CZECH REPUBLIC
SENTENCE IN THE NAME OF REPUBLIC
Municipal court in Prague decided in senate consisting of the chairwoman JUDr. Eva
Pechová and the judges Mgr. Alena Krýlová and Mgr. Jaromír Sklenář in the case of the
Claimant: Sound Designers - authors´ Protective Association, citizens´ association,
with its registered seat at Lipová alej 747/16, Prague 5, represented by JUDr. Ivan Juřena,
advocate, with his seat at Nábřeží 599, Zlín – Prštné, against the Defendant: Ministry of
Culture, with its seat at Prague 1, Maltézské náměstí 471/1, regarding legal action against
decision of the minister of culture dated 15.1.2004 file No. 10145/2003
as follows:
The decision of the minister of culture dated 15.1.2004 file No. 10145/2003 is cancelled and
the case is referred back to the Defendant for further proceedings.
The Defendant is obliged to pay to the Claimant costs of the proceedings in the amount of
CZK 16,740,- within 15 days after legal force of the sentence, to the legal representative of
the Claimant JUDr. Ivan Juřena, advocate.
Substantiation:
By the decision of the Ministry of culture dated 8.9.2003 file No.: 10145/2003, the Claimant´s
application for license to execute collective management of sound designers´ copyright dated
11.6.2003 was dismissed. The Claimant filed objections against this decision which were
dismissed by the decision of the minister of culture dated 15.1.2004 file No.: 10145/2003. In
the court action the Claimant demanded that both these two decisions are cancelled.
Ministry of culture pronounced in the reasoning of its decision dated 8.9.2003 by which, in its
capacity as the first instance administrative body, it dismissed the Claimant´s application for
license to execute collective management of copyright, that the applicant (the Claimant)
specified, under Section 98 (2) let. c), the object of copyright as follows: the work of sound
designer – sound designer´s work which meets conceptual requirements under Section 2 of
the Copyright Act. In the reasoning of the decision there is described which documents the
Claimant attached to the application and for which documents and information they were
asked by the administrative body. Then the administrative body of the first instance stated
that it had to deal with two principal issues, namely with the question whether the result of
sound designer´s work was capable to be a subject of copyright within the meaning of
Section 2 (1) of the Copyright Act, and further with the question whether, provided that the
result of sound designer work was a subject of copyright, the collective management was
purposeful. Referring to copyright doctrine, the administrative body stated that sound
designer´s activity, whether connected with film, television, radio or theatre production, was
mostly of technical and craft nature, in which the sound designer was lead by the director´s
instructions. The applicant himself also provided as evidence a contract for work regarding
sound designer´s activity, which subject matter was not protected by the Copyright Act. Even
pricing profession of sound designers by a film award cannot prove that the awarded result
meets requirements of the Copyright Act. In such way there also could be awarded a result
which is original, but not unique.
The administrative body referred to Section 98 (6) let. b) of the Copyright Act under which the
ministry grants license to an applicant who asks for a license for representation with
execution of such rights where the collective execution is purposeful. The administrative
body dealt with the application and documents submitted by the n especially from the
viewpoint of usefulness. In the collective managers´ list mentioned for example in the studies
made by World Intellectual Property Organisation (WIPO) about collective management
there is not listed a single collective manager entitled to execute separately sound designers´
copyright. If the result of sound designer´s creative activity is a musical work, their rights are
represented in the limits of granted licence administered the same way as the works of other
musical authors. The same applies in case when the sound designer´s author work forms a
part of an audiovisual work, i.e. the work used audiovisually. The administrative body does
not consider purposeful to execute sound designers´ rights by a separate collective manager.
It is not purposeful even from the point of view of the users, as the contracts, which the
collective manager is obliged to conclude under Section 100 (1) let. h) of the Copyright Act,
would grant the user, for example operator of cable transmission, only with consent to use
sound part of an audiovisual work which cannot be used alone. Therefore it is not purposeful
that such subject exists in the Czech Republic separately. The prerequisite that the collective
manager concludes mutual agreements with similar collective manager abroad who
administers Czech authors´ copyright abroad and vice versa, necessary for the principal
functions of collective management which is to be executed also for foreign authors, is not
met either.
The administrative body concluded in the ending of its decision´s reasoning, that it considers
purposeful to collectively manage the copyright of those authors – sound designers whose
creative activity´s result meet the requirements of protected author´s work, by an existing
collective manager. It stated that it could be Dilia, theatre and literature agency entitled to
collective management of the audiovisual work´s author and authors of audiovisually used
works. At the same time the administrative body stated that for granting license for collective
management there is no legal claim. Dismissal of the application for granting license for
collective management does not form an interference to the subjective rights of the applicant
as the collective management is not a generally permitted activity. Dismissal of the
application does not influence the applicant´s activity as the Sound Designers´ Protective
Organisation which it performs in accordance with its Statute. The applicant may represent
the authors within its agency´s activity which is not subjected to administrative body´s
decision.
The applicant filed objections in administrative proceedings against the first instance
administrative body´s decision, in which they namely disagreed with the administrative
body´s conclusion that there was no legal claim for collective management. They argued that
legal claim for granting licence for collective management is newly embedded provided that
conditions for granting were met (Section 98 (6) of the Copyright Act). They did not agree
with the conclusion that collective management was not generally allowed activity. They
argued that, on the contrary, it was generally allowed activity as no legal regulation did not
include prohibition of copyright´s collective management, but for performing collective
management there was necessary permission in a form of administrative act issued by
relevant body, for which there was a legal claim by fulfilment of conditions stated in Section
98 of the Copyright Act. With compulsive collective management it is notionally excluded not
to appoint collective manager for given subjects of protection, with author´s works also for
given sorts of works, as the individual execution of rights by the right holders themselves is
not allowed. Granting or dismissal of granting the license for collective management must be
supported by reflexion on purposefulness of such rights´ collective management (asked for
by the applicant). As a consequence of legal claim for granting license, the administrative
body, in the process of deciding whether to grant the license or not, may not let to its own
discretion whether the given right to certain subjects of protection (types of works) shall be
subjected to collective management. It is its duty to grant the license if it founds, on the basis
of vague legal term´s interpretation, the right defined by the applicant to be purposeful
collectively managed. The administrative body supported its dismissal by nonpurposefulness of the collective management. Unfortunately, it is not obvious from the
decision, how the administrative body understood vague legal term “purposeful”. The
decision failed legal requirement to consider purposefulness regarding the rights defined in
the application which would be subject to collective management. The administrative body
should have considered each of the rights set up by the applicant, compare to Section 98 (2)
let. b) of the Copyright Act (from the point of view of its purposeful execution).
The Claimant in the filed objections further argued that the administrative body admitted
space for collective management of sound designers´ rights but it did not consider purposeful
that the rights were managed by a particular collective manager. The administrative body
however is not entitled to decide whether it is purposeful to execute the collective
management by a particular collective manager or whether it is more appropriate to assign
the execution to some of the existing collective managers. The law, in relation to the term
purposeful, allows the ministry only to judge whether the applicant asks for license for
representing in exercising such rights where the collective management is purposeful.
Collective management is purposeful in those cases when individual management is not
purposeful, or if the individual management is not allowed. The administrative body considers
purposefulness in relation to a category totally different from the one to which it is related by
the law. By the administrative body, non-purposefulness of independent execution is
supported only with one argument, it believes that collective management is not purposeful
from the point of view of the users as by the collective contracts the user would achieve
consent only to use sound component of the audiovisual work which cannot be used
separately. This conclusion of the administrative body is incomprehensible taking into
account execution of collective management. Contemplations about collective management
of sound designers´ rights by citizens´ association Dilia, theatre and literary agency, are
incomprehensible as well. This entity is not an applicant for execution of collective
management, it never represented sound designers. It is not even entrusted to execute
collective management of rights for “other authors of audiovisually used works”, how it is
distortedly set in the decision. In the end of filed objections the Claimant set that they did not
apply for license to collectively manage musical works. Sound designer´s work is a special
kind of work. If, in a particular case, sound designer´s work is a component of an audiovisual
work, it is audiovisually used, but this sort of works is not yet collectively managed. Author´s
activity of sound designer does not have to be connected with activities of other creative
professions, though it is true that usually it is so, as well as with other creative professions
(direction of photography, scene, costumes, editing etc.). While these other sorts of works
are managed by existing collective managers, sound designer´s work is not, and that is the
reason for the applicant´s application (the Claimant).
The objections were dismissed by the minister of culture in the affected decision. In the
reasoning of the decision it is said that the result of sound designers´ activity cannot be
considered as author´s work as it does not meet requirements set in Section 2 of the
Copyright Act, especially it is not unique result of the author´s creative activity. Though in
particular cases it could be creative activity meeting requirements of author´s work, it is
purposeful in such case that collective management of sound designers – authors´ rights is
managed by already existing collective manager, as the sound component of an audiovisual
work cannot be used separately. The demanded right is not a separate subject of use in the
sense of the Copyright Act´s protection. There is no legal title for granting license because
execution of collective management is not generally allowed activity. This conclusion arises
from historically legal point of view as the mass (collective) management of rights consisting
in granting consents to use of the works and collecting remunerations was performed only by
certain entities which were allowed to do so by administrative body. Collective management
is not entrepreneurship (Section 97 (3) of the Copyright Act) and it is not a trade (Section 3
(1) let. c) of the Trade License Act). Specific regulation for collective management relates to
the fact that under Section 12 of the Copyright Act it is only the author who has the right to
use their work and to grant authorisation to use the right to other person by a contract. Legal
concept of collective management means exceptionally allowed execution of the right by
another person, and therefore it is not possible to deduce legal claim for granting license for
collective management. Taking this fact into account, it is not possible to regard non granting
license as an interference to the applicant´s subjective rights.
As to the issue of purposefulness of the collective management by a separate collective
manager, in the reasoning of the minister´s decision it is said that if the result of sound
designer´s creative activity is musical author´s work, their rights are within limitation of
granted license managed in the same way as the rights of other authors. The same applies
in case that sound designer´s author´s work forms a component of an audiovisual work, i.e it
audiovisually used work. It is not purposeful that these rights are managed separately by
collective manager.
In the court action the Claimant states that considering purposefulness in the way how does
the minister of culture in affected decision directly contradicts Section 98 (6) of the Copyright
Act in connection with the Supreme Administrative Court´s decision dated 10.12.2003, file
No.: 6 A 136/2001 (hereinafter the “SAC sentence”). The only reason for dismissal of the
Claimant´s application was the alleged non purposefulness of the sound designers –
authors´ rights collective management. Neither the decision of the Ministry of culture, nor the
decision of the minister of culture did meet legal requirement set in the mentioned Section,
i.e. the necessity to consider this purposefulness only in cases of voluntary collective
management, that is regarding the rights specified in the petition which would be subjected to
collective management. The administrative body should have consider each of the rights of
so called voluntary collective management specified by the Claimant, comp. Section 98 (2)
let. b) of the Copyright Act (from the point of view of its purposefulness). Wrong legal
conviction regarding the purposefulness of sound designers´ rights collective management
lays, according to the Claimant, primarily in incomprehension of the legal concept of
collective management as such. It applies (comp. with Section 95 (2) of the Copyright Act) in
places where individual execution is not allowed (Section 96 of the Copyright Act) or nonpurposeful (for example Section 101 (9) of the Copyright Act). In cases when the individual
execution is not allowed and where the collective management is compulsive, the collective
management is necessary and purposeful without other conditions. Therefore, if the
applicant asks for license for collective management of those rights which are under the law
subjected to compulsive collective management, then the administrative body is obliged to
grant the license in its decision. The same applies for considering other conditions for
granting license. According to the Claimant, the administrative body should have made this
analysis regarding each particular right which the Claimant mentioned in its application. The
Claimant argues that material conditions for granting license in connection with the condition
of purposefulness are these: the rights in question belong to domain of compulsory collective
management or their individual claiming is unrealistic or difficult to watch (i.e. individual
management is not purposeful).
According to the Claimant, it is crucial whether the result of sound designer´s activity is
capable to become an object of copyright protection. The administrative body came to
conclusion which is generally applicable also in the practice of collective managers who have
to scrutinize at each receipt of representation with each applicant for representation whether
they create in the meaning of the Copyright Act, even whether each object of protection is
really an object of protection (under the doctrine it is necessary to judge nature of the
creation in particular case). The Claimant believes that the administrative body constructs as
other condition for granting license necessity to grant only such consents by the collective
manager on which basis it is possible to use compulsory collectively managed object of
protection separately, though the Copyright Act does not set such condition. In these days
are already managed such objects of protection which use is impossible without notional
connection with other objects of protection (for example works of cameraman, editor etc.).
Regarding the legal claim for granting license for execution of collective management when
conditions set in Section 98 of the Copyright Act are fulfilled, the Claimant refuses repeated
statement of the administrative body that for granting license there is no legal claim, and fully
refers to legal conclusions concerning this issue as expressed in the SAC sentence. Further
the Claimant argues that the administrative body in this case have not listed any reasons for
which it found all rights demanded by the applicant to be non-purposeful for execution of
collective management, the administrative body did not even differ between compulsory
collectively managed rights from voluntary collective management. The Claimant points out
that from the SAC sentence categorically ensues that it is not possible to consider
purposefulness with compulsory collectively managed rights. To consider purposefulness of
collective management in such way that the administrative body declares author´s work of
sound designer to be musical work or work audiovisualy used, and therefore it is not possible
that it is collectively managed, is totally incomprehensible. Work methods of sound designers
are principally different from creation of music authors. In case of sound designers – authors
the work is similar to work of film editor. The Claimant suggested that the court let elaborate
expert evaluation for the result of activity of the right holder Ivo Špajl who was interested in
collective management of his works, for example the series “A je to”.
The Claimant also pointed out the procedural unlawfulness, i.e. insufficient reasoning of the
administrative body´s decision and the fact that during the administrative proceedings the
administrative body did not carry out the proofs suggested by the Claimant.
The Defendant stated in its submission to the filed action that during the first instance
proceedings it acted in accordance with Section 98 of the Copyright Act and was considering
whether the Claimant was capable to proper and purposeful execution of collective
management under paragraph 5 of the legal provision. The result of this proceedings was
finding that in the given case the collective management of sound designers – authors´ rights
by the Claimant was not purposeful. With regard to Section 98 (6) let. b) of the Copyright Act,
there was not fulfilled one of the conditions for granting license for execution of collective
management. The Defendant further stated that it believed that, considering classification of
administrative acts inquired by the Supreme court in Prague in its decision dated 22.9.1995
under No.: 6 A 191/1994-32, there is no legal claim for granting license for execution of
collective management of economic copyright. This opinion is supported by historically legal
point of view as collective management is not generally allowed activity and was always
performed by entities determined by the Ministry of culture on the basis of authorisation in
the Copyright Act. Collective management is not entrepreneurship and it is not a trade.
Regarding the assessment whether the result of sound designer´s activity is capable of being
object to copyright protection, the Defendant came to a conclusion that in each particular
case it was necessary to scrutinize whether the result of sound designer´s creative activity
fulfilled requirements for author´s work set in Section 2 of the Copyright Act. The Defendant
delt with the proceedings from such point of view that sporadically the result of sound
designer´s activity could be artistic musical work and it was not purposeful that in those
cases would come into existence new collective manager in the Czech territory. The
Defendant believes that the right (and also obligation) to execute collective management of
sound designers´ rights already has the existing collective manager which is the Protective
authors´ union for rights to musical works (hereinafter “OSA”). The Defendant at the same
time proceeded from international practice in which there is unknown existence of a separate
collective manager entitled to separate execution of sound designers´ economic copyright.
Establishing new collective managers in cases in which collective manager already performs
its activity on the basis of granted license, would limit or even exclude advantages of
collective management which should not only protect the right holders, but primarily facilitate
concluding license agreements for users of the objects of protection. If the administrative
body referred in its decision to the collective manager Dilia, it was considering so from the
viewpoint of using the sound designer´s author´s work in audiovisual or film piece, because
the Claimant attached to their application evidence referring just to film sound designer´s
work. Constant references of the Claimant to the SAC sentence are, according to the
Defendant, irrelevant in this case. In the given case the Defendant was solving the question
whether the result of sound designer´s work capable of being object of copyright in the
meaning of Section 2 (1) of the Copyright Act, and further question whether in case of
copyright protection of the sound designer´s work result the collective management executed
by the Claimant was purposeful. The Defendant did not interfere by its decision into the
applicant´s rights, nor into the rights of sound designers – authors, it only stated that current
situation allowed the rights of these authors to be managed by existing collective managers.
The Defendant strongly disagrees with creation of new collective managers in cases where it
must be established whether the result of activity is an object of copyright protection, in a
situation when there already exist collective managers who can manage rights of such
authors.
The Defendant further stated that it agreed with the Claimant´s proposal to appoint an expert
and suggested that the Institute of authors´ rights, industrial rights and competitive right of
the Charles University should be entrusted by elaboration of the expert opinion.
The Defendant refused the Claimant´s procedural objections and stated that the proofs which
were carried out were sufficient. The Defendant also refused the Claimant´s statement that
the minister´s decision is insufficient and unreviewable for lack of reasoning, and it
expressed its conviction that the administrative file contained facts allowing to judge from
which documents the minister proceeded and by which factual and legal considerations he
was lead. The Defendant therefore suggested that the action should be dismissed by the
court.
In the reply to the Defendant´s submission the Claimant stated that if the Defendant admitted
that the result of sound designer´s activity “sporadically” fulfilled notional requirements of
author´s work, the Claimant considered the proposed expert evaluation as redundant. At the
same time the Claimant stated that if the Defendant presented as the relevant collective
manager for sound designers the organisation OSA, it did it again without any legal
foundation. OSA does not manage sound designers´ works, it does not represent any sound
designer, and its license granted by the Defendant under Section 98 of the Copyright Act do
not affect sound designers´ works. OSA traditionally manages musical works with lyrics or
without lyrics. However, nobody has represented sound designers´ interests to date and,
unlike the Claimant, even is not professionally capable to perform proper collective
management of these authors rights. The idea that sound works could be managed by Dilia
is also groundless. The argument that granting license to more collective managers would
deny advantages of collective management, is totally utilitarian and baseless. According to
the Claimant, by arbitrary imposing further condition for granting license the ministry
breached Article 26 of the Bill of basic rights and liberties which guarantees to the Claimant
to “perform other economic activity”. Collective management can be considered as such if it
does not constitute entrepreneurship. Legal claim for granting license under Section 98 of the
Copyright Act means that the ministry only reviews fulfilment of the conditions set by the law,
not that it will set after its administrative consideration further conditions. Section 98 (6) let. b)
of the Copyright Act does not set condition of independence but it demands condition of
purposefulness of the collective management, i.e. non-purposefulness of the individual
management. Sound designers consider compulsory collectively managed rights as
purposeful ex lege and other demanded rights as purposeful for collective management
through protective organisation which was founded for them.
The Defendant in its statement to the reply said that the Defendant´s reference to the
collective manager OSA was well placed if it concerns activity of sound designer creating
artistic author´s musical work. In case that the sound designer´s activity is only of technical
nature, though it was the best result of professional sound designer´s work awarded in film
competition, the Copyright Act does not apply to such work result and in its respect the
economic copyright under Copyright Act may not be claimed. It is the Claimant who could be
found professionally incapable to collectively manage economic copyright, because it
considers sound designer´s activity in general as author´s activity, despite cases when the
activity is purely technical. The Defendant further stated that, according to it, the Article 26 of
the Bill could not be applied in respect of collective management because under Section 97
(3) of the Copyright Act the collective management was not entrepreneurship and under
Section 100 (3) of the same Act the collective manager represented right holders under its
name and on their account; it performs collective management non profitably and was
entitled only for compensation for effectively spent costs and general assembly of the
represented authors decided on its amount. Collective manager is only such entity which
achieved license for collective management, the ministry of culture decides on granting such
license.
The Claimant reacted to the Defendants statement by other reply in which they repeated
again that, according to the, sound designer´s work was not a musical work, these were two
separate kinds of works. The Claimant is convinced that the Defendant´s argument that
“sporadically the result of sound designer´s activity meets notional requirements for author´s
work” confirms legitimacy of the filed claim. The same conclusion could be pronounced also
in the direction of the results of cameramen´ activity, though there exists collective manager
for cameramen´ works. Under the idea of the ministry, each result of creative nature should
be scrutinized by every collective manager from the point of view of fulfilment of
requirements for objects of copyright protection. That is not possible in practice, moreover it
is necessary to stress that in case of argument over author´s legal quality of certain
intellectual activity´s result it can be decided only by the court. The Claimant further stated
that under Czech legal regulations one collective manager could be entrusted with collective
management of several types of works. No legal entity has been authorized to collectively
manage sound designer´s works. The collective manager OOSA could represent sound
designers provided that it was authorised collectively manage this type of works. However, it
is not so. OSA does not represent sound designers. If the Defendant claims that OSA
represents sound designer because it is authorised to this collective management, then it
should prove how much from the funds collected by OSA from the date of granting license
(February 2001) was collected for sound designers´ account; the Defendant should also
prove how many sound designers are represented by OSA and how it registers them within
its membership files. The Claimant repeatedly totally refused that sound designer´s work
could be confused with musical work and states that the Defendant did not grant any
protective organisation license for execution of collective management of sound designer´s
rights.
The court summoned oral hearing at which the participants persisted on their procedural
statements expressed previously in writing. The Claimant stressed that in the decision of the
minister of culture, nor in the first instance administrative decision, it was not justified which
conditions for granting license, especially in respect of Section 98 of the Copyright Act, were
not fulfilled by the Claimant. The Claimant repeated that for granting license there was a
legal claim.
The representative of the Defendant submitted at the oral hearing written statement of the
Defendant to the Claimant´s reply dated 24.2.2005 and presented its content. He stated that
result of sound designer´s activity may meet requirements of the Copyright Act (Section 2 (1)
of the Copyright Act) only in connection with other author´s work. As the author´s activity of
sound designers is closely bounded with author´s creation by the authors of the works for
example musical, audiovisual, literary, whose rights are already managed by existing
collective managers, it is not purposeful in the given case to grant license for execution of
collective management to a separate entity. In the process of deciding, the Defendant took
into account also the conception of the Copyright Act which traditionally does not expressly
mention so called technical professions (for example editing, sound) how ensues from
Section 104 of the Copyright Act. To the issue of purposefulness the Defendant stated that it
could not be judged only in relation to Section 98 (6) let. b) of the Copyright Act, but primarily
to paragraph 5 of the same legal provision in connection with Section 95 of the Copyright
Act. The Defendant insists that it is not purposeful to grant license for collective management
where result of the activity in question meets notional requirements for object of copyright
protection only sporadically and where, for these sporadic cases, the collective management
can be provided by already existing collective managers. The Defendant still considers
elaboration of expert evaluation as helpful in this case. To the statement of the Claimant that
there exists collective manager for cameramen works, the Defendant said that cameramen
rights are collectively managed but there is not a separate collective manager (in presence
are those collective managers DILIA and OOA-S). Further the Defendant pointed to the fact
that the protection under the Copyright Act could apply only to objects meeting requirements
mentioned in Section 2 of the Act, collective management to those objects which did not
meet these requirements was excluded. The Claimant´s statement that in practice it is not
possible to scrutinize meeting requirements for objects of copyright, only shows that, if they
were granted the license, the Claimant would not meet the demand for proper execution of
the collective management in the meaning of Copyright Act. The summary of licenses for
collective management on which the Claimant demonstrates that none of the collective
managers executes collective management of authors - sound designers, the Defendant
regards as pointless. The Defendant repeats that if the result of sound designer´s activity can
be considered as object of protection, it is always in close connection with other work (for
example musical, literary or audiovisual) for which there exists collective manager who can
represent the creator.
The Municipal court reviewed the affected decision in the limits of the action´s points and
proceeded in it from the factual and legal state which existed in the time of the administrative
body´s decision (Section 75, paragraphs 1, 2 of the Act No. 150/2002 Coll., administrative
procedure act (hereinafter a.p.a.) and after hearing the evidence it came to conclusion that
the action is well founded.
Regarding the term purpose and purposefulness of collective management the court
reasoned as follows:
The purpose of collective management is, under Section 95 (1) of the Copyright Act,
collective claiming and collective protection of economic copyright and rights connected with
copyright and facilitating communication of these rights´ objects to the public.
Collective management means, under Section 95 (2) of the Copyright Act, representing
higher amount of persons to which belongs a) economic copyright or right connected with
copyright, b) authorisation to claim economic copyright to work, ensuing from the law
(Section 58), or c) exclusive authorisation to execute right which is compulsory collectively
managed for the whole term of duration of economic copyright, at least for the territory of
Czech Republic, with right to grant sub-license, ensuing from a contract (hereinafter the “right
holders”) to their common benefit, namely with execution of their economic copyright to
published works or works offered to publication, artistic performances, sound and audiovisual
records (hereinafter the “objects of protection”), if other than collective execution of those
rights is not allowed (Section 96) or is non-purposeful; object of protection offered to
publication is such object of protection which is notified in writing to the collective manager in
order to be put in the registry of objects of protection.
Under Section 98 (1) of the Copyright Act, the decision on the granting of authorisation to
execute collective rights management (hereinafter the “license”) shall be made by the
Ministry of Culture (hereinafter the “ministry”) upon a written application.
Under Section 98 (5) of the Copyright Act, decision concerning the application for the
granting of license shall be made by the ministry within 90 days of the submission of the
application. During the proceedings the ministry shall take into account, in particular,
indications of the applicant’s competency in orderly and purposeful execution of collective
rights management.
Under Section 98 (6) of the Copyright Act, the ministry shall grant the license to an applicant:
a) whose application for the granting of the licence meets the requirements set out in
paragraphs (2) and (3), b) who has applied for license for representation in exercising such
rights as can be collectively exercised in a purposeful manner, c) where no other person has
acquired license for the same object of protection and, in the case of works, no other person
has acquired authorisation for the exercise of rights in respect of the same type of work, and
d) who has the prerequisites for ensuring the orderly execution of collective rights
management.
From the above mention it is clear that Section 98 (6) of the Copyright Act to which the
Claimant refers in the filed action, does not stand isolated in the law and it is not the only
legal provision which speaks about purpose of the collective management, or more
preciously about purposeful execution of collective management. The purpose of the
collective management is not only collective claiming and collective protection of economic
copyright, but also facilitating communication of objects of those rights to public (Section 95
(1) of the Copyright Act). The court agrees with the Claimant that collective execution of
those rights which are under the law compulsory collectively managed (Section 96 (1) of the
Copyright Act) is always purposeful. Purposefulness of collective management is one of the
conditions for granting license, namely the condition set in Section 98 (6) let. b) of the
Copyright Act. Under this legal provision it is necessary to consider the purposefulness in
relation to the rights which are to be collectively managed, and it is clear that if the lawgiver
set regime of compulsory collective management for certain rights, it considered their
collective management purposeful and the administrative body may not, in case of these
rights, scrutinize purposefulness of collective management of such rights. The lawgiver
however used the term purposeful execution of collective management also in provision of
Section 98 (5) of the Copyright Act under which the ministry should during the proceedings
on granting license take into account indications of the applicant’s competency in orderly and
purposeful execution of collective rights management. This legal provision therefore does not
connect assessment of purposefulness to the rights which are to be collectively managed but
to assessment of the person of the applicant who filed application for license for execution of
collective management. The law so does not set as a prerequisite for granting license only
for conditions mentioned in Section 98 (6) let. a) – d), but as further prerequisite it set in
Section 98 (5) also condition that the applicant is capable to purposefully execute collective
management. The purposefulness of execution of collective management in relation to the
person of applicant must be, according to the court, assessed in connection with Section 95
(1), under which the purpose of collective management is not only collective claiming and
collective protection of economic copyright but also facilitating communication of objects of
protection to the public. Therefore, it is not possible to deduce from wording of Section 98 (6)
of the Copyright Act (the ministry s h a l l grant) that the applicant has, under fulfilling
conditions set in let. a) – d) of the legal provision, a legal claim for granting license for
execution of collective management, because the administrative body (the Ministry of
culture) under paragraph 5 of the same legal provision takes into account also other
prerequisites (capability of the applicant to proper and purposeful execution of the collective
management).
As the administrative procedure act does no longer include legal provision under which the
court does not review “decisions on applications for performance for which there is not a
legal claim” (Section 248 (2) let. i) of Civil procedure act in the wording valid till 31.12.3002),
the court does not consider the question whether there is a legal claim for granting license for
execution of collective management to be principal. The court proceeds from the fact that
granting license for execution for collective management is considerational decision of the
administrative body in which the administrative body is bound by the law, by viewpoints set in
law. The court reviews such decision in respect whether the administrative body has not
exceeded limits for consideration set by the law or whether it has not abused them (Section
78 (1) of a.p.a.), whether the decision is in accordance with rules of logic reasoning and
whether premises of such conclusions were established in proper procedure.
Under Section 98 (8) of the Copyright Act, the decision on the granting of the license shall be
governed by general regulations on administrative procedure unless otherwise provided in
this act. As the Copyright Act does not include special provisions regarding requisites of a
decision on application for granting license for execution of collective management, the
Section 47 (3) of the administrative order shall apply which provides that the administrative
body states in the decision which facts were foundation to the decision and which
considerations lead them in assessment of the evidence and in application of legal
regulations on which basis they took the decision.
In the heard case the principal issue is to which extent the sound designer´s activity result
could be considered to be author´s work in the meaning of Section 2 (1) of the Copyright Act.
Administrative bodies of both instances proceeded from the view that sound designer´s
activity is mainly of technical, craft nature, in which sound designers are led by director´s
instructions, the result of sound designer´s activity may create artistic work only sporadically.
Further it ensues from the reasoning of administrative bodies´ decisions that, according to
them, eventual author´s activity of the sound designer cannot be separate object of use but it
is either component of an audiovisual work or it is musical work. The administrative bodies
considered purposefulness of collective management of sound designers – authors´
economic copyright executed by the Claimant from this point of view. The administrative
body of the first instance concurrently referred to Section 98 (6) let. b) of the Copyright Act.
Both administrative bodies identically came to conclusion that they did not considered
purposeful that sound designers – authors´ rights were managed by a separate collective
manager, because they held purposeful that economic copyright of those sound designers –
authors whose creative activity´s result met requirements of protected author´s work were
managed by existing collective managers. The administrative body of first instance stated
that into consideration came Dilia, theatre and literary agency authorised for execution of
collective management for authors of audiovisual work and authors of work audiovisually
used. Minister of culture as appellate administrative body noted that if the result of sound
designer´s creative activity formed musical author´s work, their rights were in the limits of
granted license managed as the rights of other musical authors, the same applied in case
that author´s work of sound designer was a component of audiovisual work, i.e. audiovisually
used work.
The Claimant argues in the filed action that considering the purposefulness in the same way
as did the minister of culture, directly contradicts Section 98 (6) of the Copyright Act, that the
administrative body considers purposefulness in relation to totally different category then the
category to which it is bound by the law and that the administrative body is not entitled to
judge whether separate execution of collective management of sound designers´ rights is
purposeful or if it is more appropriate to assign the execution to some from the existing
collective managers. The administrative body supports the non-purposefulness of separate
execution of collective management non-purposefulness from the point of view of the users.
As to this action´s objection, the court refers to what it has stated above regarding
interpretation of the terms “purpose” and “purposefulness of execution of collective
management” and it repeats that, in its understanding, assessment of purposefulness of
collective management may not be limited to application of Section 96 (6) let. b) of the
Copyright Act which deals with assessment of whether it is purposeful to collectively manage
particular right listed in the application. Under paragraph 5 of the same provision the Ministry
of culture is obliged, and therefore also entitled, take into account indications of the
applicant’s competency in orderly and purposeful execution of collective rights management.
It means that the Ministry of culture is entitled to assess indications of the applicant’s
competency in purposeful execution of collective rights management, as the purpose of
collective management is effectively manage economic copyright of the authors and right
holders of the connected rights, exercise protection of these rights and also communicate
objects of protection to public (Section 995 (1) of the Copyright Act).
The court however finds well-grounded those objections of the Claimant in which the
Claimant points out to insufficient reasoning of the administrative body´s decision.
Administrative bodies of both instances come to conclusion about non-purposefulness of
execution of collective management by the Claimant as a separate collective manager when,
according to them in sporadic cases when result of sound designer´s activity has character of
object of protection under the Copyright Act, it is possible to provide protection through
already existing collective managers. The administrative body of first instance in its
decision´s reasoning mentions Section 98 (6) let. b) of the Copyright Act, the minister of
culture as appellate body in his decision´s reasoning does not mention any Copyright Act´s
provision. As was above explained in detail, Section 98 (6) let. b) of the Copyright Act relates
to purposefulness of collective execution of particular rights listed in the application for
granting license. If the Defendant admitted that result of sound designer´s activity could
sporadically have character of object of protection under the Copyright Act, and if it was
applied for granting license for execution of collective management also of compulsory
collectively managed rights, in case of these rights is their collective execution undoubtedly
purposeful. Moreover, the administrative bodies have not dismiss the Claimant´s application
because collective execution of particular rights listed in the application would not be
purposeful, but they dismissed it because it is not purposeful that the rights would be
managed separately as they found purposeful that they are managed by already existing
collective managers. However, neither the Defendant´s decision nor the minister of culture´s
decision includes reference to Section 98 (6) let. b) of the Copyright Act and they do not state
that for the same object of protection or for the same kind of work some other person has a
license, and which person in particular. In the minister of culture´s decision it is only generally
stated that if the result of sound designer´s creative activity forms musical author´s work,
their right is managed as other musical authors´ rights (it remained unclear whether it was
possible to identify sound designer´s author´s work with musical work) and the same applies
according to the Defendant in case when sound designer´s author´s work is a component to
audiovisual work. The Defendant in the first instance administrative decision states that for
example Dilia, theatre and literary agency authorised to execution of collective management
of audiovisual work´s authors and authors of work audiovisually used could be such existing
collective manager. From decisions justified this way it yet cannot be found whether the
authors – sound designers can register into evidence of existing collective managers or
conclude with them agreement on management of other than compulsory collectively
managed rights (Section 95 (2), Section 96 (3) of the Copyright Act).
If the Defendant admitted that in some cases the result of sound designer´s activity could be
author´s work, and if some economic copyright or rights connected with copyright can be
executed only by collective manager, than without existence of a collective manager these
rights concerning negotiations and collection of remuneration cannot be executed at all. If the
Defendant argues that protection of sound designers – authors can be provided through
already existing collective managers, such conclusion must be tangibly and comprehensibly
justified. Neither the Defendant´s decision, nor the minister of culture´s decision met this
requirement. In this course both decisions are unreviewable for lack of reasons and it is not
possible to agree with the Defendant that the administrative file contains foundations for the
conclusion made by them.
For making the Defendant´s decision in the case, for assessment of purposefulness of
granting license for execution of collective management to the Claimant, it is in the court´s
understanding also necessary to assess in more details to what extent the result of sound
designer´s activity can be object of copyright protection and whether the result of sound
designer´s activity may fulfil requirements demanded by the Copyright Act only in connection
with other author´s work and whether author´s work of sound designer can be identified with
musical work. The court shares the meaning of both the Claimant and the Defendant that
foundation for decision of the administrative body should be supplemented by expert
evaluation or specialist review, and it is up to the Defendant to cope with procedural
proposals of the Claimant to review evidence and to justify who and why it entrusted with
elaboration of the expert evaluation or specialist review.
For all above mentioned reasons the court cancelled the Defendant´s affected decision
because of procedural defects (Section 78 (1) of a.p.a.) and returned the case back to the
Defendant for further proceedings (Section 78 (4) of a.p.a.). In further proceedings the
administrative body is bound by the legal conclusions which were expressed in the cancelling
sentence (Section 78 (5) of a.p.a.).
Concerning the costs of proceedings, the court decided under Section 60 (1) 1. sentence of
a.p.a. The Claimant was fully successful in the proceedings and therefore it has right for
compensation of the costs. The costs consist of the paid court fee in the amount of CZK
2,000 and legal fees for the Claimant´s representation. The advocate is entitled to be paid
remuneration for 5 acts of legal service of CZK 1,000 each under Sections 7, 9 (3) let. f) of
the Decree No. 177/1996 Coll. (accepting representation, filing the action, filing reply dated
7.7.2005, filing reply dated 24.2.2005 and presence at the court hearing), 5 generalized fees
in the amount of CZK 75 each under Section 13 (3) of the same Decree, compensation for
lost time for 16 of half hours in the amount of CZK 50 each under Section 114 paragraph 1
let. a) and paragraph 3 of the same Decree, travelling costs under Section 13 (1) of the same
Decree for the journey of the advocate of the Claimant from his seat in Zlín to Prague and
back, totally 622 km by car Audi TT, Reg. No.: ZLL 20-21 with average consumption under
the technical card 9.7 liter/100 km under Section 7 (2) let. b) paragraph 4 of the Decree No.
119/1992 Coll., on travel compensations, as amended, and with use of the Decree No.
647/2004 Coll., in the total amount of CZK 4,233.90. Legal fees increase for VAT as the
advocate proved that he is payer of this tax and they amount CZK 14,740. The costs of
proceedings in total then amount CZK 16,740 as stated in the verdict.
I n s t r u c t i o n s : It is possible to file an appeal (in Czech: kasační stížnost”) against this
sentence under conditions set in Section 102 and following of a.p.a.,
in the period of 2 weeks after delivery of the sentence through the
Municipal court in Prague to the Supreme Administrative Court.
Under Section 105 (2) of a.p.a. the appellant must be represented by
advocate in the appellate proceedings; it does not apply if the
appellant, its employee or member who acts on behalf of him or who
represents him, has university legal degree which is required under
special laws for execution of advocacy.
In Prague on 14th October 2005
JUDr. Eva Pechová
chairwoman of the senate
Correctness verified by:
Pekárková