Definition and Legal Classification of Complimentary Copies
Definition of Complimentary Copies
Complimentary copies are copies of a work that are provided free of charge to certain individuals or institutions. The term is mainly used in publishing, in the distribution of printed media such as books, newspapers, and magazines, as well as in the context of copyright and mandatory deposit copies. Complimentary copies can have various legal bases and include both statutorily required and contractually agreed copies.
Types of Complimentary Copies
Contractually Agreed Complimentary Copies
In publishing law, complimentary copies are often regulated as part of authors’ contracts. Authors generally receive a contractually specified number of copies of their published work without additional payment. The number and type of copies (hardcover, paperback, special editions) are negotiable and specified in the publishing contract.
Statutorily Mandated Complimentary Copies (Deposit Copies)
Statutorily mandated complimentary copies are, in particular, deposit copies that must be submitted to national and regional libraries according to the respective federal states’ laws. In Germany, this is governed by the Act on the Submission of Deposit Copies to the German National Library (DNBG) at the federal level, as well as the relevant media laws at the state level. The aim is the archiving and library cataloging of all publications.
Promotional Complimentary Copies (Review Copies)
Complimentary copies are frequently provided for marketing and promotional purposes, e.g., as review copies for the press, influencers, or booksellers. The aim is to increase awareness and reach of a work. Distribution is usually voluntary and follows the marketing strategies of the publishers or copyright holders.
Legal Framework for Complimentary Copies
Publishing Law Provisions
Publishing law, especially as regulated by the Publishing Act (VerlG), stipulates in § 15 VerlG that the author is entitled to at least five free specimen copies under a publishing contract, unless otherwise agreed. The exact number and type can be contractually adjusted.
Copyright Act (UrhG)
The Copyright Act (UrhG) does not contain explicit provisions on complimentary copies. Nevertheless, rights arising from complimentary copies must also be evaluated under copyright law, as authors gain a monetary advantage from the granting of complimentary copies, which may be part of the compensation for the transfer of rights. In some cases, complimentary copies are even relevant for tax purposes.
Legal Deposit Obligations (Deposit Copies)
According to § 16 (1) DNBG, anyone who publishes a work in Germany is required to submit two complimentary copies to the German National Library. The federal states have their own regulations for the submission of complimentary copies to state or regional libraries. Compliance with this deposit obligation ensures that all publications appearing in the country are documented and archived.
Tax Aspects
The provision of complimentary copies is relevant under German Value Added Tax law (UStG) if these are provided for purposes not predominantly entrepreneurial. Usually, the distribution of complimentary copies is considered a gratuitous supply of goods (§ 3 para. 1b UStG) and is therefore subject to VAT unless an exception applies (e.g. in the case of mandatory submissions to libraries).
Competition Law Considerations
The distribution of complimentary copies for promotional purposes may raise competition law issues, for example with regard to the prohibition of unfair commercial practices under the Act Against Unfair Competition (UWG). The prerequisite is that the distribution does not violate existing regulations regarding the promotional article exemption limit or good practice conduct rules.
Practical Relevance and Application Areas
Book Publishers and Authors
In the contractual relationship between book publishers and authors, complimentary copies are a common instrument in arranging the author’s compensation and mutual rights and duties. The standard practice is to provide a specified number of specimen copies immediately after the publication of the work.
Magazine and Newspaper Publishers
In the press sector, publishers regularly provide complimentary copies to editorial offices, advertising partners, or media distributors. The exact extent is regulated individually, but it is often part of distribution agreements and marketing strategies.
Academic Publications
In the academic sector, authors often receive a certain number of so-called “author’s copies” that may be used free of charge for teaching and research purposes. Relevant publishing conditions and internal institutional regulations apply.
Mandatory Deposit Submission to Libraries
The legally required submission of complimentary copies to public libraries is of central importance, especially in the publishing sector. Failure to comply with this obligation may lead to administrative offenses and fines as regulated by state media laws.
Distinctions and Particularities
Difference from Specimen Copies and Sample Items
Complimentary copies must be distinguished from pure specimen copies or sample items: while complimentary copies are generally provided for permanent use, sample copies are often only for testing and demonstration purposes.
Tax Assessment of Benefits in Kind
The distribution of complimentary copies may, from a tax perspective, be considered a monetary benefit, which can trigger income tax and VAT consequences. In particular, when distinguishing between promotional gifts and contractually owed complimentary copies, the respective maximum amount or flat-rate regulation must be observed.
Case Law and Literature
Court decisions and specialist literature repeatedly address the precise design and tax treatment of complimentary copies. Key reference points, in addition to the publishing contract, are especially the statutory deposit regulations and tax commentaries on the UStG.
Summary
Complimentary copies are an integral part of the German book, publishing, and library sector. Depending on their purpose—whether as contractually regulated author’s copies, legally mandated deposit copies, or voluntarily provided review copies—they are subject to different legal frameworks. Essential regulatory areas include the Publishing Act, the Act on the Submission of Deposit Copies, tax provisions, as well as competition law regulations. Their correct legal classification and handling are of great importance for publishers, authors, users, and institutions alike.
Frequently Asked Questions
When are publishers allowed to issue complimentary copies without the consent of the rights holders?
The release of complimentary copies by publishers is legally permitted only under narrow conditions. As a rule, every reproduction or distribution of a copyrighted work requires the consent of the rights holders, i.e., generally the author or licensor. Publishing contracts usually specify whether and to what extent the publisher has the right to create and distribute complimentary copies. Without an explicit agreement, the publisher is not entitled to give complimentary copies to third parties free of charge. This is only permissible if the publishing contract contains a corresponding clause—e.g., that the author and/or certain persons are entitled to a specified number of complimentary copies. If such a clause is missing, any unauthorized release can be considered a copyright infringement, which may give rise to claims for injunctive relief and damages.
What statutory regulations apply to the distribution of complimentary copies?
German copyright law does not explicitly regulate the distribution of complimentary copies in the statute, but it follows the general principle that reproductions and distributions are allowed only with the author’s consent (cf. §§ 15, 16, 17 UrhG). The specifics are usually normatively regulated in the publishing contract. Here, the number, group of beneficiaries, and intended use of the complimentary copies are defined. The publisher must also ensure that complimentary copies are not remunerated commercial goods; their distribution must not serve the sale of publisher products nor violate fixed book price laws or competition law. Tax law provisions may also become relevant, since the gratuitous distribution of copies can be subject to VAT under certain conditions.
Do authors have a statutory right to complimentary copies?
Authors do not have a statutory right to complimentary copies. Whether and how many complimentary copies the author receives is determined exclusively by the publishing contract concluded between the author and the publisher. In practice, it has become customary for authors to receive a certain amount (for example, five to twenty) as personal specimen copies. If there is no provision in the contract, there is no automatic entitlement. Some standard contracts, such as the model contract for publishing agreements, do include such provisions, but these are only binding if contractually agreed.
Do complimentary copies need to be labeled?
There is no explicit legal obligation to label complimentary copies. Nevertheless, for documentation purposes and to avoid violations of fixed book prices, it is advisable to identify complimentary copies as such or as specimen copies, for example by an appropriate imprint or stamp. This is particularly common in the field of academic literature. However, as long as contractual requirements are complied with, a lack of labeling does not have legal consequences as long as there is no deception about the status of the copy and no applicable fixed book price rules are circumvented.
May complimentary copies be sold or passed on?
The legal admissibility of selling or passing on complimentary copies depends on both copyright provisions and contractual requirements. In principle, any owner of a book may resell it—under the principle of exhaustion under copyright law—if it has been lawfully put into circulation (§ 17 para. 2 UrhG). However, publishing or author’s contracts may specify restrictions, such as that complimentary copies are not intended for resale, but only as specimen copies. Violations of such provisions can lead to contractual consequences. The commercial exploitation of books labeled as complimentary copies may also create problems with fixed book pricing or be considered anti-competitive if market prices are undercut.
What should be considered regarding the taxation of complimentary copies?
For tax purposes, German VAT law generally distinguishes between supplies for consideration and gratuitous supplies. The gratuitous provision of printed materials, including complimentary copies, can, as a rule, constitute a taxable transaction as a gratuitous supply (§ 3 para. 1b UStG) if the publisher was entitled to input VAT deduction for the production of the complimentary copies. In practice, however, complimentary copies to authors, employees, or press representatives are often exempt from VAT or recognized as ‘specimen copies.’ Nevertheless, it is recommended to consult a tax advisor in individual cases and to document the handling for external audits.
What risks do publishers face from improper distribution of complimentary copies?
Publishers face the risk of copyright and contractual claims if they distribute complimentary copies without a contractual basis or in violation of existing agreements. Authors may make claims for injunctive relief, damages, or additional remuneration. Violations of fixed book price requirements may also lead to competition law warnings. If complimentary copies are given market value or specifically used to circumvent usual market prices, this may also constitute a breach of price fixing law and unfair competition. Tax risks arise from improper documentation and VAT accounting, which can have adverse consequences in the event of a tax audit.
