Purpose

This bill regulates licensing agreements for electronic books and digital audiobooks between libraries and publishers. It aims to protect libraries’ ability to lend and provide access to electronic materials (including via interlibrary loan) and to limit restrictive terms in contracts. It creates a process that must be triggered only after Minnesota and other states meet a population-based threshold and a date is reached when the new rules take effect.

Key terms and definitions

• Aggregator: a party licensing access to electronic literary material from multiple publishers.
• Borrower: a person or organization (including another library) that receives a loan of electronic literary material.
• Digital audiobook: a spoken-recorded version of a literary work in digital form.
• Electronic book: a digital version of a text that can be read on devices.
• Electronic literary material: electronic books and/or digital audiobooks.
• Library: a public library serving residents, funded largely by public funds, defined by this statute (with certain exceptions like special libraries or school libraries).
• Loan: the library creates and transmits a copy to a borrower and later deletes that copy.
• Loan period: the time from loan creation to deletion.
• Portable electronic device: devices like phones, tablets, e-readers, etc.
• Publisher: any entity that manufactures or licenses books or similar works, including aggregators that license materials to libraries.
• Technological protection measure: security tech that protects loaning/circulation of electronic materials.
• Interlibrary loan: lending between libraries.

Applicability and effective date

• The new restrictions apply to library-publisher license contracts or renewals entered into or renewed after 60 days following a date when the secretary of state certifies that a substantially similar law has been enacted in one or more other states with a combined population of at least 7,000,000.
• The state librarian, in consultation with the secretary of state, must quarterly certify how many such states have enacted similar laws until the population threshold is met.
• Once the threshold is reached and the date is announced, the state librarian must notify the Department of Education and all libraries; the secretary of state and the Department of Education must post the determination and effective date on their websites and provide notices to relevant government entities and public schools.

Prohibited terms and contract requirements (main provisions)

Starting 60 days after the determination becomes effective, libraries may not enter into or renew contracts with publishers that preclude or restrict the library from: 1) loaning any electronic literary material, including via interlibrary loan. 2) controlling the number of times a library may loan a given electronic material, especially if the contract also restricts the loan period. 3) the number of electronic licenses the library may purchase on the date electronic materials become publicly available. 4) making nonpublic preservation copies of electronic literary material. 5) disclosing contract terms to other libraries. 6) the duration of the contract unless an option is available for either: - a pay-per-use model, or - perpetual public use of the material. 7) requiring the library to violate another law or regulation (specified as section 13.40 in the bill). 8) making the contract not severable from any prohibited provision (i.e., the contract cannot be saved by severing the problematic clause). 9) allowing enforcement of any prohibited provision outside a court (i.e., non-judicial enforcement is permitted for these issues).

Additional notes on effect and procedure

• The restrictions are tied to a threshold-triggered date; until then, normal licensing terms apply.
• The bill imposes government-led steps to inform libraries and ensure transparency (notifications to education and library systems, and postings on official websites).
• The bill treats certain networks and libraries (e.g., Minitex) as outside the defined “library” category for purposes of these rules.

Significance and potential impact

• If triggered, libraries will have greater freedom to lend electronic materials and manage licenses without restrictive contractual caps imposed by publishers.
• Publishers and aggregators would need to structure licenses to allow libraries to loan widely, preserve materials, and share information about contracts.
• The changes are designed to promote broader public access to electronic resources through libraries and to limit exclusive or restrictive license terms.

Relevant Terms electronic book; digital audiobook; electronic literary material; library; loan; loan period; interlibrary loan; aggregator; publisher; technological protection measure; nonpublic preservation copies; pay-per-use; perpetual public use; license contract; licensing agreement; substantially similar laws; population threshold; secretary of state; state librarian; commissioner of education; Minitex library network; interlibrary loan system; portable electronic device; public libraries.