Peers join UK creator groups' call for ministers to rule out copyright exception for AI firms
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LEAD STORY
🏛️ AI POLICY & REGULATION
THE UK’S UPPER HOUSE has called on the Keir Starmer administration to follow Australia’s lead in ruling out a new copyright exception that would allow hi-techs to train their AI models on rightsholders’ works without consent or compensation. The House of Lords report further recommends forcing AI developers to reveal which works have been used for model training — the issue that prompted last year’s repeated clashes between peers and ministers, and prolonged parliamentary deadlock.
More in a moment on the Lords’ sympathetic report, plus we hear from creator groups who are deeply concerned that the UK government is considering a new concession for AI companies that would allow them to claim AI model training was performed under the guise of research. Plus, the Financial Times is today reporting that the government has chosen to delay making any decisions on AI and copyright, and that its long-awaited response to last year’s consultation — due on or before March 18 — will merely state it needs to gather more evidence.
THE LORDS’ REPORT
First, today’s 83-page report from the Lords’ Communications and Digital Committee which makes clear the UK “faces a choice between two futures”. In the first, it says, the UK could become “a world-leading home for responsible, licensing-based AI development, where commercial model developers using UK content obtain permission, pay fair remuneration to rightsholders and can deploy their models without questions of legal liability”. In this scenario both the UK’s creative industries and home-grown AI sector could “thrive, building on our national strengths and unique selling point of innovating in creative technology”.
However, a second scenario would see the UK continue to “drift towards tacit acceptance of large-scale, unlicensed use of creative content and long-term dependence on opaque models trained overseas, with most benefits accruing to a small number of US-based firms while harms to UK creators grow”.
“Only the first path is compatible with the UK’s long-term interests,” says the report which stresses there is only “limited evidence” to show that weakening UK copyright law by introducing a broad exception for commercial text and data mining (TDM) “would significantly expand our AI sector”.
“In contrast, a broad commercial TDM exception presents predictable harms to rightsholders by removing incentives to license protected works for AI training.”
The report says it would be a “poor bet to sacrifice the UK’s outstanding creative capacity for speculative AI gains”. “A new regime must now be created to safeguard creators’ livelihoods, while harnessing the potential of AI for creativity and economic growth.” The key planks of that regime would see ministers:
Ruling out a new commercial TDM exception with an opt-out for creators — the government’s preferred option in last year’s consultation which was backed by just 3% of the 11,512 responses.
Strengthening creators’ rights by introducing protections against unauthorised digital replicas and ‘in the style of’ AI outputs.
Making transparency on works used to train AI models a statutory obligation.
Creating conditions for a “fair and inclusive UK licensing market”.
Prioritising the development and adoption of sovereign AI models, reducing the UK’s “overreliance on opaquely trained US-based models”.
Committee chair Baroness Keeley, the former Labour MP Barbara Keeley whose early career was spent as a systems engineer with IBM, said the UK’s creative industries faced “a clear and present danger from uncredited and unremunerated use of copyrighted material to train AI models”. “Photographers, musicians, authors and publishers are seeing their work fed into AI models which then produce imitations that take employment and earning opportunities from the original creators.” While AI might contribute to future economic growth, the UK’s creative industries already generated £124 billion ($166 billion, €143 billion) of economic value.
“Watering down the protections in our existing copyright regime to lure the biggest US tech companies is a race to the bottom that does not serve UK interests. We should not sacrifice our creative industries for AI jam tomorrow.”
She added: “The future for AI in the UK should be based on transparent and responsible use of training data. We are calling on the government to embrace the opportunities this presents, and to demonstrate its commitment to the UK’s gold-standard copyright regime and our outstanding creative industries in its forthcoming economic assessment and update on AI and copyright.”
NEW EXCEPTION FEARS
Section 29A of the UK’s Copyright, Designs and Patents Act currently provides a TDM exception for non-commercial research purposes. Earlier this week peers quizzed the government on rumours that ministers were considering allowing TDM for commercial research purposes amid lobbying from hi-techs. Asked if she could rule out a commercial research exception that would “fatally undermine licensing markets” Baroness Twycross, a minister in the culture department, told peers it would be “a bit pre-emptive” to do so. That prompted Lord Clement-Jones, Liberal Democrat spokesperson on science, innovation and technology in the Lords and chair of the Authors’ Licensing and Collecting Society (ALCS), to ask if she could “rule in the importance of making sure that AI developers must license UK content for the training and grounding of their models?” Baroness Twycross said the government’s priority was to “ensure that the UK is ready for AI-related risks while supporting responsible innovation and long-term growth”.
Speaking to Charting, Lord Clement-Jones — a renowned legal expert on AI and copyright matters — said a commercial research exception would be “a disaster for the creative industries” and worse even “than a TDM with opt-out”, adding:
“It would in practice remove the right of creators to refuse use of their work in any and all AI training and give AI developers the ability to invariably claim that the training of their models is commercial research. This is an option we should resist even more robustly than the TDM.”
On X ethical training warrior Ed Newton-Rex said Baroness Twycross’ reply made it “abundantly clear” that the government was planning to introduce a copyright exception for commercial research. Speaking to Charting Newton-Rex said a commercial research exception was “totally unworkable”.
“There are only two outcomes: either AI companies would waste millions training models they could never release, because a single rightsholder refusing to license their work after training would make a model unreleasable; or the government would have to introduce compulsory licensing for AI training, which would be outrageously unfair and would rightfully cause uproar among creatives. This is a total non-starter, and the government should rule it out before wasting any more time on the idea.”
Anna Ganley, CEO at the Society of Authors, told Charting a commercial research exception would “legitimise the theft that has taken place to date and would do nothing to protect human creativity”, adding:
“From a technical standpoint, how would this be defined to avoid loopholes, how would it be policed, and how would it ensure that commercial uses are eventually paid for? To me, this looks like a further loosening of copyright rules in favour of Big Tech and at the expense of individual creators.”
Isabelle Doran, CEO at the Association of Photographers, told Charting the option was “even worse than the unpopular TDM with opt-out proposal” since it provided “a legal backdoor route for AI developers to continue scraping UK creators’ works without permission and avoid paying them anything, all in the name of ‘commercial research’”. Sophie Jones, strategy chief at the BPI — voice of the UK’s recorded music labels — told Charting the commercial research exception was “deeply troubling as it would give AI developers even more power to steal music for commercial purposes than the earlier mooted — and now discredited — TDM with opt-out”. “It would either signal that the government’s repeated pledges to protect the UK’s world leading creative industries were empty promises, or that ministers fail to understand the consequences of a step such as this.” Jones added:
“In the months since the government began its consultation on AI and copyright, numerous deals between music companies and AI developers have been struck and it has become abundantly clear that AI licensing can develop in a way which benefits the UK’s creative and AI sectors. We recommend that the government focuses on enabling this opportunity by implementing sensible record-keeping measures, rather than on an ill-conceived, damaging and unnecessary weakening of copyright that would hamper growth just as the licensing market is developing.”
Dan Conway, CEO at the Publishers Association, told Charting an exception for commercial research would be “more expansive — and more damaging — than the one previously proposed by the government”. “If AI developers could claim that using copyright works in training sets is fundamentally an R&D/science exercise being done in ‘AI labs’, then all UK content is forfeit.” He added:
“The UK is a world-leader in scientific content and has the opportunity to turbocharge this competitive advantage in the age of AI. The introduction of a commercial research exception would be an extraordinary act of self-sabotage by the UK government. We call on [tech secretary Liz Kendall] to back the UK as a content superpower by ruling out a commercial research exception and committing to legislate to introduce transparency requirements on AI developers on March 18.”
Owen Meredith, CEO at the News Media Association, said the Lords’ report was right to conclude that the government “must decisively rule out any copyright exception, including for so-called ‘commercial research’”. He added: “Prolonged government-generated uncertainty has been exploited by AI firms and has chilled the licensing market for UK content. There is one swift, simple step the government can take to unlock growth in UK intellectual property: publicly rule out changes to copyright law and allow the market to scale at pace.” Eilidh Wilson, public affairs chief at the PPA, the industry body for magazine media and business information, urged the government to “adopt the Lords’ recommendations to rule out a broad commercial text and data mining exception”. “Clarifying this position would create the right incentives for AI developers to engage in good-faith licensing rather than using copyrighted material without permission,” she added.
A government spokesperson told Charting: “The government wants a copyright regime that values and protects human creativity, can be trusted, and unlocks innovation. We welcome the committee’s contributions, and we will continue to engage closely with parliament going forwards.”
MARCH 18 RESPONSE
Meanwhile the Financial Times reported Kendal and culture secretary Lisa Nandy were set to delay making difficult decisions on UK copyright. “Copyright is going to be kicked down the road,” a person who had knowledge of the government’s response on March 18 was quoted as saying. Another person briefed on the government’s plans told the FT ministers wanted to take more time gathering additional evidence and consulting on what the FT said were “more targeted exemptions to copyright rules for certain scenarios and companies”.
📣 COMMENT: Publishers and creators will be heartened by the Lords’ report. Its urgent tone and sensible recommendations tackle all the main issues in AI and copyright. Once again peers have demonstrated their expertise and wisdom on the matter, and support for creatives in the face of Big Tech’s evasive and often misleading testimony. The question now of course is whether the government is listening. Right now the UK’s creative industries are waiting on tenterhooks. Each day that passes inflicts further damage on rightsholders. Creator groups are able to talk to Nandy’s department but are frustrated over the lack of engagement with Kendall’s team. Policymaking in this vitally important area should be shared by both ministers but still there’s a lingering suspicion that Kendall’s department — regarded as pro-tech and overly boosterish on unfounded forecasts of AI’s economic contribution — will have the final say. To be frank, it’s a mess. And if Labour is too blinkered to recognise it then on this matter it will pay a deep price politically. It’s time to wake up.
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ALSO THIS WEEK
💰 AI LICENSING
NEWS CORP CEO Robert Thomson this week vowed legal action against AI developers who are scraping the news publishers’ websites without consent or compensation. “If you are stealing our stuff [then] we are going to sue you,” Thomson warned shortly before The Wall Street Journal revealed News Corp had signed an AI licensing deal with Meta worth up to $50 million (£37.5 million, €43 million) a year “for at least three years”.
