In 2003 the copyright fee was introduced in Ukraine as a compensation mechanism for right-holders' losses caused by piracy. This innovation was driven by Ukraine`s international obligations towards intellectual property protection.
The system operated with disruptions until 2014, when the copyright fee collection was effectively blocked by the business community, which exploited legal loopholes in the legislation and was unwilling to negotiate with Collective Management Organizations, the nominated representatives of the right holders. The conflict largely focused on the fee rates and list of devices charged. The stakes are relatively high – the annual fee collection for laptops and PCs alone could amount to USD 3 million nationwide.
At the end of 2020, the ruling party attempted to relaunch the copyright fee collection system, prompted by concern among its international partners over the weak IP protection within the country. Despite the fresh approach, however, critics say the root causes of the conflict have not been addressed.
The new draft proposes the following:
- to empower the Government to define the fee rates within the limits established by the Law (no higher than 0.12%);
- to define an exhaustive list of devices from which the fee for private copying shall be collected – only from data storage devices: SSDs, HDDs, flash drives and memory cards.
To learn more about these developments and possible future scenarios and what they could mean for businesses click here for the full memo in English.