8 ms·

EU Court Rules E-Books Are Services, Not Goods

82 points by mstolpm 12y ago

OldSchoolJohnny 12y ago
Paywalled
bmaeser 12y ago
paywall
bndr 12y ago
Go here: https://www.google.com/#safe=off&q=eu-court-rules-e-books-are-services-not-goods-1425552050 https://www.google.com/#safe=off&q=eu-court-rules-e-books-ar... Click on the first link that leads to wsj.
- Udo_Schmitz 12y ago
  This just brings me to Googles homepage with some stuff added after https://www.google.de/ https://www.google.de/ Is it because I'm in Germany and they have the .com --> .de redirect?
boo_radley 12y ago
Is it, strictly speaking, possible to pirate a service?
- Terr_ 12y ago
  Strictly speaking, "piracy" means something involving international boundaries, planes/ships, and violence or coercion... But seriously (and colloquially) "piracy" is still not specific enough if you're asking a legal question. Do you mean only plain copyright infringement? Unlicensed use of spectrum with "pirate radio"? Secretly re-selling portions of you phone's data plan via tethering? Bypassing electricity-meters and wiring your house up to the grid directly? ...Abusing a promotional offer that says "one massage per person"?
- pdabbadabba 12y ago
  The product/service distinction is orthogonal to the relevant category in (U.S.) copyright law: the work. Only "works" can be copyrighted, but a work can be provided as part of a service, sold as a product, or one of any number of other possibilities. Nice try though. :)
  - rdudek 12y ago
    But it's still a product! I can sum this up that all services are products but not all products are services. So if I were to publish a book which would classify as "work" which I can copyright. At this point, I have a product that doesn't exist yet other than a word document ready to be sent off to publishers. The publisher will take my "work" and print it out into a physical book which we can clasify as a product. They can also format it into a electronic version of the book which is also a product. Now, how the publisher can send it off to a service provider like Amazon Kindle to distribute it (that's a service)
    - masklinn 12y ago
      I assume pdabbadabba meant "sold as a good".
  - TeMPOraL 12y ago
    > Nice try though. :) Yesterday's XKCD immediately comes to mind. http://xkcd.com/1494/ http://xkcd.com/1494/
- icebraining 12y ago
  http://en.wikipedia.org/wiki/Cable_television_piracy http://en.wikipedia.org/wiki/Cable_television_piracy
- blacksmith_tb 12y ago
  Theft of services is a common enough occurrence (e.g. someone sneaking a bag of garbage into the dumpster of a business instead of paying for trash pickup).
- wvenable 12y ago
  Yes, happens all the time. In Canada there was a whole industry around freely acquiring satellite TV services from the US.
JohnTHaller 12y ago
The basic ruling is that e-books are 'electronic services' and not goods, as a paper book would be. Therefor, France and Luxembourg must apply their standard Value-Added Tax (VAT) of 20% and 17% respectively instead of the lower rate used for paper-backed books of 5.5% and 3% respectively. EU law states that reduced rates for specific categories can only apply to goods, not services. The countries as well as companies like Amazon will push to allow the lower VAT to be applied to ebooks.
- Cthulhu_ 12y ago
  As an extra tidbit of information: Luxembourg was already violating EU rules for having a VAT percentage of less than 5%.
  - legulere 12y ago
    Ireland even has a 0% rate on books according to wikipedia. Lower than 5% tax rates seem to be pretty common: http://en.wikipedia.org/wiki/European_Union_value_added_tax#Zero_rate_derogation http://en.wikipedia.org/wiki/European_Union_value_added_tax#...
    - gsnedders 12y ago
      The UK and Ireland have 0% VAT rates which are allowed as they were essentially grandfathered in. They aren't allowed to be expanded, however.
      - andrewpi 12y ago
        Why does the EU restrict members from lowering their VAT rates?
        gsnedders 12y ago
        To try and avoid overly large price differentials between member states.
higherpurpose 12y ago
Seeing how these days you're effectively "renting" any cloud-based DRM-enabled digital content, I think it makes more sense for them to be called services for which you get a "license to use" indefinite (i.e. limited, for as long as the deal vendor/publisher is in place) period of time.
- glitchinc 12y ago
  IIRC, even some DRM-free digital content (e.g. iTunes downloads) are rented per the EULA. But yes... I agree that anything that is rented is more appropriately be defined as a service rather than a product.
Fdndjxjxr 12y ago
Richard Stallman warned us about this kind of thing: he warned us and we laughed.
- jeremysmyth 12y ago
  What did he warn us, and who laughed?
  - digi_owl 12y ago
    https://www.gnu.org/philosophy/right-to-read.html https://www.gnu.org/philosophy/right-to-read.html
    - rikkus 12y ago
      This is somewhat relevant, yes, but I don't think anyone here is/was laughing. We can see the oncoming juggernaut, but there's little we can do about it.
      - digi_owl 12y ago
        I think many more were laughing back when it was originally published. Note that it dates back to 1997.
        jeremysmyth 12y ago
        Yes, but the cautionary tale is about content licencing and access control, and tangentially about copyright. It's a stretch to suggest it's a warning about the content of the article, which is about applying VAT differently to ebooks and physical books and nothing at all to do with access control. It's not even a warning about ebooks, which are implied but not mentioned in the cautionary tale.
      - zanny 12y ago
        You can easily do something about it. Do not support the business model of holding information hostage, and support those that do not (ie, buy DRM free books, and even moreso completely free as in freedom books, to support the business model)
deleted 12y ago
[deleted]
deleted 12y ago
[deleted]
outworlder 12y ago
Makes sense for Amazon's store, where your books live in the cloud and you download some of them locally if you want. Doesn't make sense if you are provided an .epub file to download.
- restalis 12y ago
  If you as publisher are claiming the ownership of some content (by enforcing various restrictions upon its users, through DRM or just by imposing an agreement on which you can hold later) even after it was downloaded, then you are very close to service definition. It's like the way the provided service reach the client may differ, but the basic value for which the interested client actually pays stay the same.
pilif 12y ago
While short term, this sucks, I also think that in the way that eBooks work these days, this ruling is actually fair and it might well fix the situation for us consumers in the mid- to longer term. For all intents and purposes, eBooks are services. Between DRM, vendor lock-in and other consumer hostile "features" of ebooks, seeing them as services and consequently taxing them as services totally makes sense. As an ebook publisher, you can't have it both ways. You can't ask for the lower VAT of the easily lendable and copyable books and at the same time rent out a product that has none of these "drawbacks". What will come out of this long-term is much more user friendly ebooks.
- wahsd 12y ago
  I don't think you appreciate the impact. Services are something you lease and use for a specific period and you never own. This seems at least to be an affirmation that ebooks cannot ever be owned by anyone but the publisher and there will now need to be legal mechanisms for revocation of ebooks from your device and reporting and even penalizing and prosecution of anyone who prevents revocation or even simply does not delete a book that is a service and therefore possibly being used illicitly.
  - dragonwriter 12y ago
    > I don't think you appreciate the impact. I don't think you appreciate the degree to which definitions of categories in law (and thus rulings on the boundaries of such classifications) are specific to narrow domains or even particular enactments. This is about categories under European Value-Added Tax (VAT) rules, not the general philosophical category you are describing.
  - detaro 12y ago
    I'm not entirely clear if this decision was about all e-books or only those that are provided as services (the article cites Amazon, which I would classify as a service, and it is not entirely clear if a download of an unrestricted file is covered or not)
    - 12y ago
Oletros 12y ago
The press release for the ruling http://curia.europa.eu/jcms/upload/docs/application/pdf/2015-03/cp150030en.pdf http://curia.europa.eu/jcms/upload/docs/application/pdf/2015...
DiabloD3 12y ago
Can someone paste the text of this? wsj paywall is making wsj useless again.
- Infinitesimus 12y ago
  Do a bing/google search for " eu-court-rules-e-books-are-services-not-goods-1425552050 " and link from there
- pmontra 12y ago
  Non paywalled news from another source at http://www.reuters.com/article/2015/03/05/us-europe-ebooks-tax-idUSKBN0M11A120150305 http://www.reuters.com/article/2015/03/05/us-europe-ebooks-t...
forloop 12y ago
Paywall.
avelis 12y ago
I always thought of e-books as an intangible good. What confuses me on the ruling is what part of the e-book's labor becomes a service to tax? http://en.wikipedia.org/wiki/Intangible_good http://en.wikipedia.org/wiki/Intangible_good
drzaiusapelord 12y ago
Between this, the constant nag screen on every European site I go to about "evil cookies," and their relentless attacks on Google and MS, which always results in a major payout to EU countries... what the hell are they thinking? We've lost more property rights again. I think the left leaning aspects of the EU are great for welfare benefits and social services, but the way its applied to business practices always seems more than a bit off. I fear this is the slipperly slope here where I own nothing and everything is a "service" somehow. The sad part is this was done, ostensibly, to avoid a VAT discount that paper books enjoy. EU corruption knows no bounds.
- antientropic 12y ago
  Why is this "corruption"? Are you alleging that EU officials are running off with the VAT money for private gain?
  - drzaiusapelord 12y ago
    My suggestion is that their ability to tax EU buyers is limited via paper book exception. Recategorizing them as digital products means more taxation without any ugly legislation issues that would come up in a traditional attempt to raise taxes.
- restalis 12y ago
  "I own nothing and everything is a «service» somehow" You got it right. You happen to be "serviced" with a knowledge that is owned by someone. For a while already you had to agree on all kinds of EULAs all the time, in which it was required for you to redefine (read "to limit") what you might thought is owned by you. Now you have it in more clear terms. The non-EU space will catch-up soon, don't worry.
pm24601 12y ago
Completely the correct decision based on the restriction on ebooks. Does anyone have the complete reasoning behind the service designation? It would be cool if ebooks sold without DRM would get the real book tax treatment.
anotherevan 12y ago
That wouldn't bother me if the buttons on ebook selling sites didn't say "Buy Now" but said "Lease Now" or "Rent Now". But they don't. https://twitter.com/evmcl/status/261661956681908225/photo/1 https://twitter.com/evmcl/status/261661956681908225/photo/1 http://www.bekkelund.net/2012/10/22/outlawed-by-amazon-drm/ http://www.bekkelund.net/2012/10/22/outlawed-by-amazon-drm/ http://the-digital-reader.com/2012/10/23/kobo-says-youre-no-longer-allowed-to-share-your-account-not-with-a-spouse-your-kids-anyone/#.VFFysX8sVcM http://the-digital-reader.com/2012/10/23/kobo-says-youre-no-... https://twitter.com/librarythingtim/status/142628597289582593 https://twitter.com/librarythingtim/status/14262859728958259...

82 points by mstolpm 12y ago

OldSchoolJohnny 12y ago

Paywalled

bmaeser 12y ago

paywall

bndr 12y ago

Go here: https://www.google.com/#safe=off&q=eu-court-rules-e-books-are-services-not-goods-1425552050 https://www.google.com/#safe=off&q=eu-court-rules-e-books-ar... Click on the first link that leads to wsj.

Udo_Schmitz 12y ago
This just brings me to Googles homepage with some stuff added after https://www.google.de/ https://www.google.de/ Is it because I'm in Germany and they have the .com --> .de redirect?

boo_radley 12y ago

Is it, strictly speaking, possible to pirate a service?

Terr_ 12y ago
Strictly speaking, "piracy" means something involving international boundaries, planes/ships, and violence or coercion... But seriously (and colloquially) "piracy" is still not specific enough if you're asking a legal question. Do you mean only plain copyright infringement? Unlicensed use of spectrum with "pirate radio"? Secretly re-selling portions of you phone's data plan via tethering? Bypassing electricity-meters and wiring your house up to the grid directly? ...Abusing a promotional offer that says "one massage per person"?
pdabbadabba 12y ago
The product/service distinction is orthogonal to the relevant category in (U.S.) copyright law: the work. Only "works" can be copyrighted, but a work can be provided as part of a service, sold as a product, or one of any number of other possibilities. Nice try though. :)
- rdudek 12y ago
  But it's still a product! I can sum this up that all services are products but not all products are services. So if I were to publish a book which would classify as "work" which I can copyright. At this point, I have a product that doesn't exist yet other than a word document ready to be sent off to publishers. The publisher will take my "work" and print it out into a physical book which we can clasify as a product. They can also format it into a electronic version of the book which is also a product. Now, how the publisher can send it off to a service provider like Amazon Kindle to distribute it (that's a service)
  - masklinn 12y ago
    I assume pdabbadabba meant "sold as a good".
- TeMPOraL 12y ago
  > Nice try though. :) Yesterday's XKCD immediately comes to mind. http://xkcd.com/1494/ http://xkcd.com/1494/
icebraining 12y ago
http://en.wikipedia.org/wiki/Cable_television_piracy http://en.wikipedia.org/wiki/Cable_television_piracy
blacksmith_tb 12y ago
Theft of services is a common enough occurrence (e.g. someone sneaking a bag of garbage into the dumpster of a business instead of paying for trash pickup).
wvenable 12y ago
Yes, happens all the time. In Canada there was a whole industry around freely acquiring satellite TV services from the US.

JohnTHaller 12y ago

The basic ruling is that e-books are 'electronic services' and not goods, as a paper book would be. Therefor, France and Luxembourg must apply their standard Value-Added Tax (VAT) of 20% and 17% respectively instead of the lower rate used for paper-backed books of 5.5% and 3% respectively. EU law states that reduced rates for specific categories can only apply to goods, not services. The countries as well as companies like Amazon will push to allow the lower VAT to be applied to ebooks.

Cthulhu_ 12y ago
As an extra tidbit of information: Luxembourg was already violating EU rules for having a VAT percentage of less than 5%.
- legulere 12y ago
  Ireland even has a 0% rate on books according to wikipedia. Lower than 5% tax rates seem to be pretty common: http://en.wikipedia.org/wiki/European_Union_value_added_tax#Zero_rate_derogation http://en.wikipedia.org/wiki/European_Union_value_added_tax#...
  - gsnedders 12y ago
    The UK and Ireland have 0% VAT rates which are allowed as they were essentially grandfathered in. They aren't allowed to be expanded, however.
    - andrewpi 12y ago
      Why does the EU restrict members from lowering their VAT rates?
      - gsnedders 12y ago
        To try and avoid overly large price differentials between member states.

higherpurpose 12y ago

Seeing how these days you're effectively "renting" any cloud-based DRM-enabled digital content, I think it makes more sense for them to be called services for which you get a "license to use" indefinite (i.e. limited, for as long as the deal vendor/publisher is in place) period of time.

glitchinc 12y ago
IIRC, even some DRM-free digital content (e.g. iTunes downloads) are rented per the EULA. But yes... I agree that anything that is rented is more appropriately be defined as a service rather than a product.

Fdndjxjxr 12y ago

Richard Stallman warned us about this kind of thing: he warned us and we laughed.

jeremysmyth 12y ago
What did he warn us, and who laughed?
- digi_owl 12y ago
  https://www.gnu.org/philosophy/right-to-read.html https://www.gnu.org/philosophy/right-to-read.html
  - rikkus 12y ago
    This is somewhat relevant, yes, but I don't think anyone here is/was laughing. We can see the oncoming juggernaut, but there's little we can do about it.
    - digi_owl 12y ago
      I think many more were laughing back when it was originally published. Note that it dates back to 1997.
      - jeremysmyth 12y ago
        Yes, but the cautionary tale is about content licencing and access control, and tangentially about copyright. It's a stretch to suggest it's a warning about the content of the article, which is about applying VAT differently to ebooks and physical books and nothing at all to do with access control. It's not even a warning about ebooks, which are implied but not mentioned in the cautionary tale.
    - zanny 12y ago
      You can easily do something about it. Do not support the business model of holding information hostage, and support those that do not (ie, buy DRM free books, and even moreso completely free as in freedom books, to support the business model)

deleted 12y ago

[deleted]

deleted 12y ago

[deleted]

outworlder 12y ago

Makes sense for Amazon's store, where your books live in the cloud and you download some of them locally if you want. Doesn't make sense if you are provided an .epub file to download.

restalis 12y ago
If you as publisher are claiming the ownership of some content (by enforcing various restrictions upon its users, through DRM or just by imposing an agreement on which you can hold later) even after it was downloaded, then you are very close to service definition. It's like the way the provided service reach the client may differ, but the basic value for which the interested client actually pays stay the same.

pilif 12y ago

While short term, this sucks, I also think that in the way that eBooks work these days, this ruling is actually fair and it might well fix the situation for us consumers in the mid- to longer term. For all intents and purposes, eBooks are services. Between DRM, vendor lock-in and other consumer hostile "features" of ebooks, seeing them as services and consequently taxing them as services totally makes sense. As an ebook publisher, you can't have it both ways. You can't ask for the lower VAT of the easily lendable and copyable books and at the same time rent out a product that has none of these "drawbacks". What will come out of this long-term is much more user friendly ebooks.

wahsd 12y ago
I don't think you appreciate the impact. Services are something you lease and use for a specific period and you never own. This seems at least to be an affirmation that ebooks cannot ever be owned by anyone but the publisher and there will now need to be legal mechanisms for revocation of ebooks from your device and reporting and even penalizing and prosecution of anyone who prevents revocation or even simply does not delete a book that is a service and therefore possibly being used illicitly.
- dragonwriter 12y ago
  > I don't think you appreciate the impact. I don't think you appreciate the degree to which definitions of categories in law (and thus rulings on the boundaries of such classifications) are specific to narrow domains or even particular enactments. This is about categories under European Value-Added Tax (VAT) rules, not the general philosophical category you are describing.
- detaro 12y ago
  I'm not entirely clear if this decision was about all e-books or only those that are provided as services (the article cites Amazon, which I would classify as a service, and it is not entirely clear if a download of an unrestricted file is covered or not)
  - 12y ago

Oletros 12y ago

The press release for the ruling http://curia.europa.eu/jcms/upload/docs/application/pdf/2015-03/cp150030en.pdf http://curia.europa.eu/jcms/upload/docs/application/pdf/2015...

DiabloD3 12y ago

Can someone paste the text of this? wsj paywall is making wsj useless again.

Infinitesimus 12y ago
Do a bing/google search for " eu-court-rules-e-books-are-services-not-goods-1425552050 " and link from there
pmontra 12y ago
Non paywalled news from another source at http://www.reuters.com/article/2015/03/05/us-europe-ebooks-tax-idUSKBN0M11A120150305 http://www.reuters.com/article/2015/03/05/us-europe-ebooks-t...

forloop 12y ago

Paywall.

avelis 12y ago

I always thought of e-books as an intangible good. What confuses me on the ruling is what part of the e-book's labor becomes a service to tax? http://en.wikipedia.org/wiki/Intangible_good http://en.wikipedia.org/wiki/Intangible_good

drzaiusapelord 12y ago

Between this, the constant nag screen on every European site I go to about "evil cookies," and their relentless attacks on Google and MS, which always results in a major payout to EU countries... what the hell are they thinking? We've lost more property rights again. I think the left leaning aspects of the EU are great for welfare benefits and social services, but the way its applied to business practices always seems more than a bit off. I fear this is the slipperly slope here where I own nothing and everything is a "service" somehow. The sad part is this was done, ostensibly, to avoid a VAT discount that paper books enjoy. EU corruption knows no bounds.

antientropic 12y ago
Why is this "corruption"? Are you alleging that EU officials are running off with the VAT money for private gain?
- drzaiusapelord 12y ago
  My suggestion is that their ability to tax EU buyers is limited via paper book exception. Recategorizing them as digital products means more taxation without any ugly legislation issues that would come up in a traditional attempt to raise taxes.
restalis 12y ago
"I own nothing and everything is a «service» somehow" You got it right. You happen to be "serviced" with a knowledge that is owned by someone. For a while already you had to agree on all kinds of EULAs all the time, in which it was required for you to redefine (read "to limit") what you might thought is owned by you. Now you have it in more clear terms. The non-EU space will catch-up soon, don't worry.

pm24601 12y ago

Completely the correct decision based on the restriction on ebooks. Does anyone have the complete reasoning behind the service designation? It would be cool if ebooks sold without DRM would get the real book tax treatment.

anotherevan 12y ago

That wouldn't bother me if the buttons on ebook selling sites didn't say "Buy Now" but said "Lease Now" or "Rent Now". But they don't. https://twitter.com/evmcl/status/261661956681908225/photo/1 https://twitter.com/evmcl/status/261661956681908225/photo/1 http://www.bekkelund.net/2012/10/22/outlawed-by-amazon-drm/ http://www.bekkelund.net/2012/10/22/outlawed-by-amazon-drm/ http://the-digital-reader.com/2012/10/23/kobo-says-youre-no-longer-allowed-to-share-your-account-not-with-a-spouse-your-kids-anyone/#.VFFysX8sVcM http://the-digital-reader.com/2012/10/23/kobo-says-youre-no-... https://twitter.com/librarythingtim/status/142628597289582593 https://twitter.com/librarythingtim/status/14262859728958259...