Does your company want to place mobile phones, computers, hard drives, or other storage media on the market in Austria? Has your company received a letter from austromechana indicating that storage media are subject to compensation in Austria? Or has your company already been sued by austromechana?

Then you should familiarize yourself with the storage media compensation ("Speichermedienvergütung") in Austria - here are some details:

What is the storage media compensation?

Storage media compensation (SMV) is the designation for the Austrian copyright levy on certain storage media.

The justification for storage media compensation is that there is an exception for private copies in Austria, allowing copies of protected works to be made without the consent of the rights holders under certain conditions. As compensation for this permitted use, a compensation is collected if certain storage media is placed on the Austrian market, because collection from private users would be difficult. 

Who claims storage media compensation?

The storage media compensation is collected by austromechana also for other collecting societies. 

Which storage media are affected?

Generally, storage media that are typically suitable for making private copies are subject to compensation. This includes, for example:

• USB sticks, external hard drives, SSDs

• integrated storage in smartphones, tablets, computers

• memory cards (e.g., SD cards)

• blank CDs, DVDs, and Blu-rays

• other devices with integrated storage, such as MP3 players or digital photo frames

A list of the storage media for which austromechana claims compensation can be found on the website of austromechana.

Note:

1) austromechana also considers cloud storage to be subject to compensation. A clarification on whether this is actually the case is expected soon from the Supreme Court.

2) austromechana also regards refurbished products as subject to compensation – at least if no storage media compensation has been paid for these storage media in Austria before. There is no Supreme Court case law clarifying whether these products are subject to compensation. 

Rates

The rates demanded by austromechana can be found on austromechana's website here – examples include:

·       Integrated storage in mobile phones per unit € 5.50 (contract rate) € 8.25 (autonomous rate)

·       Integrated storage in tablets per unit € 5.50 (contract rate) € 8.25 (autonomous rate)

·       Integrated storage in PCs, desktop computers, notebooks, subnotebooks, ultrabooks, netbooks, laptops per unit € 7.50 (contract rate) € 11.25 (autonomous rate)

Until 2024, the rates were significantly lower.

The contract rate is granted to companies that submit to the inclusive contract (Gesamtvertrag) regime through individual contracts. In my opinion, this differentiation is unlawful under EU law – however, this has not yet been judicially clarified in Austria. 

Who has to pay the storage media compensation?

The compensation must be paid by the "first distributor," that is, the person who first commercially brings storage media into circulation in Austria.

Note:  

• Also placing the media on the market from abroad is covered – mail order companies that deliver storage media directly from abroad to Austrian consumers are therefore also liable to pay.

• Other dealers in the distribution chain are liable as guarantors and payers. If they paid, they can seek recourse from the main debtor. 

Are there exceptions?

Yes, if the party liable for payment can credibly demonstrate that the storage media are not being used by them or by third parties for reproductions for their own or private use, a "pre-exemption" is possible. 

Reporting obligation!

The company first placing the product on the Austrian market must report the type and quantity of the imported goods to austromechana quarterly – by the 15th day after the quarter (i.e., by April 15, July 15, October 15, January 15).

The Copyright Act provides that austromechana can demand double compensation if and insofar as there is no reporting or such reporting is incomplete or incorrect. In my opinion, this doubling is not applicable due to its unlawfulness under EU law – but this has not yet been clarified by the Austrian Supreme Court. 

Further notes

• Invoices must reference the storage media compensation.

• A refund of the paid storage media compensation to exporters and purchasers, which do not use the storage media for compensation-relevant copies is possible under certain conditions.

Have you received a letter from austromechana or do you need legal support from an attorney with many years of experience in storage media compensation in Austria? Contact ZEMANN IP gladly!