UK Newspaper Licensing Agency In Copyright Court Over 'Link Tax'

by Robin Pilgrim, LawAndTax-News.com, London

18 December 2009

Meltwater Group, a leading "software-as-a-service" company, has announced that it has taken the UK Newspaper Licensing Agency (NLA) to court over what it is considering a “link tax.”

In a statement, Meltwater said that it is pursuing this legal action after the NLA threatened to sue online media monitoring companies who fail to sign up to its new content licensing agreement by January 1, 2010.

"Meltwater has decided to challenge the legal basis of the NLA’s licensing scheme, and in particular the NLA's claim to be able to license hyperlinking, which Meltwater believes has no basis in English law," the company's statement explained.

The NLA, originally formed in 1996, was created to license and collect revenue from the copying and clipping of print media. But, according to Meltwater, the agency is attempting to enforce licensing agreements on sending and receiving Internet links and is targeting both companies providing media monitoring services and the customers subscribing to such services.

“Media monitoring services create value for Internet users similar to search engines like Google, Yahoo, and Bing,” said Jorn Lyseggen, CEO of Meltwater Group. “We use sophisticated search algorithms to help our clients find content they otherwise would have difficulties locating. The NLA’s attempt to license our clients is essentially a tax on receiving these Internet links. This fee is not only unjust and unreasonable, it is contrary to the very spirit of the Internet.”

While Meltwater says that it "respects the copyright of the NLA's members," it is of the opinion that the licensing scheme seeks to "control the receipt of links to freely published content on the Internet, even though such rights are not legally granted to copyright owners."

Meltwater announced that it is referring the matter to the UK Copyright Tribunal because the company believes that the NLA's licensing scheme has no basis in English copyright law.

In a brief statement posted on its website, the NLA confirmed that its web licensing scheme had been referred to the Copyright Tribunal, but insisted that its approach was "reasonable."

"While we respect their right to take this action, we are confident that the Copyright Tribunal will recognize that our approach has been measured and reasonable. Licensing will proceed as planned from January 1, 2010," the NLA stated.

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