'Google tax' gets closer in Germany – but don't expect any money to change hands

Although the so-called 'Google tax' has lost its most important features, it's on its way to becoming law, creating uncertainty for freelance journalists and business opportunities for lawyers.

Germany's ' Leistungsschutzrecht ' – an addendum to German copyright law that governs how aggregators can reuse media companies' content – last week cleared its second legislative hurdle and is now on its way to becoming law.

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German Bundestag votes on 'Google Tax'

Germany's ruling coalition has used it majority in the Bundestag to vote in a new addendum to the German copyright law which could require news aggregators to pay publishing houses for using their free content.

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The addendum passed Germany's upper house on Friday.

Surprisingly, the SPD, Germany's biggest opposition party and a former opponent of the Leistungsschutzrecht, didn't use its power to stop the highly controversial proposal. Instead, Peer Steinbrück, the party's challenger for the post of chancellor in Germany's upcoming general election, is promising to "get rid of the broken law" if he gets elected and the SPD gains the majority in parliament. 

One of the reasons Steinbrück believes the Leistungsschutzrecht is broken has to do with the current version. Initially intended to protect media outlets and publishing houses against unlicensed use of their content, it developed into something nicknamed the 'Google tax'. It would have forced aggregators like Google News or Bing News to pay for using 'snippets' – short introduction texts that media companies use as teasers.

In the current version, this stipulation has been completely removed, allowing news aggregators to again use snippets and quotes for free, but any more than that and they may end up having to pay publishers. The downside: the law doesn't define the length of a snippet, a legal loophole that will have to be closed by lawyers.

A victory for publishers?

Despite more than a year of heated discussion, the law changes nothing for companies like Google or Microsoft – a clear win for the aggregators over the publishers. Germany's publishers, however, are trying to sell the new law as a win. According to the publishers' organisation VDZ, the law "acknowledges the accomplishments of publishing houses for the first time".

Freischreiber, an organisation that represents freelance journalists in Germany and an opponent of the Leistungsschutzrecht, sees the new law as a threat to freelancers. "It creates legal uncertainty for freelancers," the organisation says on its blog. For example, it is not yet clear how the law will influence secondary use of articles. Most freelance journalist sell articles more than once to make up for reduced budgets of publishing companies.

International media experts and venture capitalists have also criticised the new law. Media pundit Jeff Jarvis said: "I am disappointed that the land of Gutenberg, the land that invented the ability to share knowledge and ideas at a mass scale and to empower speech is now haggling over the control and ownership of a few words. As they say in German, schade. What a shame." Albert Wenger of Union Square Ventures (whose investments include Twitter, Kickstarter and Tumblr) writes on his blog: "I agree that the LSR is the wrong approach because it is a blunt instrument that will have significant collateral damage."

The new law still needs to be signed by the German federal government and the German president, Joachim Gauck, to become a fully-fledged law. While it's still possible that the president will withhold his signature, it's highly unlikely in reality.