A concise overview of (Italian) copyright law: contractual processes and copyright law reform. In an interview with TAKE magazine, copyright law expert Diana Rulli provides a comprehensive guide to everything you need to know.
What is the difference between an Option Agreement (Optionsvertrag) and a Rights Purchase Agreement (Verfilmungsvertrag)?
An option agreement is a proposal submitted by one party to the other which is valid for a specified duration. It is a type of pre-contract with significant strategic relevance from an entrepreneurial perspective, as it enables a producer to temporarily secure the rights to a work without making a substantial financial investment while checking the feasibility of a project. If the film shows promise, the option will be exercised, and the rights will be acquired permanently by signing a rights purchase agreement to transfer the copyright (contratto di cessione dei diritti): through this agreement, the party acquires the rights to an intellectual work for the duration of the legal copyright period (70 years).
Do both contract types require compensation?
Yes. Otherwise, this could result in the contracts being void and/or easily contested. For option agreements, remuneration is typically set at 10 per cent of the agreed sum of the permanent purchase and transfer of the rights. However, the agreed remuneration also strongly depends on the negotiation strength of the contractual parties, the specific market situation, and the reputation of the author and producer.
What information is absolutely essential to include in an option agreement or rights purchase agreement?
An option agreement must always specify the expiration date of the temporary transfer of rights granted by the option, the agreed remuneration for the permanent transfer of rights, and information on how the option may be exercised. In general, the option agreement must establish that the parties both agree on the subject matter and the purpose, and sometimes also on the form of contract. The final rights purchase agreement also includes other clauses protecting the author, such as additional payments that are deemed fair and appropriate in accordance with copyright legislation. The absence of these clauses will void the contract.
Is there a maximum term for option and rights purchase agreements?
The terms for option agreements depend on the duration the author is willing to grant for the option. Especially in the case of independent productions, making a film may well take years. As a result, options normally expire after 48 or 54 months. While it is possible to agree on different terms, rights purchase agreements generally stipulate the period of validity in accordance with current legislation.
Can rights purchase agreements sometimes include extra payments if the film is granted subsidies?
Yes. That would be an atypical contract concluded on an ad-hoc basis. For example, it is common practice for production companies to make a bonus payment to the directors if the film qualifies for subsidies or receives an award.
Is it possible to purchase only part of the rights to a work of literature?
A work of literature is associated with a wide range of specific rights which can be regarded separate from each other. As a result, it is possible to acquire only the rights for a remake, for a prequel, or for a spin-off, for example. These rights for economic exploitation exist independently of one another.
What has changed since the copyright law reform?
Three key changes include, for example, the right to a fair compensation for the online usage of press releases; the right to fair and proportionate remuneration for filmmakers—including script developers, screenplay authors, directors, dialogue authors, dubbing directors, translators, performers, leading and supporting actors, or voice artists; and the obligation to seek prior approval for content uploaded to the internet by users of sharing platforms as well as the obligation to issue a notification when a transferred or licensed right is being exploited.
When drafting the contract, does it play a role whether or not the work has previously been registered with the Italian Society of Authors and Publishers (SIAE) or any other copyright collecting agency?
Whether or not a work has been registered with SIAE (or a similar institution) does not play a role when it comes to copyright. As the registration may be used as supporting evidence, we would recommend getting the work registered, but registration alone is not sufficient to establish the existence of copyright.
Which clauses could be useful to make sure you are protected when it comes to the new technologies?
Technological advances have opened up completely new opportunities that are not yet fully covered by copyright law. At the moment, we make do with existing legislation and adapt our agreements to new technologies as required.
Which contracts can be used to specify the directors for the work?
The Italian Civil Code and the Italian Copyright Law have established contracts governing the direction of a film and the transfer of all associated rights. These contracts are work contracts governing self-employed work (i. e., legislation governing self-employed work contracts applies here, too) and must include compensation for the services rendered (60 per cent of remuneration) as well as for the rights of exploitation arising from them (40 per cent).