Under the proposal, a central body will be set up to collect royalty payments from AI companies and distribute them to creators whose content has been used. The working paper is open for public comments for 30 days.
According to the paper, the government is proposing that a committee will prescribe a royalty rate as a percentage of an AI company’s global revenue. The royalty obligation will apply only upon the commercialisation of an AI model. The framework also proposes making the AI fee retroactive, requiring companies to pay for data used in the past to train their models.
The proposal comes against the backdrop of ongoing litigation, as news agencies, publishers and digital creators have filed a copyright infringement case against OpenAI in the Delhi High Court. A decision is awaited.
Sources said the government may consider amending the Copyright Act based on public feedback to enable the AI royalty payment framework. Payment of the government-prescribed royalty, AI companies would be able to use any publicly available copyrighted content without seeking prior consent, a key industry demand, while ensuring compensation for a large ecosystem of creators.
They said that copyright holders would not have the option to opt out once the royalty is paid, ensuring AI companies guaranteed access to training data. Royalty rates set by the proposed committee would be subject to judicial review. Sources also said every creator would need to register their work with the central authority to receive payments.
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