Hungary Amends Copyright Law

The amendments to the Hungarian Copyright Act were published in the Hungarian Official Gazette on May 6, 2021. The amendments aim to transpose into national legislation the EU Directive 2019/790 on copyright and related rights in the Digital Single Market (DSM Directive) and the Directive 2019/789 (SatCab II Directive), which are part of the European Union copyright reform. The most important changes, most of which entered into force on June 1, 2021, are described below.

Liability of Internet Platforms

Under the amendments, the ‘online content-sharing service provider’ is defined as the provider of an information society service whose main or one of the main purposes is to store and communicate to the public a large amount of copyright-protected works or other protected subject matter uploaded by its users, which it organizes and promotes for profit-making purposes.

The limitation of liability relating to intermediary service providers in relation to the possibly infringing content is no longer applicable to online content-sharing service providers in cases when they make works protected by copyright or related rights publicly available or when they perform an act of communication to the public in relation to works which have been uploaded by the users of the platform service.

Online content-sharing service providers will therefore be liable for the unauthorized acts of communication to the public, including making available of copyright-protected works and other subject matter to the public, unless the service providers demonstrate that they:

• have made best efforts to obtain an authorization;
• have made, in accordance with high industry standards of professional diligence, best efforts to ensure the unavailability of specific works and other subject matter for which the right holders have provided relevant and necessary information;
• have acted expeditiously, upon receiving a sufficiently substantiated notice from the right holders, to disable access to the relevant works; and
• have made best efforts to prevent their future uploads.

The liability of content-sharing service providers is dependent on their size, number of users, financial standings and annual turnover, as well as the type and the number of uploaded works.

New Category: Works That Are No Longer Commercially Available

This new category defines a work protected by copyright or related rights which is not likely to be available to the public through usual commercial channels.

The permission from the author or related right holder is not required for the following:

• Reproduction and communication to the public related to a work that is not commercially available; and
• Adaptation and distribution of software, where the use is for the purpose of making available a work which is not commercially available and is a permanent part of the collection of a cultural heritage institution.

This amendment will make it easier for cultural heritage institutions (e.g. museums, libraries and archives) to use works which are no longer commercially available.

Press Publishers Vis-à-Vis Platforms

Another important change is the introduction of a press publisher’s neighboring right. Due to the increase in online news consumption, major online platforms now generate more revenue from online advertising. This legislative change grants press publishers exclusive rights over the use of their publications online, enabling them to license their work, claim revenues from online use of their publications, and enforce their rights in the digital environment.

New Forms of Free Use

A new free use exception for text and data mining has been introduced, as well as a parody exception, meaning that certain copyright-protected content can be freely adapted or ‘parodied’ without the permission of the author of the original work. Further amendments include the modernization of private copying (e.g. the abolition of the exclusive right to copy an entire book by handwriting only).

Changes in Formal Requirements Regarding Software License Agreements

It is no longer obligatory to conclude non-exclusive software license agreements in writing; they will also be deemed valid and enforceable if concluded verbally or as click-through agreements.

Obligation to Provide Annual Reports on the Use of Licensed Works

As of January 1, 2022, the licensees that are party to a license agreement will be obliged to provide the right holder with detailed information, at least once a year, on the use of their work, the manner and extent of use, the revenue from the use of the work for each type of use separately, and the remuneration payable to the author. This obligation is not applicable for works created under an employment contract and for computer programs (software).

Changes to Integrity Protection

Under the former Copyright Act, any distortion, mutilation or other alteration of the author’s work was considered an infringement of moral rights. Under the new regulations, only the acts of distortion, mutilation or other alteration of the author’s work which are prejudicial to the author’s honor or reputation will be considered an infringement of the author’s moral rights.

By transposing the two EU Directives, the amendments clarify the liability of Internet platforms regarding the use of copyright-protected content uploaded on their platforms, and strengthen the position of press publishers, authors and performers. The amendments also provide for fair remuneration for authors and performers for the use of their licensed and assigned rights.

By: Tímea Torzsás

For more information, please contact Tímea Torzsás at our Hungary office.