On 18th March 2026, the UK Government published its Report on Copyright and Artificial Intelligence (the “Report”), alongside an economic Impact Assessment and a written Ministerial Statement. Jointly produced by the Department for Science, Innovation and Technology (DSIT) and the Department for Culture, Media and Sport (DCMS), the Report draws upon more than 11,500 responses to the December 2024 consultation (previously reported here).
The previous consultation set out four potential policy options:
- Option 0 — Do nothing (maintain the status quo)
- Option 1 — Strengthen copyright by requiring licensing in all cases
- Option 2 — Introduce a broad text and data mining (TDM) exception
- Option 3 — Introduce a TDM exception with an opt-out mechanism
While the government initially favoured Option 3, introducing such a broad text and data mining (TDM) exception received support from only 3% of respondents. On the one hand, responses from the creative industries raised concerns about the disproportionate burden this would place on rights holders, as well as the technical difficulties already seen under the EU’s opt-out model in the Digital Single Market Copyright Directive. On the other hand, AI developers questioned the practical value of such reform, noting that widespread opt-outs would likely undermine its effectiveness. In light of these responses, the government no longer considers Option 3 to be its preferred approach.
Decision – No Immediate Legislative Reform
The government has confirmed that it will not pursue legislative reform at this stage, noting that it “must take the time needed to get this right”. As a result, the status quo (Option 0) remains in place, requiring AI developers to obtain permission from rights holders before using copyright-protected works for training, except in cases of non-commercial research.
While the decision to step back from a broader text and data mining exception will likely be welcomed by the creative industries, it does little to resolve the persistent challenges around transparency in how works are used and the practical difficulties of enforcing rights in this context.
Further Aspects
The government acknowledges the ongoing need to provide a more suitable legal framework which ensures fair remuneration for rights holders while promoting a competitive environment in the UK for AI innovation. As such, the government intends to gather further evidence on how copyright law is affecting the development and deployment of AI across the economy, as well as the potential economic benefits of reform. This will include a closer assessment of the impact on copyright owners, developers, and users, with particular attention to SMEs and individuals.
It will also consider whether targeted interventions are required in light of that evidence and broader market developments, both domestically and internationally, including the implications for AI systems developed overseas but used within the UK. The government appears to be holding off on reform in this area pending greater clarity from the appeal in the Getty Images v Stability AI litigation, which directly addresses the matter of AI models being trained overseas.
The Report also comments on issues surrounding input transparency, output transparency, and technical standards, but proposes no present reform. It promises instead to work with industry to explore best practice on these matters, with the expectation that this may improve outcomes and inform future intervention with respect to licensing.
On the matter of enforcement, the government considers the current framework broadly effective but will continue working with experts, law enforcement partners, and the judiciary to ensure the framework remains suitable in line with any future reform, particularly for SMEs and micro businesses.
With respect to protection for computer-generated works, the consultation demonstrated minimal evidence that such protection is actively used or has any significant impact on the economy, creativity, or innovation, leading to the conclusion that it should be removed.
Finally, the Report recognises that the current framework is ill-equipped to address the risks posed by AI-generated digital replicas of individuals’ likenesses (so-called “deepfakes”). It proposes to explore various policy options to better handle this issue, including consideration of a potential new personality right.
Conclusion
The UK Government’s March 2026 Report on Copyright and Artificial Intelligence represents a significant step in the policy debate, but not a resolution of it. The twin objectives of supporting AI development and protecting the creative industries remain in tension, and the Report makes clear that no single approach yet commands sufficient consensus or evidence to justify legislation.
The government has recognised the complexity of the issues, the strength of competing interests, and the limits of the current evidence base. In declining to legislate at this stage, it has chosen caution over speed. What is clear is that this area will continue to evolve rapidly, through litigation, international regulatory developments, and market forces.
The above provides general commentary only and does not constitute specific advice.
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