Peculiarities of visual arts as a subject of copyright and related rights

In a wide range of visual arts, authors create various works that are the subject of copyright and related rights. Since it is, as a whole, a specific category of works seen from a legal and, in particular, copyright perspective, special legal provisions are also applied to them.

In practice, open questions arise regarding the substantive limitations of copyright on this category of works and the relationship between copyright and property rights. Furthermore, the movement of works of visual arts on the market and changes in their owners have a special impact on copyright and related rights. Recently, there is also a need for legal regulations in the context of both digital exploitation and digital creation of works in the field of visual arts, and when looking at possible legal solutions and provisions that need to be applied, several levels of regulations are often intertwined that regulate different aspects of the status of works in digital form (especially with NFTs). In the Republic of Croatia in 2021. the new Law on Copyright and Related Rights (Official Gazette 111/21) was adopted, which introduces changes related to these objects of protection, and it implements various Regulations and Directives of the European Union, including Directive (EU) 2019/790 of the European Parliament and the Council of 17 April 2019 on copyright and related rights on the single digital market and Directive 2001/84/EC of the European Parliament and of the Council of 27 September 2001 on the right of continuation in favor of the author of the original work of art.

In this text, although there are a large number of works that represent the visual arts, the emphasis is primarily on visual arts, photography, applied art, and some audiovisual works.

Content restrictions of copyright

The purpose of limiting copyright lies in the need to protect some other interests, to enable the realization of other rights, or to avoid situations in which the uncompromising protection of all elements of the copyright of their holders would make it impossible for the practical functioning of various activities or the daily use of the work in a way that de facto does not harm interests of the author.

However, even in these cases, the rule for limiting copyrights is that their substantive limitations in each individual case must be prescribed by law and justified by the necessary goals and proportionate to them, and that, in most cases, they must not serve (primarily) to achieve property or commercial profit.

It is important to emphasize that content restrictions in specific cases limit only individual elements that make up copyright as a whole, that is, only individual property or moral rights of the author. Most often, however, it will be about property rights that are otherwise exclusively on the side of the right holder, such as, for example, the exclusive right of reproduction or communication to the public, and rarely about the moral rights of the author, e.g. in certain situations when the omission of the obligation to acknowledge authorship is tolerated, when the method of individual public use of the author’s work makes it impossible to specify the author. In any case, the individual rights of authors are limited and thus the substantive scope of copyrights is narrowed, the obligation to respect all other copyrights remains.

An example of such a restriction on works of visual art are author’s works that are a permanent part of the collection of cultural heritage institutions (museums, libraries, film archives), educational, charitable and other institutions. These institutions have the right to reproduce the work for the preservation of the material and internal needs, but also for other purposes, and to communicate it to the public with the name of the author, but they may not make a profit from it. Exceptions established for the preservation of cultural heritage refer to the right to reproduce works for the purpose of their preservation, since these are works that need to be cared for in the long term and continuously ensure their survival in an undamaged and unchanged form. Preservation and ensuring the survival of objects of protection includes their transformation into digital form.

Duplication of author’s works permanently placed in public places in a two-dimensional form and the creation of posters and catalogs for exhibitions and similar manifestations for the purpose of their promotion, which is an example of a content restriction when the commercial purpose is still tolerated, are also prescribed as content restrictions of copyright, so in the aforementioned in some cases, they can use the work in the prescribed manner without author’s approval and without payment of compensation, but it is always necessary to respect the author’s moral rights.

The relationship between copyright and property rights

There are specific provisions in the law that prescribe how to treat the relationship of ownership and authorship in certain situations.

In the case of works of fine and other visual arts, we face a lot of challenges in the sometimes necessary choice between limiting ownership rights or copyright. The question is how to achieve a fair and sustainable balance between these two fundamentally equal rights.

If the author needs to study the original or a copy of his work in order to be able to make another copy or a specific delivery of the work, the owner or possessor is obliged to enable him to access the work, unless this conflicts with some of his legitimate interests.

As a rule, the owner of the original work has the right to destroy that work, but only if this is preceded by a certain procedure, i.e. a kind of author’s approval. If the author or one of the co-authors has a “special interest” in the work and this can be known to the owner in some way, he must inform the author or co-author about this and offer him a purchase in the amount of the real value of the work. If the author does not want to buy the work, after allowing him to record and photograph it, the owner may destroy it.

It may happen that the author’s work is fixed on someone else’s property without the owner’s permission, as is the case with drawing graffiti or other types of street art on buildings without prior agreement with their owners. In such situations, the owner has the right to destroy the work.

Finally, the author can forbid the exhibition of his work to its owner, but only in the case of alienation itself and if it is not an art gallery or similar entity as the acquirer. There is also an obligation on the part of the author or his heirs to issue a certificate of authorship to the owner.

The right to follow

The work of fine art becomes the property of the acquirer upon sale. The general rule of copyright related to distribution is as follows: with the first distribution of the original, which means its placing on the market and sale, the author loses his previously exclusive right of distribution with respect to that original or copy of the work.

However, the author has the right of reproduction in works of art. It refers to the resale of original works, or copies made by the author himself in a limited number or made under his supervision. When the resale is carried out by galleries, auction houses or any entities that deal with it professionally, the author has the right to a share of the sale price that is realized by each resale. This is a special case when the right of first distribution is not exhausted. Law in Article 35. prescribes the percentages in the price to which the author is necessarily entitled, as well as the amount of the maximum share, but within these frameworks it is always possible to agree otherwise. Despite this, the author cannot even contractually waive this right.

The right of succession is clearly placed in the context of the right of distribution by the new Law, whereby the right of succession is an exception to the operation of the principle of exhaustion of the right of distribution. Although it is stipulated at the European level that upon the first sale of an original or a copy of an author’s work, the right of distribution within the entire European Union is exhausted or terminated in relation to a copy of the author’s work that was placed on the market with the approval of its author or other rights holder, in the case of works of art, the right of tracking applies as an exception.

It is important to emphasize the existence of an increasing number of digital platforms for the auction of paintings and other works, such as “Artsy”, which are auction houses, although they operate in digital form. In these specific situations, it will be important to study the terms of business and specific licenses that apply when transferring ownership, respect for copyright, and, among other elements, the existence of a certificate of authenticity.

Other special provisions according to the new legislation

The new law introduced a provision that stipulates that in cases where the term of protection for a copyrighted work of visual arts has expired, no creation created by duplicating such a work is suitable for copyright protection. This will not apply if it is a creation that is in itself the author’s work of its author. In other words, duplicated copies of works on which copyright protection has expired will not be subject to copyright protection. However, if it is a matter of such duplication resulting in the creation of a new author’s work, then it will be suitable for copyright protection.

Regarding the issue of moral and property rights of the author, certain changes are prescribed that also apply to works of art, photographs and works of applied art and industrial design. Moral rights are now separated into two articles, the right to respect the author’s work and the right to respect the honor or reputation of the author. The right to respect for an author’s work refers to the author’s right to object to the deformation, mutilation and similar defacement of his work, as well as the destruction of the original or the last copy of his work. This means that, for example, the destruction of the original work of art represents in itself a violation of the moral right to respect the work. No additional assumption has to be fulfilled. Also, it is now clear from the provision that only intensive interventions in the act such as deforming, mutilation or similar disfigurement are considered a violation of this moral right. A contrario , minor violations will not be considered a violation of a moral right, but only possibly a violation of the property right of processing. The right to respect for honor and reputation, set out in a separate article, implies that the violation occurs when the author’s work is used in a way that insults the author’s honor and reputation.

Digitization and visual arts

The new law, i.e. originally Directive 790/2019, introduced new exceptions, justified by the need to digitize works, which are important for works of visual arts, and refer to cultural heritage institutions, such as museums, archives, public libraries and other cultural institutions.

Directive 790/19 and the new ZAPSP provide for exceptions and limitations

transfer of rights to works that are not available on the market in favor of cultural heritage institutions. They were introduced with the purpose of enabling such works to be made available to the public on the Internet for non-commercial purposes in order to ensure their availability to users from all countries.

chain. Since these are works that do not move through regular channels of commerce or are available to the public, the exception allows them to remain visible in circumstances where, without such a solution, the possibility of sharing them would be practical

but disabled. An example in the EU is represented by “Europeanna”, which can also be seen as a gallery space on the Internet where the works of various artists from all EU member states are uploaded.

Digitization of the collections of cultural heritage organizations from the EU, as well as making them available to the public, takes place to a large extent on that website, where the works of cultural heritage are combined into various publicly accessible collections. In its original version, it was established by the European Commission in 2008. years. Many collections were formed as actual exhibitions, with their own curators as well as listing the authors with their works and the member state that made the work available. The works can be downloaded for free and you can create your own collections, which requires registration on the portal, but downloading reproductions of the works in digital form is free.

The most interesting aspect of the intersection of the digital world and visual arts in recent times is represented by the so-called Non Fungible Tokens. These are works of authorship that were created and exist exclusively in digital form, and ownership and exploitation rights are transferred via blockchain technology. Most often, this is about works of visual or audiovisual arts.

NFTs are based on cryptocurrencies, while the largest percentage of works are created and marketed within the Etherium blockchain platform. In summary, NFTs consist of three basic components. They are based on an existing cryptocurrency on which the authors “upgrade” their work in digital form, which together form a token that exists on the blockchain on which the transaction is carried out. The third component of NFT is a smart contract that automates certain actions and cause-and-effect relationships and consists of computer code. The contracts and licenses themselves are concluded separately, and they should regulate exactly which rights to exploit the work are established. What is important to emphasize and which is in a way analogous to the right of succession, but in this case is applied regardless of the characteristics of the entity that resells the work, is that the author automatically receives a certain compensation from each transaction that will be made regarding his work.

To determine other copyright and other issues, it is currently most advisable to arrange them in detail by contract, that is, to make sure that a suitable and favorable existing licensing agreement is applied. In practice, the method of dealing with potential disputes in this area and the appropriate application of existing regulations have yet to be determined. At the EU level, the proposal for a regulation of the European Parliament and the Council on cryptoasset markets and the amendment of Directive (EU) 2019/1937 is currently in the process, which will at least from one aspect reach this issue, and given the growing popularity of such works and their distribution, it can probably be expected and a proposal for their regulation from the copyright aspect in the near future.