The copyright law reform requires companies to filter content to prevent unauthorized work appearing on their platform. Smaller firms would exempt, but critics worry it will hurt the free exchange of information.
A majority of European Union member states on Friday agreed to a controversial compromise on reforming EU copyright law.
The changes to the copyright laws, proposed by the EU's executive in 2016, aim to make the bloc's rules adequate for the digital age by ensuring that artists and news publishers are fairly remunerated for work that appears online.
Twenty of 27 EU members voted in favor of the compromise hashed out by France and Germany that would exempt smaller companies from provisions on copyright infringements.
According to the compromise, companies must meet three criteria for exceptions: they must have existed for less than three years, their turnover must be less than €10 million and the number of users must be less than 5 million per month.
Companies above these thresholds must filter uploaded content according to lists provided by license-holders and prevent unauthorized works from reappearing on their platform. Exactly how YouTube, Facebook, Twitter and other online platforms would technically accomplish this has long been a point of dispute in Europe.
Until a few days ago, Germany and France did not have a uniform position on the reform, which had blocked the EU consultations since January.
Germany had wanted small businesses and start-ups to be exempted from the obligation to filter their content, but this was rejected by France.
European media, journalist and publisher associations wrote to Chancellor Angela Merkel (CDU) and French President Emmanuel Macron at the end of January to call for the deadlock to be lifted.
Knowledge is power
'Copyright rules fit for digital age'
The European Parliament and EU Commission still need to agree to the compromise.
Negotiations with the European Parliament are expected on Tuesday. If the negotiations are successful, the copyright reform — which has been delayed for months — could go ahead before European elections in May.
Andrus Ansip, vice president of the commission responsible for the digital sector, tweeted that he was glad EU member states had once again found "a common voice" on copyright reform and hopes a final agreement can be made next week.
"Europeans deserve copyright rules fit for digital age: it is good for creators, platforms and for regular internet users," Ansip said.
Concern over freedom of expression
The reform has been criticized over concern the measures will damage the free exchange of information, with some media outlets warning could spell "the death of the internet."
European Digital Rights (EDRi), a digital rights advocacy group, said that for websites that feature user-generated content, such as video-hosting platform YouTube, the reform poses "a fundamental threat to the freedom of expression of citizens."
"Content recognition technologies have so far an abysmal record in achieving their set out tasks," EDRi said in a statement. "They are fundamentally unfit to recognize the subtleties of parody, satire or any other exemption that the directive in principle recognizes, yet in practice makes impossible to protect."
EDRi also pointed out the huge job ahead for hosting service providers that will have to have licensing agreements for the content they host once the three-year exemption mark has passed.
"Any hosting service provider, however small it may be, and no matter how clearly its audience and services are defined, will be obliged to conclude licensing agreements with everyone producing content on the internet, meaning nearly any internet user," EDRi said.