…etc”. But in any event, the AFM’s claims were all dismissed–but not because the Court rejected the arguments on their merits. The case was dismissed because the treaties referred to have not been incorporated into British legislation.

Under UK law (and US law too, for that matter), treaties are not self-executing. Their provisions must be enacted into domestic law insofar as legal changes are required for treaty compliance. An example would be changes to the Customs tariff. Changes are made to domestic legislation to implement a treaty only to the extent necessary. The full text of a treaty is not enacted into legislation. A treaty is not binding with respect to domestic law; legislation is. The full text of a treaty is a document in international law, but it is not necessarily part of the corpus of domestic legislation. In legal terms, the treaty is “unincorporated” in terms of domestic legislation. As explained by Google’s AI overview, which is probably about as concise a definition as you are going to get:

“An unincorporated treaty is an international agreement ratified by a state’s executive branch but not formally enacted into domestic law by its legislature (e.g., Parliament or Congress). While binding internationally, these treaties generally do not create enforceable rights or obligations for citizens in domestic courts.”

Or, to quote from the Court’s decision (para 117)

“It is to be expected that the UK government will seek to comply with the UK’s international obligations as it understands them to be, but the fact that it says so (either of its own motion or in response to questioning, and with whatever degree of emphasis or conviction) does not turn the provisions of unincorporated treaties into a source of rights and obligations in domestic law”.

Thus, the AMF challenge failed. It was the view of the British High Court of Justice that here is no requirement in British law to grant national treatment royalty rights to US performers for music broadcast in the UK, despite whatever treaty obligations the UK may have taken on. Note the similarity to the Irish Music Case in the US that I referred to last week. The US was found to be in default of its international obligations under the WTO but because the US Administration was unable to get Congress to amend US law, Irish musicians have been blowing their tin whistles in vain for more than two decades. With respect to performance royalties, as I noted in last week’s blog post, maybe it’s time the AMF redoubled its efforts to fix the problem at home. The Court in effect suggested this was the solution; (Para 69)

“…the reason why US performers receive no such remuneration is that US law does not provide equivalent rights to UK performers. The position would be different if US law were to provide for reciprocity in this respect…”;

Once the US treats performers with the same respect and benefits as the rest of the world, these issues of material reciprocity vs national treatment would quickly disappear.

© Hugh Stephens, 2026. All Rights Reserved.

US Musicians Unsuccessfully Seek Royalty Benefits in UK they are Denied in US: Maybe They Should Fix the Problem at Home?

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US artists and musicians, unable to get Congress to grant them royalties for their performances broadcast over terrestrial radio networks in the US, continue to try to obtain in foreign countries what they cannot get at home. Sometimes they have been successful, as in the case of Canada where as part of the update of NAFTA and its replacement by the Canada-US-Mexico (CUSMA) Agreement (or USMCA if you prefer) in 2020, Canada granted US performers “national treatment”. This means they get treated “no less favourably” than—i.e. just as well as—Canadian performers with respect to royalty payments. In other words, they get paid.  Canadian performers in the US also get national treatment, which means they get treated just as badly as their US counterparts, receiving no royalties at all when their music is broadcast terrestrially. The US music industry, or at least the part of it affected by US restrictions on royalty payments (performers and labels), has long lobbied to remove this inequity. A few years ago legislation designed to fix this problem, the American Music Fairness Act, or AMFA, was introduced into Congress. As I explained at the time;

“US terrestrial radio stations are not required to pay royalties to performers or labels for playing recorded music on air. Online broadcasters and streaming services do, but not over-the-air AM/FM radio stations. Terrestrial stations do, however, pay royalties to composers and songwriters for music played on air, but not to performers.”

It is a strange, assymetric exemption from the requirement to pay royalties. Passage of AMFA would close this loophole by ensuring that performers (artists, singers and musicians) as well as owners of the sound recording copyright, normally labels, receive royalties when a work is broadcast commercially on terrestrial radio. But the AMFA bill, and successive versions introduced since, did not make it across the finish line.

If this seems odd and inequitable, it is. It relates to the influence of the National Association of Broadcasters (NAB) in Congress. For decades the NAB has managed to block legislation that would fix this anomaly by arguing that terrestrial stations provide “free airtime” that promotes new recordings. This is a specious argument akin to the canard that platforms distributing pirated content promote legitimate business by giving new content greater exposure. If the “free exposure” argument was ever valid, it is no longer in a world where new music is promoted on digital radio channels and through Spotify, YouTube and Tiktok. Nowadays, triggering algorithmic discovery is key, yet over-the-air radio stations are still getting a free ride when playing recorded music. Given the strength of the NAB lobby don’t look for AMFA to pass Congress any time soon, despite the concerted efforts of the American Federation of Musicians. And it is not just a US problem. Not only do US performers not get paid when their music is broadcast terrestrially on radio in the US, neither do non-US performers or labels. This leads to another dimension of the issue.

The failure to allow foreign performers to collect royalties in the United States usually has a knock-on effect for US artists when their music is played abroad–unless the US has been able to obtain national treatment through a special bilateral agreement. Performers’ organizations in other countries object to US musicians being granted royalties in their own country because if US artists gain access to a national royalty pot, the amount paid out to domestic performers is reduced (by the amount paid to US artists). When US artists are denied royalty payments on the basis of reciprocal as opposed to national treatment, the collected royalties that would normally go to American performers are redistributed to domestic counterparts or retained by performing rights organizations for the benefit of the domestic music industry as a whole. Normally, payments going to US performers abroad would be offset by payment of royalties in the US to foreign musicians–and everyone would gain–but because of US legislation, the US royalty revenue stream for this music category is non-existent, for everyone. Therefore, from the point of view of domestic musicians, it is unfair for US artists to expect a benefit abroad that is denied to foreign performers in the US. International copyright treaties allow for withholding of national treatment benefits under the principle of material reciprocity. Put bluntly, this means that “If you withhold royalty payments from our performers, we will do the same to yours”.

While material reciprocity is a well recognized principle of international copyright, it’s not all that simple because there are provisions in some international treaties that require national treatment (i.e. payment of royalties) for recordings based on where they are first released even if the artists themselves are from countries (like the US) that deny royalty benefits. This would override reciprocity provisions. In 2020, the EU Court of Justice ruled that denial of royalties to US performers in Ireland on the basis of reciprocity was inconsistent with EU law, which does not mention reciprocity. Since then the Netherlands and Sweden have dropped the reciprocity rule and allow payment to US performers, but most EU countries still do not. Nor does the UK, a non-EU member since January 31, 2020.

It is ironic that Ireland was the jurisdiction where US performers made a legal breakthrough in terms of overseas royalty payments given the WTO Irish Music case. Here the US continues to ignore a WTO panel finding made over 25 years ago, in 2000. The WTO panel ruled that another royalty exemption, in this case a US law that allows business establishments to play licensed music without royalty payments as long as it is “background music”, is non-compliant with US treaty obligations. The US Administration at the time was unable to get Congress to amend the law and offered to pay compensation, but this lasted only three years. This case remains an outstanding irritant between the US and the EU, with the US continuing to say that it will “work closely with the U.S. Congress and will continue to confer with the European Union in order to reach a mutually satisfactory resolution of this matter.” So far nothing has happened, and Irish musicians are out of pocket at least $1 million dollars a year for Irish music played as background entertainment in US business establishments. (i.e. Irish pubs in the US).

If you are looking for consistency in abiding by trade obligations when it comes to large countries versus small ones, you will be disappointed. The Irish Music Case is a good example of assymetric respect for international trade rules. The Donald Trump technique of respecting trade obligations very selectively, or not at all, is not a new phenomenon, although it is far more apparent today. In any event, if you are an advocate for a particular constituency, such as US performers, consistency is not the issue. Results are. It was in this vein that the American Federation of Musicians (AFM) challenged recent British legislation that denied payment of royalties to US performers. The UK has maintained the principle of material reciprocity for many years, but its recent accession to the CPTPP Trade Agreement (the Comprehensive and Progressive Agreement for Trans-Pacific Partnership) opened the door, or so thought the AFM , to revisiting the issue. They brought forth a number of interesting arguments, but in the end did not prevail. In my next blog post, I will look at the issues raised, and the reasons for the British court’s decision.

At the end of the day, the best solution for everyone would be to close the US loophole. This would eliminate the reciprocity issue once and for all. Maybe it’s time the AFM redoubled its efforts to fix the problem at home.

© Hugh Stephens, 2026. All Rights Reserved.

Korea’s AI Action Plan: Declaring War on Creators?

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In the scramble to jump on the global AI bandwagon, Korea has floated a proposal that would supposedly remove “legal uncertainty” for AI developers who use copyrighted content to train AI platforms. Unfortunately, the proposed “solution” threatens to throw Korea’s globally renowned creative sector under the bus. Nor does it remove the uncertainty.

As part of President Lee Jae-Myung’s National Artificial Intelligence Strategy, its Presidential Council has put forward a 98 point “Action Plan”, a blueprint for implementation. There are many aspects to an AI strategy, but a key element is to ensure legal clarity with respect to the use of content for AI training, especially copyrighted content. The Action Plan purports to do this. Its Point 32 proposes the introduction of “explicit exceptions under the Copyright Act to allow copyrighted works to be used without legal uncertainty (emphasis added) in the processes of collecting and analyzing data available on the web”. In other words, introduction of a copyright exception for text and data mining (TDM), subject to certain conditions such as some form of remuneration, transparency, and opt-out features for rightsholders.

If the goal is to remove “legal uncertainty” regarding the use of copyrighted works, this proposal falls short of the mark. No exception can provide 100% certainty given the Berne Convention requirement that any exception meet the so-called “three step test”, meaning that an exception is permitted only in certain special cases, provided that it does not conflict with normal exploitation of the work and does not unreasonably prejudice the author’s legitimate interests. While there will always be a degree of uncertainty regarding exceptions, the good news is there is a ready alternative. The surest way to ensure legal certainty is to encourage licensing of content from rightsholders. The problem with the introduction of a TDM exception—or even the discussion of a possible TDM loophole–is that it diminishes the likelihood of reaching licensing solutions by reducing the pressure on AI developers to open their wallets to reach licensing deals.

It is even more bizarre that the tech industry is pressing for a TDM exception given that Korea is one of the few countries, alongside the United States, that has adopted a fair use provision in its Copyright law. This was done in 2011 as part of the implementation of the Korea-US Free Trade Agreement after heavy lobbying by the tech sector. Fair use allows courts to make case-by-case judgements as to whether a given use meets fair use criteria, thus potentially allowing reproduction of copyrighted material without advance permission from the rightsholder. If free use of copyrighted material for AI training can be shown to be “fair”, why is a TDM exception needed? Even in countries where fair use does not apply (which is most of the world), there is no convincing case or consensus on the need for a TDM exception; there is even less reason for one in a state that has already adopted fair use.

Point 32 of the Action Plan takes note of the existence of fair use in Korea, commenting that the Ministry of Culture, Sports and Tourism is preparing fair use guidelines. These are to provide interpretive guidance on the exemption provisions of the Copyright Act to enable companies to utilize copyrighted data “with greater confidence”. Despite this, the Action Plan claims these guidelines alone are unlikely to fully eliminate uncertainty and judicial risks. Voluntary licensing, however, would eliminate both.

It is well established that AI developers need vast amounts of data to improve the performance of their AI platforms. To date they have largely employed a “take first, ask later” policy. This has led to numerous lawsuits pitting rightsholders against the tech industry, mostly but not exclusively in the US. AI developers in the US have argued that what they are doing amounts to “fair use” because the final AI product is used for a different purpose from the original and thus does not compete with it. That is highly debatable, especially with image and music-based AI works. To date, the results from the US courts have been mixed.

The legality of the tech industry’s unauthorized use of copyrighted content is an issue that a number of countries, in Asia and around the world, are looking at. Various solutions have been proposed to eliminate the uncertainties that arise from leaving the decision to the courts. Among these are TDM exceptions which have been introduced, albeit with strict limitations, in the UK, the EU and Japan. In the UK for example, use is limited to non-commercial purposes. In the EU, it must be accompanied by transparency requirements and opt-out provisions for authors. In Japan, if the unauthorized user derives commercial benefit from the content, the safe harbour does not apply. Australia has explicitly ruled out introducing a TDM exception in order to protect its creative sector, while many others (eg. India, Canada) have no TDM provision in their copyright law. As noted above, the clearest way to remove any uncertainty about the legality of using copyrighted works is to incentivize and recognize voluntary licensing as the solution. This ensures that rightsholders receive appropriate compensation for the work they have put into creating content, while guaranteeing legal certainty for licensees.

The Korean strategy paper argues that AI companies are required to obtain individual consent from each copyright holder “leading to significant costs and time burdens in securing high-quality training data”. But large amounts of high-quality content can be accessed through voluntary licensing agreements with major content creation companies such as studios, publishers, broadcasters, music labels and so on. As for individual authors and artists, one possibility is to look at the model currently used for licensing print and music content through Collective Rights Management Organizations as a supplement to voluntary licenses signed with major rightsholders.

In addition to being instructed to prepare the necessary amendment to the Copyright Law for presentation to the National Assembly by Q2 of this year, the Culture, Sports and Tourism Ministry, in cooperation with the Ministry of Science and Technology, is to “promulgate standard contract templates for the licensing and transfer of copyrights for AI training”. This is the kind of heavy-handed market intervention that is guaranteed to stifle voluntary licensing. Not only that, it amounts to expropriating the rights of Korean creators to manage their works.

The Action Plan gives a nod to the importance of compensating rightsholders and claims it wants to establish a system that respects the rights of creators. However, given the size and importance of Korea’s cultural industries, from film to K-Pop to literature, it is surprising there isn’t greater recognition of what an important strategic and economic asset this sector represents for Korea. Although the Strategy acknowledges that content industries should be able to share the benefits of growth in the AI industry, the proposed solution is unbalanced and biased toward clearing any so-called “obstacles” to unimpeded use of content. As a result,  just days after the extremely brief (20 day) consultation period on the Strategy had closed, in mid-January sixteen creator and rightsholder groups issued a strong statement condemning the Action Plan, labelling it “an attempt to fundamentally undermine copyright as a private property right”.

While paying lip service to creator’s rights, the Plan does not address how creators can enforce these rights (other than through the creation of opt-out protocols, which stands the normal copyright procedure of seeking permission prior to usage on its head). The Strategy seems to lead to what has been described by many as a “use now, pay later” system, with little information on how payment would be calculated or implemented. On the other hand, prior, voluntary licensing of content for AI training is a solution that would respect the rights of Korea’s creators while providing the welcome revenue sharing and income stream for which the Strategy advocates. Strong content industries benefit AI development in Korea by encouraging continued creation of the valuable Korean language content so necessary to refine and improve AI models. Conversely, providing the tech industry with an escape hatch to avoid licensing by instituting a TDM exception is the surest way to kill a licensing market for AI content. It will only continue the legal uncertainty that the Presidential Council seems to feel is hindering AI development in Korea.

The one-sided formulation of the Strategy to date has provoked an inevitable negative reaction from Korea’s cultural industries. This is not surprising since the strategy of the tech industry, in Korea and elsewhere, is to avoid dealing with ministries directly responsible for culture and copyright and instead lobby industry, technology and science ministries to bring pressure for changes to copyright law. This adversarial stance is unfortunate as the content and tech industries need and can help each other. The Strategy needs to be amended so rather than throwing the cultural and copyright industries under the bus in the name of facilitating AI development, Korea provides the framework for a mutually beneficial and legally certain relationship. This is best done by upholding longstanding copyright principles and encouraging the growth of a voluntary licensing market for content used in AI training.

© Hugh Stephens, 2026. All Rights Reserved