EU Copyright Law: A Commentary [2 ed.] 2020952047, 9781786437808, 9781786437792

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EU COPYRIGHT LAW

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ELGAR COMMENTARIES Elgar Commentaries provide essential article-by-article commentary on key regulations, treaties, directives and conventions. Volumes in the series principally take significant International or European instruments as their bases and provide analytical commentary on interpretation, implementation and case law surrounding each article of the respective instrument. Volumes also include valuable contextual information such as: insights into the drafting history of the instrument and analysis of the wider legislative landscape. Occasionally volumes take a thematic approach to important legal topics and encompass multiple associated regulations or directives. Covering a wide range of topics, volumes in the series are consistent in their methodological approach and follow a clearly structured, easy to reference format, making them comprehensive ‘go-to’ resources. Authored, or edited, by leading legal scholars and practitioners the volumes act as insightful points of reference for academic researchers, practising lawyers and policy makers alike. Titles in the series include: EU Regulation of E-Commerce A Commentary Edited by Arno R. Lodder and Andrew D. Murray European Competition Law A Case Commentary, Second Edition Edited by Weijer VerLoren van Themaat and Berend Reuder Commentary on the Energy Charter Treaty Edited by Rafael Leal-Arcas The ICSID Convention, Regulations and Rules A Practical Commentary Edited by Julien Fouret, Rémy Gerbay and Gloria M. Alvarez Children’s Rights A Commentary on the CRC and its Protocols Wouter Vandenhole, Gamze Erdem Türkelli and Sara Lembrechts A Commentary on the Council of Europe Convention on Action Against Trafficking in Human Beings Edited by Julia Planitzer and Helmut Sax EU Copyright Law A Commentary Second Edition Edited by Irini Stamatoudi and Paul Torremans

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EU COPYRIGHT LAW A Commentary Second Edition

Edited by

IRINI STAMATOUDI Professor, School of Law, University of Nicosia, Cyprus

PAUL TORREMANS Professor of Intellectual Property Law, School of Law, University of Nottingham, UK

ELGAR COMMENTARIES

Cheltenham, UK

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Northampton, MA, USA

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© Editors and Contributors Severally 2021 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical or photocopying, recording, or otherwise without the prior permission of the publisher. Published by Edward Elgar Publishing Limited The Lypiatts 15 Lansdown Road Cheltenham Glos GL50 2JA UK Edward Elgar Publishing, Inc. William Pratt House 9 Dewey Court Northampton Massachusetts 01060 USA

A catalogue record for this book is available from the British Library

Library of Congress Control Number: 2020952047

This book is available electronically in the Law subject collection http://dx.doi.org/10.4337/9781786437808

06

ISBN 978 1 78643 779 2 (cased) ISBN 978 1 78643 780 8 (eBook)

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CONTENTS

Extended contents List of contributors Table of cases Table of legal instruments

vii xxvii xxix xliii

Introduction Irini Stamatoudi and Paul Torremans

PART I

1

GENERAL PRINCIPLES OF EUROPEAN COPYRIGHT

1. Is there a concept of European copyright law? History, evolution, policies and politics and the acquis communautaire Agnès Lucas-Schloetter 2. The principle of non-discrimination Cristiana Sappa 3. The principle of free movement of goods: community exhaustion and parallel imports Benedetta Ubertazzi 4. The essential facilities principle and other issues of competition Alison Firth

PART II

6 17 33 44

THE EU DIRECTIVES AND REGULATIONS

5. The Software Directive Marie-Christine Janssens 6. The Rental and Lending Rights Directive Sylvie Nérisson 7. The Satellite and Cable Directive Jan Rosén 8. The Term Directive Gemma Minero 9. The Database Directive Estelle Derclaye 10. The Resale Right Directive Jens Gaster and Irini Stamatoudi 11. The Information Society Directive Christophe Geiger, Franciska Schönherr, Irini Stamatoudi, Paul Torremans and Stavroula Karapapa 12. The Enforcement Directive Irini Stamatoudi and Olivier Vrins 13. The Orphan Works Directive Uma Suthersanen and Maria Mercedes Frabboni 14. The Collective Rights Management Directive Lucie Guibault and Sabine Jacques 15. The Portability Regulation Katja Weckström Lindroos and Nguyen Ho Bich Hang

75 118 151 180 216 255 279 381 479 515 575

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CONTENTS 16. The Marrakesh Treaty on Certain Permitted Uses for the Benefit of Blind, Visually Impaired and Print-disabled Persons Raquel Xalabarder 17. The Digital Single Market Directive Irini Stamatoudi and Paul Torremans 18. Access and re-use of public sector information in a copyright perspective Cristiana Sappa 19. A United States perspective on Digital Single Market Directive Article 17 Jane C. Ginsburg 20. The Netcab Directive Tom Rivers

PART III

651 762 782 798

EU POLICIES AND ACTIONS

21. The EU policies and actions in the fight against piracy Olivier Vrins 22. Bringing Europe’s cultural heritage online: initiatives and challenges Nadine Klass, Hajo Rupp and Julia Wildgans 23. From a ‘Digital Agenda for Europe’, to a ‘Digital Single Market’, to a ‘Europe Fit for the Digital Age’: a decade of European Union copyright policy in the shadow of crises Benjamin Farrand 24. Intellectual property and the EU rules on private international law: match or mismatch? Paul Torremans 25. The export of EU copyright law: the example of the Free Trade Agreements Zoi Mavroskoti

PART IV

610

814 937 967 989 1024

PRESENT AND FUTURE OF COPYRIGHT IN THE EUROPEAN UNION

26. The EU stance in international matters Gillian Davies and Bernd Justin Jütte 27. The role of the Court of Justice in the development of EU copyright law: an empirical experience Marcella Favale 28. Towards a European copyright law: territoriality and limitations and exceptions as major outstanding issues Paul Torremans and Khamchanh Keosomphan 29. Advocating an EU copyright title Alain Strowel 30. Conclusion Irini Stamatoudi and Paul Torremans Index

1051 1073 1087 1104 1118

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EXTENDED CONTENTS

List of contributors Table of cases Table of legal instruments

xxvii xxix xliii

Introduction

0.01

PART I: GENERAL PRINCIPLES OF EUROPEAN COPYRIGHT 1. IS THERE A CONCEPT OF EUROPEAN COPYRIGHT LAW? HISTORY, EVOLUTION, POLICIES AND POLITICS AND THE ACQUIS COMMUNAUTAIRE I.

The evolution of copyright law within the European Union 1. The relationship between Copyright and Primary EC Law (1957–1987) 2. The harmonisation of copyright law within the European Community (1987–2007) 3. The increasing role of the ECJ since 2007 II. The achievement of a European copyright law? 1. The assessment of the acquis communautaire 2. From European common copyright principles to a genuine European copyright law III. Conclusion

1.02 1.03 1.07 1.11 1.14 1.14 1.19 1.23

2. THE PRINCIPLE OF NON-DISCRIMINATION I. II.

Introduction Non-discrimination via the principle of National Treatment in the international legal framework on copyright and related rights 1. Notion and scope of National Treatment 2. Origin and development of the National Treatment obligation 3. Exceptions to National Treatment: can they be overruled? 4. Next to National Treatment: the MFN clause III. Non-discriminatory treatment via the principle of National Treatment in the EU legal framework 1. General remarks 2. CJEU case law: some milestones 3. Exceptions to the National Treatment principle IV. Conclusion

2.01 2.09 2.09 2.12 2.17 2.18 2.20 2.20 2.24 2.28 2.30

3. THE PRINCIPLE OF FREE MOVEMENT OF GOODS: COMMUNITY EXHAUSTION AND PARALLEL IMPORTS I. Introduction II. Consent of the IPR owner and placement on the market III. International exhaustion

3.01 3.06 3.15

4. THE ESSENTIAL FACILITIES PRINCIPLE AND OTHER ISSUES OF COMPETITION I.

II.

Article 102 and its context 1. Introduction 2. Deconstructing Article 102 3. Competition 4. Abuse of dominance 5. A ‘defence’ of objective justification? Magill and beyond – essential facility cases relating to copyright 1. Magill

4.01 4.01 4.05 4.16 4.22 4.39 4.43 4.44

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EXTENDED CONTENTS 2. Tiercé Ladbroke 3. IMS 4. Microsoft III. Some queries and observations 1. Nature of ‘essential facility’ or ‘indispensable input’ in copyright cases 2. Nature of the remedy? 3. What about interim measures? 4. Essential facilities and WTO TRIPS 5. Where has the essential facilities doctrine gone? 6. Conclusion

4.50 4.51 4.56 4.64 4.64 4.68 4.69 4.70 4.76 4.80

PART II: THE EU DIRECTIVES AND REGULATIONS 5. THE SOFTWARE DIRECTIVE I.

Introductory remarks 1. Preparatory documents 2. General characteristics Article 1: Object of protection II. Commentary 1. Protection as literary works (art.1(1)) 2. Protection for expression; not ideas (art. 1(2)) 3. Condition of originality (art. 1(3)) 4. Transitional provision (art. 1(4)) Article 2: Authorship of computer programs II. Commentary 1. General rules 2. Computer programs created by employees (art. 2(3)) Article 3: Beneficiaries of protection II. Commentary Article 4: Restricted acts II. Commentary 1. Scope of the exclusive rights 2. Right of reproduction 3. Right of communication to the public 4. Moral rights not regulated 5. Enforcement of exclusive rights Article 5: Exceptions to the restricted acts II. Commentary 1. General remarks 2. Acts necessary for normal use and error correction 3. Making of back-up copy 4. Observing, studying or testing the functioning of the program Article 6: Decompilation II. Commentary 1. General 2. Conditions of the exception Article 7: Special measures of protection II. Commentary 1. General remarks 2. Particular remedies and sanctions 3. Seizure Article 8: Continued application of other legal provisions II. Commentary 1. No prejudice to other forms of protection 2. Mandatory character of the exceptions Article 9: Communication II. Commentary Article 10: Repeal Article 11: Entry into force II. Commentary Article 12: Addressees II. Commentary

5.01 5.01 5.02 5.06 5.06 5.14 5.33 5.40 5.42 5.42 5.49 5.57 5.58 5.58 5.60 5.92 5.94 5.96 5.98 5.98 5.103 5.109 5.112 5.115 5.115 5.117 5.134 5.134 5.136 5.143 5.145 5.145 5.147 5.148 5.150 5.152

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EXTENDED CONTENTS 6. THE RENTAL AND LENDING RIGHTS DIRECTIVE I.

General remarks

6.01

Chapter I: Rental and lending right Article 1: Object of harmonisation II. Commentary 1. The exclusive rights 2. Originals and copies 3. The relation to the exhaustion of the distribution right Article 2: Definitions II. Commentary 1. Definitions 2. Authorship of the principal director Article 3: Rightholders and subject matter of rental and lending right II. Commentary 1. Beneficiaries and subject matter of the rental and lending right 2. The transferability of the exclusive right 3. Presumptions in favour of the film producer Article 4: Rental of computer programs II. Commentary Article 5: Unwaivable right to equitable remuneration II. Commentary 1. The unwaivability of the right to remuneration 2. The role to be played by collecting societies Article 6: Derogation from the exclusive public lending right II. Commentary 1. Derogation from the exclusive right 2. Beneficiaries of the right to remuneration 3. The consideration of cultural promotion objectives 4. Exemption of certain categories of establishments Chapter II: Rights related to copyright II. Commentary Article 7: Fixation right II. Commentary 1. The fixation right for performers 2. The fixation right for broadcasting organisations Article 8: Broadcasting and communication to the public II. Commentary 1. Communication to the public 2. Equitable remuneration 3. Beneficiaries Article 9: Distribution right II. Commentary Article 10: Limitations to rights II. Commentary

6.09 6.10 6.18 6.21 6.23 6.24 6.41 6.43 6.44 6.50 6.51 6.55 6.58 6.59 6.64 6.65 6.67 6.68 6.70 6.73 6.75 6.77 6.78 6.81 6.83 6.86 6.91 6.96 6.99 6.103

Chapter III: Common provisions Article 11: Application in time II. Commentary Article 12: Relation between copyright and related rights II. Commentary Article 13: Communication Article 14: Repeal II. Commentary Article 15: Entry into force Article 16: Addressees

6.105 6.106 6.107

7. THE SATELLITE AND CABLE DIRECTIVE Chapter I: Definitions Article 1: Definitions I. Commentary 1. Introduction 2. Definition of a ‘satellite’ (art. 1(1))

7.01 7.01 7.07

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EXTENDED CONTENTS 3. 4. 5. 6.

Communication to the public (art. 1(2)(a)) The act of communication to the public occurs solely in one Member State (art. 1(2)(b)) Encryption of signals (art. 1(2)(c)) Extension of the communication to the public definition – satellite broadcasts from outside the EU (art. 1(2)(d)) Cable retransmission (art. 1(3)) Collecting society (art. 1(4))

7. 8.

Chapter II: Broadcasting of programmes by satellite Article 2: Broadcasting right I. Commentary 1. An exclusive broadcasting right in the country-of-origin (art. 2) Article 3: Acquisition of broadcasting rights I. Commentary 1. Acquisition by contract (art. 3(1)) 2. Collective licensing (art. 3(2)) 3. Cinematographic works (art. 3(3)) 4. Duty to inform (art. 3(4)) Article 4: Rights of performers, phonogram producers and broadcasting organisations I. Commentary 1. Related rights (art. 4(1)) 2. Wireless broadcasting (art. 4(2)) 3. Presumption of transfer (art. 4(3)) Article 5: Relation between copyright and related rights I. Commentary Article 6: Minimum protection I. Commentary 1. Minimum harmonisation (art. 6(1)) 2. Focus on up-link country (art. 6(2)) Article 7: Transitional provisions I. Commentary 1. Application in time (art. 7(1)) 2. Transitional provisions for old contracts (art. 7(2)) 3. Transitional provisions for co-production agreements (art. 7(3)) Chapter III: Cable retransmission Article 8: Cable retransmission right I. Commentary 1. Acquisition of cable retransmission rights (art. 8(1)) 2. Transitional provisions (art. 8(2)) Article 9: Exercise of the cable retransmission right I. Commentary 1. Mandatory collective rights management (art. 9(1)) 2. Treatment of outsiders (art. 9(2)) 3. Statutory presumptions (art. 9(3)) Article 10: Exercise of the cable retransmission right by broadcasting organisations I. Commentary 1. Broadcasters’ exception (art. 10) Article 11: Mediators I. Commentary 1. Set up of a mediation system (art. 11(1)) 2. Mediation procedure (art. 11(2) and (3)) 3. Independence and impartiality of mediators (art. 11(4)) Article 12: Prevention of the abuse of negotiating positions I. Commentary 1. Obligation to negotiate – but not to grant a licence (art. 12(1)) 2. Transitional provisions (art. 12(2) and (3))

7.12 7.17 7.20 7.25 7.27 7.32

7.34 7.34 7.37 7.37 7.40 7.43 7.44 7.45 7.45 7.48 7.49 7.51 7.52 7.52 7.53 7.55 7.55 7.58 7.60

7.63 7.63 7.67 7.68 7.68 7.71 7.73 7.74 7.74 7.76 7.76 7.78 7.79 7.80 7.80 7.83

Chapter IV: General provisions Article 13: Collective administration of rights I. Commentary 1. National rules unaffected (art. 13) Article 14: Final provisions I. Commentary

7.84 7.84 7.86

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EXTENDED CONTENTS 1. Implementation deadline and duty of notification (art. 14(1) and (2)) 2. Report of the Commission (art. 14(3)) Article 15 I. Commentary 1. No direct effect (art. 15)

7.86 7.87 7.89 7.89

8. THE TERM DIRECTIVE Chapter I: Objective and general remarks regarding duration of authors’ rights Article 1: Duration of authors’ rights I. General remarks and introduction to the Directive II. Duration of authors’ rights

8.01 8.13

Chapter II: Special rules for cinematographic or audiovisual works Article 2: Cinematographic or audiovisual works I. Authorship of cinematographic or audiovisual works II. Calculation of the term of the protection

8.25 8.30

Chapter III: Duration of related rights. Extended terms for performers and producers of phonograms Article 3 (as modified by Directive 2011/77/EU): Duration of related rights I. Duration of related rights. General rules II. Specific rules for performers and producers of phonograms. Amendments introduced by Directive 2011/77/EU

8.44

Chapter IV: Special rules for unpublished works Article 4: Protection of previously unpublished works I. Comments

8.52

Chapter V: Remarks on (national) protection of critical and scientific publications Article 5: Critical and scientific publications I. Comments

8.54

Chapter VI: Special rules for photographs Article 6: Protection of photographs I. Comments

8.56

Chapter VII: Treatment of aliens Article 7: Protection vis-à-vis third countries I. Comments

8.60

Chapter VIII: Rules for calculating terms of protection Article 8: Calculation of terms I. Comment

8.64

Chapter IX: Remarks on moral rights Article 9: Moral rights I. Comments

8.66

Chapter X: Effects of the Directive on running terms and other rules of application in time Article 10: Application in time I. Longer terms of protection of copyright or related rights already running in a Member State II. Application in time of the Directive III. Application in time of the modifications introduced by Directive 2011/77/EU

8.68 8.69 8.77

Chapter XI: Some remarks on national transitional measures Article 10a: Transitional measures I. Comments

8.79

Chapter XII: Notification and communication obligations Article 11 (codified version) Notification and communication I. Comments

8.81

Chapter XIII: Initial repeal Article 11 of the initial version, abolished in the codified version – Technical adaptation I. Comments

8.83

Chapter XIV: Repeal of the initial version of the Directive Article 12 (Codified version): Repeal I. Comments

8.85

8.35

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EXTENDED CONTENTS Chapter XV: Some considerations about the entry into force of the Directive Article 13 Directive 2006/116 and Article 4 of Directive 2011/77/EU: Entry into force I. Comments

8.86

Chapter XVI: Addressees Article 14 of Directive 2006/116 and Article 5 of Directive 2011/77/EU – Addressees I. Comments

8.88

9. THE DATABASE DIRECTIVE Chapter I: Scope Article 1: Scope I. Commentary 1. Paragraph 1 2. Paragraph 2 3. Paragraph 3 Article 2: Limitations on the scope I. Commentary

9.01 9.01 9.02 9.07 9.09

Chapter II: Copyright Article 3: Object of protection I. Commentary 1. Paragraph 1 2. Paragraph 2 Article 4: Database authorship I. Commentary Article 5: Restricted acts I. Commentary 1. Reproduction 2. Translation 3. Distribution 4. Communication to the public 5. Exhaustion 6. Infringement Article 6: Exceptions to restricted acts I. Commentary 1. Paragraph 1 2. Paragraph 2 3. Paragraph 3 4. Other copyright aspects not regulated by the Database Directive

9.12 9.12 9.16 9.17 9.20 9.21 9.22 9.23 9.24 9.25 9.26 9.27 9.27 9.28 9.29 9.30

Chapter III: Sui generis right Article 7: Object of protection I. Commentary 1. The nature of the sui generis right 2. Reasons for the sui generis right 3. Protection requirement: qualitative or quantitative substantial investment in the obtaining, verification or presentation of the database’s contents 4. Ownership 5. The rights 6. Infringement Article 8: Rights and obligations of lawful users I. Commentary 1. Concept of lawful user 2. Paragraph 1 3. Paragraph 2 4. Paragraph 3 Article 9: Exceptions to the sui generis right I. Commentary Article 10: Term of protection I. Commentary 1. Paragraphs 1 and 2 2. Paragraph 3 Article 11: Beneficiaries of protection under the sui generis right I. Commentary

9.31 9.31 9.32 9.33 9.44 9.45 9.51 9.57 9.58 9.60 9.61 9.62 9.63 9.68 9.68 9.69 9.71

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EXTENDED CONTENTS Chapter IV: Common provisions Article 12: Remedies I. Commentary Article 13: Continued application of other legal provisions I. Commentary Article 14: Application over time I. Commentary 1. Paragraph 1 2. Paragraph 2 3. Paragraphs 3, 4 and 5 Article 15: Binding nature of certain provisions I. Commentary Article 16: Final provisions I. Commentary

9.73 9.74 9.79 9.79 9.80 9.81 9.82 9.83

10. THE RESALE RIGHT DIRECTIVE I.

Commentary 1. The origins of resale right (droit de suite) 2. The nature of droit de suite 3. International regulation of the resale right 4. Need for harmonisation and EU competence 5. The genesis of Directive 2001/84/EC 6. The Resale Right Directive in one glimpse 7. Implementation in the Member States

10.01 10.01 10.05 10.06 10.08 10.10 10.16 10.17

Chapter I: Scope Article 1: Subject matter of the resale right I. Commentary 1. Article 1(1) Article 2: Works of art to which the resale right relates I. Commentary

10.24 10.24 10.30

Chapter II: Particular provisions Article 3: Threshold I. Commentary Article 4: Rates I. Commentary Article 5: Calculation basis I. Commentary Article 6: Persons entitled to receive royalties I. Commentary 1. Restrictions on the transmission of resale right post mortem 2. Commentary 3. Collective rights management Article 7: Third-country nationals entitled to receive royalties I. Commentary 1. Australia 2. United States 3. China Article 8: Term of protection of the resale right I. Commentary 1. United Kingdom 2. Austria 3. Ireland 4. The Netherlands 5. Luxembourg 6. Greece Article 9: Right to obtain information I. Commentary Chapter III: Final provisions Article 10: Application in time I. Commentary

10.33 10.36 10.43 10.44 10.46 10.49 10.52 10.57 10.63 10.68 10.72 10.74 10.79 10.80 10.81 10.82 10.83 10.84 10.85

10.87

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EXTENDED CONTENTS Article 11: Revision clause I. Commentary Article 12: Implementation I. Commentary Article 13: Entry into force I. Commentary Article 14: Addressees

10.88 10.96 10.99

11. THE INFORMATION SOCIETY DIRECTIVE I.

Commentary

11.01

Chapter I: Objective and scope Article 1: Scope I. Commentary 1. Scope (para 1) 2. Relationship with other Directives (para 2)

11.02 11.02 11.03

Chapter II: Rights and exceptions Article 2: Reproduction right I. Commentary Article 3: Right of communication to the public of works and right of making available to the public other subject matter I. Commentary 1. Introduction 2. The right of communication to the public 3. The right of ‘making available to the public’ 4. Hypertext links and cloud services 5. The notion of ‘public’ 6. Exhaustion of rights Article 4: Distribution right I. Commentary 1. Introduction 2. ‘Authors’ 3. ‘Original of their works or of copies thereof’ 4. ‘By sale or otherwise’ 5. Exhaustion of rights Article 5: Exceptions and limitations I. Commentary II. Method of harmonisation of Article 5 1. An exhaustive list of limitations 2. A list of predominantly optional limitations 3. The limit of Member States’ discretion: the three-step test of Article 5(5) III. Effect of Article 5 1. A degree of harmonisation 2. The role of case law IV. Possible revision of Article 5 1. Willingness to reform the EU system of limitations to copyright law 2. A transparent framework capable of coping with future developments 3. Relation to Technical Protection Measures (TPMs) and Article 6(4) of the Directive 4. Relation to moral rights V. Fair compensation, remuneration and the link to collective management 1. The notion of ‘fair compensation’ and the right to property 2. An exception justified by practical considerations and privacy protection: private copying and Article 5(2)(b) 3. Towards horizontal harmonisation of practical solutions? Chapter III: Protection of technological measures and rights-management information Article 6: Obligations as to technological measures I. Commentary 1. Background 2. Similar provisions in EU law 3. Effective technological measures (para. 3) 4. Circumvention (para. 1) 5. Preparatory acts (para. 2)

11.05 11.14 11.14 11.16 11.25 11.30 11.34 11.36 11.42 11.42 11.45 11.47 11.53 11.54 11.68 11.70 11.70 11.73 11.78 11.82 11.82 11.85 11.103 11.103 11.105 11.109 11.113 11.114 11.114 11.119 11.122

11.126 11.126 11.127 11.129 11.135 11.141

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EXTENDED CONTENTS Article 7: Obligations concerning rights-management information I. Commentary 1. Background 2. Rights management information 3. ‘Adequate legal protection’ for persons ‘knowingly’ performing ‘unauthorised’ acts of ‘works or protected subject matter’ 4. Actionable acts 5. Other issues

11.151 11.151 11.152 11.154 11.159 11.163

Chapter IV: Common provisions Article 8: Sanctions and remedies I. Commentary 1. Introduction 2. Article 8(1) 3. Article 8(2) 4. Article 8(3) – Injunctions against intermediaries Article 9: Continued application of other legal provisions I. Commentary Article 10: Application over time I. Commentary Article 11: Technical adaptations I. Commentary 1. Article 11(1) 2. Article 11(2) Article 12: Final provisions I. Commentary 1. Article 12(1) 2. Article 12(2) 3. Article 12(3) and (4) Article 13: Implementation I. Commentary Article 14: Entry into force I. Commentary Article 15: Addressees I. Commentary

11.165 11.165 11.168 11.170 11.171 11.194 11.196 11.198 11.198 11.200 11.202 11.202 11.203 11.204 11.207 11.208 11.209

12. THE ENFORCEMENT DIRECTIVE I.

Commentary 1. Introduction

12.01 12.01

Chapter I: Objective and scope Article 1: Subject matter I. Commentary 1. ‘Measures, procedures and remedies’ 2. ‘Intellectual property rights’ Article 2: Scope I. Commentary 1. Article 2(1) 2. Article 2(2) and (3)

12.06 12.06 12.07 12.10 12.10 12.16

Chapter II: Measures, procedures and remedies Section 1: General Provisions Article 3: General obligation I. Commentary Article 4: Persons entitled to apply for the application of the measures, procedures and remedies I. Commentary 1. Introduction 2. Article 4(a) and ‘holders’ of intellectual property rights 3. Article 4(b) and ‘all other persons authorised to use those rights’ 4. Article 4(c) and (d) Article 5: Presumption of authorship or ownership I. Commentary 1. Introduction 2. ‘Author’

12.23 12.29 12.29 12.33 12.36 12.39 12.44 12.44 12.46

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EXTENDED CONTENTS 3. 4.

‘On the work in the usual manner’ ‘Holders of rights related to copyright’

12.50 12.52

Section 2: Evidence Article 6: Evidence I. Commentary 1. Introduction 2. Article 6(1) 3. Article 6(2) Article 7: Measures for preserving evidence I. Commentary 1. Introduction 2. Article 7(1) 3. Article 7(2) 4. Article 7(3) 5. Article 7(4) 6. Article 7(5)

12.54 12.54 12.56 12.75 12.87 12.87 12.88 12.100 12.101 12.102 12.105

Section 3: Right of information Article 8: Right of information I. Commentary 1. Introduction 2. Article 8(1) 3. Article 8(2) 4. Article 8(3) 5. Conflicts between copyright protection and privacy in the light of the case law of the CJEU concerning ISPs Section 4: Provisional and precautionary measures Article 9: Provisional and precautionary measures I. Commentary 1. Introduction 2. Injunctions against ‘intermediaries’ 3. Seizure of goods 4. Precautionary seizure of assets to secure financial claims Section 5: Measures resulting from a decision on the merits of the case Article 10: Corrective measures I. Commentary Article 11: Injunctions I. Commentary 1. Introduction 2. Enforcing an injunction 3. Injunctions against intermediaries Article 12: Alternative measures I. Commentary Section 6: Damages and legal costs Article 13: Damages I. Commentary 1. Introduction 2. Article 13(1) 3. Article 13(2) Article 14: Legal Costs I. Commentary

12.106 12.106 12.109 12.116 12.117 12.127

12.129 12.129 12.142 12.148 12.151

12.160 12.169 12.169 12.174 12.176 12.184

12.192 12.192 12.196 12.205 12.206

Section 7: Publicity measures Article 15: Publication of judicial decisions I. Commentary

12.219

Chapter III: Sanctions by Member States Article 16: Sanctions by Member States I. Commentary

12.226

Chapter IV: Codes of conduct and administrative cooperation Article 17: Codes of conduct I. Commentary

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EXTENDED CONTENTS Article 18: Assessment I. Commentary Article 19: Exchange of information and correspondents I. Commentary

12.233 12.239

Chapter V: Final provisions Article 20: Implementation I. Commentary Article 21: Entry into force I. Commentary Article 22: Addressees

12.240 12.242

13. THE ORPHAN WORKS DIRECTIVE Article 1: Subject matter and scope I. Commentary 1. Rationale and objectives 2. Who are the beneficiary organisations? 3. Subject matter 4. Collective management and the Memorandum of Understanding on out-of-commerce works Article 2: Orphan works I. Commentary 1. Defining an orphan work 2. Multiple rightholders Article 3: Diligent search I. Commentary 1. What constitutes ‘diligent search’? 2. What constitutes ‘appropriate sources’? 3. Rules on extent and effect of diligent search 4. Recordation and public register Article 4: Mutual recognition of orphan work status I. Commentary 1. Rationale and expected benefits of the mutual recognition principle 2. If mutual recognition ceases to apply Article 5: End of orphan work status I. Commentary Article 6: Permitted uses of orphan works I. Commentary 1. Scope of permitted use 2. Beneficiaries 3. Compensation to rightholders Article 7: Continued application of other legal provisions I. Commentary Article 8: Application in time I. Commentary Article 9: Transposition I. Commentary Article 10: Review clause I. Commentary Article 11: Entry into force Article 12: Addresses

13.01 13.01 13.08 13.13 13.24 13.27 13.27 13.31 13.33 13.33 13.38 13.43 13.46 13.59 13.59 13.61 13.63 13.66 13.66 13.67 13.73 13.75 13.78 13.79 13.82

14. THE COLLECTIVE RIGHTS MANAGEMENT DIRECTIVE Introduction

14.01

Title I: General Provisions Article 1: Subject matter I. Commentary Article 2: Scope I. Commentary Article 3: Definitions I. Commentary

14.09 14.13 14.15

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EXTENDED CONTENTS Title II: Collective management organisations Chapter 1: Representation of rightholders and membership and organisation of collective management organisations I. Commentary Article 4: General principles I. Commentary Article 5: Rights of rightholders I. Commentary Article 6: Membership rules of collective management organisations I. Commentary Article 7: Rights of rightholders who are not members of the collective management organisation I. Commentary Article 8: General assembly of members of the collective management organisation I. Commentary Article 9: Supervisory function Article 10: Obligations of the persons who effectively manage the business of the collective management organisation I. Commentary

14.23 14.24 14.28 14.38 14.40 14.41

14.44

Chapter 2: Management of rights revenue Article 11: Collection and use of rights revenue Article 12: Deductions Article 13: Distribution of the amounts due to rightholders I. Commentary

14.46

Chapter 3: Management of rights on behalf of other collective management organisations Article 14: Rights managed under representation agreements Article 15: Deductions and payments in representation agreements I. Commentary

14.51

Chapter 4: Relations with users Article 16: Licensing I. Commentary Article 17: Users’ obligations I. Commentary

14.54 14.60

Chapter 5: Transparency and reporting Article 18: Information provided to rightholders on the management of their rights Article 19: Information provided to other collective management organisations on the management of rights under representation agreements Article 20: Information provided to rightholders, other collective management organisations and users on request Article 21: Disclosure of information to the public Article 22: Annual transparency report I. Commentary Title III: Multi-territorial licensing of on-line rights in musical works by collective management organisations Article 23: Multi-territorial licensing in the internal market I. Commentary Article 24: Capacity to process multi-territorial licences Article 25: Transparency of multi-territorial repertoire information Article 26: Accuracy of multi-territorial repertoire information Article 27: Accurate and timely reporting and invoicing Article 28: Accurate and timely payment to rightholders I. Commentary Article 29: Agreements between collective management organisations for multi-territorial licensing Article 30: Obligation to represent another collective management organisation for multi-territorial licensing Article 31: Access to multi-territorial licensing I. Commentary Article 32: Derogation for online music rights required for radio and television programmes I. Commentary

14.61

14.64

14.67

14.69 14.72

Title IV: Enforcement measures Article 33: Complaints procedure

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EXTENDED CONTENTS Article 34: Alternative dispute resolution procedures Article 35: Dispute resolution I. Commentary Article 36: Compliance Article 37: Exchange of information between competent authorities I. Commentary Article 38: Cooperation for the development of multi-territorial licensing

14.73

14.75

Title V: Reporting and final provisions Article 39: Notification of collective management organisations I. Commentary Article 40: Report Article 41: Expert Group I. Commentary Article 42: Protection of personal data I. Commentary Article 43: Transposition Article 44: Entry into force Article 45: Addressees I. Commentary

14.79

14.80 14.82

14.83

15. THE PORTABILITY REGULATION I. General remarks Article 1: Subject matter and scope I. Commentary 1. Subject matter 2. Scope Article 2: Definitions I. Commentary 1. Subscriber 2. Consumer 3. Member State of residence 4. Temporarily present in a Member State 5. Online content service 6. Portable Article 3: Obligation to enable cross-border portability of online content services I. Commentary 1. In the same manner 2. Any additional charges 3. Quality of service 4. Providing information Article 4: Localization of the provision of, access to and use of online content services I. Commentary Article 5: Verification of the Member State of residence I. Commentary 1. Means of verification 2. Reasonable doubts 3. Information necessary 4. Authorization 5. Withdrawing authorization Article 6: Cross-border portability of online content services provided without payment of money I. Commentary 1. General 2. Scope 3. Information Article 7: Contractual provisions I. Commentary 1. General scope 2. Effect of contractual provisions 3. Scope of regulation Article 8: Protection of personal data I. Commentary 1. Collecting data

15.01 15.04 15.04 15.06 15.09 15.09 15.10 15.11 15.12 15.14 15.16 15.17 15.18 15.21 15.22 15.24 15.26 15.27 15.27 15.28 15.31 15.32 15.33 15.34 15.34 15.35 15.36 15.37 15.37 15.40 15.41 15.42 15.42

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EXTENDED CONTENTS 2. Use of data 3. Destroying data Article 9: Application to existing contracts and rights acquired I. Commentary 1. Application 2. Transition Article 10: Review I. Commentary Article 11: Final Provisions I. Commentary

15.43 15.44 15.45 15.45 15.46 15.47 15.48

16. THE MARRAKESH TREATY ON CERTAIN PERMITTED USES FOR THE BENEFIT OF BLIND, VISUALLY IMPAIRED AND PRINT-DISABLED PERSONS I. The Marrakesh Treaty (2013) Directive (EU) 2017/1564 I. Introduction Article 1: Subject matter and scope I. Commentary 1. Human rights and copyright 2. Relationship between the Directive and the Regulation 3. Subsidiarity and proportionality principles Article 2: Definitions I. Commentary 1. Works or other subject matter 2. Beneficiary person 3. Accessible format copy 4. Authorized entities Article 3: Permitted uses I. Commentary 1. A mandatory exception 2. Scope of permitted uses 3. Conditions 4. Three-step test 5. Compensation not required, but possible (only for national AEs) 6. Prohibition on imposing additional requirements (no prior checking of commercial availability) 7. Protection of TPM but no contractual override of E&L Article 4: Accessible format copies in the internal market I. Commentary 1. Cross-border exchange of AFC within the internal market Article 5: Obligations of authorised entities I. Commentary Article 6: Transparency and exchange of information I. Commentary Article 7: Protection of personal data I. Commentary Article 8: Amendment to Directive 2001/29/EC I. Commentary Article 9: Report I. Commentary Article 10: Review I. Commentary Article 11: Transposition I. Commentary Article 12: Entry into force Article 13: Addressees Regulation (EU) 2017/1563 I. Commentary Article 1: Subject matter and scope I. Commentary Article 2: Definitions Article 3: Export of accessible format copies to third countries Article 4: Import of accessible format copies from third countries I. Commentary 1. Same conditions under national law

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16.01 16.20 16.29 16.32 16.37 16.40 16.43 16.43 16.52 16.55 16.58 16.61 16.61 16.64 16.69 16.74 16.76 16.80 16.84 16.98 16.99 16.108 16.119 16.122 16.124 16.130 16.134 16.138

16.144 16.147

16.150 16.153

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EXTENDED CONTENTS 2. Restrictions on the use of AFC in ‘Berne-gap’ countries 3. Cross-border exchange with non-signatory countries Article 5: Obligations of authorised entities Article 6: Protection of personal data Article 7: Review Article 8: Entry into force and application

16.162 16.165

17. THE DIGITAL SINGLE MARKET DIRECTIVE Title I: General provisions Article 1: Subject matter and scope I. Commentary Article 2: Definitions I. Commentary 1. Research organisations 2. Text and data mining 3. ‘Cultural heritage institution’ 4. ‘Press publication’ 5. ‘Information society service’ 6. ‘Online content-sharing service provider’

17.01 17.04 17.05 17.08 17.23 17.25 17.27 17.30

Title II: Measures to adapt exceptions and limitations to the digital and cross-border environment Article 3: Text and data mining for the purposes of scientific research I. Commentary 1. Introduction 2. Definition 3. Relevant economic rights II. Information Society Directive III. Database Directive 1. Copyright 2. Sui generis right 3. Contractual restrictions IV. Exceptions and limitations 1. Temporary acts of reproduction 2. Scientific research 3. Normal use of a database 4. Extraction of ‘insubstantial parts’ from a database protected by the sui generis right V. TDM in the DSM Directive 1. The basic rule 2. Storage of copies 3. Security and integrity of networks and databases 4. Best practices Article 4: Exception or limitation for text and data mining I. Commentary 1. Basic characteristics of the right 2. Storage of copies 3. Three-step test and technological protection measures Article 5: Use of works and other subject matter in digital and cross-border teaching activities I. Commentary Article 6: Preservation of cultural heritage I. Commentary Article 7: Common provisions I. Commentary

17.34 17.34 17.37 17.39 17.48 17.53 17.53 17.59 17.70 17.72 17.74 17.88 17.104 17.107 17.113 17.113 17.128 17.132 17.134 17.135 17.135 17.147 17.149 17.151 17.160 17.165

Title III: Measures to improve licensing practices and ensure wider access to content Chapter 1: Out-of-commerce works and other subject matter Article 8: Use of out-of-commerce works and other subject matter by cultural heritage institutions I. Commentary 1. Aim 2. Background 3. The notion of ‘out-of-commerce’ works 4. The two solutions for the online use of OOCWs 5. Licensing of OOCWs by representative CMOs 6. Online use of OOCWs by reason of an exception

17.167 17.167 17.168 17.172 17.183 17.185 17.191

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EXTENDED CONTENTS 7. Opt-out and publicity measures 8. Stakeholder dialogue Article 9: Cross-border uses I. Commentary Article 10: Publicity measures I. Commentary Article 11: Stakeholder dialogue I. Commentary

17.194 17.199 17.203 17.205 17.208

Chapter 2: Measures to facilitate collective licensing Article 12: Collective licensing with an extended effect I. Commentary

17.209

Chapter 3: Access to and availability of audiovisual works on video-on-demand platforms Article 13: Negotiation mechanism I. Commentary

17.214

Chapter 4: Works of visual art in the public domain Article 14: Works of visual art in the public domain I. Commentary

17.217

Title IV: Measures to achieve a well-functioning marketplace for copyright Chapter 1: Rights in publications Article 15: Protection of press publications concerning online uses I. Commentary 1. Background 2. The notion of ‘publishers of press publications’ 3. The rights granted 4. Express exclusions 5. The independency of the right 6. Authors entitled to a share of the revenues 7. Duration 8. Existing schemes of remuneration for authors and publishers Article 16: Claims to fair compensation I. Commentary Chapter 2: Certain uses of protected content by online services Article 17: Use of protected content by online content-sharing service providers I. Commentary 1. Communication to the public 2. Authorisation 3. No safe haven 4. The best efforts option 5. Start-ups 6. Exceptions and limitations 7. No general monitoring 8. The complaint and redress mechanism 9. The stakeholder dialogue Chapter 3: Fair remuneration in exploitation contracts of authors and performers Article 18: Principle of appropriate and proportionate remuneration I. Commentary Article 19: Transparency obligation I. Commentary Article 20: Contract adjustment mechanism I. Commentary Article 21: Alternative dispute resolution procedure I. Commentary Article 22: Right of revocation I. Commentary Article 23: Common provisions I. Commentary Title V: Final provisions Article 24: Amendments to Directives 96/9/EC AND 2001/29/EC I. Commentary

17.224 17.224 17.229 17.233 17.235 17.240 17.242 17.244 17.245 17.248

17.250 17.250 17.251 17.257 17.259 17.263 17.264 17.266 17.267 17.273

17.274 17.276 17.279 17.280 17.281 17.284

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EXTENDED CONTENTS Article 25: Relationship with exceptions and limitations provided for in other Directives I. Commentary Article 26: Application in time Article 27: Transitional provision I. Commentary Article 28: Protection of personal data I. Commentary Article 29: Transposition Article 30: Review Article 31: Entry into force Article 32: Addressees I. Commentary

17.286

17.287 17.288

17.289

18. ACCESS AND RE-USE OF PUBLIC SECTOR INFORMATION IN A COPYRIGHT PERSPECTIVE Chapter I: General provisions Article 1: Subject matter and scope Article 2: Definitions Article 3: General principle Chapter II: Requests for re-use Article 4: Processing of requests for re-use Chapter III: Conditions for re-use Article 5: Available formats Article 6: Principles governing charging Article 7: Transparency Article 8: Standard licences Article 9: Practical arrangements Article 10: Research data I. Introductory remarks II. The EU legal framework on PSI re-use III. PSI as subject matter of copyright IV. Copyrightable PSI: who owns the rights? V. Exceptions and limitations VI. Licences VII. Conclusions

18.01 18.10 18.15 18.19 18.23 18.26 18.31

19. A UNITED STATES PERSPECTIVE ON DIGITAL SINGLE MARKET DIRECTIVE ARTICLE 17 I. II

Introduction How 17 USC Section 512(C) Works 1. Overview of Section 512(c) 2. Technological and economic assumptions underlying OCILLA 3. Judicial interpretation III. How DSM Directive Article 17 Works 1. Basic structure 2. Who is an OCSSP? 3. Exceptions and user redress mechanisms IV. Comparing DSM Directive Article 17 to Section 512 of the US Copyright Act

19.01 19.04 19.04 19.06 19.10 19.19 19.20 19.25 19.30 19.31

20. THE NETCAB DIRECTIVE I.

Introductory comments

20.01

Chapter I: General provisions Article 1: Subject matter II. Commentary Article 2: Definitions II. Commentary

20.07 20.08

Chapter II: Ancillary online services of broadcasting organisations Article 3.1: Application of the country of origin principle to ancillary online services II. Commentary Article 3.2: Application of the country of origin principle to ancillary online services II. Commentary Article 3.3: Application of the country of origin principle to ancillary online services

20.11 20.17

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EXTENDED CONTENTS II.

Commentary

20.18

Chapter III: Retransmission of television and radio programmes Article 4: Exercise of the rights in retransmission by rightholders other than broadcasting organisations II. Commentary Article 5: Exercise of the rights in retransmission by broadcasting organisations II. Commentary Article 6: Mediation II. Commentary Article 7: Retransmission of an initial transmission originating in the same Member State II. Commentary Chapter IV: Transmission of programmes through direct injection Article 8: Transmission of programmes through direct injection II. Commentary

20.19 20.23 20.24 20.25

20.26

Chapter V: Final provisions Article 9: Amendment to Directive 93/83/EEC II. Commentary Article 10: Review II. Commentary Article 11: Transitional provision II. Commentary Article 12: Transposition Article 13: Entry into force Article 14

20.30 20.31 20.32

PART III: EU POLICIES AND ACTIONS 21. THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY I. Introduction II. From the Berne Convention to the WIPO internet treaties III. The awakening of the European Union to the problem of piracy 1. Genesis and development of the EU policies and actions in the fight against piracy 2. The EU approach to the fight against piracy in a nutshell IV. The fight against piracy in the internal market and at the EU’s external borders 1. Legislative actions 2. Non-legislative actions V. The fight against piracy on the internet 1. Legislative actions 2. Non-legislative actions VI. The fight against piracy in third countries 1. Legislative actions 2. Non-legislative actions 3. Assessment of the EU’s foreign policies on IPR enforcement VII. Conclusion: where do we stand and where are we going?

21.01 21.08 21.16 21.16 21.34 21.36 21.36 21.96 21.135 21.139 21.194 21.199 21.205 21.259 21.283 21.288

22. BRINGING EUROPE’S CULTURAL HERITAGE ONLINE: INITIATIVES AND CHALLENGES I. II.

The role of culture in the digital age Digitisation and preservation of Europe’s cultural memory: a key aspect of the EU Information Policy 1. Digitisation of cultural heritage: aims and benefits 2. Preserving cultural heritage III. The launch of Europeana and other European actions and initiatives on the digitisation, online accessibility and preservation of European cultural material 1. Europe’s digital agenda so far 2. Europe’s cultural heritage for all: the launch of Europeana IV. Digitisation and Copyright Law: a tension with consequences 1. Digitisation of public domain content 2. The digitisation of copyrighted material as a special challenge V. The Orphan Works issue 1. Cost and time-consuming rights clearance as an obstacle to digitisation and preservation 2. Directive 2012/28/EU of 25 October 2012 on certain permitted uses of orphan works

22.01 22.07 22.07 22.17 22.22 22.22 22.28 22.50 22.50 22.62 22.78 22.78 22.83

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EXTENDED CONTENTS 3. ARROW: Accessible Registries of Rights Information and Orphan Works VI. The Legal Challenge: finding the right balance in the digital age 1. Tensions between creators, intermediaries and the public: an interest analysis 2. Interest implications VII. Policy conclusion

22.90 22.98 22.102 22.115 22.116

23. FROM A ‘DIGITAL AGENDA FOR EUROPE’, TO A ‘DIGITAL SINGLE MARKET’, TO A ‘EUROPE FIT FOR THE DIGITAL AGE’: A DECADE OF EUROPEAN UNION COPYRIGHT POLICY IN THE SHADOW OF CRISES I. II.

Introduction The Digital Agenda for Europe: a recap 1. What the Digital Agenda for Europe sought to achieve 2. Where the Digital Agenda was ultimately successful 3. Where the Digital Agenda did not achieve its policy objectives III. The Digital Single Market Strategy: a road paved with good intentions 1. What the Digital Single Market Strategy sought to achieve 2. Where the Digital Single Market Strategy was ultimately successful 3. Where the Digital Single Market Strategy did not achieve its policy objectives IV. A Europe fit for the digital age: copyright policy in the shadow of internet regulation 1. What is ‘A Europe Fit for the Digital Age’? 2. What is the place of copyright in Digital Age Europe? 3. Populism, politics and precarity: copyright as tangential to larger policy concerns V. Concluding thoughts

23.01 23.04 23.05 23.08 23.11 23.14 23.15 23.18 23.22 23.26 23.28 23.32 23.35 23.38

24. INTELLECTUAL PROPERTY AND THE EU RULES ON PRIVATE INTERNATIONAL LAW: MATCH OR MISMATCH? I. II.

Introduction Jurisdiction 1. The starting point 2. Article 7.2 Brussels I (recast) 3. Article 8.1 Brussels I (recast) 4. Article 24(4) III. Choice of law 1. The Rome I Regulation 2. The Rome II Regulation IV. Conclusion

24.01 24.02 24.02 24.03 24.07 24.13 24.35 24.36 24.69 24.99

25. THE EXPORT OF EU COPYRIGHT LAW: THE EXAMPLE OF THE FREE TRADE AGREEMENTS I. II.

Introduction Overview of the EU Free Trade Agreements 1. ‘First-generation’ agreements 2. ‘Second-generation’ agreements 3. Economic Partnership Agreements (EPAs) III. Conclusion: towards ‘international’ EU copyright law (?)

25.01 25.09 25.09 25.28 25.65 25.79

PART IV: PRESENT AND FUTURE OF COPYRIGHT IN THE EUROPEAN UNION 26. THE EU STANCE IN INTERNATIONAL MATTERS I.

Introduction 1. The EU’s mandate in international matters 2. The role of the European Commission 3. A new EU player on the IP scene – The European External Action Service (EEAS) II. The Beijing Treaty on Audiovisual Performances 1. The follow-up to the WPPT 2. Proposal for a Protocol concerning audiovisual performances 3. The establishment of the SCCR in 1998 4. Position of the EU on the draft Protocol 5. Transfer of rights 6. The Diplomatic Conference of 2000 and its aftermath 7. The breaking of the deadlock III. The Draft Treaty on the Protection of Broadcasting Organisations 1. The existing international framework for the protection of broadcasting organisations 2. WIPO programme on the protection of broadcasting organisations

26.01 26.01 26.04 26.05 26.06 26.06 26.09 26.12 26.13 26.14 26.16 26.17 26.20 26.20 26.22

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EXTENDED CONTENTS 3. The position of the EU 4. The emergence of a draft treaty IV. Proposals concerning exceptions and limitations to copyright 1. The initial proposal from Chile 2. The position of the EU 3. EU proposal for a recommendation on access to works by persons with print disabilities 4. Other proposals 5. The EU response 6. Emergence of draft texts on limitations and exceptions V. Proposals for the protection of folklore (traditional cultural expressions) 1. Background 2. EU stance on folklore 3. Ongoing work in the IGC on folklore 4. Issues still to be resolved 5. Future work VI. Conclusions

26.24 26.27 26.32 26.32 26.35 26.36 26.37 26.38 26.40 26.47 26.47 26.49 26.52 26.54 26.56 26.57

27. THE ROLE OF THE COURT OF JUSTICE IN THE DEVELOPMENT OF EU COPYRIGHT LAW: AN EMPIRICAL EXPERIENCE I. II. III. IV. V. VI. VII.

Introduction The role of the CJEU in EU Governance Rules of procedure The legal approaches used by the Court and the legal background of the judges The impact of written observations of Member States on the rulings of the Court The confidentiality issue Conclusion

27.01 27.04 27.08 27.17 27.26 27.42 27.55

28. TOWARDS A EUROPEAN COPYRIGHT LAW: TERRITORIALITY AND LIMITATIONS AND EXCEPTIONS AS MAJOR OUTSTANDING ISSUES I. Introduction II. The territoriality issue III. Copyright exceptions and limitations: more flexibility 1. Additional exceptions and limitations based on other fundamental rights 2. Towards an answer in the Grand Chamber of the Court of Justice of the European Union IV. Conclusion

28.01 28.04 28.17 28.18 28.26 28.49

29. ADVOCATING AN EU COPYRIGHT TITLE I.

II. III.

IV. V. VI. VII. VIII.

The many facets of copyright harmonization and reform 1. Facets of copyright harmonization 2. The activism of the Court of Justice of the EU 3. Additional copyright fixes as an alternative to a unitary copyright 4. Need to rely on hard and soft law and to build the infrastructure of copyright A unified copyright title as a possible way forward for the European Commission A unified copyright title as a response to the territoriality issues and as a better fit for the Internet 1. Beyond the legal fictions of the country of origin rules and of the mutual recognition 2. Territorial restrictions by contract 3. Multiplicity of territoriality issues A unitary copyright with a new EU copyright court system An optional EU copyright title A commented European copyright code as a first step A copyright title on the model of the unregistered design right as a second step Conclusions

29.01 29.01 29.02 29.05 29.06 29.07 29.12 29.12 29.15 29.18 29.19 29.21 29.25 29.26 29.31

30. CONCLUSION

1118

Index

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CONTRIBUTORS

Gillian Davies, DL, Dr, Barrister, of Hogarth Chambers, Lincoln’s Inn, London, Honorary Professor at the University of Aberystwyth; Visiting Professor at the Centre for Commercial Law Studies, Queen Mary, University of London. Estelle Derclaye, Dr, Professor of Intellectual Property Law, University of Nottingham. Benjamin Farrand, Dr, Reader in Law and Emerging Technologies, Newcastle Law School, Newcastle University. Marcella Favale, Dr, Senior Research Fellow in Intellectual Property Law, Bournemouth University. Alison Firth, Professor Emeritus, School of Law, University of Surrey; Visiting Professor, Centre for Commercial Law Studies, Queen Mary, University of London; Visiting Professor, Newcastle Law School, Newcastle University. Maria Mercedes Frabboni, Dr, Lecturer in Law, School of Law, Politics and Sociology, University of Sussex. Jens Gaster, Dr, European Commission (retired). Christophe Geiger, Dr, Professor of Law and Director of the Research Department of the Centre for International Intellectual Property Studies (CEIPI), University of Strasbourg. Jane C. Ginsburg, Dr, Morton L. Janklow Professor of Literary and Artistic Property Law, Columbia University. Lucie Guibault, Dr, Associate Professor of Law; Associate Dean, Graduate Studies; Associate Director, Law and Technology Institute, Dalhousie University. Sabine Jacques, Dr, Associate Professor, School of Law, University of East Anglia. Marie-Christine Janssens, Dr, Professor of Law and Head of Unit Centre for IT & IP Law (CiTiP), University of Leuven. Bernd Justin Jütte, Dr, Assistant Professor in Intellectual Property Law, University College Dublin, Sutherland School of Law and Senior Researcher, Vytautas Magnus University, Kaunas, Lithuania. Stavroula Karapapa, Dr, Professor of Intellectual Property and Information Law, School of Law, University of Essex. Khamchanh Keosomphan, LLM, Northern Justice Institution, Luang Prabang, Laos. Nadine Klass, LLM, Dr, Professor of Civil Law, Intellectual Property and Media Law and Civil Procedure Law, University of Mannheim. Agnès Lucas-Schloetter, Dr, Professor, Faculty of Law, Ludwig-Maximilian University of Munich.

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CONTRIBUTORS Zoi Mavroskoti, Dr, Attorney-at-Law, Member of the Athens Bar Association. Gemma Minero, LLM, Dr, Assistant Professor, Faculty of Law, University Autonoma, Madrid. Sylvie Nérisson, Dr, Maître de Conférences, IUT Bordeaux Montaigne/IRDAP Université de Bordeaux, Affiliated Research Fellow, Max Planck Institute for Innovation and Competition, Munich. Nguyen Ho Bich Hang, Dr, Postdoctoral Researcher, Commercial Law, University of Eastern Finland. Tom Rivers, Vice-President BLACA. Jan Rosén, Dr, Professor Emeritus of Private Law, Faculty of Law, University of Stockholm. Hajo Rupp, LLM, Dr. Cristiana Sappa, Dr, Associate Professor in Business Law, Iéseg School of Management, Département Management, Lille. Franciska Schönherr, Dr. Irini Stamatoudi, Dr, Professor of Law, School of Law, University of Nicosia, Cyprus. Alain Strowel, Dr, Professor, Université Catholique de Louvain and Université Saint-Louis, Belgium. Uma Suthersanen, Dr, Professor of Global Intellectual Property Law, Queen Mary, University of London. Paul Torremans, Dr, Professor of Intellectual Property Law, University of Nottingham. Benedetta Ubertazzi, LLM, Aggregate Professor of European Union Law at University of Milano-Bicocca. Olivier Vrins, LLM, Attorney-at-Law, ALTIUS, Brussels; Member of the pool of experts of the European Observatory on Infringements of Intellectual Property Rights and Member of the Belgian Intellectual Property Council. Katja Weckström Lindroos, Dr, Professor of Commercial Law, University of Eastern Finland. Julia Wildgans, PhD candidate and researcher at the Chair of Civil Law, Intellectual Property and Media Law and Civil Procedure Law, University of Mannheim. Raquel Xalabarder, Dr, Professor of Intellectual Property Law, Universidad Oberta de Catalunya, Barcelona.

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TABLE OF CASES

ACI Adam BV (C-435/12) EU:C:2014:254 .............................. 11.77, 11.81, 11.115, 11.121, 12.10, 12.208, 28.42 Airfield NV v Agicoa Belgium BVBA (C-277/10) ECLI:EU:C:2012:65 ............................................................ 7.12 Airfield NV and Canal Digitaal BV v Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (Sabam) (C-431/09 and C-432/09) ECLI:EU:C:2011:157 ......................................... 7.12, 7.14, 11.24, 11.35 AKM (C-138/16) ECLI:EU:C:2017:218 .............................................................................................................. 7.10 Akzo Chemie BV v Commission (62/86) [1991] ECR 461 ........................................................................ 4.14, 4.25 Alessandro Tedesco v Tomasoni Fittings and RWO Marine Equipment (C-175/06) ECLI:EU:C:2007:451 ............................................................................................................................... 12.104 Almelo v NV Energiebedrif Ijss elmij (C-393/92) [1994] ECR I-1477 .............................................................. 4.03 Amazon.com International Sales Inc and Others v Austro-Mechana Gesellschaft zur Wahrnehmung mechanisch-musikalischer Urheberrechte Gesellschaft mbH (C-521/11) [2013] EUECJ .......... 11.119, 14.49 AMS Neve Ltd, Barnett Waddingham Trustees and Mark Crabtree v Heritage Audio SL and Pedro Rodríguez Arribas (C-172/18) ECLI:EU:C:2019:674 .............................................................................. 24.92 Andreas Grund acting as administrator in the insolvency proceedings concerning the assets of SR-Tronic GmbH, and Others v Nintendo Co Ltd and Nintendo of America Inc (C-458/13), Order of the Court of 7 May 2014 ................................................................................................................................ 11.127 Apis-Hristovich EOOD v Lakorda AD (C-545/07) [2009] ECR I-1627 ................................................. 9.46, 9.53 ARD (C-6/98) [1999] ECR I-7599 .................................................................................................................... 15.37 Art & Allposters (C-419/13) ................................................................................................................................ 11.56 Asociación Profesional Elite Taxi (C-434/15) EU:C:2017:981 ............................................................. 17.29, 17.234 AstraZeneca v Commission (C-457/10) EU:C:2012:770 ............................................................................ 4.13, 4.76 Basset v SACEM (402/85) [1987] ECR I-1747 ...................................................................................... 14.29, 16.76 Bastei Lübbe GmbH & Co KG v Michael Strotzer (C-149/17) ECLI:EU:C:2018:841 ..................... 12.66, 21.136 Bayer Pharma AG v Richter Gedeon Vegyészeti Gyár Nyrt and Others (C-688/17) ECLI:EU:C:2019:722 ............................................................................................................................... 12.140 Beecham Group v Andacon NV (C-132/07) ECLI:EU:C:2008:205 ...................................................... 10.22, 21.01 Belgische Radio en Televisie (BRT) v SABAM (127/73) [1974] ECR 51 ........................................................ 14.27 BelgischeVereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV (C-360/10) ECLI:EU:C:2012:85 .... 11.172, 11.176, 12.18, 12.26, 12.122, 12.133, 12.181, 17.266, 21.49, 21.57, 21.158, 21.160, 21.162, 28.24 Bericap Záródástechnikai Bt v Plastinnova 2000 Kft (C-180/11) ECLI:EU:C:2012:717 .................... 12.10, 12.208 BestWater International GmbH v Michael Mebes, Stefan Potsch (C-348/13) [2014] EUECJ ........... 11.31, 11.33, 11.101 Bezpeĉnostní softwarová asociace – Svaz softwarové ochrany (BSA) v Ministerstvo kultury (Softwarová) (C-393/09) see Softwarová Bolagsupplysningen OÜ and Ingrid Ilsjan v Svensk Handel AB (C-194/16) ECLI:EU:C:2017:766 ............... 28.13 Bonnier Audio AB, Earbooks AB, Norstedts Förlagsgrupp AB, Piratförlaget AB, Storyside AB v Perfect Communication Sweden AB (C-461/10) ECLI:EU:C:2012:219 ........ 11.190, 12.26, 12.114, 12.122, 12.127, 21.166 British Airways v Commission (C-95/04 P) [2007] ECR I-2331 ........................................................................ 4.39 British Horseracing Board (BHB) Ltd and Others v William Hill Organization Ltd (C-203/02) [2004] ECR I-10415 ......................................... 3.11, 9.21, 9.38, 9.45, 9.46, 9.47, 9.52, 9.56, 17.62, 17.67, 17.110, 17.111 Brüstle v Greenpeace (C-34/10) [2011] ECR I-09821 ................................................................. 5.79, 11.34, 17.174 Bundesverband der Arzneimittel-Importure eV (BAI) and Commission v Bayer (C-2/01 and 3/01P) [2004] ECR I-23 ...................................................................................................................................................... 4.03 Butterfly Music Srl v Carosello Edizioni Musicali e Discografiche Srl (C-60/98) [1999] ECR I-03939 ....................................................................................................................................... 8.71, 8.76 C More Entertainment (C-279/13) ECLI:EU:C:2015:199 .................... 11.24, 11.25, 11.31, 11.101, 16.65, 17.236 Calfa (C-348/96) [1999] ECR I-11 ..................................................................................................................... 15.06

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TABLE OF CASES Canon Deutschland GmbH (C-458/11) and Fujitsu Technology Solutions GmbH (C-459/11) ................... 17.138 Cassina v Peek & Cloppenburg (C-456/06) ECLI:EU:C:2008:232 ........................................................... 1.12, 1.13 Centros v Erhvervs-og Selskabsstyrelsen (C-212/97) [1999] ECR I-1459 ......................................................... 15.06 Christian Liffers v Producciones Mandarina SL en Mediaset España Comunicación SA (C-99/15) ECLI:EU:C:2016:173 .................................................................................................... 12.197, 12.201, 12.203 CILIFT (283/81) [1982] ECR 3415 ................................................................................................................... 27.07 Cipolla and Others (C-94/04 and C-202/04) [2006] ECR I-11421 .................................................................. 15.37 Circul Globus Bucureşti (Circ & Variete Globus Bucureşti) v Uniunea şi Muzicologilor din România – Asociaţia pentru Drepturi de Autor (UCMR – ADA) (C-238/10) [2011] ECR I-12031 ...................... 11.25 Coditel v CinéVog Films (C-62/79) [1980] ECR 881 ....................................... 1.05, 1.06, 3.09, 3.10, 11.36, 15.37 Coditel v CinéVog Films II (C-262/81) [1982] ECR 3381 ...................................................................... 1.06, 11.36 Cofermel v G-Star Raw (C-683/17) ECLI:EU:C:2019:721 ................................................... 1.15, 8.59, 9.13, 29.24 Commercial Solvents v Commission (C-6/73 and 7/73) [1974] ECR 223, [1974] 1 CMLR 309 ..................... 4.05 Commission v Belgium (C-355/98) [2000] ECR I-1221 ................................................................................... 15.06 Commission v France (C-23/99) [2000] ECR I-7653 ........................................................................................ 15.37 Commission v France (C-328/07) ECLI:EU:C:2008:113 ................................................................................ 12.241 Commission v Germany (C-61/94) [1996] ECR I-3989 .......................................................................... 4.74, 11.79 Commission v Germany (C-395/07) ECLI:EU:C:2008:325 ............................................................................ 12.241 Commission v Ireland (C-175/05) [2007] OJ C42/07 .......................................................................................... 6.73 Commission v Italy (C-224/00) [2002] ECR I-02965 ......................................................................................... 2.27 Commission v Italian Republic (C-198/05) [2006] OJ C326/06 .......................................................................... 6.73 Commission v Luxembourg (C-329/07) ECLI:EU:C:2008:9 ........................................................................... 12.241 Commission v Portuguese Republic (C-53/05) [2006] OJ C212/06 ........................................................... 6.73, 6.99 Commission v Portuguese Republic (C-61/05) [2006] OJ C224/06 .................................................. 6.39, 6.46, 6.51 Commission v Kingdom of Spain (C-36/05) [2006] OJ C326/06 ....................................................................... 6.73 Commission v Sweden (C-341/07) ECLI:EU:C:2008:284 ............................................................................... 12.241 Commission v Systran SA and Systran Luxembourg SA (C-103/11) EU:C:2013:245 ................... 5.44, 5.98, 5.102 Compass-Datenbank GmbH v Republik Österreich (C-138/11) [2012] 5 CMLR 13 .............................. 4.06, 4.34 Consorzio Italiano della Componentistica di Ricambio per Autoveiculi (CICRA) and Maxicar v Régie des Usines Renault (53/87) [1988] ECR 6039 ................................................................................... 4.13, 4.31 Constantin Film Verleih v YouTube and Google (C-264/19) ECLI:EU:C:2020:542 ......................... 12.116, 21.48 Continental Can Europemballage Corporation and Continental Can Company Inc v Commission (C-6/72) [1973] ECR 215 ........................................................................................................................................... 4.11 Coöperatieve Vereniging SNB-REACT UA v Deepak Mehta (C-521/17) ECLI:EU:C:2018:639 ...... 12.37, 12.39 Copydan Båndkopi v Nokia Danmark A/S (C-463/12) [2015] EUECJ ............................................... 11.117, 16.76 Coty Germany v Stadtsparkasse Magdeburg (C-580/13) ECLI:EU:C:2015:485 ........ 12.18, 12.26, 12.106, 12.114, 12.128, 21.48 Coty Germany GmbH (formerly Coty Prestige Lancaster Group) v First Note Perfumes NV (C-360/12) ECLI:EU:C:2014:1318 .................................................................................................................... 24.04, 24.05 Coty Prestige Lancaster Group (C-127/09) [2010] ECR I-4965 ....................................................................... 11.50 Criminal proceedings against Titus Alexander Jochen Donner (C-5/11) [2012] EUECJ ................................. 11.42 Criminal proceedings against Tullio Ratti (148/78) [1979] ECR 1629 .............................................................. 5.154 Cowan v Trésor Public (C-186/87) [1989] ECR I-00195 .................................................................................... 2.21 Dansk Supermarked v Imerco (58/80) [1981] ECR 181 ........................................................................... 3.07, 11.64 Deckmyn (C-201/13) ECLI:EU:C:2014:2132 .................................................................................................... 16.62 Der Grüne Punkt Duales System v Commission (C-385/07) [2009] ECR I-06155; [2009] CMLR 19 ........... 4.24 Deutsche Grammophon v Metro (C-78/70) [1971] ECR 487 ............................................... 1.05, 3.07, 5.76, 11.64 Deutsche Milchkontor and Others v Germany (205/82 to 215/82) [1983] ECR 2633 ..................................... 11.86 DHL Express France SA (formerly DHL International SA) v Chronopost SA (C-235/09) ECLI:EU:C:2011:238 ................................................................................................................................. 21.66 Diageo Brands v Simiramida-04 EOOD (C-681/13) ECLI:EU:C:2015:471 ..................................... 12.103, 12.140 Directmedia Publishing v Albert-Ludwigs-Universität Freiburg (C- 304/07) [2008] ECR I-7565 .................... 9.46 DR and TV2 Danmark (C-510/10) ECLI:EU:C:2012:244, [2012] 2 CMLR 46 ............ 5.79, 11.34, 11.86, 11.96, 17.174 Duff and others (C-63/93) [1996] ECR I-569 ................................................................................................... 11.86 Duijnstee v Goderbauer (288/82) [1983] ECR 3663 .......................................................................................... 24.19 eDate Advertising GmbH v X and Olivier Martinez and Robert Martinez v MGN Ltd (C-509/09 and C-161/10) ECLI:EU:C:2011:685 ................................................................................................................................. 21.65 Egeda v Hostelería (C-293/98) ECLI:EU:C:2000:66 .................................................................................. 7.06, 7.65 Elsevier v Cyando (C-683/18), pending ............................................................................................................. 17.257

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TABLE OF CASES EMI-Electrola v Patricia (C-341/87) [1989] ECR 79 ............................................................ 1.08, 2.25, 8.07, 11.62 Établissements Consten S.à.R.L. and Grundig-Verkaufs-GmbH v Commission (56 and 58/64) [1966] ECR 429 ............................................................................................................................................ 3.07, 11.64 European Commission v Council (114/12) EU:C:2014:2151 .................................................................. 26.01, 26.62 Eva Glawischnig-Piesczek v Facebook Ireland Limited (C-18/18) ECLI:EU:C:2019:821 .... 17.260, 17.272, 19.02, 28.07, 28.10, 28.11, 28.13, 28.14, 28.15, 30.08 Falbert and Others (C-255/16) EU:C:2017:983 .................................................................................... 17.29, 17.234 Falco Privatstiftung and Thomas Rabitsch v Gisela Weller-Lindhorst (C-533/07) [2009] ECR I-03327 ......... 3.08 FDV (C-61/97) [1998] ECR I-5171 ........................................................................................................ 11.56, 15.37 Fixtures Marketing Ltd v AB Svenska Spel (C-338/02) [2004] ECR I-10549 ....................... 9.37, 9.38, 9.42, 9.43 Fixtures Marketing Ltd v Organismos Prognostikon Agonon Podosfairou (OPAP) (C-444/02) [2004] ECR I-10365 ................................................................................................................................................. 9.37, 9.38 Fixtures Marketing Ltd v Oy Veikkaus AB (C-46/02) [2004] ECR I-10497 (Veikkaus) ......................... 9.37, 9.38 Football Association Premier League Ltd and Others v QC Leisure and Others and Karen Murphy v Media Protection Services Ltd (C-403/08 and C-429/08) [2011] ECR I-09083 ............ 3.10, 6.08, 7.14, 7.22, 8.59, 11.13, 11.18, 11.20, 11.24, 11.25, 11.35, 11.58, 11.81, 11.84, 11.87, 11.92, 13.77, 15.37, 16.62, 16.142, 17.75, 17.79, 17.81, 17.103, 20.18, 29.14 Football Dataco Ltd v Sportradar GmbH (C-173/11) [2013] 1 CMLR (29) 903 ........................ 9.48, 11.26, 17.68 Football Dataco Ltd v Yahoo! UK Ltd (C-604/10) ECLI:EU:C:2012:115 .......... 8.59, 9.13, 9.14, 9.16, 9.75, 9.76, 29.02 Foreningen af danske Videogramdistributører, acting for Egmont Film A/S, Metronome in the person of Hans Kristian Pedersen and Others v Laserdisken (C-61/97) [1998] ECR I-5187 ................................. 6.22, 11.36 Föreningen Svenska Tonsättares Internationella Musikbyrå u.p.a. (STIM) v SAMI (C-753/18) see STIM v SAMI France Télécom SA v Commission (C-202/07P) [2009] ECR I-2369; [2007] CMLR 25 ....................... 4.14, 4.65 François Lucazeau and others v Société des Auteurs, Compositeurs et Editeurs de Musique (SACEM) and others (110/88, 241/88 and 242/88) [1989] ECR 2811 ..................................................................... 14.57 Freistaat Bayern v Verlag Esterbauer GmbH (C-490/14) [2015] Bus LR 1428 .................................................. 9.03 Frisdranken Industrie Winters BV v Red Bull (C-119/10) ECLI:EU:C:2011:837 .............................. 12.144, 21.57 Fundacion Gala-Salvador Dalí v VEGAP/ADAGP (C-518/08) [2010] ECR I-3091 ...................................... 10.46 Funke Medien (C-469/17) ECLI:EU:C:2019:623 ......... 11.94, 11.95, 17.219, 17.265, 17.266, 28.27, 28.36, 28.39, 28.40, 28.41, 28.42, 28.43 Gasser (Erich) GmbH v MISAT Srl (C-116/02) [2003] ECR I-14693 ........................................................... 24.26 Generics (UK) Ltd v Competition and Markets Authority (C-307/18) EU:C:2020:52 ...................................... 4.76 Germany v Commission [1963] ECR 63 ............................................................................................................ 20.03 Gesellschaft für Antriebstechnik mbH & Co KG (GAT) v Lamellen und Kupplungsbau Beteiligungs KG (LUK) (C-4/03) [2006] ECR I-6509 .......................... 24.18, 24.22, 24.23, 24.25, 24.26, 24.27, 24.28, 24.30 Gesellschaft für Antriebstechnik GmbH & Co KG v Lamellen und Kupplungsbau Beteiligungs KG (GAT/LuK) (C-315/01) ECLI:EU:C:2003:360 ............................................................................................................. 21.66 Glaxosmithkline, Laboratoires Glaxosmithkline v Jean-Pierre Rouard (C-462/06) ........................................... 24.10 Google France v Louis Vuitton (C-238/08) [2010] EUECJ ............................................................................ 11.185 Google France and Google (C-236/08 to C-238/08) ECLI:EU:C:2010:159 ............................ 12.144, 21.57, 24.85 Google LLC, successor in law to Google Inc v Commission nationale de l'informatique et des libertés (CNIL) (C-507/17) ECLI:EU:C:2019:772 .................................................................................................. 28.07, 28.15 GS Media BV v Sanoma Media Netherlands BV, Playboy Enterprises International Inc, Britt Geertruida Dekker (C-160/15) ECLI:EU:C:2016:644 ........................................................................ 11.33, 17.252, 28.24 GVL v Commission (C-7/82) [1983] ECR 00483 ........................................................................... 2.25, 4.30, 14.29 Haegemann v Belgian State (181/73) [1974] ECR 449 ...................................................................................... 11.79 Hag GF (C-10/89) [1990] ECR I-3711 ............................................................................................................. 15.37 Hejduk (Pez) v EnergieAgentur.NRW GmbH (C-441/13) ECLI:EU:C:2015:28 ............................................ 24.06 Hermès International v FHT Marketing Choice (C-53/96) [1998] ECR I-3603 ............................................. 11.78 Hewlett-Packard Belgium SPRL v Reprobel SCRL (C-572/13) [2015] ECLI:EU:C:2015:750 .......... 6.69, 11.115, 11.121, 16.76, 17.138, 17.226, 17.245, 28.42 Hi Hotel HCF SARL v Uwe Spoering (C-387/12) ECLI:EU:C:2014:215 ........................................... 24.04, 24.05 Hilti v Commission (C-53/92 P) [1994] ECR I-667 ...................................................... 4.10, 4.11, 4.26, 4.26, 4.39 Hoffmann-La Roche AG v Commission (85/76) [1979] ECR 461; [1979] 3 CMLR 211 .... 4.07, 4.13, 4.14, 4.22 Hofner & Elser v Macrotron GmbH (C-41/90) [1991] ECR I-1979 ................................................................. 4.06 Holger Forstmann Transporte (C-152/13) ECLI:EU:C:2014:2184 ................................................................... 12.45 Hugin Kassaregister AB and Hugin Cash Registers Ltd v Commission (22/78) [1979] ECR 1869; [1979] 3 CMLR 345 .......................................................................................................................................... 4.05, 4.13 Huawei Technologies Co Ltd v ZTE Corp (C-170/13) EU:C:2015:477, [2015] Bus LR 1261 ..... 4.02, 4.29, 4.76

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TABLE OF CASES Hydrotherm Gerätebau GmbH v Compact del Dott. Ing. Mario Andreoli (170/83) [1984] ECR 2999 ......... 11.64 IMS Health GmbH & Co OHG v NDC Health GmbH & Co KG (C-418/01) [2004] ECR I-5039; [2004] 4 CMLR 28 .................................................................................................. 4.33, 4.51-4.55, 4.59, 4.64 Ince (C-336/14) EU:C:2016:72 .............................................................................................................. 17.29, 17.234 Infopaq International v Danske Dagblades Forening (C-5/08) ECLI:EU:C:2009:465 ........... 1.12, 1.13, 1.15, 5.36, 5.65, 5.79, 5.98, 9.13, 9.21, 9.26, 11.10, 11.34, 11.81, 11.84, 11.87, 13.77, 17.42, 17.75, 17.76, 17.174, 17.219, 17.220, 17.237, 17.238, 29.01, 29.24 Infopaq International A/S v Danske Dagblades Forening (Order of the Court) Infopaq II (C-302/10) ....... 11.84, 11.87, 13.77, 17.75, 17.78, 17.79, 17.81 Innoweb BV v Wegener ICT Media BV, Wegener Mediaventions BV (C-202/12) ECLI:EU:C:2013:850 ..... 9.48 Irina Nikolajeva v Multi Protect OÜ (C-280/15) ECLI:EU:C:2016:467 ........................................................ 12.192 Istituto Chemioterapico Italiano and Commercial Solvents v Commission (6/73 and 7/73) [1974] ECR 223 ............................................................................................................................ 4.05, 4.30, 4.36, 4.64 IT Development SAS v Free Mobile SAS (C-666/18) EU:C:2019:1099 ........ 5.66, 5.96, 5.97, 12.10, 12.29, 21.75 ITV Broadcasting v TVCatchup (C-607/11) ECLI:EU:C:2013:147 ............. 7.14, 7.16, 11.18, 11.20, 11.35, 11.87 Jean-Claude Arblade & Fils SARL (C-369/96) and Bernard Leloup, Serge Leloup, Sofrage SARL (C-376/96) [1999] ECR I-8453 ................................................................................................................. 24.47 Johan Deckmyn, Vrijheidsfonds VZW v Helena Vandersteen and Others (C-201/13) ECLI:EU:C:2014:2132 .................................................................................................................... 11.96, 28.24 Kanal 5 Ltd, TV 4 AB v STIM (C-52/07) [2008] ECR I-09275 ..................................................................... 14.56 Kenny Roland Lyckeskog (C-99/00) ECLI:EU:C:2002:329 .............................................................................. 21.75 Keurkoop v Nancy Kean Gifts (C-144/81) [1982] ECR 2853 ........................................................................... 11.62 Koninklijke Philips Electronics NV v Lucheng Meijing Industrial Company Ltd and Ors and Nokia Corporation v HM Commissioners of Revenue and Customs (C-446/09 and C-495/09) ECLI:EU:C:2011:796 .................................................................................................................... 21.78, 21.292 Konkurrensverket v TeliaSonera Sverige AB (C-52/09) [2011] ECR I-00527 .................................................... 4.53 L’Oréal v eBay (C-324/09) [2011] ECR I-6011, [2011] ETMR 52 .... 9.49, 11.50, 11.172, 11.185, 12.18, 12.133, 12.144, 12.145, 12.171, 12.181, 21.49, 21.57, 21.148, 21.149, 21.160 Lagardère Active Broadcast v SPRE and Others (C-192/04) ............................. 6.94, 7.09, 7.10, 7.12, 11.35, 24.97 Land de Sarre v Ministre de l’Industrie (187/87) ECLI:EU:C:1988:439 ........................................................... 12.45 Land Hessen v Ricordi (C-360/00) [2002] ECR I-05089 .......................................................................... 1.11, 2.26 Land Nordrhein-Westfalen v Dirk Renckhoff (C-161/17) ECLI:EU:C:2018:634 ...................... 7.10, 8.59, 17.252, 28.37, 28.38 Laserdisken ApS v Kulturministeriet (C-479/04) [2006] ECR I-08089 ............... 3.16, 5.77, 11.66, 11.105, 21.170 Lassal (C-162/09) ECLI:EU:C:2010:592 ............................................................................................................ 12.45 Levola Hengelo BV v Smilde Foods BV (C-310/17) ECLI:EU:C:2018:899 ............................................. 2.02, 9.13 Liffers v Producciones Mandarina SL, and Mediaset España Comunicación SA (C-99/15) ECLI:EU:C:2016:173 ................................................................................................................................. 21.51 Lippens and Others (C-170/11) ECLI:EU:C:2012:540 ................................................................................... 12.104 LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH (C-557/07) [2009] ECR I-01227. ........ 11.84, 11.191, 11.194, 12.26, 12.122, 12.127, 12.144, 21.57, 21.166 McFadden (Tobias) v Sony Music Entertainment Germany GmbH (C-484/14) ECLI:EU:C:2016:689 ..... 11.186, 12.26, 12.177, 12.179, 12.218, 21.142, 21.173, 28.24 Magill see Radio Telefis Eireann v Commission of the European Communities (C-241/91P) Makro Zelfbedieningsgroothandel and Others (C-324/08) [2009] ECR I-10019 ............................................. 11.50 Martin Blomqvist v Rolex SA, Manufacture des Montres Rolex SA (C-98/13) [2014] ETMR 25 ................. 11.56 Martin Luksan v Petrus van der Let (C-277/10) [2012] OJ C80/12 ...... 6.54, 7.12, 8.27, 8.28, 8.31, 11.48, 11.119 Mediakabel BV v Commissariaat voor de Media (C-89/04) ECLI:EU:C:2005:348 ....................... 7.12, 7.16, 11.35 Melzer v MF Global UK Ltd (C-228/11) ECLI:EU:C:2013:305 .......................................................... 24.04, 24.05 Metronome Musik (C-200/96) [1998] ECR I-1953 .................................................... 5.72, 6.22, 6.99, 6.100, 11.56 Ministère public v Jean-Louis Tournier (395/87) [1989] ECR 02521 ........... 3.09, 6.17, 11.36, 14.23, 14.51, 14.57 Montis Design BV v Goossens Meubelen BV (C-169/15) [2016] ECLI:EU:C:2016:790 ............... 8.24, 8.72, 8.73 Mund and Fester (C-398/92) [1994] ECR I-00467 ............................................................................................. 2.27 Musik-Vertrieb Membran v GEMA (C-55/80 and 57/80) [1981] ECR 147 ...................... 1.05, 3.07, 11.64, 15.37 NDC Health v IMS Health and Commission (C-481/01 P(R)) [2002] ECR I-3401 ........................................ 4.51 Nederlands Uitgeversverbond, Groep Algemene Uitgevers v Tom Kabinet Internet BV, Tom Kabinet Holding BV, Tom Kabinet Uitgeverij BV (C-263/18) ECLI:EU:C:2019:1111 .......................................... 6.100, 11.39 New Wave as v Alltoys spol s.r.o. (C-427/15) ECLI:EU:C:2017:18 ....................................... 12.106, 12.109, 21.56 Nilsson and others (C-162/97) [1998] ECR I-7477 ........................................................................................... 11.86

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TABLE OF CASES Nintendo Co Ltd v BigBen Interactive GmbH and BigBen Interactive SA (C-24/16 and C-25/16) ECLI:EU:C:2017:724 ................................................................................................................................. 24.92 Nintendo Co Ltd v PC Box Srl and 9Net Srl (C-355/12) EU:C:2014:25 ............ 5.05, 5.32, 11.109, 11.129, 13.15 NUV v Tom Kabinet (C-263/18) EU:C:2019:1111 ............................................................................................. 3.13 OPAP see Fixtures Marketing Ltd v Organismos Prognostikon Agonon Podosfairou (OPAP) Orange Polska (C-123/16P) ECLI:EU:C:2018:590 .............................................................................................. 4.30 OSA – Ochranný svaz autorský pro práva k dílům hudebním o.s. v Lécˇebné lázneˇ Mariánské Lázneˇ a.s. (C-351/12) [2014] EUECJ ........................................................................................................... 11.20, 11.118 Organismos Sillogikis Diacheirisis Dimiourgon Theatrikon kai Optikoakoustikon Ergon v Divani Akropolis Anonimi Xenodocheiaki kai Touristiki Etaireai (C-136/09) [2010] ECR I-37 ....................................... 11.21 Oscar Bronner GmbH & Co KG v Mediaprint Zeitungs-und Zeitschriftenverlag GmbH & Co KG (C-7/97) [1998] ECR I-7791 ................................................... 4.02, 4.19, 4.32, 4.35, 4.36, 4.46, 4.52, 4.53, 4.55, 4.59 Padawan v SGAE (C-467/08) ECLI:EU:C:2010:620 ................................ 1.12, 1.13, 11.96, 11.115, 11.118, 16.76 Painer (Eva-Maria) v Standard Verlags GmbH et al. (C-145/10) ECLI:EU:C:2013:138 ...... 1.15, 5.37, 8.59, 9.13, 11.106, 16.62, 16.95, 17.219, 24.12, 28.24, 28.41, 29.02, 29.24 Pammer and Hotel Alpenhof (C-585/08 and C-144/09) ECLI:EU:C:2010:740 .............................................. 21.65 Parfums Christian Dior SA v Evora BV (C-337/95) [1997] ECR I-6013 ............................................... 3.08, 28.44 Parke Davis v Proebel (24/67) [1968] ECR 55; [1968] CMLR 47 ..................................................................... 4.13 Pastoors and Trans-Cap (C-29/95) [1997] ECR I-00285 .................................................................................... 2.27 Patrick Breyer v Bundesrepublik Deutschland (C-582/14) ECLI:EU:C:2016:779 ............................................ 15.30 Peak Holding AB v Axolin-Elinor AB (C-16/03) [2004] ECR I-11313 ........................................ 3.07, 9.49, 11.50 Peek & Cloppenburg v Cassina (C-456/06) [2008] ECR I-2731 ......... 3.08, 5.72, 5.84, 11.48, 11.49, 11.56, 11.62 Pelham GmbH, Moses Pelham, Martin Haas v Ralf Hütter, Florian Schneider-Esleben (aka Kraftwerk) (C-476/17) [2019] ECLI:EU:C:2019:624 ................................................................ 6.102, 11.13, 11.94, 11.95 Peter Pickney v KDG Mediatech AG (C-170/12) ECLI:EU:C:2013:635 ................................ 17.188, 21.65, 24.05 Phil Collins v Imtrat (C-92/92 and 326/92) [1993] ECR 1–05145 ... 1.05, 1.11, 2.02, 2.21, 2.23, 2.25, 2.26, 2.30, 8.71, 10.07, 10.13, 10.59, 14.29, 15.37 Polydor Ltd and RSO Records Inc v Harlequin Record Shops Ltd and Simons Records Ltd (270/80) [1982] ECR 329 ..................................................................................................................................................... 11.67 PPL (Phonographic Performance (Ireland) Ltd) v Ireland (C-162/10) [2012] OJ C133/12 ........... 6.89, 6.90, 6.95, 6.104, 7.10, 11.21, 11.24, 11.35 Productores de Música de España (Promusicae) v Telefónica de España SAU (C-275/06) [2008] ECR I-271 .... 11.87, 11.191, 11.194, 12.18, 12.26, 12.114, 12.122, 12.127, 16.142, 21.158, 21.165, 21.166, 28.39 Public Relations Consultants Association Ltd v Newspaper Licensing Agency Ltd and Others (C-360/13) ECLI:EU:C:2014:1195 ..................................................................... 11.10, 11.84, 17.52, 17.75, 17.76, 17.236 Radio Telefis Eireann (RTE) v Commission (Magill) (C-241/91P) [1995] ECR I-743; [1995] 4 CMLR 718 ............................................................................... 4.02, 4.31, 4.32, 4.36, 4.44-4.49, 4.52, 4.53, 4.55, 4.59 Ranks (Aleksandrs) and Vasiļevic (C-166/15) EU:C:2016:762 ......................... 5.76, 5.83, 5.85, 5.111, 5.136, 11.56 Realchemie Nederland BV v Bayer CropScience AG (C-406/09) ECLI:EU:C:2011:668 ...... 12.208, 12.213, 21.52 Reha Training (C-117/15) ECLI:EU:C:2016:309 ............................................................... 6.87, 6.89, 11.20, 17.252 Republic of Poland v European Parliament and Council (C-401/19), pending .................................. 17.260, 17.261 Ricordi see Land Hessen v Ricordi Roche Nederland BV v Frederick Primus, Milton Goldenberg (Roche/Primus) (C-539/03) ECLI:EU:C:2006:458 .................................................................................... 21.66, 24.08, 24.09, 24.10, 24.12 Ryanair Ltd v PR Aviation BV (C-30/14) EU:C:2015:10 ........................................................... 9.77, 17.70, 17.108 SA Compagnie générale pour la diffusion de la télévision, Coditel, and Others v Ciné Vog Films and Others (62/79) see Coditel St Paul Diary v Unibel (C-104/03) ECLI:EU:C:2005:255 ............................................................................... 12.104 SAS Institute v World Programming Ltd (C-406/10) EU:C:2012:259 ....... 5.12, 5.14, 5.20, 5.22, 5.24, 5.29, 5.29, 5.38, 5.64, 5.101, 5.105, 5.113, 5.114, 5.117, 5.120, 5.130, 5.147, 9.13, 11.13 SAT Fluggesellschaft v Eurocontrol (C-364/92) [1994] ECR I-43; [1994] 5 CMLR 208 ................................ 4.06 SBS Belgium (C-325/14) ECLI:EU:2015:764 ........................................................................................... 7.10, 20.26 Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) (C-70/10) [2011] ECR I-11959 ........................................ 11.176, 12.18, 12.26, 12.122, 12.133, 12.144, 12.181, 17.266, 21.49, 21.57, 21.158, 21.160, 21.162, 21.169, 28.24 Schawe v Saechsiches Druck- und Verlagshaus (C-215/07) [2007] OJ C-155/12 ............................................... 9.34 Schieving-Nijstad (C-89/99) ECLI:EU:C:2001:438 ......................................................................................... 12.101 Sebago Inc and Ancienne Maison Dubois & Fils SA v G-B Unic SA (C-173/98) [1999] ECR I-04103 ....... 5.81, 11.66 SENA (C-245/00) [2003] ECR I-1251 ........................................ 1.13, 6.87, 6.92, 6.93, 6.96, 11.34, 11.96, 17.174

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TABLE OF CASES SETTG (C-398/95) [1997] ECR I-3091 ............................................................................................................ 15.37 SGAE (C-306/05) ECLI:EU:C:2006:764 .............................. 1.12, 7.06, 7.16, 11.34, 11.96, 16.142, 17.98, 17.174 Shevill and Others v Presse Alliance SA (C-68/93) [1995] ECR I-415 ................................................. 24.02, 24.05 Silhouette International Schmied GmbH & Co. KG v Hartlauer Handelsgesellschaft mbH (C-355/96) [1998] ECR I-04799 .............................................................................................................................................. 11.67 Simiramida-04 EOOD v Diageo Brands BV (C-681/13) ECLI:EU:C:2015:471 ................................ 12.208, 21.52 Sirena (C-40/70) [1971] ECR 69 ........................................................................................................................ 11.64 Sociedad General de Autores y Editores de España (SGAE) v Rafael Hoteles SA (C-306/05) [2006] ECR I I-11519 ................................................................................................................................ 11.21, 11.35 Società Consortile Fonografici (SCF) v Marco Del Corso (C-135/10) ECLI:EU:C:2012:140 ..... 4.75, 6.98, 11.23, 11.24, 11.35, 17.252 Société de perception et de distribution des droits des artistes-interprètes de la musique et de la danse (Spedidam) and Others v Institut national de l’audiovisuel (C-484/18) ECLI:EU:C:2019:970 ................................ 17.252 Softwarová (C-393/09) [2010] ECR I-13971 ............................. 5.08, 5.12, 5.16, 5.18, 5.19, 5.22, 5.26, 5.27, 5.36, 6.86, 6.87, 6.88, 6.89, 9.13, 11.24 Solvay SA v Honeywell Fluorine Products Europe BV, Honeywell Belgium NV and Honeywell Europe NV (C-616/10) ECLI:EU:C:2012:445 ............................................................................................................. 24.12 Sony Music Entertainment GmbH v Falcon Neue Medien Vertrieb GmbH (C-240/07) [2009] ECR I-00263 ................................................................................................................................................. 8.60, 8.70 Sot Lelos kai Sia EE v GlaxoSmithKline AEVE Farmakeftikon Proionton (C-468/06) [2008] ECR I-07139 .......................................................................................................................................................... 4.30 Soulier (Marc) & Doke (Sara) v Premier Ministre (C-301/15) ECLI:EU:C:2016:878 .... 4.19, 4.77, 13.24, 17.171, 17.252, 28.37 Spiegel Online v Volker Beck (C-516/17) ECLI:EU:C:2019:625 ..... 11.94, 11.95, 11.106, 17.252, 17.265, 17.266, 28.32, 28.36, 28.39, 28.40, 28.41, 28.42, 28.43 SRL CILFIT v Ministero della Sanità (C-283/81) [1982] ECR 3415 .............................................................. 11.96 Stichting Brein v Jack Frederik Wullems (C-527/15) ECLI:EU:C:2017:300 .......................... 11.31, 11.84, 11.186, 17.236, 17.252 Stichting Brein v Ziggo (C-610/15) EU:C:2017:456 .................................................... 11.24, 11.35, 17.236, 17.252 Stichting de Thuiskopie v Opus Supplies Deutschland GmbH and Others (C-462/09) [2011] ECDR 18 ... 11.119 STIM v SAMI (C-753/18) ECLI:EU:C:2020:268. ......................................................................... 1.12, 6.87, 11.24 Stitching de Thuiskopie (C-435/12) ECLI:EU:C:2014:254 ............................................................................... 16.76 Stowarzyszenie ‘Oławska Telewizja Kablowa’ w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie (C-367/15) ECLI:EU:C:2017:36 .......... 12.16, 12.20, 12.196, 12.197, 12.201, 12.203, 12.204, 12.211, 21.51 Svensson (Nils) v Retriever Sverige AB (C-466/12) [2014] EUECJ ..... 11.09, 11.18, 11.31, 11.32, 11.101, 17.236, 28.42 Sweden and Others v API and Commission (C-528/07 P and C-532/07 P) [2010] ECR I-8533 .................. 27.50 Technische Universität Darmstadt (C-117/13) [2014] EUECJ ........................................................................ 11.105 Tetra Pak v Commission (C-333/94) [1996] ECR I-5951 ................................................................................... 4.28 Tiercé Ladbroke (C-300/97P), removed from the register 11 Feb 1999 ............................................ 4.33, 4.50, 4.65 Tod’s SpA (C-28/04) [2005] ECR I-05781 ................................................................................................. 1.11, 2.27 Tom Kabinet (C-263/18) EU:C:2019:1111 ......................................................................................................... 11.48 Tommy Hilfiger Licensing LLC and Others v Delta Center a.s. (C-494/15) ECLI:EU:C:2016:528 .......... 12.144, 12.145, 12.171, 12.181, 21.57 Top Logistics & Van Caem International v Bacardi (C-379/14) ECLI:EU:C:2015:497 ..................... 12.144, 21.57 Gregory Paul Turner v Ismail Grovit (C-159/02) [2004] ECR I-3565 .................................................. 24.26, 24.27 TV 10 SA v Commissariaat voor de Media (C-23/93) [1994] ECR I-4795 ..................................................... 15.06 Uber France (C-320/16) EU:C:2018:221 ............................................................................................... 17.29, 17.234 Union of European Football Associations (UEFA) and British Sky Broadcasting Ltd v Euroview Sport Ltd (C-228/10) ECLI:EU:C:2012:6 ................................................................................................................... 7.12 United Brands v Commission (27/76) [1978] ECR 207 ............................... 4.08, 4.09, 4.13, 4.14, 4.30, 4.36, 4.39 United Pan-Europe Communications Belgium and Others (C-250/06) [2007] ECR I-11135 ........................ 15.37 United Video Properties Inc v Telenet NV (C-57/15) ECLI:EU:C:2016:611 ........ 12.203, 12.210, 12.213, 12.215, 12.217, 21.52 UPC Telekabel Wien (C-314/12) [2014] EUECJ ........................... 11.121, 11.172, 11.193, 12.26, 12.143, 12.145, 12.179, 12.180, 21.57, 21.167- 21.172, 21.173, 12.179, 21.182, 28.24 Uradex SCRL v Union Professionnelle de la Radio et de la Teledistribution (RTD) (C-169/05) ECLI:EU:C:2006:365 ................................................................................................................................... 7.70

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TABLE OF CASES UsedSoft GmbH v Oracle International Corp (C-128/11) ECLI:EU:C:2012:407 ........ 1.13, 3.12, 3.13, 3.14, 5.04, 5.05, 5.17, 5.72, 5.79, 5.80, 5.82, 5.87, 5.88, 5.91, 5.102, 5.106, 6.57, 9.25, 9.58, 9.59, 11.34, 11.37, 11.38, 11.42, 11.48, 11.56, 11.58, 17.98, 17.174, 21.35 UTECA (C-222/07) [2009] ECR I-1407 ........................................................................................................... 15.37 Van Binsbergen v Bestuur van de Bedrijfsvereniging (33/74) [1974] ECR 1299 .............................................. 15.06 van Duyn (Yvonne) v Home Office (41/74) [1974] ECR 1337 ............................................................ 5.154, 16.141 VCAST Ltd v RTI SpA (C-265/16) [2017] EUECJ ....................................................................................... 11.119 Vereniging Openbare Bibliotheken v Stichting Leenrecht (C-174/15) [2016] ECR 459 .................................... 6.20 Vereniging van Educatieve en Wetenschappelijke Auteurs (VEWA) v Belgische Staat (C-271/10) [2011] ..... 11.96 Verwertungsgesellschaft Rundfunk (C-641/15) ECLI:EU:C:2017:131 ................................................................ 7.10 VEWA v Belgische Staat (C-271/10) [2011] OJ C252/11 .................................................................................. 6.70 VG Media Gesellschaft zur Verwertung der Urheber- und Leistungsschutzrechte von Medienunternehmen mbH v. Google LLC (C-299/17) Judgment of the Court (Fourth Chamber) of 12 September 2019, ECLI:EU:C:2019:716 ............................................................................................................................... 17.225 VG Wort (C-457/11 to C-460/11) ECLI:EU:C:2013:426 ........................................................ 11.70, 16.76, 17.138 Volk v Vervaecke (5/69) [1969] ECR 295; [1969] CMLR 273 ........................................................................... 4.27 Volvo v Erik Veng (238/87) [1988] ECR 6211 ............................................. 4.04, 4.13, 4.31, 4.32, 4.49, 4.62, 4.65 Warner Brothers v Christiansen (C-158/86) [1988] ECR 2605 ......... 1.05, 1.06, 1.08, 3.09, 6.03, 6.12, 6.21, 6.28, 6.99, 11.36, 11.56 Wintersteiger AG v Products 4U Sondermaschinenbau GmbH (C-523/10), ECLI:EU:C:2012:220 ............... 21.65 Wouters v Algemene Raad van Dederlandsche Orde van Advocaten (C-309/99) [2002] ECR I-1577; [2002] 4 CMLR 913 .................................................................................................................................... 4.06 Yiadom (C-357/98) [2000] ECR I-9265 .................................................................................... 11.34, 17.98, 17.174 YouTube (C-682/18), pending ........................................................................................................................... 17.250 Zino Davidoff and Levi Strauss (C-414/99 to C-416/99) [2001] ECR I-8691 ....................................... 5.81, 11.63 Decision of the CJEU of December 2012 concerning public access to documents held by the Court of Justice of the European Union in the exercise of its administrative functions (2013/C 38/02) .............................. 27.48 Art 1 ................................................................................................................................................................. 27.47 Art 4 ................................................................................................................................................................. 27.48 Art 6 ................................................................................................................................................................. 27.48 Art 9 ................................................................................................................................................................. 27.51 Opinion of the CJEU (Grand Chamber) of 14 February 2017 (C-3/15) ECLI:EU:C:2017:114 .................... 16.31 Opinion 1/17 of Advocate General Bot of 29 January 2019, Request for an opinion by the Kingdom of Belgium ..................................................................................................................................................... 21.227

General Court Bayer v Commission [2000] ECR II-3383 ............................................................................................................ 4.27 Clearstream Banking v Commission (T-301/04) [2009] ECR II-3155; [2009] 5 CMLR 24 ................... 4.02, 4.30 Clipboard formats II/Microsoft (T-411/03) ........................................................................................................... 5.07 Contact Software v European Commission (T-751/15) ECLI:EU:T:2017:602 ................................................... 4.02 European Night Services Ltd (ENS) v Commission (T-374/94, T-375/94, T-384/94 and T-388/940) [1998] ECR II-3141; [1998] 5 CMLR 718 ............................................................................................................ 4.02 Federación Nacional de Empresas de Instrumentación Científica, Médica, Técnica y Dental (FENIN) v Commission (T-319/99) [2003] ECR II-357 .............................................................................................. 4.06 Google v Commission (T-612/17), in progress ............................................................................................ 4.36, 4.79 Hilti v Commission (T-30/89) [1991] ECR II-1439 ................................................................ 4.10, 4.13, 4.26, 4.37 IMPALA (T-464/04) [2006] ECR II 2289 ........................................................................................ 4.03, 4.16, 4.72 IMS Health Inc v Commission (No 1) (T-184/01R) [2001] ECR II-2349; [2002] 4 CMLR 1 ....................... 4.51 Ladbroke Racing v Commission (T-32/93) [1994] ECR II-1015 ........................................................................ 4.33 Microsoft Corp (Computing Technology Industry Association Inc and Others, intervening) v Commission (Software & Information Industry Association and Others, intervening) (T-201/04) [2007] ECR II-3601; [2007] 5 CMLR 11 ................................................... 4.02, 4.28, 4.30, 4.32, 4.34, 4.41, 4.43, 4.56–4.63, 4.64, 4.65, 4.66, 4.74, 4.75, 5.124, 5.146 Orange Polska SA v Commission (T-486/11) EU:T:2015:1002 .......................................................................... 4.30 Software v Commission (T-751/15) ECLI:EU:T:2017:602 ................................................................................. 4.02 Systran SA and Systran Luxembourg SA v European Commission (T-19/07) [2010] ECR II-06083 .... 5.44, 5.98, 12.51

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TABLE OF CASES Tetra Pak v Commission (Tetra Pak II) (T-83/91) [1994] ECR II-755 ............................................................. 4.28 Tiercé Ladbroke v Commission (T-504/93) [1997] ECR II-923 ............................................................... 4.33, 4.50

Commission Decisions B&I Line v Sealink Harbours and Stena Sealink [1992] 5 CMLR 255 .............................................................. 4.02 British Midland/Aer Lingus (Case IV/33544), Comm Dec 92/213/EEC, 1992 OJ (L 96) 34 .......................... 4.02 CISAC (COMP/C2/38.698) Proceeding under Article 81 EC Treaty and Article 53 EEA Agreement (2008) 3435 final, Brussels, 16 July 2008, [2009] 4 CMLR 12 ................................................................. 14.03, 14.21 Continental Can [1972] CMLR D11 .................................................................................................................... 4.11 Cross-border access to pay-TV [2019] 4 CMLR 45 ............................................................................................. 4.48 Daft Punk (COMP/C2/37.219) Banghalter/Homem Christo v SACEM ......................................................... 14.30 ENI (COMP/39.315) [2010] OJ C352/8 September 29, 2010 ......................................................... 4.37, 4.40, 4.50 GEMA I, Comm Dec 71/224/EEC of 2 June 1971 Proceeding under Article 86 of the EEC Treaty (IV/26 760 – GEMA), OJ L 134/15 of 20.6.1971 ([1971] CMLR D35) ................ 4.15, 14.26, 14.29, 14.36 GEMA II (Gesellschaft für musikalische Aufführungs- und mechanische Vervielfältigungsrechte) Comm Dec 72/268, [1972] OJ L 166/22 ........................................................................................................... 14.26, 14.36 Flughafen Frankfurt [1998] OJ L72/30; 4 CMLR 779 ........................................................................................ 4.40 Google Android Commission decision AT.40099 18.7.2018 ....................................................................... 4.28, 4.79 Google Search (Shopping) Case AT.39740 [2018] 4 CMLR 12 ................................................................ 4.36, 4.79 IFPI Simulcasting (COMP/C2/38.014) Comm Dec 2003/300/EC of 8 October 2002 Proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement, OJ L 107/58 of 30.4.2003 ......... 14.21, 14.48, 14.52 IMS 2002/165/EC .................................................................................................................................................. 4.51 Irish Continental Group/CCI Morlaix (Port of Roscoff) [1995] CMLR 77 .............................................. 4.02, 4.06 Italian Flat Glass OJ 1999 L33/44, [1990] 4 CMLR 535 .................................................................................... 4.03 London-European Sabena (Case IV/32.318) Comm Dec 88/589/EEC, 1988 OJ L 317/ 47 ............................ 4.02 Microsoft (COMP/C 3–37.792) Dec of 24 March 2004, case COM (2004) 900 final and publication of an extract in OJ L-32/23, 6 Feb 2007 ....................................................................................................... 4.146 Motorola/Google v Apple, Commission, May 2013 ............................................................................................. 4.29 NDC Health v IMS Health (Interim measures) (COMP D3/38.044) 2002 OJ L 59/18 ................................... 4.51 OLAF Comm Dec 1999/352/EC, ECSC, Euratom of 28 April 1999, as amended [2013] OJ L257/19) .... 21.128 Port of Rødby, Comm Dec 94/119/EC, 1994 OJ (L 055) 52 .............................................................................. 4.02 Rambus (COMP/38.636), 9.12.2009 ..................................................................................................................... 4.29 Reuter/BASF [1976] 2 CMLR D44 ..................................................................................................................... 4.06 Sea Containers v Stena Link, Interim Measures (Case IV/34.689) Comm Dec 94/19/EC, 1994 OJ (L 015) 8 .............................................................................................................................................. 4.02, 4.38 Sealink/Holyhead and IMS .................................................................................................................................... 4.69 Tetra Pak II [1992] 4 CMLR 76 ................................................................................................................. 4.25, 4.37

Council Decisions Council Decision 2014/221/EU of 14 April 2014, relying on the EU exclusive competence to ratify the Treaty, also on behalf of Member States, based on Articles 114 and 207 TFEU .................................... 16.29 Council Decision 2000/278/EC, OJ L89/6, 11.4.2000 ....................................................................................... 26.03 Council Framework Decision 2002/584/JHA of 13 June 2002 on the European arrest warrant and the surrender procedures between Member States [2002] OJ L190/1 ............................................................ 21.95 Council Framework Decision 2009/299/JHA of 26 February 2009 amending Framework Decisions 2002/584/JHA, 2005/214/JHA, 2006/783/JHA, 2008/909/JHA and 2008/947/JHA ............................. 21.95 Decision 2002/187/JHA setting up Eurojust ..................................................................................................... 21.127

EFTA Court L’Oréal Norge AS v Per Aarskog AS and L’Oréal SA v Smart Club AS (E-9/07 and E-10/07) [2008] ETMR 60 ................................................................................................................................................... 11.67 Norwegian Government, represented by the Royal Ministry of Social Affairs and Health v Astra Norge AS (E-I/98) [1998] EFTA 140 .......................................................................................................................... 3.08

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TABLE OF CASES

EPO Technical Board of Appeal IBM, Case T117/97 ............................................................................................................................................. 5.145

European Court of Human Rights Akdeniz v Turkey, App No 20877/10 ............................................................................................................... 21.181 Anheuser-Busch Inc v Portugal, App No 73049/01 .......................................................................................... 21.183 Ashby Donald and others v France, App No 36769/08 ............... 11.89, 11.90, 11.91, 21.183, 21.184, 28.23, 28.25 Association Ekin v France, App No 39288/98, ................................................................................................. 21.180 Axel Springer Verlag AG v Germany (Grand Chamber) 7 February 2012 ...................................................... 21.183 Cengiz and Others v Turkey, App Nos 48226/10 and 14027/11 ..................................................................... 21.181 James v UK (1986) 8 EHRR 123 ...................................................................................................................... 11.118 K U v Finland, App No 2872/02 ....................................................................................................................... 21.177 Melnychuk v Ukraine, App No 28743/03 ......................................................................................................... 21.183 Mouvement Raëlien Suisse v Switzerland, App No 16354/06 (13 July 2012) .................................... 21.176, 21.183 Neij (Fredrik) and Peter Sunde Kolmisoppi (The Pirate Bay) v Sweden, App No 40397/12 ... 11.89, 11.194, 28.25 Observer and The Guardian v UK, App No 13585/88 ..................................................................................... 21.183 Pravoye Delo Editorial Team and Shtekel v Ukraine, App No 33014/05 ........................................................ 21.179 RTBF v Belgium, App No 50084/06 ................................................................................................................ 21.183 Times Newspapers Ltd v UK (Nos 1 and 2), App Nos 3002/03 and 23676/03 .............................................. 21.178 Ürper and Others v Turkey, App Nos 14526/07, 14747/07, 15022/07, 15737/07, 36137/07, 47245/07, and 50371/07 .................................................................................................................................................... 21.182 Yıldırım v Turkey, 18 December 2012, App No 3111/1 ........................................... 21.170, 21.180, 21.181, 21.182

WTO Dispute Settlement Panel China – Measures Affecting the Protection and Enforcement of Intellectual Property Rights, WT/DS362/R, 09/0240, 26/01/2009 ................................................................................................................................. 21.243 Saudi Arabia – Measures concerning the protection of intellectual property rights, WTO DS/567 .............. 21.200, 21.264 US v China, China – Measures Affecting the Protection and Enforcement of Intellectual Property Rights, WT/DS362/R,09/0240, 26.01.2009 .............................................................................................. 21.90, 21.241 United States – Section 110(5) of the US Copyright Act (United States – Section 110(5)) WT/DS160/R) (Irish Music) ................................................................................................................................. 21.200, 21.264

NATIONAL CASES Austria Adolf Loos-Werke II, judgment of 28 September 1993, [1994] GRUR Int 638 .............................................. 24.81 Attco, judgment of 28 July 1983, [1984] GRUR Int 453 ................................................................................... 24.81 Hotel-Video, judgment of 17 June 1986, [1986] GRUR Int 728 ...................................................................... 24.81 Meteodata v Bernegger Bau, Supreme Ct, 17 December 2002 ........................................................................... 11.09 Sacher Hotel, judgment of 14 January 1986, [1986] GRUR Int 735 ................................................................. 24.81 Sachverständingenprüfung, judgment of 18 September 1990, [1991] GRUR Int 650 ....................................... 24.81 Übungsprogramm, Supreme Ct, OGH 4 Ob 65/92, MR 1992, 244 ................................................................... 5.53

Belgium Belgian Association of Newspaper Editors v Google (5 May 2011) ........................................................ 11.09, 11.13 Dekimo, Supreme Court, 3 June 2010, R.D.T.I. 2011, 89 ................................................................................... 5.53 Epic Medical Equipment Services and Hospitera v Delaware Nellcor Puritain Bennet, CFI Brussels, 22 September 2000, [2000] Ing. Cons. 292 ............................................................................................... 24.26 Roche v Wellcome Foundation Ltd, CA Brussels, 20 February 2001, [2001] IRDI 169 .................................. 24.26 Telenet, case No P.13.0550.N/1, Supreme Court, 22 October 2013 ................................................................ 21.162

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TABLE OF CASES X v Universitair Medisch Centrum Utrecht and others, 1 October 2010, Supreme Court ................... 24.17, 24.34 Hof van Cassatie/Cour de Cassation, 30 September 2016 .................................................................................. 20.26

Canada Alberta (Education) v Canadian Copyright Licensing Agency (Access Copyright), 2012 CSC 37, 2 RCS 345 ............................................................................................................................................................... 11.69 CCH Canadienne Limitée v Barreau du Haut-Canada Supreme Court, 4 March 2004, (2004 CSC 13) ....... 11.69 Société canadienne des auteurs, compositeurs et éditeurs de musique v Bell Canada, 12 July 2012, 2012 CSC 36, 2 RCS 3326 ................................................................................................................................. 11.69

Denmark Home v Ofir, Maritime and Commercial Court, Copenhagen, 24 February 2006 ............................................ 11.09 Newspaper Publishers’ Association v Newsbooster.com ApS, 7 May 2002, Bailiff’s Court (World eBusiness Law Report, 12 May 2003). ....................................................................................................................... 11.09 Western High Court, 20 April 2001 .................................................................................................................... 11.30

Finland Adobe Systems Inc v A Software Distributor, Supreme Ct, 3 October 2003, [2004] ECDR (30) 303 ........... 5.141

France AMC Promotion v CD Publishers Construct Data Verlag GmbH, T. Com. Paris, 16 February 2001 ............. 9.36 Anne Bragance v Olivier Orban and Michel de Grèce, 1 February 1989, CA Paris, (1989) 142 RIDA 301 ................................................................................................................................................... 24.37 Antonio Martinelli and Roberto Meazza v Editions Gallimard and Sté APA, 2 April 2003 Fourth Chamber CA Paris, (2003) 198 RIDA 413 .................................................................................... 24.81, 24.89 APC v Auchan Telecom, TGI Paris, 28 November 2013, ..................................................... 21.169, 21.171, 21.172 Claude Bolling, 22 March 1993, TGI Paris (1993) 157 RIDA 286 .................................................................. 24.37 Credinfor v Artprice.com, CA Paris, 18 June 2003, Jurisdata, n. 223155 ............................................................ 9.54 Didier Barbelivien and Gilbert Montagné v Sté AGAPES and others, 3 September 1997, Third chamber TGI Paris, (1998) 175 RIDA 343 ............................................................................................................. 24.89 DM v APP, Microsoft, Sacem and others, Paris CA, Pol 5, Ch 13, 7 June 2017 .......................................... 11.190 Furtwängler, Cour de cassation, Civ. 1, 4 January 1964, Bull. Civ. 1964, n° 17 .................................................. 6.79 Havas Numerique SNC and Cadres On Line S.A. v Keljob, 26 December 2000, Paris Commercial Court, on Appeal, later by the Paris Civil Court .................................................................................................. 11.09 Hugo v Plon SA, Cass., 1e civ., Jan. 30 2007, (2007) 38 IIC 736, 738 ............................................................. 28.21 Jean Lamore v Universal City Studios and others, Cour de Cassation (first civil chamber) 30 January 2007, (2007) 212 RIDA 261 ................................................................................................................................ 24.84 Korda v Onion/The Onion, Cour de Cassation, Cass. 1re Civ., 22/01/2014, case 11-26822 ECLI:FR:CCASS: 2014:C100060 ............................................................................................................. 24.05 Lancôme, Supreme Court (Cass. Comm.), 13 December 2013, n. 11-19872 ...................................................... 2.02 Lectiel v France Télécom (Cass. Chambre commerciale, financière et économique), 23 March 2010, (2010) 225 Revue Internationale du Droit d’Auteur 373 ........................................................................................ 9.39 Précom, Ouest France Multimedia v Direct Annonces, Court of Cassation (Cass.), 1st civ., 5 March 2009 ....................................................................................................................................... 9.39, 9.77 PR Line v Newsinvest, CA Versailles, 11 April 2002 [2002] CCE, July/August 2002, 20–22 .......................... 9.58 Samuel v BBC, Cass. 1re Civ., 22/01/2014, case 11-24019, ECLI:FR:CCASS:2014:C100039 ....................... 24.06 Sisro v Ampersand Software BV, Cour de Cassation 5 March 2002, Cass., 1ère civ, [2002] JCP II 10082 .... 24.81 Soc. Europe 1 Communication v SPRE, 4th Chamber A, CA Paris 3 October 2001, [2002] RCDIP 315 .... 24.97 Tiscali Media/Dargaud Lombard, Lucky Comics (Cour d’appel de Paris 4ème chambre, section A Arrêt, 07.06.2006) ................................................................................................................................................ 11.186 Cour de cassation, Civ. 1, 22 March 1988 (2 decisions: Bull. Civ. 88, p. 56; 89, p. 57 (public performing of recordings in discotheques) ........................................................................................................................... 6.17 Conseil Constitutionnel, 27 July 2006, Recital 13, JO 3 August 2006, 11541ff .................................................. 2.27 Court of Appeal of Bastia (24.09.2008) ............................................................................................................. 11.185

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TABLE OF CASES Constitutional Court, 10 June 2009 (Décision n° 2009-580 DC) Restrictions to internet access ................... 21.247 Cass. Com. 20 October 2011, RTD com. 2011, 760 .......................................................................................... 5.147 Décision no 2012–276 QPC du 28 septembre 2012, Constitutional court ........................................................ 10.47 First Instance Criminal Court of Paris, 2 April 2015 ........................................................................................ 11.190 Cass., Bull. 1e civ., May 15, 2015, Bull. civ. I, No. 13-2739 ............................................................................. 28.22 TGI Paris, Mar. 9, 2017, No. 15/01086 .............................................................................................................. 28.23 Cour de Cassation, Cass. 1ère civ. 11 mai 2017, n°15-29.374, ECLI:FR:CCASS:2017:C100563 ................. 17.219 Court of Appeal of Versailles, March 16, 2018, No. 15/06029 .......................................................................... 28.22 Cass. Crim, 20th June 2018, n° 17-86402 ........................................................................................................... 28.22 Cour de Cassation in case n°10-15.890 ................................................................................................................ 24.05 Decision No 1009/2020 of the Conseil d’Etat, EYED ....................................................................................... 14.45 Competition Authority, Décision n°20-MC-01 du 9 avril 2020 relative à des demandes de mesures conservatoires présentées par le Syndicat des éditeurs de la presse magazine, l'Alliance de la pressed'information générale e.a.et l’Agence France-Presse ..................................................................... 17.228

Germany Bob Dylan, Constitutional Court, GRUR 1990, 438ff ......................................................................................... 2.12 Database Rights, re Case I ZR 159/10, 22 June 2011 [2012] ECC 20 ...................................................... 9.46, 9.47 DNPA v Google (November 2008) ..................................................................................................................... 11.09 Elektronischer Zolltariff, 30 April 2009 (2009) GRUR 852 ................................................................................. 9.41 EMI Electrola, Landgericht Hamburg ................................................................................................................... 8.07 Google Image search ........................................................................................................................................... 11.102 Hit Bilanz case, 21 July 2005, I ZR 290/02 .......................................................................................................... 9.03 Joseph Beuys case BGH [1994] NJW 2888 ........................................................................................................ 10.10 Kettenbandförderer III, 1 February 1994, LG Düsseldorf 4 O 193/87 .............................................................. 24.85 Leistungsschutzurteile, BGH 31 May 1960, BGHZ 33, 1, BGHZ 33, 20, BGHZ 33, 38, BGHZ 33, 48 ...... 6.79 Man spricht deutsch, Decision 13 October 2004, case I ZR 49/03 [2005] GRUR 48 ....................................... 7.60 Marktstudien (Market Surveys), BGH 21 April 2005, Case I ZR 1/02 [2005] GRUR 940, [2006] IIC 489 ....................................................................................................................................... 9.40, 9.45, 9.49 Museumsfotos, Case I ZR 104/17, BGH, 20 December 2018 ......................................................................... 17.218 Musical Hits Database (Hit Bilanz), re Case I ZR 290/02, 21 July 2005 ......................................... 9.45, 9.46, 9.81 Parfummarken Case I ZR 164/16, 9th November 2017, Bundesgerichtshof ..................................................... 24.92 OEM-Version software, 6 July 2000, I ZR 244/97 (2001) GRUR 153 ................................................... 5.86, 11.65 Reinigungmittel für Kunststoffverarbeitungsmaschinen, 16 January 1996, LG Düsseldorf [1996] Entsch. LG Düss. 1 ................................................................................................................................................. 24.85 Rolling Stones, BGH, April 21, 1994 ................................................................................................................... 2.25 Saechsiger Ausschreibungsdiesnt, 28 September 2006 [2007] GRUR 500; [2007] GRUR Int. 532 .................. 9.34 Sender Fellsberg, BGH 7 November 2002, [2003] GRUR 328 ......................................................................... 24.97 Sonnenblende II, 22 September 1998, LG Düsseldorf [1998] Entsch. LG Düss. 75 ....................................... 24.85 Telemedicus, OLG Stuttgart 21 January 2008, Az. 2 WS 328/07; 2 Ws 328/2007 ......................................... 11.25 Verlagsgruppe Handelsblatt GmbH v Paperboy, Bundesgerichtshof No 1 ZR 259/00, 17 July 2003, [2005] ECDR 7 ........................................................................................................................................... 11.09, 11.30 Vorschaubilder I, BGH, I ZR 69/08, 29 April 2010 ........................................................................................ 11.100 Vorschaubilder II, BGH, I ZR 140/10, 19 October 2011. ............................................................................... 11.100 Wagenfeld-Leuchte decision of the Bundesgerichtshof of 15 February 2007 (1 ZR 114/04) [2007] GRUR 871 ............................................................................................................................................................... 24.83 VG Wort, Az.: I ZR 198/13, decision, 4/21/16 ................................................................................................ 17.248 Bundesgerichtshof, 21 October 1964 [1965] GRUR Int 504 ............................................................................. 24.36 BGH of 2 May 2002 Case IZR 45/01 Faxkarte of BGHZ 150, 377; [2002] GRUR Int 1046; [2002] ZUM-RD 573 ............................................................................................................................................. 12.59 BGH17 December 2010 ‘Preußische Schlösser und Gärten’, (2011) Neue Juristische Wochenschrift 64, 753 ............................................................................................................................................................... 22.59 BGH 1 March 2013 ‘Preußische Schlösser und Parkanlagen’, (2013) Zeitschrift für Urheber- und Medienrecht 57, 571 ................................................................................................................................... 22.59 BGH 19 December 2014 ‘Preußische Kunstwerke’, (2015), Zeitschrift für Urheber- und Medienrecht 59, 496 ............................................................................................................................................................... 22.59 Federal Supreme Court, 21st February 2019, I ZR 98/17, I ZR 99/17 and I ZR 15/18 .................................. 28.22 Bundesverfassungsgericht (Federal Constitutional Court) 1 BvR 1248/11) of 15 December 2011 ................. 11.150

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TABLE OF CASES CA Cologne, Decision of 16 March 2012, No 6 U 206/11 ............................................................................... 11.30 CA Dusseldorf, Decision I-20 U 42/11 8 October 2011 ......................................................................... 11.09, 11.30 Landgericht Bielefeld – case no 4 O 191/11) decision (held on 5.3.2013 .......................................................... 11.48 Landesgericht München I 21st Civ Chamber, judgment of 21 February 2007, [2008] ZUM-RD 310 ........... 24.90 OLG Hamm, 22 U 60/13, 15.5.014 ......................................................................................................... 11.37, 11.48 OLG Karlsruhe 1 October 1996, case 6 U 40/95 (Dongle) (1996) IIC 740 ..................................................... 5.107 OLG Munich, 29 April 2010, Case 29 U 3698/09 ............................................................................................... 6.08 OLG München, 17 July 2018 – 18 W 858/18, [2018] GRUR-RS 17447 ...................................................... 17.269 OLG München, 24 August 2018 – 18 W 1294/18, [2019] AfP 57 ................................................................ 17.269 OLG Munchen, BMG Records GmbH v Heise Zeitshcriften Verlag GmbH & KG, No 29 U 2887/05 28 July 2005 ECLR vol 10, No 31, 792 ................................................................................................. 11.146 OLG Oldenburg, 1 July 2019 – 13 W16/19 ..................................................................................................... 17.269

Greece Case No 4658/2012, Court of First Instance, Athens (preliminary injunction), https://opi.gr/images/library/nomologia/politika/mpr/4658_2012.pdf ..................................................... 12.147

Italy Macchine Automatiche v Windmoller & Holscher KG, judgment of the Supreme Court of 19 December 2003 ............................................................................................................................................................. 24.26 Stiftung Seebüll Ada und Emil Nolde, 4 February 1997, CA Milan [1998] GRUR Int 503 ........................... 24.81

Japan CA Tokyo, decision of 27 January 2000 [2001] GRUR Int 83 .......................................................................... 24.83

Netherlands Autonet v Promasy, Pres. Arr. Arnhem, 27 December 2004 ................................................................................ 9.07 Bigott v Doucal, 27 January 1995, [1995] NIPR 388 ......................................................................................... 24.81 Cassina v Sedeti, Hoge Raad, 26 May 2000, EIPR 2001 ..................................................................................... 2.27 COVA v Banque Générale du Luxembourg [1994] NJ 2901 (No 622) ............................................................. 24.81 Dafurnica (Nadia Plesner Joensen v. Louis Vuitton Malletier SA), District Court The Hague, 4 May 2011, IER 2011/39. .............................................................................................................................................. 28.20 Diplomatic Card/Forax, Supreme Court (Hoge Raad) 19 January 2018, ECLI:NL:HR:2018:56 ...................... 5.22 Louis Vuitton Malletier SA v. Nadia Plesner Joensen, District Court The Hague, 27 January 2011, LJN: BP9616 KG RK 10-214 ............................................................................................................................. 28.20 Mom v VNU, Arrondissementsrechtbank Haarlem, 22 March 2006, 2006 AMI 136 ...................................... 11.30 NVM v Zoekallehuizen.nl, Pres. Arr. Arnhem, 16 March 2006, upheld by CA Arnhem, 4 July 2006 ............. 9.38 Parfums Christian Dior SA and Parfums Christian Dior BV v. Evora BV Supreme Court, 20th October 1995 ............................................................................................................................................................. 28.44 Sanoma Media, Playboy Enterprises International and X v GS Media (GeenStijl), Rb. Amsterdam 12 September 2012 ..................................................................................................................................... 11.30 Wegener v Hunter Select, CA Leeuwarden, 27 November 2002 ......................................................................... 9.54 Zoekallehuizen.nl v NVM, District Court (Arrondissementsrechtbank) Arnhem, 16 March 2006 .................. 11.09 Rb Haarlem 17 August 2011 (case nr 173726/HA ZA 10–1325) ...................................................................... 11.30 CA Amsterdam 15 January 2013 (case nr. 200.095.838/01 ................................................................................ 11.30 CA Arnhem, judgment of 26 June 1993, [1995] BIE 44, [1995] NIPR 555 .................................................... 24.81

Norway Fin Eiendom AS v Notar AS Trondheim District Court, 29 January 2004 [2004] ECLR 9, (7), 18 February 2004 ............................................................................................................................................................. 11.09 Napster.no, Court of Appeal, 3 March 2004, ...................................................................................................... 11.30

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TABLE OF CASES

Peru Peruvian Copyright Commission INDECOPI, Decision 3 November 2009 ..................................................... 24.83

Spain Aranzadi, Case STS 988/2008, 30 January 2008 ................................................................................................... 9.77 Programacion Integral v TLR Soft, 11 November 2002 ....................................................................................... 9.58 Ryanair v Atrapalo, Case STS 572/2012, 9 October 2012. ......................................................................... 9.40, 9.77 Supreme Court, Case STS 7176/2008, 18 December 2008 .................................................................................. 9.08

Sweden Tommy Olsson, Supreme Court, 15 June 2000 ................................................................................................... 11.30

Switzerland Amfit-Lizenz, 29th August 2000, Bundesgericht [2001] GRUR Int 477 .......................................................... 24.36 Eurojobs Personaldienstleistungen SA v Eurojob AG, 23 October 2006, Handelsgericht, Zurich ................... 24.22 Eurojobs Personaldienstleistungen SA v Eurojob AG, Federal Ct, 4 April 2007, I. Zivilabteilung 4C.439/2006 ................................................................................................................................................ 24.22

United Kingdom Anton Piller KG v Manufacturing Processes Ltd [1975] EWCA Civ 12 .......................................................... 12.87 Apple Corps Ltd and Another v Apple Computer Inc and Others [1992] FSR 431, 433 ................................ 24.67 Arsenal Football Club plc v Reed (No 2) [2003] 3 All ER 865, [2003] RPC 696 (CA) ................................. 24.80 BASCA v Secretary of State for Business and Innovation [2015] EWHC 1723; [2015] EWHC 2041 ........ 11.120 British Horseracing Board v William Hill [2001] RPC 612 ................................................................................ 9.42 British Telecommunications plc v Secretary of State for Culture, Olympics, Media and Sport, Case C1/2011/1437, [2012] EWCA Civ 232 .................................................................................................. 21.159 Canon KK v Green Cartridge Co [1997] AC 728, [1997] FSR 817 ................................................................... 4.13 Cartier International and Others v BSkyB and others [2014] EWHC 3354 (Ch) .......................................... 11.190 Forth Dodge Animal Health Ltd v Akzo Nobel NV [1998] FSR 222 .............................................................. 24.26 Gerard and Daniela Maher v Groupama Grand Est [2009] EWCA Civ 1191 ................................................. 24.89 ITV Publications v Time Out [1984] FSR 84 ...................................................................................................... 4.44 John Walker & Sons Ltd v Henry Ost & Co Ltd [1970] 2 All ER 106, [1970] 1 WLR 917 ........................ 24.94 Kabushiki Kaisha Sony Computer Entertainment Inc v Ball [2004] EWHC 1738 (Ch); [2004] ECDR 33, 323, [2005] FSR 9, [2005] ECC 24 ............................................................... 5.140, 5.142, 11.130 L’Oréal SA, Lancôme Parfums et Beauté & Cie and Laboratoire Garnier & Cie v Bellure NV, Malaika Investments (t/a Honeypot Cosmetic & Perfumery Sales) and Starion International Ltd [2008] ETMR 1, [2008] RPC 9 (CA) .................................................................................................................. 24.80 Lakeview Computer Services plc v Steadman (1990) (unreported) ....................................................................... 5.53 Lucasfilm Ltd and others (Appellants) v Ainsworth and another (Respondents) [2011] UKSC 39 ................. 28.11 Magill [2002] EWCA 1905, [2003] FSR 33 CA ................................................................................................. 4.34 Mareva Compania Naviera SA v International Bulkcarriers SA [1975] 2 Lloyd’s Rep 509 ............................ 12.151 Mars UK v Teknowledge [2000] FSR 138 ............................................................................................................ 9.07 Newzbin II case [2011] EWHC 2714 (Ch) ...................................................................................................... 21.162 Public Relations Consultant Association Limited v Newspaper Licensing Agency and others UKSC 18 ........ 11.84 Purple Parking Ltd v Heathrow Airport Ltd [2011] EWHC 987 (Ch) ............................................................. 4.40 Ralli Bros v Cia Naviera Sota y Aznar [1920] 2 KB 287 ................................................................................... 24.50 Research in Motion UK Ltd v Visto Corporation [2008] FSR 20, (2008) 15(11) LSG 23 .............................. 24.27 SAS Institute Inc v World Programming Ltd [2013] EWCA Civ 1482 .................................................... 5.20, 5.31 8PM Chemist Ltd v Eli Lilly Co and Anor [2008] EWCA Civ 24 ................................................................. 21.39 Twentieth Century Fox and others v British Telecommunications plc [2011] EWHC 1981 (Ch) ................ 11.190 Unlockd Ltd v Google Ireland Ltd [2018] EWHC 1363 (Ch) ........................................................................... 4.69 Unwired Planet v Huawei [2018] EWCA Civ 2344 ................................................................................... 4.02, 4.29

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TABLE OF CASES Competition Appeal Tribunal Unlockd Ltd v Google Ireland Ltd [2019] CAT 17 ............................................................................................. 4.69 Office of Fair Trading EI du Pont de Nemours & Co/Op Graphics (Holography) Ltd, Decision CA98/07/2003 ................................ 4.32 Patents Court Knorr-Bremse Systems for Commercial Vehicles Ltd v Haldex Brake Products GmbH.47, 7 February 2008, [2008] EWHC 156 (Pat), [2008] ILPr 26. ............................................................................................... 24.21

United States of America A&M Records v Napster, 239 F.3d 1004, 1027 (9th Cir. 2001) ............................................................ 19.09, 19.10 Agence Fr. Presse v Morel, 934 F.Supp. 2d 547, 566 (S.D.N.Y. 2013 .............................................................. 19.10 Aimster, in re 334 F.3d 643, 650 (7th Cir. 2003) ............................................................................................... 19.11 ALS Scan, Inc v RemarQ Communities, Inc., 239 F.3d 619, 625 (4th Cir. 2001) ........................................... 19.10 Authors Guild Inc v Google Inc 804 F. 3d 202 (2d Cir. 2015) .............................................................. 4.19, 17.168 BMG Rights Mgmt. (US) LLC v Cox Communs., Inc., 881 F.3d 293 (4th Cir. 2018) .................................. 19.04 BWP Media USA Inc. v Hollywood Fan Sites LLC, 115 F.Supp.3d 397, 402–03 (S.D.N.Y. 2015) .............. 19.10 Campbell v Acuff-Rose Music, Inc. 510 US 569, 579 (1994) .............................................................................. 4.19 Capitol Records LLC (EMI) v ReDigi Inc No. 12–00095 (30 March 2013) SD New York (U.S. District Court) ............................................................................................................................................... 11.37, 11.48 Capitol Records, LLC v Vimeo, LLC, 826 F.3d 78, 93–97 (2d Cir. 2016) ........................................... 19.10, 19.11 Columbia Pictures Indus., Inc. v Fung, 710 F.3d 1020, 1045–46 (9th Cir. 2013) ................................. 19.10, 19.13 CoStar Grp. v LoopNet Inc., 373 F.3d 544, 547 (4th Cir. 2004) ...................................................................... 19.10 EMI Christian Music Group v MP3Tunes, 844 F.3d 79 (2d Cir. 2016) ............. 19.04, 19.10, 19.11, 19.13, 19.14 Hendrickson v eBay, 165 F.Supp. 2d 1082, 1088 (C.D. Cal. 2001) .................................................................. 19.10 Io Grp. v Veoh Networks, Inc., 586 F.Supp.2d 1132, 1150 (N.D.Cal. 2008) ................................................... 19.10 Johnson v New Destiny Christian Ctr. Church, Inc., 6:17-cv-710-Orl-37DCI, 2019 WL 1014245 at *4–5 (M.D. Fl. March 4, 2019), appeal pending ................................................................................... 19.17 Kelly v Arriba Soft Corp, 336 F. 3d 811 (2003) ............................................................................................... 11.102 Kirtsaeng v John Wiley & Sons No 11–697, 19 March 2013 ............................................................................ 11.48 Lenz v Universal Music Corp., 815 F.3d 1145, 1153 (9th Cir. 2016) .................................................... 19.17, 19.18 Long v Dorset, 369 F.Supp.3d 939 (N.D.Cal. 2019) .......................................................................................... 19.10 Mavrix Photographs, LLC v LiveJournal, Inc., 873 F.3d 1045, 1057–58 (2d Cir. 2017) ...................... 19.10, 19.14 Metro-Goldwyn-Mayer Studios Inc v Grokster Ltd 545 US 913 (2005) .......................................................... 24.85 Microsoft Corp v AT&T Corp 550 US 437 (2007), [2007] GRUR Int 768 .................................................... 24.83 National Football League v PrimeTime 24 Joint Venture, CA Second Circuit [2000] GRUR Int 1082 ......... 24.83 Omega SA v Costco Wholesale Corp (3 September 2008) ................................................................................ 11.48 Online Policy Grp v Diebold, Inc., 337 F.Supp.2d 1195 (N.D.Cal.2004) ......................................................... 19.17 Perfect 10, Inc v CCBill LLC, 488 F.3d 1102, 1117 (9th Cir. 2007) ............................................................... 19.10 Perfect 10, Inc v Giganews, Inc., 993 F.Supp.2d 1192, 1200 (C.D. Cal. 2014) ................................................ 19.10 Playboy Enters v Chuckleberry Publ’g Inc, 939 F Supp 1032 (SDNY 1996) .................................................... 28.11 Quality King Distributors Inc v L’anza Research International Inc, 9 March 1998 .......................................... 11.48 Religious Tech. Ctr. v Netcom On-Line Comm. Svcs., 907 F.Supp. 1361, 1377 (N.D. Cal. 1995) ............... 19.09 Rosen v Global Net Access, LLC, CV 10-2721-DMG, 2014 WL 2803752 at *5 (C.D. Cal. 2014) .............. 19.10 Rossi v Motion Picture Ass’n of Am Inc., 391 F.3d 1000 (9th Cir.2004) .............................................. 19.17, 19.32 Sterling Drug Inc v. Bayer, 14 F 3d 733 (2d Cir 1994) ..................................................................................... 28.11 Stern v Lavender, 319 F.Supp.3d 650, 683 (S.D.N.Y. 2018) ............................................................................. 19.17 Square Ring, Inc v Doe-1, No. 09-563, 2015 WL 307840, at *7 (D. Del. Jan. 23, 2015) ............................... 19.10 Suntrust Bank v Houghton Mifflin Co, 252 F.3d 1165 (11th Cir. 2001) ........................................................... 4.20 UMG Recordings, Inc v Shelter Capital Partners LLC, 718 F.3d 1006, 1020 (9th Cir. 2013) ............ 19.10, 19.14 UMG Recordings, Inc v Veoh Networks Inc., 665 F. Supp. 2d 1099, 1111 (C.D. Cal. 2009) ........................ 19.10 United States v Terminal Railroad Ass'n, 224 US 383 (1912) ............................................................................. 4.19 Ventura Content Ltd v Motherless, Inc., 885 F.3d 597 (9th Cir. 2018) ........................................................... 19.04 Verizon v Trinko 540 US 398 (2004) .................................................................................................................... 4.19 Viacom Int’l, Inc v YouTube Inc, 676 F.3d 19, 39 (2d Cir. 2012) .............................................. 19.10, 19.11, 19.14 Viacom International, Inc. v YouTube, Inc., 940 F.Supp.2d 110, 116–17 (S.D.N.Y. 2013) ............................. 19.11 Wallace v IBM 467 F.3d 1104 (7th Circ, 2006) ................................................................................................... 4.25

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TABLE OF LEGAL INSTRUMENTS

European Union EC Treaty Art 7 ................................................................... 1.04 Art 12 ................ 1.11, 2.20, 2.27, 6.47, 10.07, 10.59 Art 14 ................................................................ 10.09 Arts 28–29 .......................................................... 6.21 Art 28 ................................................................. 3.04 Art 30 .................................... 1.06, 3.04, 6.22, 12.07 Art 34 ................................................................. 1.06 Art 36 ...................................... 1.03, 1.05, 6.21, 6.22 Art 59 ................................................................. 1.06 Art 60 ................................................................. 1.06 Art 82 ................................................................. 2.25 Art 86 ................................................................. 4.01 Art 95 ................................................................ 12.02 Art 133(5) ......................................................... 12.07 Art 151 .............................................................. 10.10 Art 151(4) ........................................................... 1.19 Art 249 ................................................................ 7.89 Art 249(3) ....................................................... 11.209 Art 255 .............................................................. 27.50 Treaty of Amsterdam Protocol to the on the system of public broadcasting in the Member States (1997) OJ C 340/109 .................................................... 13.11 Treaty of Lisbon ................ 11.87, 21.93, 21.211, 24.75 Treaty of Rome 1957 (EEC Treaty) ... 1.01, 1.03, 1.07 Art 7 ................................................. 2.20, 2.25, 8.71 Art 30 ........................................................ 8.07, 8.08 Art 36 ............................................... 8.07, 8.08, 8.09 Art 86 ................................................................. 2.25 Art 100a ............................................................ 10.09 Treaty on European Union (TEU) 1992 .......... 21.121, 21.227 Art 5 ................................................................. 14.07 Treaty on the Functioning of the European Union (TFEU) 2009 .......................... 2.22, 3.16, 21.227 Art 2(2) ............................................................. 21.93 Art 4(2)(j) ......................................................... 21.93 Art 5 ...................................................... 16.41, 16.42 Art 6(1) ........................................................... 21.157 Art 6(3) ........................................................... 21.157 Art 12 ................................................................ 12.42 Art 18 ......... 2.02, 2.20, 2.22, 2.23, 2.24, 2.27, 2.30, 10.07, 14.29 Art 18.2 ............................................................... 2.31 Art 26 .................................................... 10.09, 15.02 Arts 34–36 ............................................. 11.54, 11.64

Art Art Art Art Art Art Art Art Art Art Art Art Art Art Art

34 ............................................... 3.04, 3.05, 8.07 36 ........................... 2.22, 3.04, 3.05, 8.07, 15.03 50(2)(g) ...................................................... 14.06 53 ................................................................ 14.06 53(1) ........................................................... 14.06 56 ............................................. 3.10, 7.23, 15.14 57 ................................................................ 15.14 62 ................................................................ 14.06 83(1) .............................................. 21.93, 21.211 83(2) .............................................. 21.93, 21.211 101 ..................... 4.03, 4.27, 14.11, 14.51, 15.07 101(1) ........................................................... 4.28 101(1)(b) ...................................................... 4.29 101(3) ........................................................... 4.39 102 ........ 2.25, 4.01–4.42, 4.43, 4.60, 4.62, 4.65, 4.72, 4.73, 4.74, 4.76, 14.11, 14.26, 14.30, 15.07 Art 102(b) .................................................. 4.30, 4.68 Art 102(c) ....................................... 4.27, 4.68, 14.29 Art 102(1)(d) ...................................................... 4.27 Art 107 .............................................................. 14.68 Art 114 .............................. 1.09, 10.09, 12.02, 16.31 Art 118 .............................................................. 29.19 Art 167 ......................................... 2.22, 10.10, 14.06 Art 188 ................................................................ 8.88 Art 207 .............................................................. 16.31 Art 216 .............................................................. 11.79 Art 218(6) ....................................................... 21.256 Art 288 ..................................... 11.70, 11.82, 16.141 Art 345 ............................................. 3.05, 4.40, 4.48 Charter of Fundamental Rights of the European Union (EUCHR), [2000] OJ C 364/1 ...... 11.87, 12.26, 12.146, 15.03, 16.32, 21.159, 21.221, 21.227, 28.40 Art 7 ............................ 12.123, 15.42, 15.43, 21.157 Art 8 ....................................... 12.123, 15.42, 21.157 Art 8.1 ............................................................... 15.43 Art 11 ..... 15.43, 21.170, 28.03, 28.17, 28.18, 28.26, 28.30, 28.31, 28.35, 28.41, 28.42, 28.43, 28.46 Art 11(1) ......................................................... 21.157 Art 13 .............................................................. 21.157 Art 16 ..................................... 15.43, 21.157, 21.170 Art 17 ................... 28.03, 28.17, 28.26, 28.35, 28.46 Art 17(1) ........................................................... 11.88 Art 17(2) ......... 11.87, 11.88, 11.118, 12.26, 12.106, 12.123, 12.228, 17.265, 21.157, 21.160, 21.170, 21.171, 28.18, 28.38, 28.38 Art 21 ...................................................... 2.21, 16.33 Art 21(2) ............................................................. 2.21 Art 26 ................................................................ 16.33

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TABLE OF LEGAL INSTRUMENTS Art 47 ....................................... 12.62, 12.96, 12.106 Art 51(1) ......................................................... 21.169 Art 52(1) ................................. 11.88, 12.177, 21.171 Art 52(3) ......................................................... 11.118 Council Act of 18 December 1997 drawing up, on the basis of Art. K.3 of the Treaty on European Union, the Convention on mutual assistance and cooperation between customs administrations [1998] OJ C24/1 ....................................... 21.130 Council Act of 29 May 2000 establishing in accordance with Art. 34 of the Treaty on European Union the Convention on mutual assistance in criminal matters between the Member States of the European Union [2000] OJ C197/1 ................................................. 21.130 Council Decision (EU) 2017/1790 of 25 September 2017 on the position to be taken, on behalf of the European Union, within the Cooperation Council established by the Partnership and Cooperation Agreement between the European Communities and their Member States, of the one part, and the Republic of Armenia, of the other part, with regard to the adoption of the EU-Armenia Partnership Priorities, OJ L 256, 4.10.2017 ..................................................... 25.30 European Convention on Human Rights (ECHR) ....................................... 21.159, 21.211 Art 8 ................................................................ 21.157 Art 10 .......... 11.89, 11.106, 21.175, 21.176, 21.180, 21.181, 21.183, 28.21, 28.22, 28.25 Art 10(1) ......................................................... 21.157 Protocol 1, art 1 ................................. 21.157, 21.183 EEA Agreement 1994 Art 6 ................................................................... 2.23 Art 11 ................................................................. 3.05 Art 13 ................................................................. 3.05 Annex 17, no 9(e) ............................... 11.54, 11.209 Protocol 28, Art 2 ............................................ 11.54 Rules of Procedure of the Court of Justice of the EU, OJ L 265/1 ....................................... 27.08–27.16 Art 59 ................................................................ 27.12 Art 60 ................................................................ 27.10 Single European Act 1987 ...................................... 1.07 Single Market Act ................................................. 21.73 Statute of the Court of Justice of the EU Art 20 ................................................................ 27.12

EU Regulations Reg 918/83 Community system of reliefs from customs duty [1983] OJ L105/1 Art 45(2)(b) ...................................................... 21.75 Reg 3842/86 .......................................................... 21.72 Reg 3295/94 Measures to prohibit the release for free circulation, export, re-export or entry for a suspensive procedure of counterfeit and pirated goods ................................................ 21.72, 21.78 Reg 515/97 Mutual assistance between the administrative authorities of the Member States

and cooperation between the latter and the Commission to ensure the correct application of the law on customs and agricultural matters [1997] OJ L82/1 ....................................... 21.129 Reg 44/2001 Jurisdiction and the recognition and enforcement of judgments in civil and commercial matters [2001] OJ L/12/1 Art 5(3) ............................................................. 21.65 Art 22(4) ......................... 21.62, 21.70, 21.71, 24.18 Art 27 ................................................................ 21.66 Art 28 ................................................................ 21.66 Reg 45/2001 Protection of individuals with regard to the processing of personal data by the Community institutions and bodies and on the free movement of such data, OJ L 8, 12.1.2001, p. 1 Art 28(2) ........................................................... 14.82 Reg 1049/2001 Public access to European Parliament, Council and Commission documents, OJEC L 145/43 ................................... 27.29, 27.44, 27.52 Art 4.2 ................................................... 27.48, 27.50 Art 4.4 ............................................................... 27.51 Art 7 ................................................................. 27.48 Reg 1206/2001 on cooperation between the courts of the Member States in the taking of evidence in civil or commercial matters, OJ L174/1, 28.05.2001 ................................................. 12.104 Reg 6/2002 Community Design (CDR) [2002] OJ L 3/1 ......................................... 24.91, 29.18, 29.25 Art 80 ......................................... 29.18, 29.18, 29.19 Arts 82–83 ........................................................ 29.18 Art 82 ................................................................ 28.06 Art 83 ................................................................ 28.06 Art 90(3) ........................................................... 21.66 Reg 1049/02 .......................................................... 27.47 Reg 1/2003 Modernisation Regulation: on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty [2003] OJ L1/1 ....................................... 4.02, 4.05, 4.69 Reg 1383/2003 Product Piracy ...... 12.05, 21.72, 21.73, 21.74, 21.75, 21.78 Art 2(1)(a)(i) ..................................................... 21.75 Art 2(1)(b) ............................................. 21.75, 21.80 Art 3(2) ........................................................... 11.168 Art 18 ................................................ 11.165, 11.168 Reg 139/2004 Mergers: on the control of concentrations between undertakings, OJ L 24/1 29.1.2004 ............................................... 4.03 Reg 772/2004 Application of Article 81(3) of the Treaty to categories of technology transfer agreements Art 3(3) ............................................................... 4.34 Reg 864/2007 Rome II: Law applicable to non-contractual obligations, OJ L 199/40 ........... 12.18, 17.158, 24.35, 24.69–24.99 rec 7 .................................................................. 24.73 rec 26 ................................................................ 24.79 Ch II ................................................................. 24.72 Ch III .................................................... 24.72, 24.88 Art 1(1) .................................................. 24.70, 24.75

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TABLE OF LEGAL INSTRUMENTS Art 24 ................................................................ 21.63 Art 24(4) ................................................ 24.13–24.34 Art 25 ................................................................ 21.63 Arts 29–34 ........................................................ 21.68 Art 31(2) ........................................................... 21.68 Art 35 .................................................... 12.18, 21.64 Art 36(1) ........................................................... 21.69 Art 39 ................................................................ 21.70 Art 45(1) ........................................................... 21.69 Art 81 ................................................................ 21.70 Reg 1257/2012 Unitary patent protection Art 5 ................................................................. 29.19 Art 7 ................................................................. 29.19 Art 18 ................................................................ 29.19 Reg 608/2013 Product Piracy (Border Measures) OJ L 181/15 ........ 11.165, 12.05, 12.18, 12.23, 12.148, 21.35, 21.73, 21.75, 21.79, 21.80, 21.85, 21.87, 21.292 rec 24 .............................................................. 12.194 Art 1 ................................................................. 21.75 Art 1(1) ............................................................. 21.78 Art 1(3) ............................................................. 21.78 Art 1(5) ............................................................. 21.75 Art 2 ................................................................. 12.08 Art 2(1) ............................................................. 21.74 Art 2(5) ............................................................. 21.80 Art 2(6) ............................................................. 21.80 Art 2(5)(c) ......................................................... 21.76 Art 2(6) ............................................................. 21.02 Art 2(7)(a) ......................................................... 21.75 Art 2(7)(c) ......................................................... 21.76 Art 2(11) ........................................................... 21.77 Art 2(19) ........................................................... 21.80 Art 3(4) ............................................................. 21.77 Art 6 ................................................................. 21.77 Art 18 .................................................... 12.27, 21.77 Art 21 ................................................................ 21.84 Art 22 ................................................................ 21.79 Art 23 ................................................................ 21.81 Art 23(5) ........................................................... 21.82 Art 24(9) ........................................................... 21.82 Art 26 ................................................................ 21.80 Art 26(10) ......................................................... 21.80 Art 28 ................................................................ 21.77 Art 29(1) ........................................................... 21.83 Art 29(2) ........................................................... 21.83 Reg 910/2014 Electronic identification and trust services for electronic transactions in the internal market (repealing Dir 1999/93/EC) [2014] OJ L 257/73 .......................................................... 15.11 Reg 2015/2120 Measures concerning open internet access (amending Dir 2002/22/EC on universal service and users’ rights relating to electronic communications networks and services and Reg 531/2012 on roaming on public mobile communications networks within the Union) [2015] OJ L 310 1-18 Art 2(2) ............................................................. 20.09 Art 3(3)(a–c) ................................................... 17.133

Art Art Art Art Art Art

1(4) ............................................................. 24.75 3 ................................................................. 24.69 4 ........................................... 24.74, 24.76, 24.78 4(2) ............................................................. 24.78 6 ................................................................. 24.80 8 ......... 24.74, 24.78, 24.79, 24.80, 24.83, 24.87, 24.88, 24.93, 24.95, 28.08 Art 8(1) .. 2.01, 17.204, 17.272, 24.76–24.90, 24.97, 24.98 Art 8(2) ............................................................. 24.92 Art 8(3) ............................................................. 24.91 Art 14 ................................................................ 24.91 Art 15 ......................................... 24.71, 24.88, 24.91 Art 16 .................................................... 24.93, 24.94 Art 26 ................................................................ 24.93 Art 28(1) ........................................................... 24.83 Reg 593/2008 Rome I: Law applicable to contractual obligations [2008] OJ L 177/6 .................. 24.35, 24.36–24.68, 24.93 Art 3 ..................... 24.36, 24.37, 24.38, 24.40, 24.51 Art 3(1) ............................................................. 24.39 Art 3(2) ............................................................. 24.39 Art 3(3) .................................................. 24.52–24.55 Art 3(4) .................................................. 24.52–24.55 Art 4 ...................................................... 24.41, 24.43 Art 4(1) .................................................. 24.41, 24.42 Art 4(2) .................................................. 24.41, 24.42 Art 4(3) ........................... 24.41, 24.44, 24.45, 24.46 Art 4(4) ....................................... 24.41, 24.44–24.46 Art 6 ....................................................... 24.56–24.57 Art 6(1) ............................................................. 24.56 Art 6(4)(a) ......................................................... 24.56 Art 9 ...................................................... 24.51, 24.58 Art 9(1) ............................................................. 24.63 Art 9(2) ............................................................. 24.63 Art 9(3) .................................................. 24.65, 24.66 Art 21 ................................................................ 24.67 Reg 207/2009 Community Trademark Art 46 ................................................................ 22.58 Reg 386/2012 European Union Intellectual Property Office ......................................................... 17.195 Reg 1215/2012 Jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Brussels I) [2012] OJ L351/1 .......... 12.18, 21.35, 21.62–21.71, 21.106, 21.111, 24.02, 24.73 rec 24 ................................................................ 21.68 rec 25 ................................................................ 12.18 Ch III ................................................................ 21.66 Art 2 .................................................... 21.111, 24.21 Art 4 ................... 21.66, 21.67, 21.108, 24.02, 28.07 Art 5 ................................................................ 21.111 Art 5(3) ............................................................. 24.21 Art 4(1) .................................................. 21.64, 24.02 Art 7 ................................................................ 21.109 Art 7(1) ................................................ 21.110, 24.02 Art 7(2) ..... 21.64, 21.65, 24.02, 24.03–24.06, 28.07 Art 8(1) ....................................... 24.02, 24.07–24.12 Art 17(1)(c) ....................................................... 21.65 Art 22(4) ........................................................... 24.20

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TABLE OF LEGAL INSTRUMENTS Reg 2016/679 General Data Protection Regulation (GDPR) (Protection of natural persons with regard to the processing of personal data and on the free movement of such data), repealing Directive 95/46/EC, OJ L 119, 4.5.2016, pp. 1–88 ....... 12.18, 12.122, 14.82, 15.02, 15.29, 15.30, 15.42, 16.123, 17.288, 18.05, 21.42, 21.162 rec 39 ..................................................... 15.43, 15.44 Art 5 ................................................................. 15.29 Art 5(1)(a) ......................................................... 15.43 Art 5(1)(b) ........................................................ 15.42 Art 5(1)(c) ......................................................... 15.42 Art 5(1)(g) ...................................................... 12.122 Art 6 ................................................................. 15.29 Art 6(b) ............................................................. 15.43 Art 6(c) ............................................................. 15.43 Art 23(1) ......................................................... 21.159 Art 51 ................................................................ 15.44 Art 58 ................................................................ 15.44 Reg 2016/794 European Union Agency for Law Enforcement Cooperation (Europol) (replacing and repealing Council Decisions 2009/371/JHA, 2009/934/JHA, 2009/935/JHA, 2009/936/JHA and 2009/968/JHA) [2016] L135/53 ....... 21.121 Reg 2017/1001 European Trademark Regulation (EUTMR) [2017] OJ L 154/1 ........ 24.92, 29.18 Art 9(4) ............................................................. 21.78 Art 123 .............................................................. 29.18 Arts 125–126 .................................................... 29.18 Art 125 .............................................................. 28.06 Art 126 .............................................................. 28.06 Art 126(1) ......................................................... 21.66 Reg 2017/1128 Portability Regulation [2017] OJ L 168/1 ... 15.01–15.48, 23.19, 23.22, 26.01, 29.01, 30.02 rec 1 ............................................ 15.05, 15.10, 15.39 rec 2 .................................................................. 15.05 rec 4 ....................................................... 15.05, 15.14 rec 6 .................................................................. 15.05 rec 10 ................................................................ 15.38 rec 14 ..................................................... 15.06, 15.09 rec 15 ................................................................ 15.05 rec 16 ..................................................... 15.08, 15.14 rec 17 ................................................................ 15.08 rec 19 ................................................................ 15,21 rec 20 ..................................................... 15.19, 15.35 rec 21 ..................................................... 15.18, 15.25 rec 22 ..................................................... 15.22, 15.24 rec 23 ............................... 15.16, 15.24, 15.25, 15.26 rec 24 ................................................................ 15.26 rec 25 ................................................................ 15.41 rec 26 ..................................................... 15.27, 15.30 rec 27 ..................................................... 15.27, 15.31 rec 28 ..................................................... 15.30, 15.32 rec 29 ..................................................... 15.32, 15.33 rec 30 ..................................................... 15.42, 15.44 rec 33 ................................................................ 15.07 rec 34 ..................................................... 15.07, 15.08 Art 1 ........................................... 15.04–15.08, 15.39

Art 2 ....................................................... 15.09–15.16 Art 2.5(i) ........................................................... 15.14 Art 2.5(ii) .......................................................... 15.14 Art 2.12 ............................................................. 15.05 Art 3 ........................................... 15.17–15.25, 15.43 Art 3.1 ................................................... 15.20, 15.23 Art 3.2 ................................................... 15.21, 15.35 Art 4 ...................................................... 15.26, 29.11 Art 5 ................................ 15.19, 15.27–15.33, 15.35 Art 5.1 ........................................ 15.11, 15.27, 15.28 Art 5.1(k) .......................................................... 15.28 Art 5.2 ................................................... 15.28, 15.29 Art 5.2(ii) .......................................................... 15.14 Art 5.3 ................................................... 15.28, 15.43 Art 5.4 ............................................................... 15.33 Art 5.5 ............................................................... 15.33 Art 6 ....................................................... 15.34–15.36 Art 7 ........................................... 15.37–15.41, 15.45 Art 8 ....................................................... 15.42–15.44 Art 9 ........................................... 15.40, 15.45–15.46 Art 10 ................................................................ 15.47 Art 11 ................................................................ 15.48 Reg 2017/1563 Marrakesh Treaty Regulation (MTR) (Cross-border exchange between the Union and third countries of accessible format copies of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled) OJEU L 242/1, 20.09.2017 ...... 16.19, 16.37–16.39, 16.49, 16.65, 16.124, 16.141, 16.144–16.166, 26.01 rec 5 ................................................................ 16.148 Art 1 ...................................... 16.146, 16.147–16.149 Art 2 .................................................. 16.145, 16.149 Arts 3–4 ............................................................ 16.51 Art 3 .......................... 16.83, 16.146, 16.150–16.166 Art 4 .......................... 16.83, 16.146, 16.150–16.166 Art 5 ..................................... 16.144, 16.145, 16.166 Art 5.2(b) ........................................................ 16.116 Art 6 .................................................. 16.145, 16.166 Art 7 ................................................................ 16.166 Art 8 .................................................. 16.145, 16.166 Reg 2017/1939 European Public Prosecutor’s Office (EPPO) [2017] OJ L183/1 ....................... 21.129 Reg 2018/302 Geo-Blocking Regulation addressing unjustified geo-blocking and other forms of discrimination based on customers’ nationality, place of residence or place of establishment within the internal market (amending Regs 2006/2004 and 2017/2394 and Dir 2009/22) [2018] OJ L 601/1 ...................................... 15.02 rec 1 ....................................................... 15.01, 15.02 Art 3 ...................................................... 15.37, 15.38 Reg 2018/1727 European Union Agency for Criminal Justice Cooperation (Eurojust), replacing and repealing Council Dec 2002/187/JHA [2018] OJ L295/138 Art 1 ................................................................ 21.127 Art 3 ................................................................ 21.127 Art 21 .............................................................. 21.127

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Date: 11/2

JOBNAME: Law Prac2 - Stamatou PAGE: 19 SESS: 3 OUTPUT: Thu Feb 25 10:52:08 2021

TABLE OF LEGAL INSTRUMENTS Art 49 .............................................................. 21.127 Art 50 .............................................................. 21.127 Art 51 .............................................................. 21.127 Art 51 .............................................................. 21.127 Art 52 .............................................................. 21.127 Art 53 .............................................................. 21.127 Reg 2019/787 Art 21(2) ........................................................... 21.78 Art 24(1) ........................................................... 21.78

EU Directives Dir 552/89 Television without Frontiers (TWF) .. 7.02 Dir 89/104 Trade marks, OJ L 40/1, 11.2.1989 .. 11.63 Dir 91/240 [1991] OJ L122/4246 (repealed and replaced by Dir 2009/24/EU) OJ L111/16 ....................................................... 26.01 Dir 91/250 Computer programs (codified as Dir 2009/24) ....... 1.07, 6.01, 6.50, 6.55, 6.56, 11.01, 11.03, 11.28, 11.196, 12.02, 25.23 rec 7 .................................................................... 5.17 Art 1(1) ............................................................... 8.04 Art 1(3) ...................................................... 8.57, 8.59 Arts 4–6 ............................................................ 11.11 Art 4(c) ...................................................... 3.09, 6.57 Art 4(2) ............................................................. 11.56 Art 6 ................................................................... 4.57 Art 8 ................................................................... 8.83 Art 8(1) ...................................................... 8.15, 8.83 Art 9 ................................................................ 11.194 Art 10 ................................................................ 5.148 Dir 92/100 Rental and lending rights, OJ L 346/61 (codified by Dir 2006/115) ........ 1.08, 6.06, 6.33, 6.73, 6.75, 6.78, 6.79, 7.02, 7.36, 7.45, 7.55, 7.66, 8.69, 11.01, 11.196, 25.23, 26.01 rec 1 ........................................................... 6.08, 6.09 rec 3 .................................................................... 6.09 Art 1(4) ............................................................... 3.09 Art 2(2) ............................................................... 6.42 Art 6 ................................................................... 6.76 Art 7 ................................ 6.76, 11.03, 11.05, 11.198 Art 8 ........................................................ 6.76, 11.14 Art 8(2) ............... 6.86, 6.92, 6.93, 6.94, 8.04, 11.21 Art 9(2) ............................................................. 11.56 Art 10(3) ................................................ 1.03, 11.199 Art 11 ................................................................. 8.84 Art 12 ............................. 8.35, 8.37, 8.41, 8.42, 8.84 Art 13 ................................................................. 6.06 Art 14 ................................................................. 8.35 Dir 93/83 Satellite and Cable Directive [1993] OJ L 248/15 ............. 1.08, 1.15, 6.64, 7.01–7.89, 9.11, 11.01, 11.03, 11.196, 14.15, 20.13, 26.01, 29.01 rec 6 .................................................................... 7.08 rec 14 .................................................................. 7.13 rec 16 ......................................................... 7.38, 7.38 rec 17 ................................................ 7.18, 7.38, 7.54 rec 24 .................................................................. 7.06 rec 26 .................................................................. 7.50 rec 27 ......................................................... 7.63, 7.65

rec 28 ................................................................ 14.02 rec 29 ....................................................... 7.75, 14.02 rec 30 ......................................................... 7.80, 7.82 rec 34 .............................................. 7.52, 7.85, 14.02 Ch II ................................................................... 8.27 Art 1 ................................................. 7.01–7.33, 8.31 Art 1(1) ................. 7.07–7.11, 7.34, 7.36, 7.45, 7.53 Art 1(2) ................................... 7.34, 7.36, 7.48, 7.53 Art 1(2)(a) ...................... 7.12–7.16, 7.17, 7.31, 7.88 Art 1(2)(b) ........................................ 7.17–7.19, 7.34 Art 1(2)(c) ......................................... 7.20–7.24, 7.30 Art 1(2)(d) ................................................. 7.25–7.26 Art 1(3) ............................................. 7.27–7.31, 7.63 Art 1(4) ................................ 7.32–7.33, 14.02, 14.16 Art 1(5) ............................................................... 7.36 Art 2 ........... 7.16, 7.34–7.36, 7.37, 7.45, 8.31, 11.17 Art 2(b) ............................................................. 29.11 Art 3 ................................................. 7.37–7.44, 7.45 Art 3(1) ............................................. 7.37–7.39, 7.54 Art 3(2) ............... 7.32, 7.37, 7.40–7.42, 7.44, 14.02 Art 3(3) .................................................... 7.43, 13.17 Art 3(4) ............................................................... 7.44 Art 4 ...................................... 7.45–7.50, 7.52, 11.14 Art 4(1) .................................... 7.36, 7.45–7.47, 7.55 Art 4(2) ...................................................... 7.36, 7.48 Art 4(3) ...................................................... 7.49–7.50 Art 5 ................................................................... 7.51 Art 6 ................................................. 7.46, 7.52–7.54 Art 6(1) ...................................................... 7.52, 7.53 Art 6(2) ...................................................... 7.53–7.54 Art 7 ........................................................... 7.55–7.62 Art 7(1) ...................................................... 7.55–7.57 Art 7(2) ............................................. 7.58–7.59, 7.61 Art 7(3) ...................................................... 7.60–7.62 Art 8 ........................................................... 7.63–7.67 Art 8(1) .................................... 7.63–7.66, 7.70, 7.84 Art 8(2) ............................................................... 7.67 Arts 9–12 .......................................................... 11.27 Art 9 ...................................... 7.64, 7.68–7.73, 14.02 Art 9(1) .................................... 7.68–7.70, 7.73, 7.74 Art 9(2) ............................................. 7.71–7.72, 7.75 Art 9(3) ............................................................... 7.73 Art 10 ............................. 7.64, 7.68, 7.70, 7.74–7.75 Art 11 ......................................................... 7.76–7.79 Art 11(1) .................................................... 7.76–7.77 Art 11(2) ............................................................. 7.78 Art 11(3) ............................................................. 7.78 Art 11(4) ............................................................. 7.79 Art 12 ............................................... 7.76, 7.80–7.83 Art 12(1) .................................................... 7.80–7.82 Art 12(2) ............................................................. 7.83 Art 12(3) ............................................................. 7.83 Art 13 ........................... 7.82, 7.83, 7.84–7.85, 14.02 Art 14 ............................................... 7.62, 7.86–7.88 Art 14(1) ............................................................. 7.86 Art 14(2) ............................................................. 7.86 Art 14(3) .................................. 7.04, 7.86, 7.87–7.88 Art 15 ................................................................. 7.89

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Division: TableCases

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Date: 11/2

JOBNAME: Law Prac2 - Stamatou PAGE: 20 SESS: 5 OUTPUT: Thu Feb 25 10:52:08 2021

TABLE OF LEGAL INSTRUMENTS 14.80, 16.62, 16.65, 16.124, 17.02, 17.47, 17.53–17.71, 17.72, 17.96, 17.97, 17.113, 26.01 rec 7 .................................................................... 9.37 rec 10 .................................................................. 9.04 rec 11 .................................................................. 9.32 rec 12 ......................................................... 9.04, 9.32 rec 16 .................................................................. 8.59 rec 17 ....................................................... 9.03, 17.09 rec 19 ......................................................... 9.04, 9.36 rec 20 .................................................................. 9.08 rec 21 .................................................................. 9.05 rec 24 .................................................................. 9.23 rec 25 .................................................................. 9.30 rec 29 .................................................................. 9.19 rec 33 .................................................................. 9.25 rec 35 .................................................................. 9.26 rec 39 .................................................................. 9.37 rec 40 .................................................................. 9.37 rec 41 .................................................................. 9.44 rec 42 ..................................................... 9.45, 17.110 rec 43 .................................................................. 3.11 rec 45 .................................................................. 9.02 rec 46 .................................................................. 9.02 rec 47 .................................................................. 9.02 rec 48 .................................................................. 9.45 rec 55 ......................................................... 9.42, 9.69 rec 60 .................................................................. 9.76 Art 1 ........................... 9.01–9.08, 9.09, 22.60, 25.44 Art 1(1) ............................................................... 9.01 Art 1(2) ...................... 9.02–9.06, 9.77, 17.09, 17.37 Art 1(3) ...................................................... 9.07–9.08 Art 1(6) ............................................................... 9.35 Art 2 ........................................................... 9.09–9.11 Art 2(a) ............................................................. 17.62 Art 3 ...................................... 9.12–9.16, 9.67, 25.44 Art 3(1) ...... 8.57, 8.59, 9.14, 9.15, 9.75, 9.76, 17.53 Art 4 ............................. 9.17–9.19, 9.44, 9.67, 25.44 Art 4(1) ............................................................... 9.17 Art 4(2) ............................................................... 9.18 Art 4(3) ............................................................... 9.17 Arts 5–6 ............................................................ 11.11 Art 5 ......... 9.20–9.26, 9.30, 9.49, 9.67, 17.54, 25.44 Art 5(a) ........... 9.24, 17.120, 17.153, 17.164, 17.191 Art 5(b) ................................... 17.45, 17.153, 17.191 Art 5(c) ...................................................... 9.23, 9.49 Art 5(d) ....................... 11.17, 11.28, 17.153, 17.191 Art 5(e) ..................................... 9.24, 17.153, 17.191 Art 5(1)(c) ......................................................... 11.43 Art 5(2) ............................................................. 11.56 Art 6 ............................. 9.27–9.30, 9.59, 9.67, 25.44 Art 6(1) ......................................... 9.27, 9.82, 17.104 Art 6(2) ...................................................... 9.28, 9.64 Art 6(2)(b) .............................. 17.97, 17.151, 17.285 Art 6(2)(c) ........................................................... 9.66 Art 6(2)(d) ................................................. 9.28, 9.29 Art 6(3) ............................................................... 9.29 Art 7 .......... 9.12, 9.14, 9.21, 9.31–9.56, 9.70, 11.26, 22.60 Art 7(1) .......... 9.35, 9.51, 9.52–9.54, 17.59, 17.108, 17.120, 17.153, 17.164

Dir 93/98 Term of protection (last amended by Dir 2011/77, codified by Dir 2006/116) ... 1.08, 2.26, 6.07, 8.01–8.88, 10.75, 11.01, 11.196, 25.23, 26.01 rec 2 .................................................................... 8.71 rec 3 .................................................................... 8.06 rec 6 .................................................................... 8.13 rec 7 .................................................................... 8.13 rec 11 ......................................................... 8.06, 8.13 rec 14 .................................................................. 8.17 rec 15 ......................................................... 8.64, 8.83 rec 16 ......................................................... 8.57, 8.84 rec 21 .................................................................. 8.60 rec 22 .................................................................. 8.60 Art 1 .................... 8.01–8.24, 8.57, 8.68, 8.83, 10.74 Art 1(1) ................................... 8.13, 8.21, 8.34, 8.53 Art 1(2) ............................................ 8.17, 8.21, 8.34 Art 1(3) ...................................................... 8.20, 8.21 Art 1(4) ............................................................... 8.21 Art 1(5) ...................................................... 8.23, 8.27 Art 1(6) ............................................................... 8.22 Art 1(7) ...................................................... 8.18, 8.77 Art 2 ................................................. 8.25–8.34, 8.74 Art 2(a) ............................................................... 8.49 Art 2(1) ...................................................... 8.25, 8.27 Art 2(2) ................. 6.42, 8.25, 8.28, 8.31, 8.33, 8.34 Art 3 ........................................ 8.35–8.51, 8.81, 8.82 Art 3(1) ............................................ 8.45, 8.77, 8.79 Art 3(2) ....... 8.48, 8.77, 8.79, 11.03, 11.200, 11.201 Art 3(2)(b) .......................................................... 8.50 Art 3(2)(c) ........................................................... 8.50 Art 3(4) ............................................................... 8.42 Art 4 ........................................ 8.52–8.53, 8.54, 8.55 Art 5 ................................................. 8.52, 8.54–8.55 Art 6 ................................................. 8.15, 8.56–8.59 Art 7 ................................................. 2.26, 8.60–8.63 Art 7(3) ............................................................... 8.63 Art 8 ........................................................... 8.64–8.65 Art 9 ........................................................... 8.66–8.67 Art 10 ............................................... 8.13, 8.68–8.78 Art 10(1) ........................................... 8.16, 8.68, 8.75 Art 10(2) .................................................... 8.69, 8.75 Art 10(3) ............................................................. 8.75 Art 10(4) .................................................... 8.29, 8.74 Art 10(5) ............................................................. 8.77 Art 10(6) .................................................... 8.77, 8.78 Art 10A ...................................................... 8.79–8.80 Art 11 ............................. 8.58, 8.81–8.82, 8.83–8.84 Art 11(1) ........................................... 8.15, 8.55, 8.58 Art 11(2) ............................................................. 8.37 Art 12 ................................................................. 8.85 Art 13(1) ............................................................. 8.86 Dir 95/46 Processing of personal data ... 12.18, 12.122, 14.82, 15.42, 16.123, 21.162, 21.165 Art 13(1)(g) .................................................... 12.122 Art 15(1) ......................................................... 21.159 Dir 96/9 Database Directive (Legal protection of databases) ...... 1.08, 1.15, 2.28, 5.36, 5.84, 5.100, 9.01–9.83, 11.01, 11.03, 11.131, 11.194, 11.196,

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Job: Stamatoudi_2_EU_copyright_law

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Division: TableCases

/Pg. Position: 6 /

Date: 24/2

JOBNAME: Law Prac2 - Stamatou PAGE: 21 SESS: 6 OUTPUT: Thu Feb 25 10:52:08 2021

TABLE OF LEGAL INSTRUMENTS Art 7(2)(b) ........................... 9.31, 9.49, 11.56, 17.66 Art 7(3) ............................................................... 9.31 Art 7(4) ...................................................... 9.51, 9.55 Art 7(5) ...................... 9.51, 9.56, 9.60, 9.61, 17.111 Art 8 ............. 9.27, 9.28, 9.57–9.62, 9.67, 9.82, 9.83 Art 8(1) ............................... 9.57, 9.60, 9.61, 17.107 Art 8(2) ...................................................... 9.57, 9.61 Art 8(3) ......................................... 9.57, 9.62, 12.176 Art 9 ...................... 9.27, 9.28, 9.61, 9.63–9.67, 9.83 Art 9(b) ................................. 17.100, 17.101, 17.151 Art 9(c) ............................................................... 9.66 Art 10 ......................................................... 9.68–9.70 Art 10(1) .................................................... 8.43, 9.68 Art 10(2) .................................................... 8.43, 9.68 Art 10(3) .................................................... 9.69, 9.70 Art 11 ...................................... 2.29, 9.31, 9.71–9.72 Art 11(1) ............................................................. 9.71 Art 11(2) ............................................................. 9.71 Art 11(3) ............................................................. 9.71 Art 12 .................................................... 9.73, 11.165 Art 13 ...................................... 4.04, 9.31, 9.74–9.78 Art 14 ......................................................... 9.79–9.81 Art 14(1) ............................................................. 9.79 Art 14(2) ............................................................. 9.80 Art 14(3) ............................................................. 9.81 Art 14(4) ............................................................. 9.81 Art 14(5) ............................................................. 9.81 Art 15 ................................ 9.60, 9.82, 16.92, 17.105 Art 16 ........................................................ 4.04, 9.83 Art 16(3) ............................................................. 9.83 Dir 98/71 Legal protection of design ..................... 2.27 Dir 98/84 Conditional Access (on the legal protection of services based on, or consisting of, conditional access) OJ 1998 L 320/54 Art 3(2) ............................................................... 7.23 Art 4 .................................................. 11.127, 11.128 Dir 99/93 Electronic signatures ............................ 12.18 Dir 2000/31 E-Commerce Directive ... 11.172, 11.173, 12.122, 12.176, 12.181, 21.35, 21.42, 21.137, 21.138, 21.139–21.152, 21.155, 21.156, 21.159, 21.162, 21.165, 21.169, 21.185, 21.186, 21.197, 21.245, 21.294, 21.295, 23.37, 25.64, 28.07 rec 15 ................................................... 12.18, 12.176 rec 18 .................................................................. 3.11 rec 26 .............................................................. 11.179 rec 40 .............................................................. 21.139 rec 42 .............................................................. 11.186 rec 43 ................................................. 11.183, 11.184 rec 44 .............................................................. 11.186 rec 45 ................................................. 11.190, 21.155 rec 47 .................................... 11.175, 12.182, 21.140 rec 48 ................................................. 12.182, 21.140 rec 50 .............................................................. 11.190 Art 1(5)(b) ...................................................... 12.127 Art 3 ................................................................ 21.159 Art 3(2) ........................................................... 17.272 Arts 12–14 ............... 11.174, 11.186, 12.218, 21.139 Arts 12–15 ................. 11.181–11.188, 12.181, 25.64 Art 12 ................................... 11.174, 21.140, 21.159

Art 12(1) ... 11.181, 21.141, 21.142, 21.143, 21.144, 21.145 Art 12(2) ............................................ 11.182, 21.146 Art 12(3) ............................................ 11.189, 21.145 Art 13 ................................................ 11.174, 21.140 Art 13(1) ............................... 11.184, 21.143, 21.144 Art 13(2) ............................................ 12.189, 21.146 Arts 14–15 ...................................................... 12.181 Art 14 ............ 11.174, 17.257, 19.01, 19.02, 21.140, 21.147, 21.148, 21.149 Art 14(1) ..... 17.257, 17.258, 19.24, 21.139, 21.143, 21.144, 21.148, 23.25 Art 14(1)(b) .................................................... 21.148 Art 14(3) ............................................ 11.189, 21.146 Art 15 ....................................... 19.02, 21.159, 23.25 Art 15(1) ..... 11.174, 12.181, 12.182, 19.02, 21.140, 21.172, 21.173 Art 15(2) ............................... 11.180, 12.127, 21.146 Art 16 ................................... 12.229, 21.139, 21.194 Art 18 .............................................................. 12.127 Art 20.11 ........................................................... 25.64 Dir 2001/21 Art 3(1) ............................................................... 7.16 Dir 2001/29 InfoSoc Directive (ISD) (Harmonisation of certain aspects of copyright and related rights in the information society) OJ L167 ........... 1.09, 1.14, 3.13, 5.04, 5.05, 5.12, 5.20, 5.31, 5.32, 5.84, 5.88, 5.100, 6.08, 6.33, 6.48, 6.78, 6.103, 7.03, 7.16, 7.35, 8.12, 9.21, 11.01–11.209, 12.02, 12.22, 12.23, 12.181, 13.10, 13.15, 13.24, 14.12, 14.80, 15.02, 16.65, 16.124, 17.02, 17.35, 17.47, 17.48–17.52. 17.57, 17.72, 17.97, 17.113, 17.245, 17.255, 21.35, 21.36–21.39, 21.154, 21.155, 21.156, 21.201, 22.64, 22.81, 23.20, 26.01, 26.03, 28.35, 28.39, 28.48, 29.01, 30.05 rec 3 .................................................................. 28.38 rec 4 ....................................................... 11.69, 11.87 rec 7 .................................................................. 29.10 rec 9 ....................................................... 11.34, 11.87 rec 10 ....................................................... 6.08, 11.34 rec 16 ............................. 7.39, 11.190, 12.17, 21.155 rec 17 ....................................................... 7.39, 14.02 rec 18 ..................................................... 13.73, 14.02 rec 19 .............................................................. 11.113 rec 21 ................................................................ 11.87 rec 22 ................................................................ 21.36 rec 23 ..................................................... 11.18, 11.34 rec 24 ....................................................... 6.48, 11.25 rec 26 ................................................................ 14.02 rec 27 ................................................................ 11.21 rec 28 .............. 3.15, 5.84, 6.22, 11.42, 11.43, 11.47 rec 29 ................................... 3.11, 5.84, 11.36, 11.47 rec 30 .............................................................. 11.101 rec 31 .......................................... 11.69, 21.36, 28.38 rec 32 ...................... 5.99, 11.72, 11.82, 28.37, 28.42 rec 33 ................................. 9.58, 11.84, 17.79, 17.80 rec 34 ................................................................ 17.90 rec 35 ................................................... 11.116, 16.78 rec 36 .............................................................. 11.114 rec 38 .............................................................. 11.119

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Job: Stamatoudi_2_EU_copyright_law

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Division: TableCases

/Pg. Position: 7 /

Date: 24/2

JOBNAME: Law Prac2 - Stamatou PAGE: 22 SESS: 5 OUTPUT: Thu Feb 25 10:52:08 2021

TABLE OF LEGAL INSTRUMENTS Art 5(3)(d) ....... 11.13, 11.92, 11.99, 11.106, 17.239, 28.41 Art 5(3)(e) ........................................................... 9.66 Art 5(3)(f) ............................... 11.99, 11.106, 11.113 Art 5(3)(h) ........................................... 11.99, 11.106 Art 5(3)(k) ........................................................ 11.99 Art 5(3)(n) ......................... 6.27, 6.48, 11.105, 22.70 Art 5(3)(o) .................................. 11.72, 11.96, 11.99 Art 5(4) ............................................................. 11.99 Art 5(5) ........ 9.29, 9.61, 11.04, 11.78–11.81, 11.84, 11.118, 11.121, 13.77, 16.74, 16.76, 17.87, 17.166, 18.24, 21.184, 28.41 Art 6 ......... 5.138, 5.141, 9.74, 11.03, 11.04, 11.109, 11.126–11.150, 11.151, 11.162, 11.202, 12.17, 21.37, 25.49, 25.50 Art 6(1) ................................. 11.127, 11.135–11.140 Art 6(2) .................... 11.127, 11.141–11.150, 11.170 Art 6(2)(c) ......................................................... 5.141 Art 6(3) ................................. 11.127, 11.129–11.134 Art 6(4) ...... 11.107, 11.109–11.112, 11.127, 11.150, 16.86, 16.87, 16.88, 16.89, 16.90, 16.92, 16.94, 16.96, 16.97, 17.149, 17.150, 17.166 Art 7 ... 11.03, 11.04, 11.126, 11.151–11.164, 21.37, 25.49, 25.50 Art 7(1)(b) ...................................................... 11.131 Art 7(2) ........................................................... 11.152 Art 8 ... 11.04, 11.165–11.193, 11.202, 12.17, 12.21, 21.38 Art 8(1) .......... 11.168–11.169, 12.27, 12.127, 21.38, 21.137 Art 8(2) ..................... 11.170, 12.127, 21.38, 21.137 Art 8(3) .......... 11.171–11.193, 12.21, 12.142, 21.38, 21.39, 21.162, 21.168, 21.169, 21.172, 21.182, 28.10 Art 9 .......................... 11.194–11.195, 12.126, 15.02 Art 10 ................................................. 11.196–11.197 Art 10(1) .............................................. 11.69, 11.196 Art 10(2) ......................................................... 11.197 Art 11 ................................................. 11.198–11.201 Art 11(1) ............................................ 11.198–11.199 Art 11(1)(a) .......................................... 11.05, 11.198 Art 11(1)(b) ......................................... 11.03, 11.199 Art 11(2) ................................. 11.03, 11.200–11.201 Art 11(2)(1) .................................................... 11.200 Art 11(2)(2) .................................................... 11.201 Art 11(4) ........................................................... 11.76 Art 12 .................................... 11.104, 11.202–11.206 Art 12(1) ................................................ 9.83, 11.202 Art 12(2) ......................................................... 11.203 Art 12(3) ............................................ 11.204–11.206 Art 12(4) ............................... 11.204–11.206, 17.285 Art 13 ....................................... 9.83, 11.202, 11.207 Art 14 .............................................................. 11.208 Art 15 .................................................. 11.04, 11.209 Art 24 ................................................................ 11.04 Dir 2001/84 Resale Right (for the benefit of the author of an original work of art) ................ 1.08, 10.01–10.100, 11.01, 26.01 rec 3 .................................................................... 6.18 rec 6 .................................................................. 10.59

rec 41 ................................................................ 11.86 rec 42 ................................................... 11.105, 17.95 rec 44 ................................................................ 11.78 rec 45 .............................................................. 11.107 rec 47 .............................................................. 11.131 rec 48 .................................... 11.131, 11.134, 11.140 rec 49 .............................................................. 11.147 rec 50 ..................................................... 5.99, 11.127 rec 51 .............................................................. 11.107 rec 52 .............................................................. 11.119 rec 54 .............................................................. 11.163 rec 55 .............................................................. 11.164 rec 57 .............................................................. 11.153 rec 59 ......................... 11.190, 12.178, 21.38, 21.160 rec 60 .............................................................. 11.195 Art 1 ......................... 8.31, 9.24, 11.02–11.04, 11.05 Art 1(1) ............................................................. 11.02 Art 1(2) ................. 9.28, 11.03-11.04, 11.43, 11.196 Art 1(2)(a) ......................................................... 11.45 Arts 2–3 ............................................................ 13.31 Arts 2–4 ................................................. 11.68, 28.39 Arts 2–5 ................................................. 11.11, 12.17 Arts 2–6 ............................................................ 12.17 Art 2 ....... 5.62, 5.64, 6.76, 7.46, 8.27, 11.03, 11.04, 11.05–11.13, 11.75, 11.198, 13.17, 13.66, 14.22, 15.01, 15.02, 17.48, 17.88, 17.120, 17.121, 17.153, 21.36, 22.65, 28.31 Art 2(c) ............................................................. 22.70 Art 2(e) ............................................................. 15.02 Art 3 .................. 3.11, 5.75, 7.03, 8.27, 8.31, 11.04, 11.14–11.41, 11.48, 11.51, 11.75, 13.17, 13.66, 14.22, 17.88, 17.153, 17.255, 21.36 Art 3(1) ..... 5.93, 6.86, 6.87, 7.10, 7.14, 7.66, 11.24, 11.31, 17.251, 17.252, 21.137, 28.31 Art 3(2) .................. 6.48, 7.46, 11.03, 11.14, 17.251 Art 3(3) ............................................................. 11.36 Art 4 . 6.22, 6.100, 11.04, 11.42–11.67, 13.66, 21.36 Art 4(2) .................................................... 3.15, 11.70 Art 5 ..... 9.28, 11.04, 11.68–11.125, 11.202, 16.125, 17.252, 17.264, 17.265, 18.24, 18.25, 21.35, 22.66, 28.30, 28.35, 28.36, 28.39, 28.43 Art 5(1) ...... 9.58, 11.10, 11.73, 11.84, 11.86, 11.87, 11.92, 11.121, 11.182, 11.185, 11.188, 16.61, 17.51, 17.52, 17.74, 17.103, 17.137 Art 5(2) ............... 11.74, 11.75, 11.78, 11.94, 16.62, 17.285 28.31, 29.05 Art 5(2)(a) ............................ 11.105, 11.114, 11.119 Art 5(2)(b) ... 11.99, 11.105, 11.114, 11.119–11.121, 11.199, 12.10, 12.208 Art 5(2)(c) ......... 11.99, 11.119, 13.10, 13.25, 13.66, 17.95, 22.67, 22.68 Art 5(2)(d) .................................. 11.12, 11.86, 11.96 Art 5(2)(e) ............................ 11.114, 11.118, 11.119 Art 5(3) ........ 7.38, 9.65, 11.04, 11.74, 11.75, 11.94, 16.62, 16.128, 17.285, 28.31, 29.05 Art 5(3)(a) ....... 11.99, 11.113, 17.88, 17.89, 17.131, 17.151 Art 5(3)(b) ..... 11.99, 11.118, 16.88, 16.124, 16.125, 16.126 Art 5(3)(c) ........ 11.99, 11.106, 11.113, 15.02, 28.41

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Job: Stamatoudi_2_EU_copyright_law

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Division: TableCases

/Pg. Position: 8 /

Date: 24/2

JOBNAME: Law Prac2 - Stamatou PAGE: 23 SESS: 3 OUTPUT: Thu Feb 25 10:52:08 2021

TABLE OF LEGAL INSTRUMENTS 21.160, 21.165, 21.169, 21.195, 21.201, 21.202, 21.212, 21.232, 21.233, 21.235, 21.293, 21.295, 23.07, 23.13, 24.94, 26.01, 29.01 rec 2 ........................................ 12.25, 12.112, 21.160 rec 3 .................................................................. 12.65 rec 5 ....................................................... 12.20, 21.42 rec 6 .................................................................. 12.20 rec 9 ................................................................ 21.202 rec 11 .............................................................. 12.104 rec 12 ....................................................... 4.04, 12.25 rec 13 ................................................................ 21.41 rec 14 ..... 12.14, 12.25, 12.114, 12.196, 21.46, 21.55 rec 15 ......................... 12.122, 12.181, 21.42, 21.155 rec 16 ................................................... 12.18, 121.42 rec 17 ...................................... 12.25, 12.132, 12.215 rec 19 ..................................................... 12.47, 12.53 rec 20 ................ 12.65, 12.66, 12.91, 12.109, 12.124 rec 21 .............................................................. 12.117 rec 22 ................................................. 12.126, 12.140 rec 23 ................ 12.20, 12.22, 12.133, 21.57, 21.160 rec 24 ........................................ 12.25, 12.93, 12.196 rec 25 ................................................. 12.161, 12.189 rec 26 ...................................... 12.201, 12.203, 21.51 rec 29 .............................................................. 21.194 rec 31 .............................................................. 12.126 rec 32 ................................................... 12.26, 21.160 Art 1 ........................................... 12.06–12.09, 12.15 Art 2 .................................. 9.73, 12.10–12.22, 12.77 Art 2(1) .............. 12.07, 12.10–12.15, 12.37, 12.117, 12.208, 21.41, 21.42 Art 2(2) ........................ 11.166, 12.16–12.22, 12.181 Art 2(3) ....................................... 12.16–12.22, 21.42 Art 2(3)(a) .......................................... 12.122, 12.181 Art 2(3)(b) ........................................................ 12.20 Arts 3–15 .......................................................... 25.62 Art 3 ......... 12.06, 12.23–12.28, 12.60, 12.61, 12.88, 12.126, 12.132, 12.146, 12.181, 21.44, 21.160 Art 3(1) ........... 12.24, 12.63, 12.66, 12.100, 12.213, 21.44, 21.163 Art 3(2) ............... 12.27, 12.63, 12.65, 12.66, 12.72, 12.100, 12.108, 12.134, 12.204, 12.213, 12.215, 21.44, 21.60, 21.137 Art 4 ........................................... 12.29–12.43, 25.62 Art 4(a) ....................... 12.29, 12.30, 12.33–12.12.35 Arts 4(b)–(d) .......................................... 12.29, 12.35 Art 4(b) ............................ 12.30, 12.36–12.38, 12.39 Art 4(c) ....................................... 12.30, 12.39–12.43 Art 4(d) ....................................... 12.30, 12.39–12.43 Art 5 ............ 5.44, 12.34, 12.39, 12.44–12.53, 21.45 Art 5(b) ............................................................. 12.52 Arts 6–15 .......................................................... 12.06 Art 6 ................... 12.18, 12.54–12.86, 12.93, 12.159 Art 6(1) .... 12.56–12.74, 12.79, 12.80, 12.82, 12.83, 12.84, 12.85, 12.86, 12.90, 12.95, 21.46 Art 6(2) .. 12.11, 12.14, 12.25, 12.75–12.86, 12.114, 12.159, 21.46, 21.55, 25.63 Art 7 ......... 5.144, 12.18, 12.54, 12.57, 12.61, 12.62, 12.87–12.105, 12.129, 12.150 Art 7(1) ............... 12.88–12.99, 12.137, 21.47, 25.63 Art 7(2) ..................... 12.72, 12.100, 12.139, 12.156

rec 9 .................................................................. 10.08 rec 10 ................................................................ 10.09 rec 17 ................................................................ 10.75 rec 18 ................................................................ 10.29 rec 19 ................................................................ 10.31 rec 27 .......................................... 10.45, 10.49, 10.51 rec 28 ................................................................ 10.53 rec 29 ................................................................ 10.60 rec 30 ................................................................ 10.86 Art 1 ................................ 10.24–10.29, 25.46, 25.48 Art 1(1) ....................................... 10.24, 10.46, 25.47 Art 1(2) ....................................... 10.26, 10.85, 25.47 Art 1(3) .................................................. 10.27, 25.48 Art 1(4) .................................................. 10.28, 25.48 Art 2 ........................................... 10.30–10.32, 10.87 Art 2(1) ............................................................. 10.30 Art 2(2) ............................................................. 10.32 Art 3 ....................................................... 10.33–10.35 Art 4 ....................................................... 10.36–10.42 Art 4(1) ............................................................. 10.37 Art 4(2) ............................................................. 10.40 Art 5 ................................................................. 10.43 Art 6 ....................................................... 10.44–10.56 Art 6(1) .................................................. 10.44, 10.46 Art 6(2) .................................................. 10.52, 10.54 Art 7 ....................................................... 10.57–10.73 Art 7(1) ............................................................... 2.27 Art 8 ....................................................... 10.74–10.84 Art 8(2) .................................................. 10.76, 10.78 Art 8(3) ............................................................. 10.76 Art 9 ....................................................... 10.85–10.86 Art 10 ................................................................ 10.87 Art 11 ..................................................... 10.88–10.95 Art 12 ..................................................... 10.96–10.98 Art 13 ................................................... 10.99–10.100 Art 14 .............................................................. 10.100 Dir 2002/21 Art 1 ................................................................ 21.154 Dir 2002/58 Personal data and the protection of privacy in electronic communications ........ 12.18, 12.122, 15.02, 15.29, 15.42, 17.288, 21.162, 21.185 Art 2(b) ............................................................. 15.42 Art 2(c) ............................................................. 15.42 Art 4 ................................................................. 15.43 Art 5 ................................................................. 15.43 Art 6.1 ............................................................... 15.44 Art 9.1 ............................................................... 15.44 Art 15(1) ......................................................... 12.122 Dir 2003/4 Public access to environmental information [2003] OJ L 41/26 ..................................... 18.05 Dir 2003/98 The re-use of PSI [2003] OJ L 345/90 ............ 18.04, 18.06, 18.11, 18.13, 18.30, 18.33 Dir 2004/48 Enforcement of intellectual property rights (IPRED) [2004] OJ L157/45 ........... 1.09, 1.17, 5.44, 5.97, 5.135, 5.144, 9.73, 11.01, 11.166, 11.168, 11.170, 11.172, 11.179, 11.180, 12.01–12.242, 21.17, 21.35, 21.40–21.61, 21.89, 21.101, 21.106, 21.138, 21.154, 21.155, 21.156,

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Job: Stamatoudi_2_EU_copyright_law

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Division: TableCases

/Pg. Position: 9 /

Date: 11/2

JOBNAME: Law Prac2 - Stamatou PAGE: 24 SESS: 3 OUTPUT: Thu Feb 25 10:52:08 2021

TABLE OF LEGAL INSTRUMENTS Art Art Art Art

Art Art Art Art Art Art Art Art Art Art Art Art Art Art Art

Art Art Art Art Art Art Art Art Art Art Art Art Art

Art Art Art Art Art Art Art Art Art Art Art Art Art Art Art Art

Art 20 ................................................. 12.240–12.241 Art 20(2) ............................................ 12.234, 12.240 Art 21 .............................................................. 12.242 Art 22 .............................................................. 12.242 Dir 2006/24 Data Retention ................. 21.166, 21.185 Art 3 ................................................................ 21.166 Art 4 ................................................................ 21.166 Art 5 ................................................................ 21.166 Art 11 .............................................................. 21.166 Art 15(1) ......................................................... 21,166 Dir 2006/115 Rental and Lending Rights (replacing Dir 92/100) ... 1.08, 1.15, 5.70, 6.01–6.107, 7.45, 7.46, 7.35, 7.66, 9.24, 11.145, 11.187, 11.196, 11.198, 14.12, 16.65, 16.124 rec 2 .................................................................... 6.08 rec 3 .................................................................... 6.76 rec 5 ................................ 6.01, 6.08, 6.12, 6.53, 6.62 rec 10 .............................. 6.19, 6.26, 6.27, 6.60, 6.74 rec 11 ....................................................... 6.31, 17.95 rec 12 ....................................................... 6.64, 14.02 rec 15 .................................................................. 6.53 rec 16 .................................................................. 6.83 Art 1 ........... 3.09, 6.09–6.22, 6.66, 6.73, 8.31, 17.95 Art 1(2) ............................................................... 5.70 Art 1(3) ............................................................. 12.14 Art 2 ..... 6.23–6.42, 6.65, 8.27, 11.53, 11.203, 13.17 Art 2(1)(b) ................................................. 6.31, 6.32 Art 2(2) ................................. 6.35, 6.40, 6.105, 8.27 Art 2(5) ............................................................... 7.50 Art 2(7) ............................................................... 7.49 Art 3 ...................... 5.73, 6.18, 6.43–6.54, 8.27, 8.31 Art 3(1)(c) ........................................................... 6.39 Art 3(1A) ............................................................ 6.43 Art 3(1B) ............................................................ 6.43 Art 3(2) .................................................. 6.43, 11.203 Art 3(3)–(6) ........................................................ 6.62 Art 3(3) ............................................................... 6.43 Art 3(4)–(6) ........................................................ 6.39 Art 3(4) ............................................................... 6.51 Art 3(5) ............................................................... 6.52 Art 3(6) ............................................................... 6.80 Art 4 ........................................ 5.73, 6.55–6.57, 6.58 Art 5 ...................................... 6.08, 6.58–6.64, 25.43 Art 5(3) ............................................................. 14.02 Art 5(4) ............................................................... 6.64 Arts 6–8 .......................................................... 11.203 Art 6 ...................... 6.08, 6.13, 6.33, 6.65–6.74, 7.48 Art 6(2) ............................................................... 6.57 Art 6(3) ............................................................... 6.32 Art 7 ............................. 6.77–6.82, 6.101, 7.48, 9.10 Art 7(1) ............................................................... 6.79 Art 7(2) ............................................................. 6.101 Art 7(3) ............................................................. 6.101 Art 8 ............................. 6.37, 6.83–6.98, 6.101, 7.48 Art 8(1) ................................... 6.84, 6.96, 7.36, 7.48 Art 8(2) ............ 6.84, 6.85, 6.87, 7.36, 11.21, 11.24, 11.27, 11.96 Art 8(3) .................................................... 7.36, 25.42 Art 9 .............. 6.82, 6.99–6.102, 6.104, 11.42, 11.46 Art 9(1) ............................................................. 6.101

7(3) ........................................................... 12.101 7(4) ................................. 12.100, 12.102–12.104 7(5) ........................................................... 12.105 8 ....... 11.63, 11.180, 12.26, 12.54, 12.80, 12.83, 12.93, 12.106–12.128, 21.48, 21.55, 21.56, 21.164, 21.166, 21.247, 21.293 8(1) .......... 12.11, 12.25, 12.109–12.115, 12.119, 12.127, 21.55, 25.63 8(1)(c) ............................................ 12.128, 21.48 8(1)(d) ........................................................ 12.11 8(2) .............................................. 12.116, 12.126 8(2)(a) ....................................................... 12.116 8(3) ...................... 12.114, 12.117–12.126, 25.63 8(3)(a) .............................. 12.116, 12.117, 21.48 8(3)(b)–(e) ................................................ 12.118 8(3)(b) ...................................................... 12.119 8(3)(c) ....................................................... 12.120 8(3)(d) ...................................................... 12.121 8(3)(e) .............................. 12.127, 12.128, 21.48 9 ..... 5.144, 12.26, 12.57, 12.62, 12.129–12.159, 12.173, 12.176, 21.57 9(1) .................................................. 12.71, 25.63 9(1)(a) .............. 12.129, 12.134, 12.142, 12.143, 12.145, 12.146, 12.147, 12.151, 12.169, 12.174, 21.49, 21.57 9(1)(b) ................... 12.71, 12.88, 12.148, 12.150 9(2) ......... 12.11, 12.25, 12.114, 12.130, 12.151, 12.155, 21.51, 21.55, 25.63 9(3) ................................... 12.62, 12.131, 12.135 9(4) ................................................ 12.137, 21.51 9(5) ........................................................... 12.141 9(6) .............................................. 12.139, 12.156 9(7) ........................................................... 12.140 10 ........ 12.150, 12.160–12.168, 12.184, 12.185, 12.186, 21.50, 25.63 10(1) ......................................................... 12.162 10(1)(a)–(c) ............................................... 12.164 10(2) ......................................................... 12.163 10(3) ......................................................... 12.187 11 .......... 11.192, 12.26, 12.129, 12.134, 12.143, 12.145, 12.146, 12.168, 12.169–12.183, 12.184, 12.185, 12.186 11(2) ......................................................... 11.192 11 ............................ 21.49, 21.57, 21.162, 25.63 12 ........... 12.168, 12.184–12.191, 12.196, 25.63 13 ........ 12.161, 12.168, 12.192–12.205, 12.210, 21.51, 25.63 13(1) ............................................ 12.196–12.204 13(1)(a) ........................... 12.198–12.200, 12.201 13(1)(b) ............. 12.197, 12.198, 12.201–12.204 13(2) ............................... 12.193, 12.199, 12.205 14 .......... 12.154, 12.203, 12.206–12.218, 21.52, 21.61 15 ...................... 12.154, 12.212, 12.219–12.225 16 ........................ 11.179, 12.06, 12.226–12.228 17 .................................... 12.229–12.232, 21.194 18 ...................................... 12.233–12.238, 21.53 18(1) ......................................................... 12.233 18(2) ......................................................... 12.233 19 .............................................................. 12.239

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Job: Stamatoudi_2_EU_copyright_law

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Division: TableCases

/Pg. Position: 10 /

Date: 11/2

JOBNAME: Law Prac2 - Stamatou PAGE: 25 SESS: 5 OUTPUT: Thu Feb 25 10:52:08 2021

TABLE OF LEGAL INSTRUMENTS rec 5 .................................................................... 5.35 rec 7 .................................................................... 5.17 rec 8 .................................................................... 5.34 rec 10 .................................................................. 5.24 rec 11 ................................................ 5.24, 5.28, 5.29 rec 12 ......................................................... 5.70, 5.73 rec 13 ..................................................... 5.105, 5.106 rec 14 ................................................................ 5.112 rec 15 ................................................................ 5.131 rec 16 ................................................................ 5.157 rec 17 ................................................................ 5.146 rec 19 ......................................................... 5.95, 5.99 rec 50 ................................................................ 5.141 Arts 1–6 ............................................................ 25.44 Art 1 .................................... 5.06, 5.24, 5.141, 13.15 Art 1(b) ............................................................. 17.45 Art 1(1) ............................................. 5.06–5.13, 5.22 Art 1(2) ........................................... 5.14–5.32, 5.113 Art 1(3) ...................................................... 5.33–5.39 Art 1(4) ...................................................... 5.40–5.41 Art 2 ........................................................... 5.42–5.56 Art 2(1) ...................................................... 5.42–5.45 Art 2(1)(1) .......................................................... 9.18 Art 2(2) ...................................................... 5.46–5.48 Art 2(3) ...................................................... 5.49–5.56 Art 2(5) ............................................................... 5.37 Art 2(8) ............................................................... 5.37 Art 3 ................................................................... 5.57 Art 4 ................................................. 5.58–5.97, 9.20 Art 4(a) ...................................................... 5.30, 5.92 Art 4(c) ......................................... 5.73, 11.45, 11.53 Art 4(1) .............................................. 17.153, 17.191 Art 4(1)(a) ......................... 5.61, 5.67, 5.118, 17.164 Art 4(1)(b) ...................................... 5.65–5.68, 5.118 Art 4(1)(c) ....................................... 5.69–5.75, 11.42 Art 4(2) ... 3.09, 3.13, 5.76–5.97, 6.55, 11.37, 11.38, 11.48, 11.49 Art 5 ............................................... 5.98–5.114, 9.58 Art 5(1) .......... 3.13, 5.100, 5.108, 5.147, 9.27, 9.59, 11.38 Art 5(2) ............................. 5.100, 5.110, 5.147, 9.27 Art 5(3) .................. 5.100, 5.113, 5.119, 5.147, 9.27 Art 6 ..... 5.98, 5.100, 5.115–5.133, 5.147, 9.27, 9.58 Art 6(1) ............................................................. 5.121 Art 6(1)(a) ......................................................... 5.122 Art 6(1)(b) ............................................. 5.123–5.124 Art 6(1)(c) ......................................................... 5.125 Art 6(2) .................................................. 5.126–5.130 Art 6(3) .................................................. 5.131–5.133 Art 7 .................................. 5.134–5.144, 9.73, 12.17 Art 7(1) ............................................................. 5.134 Art 7(1)(a) .............................................. 5.136–5.138 Art 7(1)(b) ........................................................ 5.139 Art 7(1)(c) ................................. 5.140–5.142, 11.127 Art 7(2) ..................................... 5.134, 5.143, 11.165 Art 7(3) .................................................. 5.134, 5.143 Art 8 ......................... 5.10, 5.98, 5.145–5.147, 13.77 Art 9 ............................................. 5.148–5.149, 9.83 Art 9.1.2 ............................................................ 16.92 Art 10 ................................................................ 5.150

Art 9(1)(b) ........................................... 6.102, 11.170 Art 9(1)(d) ........................................................ 6.101 Art 9(2) ............................................................... 6.99 Art 9(4) ............................................................. 6.101 Art 10 ......................... 6.77, 6.103–6.104, 7.47, 7.48 Art 10(1)(a) ....................................................... 6.104 Art 10(2) ........................................................... 6.104 Art 11 .................................................. 6.105, 11.170 Art 11(4) ............................................................. 6.41 Art 11(5) ............................................................. 6.41 Art 11(7) ............................................................. 6.41 Art 12 ................................................................ 6.106 Art 13 .................................................. 6.107, 11.170 Art 13(4) ............................................................. 7.56 Art 13(7) ............................................................. 7.57 Art 14 ..................................... 6.107, 11.194, 11.203 Art 14(3) ............................................................. 6.42 Art 15 ................................................................ 6.107 Art 16 ................................................................ 6.107 Dir 2006/116 Term of protection (codifying Dir 93/98, last amended by Dir 2011/77) .......... 1.08, 2.26, 8.12, 8.28, 8.85, 9.10, 10.74, 10.75, 11.196, 11.200, 13.30, 29.01 rec 10 .................................................................. 8.68 rec 11 .................................................................. 8.37 rec 16 ......................................................... 8.56, 8.59 rec 17 .................................................................. 8.38 rec 18 .................................................................. 8.42 rec 19 ......................................................... 8.43, 8.54 rec 20 .................................................................. 8.66 rec 24 .................................................................. 8.76 rec 25 .................................................................. 8.76 Arts 1–2 ............................................................ 13.29 Art 1(1) ............................................................. 25.55 Art 1.2 ............................................................... 25.56 Art 1(3) .................................................. 13.30, 25.56 Art 1.5 ............................................................... 25.56 Art 1.7 ............................................................... 25.56 Art 2 ............................................. 8.31, 13.17, 25.56 Art 2(1) ............................................................... 6.42 Art 3 ...................................................... 25.58, 25.60 Art 3(1) .................................................... 8.39, 25.61 Art 3.2 ............................................................... 25.60 Art 3.2a ............................................................. 25.60 Art 3(3) .................................................. 13.17, 25.59 Art 3.4 ............................................................... 25.59 Art 4 ......................................... 17.220, 22.57, 25.57 Art 5 .................................................... 17.220, 25.57 Art 6 ........................................... 8.59, 17.218, 22.55 Art 13 ......................................................... 8.86–8.87 Art 14 ................................................................. 8.88 Dir 2006/123 Services in the internal market ..... 12.42, 14.28 Dir 2007/74 Art 6 ................................................................. 21.75 Dir 2009/24 Computer Programs/Software (Legal protection of computer programs), codifying Dir 91/250 ........... 1.07, 1.15, 5.01–5.133, 6.55, 9.19, 9.58, 12.02, 16.62, 16.65, 16.124, 21.35 rec 4 .................................................................... 5.35

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Job: Stamatoudi_2_EU_copyright_law

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Division: TableCases

/Pg. Position: 11 /

Date: 11/2

JOBNAME: Law Prac2 - Stamatou PAGE: 26 SESS: 3 OUTPUT: Thu Feb 25 10:52:08 2021

TABLE OF LEGAL INSTRUMENTS rec 14 ................................................................ 13.37 rec 18 ................................................... 11.123, 13.65 rec 20 .................... 13.09, 13.11, 13.12, 13.17, 13.67 rec 21 ................................................................ 13.09 rec 22 ................................................................ 13.67 rec 24 .......................................... 13.24, 13.75, 14.02 Art 1 ........................................... 13.01–13.26, 13.83 Art 1(1) ........................... 13.08, 13.17, 22.85, 22.87 Art 1(2) .................................................. 13.13, 13.16 Art 1(2)(a) ............................................. 13.14, 13.15 Art 1(2)(b) ........................................................ 13.15 Art 1(2)(c) ......................................................... 13.18 Art 1(3) ............................................................. 13.22 Art 1(4) ............................................................. 13.16 Art 1(5) ............................................................. 13.24 Art 2 ......... 13.17, 13.27-13.32, 13.33, 13.64, 22.27, 22.78 Art 2(1) ............................................................. 13.28 Art 2(2) ............................................................. 13.31 Art 2(4) ............................................................. 13.32 Art 2(5) ............................................................. 13.30 Art 3 ........................................... 13.28, 13.33–13.58 Art 3(1) ................................................ 17.174, 22.85 Art 3(2) .................................................. 13.38, 22.85 Art 3(3) ....................................... 13.43, 13.63, 22.85 Art 3(4) .................................................. 13.44, 22.85 Art 3(6) .................................................. 13.46, 22.92 Art 4 ................................ 13.59–13.62, 22.86, 29.12 Art 5 .......... 13.32, 13.59, 13.63–13.65, 13.78, 22.86 Art 6 .................... 11.04, 13.09, 13.19, 13.22, 13.65, 13.66–13.74, 22.87 Art 6(2) .................................................. 13.71, 13.72 Art 6(4) ............................................................. 13.68 Art 6(5) ..................................... 11.122, 13.73, 22.86 Art 7 ....................................................... 13.75–13.77 Art 8 ................................................................. 13.78 Art 8(2) ............................................................. 13.78 Art 9 ................................ 13.05, 13.79–13.81, 22.88 Art 10 .............................. 13.05, 13.21, 13.82–13.84 Art 11 ................................................................ 13.84 Art 12 ................................................................ 13.84 Annex ......................................... 13.16, 13.20, 14.02 Dir 2013/37 The re-use of public sector information, imposing the marginal cost as a general fee, with some exceptions (amending Dir 2003/98) [2013] OJ L 175/1 .... 18.04, 18.06, 18.12, 18.13, 18.30, 23.08 rec 24 ................................................................ 18.32 Dir 2014/26 Collective Rights Management (CRM) [2013] ECR 1-000 .................. 1.09, 1.17, 11.01, 14.01–14.84, 17.188, 17.190, 17.210, 17.278, 23.09, 23.10, 25.54, 25.78, 26.01, 29.01 rec 7 .................................................................. 14.06 rec 8 .................................................................. 14.06 rec 9 .................................................................. 14.10 rec 10 ................................................................ 14.10 rec 11 ................................................................ 14.11 rec 12 ..................................................... 14.12, 23.10 rec 13 ................................................................ 14.12 rec 14 ................................................................ 14.14

Art 11 ..................................................... 5.150–5.151 Art 12 ..................................................... 5.152–5.153 Dir 2009/140 Universal Service Dir (amending Dirs 2002/21, 2002/19 and 2002/20) OJ L 337/37 ........................................... 11.177, 21.153 Dir 2010/13 Audiovisual Media Services Directive (Coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the provision of audiovisual media services) [2010] OJ L 95/1 .............................................................. 15.02 rec 33 ................................................................ 15.06 rec 41 ................................................................ 15.06 rec 43 ................................................................ 15.06 rec 56 ................................................................ 15.02 rec 76 ................................................................ 15.02 Art. 1 ................................................................ 15.01 Art 1(a) ............................................................. 15.14 Art 1(e) ............................................................. 15.14 Art 1(g) ............................................................. 15.14 Art 3 ................................................................. 15.02 Art 8 ................................................................. 15.02 Dir 2011/77 Term of protection (replacing Directive 93/98) .... 1.08, 1.15, 8.12, 8.18, 8.19, 8.39, 8.40, 8.44–8.51, 8.77–8.78, 10.74, 11.196, 11.200, 25.58, 25.60 rec 5 .................................................................... 8.40 rec 6 .................................................................... 8.44 recs 9–12 ............................................................. 8.50 rec 12 .................................................................. 8.50 recs 13–14 ........................................................... 8.51 rec 15 .................................................................. 8.79 rec 16 .................................................................. 8.80 rec 18 .................................................................. 8.18 rec 19 .................................................................. 8.80 Art 1 ................................................................. 25.56 Art 2 ................................................................... 8.87 Art 2(e) ............................................................... 8.51 Art 3 ................................................................... 8.82 Art 3(1) ............................................................... 8.87 Art 3(2) ...................................................... 8.47, 8.50 Art 5 ................................................................... 8.88 Art 9 ................................................................ 11.194 Art 10(5) ............................................................. 8.80 Dir 2011/83 Consumer rights .............................. 14.20 Dir 2012/28 Orphan works .... 1.09, 6.67, 11.01, 11.04, 11.75, 13.01–13.84, 14.01, 14.63, 16.62, 16.124, 17.169, 17.173, 17.239, 18.22, 18.33, 21.115, 22.27, 22.28, 22.83–22.89, 22.118, 23.07, 23.08, 26.01, 29.01 rec 2 .................................................................. 13.05 rec 3 .................................................................. 13.05 rec 4 ............................................ 13.24, 13.25, 14.02 rec 5 .......................................... 13.25, 22.04, 22.100 rec 8 .................................................................. 13.59 rec 9 .................................................................. 22.82 rec 10 ................................................................ 13.18 rec 11 ................................................................ 13.18 rec 12 ................................................................ 13.22 rec 13 ................................................................ 13.36

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JOBNAME: Law Prac2 - Stamatou PAGE: 27 SESS: 3 OUTPUT: Thu Feb 25 10:52:08 2021

TABLE OF LEGAL INSTRUMENTS Art 21 ..................................................... 14.61–14.63 Art 22 ..................................................... 14.61–14.63 Arts 23–28 ........................................................ 14.69 Arts 23–32 (Title III) ..... 14.13, 14.65, 15.07, 15.08 Art 23 ......................................... 14.64–14.66, 14.67 Art 24 ..................................................... 14.67–14.68 Art 25 ..................................................... 14.67–14.68 Art 26 ..................................................... 14.67–14.68 Art 27 ..................................................... 14.67–14.68 Art 28 ..................................................... 14.67–14.68 Arts 29–31 ........................................................ 14.69 Art 29 ..................................................... 14.69–14.71 Art 29(2) ........................................................... 14.40 Art 30 ......................................... 14.69–14.71, 29.16 Art 31 ......................................... 14.69–14.71, 29.16 Art 32 .................................................... 14.72, 15.07 Arts 33–38 (Title IV) ....................................... 14.13 Art 33 ......................................... 14.40, 14.73–14.74 Art 34 ..................................................... 14.73–14.74 Art 35 ..................................................... 14.73–14.74 Art 36 ......................................... 14.13, 14.75–14.78 Art 36(2) ........................................................... 14.75 Art 37 ..................................................... 14.75–14.78 Art 38 .................................................... 14.75, 14.79 Art 39 ................................................................ 14.79 Art 40 ..................................................... 14.80–14.81 Art 41 ..................................................... 14.80–14.81 Art 42 ................................................................ 14.82 Art 43 ..................................................... 14.83–14.84 Art 44 ..................................................... 14.83–14.84 Art 45 ..................................................... 14.83–14.84 Dir 2014/104 Competition Damages (on certain rules governing actions for damages under national law for infringements of the competition law provisions of the Member States and of the European Union), OJ L 349/1 Art 5(2) ............................................................. 12.60 Dir 2015/1535 Procedure for the provision of information in the field of technical regulations and of rules on Information Society services Art 1(1) ............................................................. 17.27 Art 1(1)(b) ...................................................... 17.229 Annex I ............................................................. 17.27 Dir 2015/2436 Art 10(4) ........................................................... 21.78 Dir 2016/943 Trade secrets, OJ L 157/1 ............ 12.09, 12.19, 18.04 rec 13 ................................................................ 12.09 rec 39 ..................................................... 12.09, 21.41 Dir 2017/1554, OJ L242/6 ................................... 26.01 Dir 2017/1564 Marrakesh Treaty Dir (MTD) (Certain permitted uses of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled) ......... 1.09, 4.20, 11.01, 11.04, 11.74, 16.18, 16.20–16.143, 16.153, 17.239, 23.20, 29.01 rec 3 .................................................................. 16.40 rec 6 ....................................................... 16.61, 16.65 rec 7 ............................................ 16.45, 16.56, 16.57

rec 15 ................................................................ 14.14 rec 16 ................................................................ 14.14 rec 19 ..................................................... 14.31, 14.32 rec 20 ..................................................... 14.18, 14.39 rec 21 ................................................................ 14.40 rec 22 ..................................................... 14.19, 14.24 rec 23 ................................................................ 14.43 rec 24 ................................................................ 14.44 rec 25 ................................................................ 14.45 rec 26 ................................................................ 14.47 rec 27 ................................................................ 14.48 rec 28 ................................................................ 14.49 rec 29 ................................................................ 14.50 rec 30 ................................................................ 14.53 rec 31 ................................................................ 14.54 rec 32 ................................................................ 14.58 rec 33 ................................................................ 14.60 rec 40 ................................................................ 14.82 rec 48 ................................................................ 14.72 rec 49 ................................................................ 14.73 rec 50 ............................... 14.75, 14.76, 14.77, 14.78 rec 52 ................................................................ 14.82 rec 57 ................................................................ 14.80 rec 58 ................................................................ 14.82 Arts 1–3 (Title I) .............................................. 14.13 Art 1 ....................................................... 14.09–14.12 Art 2 ........................................... 14.09, 14.13–14.14 Art 3 ........................................... 14.14, 14.15–14.22 Art 3(i) .............................................................. 14.49 Arts 4–10 .......................................................... 14.23 Arts 4–22 (Title II) .......................................... 14.13 Art 4 ....................................................... 14.24–14.27 Art 5 ....................................................... 14.28–14.37 Art 5(2) .................................................. 14.33, 14.37 Art 5(3) ............................................................. 14.33 Art 5(7) ............................................................. 14.36 Art 6 ....................................................... 14.38–14.39 Art 6(4) ............................................................. 14.40 Art 6(5) ............................................................. 14.39 Art 7 ......................................... 14.38, 14.40, 17.210 Art 8 ................................ 14.24, 14.41–14.43, 14.44 Art 9 ....................................................... 14.44–14.45 Art 10 ..................................................... 14.44–14.45 Arts 11–13 .................................. 14.23, 14.46–14.50 Art 11 ................................................................ 14.47 Art 11(2) ........................................................... 14.48 Art 12 ................................................................ 14.49 Art 12(1) ........................................................... 14.49 Art 13 ................................................................ 14.50 Art 14 ......................................... 14.23, 14.51–14.53 Art 15 ......................................... 14.23, 14.51–14.53 Arts 16–17 ........................................................ 14.23 Art 16 ..................................................... 14.54–14.59 Art 16(2) ........................................................... 14.58 Art 16(3) ........................................................... 14.59 Art 17 ................................................................ 14.60 Arts 18–22 .................................. 14.23, 14.62, 25.78 Art 18 ........................................ 14.61–14.63, 17.278 Art 19 ..................................................... 14.61–14.63 Art 20 ......................................... 14.40, 14.61–14.63

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Date: 11/2

JOBNAME: Law Prac2 - Stamatou PAGE: 28 SESS: 3 OUTPUT: Thu Feb 25 10:52:08 2021

TABLE OF LEGAL INSTRUMENTS Rec 5 ................................................................... 6.85 Rec 7 ................................................................. 20.06 Rec 9 ................................................................. 20.16 Rec 15 ................................................................. 6.85 Rec 20 ............................................................... 20.27 Rec 21 ...................................................... 7.31, 20.28 Art 1 ................................................................. 20.07 Art 2 ....................................................... 20.08–20.10 Art 2.4 ................................................................ 7.11 Art 3(1) ............................ 20.05, 20.11–20.16, 29.11 Art 3(2) ............................................................. 20.17 Art 3(3) ............................................................. 20.18 Art 4 ........................................... 20.19–20.22, 20.23 Art 4(2) ............................................................. 20.21 Art 5 ...................................................... 20.19, 20.23 Art 6 ........................................................ 7.77, 20.24 Art 7 ................................................................. 20.25 Art 8 ....................................................... 20.26–20.29 Art 8.1 ................................................... 20.28, 20.29 Art 8.2 ............................................................... 20.29 Art 9 ........................................................ 7.31, 20.30 Art 10 ................................................................ 20.31 Art 11 ................................................................ 20.32 Art 12 ................................................................ 20.32 Art 13 ................................................................ 20.32 Art 14 ................................................................ 20.32 Dir 2019/790 Copyright in the Digital Single Market (DSM) Directive (amending Dirs 96/9 and 2001/29) ......... 1.09, 1.18, 4.77, 6.08, 7.77, 9.30, 9.67, 11.01, 11.04, 11.71, 11.74, 11.75, 11.102, 11.104, 11.173, 11.206, 12.181, 13.10, 13.24, 13.69, 13.70, 13.77, 16.62, 17.01–17.289, 21.35, 21.137, 21.138, 21.186–21.193, 21.294, 23.21, 23.24, 26.01, 29.01, 30.02, 30.03, 30.05 rec 3 ..................................................... 17.01, 17.116 rec 5 ........................................ 17.113, 17.116, 22.67 rec 6 ................................................................ 17.125 recs 8–11 ......................................................... 17.114 rec 11 ..................................................... 17.06, 22.68 rec 12 ................................................................ 17.05 rec 13 .......................................... 17.07, 17.23, 22.68 rec 14 .............................................................. 17.124 rec 15 .............................................................. 17.129 rec 16 .............................................................. 17.132 rec 17 .............................................................. 17.127 rec 18 ................................................. 17.136, 17.144 rec 19 ................................................. 17.151, 17.151 rec 20 .............................................................. 17.151 rec 21 .............................................................. 17.152 rec 22 .............................................................. 17.154 rec 23 .............................................................. 17.156 rec 24 .............................................................. 17.159 rec 25 ................................................................ 22.67 rec 26 .............................................................. 17.160 rec 27 .................................... 17.160, 17.162, 17.163 rec 29 ................................................. 17.161, 17.181 rec 31 .............................................................. 17.188 rec 32 .............................................................. 17.192 rec 34 .............................................................. 17.191 rec 35 ................................................. 17.195, 17.196

rec 8 .................................................................. 16.73 rec 9 ...................... 16.54, 16.58, 16.69, 16.91, 16.95 rec 11 ...................................... 16.98, 16.119, 16.120 rec 12 .............................................................. 16.108 rec 13 ..................................................... 16.60, 16.83 rec 14 ................ 16.77, 16.79, 16.81, 16.106, 16.157 rec 15 .............................................................. 16.122 rec 17 ................................................................ 16.35 rec 18 ................................................................ 16.35 rec 19 .............................................................. 16.130 rec 20 .............................................................. 16.128 rec 21 ..................................................... 16.32, 16.36 rec 22 ................................................... 16.39, 16.144 rec 23 ..................................................... 16.41, 16.42 rec 24 .............................................................. 16.139 Art 1 ....................................................... 16.29–16.42 Art 2 ......................................... 16.43–16.60, 16.145 Art 2(1) ............................................................. 16.45 Art 2(2) ............................................................. 16.52 Art 2(2)(b) ........................................................ 16.53 Art 2(2)(c) ......................................................... 16.53 Art 2(3) ............................................................. 16.56 Art 2.4 ................................................... 16.59, 16.60 Art 3 ............... 16.61–16.97, 16.155, 15.157, 16.160 Art 3.1(a) .......................................................... 16.72 Art 3.1(b) ........................................................ 16.103 Art 3.2 ............................................................... 16.73 Art 3.3 ............................................................... 16.74 Art 3(4) ........................... 16.84, 16.86, 16.87, 16.94 Art 3(5) .... 16.84, 16.91, 16.92, 16.93, 16.94, 16.95, 16.97 Art 3(6) ................................... 16.76, 16.105, 16.106 Art 4 ... 16.51, 16.83, 16.98–16.107, 16.155, 16.157, 16.160, 29.05 Art 5 ........................ 16.107, 16.108–16.118, 16.145 Art 5.1 ............................................................. 16.111 Art 5.2 ............................................... 16.116, 16.142 Art 5.2(b) ........................................................ 16.116 Art 6 ................................................... 16.119–16.121 Art 6.1 ............................................................. 16.142 Art 7 ........................ 16.116, 16.122–16.123, 16.145 Art 8 ........................................ 16.88, 16.124–16.129 Art 9 ................................................... 16.130–16.133 Art 10 .................................... 16.134–16.137, 16.145 Art 10.2 ........................................................... 16.133 Arts 11–12 ...................................................... 16.145 Art 11 ................................................. 16.138–16.143 Art 12 .............................................................. 16.143 Art 13 .............................................................. 16.143 Dir 2018/1972 European Electronic Communications Code ............................................... 17.31, 17.258 Dir 2019/789 SatCab/NetCab/RTV Directive (laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes) [2019] OJ L 130/82 ..... 1.09, 7.04, 7.05, 7.16, 7.31, 7.77, 7.88, 20.01–20.32, 23.23, 29.01, 30.02 Rec 1 ................................................................. 20.05

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Date: 11/2

JOBNAME: Law Prac2 - Stamatou PAGE: 29 SESS: 3 OUTPUT: Thu Feb 25 10:52:08 2021

TABLE OF LEGAL INSTRUMENTS rec rec rec rec rec rec rec rec rec rec rec rec rec rec rec rec rec rec rec rec rec

Art 8(1) ..... 17.180, 17.183, 17.188, 17.197, 17.201, 17.205, 17.206, 17.207, 17.208 Art 8(2) ..... 17.180, 17.183, 17.187, 17.194, 17.197, 17.204, 17.205, 17.206, 17.207 Art 8(3) ........................................................... 17.187 Art 8(4) .................... 17.194, 17.195, 17.197, 17.206 Art 8(5) ................................... 13.36, 17.172, 17.201 Art 8(7) ........................................................... 17.182 Art 9 .......................... 17.24, 17.167, 17.203–17.204 Art 9(1) ........................................................... 17.188 Art 10 ........... 17.24, 17.167, 17.194, 17.205–17.207 Art 10(1) ............................................ 17.184, 17.205 Art 10(2) ......................................................... 17.207 Art 11 ............. 13.38, 17.24, 17.167, 17.201, 17.208 Art 12 ............... 4.77, 14.02, 17.209–17.213, 17.254 Art 12(1) ......................................................... 17.210 Art 12(2) ......................................................... 17.211 Art 12(3) ......................................................... 17.211 Art 12(4) ......................................................... 17.210 Art 12(5) ......................................................... 17.213 Art 12(6) ......................................................... 17.213 Art 13 ........................................ 7.77, 17.214–17.216 Art 14 ...................................... 17.217–17.223, 18.18 Arts 15–17 ........................................................ 29.06 Art 15 ... 6.61, 17.25, 17.224–17.247, 21.192, 23.21, 29.06 Art 15(1) .... 17.120, 17.122, 17.123, 17.153, 17.164 Art 15(2) ......................................................... 17.240 Art 15(5) ......................................................... 17.242 Art 16 ...................................................... 6.61, 23.21 Art 16(1) ............................... 17.243, 17.248–17.249 Art 16(2) ............................................................. 6.69 Art 17 .......... 11.29, 12.181, 17.214, 17.250–17.273, 17.289, 19.01–19.34, 21.139, 21.187, 21.188, 21.190, 23.21, 23.37, 29.06 Art 17(1) ............................... 17.250, 17.253, 17.257 Art 17(2) .............................................. 17.255, 19.20 Art 17(3) .............................................. 19.24, 21.139 Art 17(4) ..... 17.259, 17.262, 17.263, 17.266, 19.22, 19.30 Art 17(4)(a) ........................................ 17.259, 17.263 Art 17(4)(b) ....................................... 17.260, 17.266 Art 17(4)(c) ........................................ 17.261, 17.266 Art 17(5) .............................................. 17.262, 19.29 Art 17(6) .............................................. 17.263, 19.28 Art 17(7) ....... 17.264, 17.266, 17.267, 19.30, 19.34, 21.191 Art 17(8) .............................................. 17.266, 19.23 Art 17(9) ....... 17.267, 17.268, 17.272, 19.30, 19.33, 19.34 Art 17(10) ..................... 17.273, 19.23, 19.30, 19.34 Arts 18–22 .......................................................... 6.61 Arts 18–23 .................................... 1.18, 29.06, 29.08 Art 18 ................................................. 17.274–17.275 Arts 19–21 ...................................................... 17.284 Art 19 ................................................. 17.276–17.279 Art 20 .............................................................. 17.279 Art 20(1) ......................................................... 17.277 Art 20(2) ......................................................... 17.279 Art 21 .............................................................. 17.280

36 37 38 39 40 41 42 48 49 51 52 53 54 55 56 57 58 59 60 61 62

.............................................................. 17.193 .................................... 17.174, 17.179, 17.200 .............................................................. 17.175 .............................................................. 17.182 ................................................. 17.189, 17.203 ....................... 17.195, 17.197, 17.205, 17.207 .................................... 17.201, 17.202, 17.208 .............................................................. 17.212 .............................................................. 17.210 .............................................................. 17.214 .............................................................. 17.216 ....................... 17.217, 17.221, 17.222, 17.223 ................................................. 17.224, 17.227 .................................... 17.224, 17.231, 17.235 ...................................... 17.26, 17.229, 17.230 .............................................................. 17.239 .............................................................. 17.238 ................................................. 17.240, 17.242 .................................... 17.246, 17.248, 17.249 ................................................. 17.253, 17.254 ............... 17.28, 17.32, 17.33, 17.250, 17.257, 17.258, 17.259, 19.27 rec 63 .............................................................. 17.257 rec 66 ................................................... 17.260, 19.21 rec 69 .............................................................. 17.256 rec 70 ...................................... 17.264, 17.266, 19.30 rec 73 .............................................................. 17.275 recs 75–77 ....................................................... 17.276 rec 78 .............................................................. 17.279 rec 79 .............................................................. 17.280 rec 80 .............................................................. 17.281 rec 81 .............................................................. 17.284 Art 1 ................................................................. 17.03 Art 1(1) ............................................................. 17.01 Art 1(2) .................................................. 17.02, 18.24 Art 2 ... 17.04–17.33, 17.38, 17.124, 17.164, 17.183, 18.33 Art 2(6) .......... 11.173, 17.257, 19.25, 19.26, 21.190 Arts 3–6 .................................... 17.166, 22.66, 23.21 Art 3 ..... 4.77, 17.24, 17.34–17.134, 17.135, 17.136, 17.138, 17.140, 17.142, 17.146, 17.148, 17.165, 29.05 Art 3(1) .............................................. 17.123, 17.147 Art 3(2) .............................................. 17.128, 17.147 Art 4 ...... 4.77, 17.36, 17.115, 17.135–17.150, 29.05 Art 4(2) ........................................................... 17.147 Art 4(3) .............................................. 17.144, 17.145 Art 4(4) ........................................................... 17.146 Art 5 ...................................... 17.151–17.159, 17.165 Art 5(2) ........................................................... 17.156 Art 5(3) ................................................ 17.158, 29.11 Art 5(4) ........................................................... 17.158 Art 6 .... 17.24, 17.160–17.164, 17.165, 22.68, 23.24 Art 7 ........................ 17.119, 17.153, 17.165–17.166 Art 7(1) ........................................................... 17.165 Art 7(2) .............................................. 17.126, 17.149 Arts 8–11 .................................. 13.24, 13.25, 17.167 Art 8 ..... 4.77, 13.52, 17.24, 17.167–17.202, 17.203, 17.205

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TABLE OF LEGAL INSTRUMENTS Art 22 ................................................. 17.281–17.283 Art 22(1) ......................................................... 17.281 Art 22(2) ......................................................... 17.282 Art 22(3) ......................................................... 17.283 Art 22(4) ......................................................... 17.281 Art 22(5) ......................................................... 17.283 Art 23 .............................................................. 17.284 Art 24 .................................................. 17.02, 17.285 Art 25 .............................................................. 17.286 Art 26 ................................................ 17.286, 17.287 Art 26(1) ......................................................... 21.188 Art 27 .............................................................. 17.287 Art 28 .............................................................. 17.288 Art 29 ..................................... 17.12, 17.288, 17.289 Art 30 .............................................................. 17.289 Art 31 .............................................................. 17.289 Art 32 .............................................................. 17.289 Annex I ........................................................... 17.234 Sch 2(5) ............................................................. 17.13 Dir 2019/1024 Open data and the re-use of public sector information (PSI), OJ L172/56 ......... 9.35, 18.01–18.33 rec 39 ................................................................ 18.32 rec 54 ................................................................ 18.23 rec 55 ................................................................ 18.23 Art 1 ................................................................. 18.23 Art 13 ................................................................ 18.13

Other Instruments Agreement between the European Community and the Kingdom of Denmark on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters [2005] OJ L299/62 ....................................................... 21.62 Agreement establishing an Association between the European Union and its Member States and Central America, OJ L315/26.11.2013 ...... 25.29 Art 228 .................................................. 25.34, 25.35 Art 233 .............................................................. 25.36 Art 234 .............................................................. 25.55 Art 235 .................................................. 25.59, 25.60 Art 236 .............................................................. 25.53 Art 236.3 ........................................................... 25.43 Art 237.2 ........................................................... 25.40 Art 237.4 ........................................................... 25.42 Art 260 .............................................................. 25.62 Art 261 .............................................................. 25.62 Art 262 .............................................................. 25.63 Art 263 .............................................................. 25.63 Art 264 .............................................................. 25.63 Art 265 .............................................................. 25.63 Agreement establishing an Association between the European Community and its Member States and the Republic of Chile, OJ L352/30.12.2002 ......................................... 25.27 Art 168 .............................................................. 25.27 Art 170 .............................................................. 25.27 Art 171 .............................................................. 25.27

Agreement on a Unified Patent Court (UPC) Arts 25–27 ........................................................ 29.19 Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) 1994 see TRIPS Agreement Anti-Counterfeiting Trade Agreement (ACTA) 2011 ......... 12.236, 12.237, 21.02, 21.33, 21.185, 21.203, 21.208–21.252, 21.253, 21.257, 21.277, 21.289, 21.291, 23.13, 23.16 Art 1 .................................................. 21.230, 21.238 Art 2(1) .............................................. 21.229, 21.230 Art 2(3) .............................................. 21.230, 21.238 Art 3 ................................................................ 21.243 Art 3(1) ........................................................... 21.231 Art 3(2) ........................................................... 21.233 Art 5 ................................................................ 21.230 Art 5(c) ........................................................... 21.247 Art 5(h) ........................................................... 21.233 Art 8 ................................................................ 21.201 Art 8(1) ........................................................... 21.235 Art 8(2) ........................................................... 21.230 Art 9 ................................................................ 21.235 Art 10 .............................................................. 21.235 Art 11 .............................................................. 21.235 Art 12 .............................................................. 21.235 Arts 13–22 ...................................................... 21.235 Art 13 ................................................ 21.230, 21.237 Art 23 ................................... 21.239, 21.241, 21.243 Art 23(1) ......................................................... 21.240 Art 23(3) ......................................................... 21.242 Art 23(4) ......................................................... 21.242 Art 26 .............................................................. 21.242 Art 27(1) ......................................................... 21.235 Art 27(3) ............................................ 21.246, 21.257 Art 27(4) ............................... 21.235, 21.247, 21.257 Art. 27(5)–(7) ................................................. 21.235 Arts 28–34 ...................................................... 21.235 Art 40 .............................................................. 21.228 Art 43 .............................................................. 21.230 Association Agreement between the European Union and the European Atomic Energy Community and their Member States, and Georgia, OJ L 261 30.8.2014, p. 4 ...................................... 25.33 Art 150 .............................................................. 25.34 Art 153 .............................................................. 25.36 Art 154 .............................................................. 25.38 Art 155 .............................................................. 25.40 Art 156 .............................................................. 25.41 Art 157 .............................................................. 25.42 Art 157(d) ......................................................... 25.42 Art 158 .............................................................. 25.43 Art 159.1 ........................................................... 25.55 Art 159.2 ........................................................... 25.56 Art 159.3 ........................................................... 25.61 Art 159.4 ........................................................... 25.60 Art 159.5 ........................................................... 25.59 Arts 160–161 .................................................... 25.50 Art 163 .............................................................. 25.46 Art 164 .............................................................. 25.53 Art 190 .............................................................. 25.62

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TABLE OF LEGAL INSTRUMENTS Art 173(b) ......................................................... 25.40 Art 173(c) ......................................................... 25.41 Art 174.1 ........................................................... 25.38 Art 174.2(a) ...................................................... 25.40 Art 174.2(b) ...................................................... 25.41 Art 174.2(d) ...................................................... 25.42 Arts 176–177 .................................................... 25.50 Art 178.1(a) ...................................................... 25.38 Art 178.1(b) ........................................... 25.40, 25.41 Art 178.1(c) ...................................................... 25.41 Art 179 .............................................................. 25.43 Art 190 .............................................................. 25.46 Art 230 .............................................................. 25.62 Art 231 .............................................................. 25.62 Art 233 .............................................................. 25.63 Art 234 .............................................................. 25.63 Art 235 .............................................................. 25.63 Art 236–237 ...................................................... 25.63 Art 238–239 ...................................................... 25.63 Art 240 .............................................................. 25.63 Arts 244–249 .................................................... 25.64 Art 252 .............................................................. 25.35 Beijing Treaty on Audiovisual Performances 2012 ............................. 2.05, 26.02, 26.03, 26.08 Art 2b ................................................................. 6.35 Berne Convention (BC) for the Protection of Literary and Artistic Works 1886 (last amended 28 September 1979) ...... 1.04, 1.16, 2.05, 2.08, 2.13, 2.14, 2.16, 2.17, 2.28, 2.30, 2.31, 5.08–5.13, 5.37, 5.131, 5.132, 7.42, 8.41, 8.57, 8.84, 9.01, 9.29, 9.31, 11.21, 11.78, 11.119, 12.02, 12.20, 12.52, 16.67, 16.142, 16.162, 17.97, 18.20, 21.265, 24.81, 24.95, 25.13, 25.18, 25.23, 25.24, 25.25, 25.27, 25.77, 26.02, 26.12, 26.32, 26.38, 26.46 rec 6 .................................................................... 2.28 Art 2 .......................................................... 8.15, 8.56 Art 2(1) ........................... 5.17, 12.48, 13.17, 17.221 Art 2(3) ............................................................... 5.68 Art 2(4) .................................................... 9.34, 18.17 Art 2.7 .............................................. 2.17, 2.27, 8.73 Art 2bis.1 .......................................................... 18.17 Art 3 .......................................................... 2.14, 2.16 Art 4 .......................................................... 2.14, 2.16 Art 5 .................................. 5.13, 28.05, 28.11, 28.14 Art 5(1) ............................................................... 5.13 Art 5.1 ................................................................ 2.14 Art 5(2) ............ 13.46, 16.161, 16.165, 18.15, 24.83 Art 5(4) ............................................................... 8.60 Art 5(4)(c)(i) ....................................................... 2.14 Art 5(4)(c)(ii) ...................................................... 2.14 Art 6 ................................................................... 2.17 Art 6bis ...................... 1.16, 5.13, 5.95, 25.38, 29.08 Art 6bis(1) ........................................................ 22.72 Art 6bis(2) .......................................................... 8.66 Art 7 .................................. 2.15, 10.78, 25.55, 26.50 Art 7(1) ............................... 8.02, 8.04, 10.51, 10.77 Art 7(2) ............................................................... 8.30 Art 7(3) .................................................... 8.20, 13.30 Art 7(4) ............................................ 8.56, 8.57, 8.73

Art 191 .............................................................. 25.62 Art 192 .............................................................. 25.63 Art 193 .............................................................. 25.63 Art 194 .............................................................. 25.63 Art 195.2 ........................................................... 25.63 arts 195.3–195.4 ................................................ 25.63 Art 195.3 ........................................................... 25.63 Art 196 .............................................................. 25.63 Art 202 .............................................................. 25.35 Association Agreement between the European Union and the European Atomic Energy Community and their Member States, and the Republic of Moldova, OJ L 260 30.8.2014, p. 4 ........... 25.33, 25.64 Art 277 .............................................................. 25.34 Art 280 .............................................................. 25.36 Art 281 .............................................................. 25.38 Art 282 .............................................................. 25.40 Art 283 .............................................................. 25.41 Art 284 .............................................................. 25.42 Art 284(d) ......................................................... 25.42 Art 285 .............................................................. 25.43 Art 286.1 ........................................................... 25.55 Art 286.2 ........................................................... 25.56 Art 286.3 ........................................................... 25.61 Art 286.4 ........................................................... 25.60 Art 286.5 ........................................................... 25.58 Arts 287–288 .................................................... 25.50 Art 290 .............................................................. 25.46 Art 291 .............................................................. 25.53 Art 318 .............................................................. 25.62 Art 321 .............................................................. 25.63 Arts 322–323 .................................................... 25.63 Arts 324–325 .................................................... 25.63 Art 326 .............................................................. 25.63 Art 332 .............................................................. 25.35 Association Agreement between the European Union and its Member States, and Ukraine, OJ L 161/ 29.05.2014 ................................. 25.33 Art 157 .............................................................. 25.34 Art 161 .............................................................. 25.36 Art 162.1 ........................................................... 25.55 Art 162.2 ........................................................... 25.56 Art 162.4 ........................................................... 25.56 Art 163 .............................................................. 25.56 Art 164 .............................................................. 25.60 Art 164.1 ........................................................... 25.61 Art 164.3 ........................................................... 25.59 Art 164.4 ........................................................... 25.58 Art 165 .............................................................. 25.57 Art 166 .............................................................. 25.57 Art 169.2 ........................................................... 25.42 Art 169.3 ............................................... 25.40, 25.41 Art 170.2 ............................................... 25.40, 25.41 Art 170.3 ........................................................... 25.43 Art 171.1 ........................................................... 25.38 Art 171.2(a) ...................................................... 25.40 Art 171.2(b) ...................................................... 25.41 Art 171.2(d) ...................................................... 25.41 Art 173(a) ......................................................... 25.38

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TABLE OF LEGAL INSTRUMENTS Art 254 .............................................................. 25.62 Art 256.1 ........................................................... 25.63 Art 256.2 ........................................................... 25.63 Art 257 .............................................................. 25.63 Arts 258–259 .................................................... 25.63 Art 260–261 ...................................................... 25,63 Art 262 .............................................................. 25.63 Art 268 .............................................................. 25.35 Comprehensive Economic and Trade Agreement between Canada and the EU and its Member States (CETA) OJ L11/14.01.2017 ... 4.02, 9.72, 21.227, 21.255, 21.257, 25.31–25.32, 25.55, 25.64 Art 20.1 ............................................................. 25.34 Art 20.7 ............................................................. 25.36 Art 20.8 ............................................................. 25.31 Art 20.8.1 .............................................. 25.40, 25.41 Arts 20.9–20.10 ................................................ 25.50 Art 20.32 ........................................................... 25.62 Art 20.33 ........................................................... 25.62 Art 20.34 ........................................................... 25.63 Art 20.35 ........................................................... 25.63 Art 20.36 ........................................................... 25.63 Arts 20.37–20.38 .............................................. 25.63 Art 20.50 ........................................................... 25.35 Convention Establishing the World Intellectual Property Organization (WIPO) 1967 ......... 26.59 Convention for the Protection of Producers of Phonograms against the Unauthorised Duplication of their Phonograms ........ 25.27 and before Convention on Cybercrime 2001, Council of Europe ....................................................... 11.126 Art 2 ................................................................ 11.126 Art 3 ................................................................ 11.126 Art 6 ................................................................ 11.126 Convention on Mutual Assistance in Criminal Matters between the Member States of the European Union ......................................................... 21.130 Protocol ........................................................... 21.130 Cotonou Agreement Art 46 ................................................................ 25.66 Customs Union between the EU and Turkey ...... 25.22 Art 31 ................................................................ 25.22 Annex 8 ................................................. 25.22, 25.23 Doha Declaration on TRIPS and Public Health ................ 21.214, 21.222, 21.238, 21.256 Economic Partnership, Political Coordination and Cooperation Agreement between the European Community and its Member States, and the United Mexican States, Final Act – Declarations, OJ L 276, 28.10.2000, p. 45–80 ................. 25.26 Art 12.1 ............................................................. 25.26 EEA Agreement 1993, OJ L1/3, 3.1.1994 ......... 10.23, 25.79 Enhanced Partnership and Cooperation Agreement between the European Union and its Member States, and the Republic of Kazakhstan, OJ L 29, 4.2.2016 ................................................. 25.30 Art 61 ................................................................ 25.34

Art 7(5) ............................................................... 8.65 Art 7(6) ................................. 8.02, 8.04, 8.13, 10.77 Art 7.8 ....................................................... 2.17, 2.26 Art 7bis .................................................... 5.47, 25.55 Art 8 ................................................................... 4.20 Art 9(2) ....................................... 11.78, 16.04, 17.20 Art 10 ................................................................. 2.15 Art 10(1) .............................................. 11.106, 16.04 Art 10(2) ........................................................... 16.04 Art 11 ................................................................ 22.69 Article 11bis(2) ................................................... 7.37 Arts 12–14 .......................................................... 2.15 Art 14 ................................................................ 22.69 Art 14(3) ............................................................. 6.42 Art 14bis(2) ....................................................... 26.15 Art 14bis(2)(a) .................................................... 8.26 Art 14ter ............................ 2.28, 10.01, 10.25, 10.31 Art 14ter(1) ..................... 10.06, 10.50, 25.45, 25.47 Art 14ter(2) ............ 2.17, 10.58, 10.77, 25.45, 25.47 Art 15 ................................................................. 5.44 Art 15(1) ........................................................... 12.47 Art 15(2) ........................................................... 12.48 Art 15(3) ........................................................... 12.49 Art 15(4) ........................................................... 26.50 Art 18 ................................................................. 2.17 Art 20 ................................................................ 16.12 Art 30.2(b), part 2 .............................................. 2.17 App, Art II ......................................................... 4.20 Bilateral copyright agreement between Austria and Sardinia, 1840 ................................................ 2.12 Brussels Convention 1968 ......................... 21.62, 21.70 Art 8(1) ............................................................. 24.08 Art 16(4) ................................................ 24.18, 24.19 Brussels Satellite Convention .................................. 2.05 Charter of Nice 2001 Art 17.2 ............................................................... 2.04 Comprehensive and enhanced Partnership Agreement between the European Union and the European Atomic Energy Community and their Member States, and the Republic of Armenia, OJ L 23, 26.1.2018 .......................................... 25.30, 25.64 Art 209 .............................................................. 25.34 Art 212 .............................................................. 25.36 Art 213 .............................................................. 25.38 Art 214 .............................................................. 25.40 Art 215 .............................................................. 25.41 Art 216 .............................................................. 25.42 Art 216(e) ......................................................... 25.43 Art 217 .............................................................. 25.43 Art 218.1 ........................................................... 25.55 Art 218.2 ........................................................... 25.56 Art 218.5 ........................................................... 25.56 Art 218.7 ........................................................... 25.56 Art 218.8 ........................................................... 25.57 Art 218.9 ........................................................... 25.61 Art 218.11 ......................................................... 25.58 Art 218.12 ......................................................... 25.59 Arts 219–220 .................................................... 25.50 Art 222 .................................................. 25.46, 25.48 Art 223 .............................................................. 25.54

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TABLE OF LEGAL INSTRUMENTS EU-SACD (Botswana, Eswatini, Lesotho, Mozambique, Namibia and SoutAfrica) EPA ............................................................. 25.66 Art 16 ................................................................ 25.66 Art 16.1 ............................................................. 25.66 Art 16.2 ............................................................. 25.66 EU-West Africa EPA, not in force ..................... 25.69 Euro-Mediterranean Agreement establishing an association between the European Communities and their Member States and the State of Israel, OJ L 147, 21.6.2000 ................................... 25.09 Joint Declaration to article 39 .......................... 25.11 Art 39.1 ............................................................. 25.12 Art 39.2 ............................................................. 25.14 Annex VII ......................................................... 25.13 Euro-Mediterranean Agreement establishing an association between the European Communities and their Member States, and Lebanon Joint Declaration to Art 38 .............................. 25.11 Art 38 ................................................................ 25.13 Annex 2 ............................................................ 25.13 Euro-Mediterranean Agreement establishing an association between the European Communities and their Member States, and the Kingdom of Morocco, OJ L 70, 18.3.2000, p. 2–204 .... 25.09 Joint Declaration to art 39 ............................... 25.11 Art 39 ................................................................ 25.13 Anex 7 ............................................................... 25.13 Euro-Mediterranean Agreement establishing an Association between the European Communities and their Member States, and the Hashemite Kingdom of Jordan, OJ L 283, 26.10.2005, p. 10 ............................................................. 25.09 Joint Declaration to art 56 ............................... 25.11 Art 56 ................................................................ 25.13 Annex VII ......................................................... 25.13 Euro-Mediterranean Agreement establishing an Association between the European Communities and their Member States, and the Arab Republic of Egypt, OJ L 304, 30.9.2004, p. 39–208 ..................................................... 25.10 Joint Declaration to article 37 .......................... 25.11 Art 37 ................................................................ 25.13 Annex VII ......................................................... 25.13 Euro-Mediterranean Agreement establishing an Association between the European Community and its Member States, and the People’s Democratic Republic of Algeria, OJ L 265, 10.10.2005, p. 2–228 ................................... 25.10 Joint Declaration to article 44 .......................... 25.11 Art 44 ................................................................ 25.13 Annex 6 ............................................................ 25.13 Euro-Mediterranean Interim Association Agreement on trade and cooperation between the European Community and the Palestine Liberation Organization (PLO) for the benefit of the Palestinian Authority of the West Bank and the Gaza Strip, OJ L 187, 16.07.1997 ............. 25.09 Joint Declaration ............................................... 25.11 European Copyright Code ......... 11.105, 11.108, 29.24

Art 63 ................................................................ 25.35 Art 65 ................................................................ 25.36 Art 66 ................................................................ 25.38 Art 67 ................................................................ 25.40 Art 68 ................................................................ 25.41 Art 69 ................................................................ 25.42 Art 69(d) ........................................................... 25.42 Art 70 ................................................................ 25.43 Art 71 ................................................................ 25.61 Art 71.1 ............................................................. 25.55 Art 71.2 ............................................................. 25.56 Art 71.4 ............................................................. 25.60 Art 71.5 ............................................................. 25.59 Arts 72–73 ........................................................ 25.50 Art 76 ................................................................ 25.53 Art 97 ................................................................ 25.62 Art 98 ................................................................ 25.62 Art 99 ................................................................ 25.63 Art 100 .............................................................. 25.63 Art 101 .............................................................. 25.63 Arts 102–103 .................................................... 25.63 Arts 104–105 .................................................... 25.63 Art 118 .............................................................. 25.35 Art 244 .............................................................. 25.63 Art 250–254 ...................................................... 25.64 EU-Australia Trade Agreement Art X.48 .............................................................. 9.72 EU-Azerbaijan Partnership and Cooperation Agreement ................................................... 25.24 Annex II ............................................................ 25.24 EU-CARIFORM EPA (Economic Partnership Agreement between the CARIFORUM States, of the one part, and the European Community and its Member States, of the other part), OJ L 289, 30.10.2008, p. 3–1955 ............. 25.70–25.74, 25.76, 25.77 Articles 131–164 ............................................... 25.71 Art 139.1 ........................................................... 25.71 Art 139.4 ........................................................... 25.73 Art 143 .............................................................. 25.71 Art 131.2 ........................................................... 25.70 Art 140 .............................................................. 25.73 Art 143 .................................................. 25.71, 25.73 Art 143(1) ....................................................... 21.255 Arts 151–164 .................................................... 25.72 EU-China Customs Action Plan ......................... 21.87 EU-Iraq Partnership and Cooperation Agreement ................................................... 25.25 Art 20 ................................................................ 25.25 EU-Japan EPA ...................... 9.72, 25.54, 25.75–25.78 Art 14.13 ........................................................... 25.77 Art 14.16 ........................................................... 25.78 Art X.48(1) ......................................................... 9.72 EU-New Zealand Trade Agreement ...................... 9.72 EU-Pacific Interim EPA ........................... 25.65, 25.66 Art 16 ................................................................ 25.66 Art 16.1 ............................................................. 25.66 Art 16.2 ............................................................. 25.66

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TABLE OF LEGAL INSTRUMENTS Art 53 ................................................................ 25.67 Interim EPA between the EU and Cameroon 2014 ............................................................. 25.68 Art 58.1 ............................................................. 25.68 Art 58.3 ............................................................. 25.68 Interim EPA between the EU and Côte d’ Ivoire 2016 ............................................................. 25.69 Art 44 ................................................................ 25.69 Interim EPA between the EU and Ghana 2016 . 25.69 Art 44 ................................................................ 25.69 Lugano Convention on jurisdiction and the enforcement of judgments in civil and commercial matters [1988] OJ L319/9 ....... 21.62 Art 6(1) ............................................................. 24.08 Marrakesh Treaty (MT) to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired or Otherwise Print Disabled, 2013 ..... 4.20, 16.01–16.166, 23.20, 26.03, 30.02 Preamble ........................................................... 16.80 Art 2 ...................................................... 16.63, 26.36 Art 2(a) .................................................. 16.46, 16.50 Art 2(b) .................................................. 16.55, 16.73 Art 2(c) .......................... 16.55, 16.59, 16.60, 16.108 Art 2(c)(iii) ...................................................... 16.113 Art 3 ................................................................. 16.53 Arts 4–6 ............................................................ 16.12 Art 4 ................................................................. 16.63 Art 4.1(b) .......................................................... 16.65 Art 4.2(b) .......................................................... 16.72 Art 4.3 ............................................................... 16.67 Art 4.4 ...................................... 16.80, 16.82, 16.156 Art 5 ..................................... 16.101, 16.102, 16.163 Art 5.1 ............................................................. 16.101 Art 5(2) ................................. 16.107, 16.108, 16.116 Art 5.4 ............................................................. 16.163 Art 5.4(a) ........................................... 16.163, 16.164 Art 5.4(b) ........................................................ 16.163 Art 5.5 ............................................................. 16.161 Art 6 ..................................... 16.104, 16.153, 16.160 Art 7 ......... 16.63, 16.84, 16.85, 16.93, 16.95, 16.96, 16.97 Art 9 .................................................. 16.108, 16.116 Art 10(2) ........................................................... 16.44 Art 11 ................................................................ 16.74 Mercosur Trade Agreement Art 11 ................................................................. 9.72 Naples II Convention on the facilitation of the operational aspects of investigations ......... 21.130 Paris Convention 1883 (Convention for the Protection of Industrial Property) .......... 2.14, 12.02, 21.265 Art 1(1) ............................................................. 24.79 Phonograms Convention 1971 (Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication of their Phonograms, Geneva, 1971) ............................................. 26.59 Principles for Conflict of Laws in Intellectual Property (CLIP), European Max Planck Group on Conflict of Laws in Intellectual Property ... 30.07 Art 2:203 ........................................................... 24.06 Art 2:604 ............................................... 28.11, 28.15

Art 5(1) ............................................................. 11.77 Art 5(4) ............................................................. 11.77 European Patent Convention Art 2(2) ............................................................. 24.09 Art 64(1) ........................................................... 24.09 Art 64(3) ........................................................... 24.09 Europol Convention on the establishment of a European Police Office [1995] OJ C316/1 ....................................................... 21.121 Free Trade Agreement between EU, Colombia and Peru Art 234 ............................................................ 21.201 Free Trade Agreement between the European Union and its Member States, and the Republic of Korea, OJ 127/14.05.2011 ............. 21.255, 25.28 Art 10.1 ............................................................. 25.34 Art 10.3 ............................................................. 25.35 Art 10.5 ............................................................. 25.36 Art 10.5 ............................................................. 25.28 Art 10(5)(c) ..................................................... 21.255 Art 10(5)(d) .................................................... 21.255 Art 10.6 ............................................................. 25.55 Art 10.7 ............................................................. 25.59 Art 10.8 ............................................................. 25.53 Art 10.9.2 .......................................................... 25.40 Arts 10.12–10.13 .............................................. 25.50 Art 10.12.1 ........................................................ 25.51 Art 10.12.2 ........................................................ 25.51 Art 10.12.3 ........................................................ 25.51 Art 10.12.4 ........................................................ 25.51 Art 10.13.1 ........................................................ 25.52 Art 10.13.2 ........................................................ 25.52 Art 10.41 ........................................................... 25.62 Art 10.42 ........................................................... 25.62 Art 10.43 ........................................................... 25.62 Art 10.44 ........................................................... 25.63 Art 10.45 ........................................................... 25.63 Arts 10.46–10.47 .............................................. 25.63 Arts 10.48–10.49 .............................................. 25.63 Art 10.50 ........................................................... 25.63 Arts 10.54–10.60 to 10.66 ................................ 25.63 Arts 10.62–10.66 .............................................. 25.64 Art 10.69 ........................................................... 25.35 GATS Economic Integration (Art V) ........................... 2.05 General Exceptions (Art XIV) ........................... 2.05 GATT: General Agreement on Tariffs and Trade 1947, 55 UNTS 194 ................................... 25.01 Art III ................................................................. 2.16 Geneva Phonogram Convention (for the Protection of Producers and Phonograms against Unauthorized Duplication of their Phonograms) ....... 2.05, 8.84 Art 1(a) ............................................................... 8.46 Art 1(c) ............................................................. 6.102 Art 2 ................................................................. 6.102 Art 4 ................................................................... 8.36 Hague Convention on Choice of Court Agreements Art 10 ................................................................ 24.32 Interim EPA between the EU and Eastern and Southern African States (ESA) ................... 25.67

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TABLE OF LEGAL INSTRUMENTS Art 3:601 ........................................................... 28.10 Art 3:602 ........................................................... 24.98 Art 3:603 ............................................. 17.272, 28.12 Art 3:606 ........................................................... 24.91 Rome Convention: International Convention for the Protection of Performers, Producers of Phonograms Broadcasting Organizations, 1961 ....... 2.05, 2.13, 2.15, 2.16, 2.17, 2.30, 7.66, 12.20, 21.265, 25.13, 25.18, 25.20, 25.24, 25.25, 25.27, 25.39, 25.77, 26.02, 26.06, 26.21, 26.32, 26.38, 26.46 Art 1 .................................................... 6.106, 11.203 Art 1(1) ............................................................... 7.51 Art 2(1)(a) ........................................................... 2.15 Art 3 ................................................................... 6.38 Art 3(b) ............................................................... 8.46 Art 5 ............................................. 2.15, 24.56–24.57 Art 6 ................................................................... 2.15 Art 7 ................................................................. 25.40 Art 11 ................................................................ 12.53 Art 12 ...................................... 2.17, 6.83, 6.87, 6.91 Art 13 .................................................... 25.42, 26.20 Art 13(d) ............................................................. 2.17 Art 14 ............................................. 8.05, 8.42, 26.20 Art 15 .................................................... 16.04, 26.20 Art 15(2) ............................................................. 7.47 Art 16(1)(a)(iii) ................................................... 2.17 Art 16(1)(a)(iv) ................................................... 2.17 Art 16(1)(b) ........................................................ 2.17 Art 19 ................................................................ 26.15 Rome Convention 1980 (EEC Convention on the Law Applicable to Contractual Obligations) [1980] OJ L 266/1. .... 24.36, 24.39, 24.48, 24.49, 25.18 Art 3(3) ....................................... 24.51, 24.52–24.55 Art 4 ................................................................. 24.41 Art 4(5) ....................................... 24.41, 24.44–24.46 Art 5 ................................................................. 24.62 Art 6 ................................................................. 24.62 Art 7 ................................ 24.51, 24.58, 24.60, 24.63 Art 7(1) .................................................. 24.64, 24.65 Art 7(2) .................................................. 24.60, 24.62 Art 16 ................................................................ 24.67 Satellites Convention 1974 ................................... 26.20 Preamble ........................................................... 26.20 Singapore Trade and Investment Agreements ....... 9.72 Stabilisation and Association Agreement between the European Communities and their Member States, and the former Yugoslav Republic of Macedonia, Final Act, OJ L 84, 20.3.2004, p. 13–197 ..................................................... 25.15 Art 71 .............................................................. 25.18 Art 94 ................................................................ 25.20 Annex VII ......................................................... 25.18 Stabilisation and Association Agreement between the European Communities and their Member States and the Republic of Albania, OJ L 107/166, 28.4.2009 ..................................................... 25.15 Joint Declaration to art 73 ............................... 25.17 Art 73 .............................................................. 25.18 Art 102 .............................................................. 25.20

Annex V ............................................................ 25.18 Stabilisation and Association Agreement between the European Communities and their Member States, and the Republic of Montenegro, OJ L 108, 29.4.2010, p. 1–354 ............................. 25.15 Joint Declaration to art 75 ............................... 25.17 Art 75 .............................................................. 25.18 Art 75.2 ............................................................. 25.19 Annex VII ......................................................... 25.18 Stabilisation and Association Agreement between the European Communities and their Member States and the Republic of Serbia, OJ L 278, 18.10.2013, p. 14–471 ................................. 25.15 Joint Declaration to art 75 ............................... 25.17 Art 75 ................................................................ 25.18 Art 75.2 ............................................................. 25.19 Art 104 .............................................................. 25.20 Annex VII ......................................................... 25.18 Stabilisation and Association Agreement between the European Communities and their Member States, and Bosnia and Herzegovina, OJ L 164, 30.6.2015, p. 2–547 ..................................... 25.15 Joint Declaration to art 73 ............................... 25.17 Art 73 ................................................................ 25.18 Art 73.2 ............................................................. 25.19 Art 102 .............................................................. 25.20 Annex VII ......................................................... 25.18 Stabilisation and Association Agreement between the European Union and the European Atomic Energy Community, and Kosovo, OJ L 71, 16.3.2016, p. 3–321 ..................................... 25.15 Joint Declaration to art 77 ............................... 25.17 Arts 77–78 ....................................................... 25.18 Art 78.1 ............................................................. 25.19 Art 109 .............................................................. 25.20 Annex VII ......................................................... 25.18 Stockholm Convention establishing the European Free Trade Association (superseded in 2001 by the Vaduz Convention) ................................... 21.207 Art 2(g) ........................................................... 21.207 Art 19 .............................................................. 21.207 Art 19(1) ......................................................... 21.207 Art 19(4) ......................................................... 21.207 Annex J ........................................................... 21.207 Trade Agreement between the European Union and its Member States, and Colombia and Peru, OJ L354/21.12.2012 ......................................... 25.29 Art 195 .............................................................. 25.34 Art 215 .............................................................. 25.36 Art 216 .............................................................. 25.38 Art 216.1–216.2 ................................................ 25.38 Art 216.5 ........................................................... 25.38 Art 217 .............................................................. 25.53 Art 218.1 ........................................................... 25.55 Art 218.2 ........................................................... 25.56 Art 219 .............................................................. 25.61 Art 219.2 ........................................................... 25.60 Art 219.3 ........................................................... 25.59 Art 220.2 ........................................................... 25.40 Art 220.3 ........................................................... 25.43

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TABLE OF LEGAL INSTRUMENTS Art 220.4 ........................................................... 25.40 Art 220.5 ........................................................... 25.43 Art 220.6 ........................................................... 25.43 Art 220.8 ........................................................... 25.42 Arts 221–222 .................................................... 25.50 Art 223.1 ........................................................... 25.47 Art 223.2 ............................................... 25.46, 25.47 Art 234 .............................................................. 25.62 Art 236 .............................................................. 25,62 Art 237 .............................................................. 25.63 Art 238 .............................................................. 25.63 Arts 240–241 .................................................... 25.63 Arts 242–243 .................................................... 25,63 Art 244 .............................................................. 25.63 Art 250–254 ...................................................... 25.64 Arts 255–256 .................................................... 25.35 TRIPS Agreement: Agreement on Trade Related Aspects of Intellectual Property Rights, 1994 ....... 2.01, 2.05, 2.08, 2.13, 2.16, 2.20, 2.29, 2.30, 4.70–4.75, 5.37, 5.135, 8.41, 9.01, 11.79, 12.02, 12.03, 12.20, 12.23, 12.105, 12.147, 12.151, 12.221, 18.15, 18.20, 21.42, 21.43, 21.90, 21.202, 21.205, 21.210, 21.214, 21.222, 21.229, 21.230, 21.241, 21.251, 21.253, 21.254, 21.255, 21.256, 21.258, 21.264, 21.289, 21.293, 24.94, 24.95, 25.01, 25.03, 25.13, 25.18, 25.23, 25.25, 25.27, 25.63, 25.71, 25.77, 26.02, 26.20, 26.46, 28.14, 30.02 Pt III ......................................... 21.269, 25.62, 25.72 Art 1 ................................................................ 21.256 Art 1(1) .................................................. 3.17, 21.229 Art 2(2) ............................................................. 11.79 Art 3 ................................................................... 2.16 Art 3.1 .............................................. 2.02, 2.16, 2.26 Art 4 ........................................ 2.16, 2.18, 2.23, 2.26 Art 4(d) ............................................................... 2.18 Art 6 ................................................................... 3.17 Arts 7–8 ............................................................ 11.79 Art 7 ................................................................ 21.238 Art 8 ................................................................ 21.238 Art 8(2) ...................................................... 4.71, 4.72 Art 9(1) .................................................... 2.17, 13.46 Art 9(2) ............................................................... 5.14 Art 10 .................................................... 13.15, 25.44 Art 10(1) .................................................... 5.08, 5.19 Art 11 ...................................................... 5.69, 13.17 Art 12 ........................................................ 8.13, 8.22 Art 13 ....................... 4.74, 4.75, 5.131, 11.78, 11.79 Art 14 ................................................................ 26.20 Art 14(5) .................................................... 8.36, 8.42 Art 31(k) .................................................... 4.73, 4.74 Art 40 ........................................................ 4.70, 4.71 Art 40(1) ............................................................. 4.71 Art 40(2) ............................................................. 4.74 Arts 41–61 ......................................... 11.167, 21.207 Art 41 .................................................. 12.127, 25.62 Art 41(1) ........................................................... 12.28 Art 41(2) ........................................................... 12.24 Art 42 .................................................. 12.31, 12.127 Art 43 ................................................................ 12.54

Art 43(1) ........................................................... 12.64 Art 43(2) ........................................................... 12.65 Art 44 ................................................................ 24.94 Art 44(1) ......................................................... 12.169 Art 44(2) ......................................................... 12.184 Art 45 .............................................................. 12.192 Art 46 .............................................................. 12.160 Art 47 ............. 12.106, 12.107, 12.127, 21.48, 25.63 Art 50 .................................................. 12.87, 12.129 Art 50(5) ........................................................... 12.87 Art 50(6) ......................................................... 12.101 Art 51 .................................................. 21.02, 21.237 Art 61 ..................................... 12.226, 21.240, 25.63 Art 67 .............................................................. 21.262 Art 69 ................................................................ 21.79 Annex IC .......................................................... 25.66 United Nations Convention on the Rights of Persons with Disabilities (the UNCRPD) 2006 ...... 16.32 Art 24 ................................................................ 16.34 Art 30 ................................................................ 16.34 Art 30.3 ............................................................. 16.34 Universal Copyright Convention ............................ 2.13 Universal Declaration of Human Rights (UDHR) ........................................................ 2.03 Art 27.2 ............................................................... 2.04 Vienna Convention of the Law of Treaties 1969 Art 31(1) .............................................. 11.78, 21.238 Art 31(2) ......................................................... 21.238 Art 31(2)(a) ....................................................... 11.78 Washington Declaration on Intellectual Property and the Public Interest ....................................... 11.69 WIPO Copyright Treaty (WCT) 1996 ....... 1.09, 2.05, 2.13, 5.37, 8.41, 9.01, 9.29, 11.01, 11.25, 11.41, 11.79, 16.65, 20.01, 21.200, 21.205, 21.257, 21.265, 25.13, 25.18, 25.25, 25.27, 25.49, 25.51, 25.74, 25.77, 26.02, 26.03, 26.04, 26.22, 26.32, 26.38, 26.46, 30.02, 30.07 Arts 1–14 ........................................................ 21.255 Art 2 ........................................................ 5.14, 26.36 Art 3 .......................................................... 2.13, 2.16 Art 4 ............................................... 5.08, 5.17, 25.44 Art 6 ...................................................... 11.42, 11.47 Art 6(1) ............................................................. 11.48 Art 7 ...................................................... 11.47, 13.17 Art 7(2)(i) ........................................................... 5.69 Art 8 ........................................... 11.14, 11.21, 22.69 Art 9 ................................................................... 8.56 Art 10 .................................................... 11.78, 16.04 Art 10(2) ........................................................... 11.78 Art 11 .......................... 11.109, 11.126, 21.37, 25.50 Art 12 ....................................... 11.151, 21.37, 25.50 Art 14(2) ......................................................... 11.167 WIPO Performance and Phonograms Treaty (WPPT) 1996 ..... 1.09, 2.05, 2.13, 2.30, 7.46, 8.41, 11.01, 11.25, 11.41, 11.79, 20.01, 21.200, 21.205, 21.257, 21.265, 25.13, 25.18, 25.25, 25.27, 25.49, 25.51, 25.74, 25.77, 26.02, 26.03, 26.04, 26.06–26.08, 26.09, 26.10, 26.11, 26.22, 26.32, 26.38, 26.46, 30.02 Arts 1–23 ........................................................ 21.255

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TABLE OF LEGAL INSTRUMENTS Loi du 4 décembre 2006 transposant en droit belge la Directive 2001/84/CE ................................. 10.20

Art 1(2) .................................................. 7.51, 11.203 Art 2(a) ............................................................. 26.50 Art 2(b) ............................................................... 8.46 Art 2(f) .............................................................. 25.39 Art 2(g) ............................................................. 25.39 Art 3(2) ............................................................... 2.13 Art 4 .......................................................... 2.13, 2.16 Art 5 ................................................................. 25.38 Art 6 ................................................................. 25.40 Art 7 ................................................................. 25.40 Art 8 ................................................................. 25.40 Art 10 .................................................... 11.14, 25.40 Art 11 ................................................................ 25.41 Art 12 .................................................... 25.41, 26.17 Art 13 ................................................................ 25.41 Art 14 .................................................... 11.14, 25.41 Art 15 ...................................................... 2.13, 25.43 Art 15(3) ............................................................. 2.13 Art 16 ................................................................ 16.04 Art 17(2) ......................................................... 11.200 Art 18 ................. 8.37, 11.109, 11.126, 21.37, 25.50 Art 19 ....................................... 11.151, 21.37, 25.50 Art 23(2) ......................................................... 11.167 WTO Dispute Settlement Procedure ........ 2.16, 21.264

Czechoslovakia Resale Right, 24 November 1926 ......................... 10.04

Denmark Act No 1402, 21 December 2005, Lovtidende A .................................................................. 10.20 Consolidated Act No 202, 27 February 2010, Copyright Art 23 ................................................................ 17.90

France Code of Intellectual Property (Code de la propriété intellectuelle) Art L 111-4 ........................................................ 2.27 Art L 112-2 ...................................................... 18.17 Art L 112-3 ........................................................ 8.67 Art L 113-2 ........................................................ 8.21 Art L 113-5 ........................................................ 8.21 Art L 122–1 ........................................................ 6.16 Art L 122-5 2° ................................................ 11.121 Art L 122-5, 3 e ............................................... 17.90 Art L 122–6 3° .................................................... 6.15 Art L 122-8 ...................................................... 10.20 Art L 123-3 ........................................................ 8.21 Art L 123-7 ...................................................... 10.48 Art L 133–1 3° .................................................... 6.15 Art L 133-3 ........................................................ 6.72 Art L 133-4 ........................................................ 6.69 Art L 133–4 2° .................................................... 6.47 Art L 134-1 -134-9 ........................................ 17.170 Art L 212–2 ........................................................ 6.79 Art L 212–3 ........................................................ 6.79 Art L 213–1 ........................................................ 6.15 Art L 215–1 ........................................................ 6.15 Art L 216–1 3° .................................................... 6.15 Art L 335-2 ...................................................... 21.02 Art L 335-3 ...................................................... 21.02 Art L 342–3 ........................................................ 9.58 Decree No 2013-182 of 27 Feb. 2013, implementing Arts L134-1 to L134-9 of the French Intellectual Property Code, as amended by Law 2012-287 of 1 March 2012, on the Digital Exploitation of Out-of-Commerce Books of the 20th Century) .............................................. 13.24 Loi n° 2003–517 of 18 June 2003 ................. 6.15, 6.17 Loi d’accès aux documents administratifs 78-753 of 17 July 1978 ...................................................... 18.05 Loi n° 85–660 du 3 juillet 1985 Arts 17–18 .......................................................... 6.79 Loi n° 2006–961 du 1er août 2006 relative au droit d’auteur et aux droits voisins dans la société de l’information ................................................ 10.20

NATIONAL LEGISLATION Albania Copyright Act, Law 35/2016 of 31 March 2016 Art 119–126 ........................................................ 9.72

Australia Resale Royalty Right for Visual Artists Act 2009 .................................................. 10.63–10.67

Austria Copyright Act s 82(5) ............................................................. 12.167 Copyright Amendment Act .................................. 10.20 Private International Law Act 1978 Art 34(1) ........................................................... 24.81 Urheberrechtsgesetz-Novelle 2009, BGBl. I , 13.1.2010 ..................................................... 10.80

Belgium Code of Economic Law Art XI.293 ....... 21.02Computer Programs Act 1994 Art 4 ................................................................... 5.56 Code of Private International Law Art 93(1) ........................................................... 24.81 Copyright Act ....................................................... 10.02 Copyright and Neighbouring Rights Act 1994 Art 22, §1, 4quater ........................................... 17.90

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TABLE OF LEGAL INSTRUMENTS Hadopi II (Loi n° 2009–1311/28.10.2009). ....... 11.178 Loi n° 2012-287 du 1er mars 2012 relative à l’exploitation numérique des livres indisponibles du XXe siècle ............................................. 17.170 LOI n° 2019-775 du 24 juillet 2019 tendant à créer un droit voisin au profit des agences de presse et des éditeurs de presse, JORF n°0172 du 26 juillet 2019 ............................................................. 7.228 Loi n° 2009-669 du 12 juin 2009(as amended by the ‘Hadopi2’ Law on 28 October 2009). It should be noted that, as a result of a Decree of 8 July 2013, which abolished Art. R.335-5 of the French Intellectual Property Code ............ 21.137 Livre of the Code des relations entre le public et l'administration Art L 311-5 1(f) III .......................................... 27.46 Copyright Act of 1957 .......................................... 10.02 Declarations of Human Rights and Civil Rights of 1789 and 1793 ............................................... 2.03

Germany Copyright Act (Urheberrechtsgesetz (UrhG)), as amended ........................................................ 2.26 Art 6 ................................................................ 11.114 Art 11 ................................................................. 8.67 Art 15 .............................................................. 11.114 Art 17(2) ............................................................. 9.40 Art 41 ................................................................. 8.49 Art 53 .............................................................. 11.119 Art 52a .............................................................. 17.90 Art 53 ................................................................ 17.90 Art 53a .............................................................. 17.90 Art 63(a) ......................................................... 11.114 Art 64 ................................................................. 8.67 Art 66 ................................................................ 13.30 Art 72 ......................................... 8.58, 17.218, 22.55 Arts 73–83 ......................................................... 6.79 Art 79(2) ............................................................. 8.49 Art 87a(1) ........................................................... 9.40 Art 87(1) ............................................................. 9.40 Art 87(2) ............................................................. 9.40 Art 98(3) ......................................................... 12.167 Art 100 ............................................................ 12.184 Copyright Administration Act, Urheberrechtswahrnehmungsgesetz, UrhWG §§ 11 and 12 ...................................................... 7.84 Fifth Act amending the Copyright Act of 10 November 2006, BGBl. I, 2587 ................. 10.20 Act of 1 Oct. 2013 ‘zur Nutzung verwaister und vergriffener Werke und einer weiteren Änderung des Urheberrechtsgesetzes’ (BGBl. I 2013, S. 3728 (Nr. 59)), amending das Urheberrechtswahrnehmungsgesetz vom 9. Sep. 1965 (GCAA) ........................................... 17.170

Greece Copyright Act 2121/1993 Art 29(2) ............................................................. 8.67 Art 55(2) ........................................................... 12.41 Resale Right Directive Implementation Act, No 3524/2007 (OJ 15/A’/26.1.2007) ..... 10.20, 10.84

Hungary Copyright, Act LXXVI, 22 June 1999 Art 34(2) ........................................................... 17.90 Notice and Take Down Act (Act 2001/108) ..... 11,178

Ireland Copyright and Related Rights Act (CRRA) ........ 17.15 Performers’ Protection Act s 2(1) ................................................................... 6.79 s 3(1) ................................................................... 6.79 s 5 ...................................................................... 6.79 European Communities (Artist’s Resale Right) Regulations 2006, S.I. 2006 No 312 .......... 10.81

Italy Copyright Act ......................................................... 2.26 Art 5 ................................................................. 18.17 Art 11 ................................................................ 18.21 Art 29 ................................................................ 18.21 Art 92 ................................................................. 8.58 Resale Right legislation 22 April 1941 ................. 10.04 Art 70 ................................................................ 17.90 Decreto Legislativo 13 febbraio 2006, n. 118 ‘Attuazione della direttiva 2001/84/CE ...... 10.20 Private International Law Act 1995 ..................... 24.81 L. n. 241/1990(‘Nuove norme in materia di procedimento amministrativo e di diritto di accesso ai documenti amministrativi’) Art 24 ................................................................ 27.46

Japan Copyright Act s 5, art 47-7 ...................................................... 17.18

Korea Copyright Act Art 35(3) ......................................................... 11.108

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TABLE OF LEGAL INSTRUMENTS

Copyright Act ....................................................... 10.83 Copyrights, Neighbouring Rights and Databases Law, 18 April 2001 Art 10 ................................................................ 17.90 Art 10, 2° .......................................................... 17.90 Resale Right implementing Regulation, 25 August 2005 ............................................................. 10.83

Ley 3/2008, de 23 de diciembre, relativa al derecho de participación en beneficio del autor de una obra de arte original, BOE n° 310, 25 December 2008, 51995 ................................................. 10.22 Real Decreto 1657/2012, de 7 de diciembre, por el que se regula el procedimiento de pago de la compensación equitativa por copia privada con cargo a los Presupuestos Generales del Estado ........................................................ 11.120

Netherlands

Sweden

Copyright Act s 38(2) ................................................................. 8.21 Private International Law Act on Torts ............... 24.81 Art 3(1) ................................................................. 24.81 Resale Rights (Besluit van 8 december 2009, houdende verlenging van de periode in artikel 43e, derde lid, Auteurswet) ........................................... 10.82

Act 2007:521 amending the Copyright Act ......... 10.20 Law (1.4.2009) .................................................... 11.178

Luxembourg

Switzerland Private International Law Act 1987 ..................... 24.81

Turkey

Poland Resale Right legislation 22 March 1935 .............. 10.04 Copyright and Related Rights Act of 4 February 1994 ............................................................. 10.20 Art 27 ................................................................ 17.90

Copyright Act of 1951 Art 8 ................................................................... 9.72 Law No 5651 s 8(1) ............................................................... 21.181

United Kingdom

Portugal Artist’s Resale Right, Lei n.° 24/2006 de 30 de Junho ........................................................... 10.20

Slovenia Law No 2121/1993 Article 65(2) .................................................... 12.202

Spain Constitution 1978 Art 20 ................................................................ 28.19 Copyright Act 1879 ................................................ 8.04 Copyright Act 1987 ................................................ 8.04 Art 15 ................................................................. 8.67 Art 128 ................................................................ 8.58 Copyright Act Art 31ter(2) ....................................................... 16.68 Intellectual Property Law, Real Decreto Legislativo 1/1996, de 12 de abril Art 8 ................................................................... 8.21 Art 28(2) ............................................................. 8.21 Art 32 .............................................................. 17.225 Law for Sustainable Economy (8.1.2010) (Ley Sinde, Sinde Law). .................................. 11.178, 21.137 Ley 22/1987, de 11 de noviembre, BOE n° 275, 17 November 1987, 34163 ............................... 10.22

Act on the right of authors themselves to control the printing of their works 1710 ......................... 8.01 Copyright, Designs and Patents Act 1988 .......... 11.83, 17.12, 17.218 s 3 ...................................................................... 13.14 s 9(3) ................................................................... 5.43 s 28B ............................................................... 11.120 s 45 ...................................................................... 9.66 s 79 ...................................................................... 5.56 s 81 ...................................................................... 5.56 s 86 ...................................................................... 8.67 s 178 .................................................................. 13.14 Sch 2(1B) ........................................................ 11.120 Digital Economy Act 2017 .................... 11.178, 21.159 Freedom of Information Act 2000 s 31(1)(c) ........................................................... 27.46 UK Withdrawal Agreement Art 127 .............................................................. 29.26 Artist’s Resale Rights Regulations 2006, SI 2006 No. 346 ............................................................... 10.79 Intellectual Property (Copyright and Related Rights) (Amendment) (EU Exit) Regulations 2019 Reg 11–12 ......................................................... 13.61 Reg 23 ............................................................... 13.61 Reg 31 ............................................................... 13.61 Copyright and Rights in Performances (Research, Education, Libraries and Archives) Regulations 2014 No. 1372 ............................................ 17.12

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TABLE OF LEGAL INSTRUMENTS Copyright and Rights in Performances (Extended Collective Licensing) Regulations 2014, SI 2588 ........................................................... 17.170

Uruguay Resale Right legislation 17 December 1937 ......... 10.04

United States Constitution .......................................................... 29.10 Copyright Act 1976 ............................................. 19.34 § 107 ................................................................. 17.22 § 110(5) .......................................................... 21.200 § 302 ................................................................... 8.03 § 302(c) ............................................................... 8.20 Copyright Extension Act of 1998 .......................... 8.14 Digital Millennium Copyright Act (DMCA) 1998 ........................ 19.07, 19.14, 21.137, 21.152 Online Copyright Infringement Liability Limitation Act (OCILLA) ......... 19.03, 19.05, 19.06, 19.07, 19.09, 21.137 Patent Act § 271 (f) ............................................................ 24.83 PROTECT IP Act (PIPA) ................................ 21.137

17 USC s 512 ......... 19.05, 19.15, 19.16, 19.19, 19.31, 19.32, 19.34 s 512(c) ................. 19.01, 19.02, 19.04–19.18, 19.25 s 512(c)(l)(A) .................................................... 19.04 s 512(c)(1)(A)(i)(ii) ........................................... 19.10 s 512(c)(l) (B) ................................................... 19.04 s 512(c)(l)(A)(iii) ............................................... 19.04 s 512(c)(2) ......................................................... 19.04 s 512(d) ............................................................. 19.25 s 512(f) ................. 19.05, 19.17, 19.18, 19.32, 19.34 s 512(g) .................................................. 19.32, 19.34 s 512(g)(1) ......................................................... 19.05 s 512(g)(3) ......................................................... 19.05 s 512(i)(1)(A) .................................................... 19.04 s 512(j) .............................................................. 19.04 s 512(m) ................................................. 19.11, 19.12 s 512(m)(1) ............................................ 19.02, 19.11 s 512(m)(1) ....................................................... 19.04 California Resale Royalty Act (CRRA) 1976 .................................................. 10.68–10.70 California Civil Code, s 986 ................................. 10.68 American Law Institute Principles of Intellectual Property § 301 ................................................................. 24.77

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INTRODUCTION Irini Stamatoudi and Paul Torremans Intellectual property rights play a pivotal role in the advance of technology, the sustainability of 0.01 creativity and the flourishing of the economy in the European Union (EU). Copyright forms an important part of intellectual property (IP), especially if one considers that it is closely linked to culture, knowledge, digitisation projects, online markets and new technologies, such as Artificial Intelligence (AI). Copyright has to face a dual challenge. On the one hand, it needs to provide sufficient protection to authors and right holders and on the other hand, it needs to accommodate the needs of the information society, technological evolution and the public, which are mostly concerned with access to content. In its published Policy Statement, the EU Commission states that ‘[d]igital technologies have 0.02 radically changed the way creative content is produced, distributed and accessed. We are adapting the EU copyright rules to new consumer behaviours in a Europe which values its cultural diversity’.1 That necessarily leads to modernisation of the copyright rules, which cuts across three main areas: a) better choice and access to content online and across borders; b) improved copyright rules on research, education and cultural heritage; and c) achieving a well-functioning marketplace for copyright.2 But let’s take things from the start. Copyright has changed shape through the years depending on 0.03 copyright’s weight in the EU and the Single Market. When the Treaty of Rome was drafted (1957) copyright was not an issue. The reason for that was that the aims and targets of a European Economic Community seemed to be unrelated to IP and even more to copyright. In the whole of the Treaty of Rome one could find just one reference to IP and this was only to ‘industrial and commercial property’. This reference was inserted as an exception to the general rule for the free movement of goods (Art. 36 EC Treaty). At a later stage the Court of Justice of the European Union (CJEU) applied this exception by analogy to copyright. The case law developed on the basis of this provision was considerable and touched upon aspects that one could not even conceive in the early stages. The importance of copyright (as well as IP rights) was only realised when this right (because of its absolute and exclusive character as well as because of its territorial constraints) was used by entrepreneurs as a tool to sidestep provisions on the free movement of goods and to try to charge different prices for the same product in different EU Member States through the prevention of parallel imports. The CJEU’s case law restored the balance and set the principles. Nowadays, the creative industries are considered to be a backbone of the EU’s economy. According 0.04 to a 2016 Report by the European Parliament:3 all around the world, the cultural and creative sector (hereafter referred to as CCIs) is considered a major and growing part of the global economy. Its importance as a generator of jobs and wealth is increasingly recognised, particularly so in the EU: following a recent study commissioned by the European Commission, CCIs (excluding high-end industries) constitute 11.2 % of all private enterprises and 7.5 % of all persons employed in the total economy. Overall, more than three million enterprises, employing over 12 million persons, can be comprised within CCIs (excluding high-end industries). In terms of value added, CCIs

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https://ec.europa.eu/digital-single-market/en/policies/copyright. Ibid. Report on a coherent EU policy for cultural and creative industries (2016/2072(INI)), 30.11.2016 .

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INTRODUCTION (excluding high-end industries) generate 5.3 % of the total European GVA.4 High-end industries, on the other hand, employ approx. 1.7 million persons. Their value in terms of sales of goods and services amounts to € 547 billion, or approximately 4 % of nominal EU GDP. On its site the European Commission states that ‘33 sectors of the EU economy are considered copyright-intensive, accounting directly for over 7 million jobs, or 3% of employment in the EU’.5

0.05 It is on this basis – as it has been developed through the years – that the EU decided to become more energetic concerning copyright issues and their adaptation to the new environment. 0.06 On 19 May 2010 the EU introduced the Europe 2020 Strategy, which was its plan for the advancement of the economy. This strategy set out five key targets6 to be achieved by the end of 2020 through seven ‘flagship initiatives’, which among others included innovation and the digital economy. 0.07 The Digital Agenda presented by the European Commission formed one of the seven ‘flagship initiatives’.7 It aimed to better exploit the potential of Information and Communication Technologies (ICTs) in order to foster innovation, economic growth and progress. Actions relating to IP rights were scheduled to be concluded by 2014 and aimed to adjust existing IP rights to the digital world. The Europe 2020 Strategy was published in the form of a Communication.8 0.08 In April 2011 the Commission published another Communication known as ‘The Single Market Act’ (Single Market Act I).9 This Act aimed at delivering 12 projects on the basis of which the Single Market would be reinforced for 2012. Amongst these projects two were dedicated to Intellectual Property Rights and the Digital Single Market. In October 201210 the Commission proposed a second set of actions (12 priority actions) (Single Market Act II) to further develop the Single Market and ‘exploit its untapped potential as an engine for growth’. These actions included the Digital Economy. 0.09 On 24 May 2011 the EU introduced the Intellectual Property Strategy, which was complementary to and an essential element of the Europe 2020 Strategy, the Single Market Act and the Digital Agenda for Europe.11 This strategy contained a map of initiatives in the area of copyright. 0.10 According to Internal Market Commissioner Michel Barnier the aim: is to get the balance between these two objectives right for IPR across the board. To make Europe’s framework for intellectual property an enabler for companies and citizens and fit for the online world and the global competition for ideas.

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European Commission, Boosting the competitiveness of cultural and creative industries for growth and jobs, 22.07.2016 . . These targets cover employment; education; research and innovation; social inclusion and poverty reduction; and climate/energy. Digital Agenda for Europe (COM (2010) 245). Communication from the Commission Brussels, 3.3.2010, COM (2010) 2020 final. Communication from the Commission to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions Single Market Act twelve levers to boost growth and strengthen confidence; working together to create new growth; COM/2011/0206 final (Single Market Act I). Communication from the Commission to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions. Towards a Single Market Act. For a highly competitive social market economy 50 proposals for improving our work, business and exchanges with one another. Brussels, 11.11.2010. COM (2010) 608 final/2. See also the Annual Growth Survey 2011 (COM (2011) 11) and the Innovation Union (COM (2010) 546).

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These initiatives (mainly legislative in nature) would considerably facilitate the protection, licensing 0.11 and offering of works. Yet, they would remain only part of the bigger puzzle: they would only constitute bits and pieces of a larger action required for copyright. Some (or even many) think that copyright urgently needs a holistic ‘retouch’ or else a full harmonisation as it touches on too many products (aiming at) circulating freely within the Single Market and therefore it brings up far too many financial aspects, which no longer allow EU Member States to abide by their original traditions in the field. On 5 December 2013 the European Commission launched a Public Consultation on the review of 0.12 the EU copyright rules. The deadline (after being extended) was 5 March 2014. The Hellenic Presidency of the Council (January to June 2014)12 initiated a discussion on issues contained in the Public Consultation. On 9 December 2015 the European Commission issued a Communication on a modern and more 0.13 European copyright framework, which set out the main political objectives and areas of action, as well as the time frame, and which tried to integrate existing initiatives with pending and new ones.13 On 14 June 2017, the Regulation on cross-border portability of online content services was 0.14 published, which allows consumers who buy or subscribe to films, sport broadcasts, music, e-books and games to access them when they travel in other EU countries. On 13 September 2017 a Directive and a Regulation implementing the Marrakesh Treaty in the 0.15 EU were adopted. These two legal instruments partly modify the exceptions and limitations found in the Information Society Directive and adjust them to the provisions of the Marrakesh Treaty. People who are blind, visually impaired, or otherwise print disabled within the EU, as well as those from other countries, will be able to access more books and other print material in accessible formats, including adapted audio books and e-books, from across the EU and the rest of the world. On 17 May 2019 two Directives were published: The new Directive on copyright in the digital 0.16 single market and the Directive on television and radio programmes, laying down rules to facilitate access to online TV and radio content across borders. The avenue to copyright’s modernisation has not been without obstacles. The main conflict focused 0.17 on where to draw the line. EU institutions (amongst themselves) as well as national governments (amongst themselves and in their relationship with the EU institutions) did not always share the same views. The adoption of the Digital Single Market (DSM) Directive and its two controversial Articles (i.e., Arts 15 and 17) form one example only in this context. Yet, consensus prevailed. One could, of course, argue that not much is left from the menu that was originally envisaged by the EU policy leaders. 0.18

Up to now the acquis communautaire consists of 11 Directives and 2 Regulations.

The CJEU has also been pro-active, aiming perhaps to attain what would be slow and cumbersome 0.19 (though more democratic) for politics and policies. Prime examples in this respect are the notion of ‘new public’, the harmonisation of the originality criterion in the EU and the role of fundamental rights with regard to exceptions and limitations to copyright. 12 13

During the Hellenic Presidency of the Council of the EU Irini Stamatoudi has acted as a President. European Commission, Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions towards a modern, more European copyright framework, Brussels, 9.12.2015, COM(2015) 626 final.

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0.20 This book aims to cover all matters pertaining directly to ‘EU copyright law’ and at the same time offer a commentary on the relevant legislative instruments. 0.21 It also aims to approach ‘EU copyright law’ from the perspective of the international developments that currently take place in WIPO and look into trends and needs for the future. 0.22 The book is divided into four main parts. The first part deals with the general principles of copyright law in the EU. It offers a general view on the acquis communautaire, on the notion of ‘EU copyright law’ and presents the principles of non-discrimination, free movement of goods and the ‘essential facilities’ doctrine. The second part constitutes the main corpus of the book and it is a commentary on all EU Copyright Directives and Regulations. Once the hard law picture is set, the book moves on to Part III to discuss general EU policies and actions in key areas such as copyright enforcement and potential clashes with privacy, digitisation projects, such as Europeana, and present some thoughts on a decade of EU copyright policy in the shadow of crises. Part III also deals with private international law issues, especially with regard to the internet’s multi-territorial nature. The fourth part of the book discusses issues relating to the present and future of copyright. This is done from the perspective of the developments in the World Intellectual Property Organization (WIPO), from the perspective of the role of the CJEU as well as from the point of view of those advocating the need for a total (or more substantial) harmonisation. 0.23 Although the book aims at being comprehensive, it is not exhaustive, since there are many more legislative instruments, initiatives or aspects which, although they do not relate directly to copyright, are still relevant to it. Being exhaustive would be an almost unattainable task, which would require a lot more effort, time and work and would perhaps make this book an unworkable tool for those aiming to use it in practice. We nevertheless hope that the book provides a comprehensive and elucidating coverage of those instruments and policies that have copyright as (one of) their core element(s).

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Part I GENERAL PRINCIPLES OF EUROPEAN COPYRIGHT

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1 IS THERE A CONCEPT OF EUROPEAN COPYRIGHT LAW? HISTORY, EVOLUTION, POLICIES AND POLITICS AND THE ACQUIS COMMUNAUTAIRE Agnès Lucas-Schloetter I.

1. The assessment of the acquis communautaire 2. From European common copyright principles to a genuine European copyright law

THE EVOLUTION OF COPYRIGHT LAW WITHIN THE EUROPEAN UNION 1.02 1. The relationship between Copyright and Primary EC Law (1957–1987) 1.03 2. The harmonisation of copyright law within the European Community (1987–2007) 1.07 3. The increasing role of the ECJ since 2007 1.11

II. THE ACHIEVEMENT OF A EUROPEAN COPYRIGHT LAW?

1.14

1.19

III. CONCLUSION

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1.14

1.01 Copyright law has undergone profound changes over the last decades. Assessing whether something such as a real European Copyright Law has now been achieved is quite a challenging task. This chapter aims at retracing first, the evolution of copyright law within the European Union (I). This evolution was dependent both on political and technological changes that have taken place since the creation of the European Economic Community established by the Treaty of Rome 1957. After reviewing that evolution, we will try to answer the question asked in the title of this chapter and, second, to assess whether there is today such a concept of European Copyright Law (II).

I. THE EVOLUTION OF COPYRIGHT LAW WITHIN THE EUROPEAN UNION 1.02 Although approximate, it seems possible to distinguish three successive phases in this evolution: the focus on the relationship between copyright and primary European Community (EC) law in the first 30 years (1957–87), the process of harmonisation during the next 20 years (1987–2007) and the new subsequent era, where the European Court of Justice (ECJ) is playing the major role.

1. The relationship between Copyright and Primary EC Law (1957–1987) 1.03 It has been argued that at the time the Treaty of Rome was adopted, copyright law was not affected by its provisions. Copyright law and EC primary law were seen as two independent pieces of legislation, which could and should ignore each other: while the EC was then only an economic one, whose primary goal was to create a common market, copyright did not have at that time a strong economic dimension, but was mainly cultural. It protected primarily aesthetic or at least artistic creations, but not, or to a rather limited extent, factual and functional works. In most of the Member States, related rights protecting investment had not yet been recognised and copyright was seen as being clearly distinct from ‘industrial and commercial property’, which Article 36 EC Treaty referred to.

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Thus, there appeared to be no need to harmonise copyright law of the Member States, since 1.04 differences in legislation did not have any negative impact on trade within the Community. The problematic issues that may arise from the differences between national legislations in case of transnational exploitation of copyright protected works had in any event already been addressed at international level by the Berne Convention.1 It was also argued in this context that Article 7 EC Treaty prohibiting any discrimination on grounds of nationality did not pose any problem, since the Berne Convention, which all then Member States were members of, already provided for the principle of national treatment of foreigners. However, from the very beginning, copyright shared with other intellectual property rights two 1.05 features, which were likely to clash with some rules of the EC Treaty: its territoriality potentially conflicts with the free movement of goods and services,2 and its exclusivity possibly impairs the rules safeguarding the freedom of competition.3 Both issues have been addressed in the 1970–80s by the case law of the ECJ, which has used quite the same reasoning for copyright as for patent or trademark law.4 It first decided that copyright, notwithstanding its cultural aspect, falls within the scope of ‘industrial and commercial property’, whose protection may justify an exception to the free flow of goods and services (Art. 36 EC Treaty).5 But, as for the other IP rights, the Court distinguished between the existence of copyright that is not affected by EC law and is a matter for national law, and its exercise, which must comply with the provisions of the EC Treaty. With respect to the former, the Court applied to copyright the specific subject matter doctrine6 that was first established for patent and trademark law.7 Regarding the latter, the Court developed the Community-wide exhaustion rule,8 which, however, does not have exactly the same extent for copyright as for patent or trademark law. The ECJ’s early case law in the field of copyright dealt either with the import of sound recordings 1.06 from one Member State to another, or with broadcasting and cable transmission of motion pictures. In the first case,9 the Court admitted quite early that rights holders may not prevent or restrict the importation of sound recordings which have been lawfully marketed in another Member State with their consent, since their right to distribute copies of the protected work is exhausted. In case of broadcasting and cable transmission of motion pictures on the other hand,10 the Court held that the problems were not the same as those arising in connection with the marketing of works in material

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Berne Convention for the Protection of Literary and Artistic Works, last amended on 28 September 1979. See below Chapter 3 by B. Ubertazzi. See below Chapter 4 by A. Firth. Joined cases C-55/80 and 57/80 Musik-Vertrieb Membran v GEMA [1981] ECR 147, the Court recognised the functional differences between copyright and the other IP rights but refused to make a legal distinction between them because of the economic aspect of copyright. Case C-78/70 Deutsche Grammophon v Metro [1971] ECR 487, the Court only expressed the ‘assumption’ that related rights may fall under Art. 36. The solution was later clearly stated with respect to copyright in joined Cases C-55/80 and 57/80 Musik-Vertrieb Membran v GEMA. Case C-78/70 Deutsche Grammophon v Metro; C-62/79 Coditel v CinéVog Films [1980] ECR 881. However, in contrast to other IP rights, the Court did not give at that time a general definition of the specific subject matter of copyright. But see later C-158/86 Warner Brothers v Christiansen [1988] ECR 2605, according to which the specific subject matter of copyright encompasses (at least) both exclusive rights of reproduction and of performance and joined cases C-92/92 and 326/92 Phil Collins v Imtrat [1993] ECR 1–5145, according to which the subject matter of copyright and related rights ‘is to ensure the protection of the moral and economic rights of their holders’. The doctrine of exhaustion already existed in some Member States such as Germany, but was of course limited to the national territory and primarily seen as a compromise between the intellectual property right of the copyright owner and the common proprietary right of the owner of the tangible copy in which the work is embodied, the latter being free to resell or otherwise dispose of his property. Where the free movement of goods is at stake (Arts 30 and 34 EC Treaty). Which involves the free movement of services (Arts 59 and 60 EC Treaty).

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form like books or sound recordings11 and that exhaustion did neither apply to the right to rent12 nor to the right to perform a work in public.13

2. The harmonisation of copyright law within the European Community (1987–2007) 1.07 The Single European Act, which entered into force on 1 July 1987 and whose objective was to complete the internal market, triggered a new era in the evolution of copyright law within the EC.14 Thirty years after the adoption of the Treaty of Rome, the political, legal and technological landscape had considerably changed. The development of traditional broadcasting and the invention of new technologies such as cable and satellite had led to increased cross-border exploitation of copyright protected works. The extended scope of copyright and the introduction of related rights protecting investment had also raised the economic significance of this IP right, which could no longer be considered as affecting only cultural matters and being in the sole competence of the Member States. In its Green Paper on Copyright and the Challenge of Technology, published in 1988,15 the Commission identified some issues, which required ‘immediate action’ by the EC legislature. The probably most important one was that of computer programs, which resulted in the adoption of the first Directive in the field of copyright a few years later.16 1.08 To protect computer programs as ‘literary works’ within the framework of copyright was a political decision in order to ensure the growth of a competitive and dynamic European software industry. Copyright as a whole lost thereby ‘something of its cultural specificity, but it gained considerably in political awareness’.17 It was the same objective of improving the competitiveness of the European economy that led in 1996 to the adoption of the Directive about databases.18 Other directives of the so-called ‘first generation’ aimed for their part at improving primarily the proper functioning of the internal market.19 Most of them were specific reactions to the ECJ’s case law having admitted restrictions on the freedom of movement of goods and services, which were justified by national copyright rules.20 1.09 Since legislative competence of the Community was (and still is) limited by the principles of subsidiarity and proportionality and the legal basis for the adoption of directives in the field of copyright was thus far only Article 114 TFEU (ex Art. 95 EC Treaty), the result of this harmonisation process has been a patchwork of provisions dealing with selective subject matters, without any overall consideration of copyright and related rights as a whole. The Information

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Case C-62/79 Coditel v CinéVog Films; C-262/81 Coditel v CinéVog Films II [1982] ECR 3381. Case C-158/86 Warner Brothers v Christiansen. Case C-62/79 Coditel v CinéVog Films. Setting in 1987 the beginning of this second stage in the history of European Copyright Law is of course quite arbitrary. See already the 1985 White Paper on the completion of the internal market (COM (85) 310 final). See also as soon as 1974 the resolution of the European Parliament of 13 May 1974 in connection with the discussions on protecting the European cultural heritage, according to which the Commission was requested to propose measures towards unifying national provisions on copyright. COM (88) 172 final, 7 June 1988. Directive 91/250 of 14 May 1991 on computer programs, codified as Directive 2009/24 of 23 April 2009. W.R. Cornish, ‘Copyright Across the Quarter-Century’, (1995) IIC, 801–12, 806. Directive 96/9 of 11 March 1996. Directive 92/100 of 19 November 1992 on lending and rental rights, replaced by Directive 2006/115 of 12 December 2006; Directive 93/83 of 27 September 1993 on cable and satellite; Directive 93/98 of 29 October 1993 on the term of protection, replaced by Directive 2011/77 of 27 September 2011; Directive 2001/84/EC of 27 September 2001 on the resale right, which belongs to the first generation despite its late adoption that was only due to the very long negotiation. The Term Directive can thus be linked to C-341/87 EMI-Electrola v Patricia [1989] ECR 79 and the Rental Right Directive to C-158/86 Warner Brothers v Christiansen.

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Society Directive of 200121 brought in this respect a noticeable change as it adopted a real horizontal approach.22 Based on a Green Paper of 199523 and designed to incorporate the 1996 WIPO Copyright Treaty (WCT) and WIPO Performance and Phonogram Treaty (WPPT) into EC law, the so-called InfoSoc Directive harmonised the most important economic rights of authors and related rights holders and, admittedly not very successfully, the exceptions to copyright and the legal protection of technological protection measures. The 2004 Enforcement Directive for its part harmonised, for all intellectual property rights, procedures and remedies in case of infringement.24 Subsequently adopted directives,25 on the other hand, resemble those of the first generation without such a transverse approach. Thus, at the end of this second period, there was still no genuine European copyright law, but rather 1.10 an approximation of national copyright legislation in respect of specific issues such as the protection of some categories of works (software, databases, photographs), the respective scope of economic rights and exceptions as well as the term of protection both in the field of copyright and related rights. Due, inter alia, to the optional character of the exceptions and to the very abstract formulation of the economic rights, the convergence of national copyright law was in fact still limited. The latitude traditionally left for the national legislature when implementing a directive, which allows for taking account of the legal and cultural traditions in each Member State, also weakened the outcome of the harmonisation process. However, as the acquis communautaire has been growing, so the ECJ started to play a crucial role.

3. The increasing role of the ECJ since 2007 Since the middle of the 2000s, the ECJ has been increasingly called upon to rule on the 1.11 interpretation of the provisions of the directives rather than to reconcile copyright with EC primary law. Because of the highly developed acquis in the field of copyright and related rights, the conflicts with the fundamental freedoms provided for in the EC Treaty have become less numerous, except for the principle of non-discrimination on the grounds of nationality. The ECJ’s case law applying Article 12 EC Treaty (former Art. 7) to copyright law26 still plays an important role and one may speak in this respect of harmonisation by case law.27 But the development of the acquis also gave rise to increasing requests for preliminary rulings from 1.12 the Member States, especially since the enlargement of the European Union. While the trend was rather slow at the beginning, with the ECJ issuing very few decisions on this topic every year and

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Directive 2001/29 of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society. Such a horizontal approach was already present in the Term Directive, which harmonises the term of protection for all kind of works (copyright) and protected subject matter (related rights), and in the Rental Directive, which harmonises related rights for four categories of rights holders, but each instrument dealt only with one specific aspect. Green Paper of 27 July 1995 on Copyright and Related Rights in the Information Society, COM (95) 382 final. Directive 2004/48 of 29 April 2004. Directive 2012/28 of 25 October 2012 on certain permitted uses of orphan works; Directive 2014/26 of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market; Directive 2017/1564 of 13 September 2017 on certain permitted uses of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled; Directive 2019/789 of 17 April 2019 laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes; Directive 2019/790 of 17 April 2019 on copyright and related rights in the Digital Single Market. See C-92/92 Phil Collins [1993] ECR I-5145; C-360/00 Ricordi [2002] ECR I-5089; C-28/04 Tod’s [2005] ECR I-05781. See below Chapter 2 by C. Sappa.

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the copyright experts having enough time to get familiar with such rulings as SGAE in 2006,28 Cassina in 2008,29 Infopaq in 200930 or Padawan in 2010,31 the pace accelerated from 2011 onwards with an average of about seven copyright cases per year. As regards the interpretation of the concept of communication to the public, the Court has already handed down some 20 judgments32 and many questions for preliminary rulings are still pending. 1.13 The ECJ has not only answered the questions it has been asked, but sometimes also decided on issues that have not even been raised.33 The Court has been applying in the field of copyright the concept of ‘autonomous notions of Community law’, which are to be interpreted uniformly in all Member States. But while these key copyright concepts were still considered to be finally defined by national courts in the Sena ruling of 2003,34 the ECJ later affirmed its exclusive competence to give an interpretation, which must have binding effect in all Member States. Thus, it gave in a very audacious way (which has been criticised by some legal scholars) a definition of such important concepts as the right of distribution in its Cassina ruling, the originality in Infopaq, the equitable compensation in Padawan and the exhaustion principle in the famous UsedSoft case.35 It has been stressed in this respect that ECJ case law now has an influence not only on the exercise, but also on the existence of copyright, a field that lies traditionally within the sole competence of the Member States.

II. THE ACHIEVEMENT OF A EUROPEAN COPYRIGHT LAW? 1. The assessment of the acquis communautaire 1.14 With no less than 13 directives and the impressive case law of the ECJ, the field of copyright and related rights has to a large part already been harmonised. Most of the core concepts are defined in quite the same way in all Member States. This is certainly true for the term of protection and the economic rights of authors and related rights holders. But even in respect of limitations to copyright protection, and despite the optional character of the list of exceptions in the InfoSoc Directive, the adoption of the three-steps test on an EU level admittedly had a harmonising effect. The question, whether a fair balance of the interests involved has thus been achieved is, however, another.36 1.15 As to some key concepts, which have not been fully harmonised in a horizontal way, a convergence of national copyright laws of the Member States can nevertheless be observed. Under the influence of ECJ case law,37 a European concept of originality has emerged, which applies to all categories of works and is a middle way between the British ‘skill and labour’ test and the German requirement of a certain level of creativity (Gestaltungshöhe). In respect of authorship and first ownership, there is indeed no true harmonisation, except for the film director.38 Strong differences remain in the

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Case C-306/05 SGAE ECLI:EU:C:2006:764. Case C-456/06 Cassina v Peek & Cloppenburg ECLI:EU:C:2008:232. Case C-5/08 Infopaq International v Danske Dagblades Forening ECLI:EU:C:2009:465. Case C-467/08 Padawan v SGAE ECLI:EU:C:2010:620. See most recently Case C-753/18 Stim & SAMI ECLI:EU:C:2020:268. Such as the concept of originality in its Infopaq ruling. Case C-245/00 Sena [2003] ECR I-1251, para. 34: ‘It is therefore for the Member States alone to determine, in their own territory, what are the most relevant criteria for ensuring […] adherence to that Community concept’ and para. 40: ‘it is not for the Court itself to lay down the criteria for determining what constitutes equitable remuneration’. Case C-128/11 UsedSoft GmbH v Oracle International Corp. ECLI:EU:C:2012:407. See below 1.21. Case C-5/08 Infopaq International v Danske Dagblades Forening ECLI:EU:C:2009:465; Case C-145/10 Eva-Maria Painer v Standard VerlagsGmbH ECLI:EU:C:2013:138; Case C-683/17 Cofermel v G-Star Raw ECLI:EU:C:2019:721. The Rental, the Satellite and the Term Directives all provide for a mandatory allocation of authorship to the principal director of a cinematographic or audiovisual work. The software and databases directives for their part leave the subject

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legislation of Member States, especially as regards works made in the course of employment and commissioned works. However, one should not overestimate the disparities, which besides do not always coincide with the divide between authors’ rights and copyright systems. Continental European countries are indeed committed to the rule of the ‘author as creator’ (Schöpferprinzip) according to which copyright originates in the individual who created the work, but most of them already provide for assumption of assignment or even true cessio legis in case of works made for hire and some of them, notably France, Italy and Spain, also provide for the category of collective work where copyright is vested in the person (in practice a legal entity) under whose name the work has been disclosed. The same is true for other issues, which have not been harmonised at all, such as moral rights. Since 1.16 all Member States of the EU have long adhered to the Berne Convention and their national copyright legislation thus already meets the requirements of Article 6bis BC, moral interests of authors already are, to some extent, protected within the EU. However, there has been a deep divide on this issue between the majority of Member States, which are civil law countries, and the only two Member States belonging to the common law tradition. In this respect, Brexit could facilitate the harmonisation of moral rights, which has been difficult so far due to the objections of the United Kingdom. In addition to substantive copyright law, convergence has also been achieved in the field of 1.17 enforcement. The implementation of the 2004/48 Directive has brought some important changes in the national copyright law of the Member States in respect of such issues as the right of information or the assessment of damages. The same applies to collective management that has been harmonised by Directive 2014/26,39 which has, however, been criticised for focusing on the licensing activities of the collecting societies, thus leaving aside their social and cultural functions.40 In any case, the key issue in the field of collective administration of copyright and related rights is whether the rules of competition law should apply without any exception to collecting societies. The real challenge here is actually to overcome the suspiciousness of the Commission in respect of the monopolistic situation of collecting societies. The most important divergences between the national copyright legislations of the Member States 1.18 certainly exist in the field of copyright contracts. Here, we find a great diversity of solutions, ranging from systems with detailed provisions aiming at protecting the author, which is seen as the weakest contractual partner, to copyright laws without any specific regulation restraining the principle of freedom of contract. Directive 2019/790 on copyright and related rights in the Digital Single Market will, however, radically change the situation. Its Chapter 3 entitled ‘Fair remuneration in exploitation contracts of authors and performers’ includes six provisions (Arts 18–23) providing for a harmonisation of copyright contract law, which have to be transposed by 7 June 2021.41

2. From European common copyright principles to a genuine European copyright law Irrespective of the gaps in the acquis communautaire just mentioned above, it can be argued that 1.19 there are today more common features than differences in the copyright legislation of all Member

39 40 41

of allocation of authorship to the law of the Member States. See however A. Quaedvlieg, ‘Authorship and ownership: Authors, entrepreneurs and rights’, in T.-E. Synodinou (ed.) Codification of European Copyright Law. Challenges and Perspectives, Kluwer, 2012, 207: ‘it looks as if the directive may have tempted to establish, by a kind of “soft law”, the creator doctrine as the basic regime, whereas deviations from this ground rule remain permitted’. Directive of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market. On this directive, see below Chapter 14 by L. Guibault, and updated by S. Jacques. A. Lucas-Schloetter, ‘Copyright Contract Law’, in T.-E. Synodinou (ed.), Pluralism or Universalism in International Copyright Law, Kluwer, 2019, 597–608.

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Chapter 1 IS THERE A CONCEPT OF EUROPEAN COPYRIGHT LAW?

States of the EU. However, these common principles do not yet constitute a genuine European copyright law. As the harmonisation process has been thus far conducted without any overall concept, the result amounts to a piecemeal patchwork. Since the European Economic Community has been replaced by a European Union, copyright law, however, should not be envisaged only in terms of free movement of goods and services and free competition anymore. Article 151, paragraph 4 EC Treaty introduced by the 1992 Treaty of Maastricht provides that the Commission must ‘take cultural aspects into account in its action under other provisions in this Treaty’. Unlike other IP rights such as patent or trademark law, copyright law, notwithstanding its increasing economic value, still has a social and cultural dimension, which should not be set aside. 1.20 The most challenging task in the process of harmonisation has long been considered to be that of reconciling the utilitarian approach of common law based copyright systems, which is deemed to be industry friendly, and the so-called ‘romantic’ vision of civil law based droit d’auteur systems, much more favourable to authors. However, the compromise that is to be achieved is rather between two fundamentally opposite basic approaches of copyright law, which both are advocated within the EU irrespective of the geographic national frontiers. The core issue is actually that of the balance of interests of three categories of protagonists in the field of copyright. 1.21 The challenge, which European (as well as national) legislature is now facing has its origin in two distinct evolutions of the past 20 years: the technical development, which enables access to and use of protected works without either any tangible medium or intermediary, as well as further online dissemination to a potentially unlimited public on the one hand; the continued extension of the scope of copyright and related rights in order to protect factual and functional works with very little creative input and to reward investment of any kind on the other hand. Both developments, the first one of technical nature, the second of legal policy, led to a change of paradigm: the balance to be achieved is no longer only between authors and producers, as the debate now focuses on the public’s claim for free access to information, which would allegedly justify more exceptions to copyright, yet the introduction of a fair use clause into European copyright law. 1.22 Copyright law being not just a matter of trade and competition, any further approximation of national legislation of the Member States within the EU should take due account of the non-economic interests of creative people such as authors and performers as well as cultural considerations. However, further integration whatever form it may take42 requires first to take a stand on the direction to be followed. European authorities should be aware of the ‘legitimacy crisis’ copyright is currently undergoing. The need to achieve ‘a high level of protection’, which is repeated in several recitals of harmonising directives and in almost every recently published document of the Commission, sounds like an incantation and does not help to improve acceptance of copyright among consumers.43 European authorities would be therefore well advised not to forget a compass when starting the journey into the terra incognita of drafting the future European Copyright Law.

III. CONCLUSION 1.23 The time has come to move from a negative integration merely based on removing the restraints of the good functioning of the internal market, to a positive one, including social, cultural and other non-economic considerations. It does not mean, however, that approximation should necessarily be

42 43

See below para. 1.23. The ‘high level of protection’ is said to benefit only producers and not creative people such as authors and performers. See, in the debate about the extension of the term of protection for the producers of sound recordings, the argument according to which such an extension in no way improves the situation of performers and it would have been better to strengthen their contractual position or at least to provide them with a right to equitable remuneration.

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III. CONCLUSION

achieved by way of an EU Regulation establishing a truly unified legal framework, which would take precedence over national law. Such a ‘European Copyright Law’ is advocated by some legal scholars and apparently also supported by European authorities. It is mainly justified by the need to reduce transaction costs and to restore a fair balance between rights and exceptions. But approximation, which does not mean unification, arguably could also be reached by way of further harmonising directives or even soft law instruments. No matter how far approximation of national copyright law of the EU Member States should go, a first step could be trying to achieve a compromise between national traditions on all key issues including those that have not been yet harmonised. In this respect, the Wittem Copyright Code deserves great attention as it is the first attempt to provide, on an academic level, some model provisions on the core elements of copyright law.44 However valuable it may be, the text first does not address such crucial issues as related rights, enforcement or collective right management, and secondly is not representative of the prevalent opinion in European continental countries.45 Proponents of an EU copyright title, which would replace national copyright law, believe the 1.24 territoriality of copyright to be anachronistic. It has been qualified as ‘the Achille’s heel of the acquis’,46 which should be abolished since it is inconsistent with the very nature of the internal market. Whereas the rule of exhaustion provides for a de facto circumvention of the territoriality in cases of distribution of tangible goods within the EU, the territorial nature of the right of communication to the public make it necessary to clear rights in all Member States except for satellite broadcasting. However, difficulties arising from the territorial scope of copyright especially in the field of online dissemination of music or audiovisual works may be overcome by way of multi-territory licenses without it being necessary to create a new EU copyright title. Thus, it remains to be seen, whether copyright law as Dietz put it in 2004 ‘will be for a long time a national matter of legislation based on the principle of territoriality of protection’ and whether there can really be ‘no such thing as European copyright law ’.47

NOTES 1. Related Instruments Berne Convention for the Protection of Literary and Artistic Works last amended on 28 September 1979. Council Directive 91/250/EEC of 14 May 1991 on the legal protection of computer programs, OJ L 122/42, 17.5.1991, codified by Directive 2009/24/EC of 23 April 2009. Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 346/61, 27.11.1992, codified by Directive 2006/115 of 12 December 2006. Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, OJ L 248/5, 27.9.1993. Council Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights, OJ L 290/9, 24.11.1993, codified by Directive 2006/116/EC of 12 December 2006 last amended by Directive 2011/77/EU of 27 September 2011. Directive 96/9/EC of 11 March 1996 on the legal protection of databases, OJ L 77/20, 27.03.96.

44 45 46 47

Wittem Group, European Copyright Code, 26 April 2010, which addresses the following issues: subject matter of copyright, authorship and ownership, moral rights, economic rights, exceptions. For a true compromise between national copyright traditions of all Member States to be achieved, it is necessary that they be equally represented, which was obviously not the case with the Wittem Group drafting committee. van Eechoud, Hugenholtz et al., Harmonizing European Copyright Law. The Challenge of Better Lawmaking, Kluwer, 2009, 307. A. Dietz, ‘Marketing and enforcing intellectual property in Europe – European Parliament versus Commission: How to deal with collecting societies?’, (2004) IIC, 820.

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Chapter 1 IS THERE A CONCEPT OF EUROPEAN COPYRIGHT LAW? Directive 2001/29/EC of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001. Directive 2001/84/EC of 27 September 2001 on the resale right for the benefit of the author of an original work of art, OJ L 272/32, 13.10.2001. Directive 2004/48/EC of 29 April 2004 on the enforcement of intellectual property rights, OJ L 157/45, 30.4.2004. Directive 2012/28/EU of 25 October 2012 on certain permitted uses of orphan works, OJ L 299, 27.10.2012. Directive 2014/26/EU of 26 February 2014 on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online use in the internal market, OJ L 84, 20.3.2014. Directive (EU) 2017/1564 of 13 September 2017 on certain permitted uses of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled, OJ L 242, 20.9.2017. Directive (EU) 2019/789 of 17 April 2019 laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes, and amending Council Directive 93/83/EEC, OJ L 130, 17.5.2019. Directive (EU) 2019/790 of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC, OJ L 130, 17.5.2019. Green Paper of 7 June 1988 on Copyright and the Challenge of Technology, COM (88) 172 final. Green Paper of 27 July 1995 on Copyright and Related Rights in the Information Society, COM(95) 382 final.

2. CJEU case law Cassina v Peek & Cloppenburg (C-456/06) ECLI:EU:C:2008:232. Coditel v CinéVog Films (C-62/79) [1980] ECR 881. Coditel v CinéVog Films II (C-262/81) [1982] ECR 3381. Cofermel v G-Star Raw (C-683/17) ECLI:EU:C:2019:721. Deutsche Grammophon v Metro (C-78/700) [1971] ECR 487. EMI-Electrola v Patricia (C-341/87) [1989] ECR 79. Eva-Maria Painer v Standard VerlagsGmbH (C-145/10) ECLI:EU:C:2013:138. Infopaq International v Danske Dagblades Forening (C-5/08) ECLI:EU:C:2009:465. Land Hessen v Ricordi (C-360/00) [2002] ECR I-5089. Musik-Vertrieb Membran v GEMA (C-55/80 and 57/80) [1981] ECR 147. Padawan v SGAE (C-467/08) ECLI:EU:C:2010:620. Phil Collins v Imtrat (C-92/92 and 326/92) [1993] ECR 1–5145. SENA v NOS (C-245/00) [2003] ECR I-1251. SGAE (Case C-306/05) ECLI:EU:C:2006:764. Stim & SAMI (C-753/18) ECLI:EU:C:2020:268. Tod’s SpA v Heyraud SA (C-28/04) [2005] ECR I-05781. UsedSoft GmbH v Oracle International Corp. (C-128/11) ECLI:EU:C:2012:407. Warner Brothers v Christiansen (C-158/86) [1988] ECR 2605.

3. Bibliography Casas Vallés, R. ‘The requirement of originality’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009. Cohen Jehoram, H. ‘Critical reflections on the economic importance of copyright’, (1989) International Review of Intellectual Property and Competition Law (IIC), 485–97. Cohen Jehoram, H. ‘The EC Copyright Directives, economics and authors’ rights’, (1994) IIC, 821–39. Cohen Jehoram, H. ‘Prohibition of parallel imports through Intellectual Property Rights’ (1999) IIC, 495–511. Cohen Jehoram, H. ‘European copyright law – ever more horizontal’, (2001) IIC, 532–45. Cornish, W.R. ‘Copyright across the quarter-century’, (1995) IIC, 801–12. Daum, F. ‘Copyright, European competition law and free movement of goods and services’, in von Lewinski, S. and Walter M. (eds), European Copyright Law, Oxford University Press, Oxford, 2010. Davies, G. ‘The convergence of copyright and authors’ rights – Reality or chimera?’, (1995) IIC, 964–89. de Werra, J. ‘The moral right of integrity’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009.

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III. CONCLUSION Derclaye, E. ‘By way of conclusion: what next?’ in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009. Derclaye, E. ‘Wonderful or worrisome? The impact of the ECJ ruling in Infopaq on UK copyright law’, (2010) EIPR, 247–51. Derclaye, E. ‘The Court of Justice copyright case law: quo vadis?’ (2014) EIPR, 716–32. Dietz, A. ‘The possible harmonization of copyright law within the European Community’, (1979) IIC, 395–411. Dietz, A. ‘The harmonization of copyright in the European Community’, (1985) IIC, 379–410. Dietz, A. ‘Marketing and enforcing intellectual property in Europe – European Parliament versus Commission: How to deal with collecting societies?’, (2004) IIC, 809–20. Dreier, T. ‘The Role of the ECJ for the development of copyright in the European Communities’, (2007) Journal of the Copyright Society of the USA, 54, 183–230. Ginsburg, J.C. ‘European Copyright Code – Back to the first principles (with some additional detail)’, (2011) Auteurs & Media, 1, 5. Gotzen, F. ‘The European legislator’s strategy in the field of copyright harmonisation’, in T-E. Synodinou (ed.), Codification of European Copyright Law. Challenges and Perspectives, Kluwer, The Netherlands, 2012. Gotzen, F. ‘How Can Greater Harmonisation or Unification of Copyright Be Achieved in the European Union?’ (2017) Revue Internationale de Droit d’Auteur (RIDA) 252, 4-42. Handig, H. ‘The copyright term “work” – European harmonisation at an unknown level’, (2009) IIC, 665–85. Hilty, R.M. ‘Intellectual property and the European Community’s internal market legislation – Copyright in the internal market’, (2004) IIC, 760–75. Hugenholtz, P.B. ‘Copyright without frontiers: The problem of territoriality in European copyright law’, in Derclaye, E. (ed.) Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009. Hugenholtz, P.B. ‘The Wittem Group’s European Copyright Code’, in Synodinou, T-E. (ed.), Codification of European Copyright Law. Challenges and Perspectives, Kluwer, The Netherlands, 2012. Hugenholtz, P.B. ‘Neighbouring rights are obsolete’, (2019) IIC, 1006–11. Institute for Information Law, The Recasting of Copyright and Related Rights for the Knowledge Economy, Amsterdam 2006. Leistner, M. ‘Copyright law in the EC: Status quo, recent case law and policy perspectives’, [2009] CMLR, 46, 847–84. Loewenheim, U. ‘Intellectual property before the European Court of Justice’, (1995) IIC, 829–50. Lucas-Schloetter, A. ‘The acquis communautaire in the area of copyright and related rights: Economic rights’, in Synodinou, T-E. (ed.), Codification of European Copyright Law. Challenges and Perspectives, Kluwer, The Netherlands, 2012. Lucas-Schloetter, A. ‘Copyright Contract Law’, in Synodinou, T-E. (ed.), Pluralism or Universalism in International Copyright Law, Kluwer, The Netherlands, 2019. Metzger, A. ‘Der Einfluss des EuGH auf die gegenwärtige Entwicklung des Urheberrechts’, (2012) GRUR, 118–26. Michaux, B. ‘L’originalité en droit d’auteur, une notion davantage communautaire après l’arrêt Infopaq ’, (2009) Auteurs & Media, 473–88. Möller, M. ‘Urheberrecht oder Copyright’, (1990) ZUM, 65–70. Nérisson, S. ‘Has collective management of copyright run its course? Not so fast’, (2015) IIC, 505–7. Newmann, S. ‘The development of copyright and moral rights in the European legal systems’, (2011) EIPR, 33, 677–89. Ohly, A. ‘Economic rights’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009. Peifer, K-N. ‘Urheberrechtsharmonisierung in Europa’, (2011) Zeitschrift für Geistiges Eigentum (ZGE)/ Intellectual Property Journal (IPJ) 3, 329–42. Quaedvlieg, A. ‘Authorship and ownership: Authors, entrepreneurs and rights’, in T.-E. Synodinou (ed.), Codification of European Copyright Law. Challenges and Perspectives, Kluwer, The Netherlands, 2012. Rahmatian, A. ‘European copyright inside or outside the European Union: Pluralism or copyright laws and the “Herderian Paradox”’, (2016) IIC, 912–40. Reimer, D. ‘Copyright law and the free movement of goods’, (1981) IIC, 493–510. Schack, H. ‘Europäische Urheberrechts-Verordnung: erwünscht oder unvermeidlich?’, (2009) Zeitschrift für Geistiges Eigentum (ZGE)/ Intellectual Property Journal (IPJ), 275–91. Schricker, G. ‘Harmonisation of copyright in the European Economic Community’, (1989) IIC, 466–84. Schricker, G. ‘Urheberrecht zwischen Industrie- und Kulturpolitik’, (1992) GRUR, 242–7. Schricker, G., Bastian E. and Dietz A. (eds.), Konturen eines europäischen Urheberrechts, Nomos, Baden-Baden, 1996.

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Chapter 1 IS THERE A CONCEPT OF EUROPEAN COPYRIGHT LAW? Schulze, G. ‘Schleichende Harmonisierung des urheberrechtlichen Werkbegriffs?’, (2009) GRUR, 1019–22. Synodinou, T-E. ‘The lawful user and a balancing of interests in European copyright law’, (2010) IIC, 819–43. Synodinou, T-E. ‘The foundations of the concept of work in European Copyright Law’, in T-E. Synodinou (ed.), Codification of European Copyright Law. Challenges and Perspectives, Kluwer, The Netherlands, 2012. Synodinou, T.-E. ‘Geoblocking in EU Copyright Law: challenges and perspectives’, (2020) GRUR Int, 136–50. Ubertazzi, L.C. ‘Copyright and the free movement of goods’, (1985) IIC, 46–75. van Eechoud M. ‘Along the road to uniformity – diverse readings of the Court of Justice judgments on copyright work’ (2012) JIPITEC, 60–80. van Eechoud, M., Hugenholtz P.B. et al., Harmonizing European Copyright Law. The Challenge of Better Lawmaking, Kluwer, The Netherlands, 2009. von Lewinski, S. and Walter M., ‘Status of harmonization and outlook’, in von Lewinski, S. and Walter M. (eds), European Copyright Law, Oxford University Press, Oxford, 2010. von Ungern-Sternberg, J. ‘Urheberrechtliche Verwertungsrechte im Lichte des Unionsrechts’, (2012) GRUR, 1198–206. Xalabarder, R. ‘The role of the CJEU in harmonizing EU copyright law’, (2016) IIC, 635–39.

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2 THE PRINCIPLE OF NON-DISCRIMINATION Cristiana Sappa I.

INTRODUCTION

2.01

II. NON-DISCRIMINATION VIA THE PRINCIPLE OF NATIONAL TREATMENT IN THE INTERNATIONAL LEGAL FRAMEWORK ON COPYRIGHT AND RELATED RIGHTS 1. Notion and scope of National Treatment 2. Origin and development of the National Treatment obligation 3. Exceptions to National Treatment: can they be overruled? 4. Next to National Treatment: the MFN clause

2.09 2.09 2.12

III. NON-DISCRIMINATORY TREATMENT VIA THE PRINCIPLE OF NATIONAL TREATMENT IN THE EU LEGAL FRAMEWORK 1. General remarks 2. CJEU case law: some milestones 3. Exceptions to the National Treatment principle

2.28

IV. CONCLUSION

2.30

2.20 2.20 2.24

2.17 2.18

I. INTRODUCTION Intellectual Property Rights (IPRs) are recognized and enforceable within the limits of the State 2.01 that granted them. The principle of territoriality governing all IPRs, including copyright, is embedded in all national legal systems in compliance with the TRIPs Agreement, and therefore in the EU legal system, too.1 The main implication of the territoriality principle is that the law applying to any IPR exploitation or infringement is the law of the country where such an exploitation or infringement occurs.2 Thus, a rule regarding choice of law3 is needed in order to avoid – or at least limit – the discriminatory treatment deriving from such a territoriality paradigm. As applied to copyright and related rights protection, non-discrimination enables authors or artists 2.02 to start a legal action when they are directly or indirectly treated in a less favourable way than some other creators or performers.4 This principle can be analysed in several perspectives. First, 1

2

3 4

G.B. Dinwoodie, ‘Developing a Private International Intellectual Property Law: the Demise of Territoriality’, in William & Mary L. Rev. 2009, 711ff.; A. Peukert, ‘Territoriality and Extraterritoriality in Intellectual Property Law’, in G. Handl and J. Zekoll (eds), Beyond Territoriality: Transnational Legal Authority in an Age of Globalization, Martinus Nijhoff, Leiden, 2011, 194ff.; P. Torremans, ‘Copyright Territoriality in a Borderless Online Environment’, in J. Axhamn, Copyright in a Borderless Environment, Norstedts Juridik, Stockholm, 2012, 23ff. In the EU see art. 8.1 of Regulation 864/2007/CE of July 11, 2007 on the Law Applicable to Non-Contractual Obligations, available at http://www.cr-international.com/2007_EU-Commission_Regulation_Rome_II_11.7.pdf (Regulation Rome II). On the judiciary aspects of this statement S. Foà, ‘Territorialità dei diritti IP e riparto delle competenze amministrative’, in AIDA 2012, 198ff., focusing also on the weakening of the ‘State of Act’ doctrine. Contra: G. Koumantos, ‘Sur le droit international privé du droit d’auteur’, in IDA 1979, 616ff., arguing that the Berne Convention would suggest the application of the law of the country of origin. See relevant remarks on territoriality and neighboring rights in L.C. Ubertazzi, ‘La territorialità dei diritti del produttore fonografico, dell’artista e dell’IMAIE’, in AIDA 1992, 91ff., spec. 100 and 101 and note 11. V-L. Bénabou, Droit d’auteur, droit voisins et droit communautaire, Bruylant, Brussels, 1997, n. 289. In principle, non-discrimination is a distinct issue from conflict of law and has no impact on it. However, this statement may be nuanced. The applicable law cannot be impacted by art. 3.1 of TRIPs Agreement or by art. 18 TFEU as long as it is linked to a State by an objective connection, with no distinction based on the nationality of right owners or their works.

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Chapter 2 THE PRINCIPLE OF NON-DISCRIMINATION

non-discrimination could concern the protectable subject matter: one could ask why flavours or fragrances generally receive no protection,5 while photography or software do. Second, one could ask how to justify different rules for private subjects and public bodies. Both these perspectives can be analysed and solved under the constitutional law angle. Traditionally, however, the nondiscrimination principle in copyright is studied in a geographical perspective governed by private international law. The main question afforded by judges and commentators is whether and how a different treatment based on the nationality of authors and artists can be justified by objective reasons. This work studies this last question only, i.e., the principle of non-discrimination based on nationality of creators and performers. Thus, the impact of such a principle on different genres of works of art, or on public and private creations, will be merely analysed within this perspective. 2.03 The principle of non-discrimination requires to avoid less favourable treatment for some individuals, groups or legal persons, irrespectively of each one’s peculiarities. This principle is rooted in the natural law philosophy. First recognized in the Bill of Rights of the Northern American colonial States and in the French Declarations of Human Rights and Civil Rights of 1789 and 1793, it has since been incorporated in nearly all international treaties and conventions on human rights,6 such as the Universal Declaration of Human Rights (UDHR) and the International Covenants of 1966. The provision of non-discrimination also applies to the rights recognized in the respective declarations, treaties or agreements. It can also be found in national constitutions. Its presence in these legal instruments legitimates it as a fundamental principle and a human right. 2.04 The natural law quality is argued to be one of the distinctive features of the author’s rights system, at least in civil law countries.7 Such a qualification as a natural right, imposes that every creator shall enjoy protection by nature, no matter what her nationality is or the place where the work was first published. In addition, several legal instruments, such as Article 27.2 of the UDHR, promote the protection of moral and economic interests of creators, thus referring to copyright as a specific human right.8 Should authors’ rights be natural rights, special rules of non-discrimination would not be necessary. In the same way, the presence of copyright among the set of fundamental rights supports the argument that special rules of non-discrimination would therefore not be needed. 2.05 The international copyright legal framework does not refer expressis verbis to non-discrimination. However, this principle would have the operational aim of ensuring effective protection and rights enforcement, in order to facilitate the achievement of global trade in copyright protected goods.9 This is one of the reasons why copyright rules embed one provision that is considered as the standard for introducing non-discrimination within the framework of works of art. It is the principle of National Treatment, which prohibits internal trade discrimination and appears in the major multilateral treaties concerning copyright and related rights, i.e., the Berne Convention, the Rome Convention, the TRIPs Agreement and the WIPO Treaties of 1996 and the Bejing

5 6 7

8 9

See on this L. Van Bunnen, ‘L’interdiction CEE de toute discrimination en fonction de la nationalité dans le droi d’auteur in s’oppose-t-elle à une certaine reciprocité?’, in Liber Amicorum Aimé de Caluwé, Bruylant, Brussels, 1995, 355ff. See also pts 34 and 35 of the decision of CJ, 20 October 1993, Case C-92/92 and C-326/92, Phil Collins v Imtrat and Patricia v EMI Electrola, in RIDA 1/1994, 304ff. As to tastes see CJ, 13 November 2018, C-310/17, Levola Hengelo BV v. Smilde Foods BV; as to scents French Supreme Court (Cass. Comm.), 13 December 2013, n. 11-19872, Lancôme. S. von Lewinski, Intellectual Property, Nationality and Non Discrimination, available at http://www.wipo.int/export/sites/ www/tk/en/hr/paneldiscussion/papers/pdf/lewinski.pdf, 2ff. However, see for a different approach J. Ginsburg, ‘A Tale of Two Copyrights: Literary Property in Revolutionary French and America’, in B. Sherman and A. Strowel (eds), Of Authors and Origins. Essays on Copyright Law, Oxford University Press, Oxford, 1994, 131ff. In this sense, see also art. 17.2 of the Charter of Nice of 2001. H. Grosse Ruse-Khan, ‘Principles for Intellectual Property Provisions in Bilateral and Regional Agreements’, IIC 2013, 878ff., refers to IP protected goods and services and stresses the fact that this goal is achieved by the principle of non-discrimination together with minimum standards.

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I. INTRODUCTION

Treaty on Audiovisual Performances.10 Together with this rule, other standards are referred in to different international legal instruments.11 The National Treatment clause refers to people and not to products12 and it provides a substructure for the transformation of conflict into a mutually beneficial social order.13 In copyright law, the principle of National Treatment (together with the Most-Favoured-Nation 2.06 (MFN) clause and other standards) ensures a non-discriminatory treatment to authors, artists and performers. More precisely, it implies the principle of territoriality and can be looked as a non-discrimination via a choice of law rule.14 This principle shows some differences when compared to the general one of non-discrimination 2.07 under human rights, in particular as to its justification, but also as to its historical background and scope. This led some commentators to ask how the two sets of rules relate to each other at both the international15 and national level. In particular, the relationship between different sets of rules is crucial to understand whether a non-discriminatory treatment should be granted to authors and performers on the ground of general human rights conventions, even in the lack of such an obligation in IPRs and more particularly in copyright treaties and conventions. Should the answer be positive, exceptions to National Treatment introduced by the specific copyright conventions and treaties16 in particular could hardly be justified and implemented. It does not seem, however, that treaties and conventions on human rights contain an obligation of 2.08 non-discrimination that could be extended to IPRs. This is why the exceptions to the National Treatment, introduced by international legal instruments, such as the Berne Convention or the TRIPs Agreement, cannot be overruled through the general obligation of non-discrimination deriving from human rights legal instruments (section II). Nevertheless, some of these exceptions can be limited at the regional level. In particular, with the purpose of favouring the regional integration, some rules of formal or material reciprocity as indicated in the above-mentioned Berne Convention and TRIPs Agreement are replaced by the principle of National Treatment within the European Union. Consequently, a more effective non-discriminatory treatment via the National Treatment principle in particular can be implemented within this regional framework (section III).

10

11 12

13 14 15 16

Some legal instruments do not contain the principle of National Treatment, such as the Geneva Phonograms Convention and the Brussels Satellite Convention. They leave it to the Contracting States to choose the legal means of protection, as reported by U. Loehwenheim, ‘The Principle of National Treatment in the International Conventions on Intellectual Property’, in W.P. Pyrmont, M.J. Adelman, R. Brauneis, J. Drexl and R. Nack (eds), Patents and Technological Progress in a Globalized World, MPI Studies on Intellectual Property, Competition and Tax Law, Springer, Berlin, Heidelberg, 2009, 593ff. In particular, on the most-favoured-nation clause see infra II.4. Fikentscher, in Beier and Schricker (eds), GATT or WIPO? New Ways in the International Protection of Intellectual Property, IIC Studies. Studies in Industrial Property and Copyright Law, 1988, 99ff. This principle has exceptions, exactly like the same National Treatment clause in GATS, which has two main exceptions: Economic Integration (art. V) and the General Exceptions (art. XIV). On this see F. Ortino, ‘The Principle of Non-Discrimination and its Exceptions in GATS: Selected Legal Issues’, presented at Conflict and Crises? – The WTO after Hong Kong, Vienna, 24–25 April 2006. G. Evans, ‘TRIPs and the Sufficiency of Free Trade Principles’, JWIP 1999, 707ff., questioning whether this principle is a sufficient underpinning for the universalization of substantive norms of law. J. Drexl, ‘The Proposed Rome II Regulation: European Choice of Law in the Field of Intellectual Property’, in J. Drexl and A. Kur (eds), Intellectual Property and Private International Law: Heading for the Future, Hart, London, 2005, 151ff. von Lewinski, note 6, in particular, 25ff. See infra, on the international legal framework, in particular with reference to Berne Convention and the TRIPs Agreement.

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II. NON-DISCRIMINATION VIA THE PRINCIPLE OF NATIONAL TREATMENT IN THE INTERNATIONAL LEGAL FRAMEWORK ON COPYRIGHT AND RELATED RIGHTS 1. Notion and scope of National Treatment 2.09 National Treatment enables the avoidance of discriminatory practices in territoriality-based legal systems.17 The principle means that citizens (creators or performers) of States Y and Z must not receive a less favourable protection than nationals of State X. This is aimed at determining the minimum level of protection only: any provision exceeding the minimum protection ex iure conventionis is accessible by foreign authors assimilated to nationals.18 As a consequence, foreigners are assimilated to nationals as to the rights’ existence, scope, maintenance, enforcement and probably their transfer.19 The principle then opposes the rule of reciprocity,20 since it may guarantee a protection that does not exist in the country of origin. 2.10 In principle, National Treatment ‘allows [a treaty] member and its courts to apply their own law, the law they are familiar with’.21 In an operational perspective, this is facilitating processes, even in presence of the progressive weakening of the ‘State of Act’ doctrine.22 In a teleological perspective, this means that the principle aims at circumventing conflicts of laws. More generally, the goal perceived is to avoid any discrimination for non-nationals because of their status as foreigners.23 2.11 In a field where international rules do not contain exhaustive provisions on remedies and procedures, National Treatment (in particular together with MFN) clearly plays a role in favouring the uniformity of copyright law. Such a role could not have been played, nor could the same results have been reached via formal or material reciprocity obligations.24 All this is supposed to enhance legal certainty, efficiency and foreign investments.

2. Origin and development of the National Treatment obligation 2.12 The national laws on IPRs already existing in the eighteenth century developed on a territorial basis. Since its infancy, copyright was protected within the limits of specific countries adopting such a protection. As a consequence, beneficiaries of national copyright laws were nationals or, sometimes, also those who published their works in the country. The question advanced was whether aliens had to be protected at all and, if that were the case, which legal technique would have saved their interests. As already mentioned, the natural law philosophy was at the basis of the preference for a universal copyright law rather than a system of different national laws. However, the idea of adopting a uniform law was soon revealed to be unrealistic. Thus, bilateral and multilateral

17 18 19 20 21 22 23

24

Torremans, note 1, 23ff., studies the interferences between territoriality and National Treatment, with a focus on the online realm. There is no ceiling for the protection of authors. The point is under debate. See M. Bertani, ‘Sub art. 5 Convenzione di Berna’, in L.C. Ubertazzi, Commentario breve alle leggi di proprietà intellettuale e concorrenza, 4 ed. CEDAM, Padoue, 2007, 1465ff. It also determines its end according to A. Lucas, ‘Droit international privé et droit d’auteur’, in Les Cahiers de propriété intellectuelle, October, 2010, vol. 22, n. 3, 761ff. Loehwenheim, note 10, 593ff.; S. Ricketson and J. Ginsburg, International Copyright and Neighbouring Rights. The Berne Convention and Beyond, 2 ed., Oxford University Press, Oxford, 2006. Foà, note 2. The principle of National Treatment together with other elements embedded into national copyright acts reveal a contradiction to the thesis of natural rights and has led some commentators to conclude that the natural law philosophy is only one component explaining the recognition of authors’ rights. A positivist approach influenced the legislation on this matter: A. Strowel, Droit d’Auteur and Copyright. Divergences and Convergences, Bruylant, Brussels, 1993, 107ff. Id., ‘Droit d’auteur and copyright: Between history and nature’, in Sherman and Strowel (eds) note 7, 246ff. Ricketson and Ginsburg, note 21.

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conventions developed introducing first formal and then material reciprocity.25 Under these conventions, every contracting party agreed to assume the treaty obligations because the other contracting party was doing the same. These ad hoc solutions were not satisfactory for authors whose works were exploited beyond the national borders in countries with which no convention was signed. In addition, this approach created a very unclear overall framework with negative consequences in terms of legal security.26 Still, some protection beyond the limits of a single country was deemed necessary for several reasons, such as piracy prevention, incentive to create new works and protection of cultural diversity in different countries.27 This need was very much felt in particular with the advent of the Industrial Revolution, which hastened the production and circulation of works, among others. In order to have a legal framework more adapted to the needs of the community, the best 2.13 compromise possible seemed to be the one of assimilating foreigners to nationals on the basis of a principle of National Treatment in the context of different national acts. So, from 1883 onwards the principle of National Treatment was introduced in the international conventions – first – and treaties – later – on (IPRs and) copyright. In particular, as far as copyright is concerned, the Berne Convention of 1886 adopted a broad principle of National Treatment combined with a number of minimum standards to be granted. The Rome Convention and the TRIPs Agreement followed this approach.28 In 1886, the Berne Convention adopted a broad principle of National Treatment combined with a 2.14 number of minimum standards to be granted, whatever the national law provisions stated. Article 5.1 of the Berne Convention indicates that ‘authors shall enjoy, in respect of protected works, in countries of the Union other than the country of origin, the rights which their respective laws do now or may hereafter grant to their nationals, as well as the rights specially granted by this Convention’. This norm concerns protection in countries other than the country of origin where full protection under the Berne Convention may be claimed, whereas the country of origin domestic law governs protection in the country of origin. So, authors who are not nationals of the country of origin must not be discriminated against under such domestic law.29 This principle covers any future legislative amendments increasing the national protection as well. The country of origin is defined

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26 27 28

29

For instance, Denmark extended the provisions of its copyright law to foreign works on condition of reciprocity in 1828. The Kingdom of Prussia signed 32 bilateral agreements based on formal reciprocity between 1827 and 1829, as reported by S. Ricketson, ‘The Birth of the Berne Union’, Colum VLA J.L. & ARTS 1986, 9. In 1840, a bilateral copyright agreement was signed between Austria and Sardinia as indicated by L. Bently and M. Kretschmer (eds), ‘Bilateral Treaty between Austria and Sardinia, Vienna (1840), Primary Sources on Copyright (1450–1900)’, available at: http://www.copyrighthistory.org/cam/tools/request/showRecord.php?id=record_d_1840; this latter was based on material reciprocity, which established parity between the levels of protection accorded by each State to each other’s work. In particular, material reciprocity has always been perceived as the tool to incite countries, with no high level of protection to increase it in cases where diversity of national law is considerably high. See on this the Case Bob Dylan of the German Constitutional Court, in GRUR 1990, 438ff. Case Bob Dylan, ibid. S. Ricketson, The Berne Convention for the Protection of Literary and Artistic Works: 1886–1986, Oxford University Press, Oxford, 1987, 5.3ff. The Universal Copyright Convention and the WIPO Treaties also followed this approach. In particular, WIPO Treaties refer to the principle of National Treatment in two different ways. Art. 3 of WCT refers to the Berne Convention, stating it applies mutatis mutandis. Agreed statement concerning art. 3 explains that the reference of the Berne Convention to a ‘national of one of the countries of the Union’ means in regard to an intergovernmental organization that is a Contracting Party to WCT, a national of one of the countries that is member of that organization. Art. 4 of WPPT Each Contracting Party shall accord to nationals of other Contracting Parties, as defined in art. 3(2), the treatment it accords to its own nationals with regard to the exclusive rights specifically granted in this Treaty, and to the right to equitable remuneration provided for in art. 15 of this Treaty. (2) The obligation provided for in para. (1) does not apply to the extent that another Contracting Party makes use of the reservations permitted by art. 15(3) of this Treaty. Ricketson, note 27, 5.64 ff, indicates that the foreign authors are entitled to the same protection as nationals, but may not benefit from the minimum rights. However, the minimum rights are usually provided for under national law.

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for published works by its first publication. In case of unpublished works or those works first published in a country outside the Union without simultaneous publication within the Union, the country of origin is determined by reference to the nationality of the author. This norm has to be read together with Articles 3 and 4 of the Berne Convention. These latter indicate the scope of application of the principle of National Treatment. Accordingly the beneficiaries of the National Treatment can be identified on the basis of some criteria: nationality or habitual residence of the authors or different points of attachment regarding the work, namely first publication, nationality of the maker of cinematographic work and location of a building or other structure.30 In particular, the chance to obtain Berne Convention protection through a first publication is an extension of possibilities for authors who are not nationals of a country of the Union, nor have their habitual residence there.31 2.15 The Rome Convention on the protection of some related rights explicitly constructs its National Treatment principle by referring to criteria beyond the nationality of protected classes of persons. According to this Convention, different points of attachment are provided for the protection of performers, phonogram producers and broadcasting organizations. As to performers, points of attachments are the place of the performance or the incorporation in a phonogram (protected under art. 5), or the broadcast of a performance, which is not fixed in a phonogram (art 6). As to phonogram producers, the points of attachment are the nationality of the producer, the first fixation and first publication of the phonogram. As to the broadcasting organizations, the points of attachment are the headquarters of the organizations or the transmission of the broadcast from a transmitter situated in another contracting State. More precisely, Member States cannot discriminate against performances between nationals and non-nationals that took place, were first fixed or broadcasted in a foreign country, any more than they can discriminate on the basis of the performer’s nationality.32 Then, the Convention protects non-national producers of phonograms as if they were domestic producers for the phonograms that they first fixed or published in their own State. The same principle applies to non-national broadcasters, who are protected as those with headquarters located in their own State that are able to broadcast from domestically located transmitters. This Convention covers only international situations: the relevant criterion must be related to a Contracting State other than the one in which the protection is claimed. The Rome Convention introduces a principle of National Treatment more limited if compared to the one offered by the Berne Convention; of course, this has an impact on the extent of protection. First, the National Treatment granted to own nationals is granted to other nationals only if further requirements are fulfilled (such as the performance, broadcast or first fixation in the territory regarding a performance, or the first fixation or first publication in the territory regarding phonograms). Second, the National Treatment is subject to the protection and the limitations specifically

30

31

32

Arts 3 and 4 of the Berne Convention indicate that the National Treatment applies to (i) nationals of one of the countries of the Berne Union, (ii) those who have their habitual residence in one of these countries or (iii) those not nationals of one of these countries but with a work first published in one of these countries or simultaneously in a country within the Union and in a country outside the Union, (iv) makers of cinematographic works whose headquarters or habitual residence is in one of the countries of the Union, and (v) creators of works of architecture erected in a country of the Union and for authors of other artistic works which are incorporated in a building or other structure located in a country of the Union. This solution goes beyond the one adopted by the Paris Convention, where nationals from countries outside the Union may obtain protection only if they are domiciled or have their real and effective industrial establishment in the territory of one of the countries of the Union. As to cinematographic works, architectural works and works incorporated in works of architecture, the relevant criteria for the eligibility of protection under art. 4 of the Berne Convention have to be fulfilled in addition to nationality in order to determine the country of origin: Art. 5(4)(c)(i) and (ii) of the Berne Convention. See von Lewinski, note 6, 9 and 10ff. In the case of performers, for example, art. 2(1)(a) of the Rome Convention provides that the level of treatment guaranteed is not just that which Contracting States accord to performers that are its own nationals, but that which Contracting States accord to such performers ‘as regards performances taking place, broadcast, or first fixed, on its territory’.

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II. NON-DISCRIMINATION VIA THE FRAMEWORK ON COPYRIGHT AND RELATED RIGHTS

provided for in the Rome Convention. This norm is generally intended as covering only the minimum standards of the Convention.33 While the National Treatment in the GATT Agreement34 was different in many ways from the 2.16 National Treatment under IPRs conventions, the TRIPs Agreement followed the National Treatment provisions of the Rome and Berne Conventions.35 The National Treatment embedded in Article 3 of the TRIPs Agreement36 and its exceptions – as provided under the relevant IPR conventions – remained untouched even by the MFN in Article 4 of the TRIPs Agreement.37 Nationality is not the only criterion for eligibility to determine the beneficiaries of protection: Article 3(1) defines the term nationals by reference to natural or legal persons that would meet the criteria for eligibility for protection provided for in the relevant conventions. This wording avoids repeating Articles 3 and 4 of the Berne Convention in the text of the TRIPs Agreement. Overall, it has to be noted that the National Treatment principle seems to be more important under the GATT in the context of internal regulation and taxation of goods than it is under the TRIPs Agreement in the context of IPRs. This is suggested in particular by the absence of complaints on copyright and related rights under the WTO Dispute Settlement Procedure compared to the substantial number of GATT complaints.

3. Exceptions to National Treatment: can they be overruled? As Robert Brauneis indicates, the impact of National Treatment may be limited on three different 2.17 levels.38 First, the value of literary and artistic works imported into one country from another may be limited and this would affect the economic impact of granting broader protection to those works.39 Empirical analysis is needed for assessment purposes related to this. Second, the principle of National Treatment has exceptions, which cannot be overruled by the general non-discrimination principle embedded into human rights treaties. More precisely States have negotiated exceptions to the National Treatment obligation in areas in which the latter would lead to major imbalances in the scope of protection. National Treatment is left to cover rights of less economic consequence. Therefore, treaties may limit the scope of operation of National Treatment via explicit exceptions whose structure or substantive minimum requirements limit its rule.40 The Berne Convention introduces a number of exceptions to National Treatment. Material reciprocity is admitted in special cases where the application of National Treatment would have resulted in a strong imbalance between countries: this is the case for the so-called comparison of terms of protection (art. 7.8), the one on models and designs (art. 2.7, phrase 2), the resale right (art. 14ter(2)), the possible retaliation against back-door protection (art. 6), the application in time (art. 18) and the reservation of the ten-year period regarding translations (art. 30.2(b), part 2). Under the Rome Convention, the room for exceptions to National Treatment is limited, given the limited extension of the latter. In fact, only three exceptions exist: the first two relate to the rights of remuneration for secondary uses of 33 34 35

36

37 38 39 40

As indicated in arts 7, 10 and 12–14 of the Berne Convention. General Agreement on Tariffs and Trade, Oct. 30, 1947, 55 U.N.T.S. 194, art. III. D. Gervais, The TRIPs Agreement. Drafting History and Analysis, London 1998, notes 2.23 ff. The same approach is also followed by the WIPO Treaties of 1996 (see art. 3 of WCT and art. 4 of WPPT). Also, the larger trade treaties continue to make the national principle one of their main principles. The wording used in art. 3(1) of the TRIPs Agreement may stimulate doubts on the nature of this clause: ‘no less favourable treatment’ could be considered as a different provision than National Treatment. M.M. Walter and L. Riede, ‘Principle of non-discrimination under the EC Treaty,’ in M.M. Walter and S. Von Lewinski (eds.), European Copyright Law. A Commentary, Part I, Oxford University Press, Oxford, 2010, 39ff, do not seem to exclude this reading of the norm. See infra II.4. R. Brauneis, ‘National Treatment in Copyright and Related Rights: How Much Work Does It Do?’, 2013, GW Law Faculty Publications and Other Works, 810, https://scholarship.law.gwu.edu/faculty_publications/810. Ibid. Ibid.

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phonograms for broadcasting and communication to the public under Article 12 (art. 16(1)(a)(iii) and (iv)); the third relates to the right of communication for broadcasting organizations under Article 13(d) (art. 16(1)(b) second half phrase).41 In addition to that, the TRIPs Agreement took over the exceptions to National Treatment provided in the relevant Conventions, such as the cases of reciprocity in the Berne Convention.42 Third, countries may or may not offer copyright protection that exceeds minimum requirements imposed by conventions and treaties. Should any additional protection be offered, it may be provided by many countries, thus limiting the divergence of a National Treatment rule from that of a rule of material reciprocity.43

4. Next to National Treatment: the MFN clause 2.18 The protection of copyright (and IPRs) is predominantly shaped by the principle of National Treatment and minimum standards. Together with the principle of National Treatment, though, another clause in particular is aimed at preventing discriminatory action and the reduction of trade barriers as well as to open the Members’ markets. The TRIPs Agreement contains the MFN treatment clause, whose goal is to ensure that any advantage provided to one Member State of the Union is equally extended to all other Member States.44 Thus, the MFN clause in TRIPs refers to people and not to products, exactly as for National Treatment. Then, thanks to the MFN principle in TRIPs, rather than exclusive trading privileges, all World Trade Organization Member countries should obtain an equivalent level of protection when a more extensive protection, via concessions, privileges, or immunities is granted to foreigners.45 Although its name implies favouritism towards another nation, it denotes the equal treatment of all countries. Within the IPRs framework, this principle plays a major role as to the liberalization efforts of the circulation of intangibles. The MFN principle in TRIPs is important because of its link to regional integration. Article 4 of TRIPs was drafted in order to accommodate the interests of some pre-existing regional arrangements. However, Article 4(d) of TRIPs suggests that accommodation is oddly suited to such a purpose. In fact, regional arrangements affected by it have to be notified to the Council for TRIPs; the state of the art shows that potentially broad claims of exemption can be notified and that the effect of these claims remains to be determined.46 2.19 The MFN and National Treatment principles are considered the cornerstones and nondiscrimination aimed rules of the WTO. Currently, it is possible to remark on a flourishing proliferation of regional Free Trade Agreements (FTAs) as an institutionalization of economic integration. Most of the time, such FTAs embed IPRs – and therefore copyright, too – clauses. The consequence is that the MFN principle today is more an exception than the general rule. The 41 42

43 44

von Lewinski, note 6, in particular, 15ff. The National Treatment provisions of the Berne Convention are also included in the compliance clause of art. 9(1), phrase 1 of the TRIPs Agreement. As to the Rome Convention, the same approach is maintained. See on this, von Lewinski, ibid., 12ff. Brauneis, note 38. Art. 4 of the TRIPs Agreement states that: With regard to the protection of intellectual property, any advantage, favor, privilege or immunity granted by a Member to the nationals of any other country shall be accorded immediately and unconditionally to the nationals of all other Members. Exempted from this obligation are any advantage, favor, privilege or immunity accorded by a Member: […] (d) deriving from international agreements related to the protection of intellectual property which entered into force prior to the entry into force of the WTO Agreement, provided that such agreements are notified to the Council for TRIPS and do not constitute an arbitrary or unjustifiable discrimination against nationals of other Members.

45 46

On the MFN, C. Correa, Trade Related Aspects of Intellectual Property Rights, Oxford University Press, Oxford UK, 2007, 66ff. Some interesting remarks on the MFN and its potential effect can be found in J. Drexl, ‘IP in Bilateral Trade Agreements. Some Ideas on How They Promote Market Power and Distort International Competition’, in G. Ghidini and L.M. Genovesi (eds), Intellectual Property and Market Power, Eudeba, Buenos Aires, 2008, 525ff.

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liberalization of trade involved in FTAs concerns some chosen partners only and therefore it is discriminatory. Under the GATT rules, such a discrimination is possible to the extent the FTAs are regional legal instruments. It has, however, to be noted that more and more FTAs’ geographical scope is far beyond the ‘regional’ one. Adjacent countries are often already involved in FTAs, so these agreements go inter-regional and engage countries – in different continents, too – with aligned aims, policy and economics. On the other hand, they cover a broad range of subject matter, which does not necessarily fit with the term ‘trade’ of goods and services: for instance, they may include principles of cooperation, international production and foreign direct investments, thus becoming one of the main regulatory forms of economic cooperation on a global scale. Within this broad framework, it is hard to see how the non-discrimination aim that MFN is supposed to ensure can be utterly respected.

III. NON-DISCRIMINATORY TREATMENT VIA THE PRINCIPLE OF NATIONAL TREATMENT IN THE EU LEGAL FRAMEWORK 1. General remarks As a first remark, the TRIPs Agreement has been part of Community law and is currently part of 2.20 the EU law. Consequently, the general obligation of National Treatment embedded both in TRIPs and in the Berne Convention has to be considered as part of EU copyright law. This leads the Court of Justice of the European Union (CJEU or Court of Justice) to interpret the scope of such a principle and its interpretation binds all EU Member States.47 Article 7 of the Rome Treaty on the Economic European Community forbade any discrimination 2.21 on grounds of nationality within the scope of application of this Treaty and without prejudice to any special provisions contained therein.48 This norm was replaced first by Article 12 of the European Community, and then by Article 18 of the currently in force Lisbon Treaty on the Functioning of the European Union (TFEU), which now states the same principle with an identical wording. In addition, the principle of non-discrimination is also confirmed at the level of fundamental rights by Article 21 of the Charter of Fundamental Rights.49 The principle applies to both physical and legal persons. It forbids both direct and indirect discrimination, i.e., discriminatory treatments based on nationality or on criteria typically met by nationals, such as the location of the registered seat, of first publication or where the performance took place. This principle has an absolute effect, which means that discrimination applies only when justified by objective reasons.50 In addition, this principle has a direct effect, i.e., it may be directly relied upon before a national court by an author or a performer from another Member State in order to claim the benefit of protection reserved to national authors and performers.51

47 48

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50 51

Drexl, ‘The Proposed Rome II Regulation’, note 14. The prohibition of any discrimination on the grounds of nationality requires that a person in a situation governed by the EC law is placed on a equal footing with nationals of the Member State concerned in this respect and hence precludes a Member State from making the grant of an exclusive right subject to the requirement that the person concerned is a national of that State. This principle could be established also thanks to precedents such as Case C-186/87, Cowan v Trésor Public [1989] ECR 195, para. 10. See in particular art. 21(2) of the Charter: ‘Within the scope of application of the Treaty establishing the European Community and of the Treaty on European Union, and without prejudice to the special provisions of those Treaties, any discrimination on grounds of nationality shall be prohibited.’ Walter and Riede, note 36, 39ff, state that a different and relative understanding of the principle would reduce its impact and legitimacy dramatically. Cases C-92/92 and C-326/92, note 4. See also pts 31 and 32 of the related opinion of AG Jacobs, available on the official website of the Court, www.curia.eu.

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2.22 The goals of the TFEU Treaty have to be examined to understand what is encompassed within the scope of the Treaty. Non-discrimination is crucial for achieving free competition on an equal footing and thus, for ensuring the free circulation of goods and services within the internal market. In other words, non-discrimination is fundamental for ensuring a real integration within the EU. On the one hand, copyrightable works, as well as performances and other subject matter can be perceived as goods and services. On the other hand, both primary and secondary EU legislation refers to IPRs. Article 36 of TFEU refers to industrial and commercial property rights as exceptions to free circulation of goods and services, provided that they do not constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States. In the light of the terminology of TFEU, this rule can be reasonably extended to copyright and related rights as well.52 In addition, several Directives deal with punctual or cross-cutting aspects of copyright and related rights. This means that copyright and related rights fall within the scope of the Treaty. Then, the principle of non-discrimination of Article 18 TFEU can reasonably apply to both copyright and neighbouring rights. This statement is also confirmed by several decisions issued by the CJEU since 1993 and mentioned hereinafter. 2.23 The principle certainly applies to EU citizens; it can be stated that it also reasonably applies to EEA citizens.53 Non-EU citizens who are not subject to EU rules are excluded from the scope of application of this principle, notwithstanding Article 4 of TRIPs on the MFN, because both the Treaty on EEC and EEA were notified under the terms indicated in the same Article 4. The notification covers both acts for regional integration purposes that have already been adopted and that shall be adopted by the EU or by the Member States.54 It would be logical to submit citizens from third countries to the principles when they happen to be in a situation ruled by EU law.55 However, it seems that the Court of Justice limited the application of this principle to artists and performers of other Member States only.56

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Walter and Riede, note 36, 42, fn 23. See also art. 167 TFEU supporting this interpretation. It has to be noted that in connection with art. 36 of the TFEU it is possible to refer to the principle of exhaustion as a measure to avoid price discrimination within the EU. D. Sarti, sub art. 36 TFEU, in L.C. Ubertazzi, Commentario breve alle leggi di proprietà intellettuale e concorrenza, 7th edn, CEDAM, Padoue, 2019, 9ff. Therefore exhaustion also plays a role, together with other standards, as to the non-discriminatory treatments in the copyright field. J.L. Gaster, ‘Suites de l’arrêt Phil Collins de la CJCE dans le domaine du droit d’auteur et des droits voisins’, RIDA 1996, 3ff, spec. 55. As to the EEA norms supporting this position, see art. 4 of the EEA Agreement which is identical in its form (and in its substance) to art. 18 TFEU. According to art. 6 of the same EEA Agreement, insofar as its provisions: are identical in substance to corresponding rules of the Treaty establishing the European Economic Community and the Treaty establishing the European Coal and Steel Community and to acts adopted in application of these two Treaties, shall, in their implementation and application, be interpreted in conformity with the relevant rulings of the Court of Justice of the European Communities given prior to the date of signature of this Agreement.

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By way of this principle, the decisions of the CJEU ensure uniform interpretation in the EEA. However, the binding effect concerns only the case law in place prior to the date the EEA Agreement was signed in 1992; the binding effect of more recent EU jurisprudence depends on a decision rendered by the EEA Joint Committee and its implementation into national law. Thanks to the principle of homogeneity contained in the EEA Agreement, the EEA members aim at ensuring an interpretation of the EEA Agreement as consistent and equivalent as possible with the EU law. Thus, even if the Phil Collins decision of the CJEU does not have per se binding force, it can be argued that the substantial arguments outlined in such a case are valid in the EEA. Cf. Walter and Riede, note 36, 43 and 44. See WTO/IP/N/4/EEC/1 of 29 January 1996. On this issue see P. Cottier and T. Véron, Concise International and European IP Law, Kluwer International Law, London, 2011, 22. G. Bonet, ‘L’égalité du traitement des titulaires de droits d’auteur ou de droits voisins dans la Communauté’, in Mélanges Françon, Dalloz, Paris, 1995, 1ff. See also J.S. Bergé, La Protection internationale et communautaire du droit d’auteur, LGDJ, Paris, 1996. Cases C-92/92 and C-326/92, note 4.

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2. CJEU case law: some milestones The European rule on non-discrimination has been interpreted through the years in such a way by 2.24 the CJEU that it has overridden the long-standing provisions of national law of the EU Member States regarding the status of foreign right holders in the area of IPRs. For instance, cases of discrimination, such as reciprocity rules imposed by Berne Convention, may no longer be applied to the extent this would represent a discrimination under the current Article 18 TFEU. In other words, Article 18 TFEU is considered by the CJEU as a tool for realizing an ever-growing integration within the EU. The principle embedded in this norm was referred to in at least three very well-known cases, that served as milestones in the interpretation of National Treatment in copyright and neighbouring rights law. Until 1993 the CJEU preferred to solve decisions on discriminatory treatments in the field of 2.25 copyright or related rights on the basis of norms on abuse of dominant position, such as the current Article 102 TFEU (previously art. 82 TEC and art. 86 TEEC).57 In 1993, the CJEU responded to a possible discrimination of a British performer (Phil Collins) under German law on the status of foreign performers, on the basis of Article 7 of the EEC Treaty (now art. 18 TFEU). Phil Collins claimed protection against the unauthorized distribution of compact discs on German territory of a recording in the US. At that time, German norms were granting different protection to foreign performers compared to national ones. Thus, Phil Collins could not be protected because of his nationality. The less famous but joint cases EMI Electrola were related to the marketing in Germany of phonograms of recordings of shows given in 1958 and 1959 in Great Britain by the British singer Cliff Richard. In these joint cases, the Court of Justice had to say whether the protection of performing artists by related rights was covered by the EEC Treaty. It answered positively and pointed at the importance of related rights for the free movements of goods and services as well as for competition within the EEC.58 The Court stated that the discrimination on the basis of nationality of Collins (and of Richard) was not justified on the grounds of differences of national rules of Member States governing the matter, nor on the ground that not all Member States had yet adhered to the Rome Convention.59 Eventually the Court decided that the first paragraph of Article 7 of the EEC Treaty must be interpreted as precluding the legislation of a Member State from denying to authors and performers from other Member States the protection accorded by that legislation to the nationals of the State. Thus, the principle of non-discrimination clearly applies, among others, to copyright and related rights. The decision also made clear that the principle of non-discrimination has a retroactive effect and therefore applied even to facts, which took place at a time when a Member State was not yet a Member of the EU.60 In 2002, the CJEU was again called on to comment on the principle of National Treatment in 2.26 the field of copyright and related rights.61 The procedure started because some performances of the opera La Bohème were held in Germany without the authorization of the right holders. The

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See for instance C-7/82, GVL v Commission, in RIDA 1/1984, 220ff. According to A. Lucas, H.J. Lucas and A. Lucas-Schloetter, Traité de la propriété littéraire et artistique, 4 ed., 2012, 1345ff. The reason seems to be that there was no specific rule on non-discrimination and the principle does not apply autonomously. Since the Phil Collins case came down, the German Federal Court of Justice has noted that ‘for decades, nobody ever thought that it was possible to rely on’ this principle, requiring full National Treatment for EC authors. See BGH (Federal Court of Justice), April 21, 1994, The Rolling Stones decision, in RIDA 1995, 240ff. However, it has to be noticed that the related previous decision of the European Commission of 29 October 1981, in OJEC n. L 370/49, was partially grounded on art. 7 of the Treaty. Cases C-92/92 and C-326/92, note 4, points 22–28 explain the effect of intellectual property rights on the internal market. Ibid., point 31. The joint case of EMI Electrola dealt with an artist whose performance took place before the UK joined the EU in 1973. Case C-360/00 Land Hessen and G. Ricordi & Co v Bühnen-und Musikverlag GmbH, Propriété Intellectuelles 2002, 62ff.

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defendant argued that before the implementation of the Directive 1993/98/EEC62 on the term of protection the German Copyright Act distinguished between the protection of German authors and foreign authors; these latter could benefit from the protection only for works first published in German territory or appearing in Germany 30 days from their publication elsewhere. La Bohème was first published in Italy, where according to the national Copyright Act at that time, the work had been in the public domain since 1980,63 whereas under German law, which at that time granted life plus 70 years of protection, it only ran out at the end of 1994. Germany had never made a reservation not to apply the comparison of terms rule, so a German opera house claimed that La Bohème was copyright-free in Germany in the seasons of 1993/94 and 1994/95. The Frankfurt Court of Appeal approved the first instance decision that did not apply Article 7.8 of the Berne Convention on comparison of terms and referred to German Law.64 The CJEU stated that German provisions enabled a direct discrimination based on the nationality of performers and that the EU principle of National Treatment opposes retroactively65 that the term of protection granted by a State for works of an author coming from another State is shorter than the protection for works of its own authors.66 In this way, the Court of Justice took the chance to paralyse the application of Article 7(8) of the Berne Convention within the EU and so its decision is complementary to Article 7 of the Directive 1993/98/EEC (now Directive 2006/116/EC). 2.27 In 2005, the Court of Justice issued another important decision on the principle of National Treatment and the clause of reciprocity as in Article 2(7) of the Berne Convention, which leads to a distinction based on the criterion of the country of origin of the work.67 The plaintiff was asking for copyright protection on designs (of shoes), while in the country of origin (Italy) no copyright protection existed on applied arts. Again, the CJEU stated that discrimination by reason of nationality is prohibited as well as any forms of it leading to the same result,68 unless the discrimen is justified by objective circumstances.69 In particular, the effect of such application was that no advantageous treatment, namely the enjoyment of twofold protection based on the laws on designs 62

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Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights, available at https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX%3A31993L0098, now codified into Directive 2006/116/EC, available at https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX%3A32006L0116. The Italian composer Puccini died in 1924 and enjoyed 56 years of protection post mortem auctoris (pma) under Italian law. Consequently, in Italy the copyright in his opera La Bohème ran out in 1980. F. Pollaud-Dulian, ‘Du bon usage du principe communautaire de non-discrimination en droit de propriété intellectuelle: à propos de l’affaire La Bohème’, in Propriétés Intellectuelles 2003, 24ff, indicated that the German copyright norms at that time were not in compliance with the principle of non-discrimination. Diversely G. Dworkin and J.A.L. Sterling, ‘Phil Collins and the Term Directive’, EIPR 1994, 187ff.; G. Karnell, ‘Traitement national, copie privé sonore ou audiovisuelle et interprétation de la Convention de Berne pour la protection des oeuvres littéraires et artistiques’, in Mélanges Françon, Dalloz, Paris, 1995, 267ff.; Bergé, note 55, n. 538, advanced that there is a tension between the reciprocity clause of art. 7(8) of the Berne Convention and the principle of non-discrimination. However, it seems that as an exception provided by the Berne Convention, the comparison of terms should be in line with both arts 3(1) and 4 of the TRIPs Agreement. Cases C-92/92 and C-326/92; C-360/00, 25 and 26. This has huge implications as to transitory norms. Case C-360/00, point 33: since Art. 7.8 of the Berne Convention permits the Federal Republic of Germany to extend to the rights of a foreign author the 70-year term of protection prescribed by German law, the mechanism of comparison of the terms of protection provided for in that provision cannot justify the difference of treatment as regards the term of protection […] between the rights of a German author and those of an author who is a national of another Member State.

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Case C-28/04, Tod’s SpA v Heyraud SA, in Propriétés Intellectuelles 2005, 442ff. For a critical approach to this solution, H.J. Lucas, ‘Comment to Cass. Com., 26 March 2002’, in JCP Entreprise 2003, 1508, n. 10, according to whom this position would eliminate any chance to apply the law of the country of origin within the EU area. Ibid., para. 19, where the CJ refers, inter alia, to Case C-29/95, Pastoors and Trans-Cap, para. 16 and Case C-224/00 Commission v Italy, para. 15. These decisions are available on the official website of the CJ www.curia.eu. C-28/04, paras 35 and 29 referring to C-398/92, Mund and Fester, paras 16 and 17, and again to Case C-29/95, Pastoors and Trans-Cap, para. 19. In these terms, it is hard to justify norms on reciprocity, when their aim is to discriminate against foreign authors. See for instance art. L 111-4 of the French Code of Intellectual Property, saying that the French copyright law does not protect works first published in a country that does not guarantee enough protection to works first published in France. On this provision, see T. Azzi, ‘Réciprocité et protection internationale du droit d'auteur: plaidoyer

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and on copyright, should have been granted to the author of a work the country of origin of which is another Member State, which affords that work only protection under the law relating to designs.70 In principle, this should mean that Member States cannot protect authors and artists upon the condition of domicile in their territory.71 With this decision, grounded on Article 12 TEC (now art. 18 TFEU), the Court of Justice blocked the application of Article 2(7) of the Berne Convention in the EU territory and such a decision is complementary to the Directive 98/71/EC on the protection of registered designs.72

3. Exceptions to the National Treatment principle In a lack of cases or EU norms, the principles embedded in international law apply.73 This works for 2.28 exceptions to the principle of National Treatment, too. Some scenarios then are governed by reciprocity clauses introduced in the Berne Convention for instance. More precisely, it is possible to refer to the resale right,74 the countermeasures against back-doors protection, the application in time of rights and the reservation of the ten-year period regarding translations.75 Another exception deserves some attention and this is the one related to the sui generis right on 2.29 databases. Article 11 of Directive 96/9/EC limits the sui generis protection to nationals or residents of EU Member States, or to companies and firms having their registered office, central administration or principal place of business within the EU.76 This approach is different from the National Treatment one. The justification is to be found in the fact that the sui generis right is an EU law peculiarity and it is not covered by any international legal instrument. As a matter of fact, the sui generis right falls outside the scope of the Berne Convention, which is limited to the protection of ‘literary and artistic works’,77 and of the TRIPS Agreement, that encompasses only IPRs specifically enumerated in its substantive sections.78

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pour l'abrogation de l'article L. 111-4 CPI’, in Liber Amicorum Georges Bonet, IRPI, Litec, Paris, 2010, 9ff. See also mutatis mutandis a decision of the French Conseil Constitutionnel, 27 July 2006, Recital 13, JO 3 August 2006, 11541ff. Case C-28/04, Tod’s SpA v Heyraud SA, points 19 and 20. However, this principle should not be interpreted as a limitation of a better protection for EU citizens than for local. See on this the Dutch Hoge Raad decision, Cassina v Sedeti, 26 May 2000, in EIPR 2001. See also N. Mout-Bouwman, ‘Phil Collins Revisited’, in EIPR 2001, 100ff. Gaster, 75ff. For further examples: Lucas, Lucas and Lucas-Schloetter, note 57, 1353, fn 22. Directive 98/71/EC on the legal protection of design, available at https://eur-lex.europa.eu/legal-content/EN/ALL/ ?uri=CELEX%3A31998L0071, imposes the double protection of industrial property and copyright on designs in the EU. Before this Directive was introduced and entered into force, some countries (like Italy) were very reluctant in granting copyright protection to design. Unless one argues in favour of the application of case law and specific norms because of the principle of interpretation by analogy, which does not entirely convince. As to the resale right, it is important to consider the Directive 2001/84/EC. In particular its art. 7(1) seems to suggest a reciprocity rule, in line with Recital 6 and art. 14ter of the Berne Convention. Lucas, Lucas and Lucas-Schloetter, note 57, 1353ff, suggest giving particular attention to the right of public rental as well. Directive 96/9/EC on the legal protection of Databases, available at https://eur-lex.europa.eu/LexUriServ/LexUriServ. do?uri=CELEX:31996L0009:EN:HTML. J.L. Gaster, ‘The New EU Directive concerning the Legal Protection of Databases’, Fordham Intl. L.J. 1997, 1129ff. Contra: see S. Frankel, ‘Challenging Trips-Plus Agreements: The Potential Utility of Non-Violation Disputes’, J. Intl. Econ. L. 2009, 1023ff., arguing that the EU database right ought to be subject to National Treatment under TRIPS because protecting data from unfair extraction amounts to a greater level of database protection than TRIPS requires. An additional argument justifying the application of National Treatment to the sui generis right protection could be grounded in the nature of such a right. Should it be considered as a related right, immediate consequences would apply to the protection of foreign database producers in the EU. See references in B. Hugenholtz, ‘Something Completely Different: Europe’s Sui Generis Database Right’, in S. Frankel and D. Gervais (eds), The Internet and the Emerging Importance of New Forms of Intellectual Property, Wolters Kluwer, Alphen aan den Rijn, 2016, 9.1ff.

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IV. CONCLUSION 2.30 With a lack of a global uniform copyright law, non-discriminating practices are crucial for ensuring a more consistent legal framework, which can facilitate trade and market development. Nondiscrimination is embedded into copyright via some standards, such as the National Treatments and the MFN clause, but also the principle of exhaustion for instance. National Treatment seems to be the principle playing the biggest role in limiting unjustified discriminatory practices. It ensures a more suitable protection to authors and artists than formal and material reciprocity.79 In other words, it could be stated that the principle of National Treatment plays a symbolic role in the specific legal area of copyright. i.e., it is the carrier of the spirit of internationalism, notwithstanding the challenges imposed by cultural and economic protectionism.80 With the purpose of favouring the regional integration, Article 18 of TFEU is aimed at forbidding both direct and indirect discrimination.81 This norm was interpreted in a way to have a strong impact on the application of the National Treatment principle in the copyright field, at least if compared to the operation of the same principle in the international legal instruments, such as the Berne Convention, TRIPs Agreement, Rome Convention and WPPT. 2.31 At the time the Phil Collins case was litigated, it was not clear whether the principle of non-discrimination also applied to copyright in the EU territory. This decision and the following ones enabled the CJEU to state clearly that this is the case. It follows from the case law of the CJEU on the application of the principle of National Treatment that some domestic provisions containing reciprocity clauses cannot be relied upon in order to deny nationals of other Member States rights conferred on national authors. The application of such clauses in the European Union runs counter to the prohibition of any discrimination on grounds of nationality. In addition, some of the reciprocity clauses introduced by the Berne Convention were also blocked by the EU case law. Some Directives on different copyright or IPRs aspects seem to complement the case law, thus implementing the current Article 18.2 TFEU. This indicates that the EU Institutions may adopt rules designed to prohibit such discrimination. However, so far, neither the CJEU nor the EU Institutions have overruled the entire list of reciprocity clauses of the international conventions on IPRs, such as those contained in the Berne Convention. As a consequence, some issues ruled by reciprocity according to the international law provisions have been caught by the EU legislator or by a judge and are now ruled by the National Treatment in the EU, while issues ruled by reciprocity according to the international law provisions, which have not been caught (so far) by the EU legislator or judge, remain an exception to the principle of National Treatment in the EU, unless an interpretation by analogy applies.82

NOTES 1. Relevant instruments Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) 1994. The Treaty on the Functioning of the European Union (TFEU) December 2009. The General Agreement on Tariffs and Trade (GATT). Berne Convention for the Protection of Literary and Artistic Works, September 9, 1886.

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Ricketson and Ginsburg, note 21. According to Brauneis, note 38, ‘Although National Treatment continues to have substantial interstitial force, the greatest value of National Treatment in copyright and related rights may be, not the specific economic benefits it provides, but the spirit of internationalism it conveys, and the gentle nudge it provides to legislatures and judges away from petty protectionism.’ P. Garrone, ‘La discrimination indirecte en droit communautaire: vers une théorie générale’, RTDE 1994, 425ff. See note 73.

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IV. CONCLUSION International Convention for the Protection of Performers, Producers of Phonograms Broadcasting Organizations, Rome, October 26, 1961. Council Directive 93/98/EEC of 29 October 1993 harmonizing the term of protection of copyright and certain related rights, OJ L 290/9, 24.11.1993. Directive 2001/84/EC of the European Parliament and of the Council of 27 September 2001 on the resale right for the benefit of the author of an original work of art, OJ L 272/32, 13.10.2001.

2. CJEU case law Commission v Italy (C-224/00) [2002] ECR I-02965. Cowan v Trésor Public (C-186/87) [1989] ECR I-00195. GVL v Commission (C-7/82) [1983] ECR 00483. Land Hessen and G. Ricordi & Co v Bühnen-und Musikverlag GmbH (C-360/00) [2002] ECR I-05089. Mund and Fester (C-398/92) [1994] ECR I-00467. Pastoors and Trans-Cap (C-29/95) [1997] ECR I-00285. Phil Collins v Imtrat and Patricia v EMI Electrola (Joined Cases C-92/92 and C-326/92) [1993] ECR I-05145. Tod’s SpA v Heyraud SA (C-28/04) [2005] ECR I-05781.

3. Bibliography Azzi, T., ‘Réciprocité et protection internationale du droit d’auteur: plaidoyer pour l’abrogation de l'article L. 111-4 CPI’, in Liber Amicorum Georges Bonet, IRPI, Litec, Paris, 2010. Beier, F.-K. and G. Schricker (eds), GATT or WIPO? New Ways in the International Protection of Intellectual Property, IIC Studies. Studies in Industrial Property and Copyright Law, 1988, 99. Bénabou, V.-L., Droit d’auteur, droit voisins et droit communautaire, Bruylant, Brussels, 1997. Bergé, J.S., La Protection internationale et communautaire du droit d’auteur, LGDJ, Paris, 1996. Bonet, G., ‘L’égalité du traitement des titulaires de droits d’auteur ou de droits voisins dans la Communauté’, in Mélanges Françon, Dalloz, Paris, 1995. Brauneis, R., ‘National Treatment in Copyright and Related Rights: How Much Work Does It Do?’, 2013, GW Law Faculty Publications & Other Works, 810, https://scholarship.law.gwu.edu/faculty_publications/810. Correa, C., Trade Related Aspects of Intellectual Property Rights, Oxford University Press, Oxford, UK, 2007, 66. Cottier, P. and T. Véron, Concise International and European IP Law, Kluwer International Law, London, 2011. Dinwoodie, G.B., ‘Developing a Private International Intellectual Property Law: the Demise of Territoriality’, (2009) William & Mary L. Rev. 711. Drexl, J., ‘IP in Bilateral Trade Agreements. Some Ideas on How They Promote Market Power and Distort International Competition’, in G. Ghidini and L.M. Genovesi (eds), Intellectual Property and Market Power, Eudeba, Buenos Aires, 2008. Drexl, J., ‘The Proposed Rome II Regulation: European Choice of Law in the Field of Intellectual Property’, in J. Drexl and A. Kur (eds), Intellectual Property and Private International Law: Heading for the Future, Hart, London, 2005, 151. Dworkin, G. and J.A.L. Sterling, ‘Phil Collins and the Term Directive’, (1994) EIPR 187. Evans, G., ‘TRIPs and the Sufficiency of Free Trade Principles’, (1999) JWIP 707. Frankel, F., ‘Challenging Trips-Plus Agreements: The Potential Utility of Non-Violation Disputes’, (2009) J. Intl. Econ. L. 1023. Garrone, P., ‘La discrimination indirecte en droit communautaire : vers une théorie générale’, (1994) RTDE, 30 (July–Sept.), 425. Gaster, J.L., ‘The New EU Directive concerning the Legal Protection of Databases’, (1997) Fordham Intl. L.J. 1129. Gaster, J.L., ‘Suites de l’arrêt Phil Collins de la CJCE dans le domaine du droit d’auteur et des droits voisins’, (1996) RIDA, 2, 3–91. Gervais, D., The TRIPs Agreement. Drafting History and Analysis, Sweet & Maxwell, London, 1998. Ginsburg, J., ‘A Tale of Two Copyrights: Literary Property in Revolutionary French and America’, in B. Sherman and A. Strowel (eds), Of Authors and Origins. Essays on Copyright Law, Oxford University Press, Oxford, 1994. Hugenholtz, B., ‘Something Completely Different: Europe’s Sui Generis Database Right’, in S. Frankel and D. Gervais (eds), The Internet and the Emerging Importance of New Forms of Intellectual Property, Wolters Kluwer, Alphen aan den Rijn, 2016, 9.1. Karnell, G., ‘Traitement national, copie privé sonore ou audiovisuelle et interprétation de la Convention de Berne pour la protection des oeuvres littéraires et artistiques’, in Mélanges Françon, Dalloz, Paris, 1995.

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Chapter 2 THE PRINCIPLE OF NON-DISCRIMINATION Koumantos, G., ‘Sur le droit international privé du droit d’auteur’, (1979) IDA 616. Loehwenheim, U., ‘The Principle of National Treatment in the International Conventions on Intellectual Property’, in W.P. Pyrmont, M.J. Adelman, R. Brauneis, J. Drexl and R. Nack (eds) Patents and Technological Progress in a Globalized World, MPI Studies on Intellectual Property, Competition and Tax Law, Springer, Berlin, Heidelberg, 2009, 593ff. Lucas, A., ‘Droit international privé et droit d’auteur’, in Les cahiers de propriété intellectuelle, October, 2010. Lucas, A., H.J. Lucas and A. Lucas-Schloetter, Traité de la propriété littéraire et artistique, 4 ed., LexisNexis, Litec, Paris, 2012. Lucas, H.J., ‘Comment to Cass. Com., 26 March 2002’, in JCP Entreprise, 2003. Mout-Bouwman, N., ‘Phil Collins Revisited’, (2001) EIPR, 100. Ortino, F., ‘The Principle of Non-Discrimination and its Exceptions in GATS: Selected Legal Issues’, presented at Conflict and Crises? – The WTO after Hong Kong, Vienna, 24–25 April 2006. Peukert, A., ‘Territoriality and Extraterritoriality in Intellectual Property Law’, in G. Handl and J. Zekoll (eds), Beyond Territoriality: Transnational Legal Authority in An Age of Globalization, Martinus Nijhoff, Leiden, 2011, 194. Pollaud-Dulian, F., ‘Du bon usage du principe communautaire de non-discrimination en droit de propriété intellectuelle: à propos de l’affaire La Bohème’, (2003) Propriétés Intellectuelles. Ricketson, S., The Berne Convention for the Protection of Literary and Artistic Works: 1886–1986, Oxford University Press, Oxford, 1987. Ricketson, S. and J. Ginsburg, International Copyright and Neighbouring Rights. The Berne Convention and Beyond, 2nd ed., Oxford University Press, Oxford, 2006. Sarti, D., ‘Sub art. 36 TFEU’, in L.C. Ubertazzi, Commentario breve alle leggi di proprietà intellettuale e concorrenza, 7th edn, CEDAM, Padoue, 2019, 9. Strowel, A., Droit d’Auteur and Copyright. Divergences and Convergences, Bruylant, Brussels, 1993. Torremans, P., ‘Copyright Territoriality in a Borderless Online Environment’, in J. Axhamn (ed.), Copyright in a Borderless Environment, Norstedts Juridik. Stockholm, 2012, 23. Ubertazzi, L.C., ‘La territorialità dei diritti del produttore fonografico, dell’artista e dell’ IMAIE, (1992) AIDA 91. Van Bunnen, L., ‘L’interdiction CEE de toute discrimination en fonction de la nationalité dans le droi d’auteur s’oppose-t-elle à une certaine reciprocité?’, in Liber Amicorum Aimé de Caluwé, Bruylant, Brussels, 1995. von Lewinski, S., Intellectual Property, Nationality and Non-Discrimination, available at http://www.wipo.int/export/ sites/www/tk/en/hr/paneldiscussion/papers/pdf/lewinski.pdf. Walter, M.M. and L. Riede, ‘Principle of Non-discrimination under the EC Treaty’, in M.M. Walter and S. Von Lewinski (eds), European Copyright Law. A Commentary, Part I, Oxford University Press, Oxford, 2010.

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3 THE PRINCIPLE OF FREE MOVEMENT OF GOODS: COMMUNITY EXHAUSTION AND PARALLEL IMPORTS Benedetta Ubertazzi I.

INTRODUCTION

III. INTERNATIONAL EXHAUSTION

3.01

II. CONSENT OF THE IPR OWNER AND PLACEMENT ON THE MARKET

3.15

3.06

I. INTRODUCTION Intellectual property rights (hereinafter: IPRs) attribute to their owners, inter alia, the exclusive 3.01 right to control the number of exemplars incorporating the IPR protected works that are placed on a market, i.e., to control their distribution. Under a principle common to continental and common law countries, the IPR owner loses his right to control the resale of said exemplars once they are placed on the relevant market either by himself or with his consent.1 This principle is called the ‘exhaustion of intellectual property rights’ and is ‘nothing more than a figurative expression to describe the idea that once genuine goods have been marketed [by the IPR owner or with his consent] subsequent distribution should not be impeded by [IPR] action’.2 The exhaustion of IPRs can be of a national, regional or international/global nature.3 When country 3.02 A follows a national exhaustion regime the IPR owner does not lose his/her (hereinafter: his) right to resell and to oppose the importation of the IPR-protected products in country A, even if these products were already sold by him/her (hereinafter: him) or with his consent in country B. A national exhaustion system is followed for instance in the United States of America (USA).4 In contrast, when country A follows an international exhaustion system, the sale of IPR protected goods by or with the IPR owner’s consent in any part of the world results in the exhaustion of his 1

2

3 4

In the US the principle of exhaustion is described as the first sale doctrine, whereas national UK law follows an approach of implied license. For a detailed comparative perspective highlighting similarities and differences and related historical origins, see A. Lucas, ‘International exhaustion’, in L. Bently, U. Suthersanen and P.L.C. Torremans (eds), Global Copyright, Three Hundred Years since the Statute of Anne, from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, 2010, 306; T. Cook, ‘Exhaustion – A casualty of the borderless digital era’, in L. Bently, U. Suthersanen and P.L.C. Torremans (eds), above, 354 ff.; T. Cook, EU Intellectual Property Law, Oxford University Press (OUP), Oxford, 2010, 17; E. Bonadio, ‘Parallel imports in a global market: should a generalised international exhaustion be the next step?’ (2011) European Intellectual Property Review, 33(3), 153–61; C. Stothers, ‘When is copyright exhausted by a software license UsedSoft v Oracle ’, (2012) European Intellectual Property Review, 11, 791; A.B. Pope, ‘A second look at first sale: An international look at U.S. copyright exhaustion’, (2011–2012) Journal Int Prop Law, 19, 201. See J. Schovsbo, ‘Free movement of goods and exhaustion’, in A. Ohly (ed.), Common Principles of European Intellectual Property Law, Mohr Siebeck, Tübingen, 2012, 171 quoting Beier, ‘Territoriality of Trademark Law and National Trade’ (1970) International Review of Industrial Property and Copyright Law, 1(1), 57. Lucas, 304; Schovsbo, 173. See P. Mezei, ‘Digital Exhaustion in the European Union and the US’ in P. Mezei (ed.), Copyright Exhaustion Law and Policy in the United States and the European Union, Cambridge University Press, Cambridge, 2018.

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right to control any reselling of the same goods in country A.5 An international exhaustion system is followed for example in both New Zealand and Australia.6 An ‘intermediate solution’7 is regional exhaustion, which is adopted by countries party to a free trade or custom union agreement and means that the sale of an IPR-protected product in one of these countries exhausts the right to resell in the others. A regional exhaustion system is followed for example in the European Union (EU). 3.03 In the various national systems, the principle of exhaustion of IPRs is typically justified by three sets of arguments.8 First, it ‘allows reconciliation of author’s copyright and buyer’s property rights of the movable property consisting of the copy’.9 Second, exhaustion makes ‘the circulation of copies “flow” by privileging freedom of trade’,10 with the result of increasing the availability of cultural assets. Third, it allows remuneration for the first sale, which is considered to be a sufficient ‘fair profit’ for the copyright holder.11 3.04 In the EU, the principle of exhaustion is also justified by a fourth argument, namely by the aim of precluding IPRs from being used to partition the EU territory into different areas corresponding to Member States’ national markets.12 Such a partition would occur if, after the placement of the exemplars incorporating the IPR protected works on the market of an EU Member State by or with the consent of the IPR owner, the owner then had to consent to their placement on any other EU Member State market. This result would be contrary to the EU aim of abolishing the restriction to trade of goods and cultural products among the EU Member States, which is established by Article 34 TFEU (ex Art. 28 TEC), according to which ‘quantitative restrictions on imports and all measures having equivalent effects shall be prohibited between Member States’. Article 36 TFEU (ex Art. 30 TEC) provides for an exception to Article 34 TFEU, allowing for the restriction of the trade of goods between Member States when justified on grounds of the protection of IPRs.13 However, early case law (discussed below) shows the ECJ (now CJEU: hereinafter: CJEU) interpreted this exception narrowly, confining the ‘specific subject matter’ of an IPR to the right to be the first to place the product on the market.14 Therefore, the CJEU established that once goods subject to IPRs have been placed on the market of one country within the EU by or with the consent of the owner of the rights in that country, the right holder cannot prevent the subsequent export/import and resale of such goods in other parts of the EU under parallel intellectual property rights (parallel imports). As such, the CJEU established the principles of Community exhaustion of rights and parallel imports, which will be referred to hereinafter as ‘the principle of Community exhaustion of rights’ for reasons of simplicity.

5 6 7 8

9 10 11 12 13

Provided that the IPR at stake exists and is valid in both countries, i.e., the one where the protected goods have been sold and country A as above. See Bonadio, 154. See Bonadio, 158 and further references there. Bonadio, 154. Lucas, 306; see also A. Wiebe, ‘The principle of exhaustion in European Copyright Law and the distinction between digital goods and digital service’, (2009) GRUR International, 58(2), 114. With particular regard to the Italian system, see Sarti, Diritti esclusivi e circolazione dei beni, Giuffrè, Milano, 1996. Lucas, 306. Ibid. Ibid. Cook, EU Intellectual Property Law, 18. Namely by stating that: the provisions of Arts 34 and 35 shall not preclude prohibitions or restrictions on imports, exports or goods in transit justified on grounds of public morality, public policy or public security; the protection of health and life of humans, animals and plants; the protection of national treasures possessing artistic, historical or archaeological value; or the protection of industrial and commercial property. Such prohibitions or restrictions shall not, however, constitute a means of arbitrary discrimination or a disguised restriction on trade between Member States.

14

These CJEU decisions are described as being the first negative harmonisation phase related to the principle of Community exhaustion. See Schovsbo, 170.

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The principle of Community exhaustion of rights was then codified by a number of harmonising 3.05 Directives and in relation to their relevant rules was, and is still being, developed further by the CJEU;15 extends throughout the European Economic Area (EEA), since similar provisions to Articles 34 and 36 TFEU are to be found in Articles 11 and 13 of the EEA Agreement; concerns the way in which IPRs are exercised without, however, prejudicing their actual existence consistently with Article 345 TFEU (ex Art. 295 TEC);16 has horizontal effect; applies to all fields of IPRs, even though in subtly different ways;17 and will be examined in the following pages with regard to copyright.

II. CONSENT OF THE IPR OWNER AND PLACEMENT ON THE MARKET The principle of Community exhaustion of rights applies only when goods subject to IPRs have 3.06 been placed on the relevant market by the owner of the rights in that country, or with his consent. The CJEU clarified with various decisions that the holder of an IPR ‘acquired under the legislation of a Member State may oppose the importation of [infringing products from another Member State], provided that the products in question have not been put into circulation in the other Member State by, or with the consent of, the proprietor of the right’.18 The IPR owner’s consent to the placement on the market of IPR protected products is necessary to prevent the application of the principle of Community exhaustion to allow importation of products which is otherwise impeded on the basis of differences between Member States’ national IP legislation.19 In addition, the CJEU clarified20 that in determining whether actions undertaken by parties to an agreement regarding the placement of goods protected by IPRs on the market are based on the ‘consent’ of the IPR owner, EU harmonised rules should be applied, rather than national rules or principles developed in contract law, which ‘would be irrelevant as such’.21 Thus, every act of putting an article into circulation by the IPR owner or with his consent results in exhaustion, even when in the country of first circulation no rights exist or where the owner cannot be rewarded. In other words, ‘territorial restrictions in licensing contracts cannot affect the occurrence of exhaustion as a matter of the proprietary scope of the IP right’.22 The principle of Community exhaustion of rights applies when goods subject to IPRs are placed on 3.07 the market of one country within the EU or the EEA. The notion of ‘placing on the market’ was interpreted by the CJEU in the 1960s and 1970s as including the right of distribution in the context of sound recordings by the fundamental decisions in Consten and Grunding23 and Deutsche Grammophon,24 which established the current framework in relation to physical goods.25 According

15 16

17 18 19 20 21

22 23 24 25

The adoption of these Directives is described as the second positive harmonisation phase related to the principle of Community exhaustion. See Schovsbo, 170. According to which ‘the Treaties shall in no way prejudice the rules in Member States governing the system of property ownership’. See Schovsbo, 175–7; G. Westkamp, ‘Emerging escape clauses? Online exhaustion, consent and European copyright law’, in J. Rosén, Intellectual Property at the Crossroads of Trade, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2012, 42 ff. Cook, EU Intellectual Property Law, 2010, 18–19. Ibid., 22, quoting relevant CJEU case law. See also A. Kur and T. Dreier, European Intellectual Property Law, Text, Cases and Materials, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2013, 244. Cook, EU Intellectual Property Law, 2010, 22; Kur and Dreier, 244. See also Cook, ‘Exhaustion’, fn 43. Although the CJEU case law concerns trademarks, its conclusions apply to copyright also. See Schovsbo, 186–7. Ibid. See also P.L.C. Torremans and I. Stamatoudi, ‘International exhaustion in the European Union in the light of “Zino Davidoff”: Contract, versus trade mark law?’ (2000) International Review of Industrial Property and Copyright Law, 31(3), 131. Westkamp, 45. Joined Cases 56 and 58/64 Établissements Consten S.à.R.L. and Grundig-Verkaufs-GmbH v Commission of the European Economic Community [1966] ECR 429. Cases 78/70 Deutsche Grammophon Gesellschaft mbH v Metro-SB-Großmärkte GmbH & Co KG [1971] ECR 487. P.L.C. Torremans, ‘Introduction to Part III’, in Bently, Suthersanen and Torremans, 299; Schovsbo, 175.

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to these decisions it would conflict with the principle of free movement of goods for a rights owner to use his exclusive distribution rights to prevent the marketing in one Community Member State of goods sold by him or with his consent in another Community Member State.26 Placing on the market does not include (and therefore exhaustion does not apply to) mere importation without sale.27 In fact, the CJEU stated that goods: cannot be regarded as having been put on the market in the European Economic Area where the [IPR owner] […] has imported them into the European Economic Area with a view to selling them there or where he has offered them for sale to consumers in the European Economic Area, in his own shops or those of an associated company, without actually selling them.28

3.08 Placing on the market does not include restricted acts other than the distribution of physical goods which incorporate the subject of IPRs. So, it does not include activities that can be indefinitely repeated and can result in an infinite number of users of the protected work. Among these activities are ‘performance, broadcasting or cable diffusion, and today, on-line dissemination over the internet’,29 as well as offering third parties the possibility to merely use copyright protected items without a transfer of de facto power over such items.30 These activities are understood by EU law and jurisprudence as consisting in the making available to the public of IPR protected works and therefore in ‘performance of services’31 rather than sale of goods and, as a consequence, the principle of Community exhaustion of rights does not apply to the activities in question. 3.09 This distinction in the copyright exhaustion context between the restricted act of distribution in relation to physical articles and other restricted acts that can be indefinitely repeated, was first emphasised by the CJEU in the Coditel judgment,32 according to which the principle of Community exhaustion of rights does not apply where films are made available to the public by performances capable of being repeated without limits.33 The Coditel judgment was then confirmed

26

27 28 29

30 31

32

33

These decisions were then followed by other important judgments, such as Joined Cases 55/80 and 57/80 Musik-Vertrieb Membran GmbH and K-tel International v GEMA [1981] ECR 147 and Case 58/80 Dansk Supermarked v Imerco [1981] ECR 181. See Cook, EU Intellectual Property Law, 2010, 25–6. Cook, EU Intellectual Property Law, 2010, 20. Case C-16/03 Peak Holding AB v Axolin-Elinor AB [2004] ECR I-11313. See also Cook, EU Intellectual Property Law, 2010, 20–21. Cook, ‘Exhaustion’, 356; Torremans, 300; Schovsbo, 179. However, certain CJEU judgments in the 1990s considered the rights of ‘reproduction and adaptation as an adjunct to distribution’ (Cook, EU Intellectual Property Law, 2010, 26). See Case C-337/95 Parfums Christian Dior SA v Evora BV [1997] ECR I-6013, which ‘allowed for some reproduction even of marks protected by copyright for advertising purposes’, as such Schovsbo, 179. On Parfums Christian Dior see also I. Stamatoudi, ‘From drugs to spirits and from boxes to publicity (decided and undecided issues in relation to trade marks and copyright exhaustions)’ (1999) Intellectual Property Quarterly, 103; Westkamp, 38 ff. See also Case E-I/98 The Norwegian Government, represented by the Royal Ministry of Social Affairs and Health v Astra Norge AS [1998] EFTA 140, on which Cook, EU Intellectual Property Law, 2010, 26–7. Case C-456/06 Peek & Cloppenburg v Cassina [2008] ECR I-2731. See M. Leistner, ‘Copyright law in the EC: Status quo, recent case law and policy perspectives’, (2009) CMLR, 46, 860 ff. See Westkamp, 42 ff. Such a conclusion is in line with the broad notion of services followed at the EU level. Yet, in relation to the notion of services proper of the Brussels I Regulation to establish international jurisdiction, see the Falco judgment in which the Court ‘distanced itself from extensive acceptance’. Torremans, note 1, 314, note 30. See Case C-533/07 Falco Privatstiftung and Thomas Rabitsch v Gisela Weller-Lindhorst [2009] ECR I-03327. See P. de Miguel Asensio ‘Comment to Falco’ (2009) Rev. española Der. Int.; B. Ubertazzi, ‘Licence agreements relating to IP rights and the EC Regulation on jurisdiction’ (2009) International Review of Industrial Property and Copyright Law, 40, 912–39 and T. Dreier, ‘Online and Its Effects on the “Goods versus Services” Distinction’ (2018) IIC, 44(2) 137. Case 62/79 SA Compagnie générale pour la diffusion de la télévision, Coditel, and Others v Ciné Vog Films and Others [1980] ECR 00881. See Cook, ‘Exhaustion’, 356, recalling Bernt Hugenholtz’s understanding, according to which in Coditel ‘the Court expressly considered that the partitioning of markets along national borderlines in this specific case was legitimate because television broadcasting in the Member States was (then) traditionally organised on the basis of national monopolies’ and that ‘to infer from the Coditel decision a general rule of non-exhaustion of performance or communication rights would therefore be unwarranted’. Wiebe, 114.

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by the CJEU decisions in Warner Brothers v Christiansen34 and Ministère Public v Tournier.35 The same Coditel judgment was subsequently confirmed by Article 4(c) of Council Directive 91/250/ EEC of 14 May 1991 on the legal protection of computer programs;36 by Article 1(4) of Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property;37 by Article 1 of the subsequent Directive 2006/115 on the same subject-matter;38 and by Article 4(2) of the Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs.39 The Coditel judgment was recently confirmed in the area of encrypted broadcasting by the CJEU 3.10 decision in Football Association Premier League Ltd. and Others v QC Leisure and Others (C-403/08) of 4 October 2011.40 This judgment concerned the use of Greek decoder cards to show satellite broadcasts of English football matches in English pubs between 2004 and 2007 and decided that the freedom of movement of services under Article 56 TFEU ‘precludes legislation of a Member State which makes it unlawful to import into and sell and use in that State foreign decoding devices which give access to an encrypted satellite broadcasting service from another Member State that includes subject-matter protected by the legislation of that first State’.41 Although this judgment might be read as favouring an EU exhaustion of the right to public communication of copyrighted works, it confined its application to satellite broadcasts of English football matches, which are not covered by copyright.42 The judgment also puts emphasis on the fact that the IPR owner, because of a contractual relationship with the broadcaster and the possession of decoding devices, would have been in a position to determine the number of effective users of the protected works and to negotiate ex ante the payment of appropriate remuneration.43

34 35 36

Case 158/86 Warner Brothers Inc. and Metronome Video ApS v Erik Viuff Christiansen [1988] ECR 02605. Case 395/87 Ministère public v Jean-Louis Tournier [1989] ECR 02521. According to which: Subject to the provisions of Articles 5 and 6, the exclusive rights of the right holder within the meaning of Article 2, shall include the right to do or to authorize: […] (c) any form of distribution to the public, including the rental, of the original computer program or of copies thereof. The first sale in the Community of a copy of a program by the right holder or with his consent shall exhaust the distribution right within the Community of that copy, with the exception of the right to control further rental of the program or a copy thereof.

37

See the Directive in OJ L 122/1991, 17.5.1991, 42. According to which: in accordance with the provisions of this Chapter, Member States shall provide, subject to Article 5, a right to authorize or prohibit the rental and lending of originals and copies of copyright works, and other subject matter as set out in Article 2(1). […] The rights referred to in paragraph 1 shall not be exhausted by any sale or other act of distribution of originals and copies of copyright works and other subject matter as set out in Article 2(1).

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39

See the Directive in L 346/61, 27.11.1992. According to which: the ‘right to authorise or prohibit the rental and lending of original and copies of copyright works […] shall not be exhausted by any sale or other act of distribution of originals and copies of copyright works’. See the Directive of the European Parliament and of the Council of 12 December 2006 ‘on rental right and lending right and on certain right related to copyright in the field of intellectual property’, in OJ L, 376/28, 27.12.2006. According to which: the first sale in the [European Union] of a copy of a program by the right holder or with his consent shall exhaust the distribution right within the [European Union] of that copy, with the exception of the right to control further rental of the program or a copy thereof.

40 41 42 43

See the Directive in OJ L, 111/16, 05.05.2009. Joined Cases C-403/08 and C-429/08 Football Association Premier League Ltd. and Others v QC Leisure and Others and Karen Murphy v Media Protection Services Ltd. [2011] ECR I-09083. See conclusions. See M. Bertani, Diritto d’autore europeo, Giappichelli, Torino, 2012, 240 footnote 445. CJEU, para. 107 ff. See para. 113, according to which:

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3.11 The distinction in the copyright exhaustion context between the restricted act of distribution in relation to physical articles and other restricted acts, was further developed by harmonising Directives regarding the online distribution of copyright works in non-material form. These Directives make it clear that delivery by the rights owner of works or other subject matter by means of online transmission should always be characterised as a performance of service rather than a sale of goods, and therefore never exhausts the rights in those works.44 It should be noted that this is independent from any consideration related to whether the delivery is infinitely repeatable or not. In particular, recital 43 of the Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases45 stipulates that ‘whereas, in the case of on-line transmission, the right to prohibit re-utilization is not exhausted either as regards the database or as regards a material copy of the database or of part thereof made by the addressee of the transmission with the consent of the right holder’.46 Also, recital 18 of the Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (‘Directive on electronic commerce’) highlights that, ‘Information society services span a wide range of economic activities which take place on-line; these activities can, in particular, consist of selling goods on-line’.47 Similarly, recital 29 of the Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, establishes that the principle of Community exhaustion of rights ‘does not arise in the case of […] on-line services’.48 Finally, Article 3 of Directive 2001/29/EC also states that the: exclusive right to authorize or prohibit any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access them from a place and at a time individually chosen by them […] shall not be exhausted by any act of communication to the public or making available to the public.49

3.12 The distinction between online and offline distribution of goods, including software, was criticised by many as being ambiguous and able to allow the reintroduction of territorial restrictions in Europe and the partition of the EU internal market through technological change and party autonomy.50 Thus, ‘to avoid partitioning of markets [and] to limit restrictions of the distribution of those works to what is necessary to safeguard the specific subject-matter of the intellectual property concerned’,51 in the recent judgment UsedSoft v Oracle the CJEU characterised the making available of a copy of a computer program and the granting of a licence to download and use that copy permanently in return for the payment of a fee, as an operation involving the transfer of the right of

in this regard, it should be borne in mind in particular that reception of a satellite broadcast, such as that at issue in the main proceedings, requires possession of a decoding device. Consequently, it is possible to determine with a very high degree of precision the total number of viewers who form part of the actual and potential audience of the broadcast concerned, hence of the viewers residing within and outside the Member State of broadcast. 44 45 46 47 48 49 50

51

See Bertani, 240 footnote 445. See also Stothers, 790. Cook, ‘Exhaustion’, 358. OJ L 077/20, 27.03.1996. See also Wiebe, 114. In addition, the CJEU confirmed this result with the Judgment of the Court (Grand Chamber) in Case C-203/02 The British Horseracing Board Ltd. and Others v William Hill Organization Ltd. [2004] ECR I-10415. See also Wiebe, 114. OJ, L 178/1, 17.07.2000. Bertani, 241 OJ L 167/10, 22.6.2001. Sarti, 334; Wiebe, 114 and 118; Schovsbo, 180; Y. Harn Lee, ‘UsedSoft GmbH v Oracle International Corp. (Case C-128/11) – Sales of ‘used’ software and the principle of exhaustion’ (2012) International Review of Industrial Property and Copyright Law 43, 852. See also D. Sarti, in AIDA 2012, note 1469. Case C-128/11 UsedSoft GmbH v Oracle International Corp. 3 July 2012, not yet published, para. 62. See D. Sarti, in AIDA 2012, note 1469, 550, according to whom the aforementioned paragraph constitutes the ‘heart’ of the CJEU judgment.

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ownership,52 and therefore as a sale of goods.53 As a consequence, the CJEU applied the principle of exhaustion to online transactions,54 emphasising that it should make no difference whether the copy of the computer program was made available to the customer by the copyright owner by means of a download from a website or by means of a material medium such as a CD-ROM or DVD.55 Thus, the CJEU concluded that: the right of distribution of a copy of a computer program is exhausted if the copyright holder who has authorised, even free of charge, the downloading of that copy from the internet on to a data carrier has also conferred, in return for payment of a fee intended to enable him to obtain a remuneration corresponding to the economic value of the copy of the work of which he is the proprietor, a right to use that copy for an unlimited period.56

Since in the UsedSoft v Oracle judgment the CJEU limited its decision to ‘a copy of a computer 3.13 program’, ‘the downloading from the internet onto a data carrier’ and ‘a right to use that copy for an unlimited period’, it remains uncertain whether the Court’s conclusion applies to works protected under Directive 2001/29; such as e-Books or MP3 files,57 streaming and cloud computing operations,58 and subscription based models where buyers are granted access to a copy of the software for a limited period of time after the payment of an annual or other periodic fee.59 This possibility was dispelled in the recent case of Tom Kabinet,60 where the CJEU clarified that there is no digital exhaustion for any works protected under Directive 2001/29: the findings in the judgment of UsedSoft v Oracle constitute a lex specialis by comparison with that Directive and concern that very special category of works, namely computer programs.61 In relation specifically to e-Books, the Court followed the opinion of the Attorney General Szpunar62 in distinguishing between computer programs and traditional works such as books sold in intangible form: crucially,

52

53 54

55 56

Case C-128/11 UsedSoft v Oracle, para. 46. See S. Wolk, ‘The software business in transit – will exhaustion and defining sale or license soon be irrelevant?’ ICM Paper 2014/1 February 2014, http://www.imk.uu.se/Portals/4/IMCseries/2014/ 1/IMCPaperSeries2014–1_Wolk.pdf accessed 11 March 2014. Case C-128/11 UsedSoft v Oracle, para. 45. See Stothers, 790; Harn Lee, 852; L. Feiler, ‘Birth of the first-download doctrine – The application of the first-sale doctrine to internet download under EU and US copyright law’ (2012) Journal of Internet Law 16. For a comparison with the US system, L. Determann, ‘Digital Exhaustion: New Law from the Old World’ (2018) Berkeley TLJ, 33(1) 177; J.P. Kolczynski, ‘Exhaustion of copyright of computer software online: a European (Polish, German, Austrian) and US perspective’, (2011) European Intellectual Property Review, 33(9), 578–83; Feiler, 19; Stothers, 791; P. Heindl, ‘A comparative analysis of online distribution of software in the United States and Europe: piracy or freedom of “first use”?’ (2010) TTLF http://www.law.stanford.edu/sites/default/files/publication/205104/doc/slspublic/heindl_wp6.pdf accessed 15 February 2013; A. Perzanowski and J. Schultz, ‘Digital exhaustion’, (2010–2011) UCLA L. Rev. 58, 889; Westkamp, 54 ff. Case C-128/11 UsedSoft v Oracle, para. 46. See also the conclusion n. 2 according to which: Articles 4(2) and 5(1) of Directive 2009/24 must be interpreted as meaning that, in the event of the resale of a user licence entailing the resale of a copy of a computer program downloaded from the copyright holder’s website, that licence having originally been granted by that right holder to the first acquirer for an unlimited period in return for payment of a fee intended to enable the right holder to obtain a remuneration corresponding to the economic value of that copy of his work, the second acquirer of the licence, as well as any subsequent acquirer of it, will be able to rely on the exhaustion of the distribution right under Article 4(2) of that directive, and hence be regarded as lawful acquirers of a copy of a computer program within the meaning of Article 5(1) of that directive and benefit from the right of reproduction provided for in that provision.

57 58 59 60 61

62

For critique on the arguments on which this second conclusion is based see Sarti, 2012, 551. Kur and Dreier, 309; Harn Lee, 852. Cook, ‘Exhaustion’, 360. Harn Lee, 852. Case 263/18 NUV v Tom Kabinet EU:C:2019:1111. The Court grounds the existence of a lex specialis in relation to Directive 2001/29 in the intention and travaux préparatoires of the legislature with Directive 2009/24 of distinguishing between the electronic and tangible distribution of protected material (paras 55–56). Advocate General Szpunar, Opinion on Case 263/18 NUV v Tom Kabinet EU:C:2019:111.

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Chapter 3 THE PRINCIPLE OF FREE MOVEMENT OF GOODS

the existence of a computer program is merely a component of an e-Book, and is ‘only incidental in relation to the work contained in such a book. […] [a]n e-Book is protected because of its content, which must therefore be considered to be the essential element of it’.63 As a consequence, the Court seems to have maintained a distinction between online and offline distribution of goods for the purposes of Directive 2001/29, with the scope of potential exhaustion in relation to online goods significantly narrowed, and the right holder’s distribution rights strengthened.64 Nonetheless, the implications of this decision for the distribution of digital products should not be overstated. As the Attorney General observed, the digital resale model is increasingly historic, being replaced by streaming or subscription services which do not involve a transfer of ownership. Therefore ‘by recognising the rule of exhaustion of the right of distribution in the internet environment, the Court would thus resolve a problem that does not really need to be resolved and that to a large extent belongs to the past’.65 3.14 Yet, in relation to sale contracts, the CJEU in UsedSoft emphasised that the IPR owner is indeed in a position to determine the number of effective users of the protected works and to negotiate ex ante the payment of appropriate remuneration for the first sale of the file, even in the framework of online distribution.66 Although online distribution of digital content can increase the risk of the acquirer selling copies other than the acquired one, this risk is no higher than the one related to the reselling of physical exemplars of the protected work, such as used CDs. Indeed, digital right holders are in the position to potentially block the circulation of materials that have been unlawfully reproduced, and that the technological world enables potential competitors and any secondary markets to be found and put out of commerce much easier than in the material world.67 Therefore, online distribution of digital content only infringes the IPR in question when it leads to an effective increase in the availability of the circulating exemplars of the IPR protected work, whereas it does not produce any infringement when the seller, for example through a particular program, succeeds in transferring his file to the buyer and simultaneously erasing it from his dispositive.68 However, if we think of the rise in recent years of licence contracts and the decline of sale contracts in the digital world, then the problem of online distribution may become slightly less pressing. This is because under copyright law licence contracts involve the granting of access to works on a temporary basis in exchange for a periodic payment of the licence fee. No transfer of rights over the works occurs, and therefore this ‘model is based upon communication to the public of the said contents rather than their distribution’.69 Permanent copies of copyrighted works remain in the hands of their lawful owners.70

III. INTERNATIONAL EXHAUSTION 3.15 The principle of Community exhaustion of rights covers the EU territory only. The first placement of exemplars incorporating IPRs protected works on a market of a non-member State by the right

63 64

65 66 67 68 69 70

Case 263/18 NUV v Tom Kabinet EU:C:2019:1111, paras 63–67. A. Kaiser, ‘Exhaustion, Distribution and Communication to the Public – the CJEU’s Decision C-263/18 – Tom Kabinet on E-Books and Beyond’, (2020) GRUR International, 69(5), 495. See also V. Schröder, ‘The rise and (partial) fall of digital exhaustion as the CJEU hits the brakes in Tom Kabinet’ (2020) IPRInfo https://iprinfo.fi/artikkeli/the-rise-andpartial-fall-of-digital-exhaustion-as-the-cjeu-hits-the-brakes-in-tom-kabinet/ accessed 23 June 2020. Advocate General Szpunar, Opinion on Case 263/18 NUV v Tom Kabinet EU:C:2019:1111, para 96. See R.H. Rothstein, E.F. Evitt and M. Williams, ‘The First Sale Doctrine in the Digital Age’ (2010) Intellectual Property & Technology Law Journal 23–7. See e.g., C. Sganga, ‘A Plea for Digital Exhaustion in EU Copyright Law’ (2019) JIPITEC 10(3), para 7. Sarti, 2012, 551; R. Rivaro, ‘L’applicazione del principio di esaurimento alla distribuzione digitale di contenuti protetti’ in Giurisprudenza Commerciale, Giuffrè, Milan, 2014, 1149–64. P. Mezei, ‘Digital First Sale Doctrine Ante Portas – Exhaustion in the Online Environment’ (2015) JIPITEC 6(1), 51. A suggestion along these lines has been put forward by E. Verbraeken in ‘The Exhaustion Theory Is Not Yet Exhausted’ (2013) Les Nouvelles, 7–12.

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III. INTERNATIONAL EXHAUSTION

holder or with his consent, does not exhaust the exclusive IPR owner’s right to control the resale of these exemplars in the EU territory or in the rest of the EEA. This conclusion is in line with the previous CJEU jurisprudence related to IPRs other than copyright.71 Furthermore, the same conclusion has now been incorporated in various harmonising Directives, such as recital 28 and Article 4.2 of the Directive 2001/29, already mentioned. Yet, while the relevant rules of the TFEU on the freedom of movement of goods (abovementioned) 3.16 only concern goods that were first placed on the market within the EU territory, the exhaustion of rights provisions in the harmonising Directives go further and ‘override’ these Treaty rules.72 In excluding from their application goods that were first placed on the market outside EU territory or the rest of the EEA by or with the consent of the IPR owner, the relevant rules of the harmonising Directives ‘preclude’73 EU Member States’ national rules from providing for international exhaustion of the distribution right in respect of the original copies of a work placed on the market outside the EU by the right holder or with his consent, as the CJEU Laserdisken judgment highlighted in 2006.74 In particular, the Laserdisken judgment clarified that the exclusion of international exhaustion is:

3.17

in compliance with international law as well as with the Treaty rules on the establishment of a European policy of free and undistorted competition, the principles of proportionality and equal treatment, the framework of the European Convention on Human Rights (in particular the right to freedom of expression) and the Treaty provisions on culture, information and education.75

With particular regard to international law the preclusion of international exhaustion is in line with Article 6 of the TRIPs Agreement, which states that ‘nothing in this Agreement shall be used to address the issue of exhaustion of intellectual property rights’. Thus, the TRIPs Agreement leaves Member States free to adopt national, regional or international exhaustion systems, following a solution that compromises between countries supporting a national exhaustion system and States adopting an international exhaustion regime. In addition, Article 1(1) TRIPs leaves party States free to implement stronger IPRs protection, and therefore some countries (such as the USA) have concluded so-called ‘TRIPs-plus’ bilateral or multilateral regional agreements with other countries, imposing a national exhaustion system with regard to the mutual commercial relationship. However, according to an opinion, national (and regional) exhaustion regimes, unlike the international exhaustion system, pose detrimental and artificial barriers to international trade of goods, negatively impact on furthering commercial and economic integration, and are therefore contrary to ‘the spirit, rules and targets of the GATT/WTO system’.76

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights signed on 15 April 1994 (TRIPS). Council Directive 91/250/EEC of the European Parliament and of the Council of 14 May 1991 on the legal protection of computer programs, OJ L 122/42, 17.05.1991. Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 346/61 27.11.1992.

71 72 73 74 75 76

Cook, EU Intellectual Property Law, 2010, 17. Ibid., 19. Case C-479/04 Laserdisken ApS v Kulturministeriet [2006] ECR I-08089. Ibid, second conclusion. See Bertani, 242. Leistner, 856–7. Bonadio, 158–9.

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Chapter 3 THE PRINCIPLE OF FREE MOVEMENT OF GOODS Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases, OJ L 077/20, 27.03.1996. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.6.2001. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, OJ L 178/1, 17.07.2000. Directive 2006/115 of the European Parliament and of the Council on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376/28, 27.12.2006. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs, OJ L 111/16, 05.05.2009. The Agreement on the European Economic Area, 1 January 1994 (EEA Agreement). Treaty on the Functioning of the European Union, [2010] OJ C 83/47.

2. CJEU case law British Horseracing Board Ltd. and Others v William Hill Organization Ltd. (Case C-203/02) [2004] ECR I-10415. Dansk Supermarked v Imerco (Case 58/80) [1981] ECR 181. Deutsche Grammophon Gesellschaft mbH v Metro-SB-Großmärkte GmbH & Co. KG (Case 78/70) [1971] ECR 487. Etablissements Consten S.à.R.L. and Grundig-Verkaufs-GmbH v Commission of the European Economic Community (Cases 56 and 58/64) [1966] ECR 429. Falco Privatstiftung and Thomas Rabitsch v Gisela Weller-Lindhorst (C-533/07) [2009] ECR I-03327. Football Association Premier League Ltd. and Others v QC Leisure and Others and Karen Murphy v Media Protection Services Ltd. (C-403/08 and C-429/08) [2011] ECR I-09083. Laserdisken ApS v Kulturministeriet (C-479/04) [2006] ECR I-08089. Ministère public v Jean-Louis Tournier (Case 395/87) [1989] ECR 02521. Musik-Vertrieb Membran GmbH and K-tel International v GEMA (Cases 55/80, 57/80) [1981] ECR 147. NUV v Tom Kabinet (Case 263/18) EU:C:2019:1111. Parfums Christian Dior SA v Evora BV (C-337/95) [1997] ECR I-6013. Peak Holding AB v Axolin-Elinor AB (C-16/03) [2004] ECR I-11313. Peek & Cloppenburg v Cassina (C-456/06) [2008] ECR I-2731. SA Compagnie générale pour la diffusion de la télévision, Coditel, and Others v Ciné Vog Films and Others (Case 62/79) [1980] ECR 00881. UsedSoft GmbH v Oracle International Corp. (Case C-128/11) 3 July 2012, EU:C:2012:407. Warner Brothers Inc. and Metronome Video ApS v Erik Viuff Christiansen (Case 158/86) [1988] ECR I-02605.

3. Bibliography Beier, F.K. ‘Territoriality of Trademark Law and National Trade’ (1970) International Review of Industrial Property and Copyright Law, 1(1), 57. Bertani, M. Diritto d’autore europeo, Giappichelli, Torino, 2012. Bonadio, E. ‘Parallel imports in a global market: Should a generalised international exhaustion be the next step?’, (2011) European Intellectual Property Review, 33(3), 153–61. Cook, T. ‘Exhaustion – A casualty of the borderless digital era’, in L. Bently, U. Suthersanen and P.L.C. Torremans (eds), Global Copyright, Three Hundred Years Since the Statute of Anne, from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010. Cook, T. EU Intellectual Property Law, Oxford University Press, Oxford, 2010. de Miguel Asensio, P. ‘Comment to Falco’, (2009) Rev. española Der. Int. Determann, L. ‘Digital Exhaustion: New Law from the Old World’, (2018) Berkely TJL, 33(1), 177. Dreier, T. ‘Online and its Effects on the ‘Goods versus Services’ Distinction’, (2018) IIC, 4(2), 137. Feiler, L. ‘Birth of the First-download Doctrine – The Application of the First-sale Doctrine to Internet Download under EU and US Copyright Law’, (2012) Journal of Internet Law, 16. Harn Lee, Y. ‘UsedSoft GmbH v Oracle International Corp. (Case C-128/11) – Sales of “Used” Software and the Principle of Exhaustion’, (2012) International Review of Industrial Property and Copyright Law, 43, 852. Heindl, P. ‘A Comparative Analysis of Online Distribution of Software in the United States and Europe: Piracy or Freedom of “First Use”?’, (2010) TTLF at http://www.law.stanford.edu/sites/default/files/publication/205104/doc/ slspublic/heindl_wp6.pdf.

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NOTES Hilty, R.M. ‘Exhaustion in the digital age’, in I. Calboli and E. Lee, Research Handbook on Intellectual Property Exhaustion and Parallel Imports, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2016. Kaiser, A. ‘Exhaustion, Distribution and Communication to the Public – the CJEU’s Decision C-263/18 – Tom Kabinet on E-Books and Beyond’, (2020) GRUR International, 69(5), 495. Kolczynski, J.P. ‘Exhaustion of Copyright of Computer Software Online: a European (Polish, German, Austrian) and US Perspective’, (2011) European Intellectual Property Review, 33(9), 578–83. Kur, A. and T. Dreier, European Intellectual Property Law, Text, Cases and Materials, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2013. Leistner, M. ‘Copyright Law in the EC: Status Quo, Recent Case Law and Policy Perspectives’, (2009) CMLR, 46, 860. Lucas, A. ‘International exhaustion’, in L. Bently, U. Suthersanen and P.L.C. Torremans (eds), Global Copyright, Three Hundred Years since the Statute of Anne, from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010, 306. Mezei, P. Copyright Exhaustion: Law and Policy in the United States and the European Union, Cambridge University Press, Cambridge, 2018. Mezei, P. ‘Digital First Sale Doctrine Ante Portas – Exhaustion in the Online Environment’, (2015) JIPITEC 6(1), 51. Perzanowski, A. and J. Schultz, ‘Digital exhaustion’, (2010–2011) UCLA L. Rev. 58, 889. Pope, A.B. ‘A Second Look at First Sale: An International Look at U.S. Copyright Exhaustion’, (2011–2012) Journal Int. Prop. Law, 19, 201. Rivaro, R. ‘L’applicazione del principio di esaurimento alla distribuzione digitale di contenuti protetti’, (2014) Giur Comm I, 1149. Rosén, J. Intellectual Property at the Crossroads of Trade, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2012. Rothstein, R.H., E.F. Evitt, and M. Williams, ‘The First Sale Doctrine in the Digital Age’, (2010) Intellectual Property & Technology Law Journal, 23–7. Sarti, Diritti esclusivi e circolazione dei beni, Giuffrè, Milano, 1996. Schovsbo, J. ‘Free movement of goods and exhaustion’, in A. Ohly (ed.), Common Principles of European Intellectual Property Law, Mohr Siebeck, 2012, 171. Schröder, V. ‘The rise and (partial) fall of digital exhaustion as the CJEU hits the brakes in Tom Kabinet’, (2020) IPRInfo, https://iprinfo.fi/artikkeli/the-rise-and-partial-fall-of-digital-exhaustion-as-the-cjeu-hits-the-brakes-intom-kabinet/ accessed 23 June 2020. Stamatoudi, I. ‘From Drugs to Spirits and from Boxes to Publicity (decided and undecided issues in relation to trade marks and copyright exhaustions)’, (1999) Intellectual Property Quarterly, 103. Stothers, C. ‘When Is Copyright Exhausted by a Software License UsedSoft v Oracle ’, (2012) European Intellectual Property Review, 11, 791. Torremans, P.L.C. ‘Introduction to Part III’, in L. Bently, U. Suthersanen and P.L.C. Torremans (eds), Global Copyright, Three Hundred Years since the Statute of Anne, from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010. Torremans, P.L.C. and I. Stamatoudi, ‘International Exhaustion in the European Union in the Light of “Zino Davidoff”: Contract, Versus Trademark Law?’, (2000) International Review of Industrial Property and Copyright Law, 31(3), 131. Ubertazzi, B. ‘Licence Agreements Relating to IP Rights and the EC Regulation on Jurisdiction’, (2009) International Review of Industrial Property and Copyright Law, 40, 912–39. Verbraeken, E. ‘The Exhaustion Theory is not yet Exhausted’, (2013) Les Nouvelles, 7–12. Westkamp, G. ‘Emerging escape clauses? Online exhaustion, consent and European copyright law’, in J. Rosén, Intellectual Property at the Crossroads of Trade, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2012. Wiebe, A. ‘The principle of exhaustion in European copyright law and the distinction between digital goods and digital services’, (2009) GRUR International, 58(2), 114. Wolk, S. ‘The Software business in transit – will exhaustion and defining sale or license soon be irrelevant?’, ICM Paper 2014/1 February 2014, at http://www.imk.uu.se/Portals/4/IMCseries/2014/1/IMCPaperSeries2014–1_ Wolk.pdf, accessed 11 March 2014.

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4 THE ESSENTIAL FACILITIES PRINCIPLE AND OTHER ISSUES OF COMPETITION Alison Firth1 ARTICLE 102 TFEU (ex Article 82 TEC, previously Article 86 EEC) Any abuse by one or more undertakings of a dominant position within the internal market or in a substantial part of it shall be prohibited as incompatible with the internal market in so far as it may affect trade between Member States. Such abuse may, in particular, consist in: (a) (b) (c) (d)

directly or indirectly imposing unfair purchase or selling prices or other unfair trading conditions; limiting production, markets or technical development to the prejudice of consumers; applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage;2 making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts.

RELATED LEGAL INSTRUMENTS ARTICLE 101 TFEU (EX ART. 81 TEC) 1.

The following shall be prohibited as incompatible with the internal market: all agreements between undertakings, decisions by associations of undertakings and concerted practices which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the internal market, and in particular those which: (a) directly or indirectly fix purchase or selling prices or any other trading conditions; 1

2

This chapter was developed at the University of Canterbury, Christchurch, New Zealand in the course of an Erskine Visiting Fellowship in the Faculty of Business and Law, Department of Accounting and Information Systems (ACIS). Grateful thanks to the University, and to its Erskine scheme, for making this possible. Warm thanks to colleagues from ACIS and the School of Law for stimulating and useful comments and suggestions and to Library and IT colleagues for guiding me to the excellent facilities at Canterbury. Last but not least, an especial thank you to the patient and erudite editors of this book. All errors and infelicities, sadly, remain, my own. If competitor harm but no consumer harm were required, this indent would differ from the rest of 102 and 101: John Temple Lang ‘Commonly Accepted Errors and Misunderstandings in European Competition Law – Abuse of Dominance and Patent Licensing’ St Gallen International Competition Law Forum, 7–8 June 2012, www.sg-icf.ch.

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I. ARTICLE 102 AND ITS CONTEXT

2. 3.

I.

(b) limit or control production, markets, technical development, or investment; (c) share markets or sources of supply; (d) apply dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage; (e) make the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts. Any agreements or decisions prohibited pursuant to this Article shall be automatically void. The provisions of paragraph 1 may, however, be declared inapplicable in the case of: – any agreement or category of agreements between undertakings, – any decision or category of decisions by associations of undertakings, – any concerted practice or category of concerted practices, which contributes to improving the production or distribution of goods or to promoting technical or economic progress, while allowing consumers a fair share of the resulting benefit, and which does not: (a) impose on the undertakings concerned restrictions which are not indispensable to the attainment of these objectives; (b) afford such undertakings the possibility of eliminating competition in respect of a substantial part of the products in question.

ARTICLE 102 AND ITS CONTEXT 1. Introduction 2. Deconstructing Article 102 A. Effect on trade between Member States B. ‘Undertaking’ C. ‘Market’ D. Dominance 3. Competition A. ‘Competition’ and efficiency B. Competition by imitation, competition by substitution and copyright C. Competition by extension? D. Competition in a market versus competition for a market 4. Abuse of dominance A. Varieties of abuse B. Development of refusal to supply and the parameters of ‘essential facility’ cases

4.01 4.01 4.05 4.05 4.06 4.08 4.13 4.16 4.16

5. A ‘defence’ of objective justification?

4.39

II. MAGILL AND BEYOND – ESSENTIAL FACILITY CASES RELATING TO COPYRIGHT 1. Magill 2. Tiercé Ladbroke 3. IMS 4. Microsoft

4.43 4.44 4.50 4.51 4.56

III. SOME QUERIES AND OBSERVATIONS 1. Nature of ‘essential facility’ or ‘indispensable input’ in copyright cases 2. Nature of the remedy? 3. What about interim measures? 4. Essential facilities and WTO TRIPS 5. Where has the essential facilities doctrine gone? 6. Conclusion

4.17 4.20 4.21 4.22 4.22

4.64 4.64 4.68 4.69 4.70 4.76 4.80

4.31

I. ARTICLE 102 AND ITS CONTEXT 1. Introduction Article 102 TFEU is concerned to protect freedom of competition in the European Union’s (EU) 4.01 ‘single market’ or ‘internal market’; competition law makes an important contribution to the goal of

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Chapter 4 THE ESSENTIAL FACILITIES PRINCIPLE AND OTHER ISSUES OF COMPETITION

market integration.3 Article 102 (formerly Art. 82EC) has been described as, ‘the legal basis for a crucial component of competition policy … its effective enforcement helps markets to work better for the benefit of businesses and consumers. This is particularly important in the context of the wider objective of achieving an integrated internal market’.4 4.02 As articulated by AG Jacobs in Bronner,5 its ‘principal purpose is to prevent the distortion of competition – and in particular to safeguard the interest of consumers6 – rather than to protect the position of particular competitors’.7 Nevertheless, where an essential facility exists8 is controlled by a dominant undertaking and a competitor’s ability to compete is being prevented or hindered by refusal of access to the facility, the competitor may be able to complain to the Competition Authorities9 of abuse of dominance and request access as a remedy. The essential facility might be something tangible, such as a transport terminal,10 infrastructure,11 or other transport facility,12 a public telecommunication network or service,13 or intangible, such as finance,14 a copyright licence,15 or access to software code,16 or a licence to use a standard-essential patent.17

3

4 5 6

7 8

See, e.g., ‘Competition policy’ factsheet at https://www.europarl.europa.eu/factsheets/en/sheet/82/competition-policy. The Treaty’s rules on free movement of goods and services are also vital for market integration. See, further in this volume, Agnès Lucas-Schloetter Chapter 1 at 1.05–1.06; Benedetta Ubertazzi, Chapter 3. Communication from the Commission – Guidance on the Commission’s enforcement priorities in applying Art. 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings (2009/C 45/02) OJ C 45/7, 24.2.2009, para. [1]. C-7/97 Oscar Bronner GmbH & Co KG v Mediaprint Zeitungs-und Zeitschriftenverlag GmbH & Co KG [1998] ECR I-7791 (ECJ (6th Chamber)). For a sceptical view, see P. Akman, ‘“Consumer Welfare” and Article 82EC: Practice and Rhetoric’, (2009) World Competition, 32(1), 71–90. For the relationships between consumer law and competition law, see K.J. Cseres ‘The Controversies of the Consumer Welfare Standard’, (2006) Comp L Rev, 3(2), 121–73. S. Nathani and P. Akman ‘The Interplay Between Consumer Protection and Competition Law in India’ (2017) J Antitrust Enforcement 197. However, indent (b) which is most relevant to this chapter does refer to the consumer. Temple Lang has suggested that indents (a) and (d) also involve harm to consumers ‘more or less clearly’: J. Temple Lang ‘Commonly accepted errors’. A competitor may complain of discrimination by the dominant firm under indent (c). In relation to the COVID-19 crisis: The main challenge at the present time is not access to vaccines, treatments or cures for COVID-19, but the absence of any approved vaccines, treatments or cures to have access to. The policy focus of governments at this stage should therefore be on supporting science and innovation that will produce a vaccine, treatments or cures.

9 10

11 12

13 14 15 16

17

Francis Gurry, (director of the World Intellectual Property Organisation) ‘Some Considerations on Intellectual Property, Innovation, Access and COVID-19’, 24 April 2020, available at: https://www.wipo.int/about-wipo/en/dgo/ news/2020/news_0025.html. Suspending competition rules in this area may be necessary and desirable. The European Commission’s DG Competition and National Competition Authorities, see Reg 1/2003. E.g., Sea Containers v Stena Link – Interim Measures (Case IV/34.689) Commission Decision 94/19/EC, 1994 OJ (L 015) 8 (relating to a proceeding pursuant to Art. 86 of the EC Treaty); B&I Line v Sealink Harbours and Stena Sealink [1992] 5 CMLR 255; Port of Rødby Commission Decision 94/119/EC, 1994 OJ (L 055) 52; Irish Continental Group/ CCI Morlaix (Port of Roscoff) [1995] CMLR 77; in the first two cases but not the last, the port operator had an interest in ferry operation. Joined Cases T-374/94, T-375/94, T-384/94 and T-388/940, European Night Services Ltd (ENS) v Commission [1998] ECR II-3141; [1998] 5 CMLR 718 – facilities held not to be essential. E.g., airline reservation and sales systems: London-European Sabena (Case IV/32.318) Commission Decision 88/589/ EEC, 1988 OJ L 317/ 47; British Midland/Aer Lingus (Case IV/33544) Commission Decision 92/213/EEC, 1992 OJ (L 96) 34. Specifically mentioned in the definition of ‘essential facility’ in Art 15(1) of the EU-Canada Comprehensive and Economic Trade Agreement (CETA). Case T-301/04 Clearstream Banking v Commission [2009] ECR II-3155; [2009] 5 CMLR 24. E.g., ‘Magill ’ Case C-241/91P Radio Telefis Eireann v Commission of the European Communities [1995] ECR I-743; [1995] 4 CMLR 718. E.g. Case T-201/04 Microsoft Corp (The Computing Technology Industry Association Inc and Others, intervening) v Commission of the European Communities (Software & Information Industry Association and Others, intervening) [2007] ECR II-3601; [2007] 5 CMLR 11. The doctrine was not applied in Contact Software v Commission T-751/15 ECLI:EU:T:2017:602. On fair, reasonable and non-discriminatory (‘FRAND’) terms, as in Unwired v HuaWei [2018] EWCA Civ 2344; Huawei Technologies Co Ltd v ZTE Corp C-170/13, EU:C:2015:477, [2015] Bus. L.R. 1261, and other cases discussed in

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I. ARTICLE 102 AND ITS CONTEXT

Article 102 constitutes one of three main strands of EU competition law, the others being Article 4.03 101, which regulates restrictive agreements and is relevant to copyright licensing,18 and the ‘Merger Regulation’, under which large-scale mergers and other concentrations are assessed by the European Commission.19 The borderline between agreements (Art. 101) and the unilateral practices which may be subject to Article 102 has vexed courts and regulators in the past but now appears reasonably settled,20 although there remains a hazy region between the concept of concerted practice under Article 101 and that of collective dominance under Article 102.21 This chapter will focus on the use of Article 102 in situations where a copyright holder enjoys 4.04 significant economic power on a particular market22 and wields copyright in such a way as to constitute an abuse of dominance, especially by refusal to license.23 In exceptional situations of this nature, the competition authorities may order that the competitor be given access to and/or be licensed to use the work in question. This despite the fact that the right to license, or not, is central to copyright. As the World Intellectual Property Organization has put it: Refusing to license is at the core of an IP right. Therefore, denying IPR owners the right to refuse to license is the same as denying the exploitation of the very IP.24 There are, however, some few situations in which the IP owner may be deprived from his/her intrinsic right to say ‘no’.25

18

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E. Kurgonaite, P. Treacy, and E. Bond ‘Looking Back to the Future – Selective SEP Licensing Through a Competition Law Lens?’ [2020] J Eur Comp L & Prac 1. Please see later chapters in this work: Ch. 13 – The Orphan Works Directive (U. Suthersanen and M.M. Frabboni) and Ch. 14 – The Collective Rights Management Directive (L. Guibault); see, also, on collective management issues, Josef Drexl ‘Competition in the Field of Collective Management: Preferring ‘Creative Competition’ to Allocative Efficiency in European Copyright Law’, Ch. 11 and Marco Ricolfi ‘Individual and Collective Management of Copyright in a Digital Environment’, Ch .12 in P.L.C. Torremans (ed) Copyright Law A Handbook of Contemporary Research, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2008. Council Reg (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings OJ L 24/1 29.1.2004. See, e.g. Case T-464–04 IMPALA [2006] ECR II 2289, where Sony/Bertelsman merger in the music industry was allowed by the European Commission but successfully challenged by a third party before the Court of First Instance (now General Court). The European Commission’s remedial practice in relation to concentrations includes access remedies: Commission Notice ‘on remedies acceptable under the Council Regulation (EC) No 139/2004 and under Commission Regulation (EC) No 802/2004’, OJ 2008/C 267/01 22.10.2008. For proposed revision, see https://ec.europa.eu/competition/mergers/legislation/merger_remedies.html. Note that, after Brexit transition year 2020, EU ‘one-stop-shop’ clearance of concentrations will no longer apply in the UK. Joined Cases C-2/01 and 3/01 P Bundesverband der Arzneimittel-Importure eV (BAI) and Commission v Bayer [2004] ECR I-23. Italian Flat Glass OJ 1999 L33/44, [1990] 4 CMLR 535; Case C-393/92 Almelo v NV Energiebedrif Ijsselmij [1994] ECR I-1477. See, also, L.L. Gormsen ‘Collective dominance: An overview of national case law’ e-Competitions| N° 72449, www.concurrences.com, available at https://www.biicl.org/documents/10061_554_collective_dominance.pdf. Commission notice ‘on the definition of relevant market for the purposes of Community competition law’ OJ C372/5, 09.12.1997. J.P. Sluijs, P. Larouche, W. Sauter ‘Cloud Computing in the EU Policy Sphere: Interoperability, Vertical Integration and the Internal Market’ (2012) JIPITEC 12, 22 have a useful section on market definition. L. Longdin and I. Eagles, Refusals to License Intellectual Property: Testing the Limits of Law and Economics, Hart, Oxford, 2011, passim. Or even perhaps denying the existence of the IP. On which, see Agnès Lucas-Schloetter, Ch 1 at 1.05 and 1.13. August 2013 report on refusals to license prepared by the WIPO Secretariat ‘Refusals to License IP Rights – a Comparative Note on Possible Approaches’ para. 37. Available from http://www.wipo.int/portal/en/. Similar sentiments were expressed by the Court of Justice in Volvo v Veng: see below at para. 4.30. In some cases the copyright legislation itself acknowledges competition concerns, for example Arts 13 and 16 of the Database Directive, discussed by E. Derclaye in Ch. 9 of this work: Recital 12 of the Enforcement Directive, discussed by I. Stamatoudi in Ch 12. Competition considerations are discussed in the context of the Wittem code and the ‘Declaration on the Balanced Interpretation of the Three-step-test in Copyright law’ in Ch 11. ‘The Information Society Directive’ (C. Geiger and F. Schönherr (Arts 5 and 6(4)) I. Stamatoudi and P.L.C. Torremans)

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Chapter 4 THE ESSENTIAL FACILITIES PRINCIPLE AND OTHER ISSUES OF COMPETITION

Before considering the circumstances in which such a remedial ‘compulsory licence’ may be ordered,26 some general considerations and assumptions will be discussed.

2. Deconstructing Article 102 A. Effect on trade between Member States 4.05 The initial words of Article 102 make clear that an effect on interstate trade is needed to engage the prohibition.27 This can be rather readily found in Article 102 cases; as the just-cited Guidelines on effect on trade note: ‘According to settled case law the concept of “trade” also encompasses cases where agreements or practices affect the competitive structure of the market.’ Assuming that an effect on interstate trade is present, conduct will come under the purview of EU competition law, which may be enforced by the European Commission or by a National Competition Authority (NCA) under Reg 1/2003.28

B. ‘Undertaking’ 4.06 For Article 102 to apply, the dominant copyright holder must be an ‘undertaking’, defined in Hofner as ‘any entity engaged in an economic activity, irrespective of its legal status and the way in which it is financed’.29 The term includes economically active individuals, such as authors and inventors.30 ‘Economic activity’ has, in turn, been characterised in terms of offering goods and services on a market.31 In Hofner, a government employment agency competing with private agencies was held to be an undertaking. However, if the economic aspects of the activity are inextricably linked with public functions, the entity will not be an ‘undertaking’ and Article 102 will not apply.32 This was the case in Compass-Datenbank GmbH v Republik Österreich,33 where it was held that the Austrian Government in its function of maintaining a register of companies and providing access to the companies database via a billing agency was not an ‘undertaking’. In these circumstances, its refusal to supply access to the complainant could not be a breach of Article 102. The duties of a state affirmatively to protect competition are limited, subject to the rather woolly provisions of Article 106 TFEU.34 Rather, the task is to comply with public procurement rules.

26

27

28 29 30 31 32

33

34

The extent to which orders to license require positive monitoring may mar their effectiveness, especially in protecting potential new markets yet to be established in the data economy. See, e.g., J. Drexl ‘Designing Competitive Markets for Industrial Data – Between Propertisation and Access’ (2016) Max Planck Institute for Innovation & Competition Research Paper No. 16-13 at p 44. Available at https://ssrn.com/abstract=2862975. Commission notice, ‘Guidelines on the effect on trade concept contained in Articles 81 and 82 of the Treaty’ OJ C101/81, 27.04.2004; Case C-6/73 and 7/73 Commercial Solvents v Commission [1974] ECR 223; [1974] 1 CMLR 309; Case 22/78 Hugin Kassaregister AB and Hugin Cash Registers Ltd v Commission [1979] ECR 1869; [1979] 3 CMLR 345 (no effect on trade as Sweden not then a member of the European Community). Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty [2003] OJ L1/1, the so-called ‘Modernisation’ Regulation. Case C-41/90 Hofner and Elser v Macrotron GmbH [1991] ECR I-1979 at [21]. E.g., self-employed inventor Reuter/BASF [1976] 2 CMLR D44. E.g., Case T-319/99 Federación Nacional de Empresas de Instrumentación Científica, Médica, Técnica y Dental (FENIN) v Commission [2003] ECR II-357. ‘Competition rules do not apply to activity which, by its nature, its aims and the rules to which it is subject does not belong to the sphere of economic activity […] or which is connected with the exercise of the powers of a public authority’: Case C-309/99 Wouters v Algemene Raad van Dederlandsche Orde van Advocaten [2002] ECR I-1577; [2002] 4 CMLR 913; Case C-364/92 SAT Fluggesellschaft v Eurocontrol [1994] ECR I-43; [1994] 5 CMLR 208. Case C-138/11 Compass-Datenbank GmbH v Republik Österreich [2012] 5 CMLR 13. In view of its finding on the undertaking point, the CJEU found it unnecessary to answer another question highly relevant to essential facilities cases – whether the dominant undertaking needs to be vertically integrated for the access jurisprudence to apply. In Morlaix (Port of Roscoff) n 10 above, this was not the case. Described by C. Graham, EU and UK Competition Law, Longman, 2010, (2nd ed, 2013) Chapter 8, as a ‘strange and unclear provision’.

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I. ARTICLE 102 AND ITS CONTEXT

We shall assume that the copyright holder is an ‘undertaking’ for the purposes of this chapter. The 4.07 complainant is usually also an undertaking, although Article 102 itself does not require this.

C. ‘Market’ Although Article 102 refers to the ‘internal market’, suggesting an undifferentiated economic zone 4.08 within the borders of the EU, it is accepted that competition occurs in more tightly defined markets, which have three aspects or dimensions.35 First, competition occurs on a ‘product market’, between products that are substitutable one for the other.36 Thus, suppliers of bananas may or may not compete with suppliers of other soft fruit,37 but they definitely do not compete with suppliers of spare parts for motorcars. Second, the relevant market on which competition occurs has a geographical dimension, the zone 4.09 where conditions of competition are (relatively) homogeneous.38 For services and local products, the relevant geographical market may be quite narrow. Third, the relevant market may have a temporal dimension,39 which would be cyclical in the case of 4.10 seasonal supply or demand, or non-cyclical in the case of a fast-developing technology. Although the temporal dimension is disregarded in the Commission’s notice on market definition,40 competition analyses do take into account potential competition41 and hence envisage temporal development. Graef posits that, over the longer term, competition for new markets as opposed to competition in existing markets is of vital importance, though more difficult to accommodate into competition enforcement.42 Narrow market definition correlates with a finding of dominance43 (discussed below) and also with 4.11 the identification of distinct upstream and downstream markets,44 across which the dominant firm may enjoy vertical integration, a factor common to many if not all of the cases on essential facilities.

35

36 37 38

39 40 41 42

43 44

Case 27/76 United Brands v Commission [1978] ECR 207. For the first two, see guidance in Commission notice ‘on the definition of relevant market for the purposes of Community competition law’ OJ C372/5, 09.12.1997; S. Baker and L.Wu, ‘Applying the market definition guidelines of the European Commission’ (1998) ECLR 273; M. Sousa Ferro Market Definition in EU Competition Law (Edward Elgar, 2019). Commission Notice, para. 7. Not, according to United Brands. See also Case 85/76 Hoffmann-La Roche AG v Commission of the European Communities [1979] ECR 461; [1979] 3 CMLR 211 (vitamins). Case 27/76 United Brands, Commission notice. See, also, A. Fletcher and B. Lyons ‘Geographic Market Definition in European Commission Merger Control’ (2016) available at https://ec.europa.eu/competition/publications/reports/ study_gmd.pdf. Ibid. See n 35 above. E.g., Case T-30/89 Hilti v Commission [1991] ECR II-1439, upheld in Case C-53/92 P Hilti v Commission [1994] ECR I-667. I. Graef, Rethinking the Essential Facilities Doctrine for the EU Digital Economy (2019) at section 3.1, available at: https://www.researchgate.net/publication/332401208_Rethinking_the_essential_facilities_doctrine_for_the_EU_digital_ economy. The European Commission’s market definition in Continental Can [1972] CMLR D11 was criticised on appeal as excessively narrow. In Case C-53/92P Hilti v Commission, separate markets were identified for nail guns, nail cartridges and nails, despite Hilti’s argument that they constituted an integrated system. See discussion of these issues by S.D. Anderman and H. Schmidt, ‘EC Competition Law and IPRs’ in Steven D. Anderman (ed.) The Interface Between Intellectual Property Rights and Competition Policy, Cambridge University Press, 2007, 41–7. See, also, J.P Sluijs, P. Larouche and W. Sauter, ‘Cloud Computing in the EU Policy Sphere: Inter-operability, Vertical Integration and the Internal Market’ (2012) JIPITEC 12.

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4.12 Some critics argue that the importance of market definition has been overestimated, especially in merger cases.45 The European Commission has launched its ‘road-map’ for a process to evaluate (and perhaps amend) the Notice on market definition.46 The road-map was open for comment between 3 April and 15 May 2020. Sousa Ferro47 made a number of pertinent comments, including: a.

b. c.

as well as product and geographic market aspects, the relevant market ‘can also include a temporal market (plus the fundamental issue of the temporal framework of any market definition)’; not only is market definition relevant for Antitrust and Merger Control, as mentioned in the road-map, but also for State Aid and in a ‘myriad of procedural issues’; ‘the general tone of the roadmap seems to be that the Commission intends to revise the market definition Notice to take into account the digitalisation and globalisation of the economy. A preconception seems to be implied that a change in the current market definition method is required to adapt it to these new types of markets, and this is probably not the case.’

D. Dominance 4.13 The concept of a ‘dominant position’ connotes considerable economic power on the relevant market, such that the undertaking can ‘prevent effective competition … by power to behave to an appreciable extent independently of its competitors, customers and ultimately of its consumers’.48 The existence of copyright or other intellectual property rights (IPRs) will not automatically confer such power,49 but an undertaking with exclusive rights is in a good position to lock out competitors and lock in customers.50

45

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48 49

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E.g., T. Hoehn (citing Kai-Uwe Kuhn) ‘The scope for errors, misconceptions and misunderstandings in the enforcement of European Competition Law’ Paper delivered at 19th St Gallen Competition Law Forum, 7 and 8 June 2012, available at http://ssrn.com/abstract=2224043. EU competition law – market definition notice (evaluation), available at https://ec.europa.eu/info/law/better-regulation/ have-your-say/initiatives/12325-Evaluation-of-the-Commission-Notice-on-market-definition-in-EU-competitionlaw. M. Sousa Ferro, feedback reference F511271, 9 April 2020, available at https://ec.europa.eu/info/law/better-regulation/ have-your-say/initiatives/12325-Evaluation-of-the-Commission-Notice-on-market-definition-in-EU-competitionlaw/F511271. By way of background, M. Sousa Ferro is the author of Market Definition in EU Competition Law, see n 35 above. Case 27/76 United Brands [1978] ECR 207; 1 CMLR 429; Case 85/76 Hoffmann-La Roche AG v Commission of the European Communities. Case 24/67 Parke Davis v Proebel [1968] ECR 55; [1968] CMLR 47; although it may do so AstraZeneca v Commission C-457/10, EU:C:2012:770 at [186]. Stamatoudi has criticised the European Commission and Courts’ circular reasoning in Magill where, having reiterated the principle that possession of copyright does not automatically confer dominance, effectively got back to that position and implied that exercise of exclusivity would automatically infringe Art. 102 TFEU (ex Art. 86 EEC). I. Stamatoudi, ‘The Hidden Agenda in Magill and its Impact on New Technologies’ (1998) World Intellectual Property 1, 153, 156. The European Commission’s Art. 102 enforcement policies prioritise such exclusionary conduct: Commission communication ‘Guidance on the Commission’s enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings’ OJ C 45/02 24/02/2009. Lock-in may also be caused by so-called network effects, whereby the utility of a service increases with the numbers of users, leading to a particular service rapidly becoming dominant. See, e.g., P. Ibáñez Colomo, ‘EU Competition Law in the Regulated Network Industries’ LSE Law, Society and Economy Working Papers 08/2016 at p4. Available at http://eprints.lse.ac.uk/66573/ 1/__lse.ac.uk_storage_LIBRARY_Secondary_libfile_shared_repository_Content_LSE%20Working%20Paper_EU%20 Competition%20Law_Ibabez_Colomo_EU_Competition_Law_Author.pdf.

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This is especially the case in ‘secondary markets’ for items such as motor spares,51 cartridges for printers,52 nails for nail guns53 other consumables.54 A high share of the relevant market is necessary for a finding of dominance and a very high share 4.14 will lead to a presumption of dominance.55 Dominance was found with a market share of 50 per cent in Akzo Chemie.56 However, dominance has been found with lower market shares where the undertaking is the only sizeable enterprise on the market57 or there are significant legal, technical or financial barriers to market entry, consumer inertia or the costs of switching products or suppliers is high. Vertical integration of the dominant firm is also a relevant factor and may lead to a finding that dominance in one market may be abused by conduct in relation to another. The dominance must be present across the EU or a substantial part of the EU, which may be a 4.15 single Member State58 or even a significant port or region within a Member State.59

3. Competition A. ‘Competition’ and efficiency The all-important concept of competition is often characterised in terms of rivalry between 4.16 undertakings, encouraging efficiency. However, the economists’ concept of ‘perfect competition’, whereby producers of indistinguishable products engage in price rivalry, sits ill with the notion that consumer welfare may best be served by innovation. A succinct account of different forms of efficiency is provided by Mackenrodt:60 i.

ii.

51 52

53 54 55 56 57 58

59 60 61

Productive efficiency: this can be seen at the level of individual undertakings and ‘arises primarily through economies of scale and scope’. One may note that such economies tend to be achieved by larger undertakings or collaborations.61 Static efficiency: ‘modeled on given competition parameters like price and quantity, and best achieved through perfect competition’. The popularity of this model probably lies in the ease with which price and competition may be measured.

Case 238/87 Volvo v Erik Veng [1988] ECR 6211; Case 53/87 Consorzio Italiano della Componentistica di Ricambio per Autoveiculi (CICRA) and Maxicar v Régie des Usines Renault [1988] ECR 6039. See, e.g., E. Derclaye, ‘Repair and Recycle between IP Rights, End User License Agreements and Encryption’, in C. Heath & A. Kamperman Sanders (eds), Spares, Repairs and Intellectual Property Rights, 2009, Kluwer Law International, London, 36 ff; Canon KK v Green Cartridge Co [1997] AC 728; [1997] FSR 817; L. Chan Grinvald and O. Tur-Sinai ‘Intellectual Property Law and the Right to Repair’ (2019) 88 Fordham L Rev, 63. Case T-30/89 Hilti v Commission. Case 22/78 Hugin Kassaregister AB and Hugin Cash Registers Ltd v Commission. Case 85/76 Hoffman La Roche [1979] ECR 461. Case 62/86 Akzo Chemie [1991] ECR 461; C-202/07 P France Télécom SA v Commission [2009] ECR I-2369; [2007] CMLR 25. Case 27/76 United Brands 41–45 per cent, the next biggest 16 per cent. Re GEMA (No 71/224/EEC) [1971] CMLR D35; Guidance on the Commission’s enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings [2009] OJ C45/7, 8. 12.2008, para. [93]. OJ C45/7, 8.12.2008, para. [97]. M-O. Mackenrodt, ‘The Political Economy of Intellectual Property Rights and Competition Policy – Report on a Max Planck Conference on Intellectual Property and Competition Law’ (2005) IIC 113. The concentration of market power in the hands of a few players in the copyright industries has been criticised by N.W. Netanel ‘Copyright and “market power” in the marketplace of ideas’, in H. Shelanski and F. Leveque (eds), Antitrust, Patents and Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2005: clearance in the EU of the Sony-Bertelsman merger which he criticises was subsequently reversed: T-464/04 IMPALA [2006] ECR II-2289.

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iii.

Dynamic efficiency: which ‘accounts for the development of new products, with innovation in technology – not price – being the most powerful competitive force’.62

B. Competition by imitation, competition by substitution and copyright 4.17 Drexl,63 citing Ullrich,64 makes a telling distinction between competition by imitation (‘perfect’ competition presumably takes this form, wholly legal in the absence of intellectual property or rules on unfair competition) and competition by substitution. The latter version may chime with Schumpeter’s notion of innovation as creative destruction, whereby a new product or market entrant ousts an earlier one or at least renders it obsolete.65 These forms of competition may be envisaged as occurring on the same geographical and product market as the product which is subject to imitation or substitution. 4.18 Copyright and other IPRs discourage competition by imitation and encourage competition by substitution. In exceptional circumstances, where competition by substitution is not workable, Article 102 may restore competition, and innovation, by allowing imitation notwithstanding copyright. In normal circumstances, the exceptions and limitations to copyright should suffice to maintain a proper balance between imitation and innovation. 4.19 Whether circumstances are ‘normal’ or ‘exceptional’ may depend on the extent of available copyright exceptions and limitations;66 we might expect to find that, in the EU and jurisdictions where exceptions and limitations to copyright are comparatively narrow, the intervention of competition law may be needed in more instances than in jurisdictions such as the USA where wider ‘fair use’ exceptions, including the concept of ‘transformative fair use’,67 are available.68

62 63

64 65

66

67

See, e.g., the scholarship cited at footnotes 38 to 44 of Graef, Rethinking the Essential Facilities Doctrine for the EU Digital Economy (2019), n 42. J. Drexl ‘IMS Health and Trinko – antitrust placebo for consumers instead of sound economics in refusal-to-deal cases’, (2004) IIC 788 at 805, describing this distinction as ‘of the utmost importance as an analytical tool’ in discussing the copying of knowledge-based intangibles. H. Ullrich in I. Ulrich and E-J. Mestmacker (eds), EG-Wettbewerbsrecht, Kommentar, vol. I, Beck, Munich 1997. Schumpeter characterised innovation as taking a variety of forms, not only new products, but also new forms of business organisation and the opening up of new markets: Schumpeter, Business Cycles, McGraw-Hill Book Co, New York, 1939, vol. 1, 72–73, 84–102. On which see T. Dreier ‘Regulating Competition by Way of Copyright Limitations and Exceptions’, Ch 10 in P.L.C. Torremans, Copyright Law: A Handbook of Contemporary Research, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2008. A concept admired in Gowers Review of Intellectual Property (HM Treasury, London, 2006) at 66. It was described in Campbell v Acuff-Rose Music, Inc. 510 US 569, 579 (1994) as use which ‘adds something new, with a further purpose or different character, altering the first [work] with new expression, meaning, or message’. Justice Leval had characterised it thus, at 1111: The use must be productive and must employ the quoted matter in a different manner or for a different purpose from the original. A quotation of copyrighted material that merely repackages or republishes the original is unlikely to pass the test; in Justice Story’s words, it would merely “supersede the objects” of the original. If, on the other hand, the secondary use adds value to the original – if the quoted matter is used as raw material, transformed in the creation of new information, new aesthetics, new insights and understandings – this is the very type of activity that the fair use doctrine intends to protect for the enrichment of society. Transformative uses may include criticizing the quoted work, exposing the character of the original author, proving a fact, or summarizing an idea argued in the original in order to defend or rebut it. They also may include parody, symbolism, aesthetic declarations, and innumerable other uses, quoted in G. Reynolds, ‘Towards a Right to Engage in the Fair Transformative Use of Copyright-Protected Expression’.

68

For arguments that Europe should introduce US-style ‘fair use’ exception to copyright, see, e.g., M. Senftleben ‘The International Three-Step Test: A Model Provision for EC Fair Use Legislation’, (2010) JIPITEC 67. See, also, comments of P.E. Geller ‘A German Approach to Fair Use: Test Cases for TRIPs Criteria for Copyright Limitations?’ (2010) Journal of the Copyright Society of the USA, 57 553–71.

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Authors Guild, Inc v Google, Inc,69 in which the US courts held that mass digitisation of books, for the purpose of enabling searches for terms of interest, could constitute fair and transformative use, can be regarded as a particularly generous application of the fair/transformative use doctrines. The ‘essential facilities’ doctrine seemed more readily used in Europe than in the US,70 after the US Supreme Court in Verizon v Trinko71 limited its application and declined to ‘recognize it or to repudiate it’. However, there has been an apparent lull in its application in the EU, considered further below. Graef has argued for continued application of the essential facilities, perhaps in modified form,72 and it is submitted that this is desirable. The doctrine may apply (exceptionally) to cases which would not be regarded as transformative use in copyright; for example the comprehensive TV guide in Magill might be regarded as mere ‘repackaging or republishing’ of the original material. Conversely, the essential facilities doctrine’s limitation to exceptional circumstances and abuse of dominance means that it would not be available in many situations of ‘transformative use’. It is argued that a combination of copyright exceptions and limitations plus the essential facilities doctrine in exceptional situations may strike an appropriate balance between the interests of authors/copyright owners, the interests of competitors and those of consumers.73

C. Competition by extension? If we take into account potential competition and potential markets, and the varieties of innovation 4.20 posited by Schumpeter, we might add another class of competition, here dubbed ‘competition by extension ’, to Ullrich and Drexl’s competition by imitation and competition by substitution. This third type of competition could take various forms, including: i.

ii.

69 70

71

72 73

74 75

bringing the same or a substitute product into a new geographical market, for example, translating a key medical text into a new language for a country where the copyright owner is not yet active. The Berne Convention recognises that copyright may have to be curtailed in certain circumstances to allow this to occur;74 adapting a work to operate on a new platform, in a new form75 or a new environment as yet unexplored by the copyright holder, or inaccessible to them. An example of the latter might be ‘fan films’, where the ethos of the works is creation by fans rather than by the originator or copyright owner. Many of the ‘essential facilities’ cases involving copyright concern a ‘new product’ for which access or licence is required;

Authors Guild Inc v Google Inc 804 F. 3d 202 (2d Cir. 2015). Principles probably originated in United States v Terminal Railroad Ass'n – 224 US 383 (1912) but subject of much criticism, e.g. P. Areeda ‘Essential facilities: An epithet in need of limiting principles’, (1989) Antitrust LJ, 58, 841. A succinct account of US law as at [1999] is given in C-7/97 Oscar Bronner at [46]–[47]. 540 US 398 (2004), a case on telecoms access; there was already a statutory regime compelling non-discriminatory provision of interconnection services to other carriers and thus antitrust (competition) legislation was not required to provide a remedy. See Drexl, 795; Longdin and Eagles, 134. Cf, B. Frischmann and S. Weber Waller, ‘Revitalizing essential facilities’ (2008) Antitrust LJ, 75(1) 1. Graef, n 42. A concern expressed by Stamatoudi (n 49 at 174) that the CJEU over-emphasises competition law (and free movement rules) at the expense of copyright may be partly by allayed by the judgment in Soulier & Doke v Premier Ministre C-301/15 ECLI:EU:C:2016:878, where the Court struck down a French legislative scheme for non-consensual collective licensing. Torremans has also pointed out that the European legal order tends to privilege competition and free movement over copyright: P. Torremans ‘Individual and Collective Management of Rights: A three-dimensional snapshot by way of concluding remarks’ in R. Leska (ed), Proceedings of ALAI 2019 Congress, Prague (Wolters Kluwer, 2020, in press). Berne Convention for the Protection of Literary and Artistic Works, 1886 and revisions, Art. 8 (Right of Translation); Art. 30(2)(b) and Appendix, Art. II. E.g., in a form suitable for use by a visually impaired citizen, as envisaged by Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired or Otherwise Print Disabled (2013), implemented into EU law by Directive (EU) 2017/1564.

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iii.

iv.

extending a genre into new works where an economically powerful author has declined to do so, e.g. ‘fan fiction’ relating to Harry Potter76 once JK Rowling had announced her intention to write no more novels involving the popular character,77 or; responding to a work of high economic and cultural significance with another work, such as ‘The Wind Done Gone’ in response to ‘Gone With The Wind’.78

The notion of competition by extension will be tested later for its relevance to essential facilities jurisprudence. Where carried out by a powerful undertaking, it may be regarded as ‘conglomerate strategy’ to arrogate new neighbouring (or distant) markets to itself.79

D. Competition in a market versus competition for a market 4.21 This important distinction is made by Graef.80 It is analysed in the context of ‘sustaining innovation’ versus ‘disruptive innovation’, after Christensen.81 The former type of innovation involves minor or major improvement to existing products; it may radically affect the competitive balance, but within a recognisably existing market. ‘Sustaining’ innovation is often generated by the main actors within the market. Conversely, disruptive innovation is often made by new economic actors and creates a new market, initially small if monopolistic, which may ultimately displace the earlier market. Competition law interventions improve competition within a market, rather than encourage the longer-term competition for a market, which is unpredictable. There is a trade-off between the two, so that intervention ‘in’ a market may inhibit competition ‘for’ a new market.82

4. Abuse of dominance A. Varieties of abuse 4.22 Article 102 lists various exemplary forms that abuse of dominance may take. Although consumer welfare is said to be the ultimate goal of EU competition law,83 only indent (b) specifically refers to the consumer. Temple Lang argues that indents (a) and (d) involve harm to consumers ‘more or less clearly’.84 Abuse is often divided into two conceptual categories: exploitative and exclusionary.85 The European Commission gives priority to regulating exclusionary abuses.86 When competitors are expelled from a market by a dominant firm, or prevented from entering the market, then

76 77 78

79 80 81

82 83 84 85

86

See, e.g., http://www.harrypotterfanfiction.com/, which refers to authors of fan fiction receiving royalties from ‘Kindle’ sales through Amazon (accessed 12 June 2013). http://www.guardian.co.uk/books/2010/nov/17/harry-potter-jk-rowling-radcliffe (last accessed 11 May 2020). Suntrust Bank v Houghton Mifflin Co, 252 F.3d 1165 (11th Cir. 2001). Anonymously noted (2002) 115(4) Harvard LR 1193–216; the case subsequently settled before determination of copyright infringement issues, see http://www.rcfp.org/ node/92088; see also, Birnhack, 46. Either by direct market entry or by acquisition of start-up firms, see Graef, n 42. Ibid., 6–12. J.L. Bower and C.M. Christensen, ‘Disruptive Technologies: Catching the Wave’ (1995) Harvard Business Review 73,1 (Jan–Feb), 43; C.M. Christensen, The Innovator’s Dilemma. When New Technologies Cause Great Firms to Fail, Boston, Massachusetts, Harvard Business School Press, 1997; C.M. Christensen and M.E. Raynor, The Innovator’s Solution: Creating and Sustaining Successful Growth, Harvard Business School Press, 2003, pp. 32–4 and footnote 3. See, also P. Ibáñez Colomo ‘Restrictions on Innovation in EU Competition Law’ (2016) Eur L Rev 201; Stamatoudi, n 49, 171–2. See above, n 6. Temple Lang ‘Commonly accepted errors and misunderstandings in European Competition Law’. Whish and Bailey suggest a third category – ‘single market abuses’ where parallel imports are impeded, p 202. However, as regards cloud computing, Sluijs et al. doubt whether EU competition law assists in preventing fragmentation of the internal market: J.P. Sluijs, P. Larouche, W. Sauter, ‘Cloud computing in the EU Policy Sphere: Interoperability, vertical integration and the internal market’ (2012) JIPITEC 12, 22, para. [58]. Communication from the Commission – Guidance on the Commission’s enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings (2009/C 45/02) OJ C 45, 24.2.2009, 7–20, para 7 – exclusionary abuses in their most common forms.

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competition is difficult to sustain. Conversely, when market entry (and exit) by competitors is not hampered, it is difficult for a dominant undertaking to engage in, say, excessively high pricing – competitors will be attracted to the market by the prospect of rich rewards. In Hoffman-La Roche the concept of abuse was characterised as: an objective concept relating to the behaviour of an undertaking in a dominant position which is such as to influence the structure of a market where, as a result of the very presence of an undertaking in question, the degree of competition is weakened and which, through recourse to methods different from those which condition normal competition, has the effect of hindering the maintenance of the degree of competition

The categories of abuse are not exhaustively listed in Article 102. In particular, refusal to supply has 4.23 been held an abuse of dominance and is the form most relevant to the essential facilities doctrine. It is closely related to indent (b), considered below. i.

Unfair pricing, etc, indent (a)

Here one is looking mainly at exploitative abuse – where dominance allows an undertaking to raise 4.24 prices to customers or reduce prices to suppliers. Findings of unfair pricing are comparatively rare, not least because the task of the competition authorities is not to set prices but to protect competitive market mechanisms, which regulate in turn supply and demand via pricing and other features. A case exemplifying unfair prices for licensing (trade marks) is Der Grüne Punkt Duales System v Commission.87 Acceptance of packaging by the undertaking’s recycling depots relied upon the presence of a ‘green dot’ mark on the materials. Packaging manufacturers effectively paid in advance for recycling by taking a licence to apply the mark to appropriate packaging. The system was extremely effective and the undertaking became dominant. It was held that their blanket royalty system, which did not allow for the possibility that the materials would be not be recycled in the undertaking’s depots, was an abuse of dominance, but that it would not be an abuse to make some charge for the benefit of the mark in those cases. An example of exclusionary pricing conduct is predatory pricing, where the dominant firm sets its 4.25 prices below marginal cost, such that smaller competitors cannot compete and are driven from the market.88 The dominant firm can then recoup its outlay by raising prices, although proof of recoupment has not been required in the cases.89 It has been suggested that if an open-source solution or platform achieves dominance, the requirement of free redistribution might operate unfairly to a proprietary competitor or exclude them from participation in a predatory manner.90 Välimäki has pointed out that open-source licensing systems preclude the dominant undertaking charging non-zero prices at a later stage, although charges might be made for complementary products or services.91 ii.

Discrimination, indent (c)

Pricing cases more often fall under indent (c), where differential pricing, such as discounts, rebates 4.26 and the like may constitute abuse, usually exclusionary in nature. In Hilti,92 the undertaking was dominant in the field of nail guns for the construction industry. They used their IPRs also to corner downstream markets – nail cartridges for use in the guns (which were also protected by IP rights) 87 88 89 90

91 92

C-385/07, [2009] ECR I-06155; [2009] CMLR 19. Case 62/86 Akzo Chemie BV v Commission. Tetra Pak II [1992] 4 CMLR 76. S. Sheppard ‘Balancing free with IP: potential competition law issues for open source software’, www. practicallaw.com/ competitionhandbook 2010 vol 1, 1, citing the US case of Wallace v IBM 467 F.3D 1104 (7th Circ, 2006); L Guibault and O. Salamanca ‘Fitting the Bill’, Ch. 16, p 336 of A. Metzger, ed, Free and Open Source Software (FOSS) and other Alternative License Models (Springer, 2016). Välimäki, (available at SSRN: http://ssrn.com/abstract=1261628 or http://dx.doi.org/10.2139/ssrn.1261628). C-53/92P Hilti AG v Commission; T-30/89 Hilti v Commission.

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and the supply and fitting of (otherwise standard) nails into the cartridges. Hilti were found to have committed various forms of abuse on dominance, including unjustified discrimination in the prices charged for licences and discrimination in terms of the speed with which applications for licences were processed. 4.27 Unsurprisingly, in view of its transactional character, Article 102(c) shares identical wording with Article 101(1)(d) which prohibits such conduct in agreements between undertakings. Prohibited conduct under Article 102 can be unilateral but requires dominance. Under Article 101, nonminimal effects on competition and trade are required,93 but there has to be a consensus between two or more persons94 whether by agreement, informal accord or concerted practice. iii.

Tying and bundling, indent (d)

4.28 Again, this form of abuse is transactional in nature and is mentioned as a variety of anticompetitive agreement under Article 101(1). It spans the divide between exploitative and exclusionary forms of abuse. ‘Tying’ is used to describe the situation where an agreement relating to a desired product (e.g., a contract for sale or IP licence) is used to compel the customer to buy another, unnecessary product.95 ‘Bundling’ is similar but is used where the desired product (or licence) can be obtained only as part of a larger bundle, or where the bundle is priced much more favourably than the individual components (where available separately).96 A problem for competition regulators is to distinguish between forms of tying and bundling which are efficient and beneficial in allowing economies of scale or reducing transaction costs, in as blanket licensing or open forms of intellectual property pooling,97 and forms which should be condemned as anticompetitive. Microsoft was fined for bundling Media player with other applications software in licences to original equipment manufacturers who installed the Windows operating systems on PCs.98 Despite arguments that the products were not separate, the CFI upheld a finding that the Windows client PC operating system (albeit constantly evolving), and the various applications to run on Windows, were distinct products and so could be subject to tying and bundling. More recently, a large fine was imposed upon Google by the European Commission for tying,99 Google Inc’s conduct being to insist that Android device manufacturers wishing to install Google ‘Play Store’ must also install the Google’s search app and (latterly) its Chrome web browser.100 iv.

Limiting production, markets or technical development, indent (b), and refusal to supply

4.29 Such conduct is (once again) prohibited under both Article 102 and Article 101(1)(b). Its effect on competition and consumer welfare would seem clear. Forms include the agreement of production quotas and the setting of technical standards. However, the latter are often beneficial or at least

93

94 95 96

97 98 99 100

Volk v Vervaecke [1969] ECR 295; [1969] CMLR 273; Commission notice on agreements of minor importance which do not appreciably restrict competition under Art. 81(1) [2001] OJ C368/13, the so-called ‘de minimis ’ notice; for proposals to revise the notice, see http://ec.europa.eu/competition/consultations/2013_de_minimis_notice/index_ en.htmlde. Bayer v Commission [2000] ECR II-3383. E.g., the supply of consumables tied to a patent licence: T-83/91 Tetra Pak v Commission [1994] ECR II-755, upheld on appeal C-333/94 Tetra Pak v Commission [1996] ECR I-5951. The latter is sometimes called ‘mixed bundling’, as opposed to ‘pure bundling, where the components are not available separately: S.J. Liebowitz and S.E. Margolis, ‘Bundles of joy: The ubiquity and efficiency of bundles in new technology markets’ (2008) Journal of Competition Law and Economics, 5, 1; see, also, M. Walker ‘Bundling: Are US and European views converging?’ (2008) Euro CJ, 4, 275. Commission Guidelines on the application of Article 81 of the EC Treaty to technology transfer agreements (2004/C 101/02) para [148]. T 201/04 Microsoft Corp v Commission of the European Communities [2007] ECR II-3601; [2007] 5 CMLR 11. EUR 4.3bn for tying and other abuses. Commission decision AT.40099 Google Android 18.7.2018, published 20.09.2019.

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benign101 and their anticompetitive effects can be minimised by transparent procedures and the practice of requiring standard-setting participants to license essential intellectual property on ‘Fair, Reasonable And Non-Discriminatory’ (FRAND) terms.102 Where unilateral behaviour distorts or subverts this practice, Article 102 may be pressed into service, as in Rambus, where a participant withdrew from the standards setting process before FRAND commitments were given, and later asserted its essential patents.103 In HuaWei v ZTC,104 the CJEU held that, although breach of a FRAND commitment could be abuse of a dominant position, it would not be so if the holder of a Standard Essential Patent (SEP) applied for an injunction or recall of products after alerting the alleged infringer to the patent and particulars of infringement. And, if the alleged infringer expresses willingness to grant a FRAND licence, offered one.105 Claiming damages or an account of profits for past unauthorised uses was also held not to be an abuse of dominance. Other unilateral conduct, in particular refusals to supply, can have an inhibiting effect on others’ 4.30 ability to maintain or enhance production, and develop markets or technologies. The characterisation of refusal to supply as a form of abuse under Article 102(b)106 can be traced in general to Commercial Solvents,107 where the dominant undertaking refused to re-commence supplies of essential feedstock chemicals through its European subsidiary ICI to a former customer, the complainant. There were other possible input chemicals but the complainant’s factory was not equipped to process them. Non-supply to the complainant would have improved ICI’s position on the downstream market. The standing of new/potential customers to complain of refusal to supply was subsequently confirmed.108 Refusals of supply to existing customers to discourage parallel exports were held to be abusive of dominance in Sol Lelos v GSK.109 In Orange Polska SA v European Commission110 the courts upheld fines imposed by the Commission against Orange for abusing a dominant position in two wholesale telecommunications markets. According to the Commission’s

101

102

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Commission Communication, ‘The role of European standardisation in the framework of European policies and legislation’, COM(2004) 674 final; Commission Notice – Guidelines on the applicability of Article 81 of the EC Treaty to horizontal cooperation agreements, [2001] OJ C3/2, 6.1.2001. This may limit the availability of injunctions against defendants willing to take a licence, though not against the unwilling: Motorola/Google v Apple, Commission, May 2013; Huawei v ZTC C-170/13 EU:C:2015:477. For difficulties associated with FRAND criteria, see T. Hoehn and A. Lewis ‘Interoperability Remedies, FRAND Licensing and Innovation: A Review of Recent Case Law’ (2013) ECLR 101. Rambus Commission decision COMP/38.636, 9.12.2009. The text of the Commission’s decision to accept behavioural commitments to settle the case, along with the concomitant rejection of the complaint on which the case was based, is available at: http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=1_38636. C-170/13 EU:C:2015:477. The Court took a ‘middle way’, captured in para [42]; in assessing the lawfulness of such an action for infringement brought by the proprietor of an SEP against an infringer with which no licensing agreement has been concluded, the Court must strike a balance between maintaining free competition—in respect of which primary law and, in particular, Article 102 TFEU prohibit abuses of a dominant position—and the requirement to safeguard that proprietor’s intellectual-property rights and its right to effective judicial protection, guaranteed by Article 17(2) and Article 47 of the Charter, respectively.

105

106 107

108 109 110

In Unwired v HuaWei [2018] EWCA Civ 2344, it was held that the licence could in principle be global; the English Court did not interpret Huawei v ZTC as ruling that Art. 102 would always preclude claiming an injunction without notice or consultation. Note: an appeal from this decision to the UK Supreme Court was heard in October 2019, judgment is awaited at time of writing; the further appeal concerned mainly the jurisdiction of the English courts to specify a world-wide royalty rate in a FRAND injunction. See https://www.supremecourt.uk/cases/uksc-20180214.html. T 201/04 Microsoft at [643]. Joined Cases 6/73 and 7/73 Istituto Chemioterapico Italiano and Commercial Solvents v Commission [1974] ECR 223; Commercial Solvents v Commission [1974] ECR 223. See, also, Case 27/76 United Brands Company and United Brands Continental BV v Commission [1978] ECR 207, [1978] 1 CMLR 429. E.g. C 7/82 GVL v Commission [1983] ECR 483, [1995] 3 CMLR 645; T 301/04 Clearstream Banking v Commission; Commission Guidance at [84]. C-468/06 Sot Lelos kai Sia EE v GlaxoSmithKline AEVE Farmakeftikon Proionton (formerly Glaxowellcome) [2008] ECR I-07139. Orange Polska SA v European Commission T-486/11 EU:T:2015:1002, affirmed C-123/16P ECLI:EU:C:2018:590.

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findings, the impugned conduct had the aim of protecting Orange’s position in the downstream retail market, by proposing unreasonable terms for broadband internet access and unbundled access to the local loop, by stalling the negotiation of agreements for access and by refusing to provide indispensable information.

B. Development of refusal to supply and the parameters of ‘essential facility’ cases 4.31 Refusal to supply in IP cases was raised in the sister cases of CICRA v Renault 111 and Volvo v Veng.112 In the latter case, Veng argued that, by suing for design infringement against imports of unauthorised spare parts and refusing to license ‘pattern spares’, Volvo were abusing Article 86 EEC (now Art. 102 TFEU). The argument was rejected; authorised Volvo spares were readily available. However, it was recognised that a refusal to licence might be abusive in exceptional circumstances: it must be emphasised that the right of the proprietor of a protected design to prevent third parties from manufacturing and selling or importing, without its consent, products incorporating the design constitutes the very subject matter of his exclusive right – it follows that an obligation imposed upon the proprietor of a protected design to grant to third parties, even in return for reasonable royalty, a licence … would lead to the proprietor thereof being deprived of the substance of his exclusive right … it must however be noted that the exercise of an exclusive right by the proprietor of a registered design in respect of car body panels may be prohibited by Art 102 if it involves, on the part of the undertaking holding a dominant position, certain abusive conduct such as the arbitrary refusal to supply spare parts to independent repairers, the fixing of prices for spare parts at an unfair level, or a decision to no longer produce spare parts for a particular model even though many cars of that model are still in circulation, provided that such conduct is liable to affect trade between member states. (emphasis added)

Thus the court envisaged that in such exceptional circumstances (not present in Volvo’s case) a right holder could be obliged to license. This line of reasoning was continued in Magill,113 which may be regarded as the first ‘essential facilities’ case involving IP. 4.32 Before turning to analyse Magill and its successors, we may note that there is a long line of non-IP cases where a request for access to an essential facility has been formulated under the banner of Article 102.114 Three particular ‘brakes’ may limit such application of Article 102. First, the Court and the Commission have repeatedly stressed the general principle that, ‘generally speaking, any undertaking, whether dominant or not, should have the right to choose its trading partners and to dispose freely of its property’.115 In Bronner, AG Jacobs goes on to stress that encouraging free-riding by ordering access to essential facilities might be damaging to competition in the longer term, by discouraging investment. This sentiment was echoed by the UK Office of Fair Trading in EI du Pont de Nemours & Co/Op Graphics (Holography) Ltd,116 and by the European Commission in its Guidelines,117 but may require specific proof.118

111 112 113 114 115 116

Case 53/87 CICRA Case 238/87 Volvo AB v Erik Veng (UK) Ltd. ‘Magill ’ (C 241/91P). See para 4.02 above. Commission Guidance on priorities [75]; A-G Jacobs in Bronner at [AG 56]. OFT decision CA98/07/2003, available at www.oft.gov.uk/shared_oft/ca98_public_register/decisions/dupont.pdf and noted by Emma Nicholson at [2004] ECLR N10 at [29]: The effect of treating every new product which, at the time of its discovery, had unique properties as an essential facility (if this product was a necessary input into a downstream market), would be to permit an excessive degree of interference with the freedom of undertakings to choose their own trading partners. As stated above, competition law should have this effect only in exceptional circumstances.

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At [75] of Commission Guidance notice – Refusal to supply and margin squeeze, 3 Dec 2008, OJ 2009 C 45/7 Temple Lang, St Gallen, argues that the notice does not list all the conditions and therefore suggests that a duty to contract ‘arises more often than is correct’ and argues that the ‘additional abusive conduct’ required by ECJ in Volvo and Magill is of general application. T 201/04 Microsoft at [1144] refers to supporting a plea of justification by ‘arguments and evidence ’.

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Secondly, many if not all ‘essential facilities’ cases have involved a double-market structure – the 4.33 dominant undertaking controls an ‘upstream’ facility to which the complainant requires access in order to compete with the undertaking on a downstream market.119 The Commission’s Guidelines on Priorities limits itself to such situations when discussing refusal to supply.120 Temple Lang argues that this two-market feature must always be present for an essential facilities case to be made out.121 Liu, citing the Wittem group’s 2010 European Copyright Code, also refers to the two-market model, where (i) (ii)

the use is indispensable to compete on a derivative market; the owner of the copyright in the work has refused to license the use on reasonable terms, leading to the elimination of competition in the relevant market; and (iii) the use does not unreasonably prejudice the legitimate interests of the owner of the copyright in the work (Art. 5.4).122

From IMS it appears sufficient that there are interconnected stages of production. In Compassdata 4.34 the requirement for two markets was questioned but not answered by the Court of Justice.123 In the UK national case of Intel Corp v Via Technologies Inc, a requirement for upstream and downstream markets was rejected, ‘The only test of general application was that stated in the Magill case, that the exercise of an exclusive right by the proprietor might, in exceptional circumstances, involve abusive conduct.’124 However, the upstream/downstream debate arguably does not limit the essential facilities doctrine in copyright refusal-to-license cases. This is because an upstream market may readily be identified – the market for licences. This approach has been adopted in the European Commission’s Technology transfer block exemption regulations.125 Microsoft at [335] cites IMS at [44] in holding that it is ‘sufficient that a potential market or even a hypothetical market could be identified’. A third, more effective brake is said to have been applied in Bronner,126 where the ECJ held that the 4.35 complainant would have to meet four criteria to claim access to a dominant firm’s newspaper distribution network:

119

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126

Usually the two markets are in a ‘vertical’ relationship, occasionally horizontal’: J. Temple Lang, ‘Defining legitimate competition: Companies’ duties to supply competitors, and access to essential facilities’ in B.E. Hawk (ed.), 1994 Fordham Corporate Law Institute (New York: FCLS, 1995), 300–302. At [76]; C-418/01 IMS Health GmbH & Co OHG v NDC Health GmbH & Co KG [2004] ECR I-5039; [2004] 4 CMLR 28 at [42] and [45] appears to require two distinct, interconnected, markets. J. Temple Lang ‘How can the problems of exclusionary abuses under Article 102 TFEU be resolved?’ [2012] EL Rev 136 at 148–50; Temple Lang cites Case T 504/93 Tiercé Ladbroke v Commission [1997] ECR II-923 as establishing that there no duty to supply input for market on which the dominant undertaking is not present or on which it has no market power; however, the Court was prepared to assume that this might not be the case, finding additional reasons to reject Ladbroke’s contentions. An appeal from this decision was lodged, as Case C-300/97P, but removed from the register in 11 Feb 1999: P. Larouche Competition Law and Regulation in European Telecommunications, Hart, Oxford, 2000, 188, n 320. See, also T 32/93 Ladbroke Racing v Commission of the European Communities [1994] ECR II-1015. K-C. Liu, ‘The need and justification for a general competition-oriented compulsory licensing regime’ (2012) IIC 679: 692–3. Parallels with compulsory licensing (where allowed, e.g. for follow-on innovation) are also mentioned in Commission’s Notice on priorities at [89]. As question 3 to the Court: ‘Is Article 102 TFEU to be interpreted as meaning that the principles laid down in the judgments in RTE and ITP (Magill) and in IMS Health 9 (“essential facilities doctrine”) are also to be applied if there is no “upstream market” because the protected data are collected and stored in a database (business undertakings register) in the course of a public-authority activity?’: Case 138/11 Compass-Datenbank. [2002] EWCA 1905; [2003] FSR 33 CA, citing IMS decisions to 2002 (see below at paras 4.50–4.54). Commission Regulation (EC) No. 772/2004 of 27 April 2004 on the application of Article 81 (3) of the Treaty to categories of technology transfer agreements, Art. 3(3); Reg 772/2004, which applies to ‘industrial’ copyright in computer programmes, is due to expire on 30 April 2014. For proposed new regulation and Guidelines, see http://ec.europa.eu/competition/consultations/2013_technology_transfer/index_en.html. Bronner (C-7/97).

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+ + + +

Refusal must be likely to eliminate all competition from the undertaking requesting access Refusal must be incapable of objective justification Access must be indispensable to carrying on the requester’s business There must be no actual or potential substitute.

4.36 Indispensability means that no alternative facility exists and there are technical, legal, or economic obstacles that make it impossible or unreasonable to create one. Did this raise the bar from earlier cases? It has been suggested that a number of earlier refusal-to-supply cases would be decided differently, post-Bronner.127 However, indispensability of the licence to reproduce copyright programme listings was already a key feature of Magill.128 Graef argues129 that, in Google Shopping,130 the Commission avoided applying the stricter Bronner criteria, by characterising Google’s conduct as discrimination – favouring its own comparison shopping service over others’ – rather than one of refusing access to the prominent area of its search results listings. 4.37 The essential facilities doctrine may have been applied generously in earlier cases; Kallaugher and Weitbrecht have regarded the Commission’s decision in ENI 131 as appearing ‘to favour a very expansive interpretation of TFEU Art.102, according to which the obligations of an owner of essential facilities under certain circumstances are not limited to the granting of access to existing facilities but also require the dominant company to enlarge the essential infrastructure facilities’.132 4.38 The Commission’s guidance on priorities states133 that actual refusal to supply is not required; there could be ‘constructive’ refusal to supply, constituted for example by undue delay or unreasonable pricing.

5. A ‘defence’ of objective justification? 4.39 Article 102 contains no ‘let-out clause’ similar to Article 101(3). In a number of cases, including Bronner, the presence or absence of objective justification has been crucial. Objective justification is sometimes seen as a defence to Article 102, although it is probably better considered as part of the abuse enquiry. The Commission’s approach is summarised in its Guidance on enforcement priorities, under the heading ‘Objective necessity and efficiencies’.134 To displace a finding of abuse, a dominant firm will have to establish that its conduct is objectively necessary, or produces ‘substantial efficiencies which outweigh any anticompetitive effects on consumers’. Efficiencies which produce no net harm to consumers may also suffice if other criteria are met. 4.40 ‘Necessity’ may include cases where it is impossible to comply with the request due, for example, to lack of spare capacity (but see ENI), congestion of facilities, weighty issues of health of passengers or navigational safety.135 However, it may not be sufficient to plead that allowing access will

127 128 129 130 131 132 133 134 135

E.g., S.J. Evrard ‘Essential facilities in the EU: Bronner and beyond’, (2004) Colombia J Eur Law 10, 1, suggests that Commercial Solvents, United Brands and possibly Magill would have had different outcomes. Magill, [53]. Graef n 42, section 4.1, See, also, M.K. Kolasinski ‘Google Shopping Decision against the Background of the EU and US case law’ (2020) ECLR 234. Re Google Search (Shopping) Case AT.39740 [2018] 4 CMLR 12. An appeal to the General Court, T-612/17 Google v Commission, is ‘in progress’; the hearing took place in mid-February 2020, ruling still awaited at the time of writing. Commission Decision of September 29, 2010 (COMP/39.315 – ENI) [2010] OJ C352/8. J. Kallaugher and A. Weitbrecht, ‘Developments under Articles 101 and 102 TFEU in 2010’, (2011) ECLR 333. Commission guidance, 79. At [28]–[31], based on United Brands, Télémarketing; Hilti; Tetra Pak II (all referred to above) and C-95/04 British Airways v Commission [2007] ECR I-2331 at [69] and [86], Sea Containers v Stena Link n 10.

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undermine property rights, tangible or intangible.136 ‘Efficiencies’ may include technical improvements and reduction of costs of production or distribution. In Microsoft [at 680] it was held that ‘objective justification’ required the dominant firm to prove 4.41 that there would be more than theoretical ‘negative impact on its incentives to innovate’ which would outweigh the factors pointing to abuse. An argument which has not yet arisen in copyright ‘essential facilities’ cases is the issue of moral, as 4.42 opposed to economic, rights. Even if there is an imperative to use economic rights under copyright, this should not work to the detriment of authors’ moral rights, in the protection of which there may be a distinct public interest.137 Burke, citing Vaver, Locke, Kant and others, has argued that moral rights can be embodied in the welfare optimisation exercise of competition regulation.138 A useful copyright analogy might be with parody exceptions.139 From a survey of parody, Erickson, Kretschmer and Mendis argue that the scope for reputational harm is limited, but they used as a criterion for excluding parodies from empirical samples the principle that, ‘Parody must not harm the personality rights of the creator of the original work’.140

II. MAGILL AND BEYOND – ESSENTIAL FACILITY CASES RELATING TO COPYRIGHT Here we are looking at a situation where an undertaking enjoys a dominant position and owns 4.43 relevant copyright or related rights. The complainant’s allegation of abuse of dominance is either used as a sword, to gain access to the rights, or as a shield, arguing that the rights should not be exercised in infringement proceedings. In each case there is citation of the principles enunciated in the earlier cases, although in Microsoft one may see a suggestion of a broader application of Article 102.

1. Magill Three broadcasters, which were active at the time, transmitted programmes receivable in Ireland: 4.44 British Broadcasting Corporation (BBC), Independent Television (ITV) and Radio Telefis Eireann (RTE). The broadcasting undertakings also produced and sold comprehensive programme listings for viewers (e.g., the BBC’s Radio Times, which included TV and radio listings). The programme listings had been held the subject of copyright in ITV Publications v Time Out.141 Thus, the broadcasting undertakings were active in an upstream broadcasting market (of which the copyright programme listings were a by-product) and a downstream market (for programme listing

136

137 138

139 140

141

E.g., Flughafen Frankfurt [1998] OJ L72/30; 4 CMLR 779; Magill, where the distinction was made between existence of intellectual property, preserved by what is now Art. 345 TFEU, and its exercise; Purple Parking Ltd v Heathrow Airport Ltd [2011] EWHC 987 (Ch) where a distinction was made between ‘the real fruits of ownership’ and ancillary uses of the property. Vaver argues that ‘truth in marketing’ is served by moral rights. A. Burke, ‘On the relationship between copyright and antitrust law: Economic versus moral rights’, University of Warwick Centre for Small- and Medium-sized Enterprises, Working Paper No 74, October 2002, available at http://www2.warwick.ac.uk/fac/soc/wbs/research/ei/research/working_papers, from p 8. Sainsbury (available at SSRN: http://ssrn.com/abstract=1980392). K. Erickson, M. Kretschmer and D. Mendis, ‘Copyright and the economic effects of parody: An empirical study of music videos on the YouTube platform and an assessment of the regulatory options – Parody and pastiche’, Study III. January 2013 (UK IPO) available at www.ipo.gov.uk/ipresearch-parody-report3-150313.pdf, citing Spence, Bently and Jacob. [1984] FSR 84, if the European Court was sceptical of this, it did not actually say so. The effects of the Time Out case were later reversed by legislative amendment in the UK.

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publications) in which Magill wished to compete. The broadcasters licensed only partial reproduction of the programme listings – comprehensive daily or weekend schedules to newspapers; partial schedules for weekly publications like Time Out. 4.45 Magill wished to publish weekly comprehensive listings covering all three broadcasters’ programmes. The Commission held that each broadcaster enjoyed a dominant position, that refusal to licence copyright to allow Magill to publish on the downstream market was an abuse of dominance and that the broadcasters should licence Magill. On appeal to the European Court of Justice (by this time not involving the BBC), the Commission’s decision was upheld. The ECJ ruled that in exceptional circumstances, present here, refusal to licence was an abuse of dominance, which could be remedied by a behavioural order. 4.46 What were the exceptional circumstances in Magill? In the light of comment in Bronner, these may be characterised as follows: + copyright licences were indispensable to Magill; + refusal to licence prevented the appearance of a new product, for which there was a potential consumer demand; + which the appellants did not offer; + thereby keeping for themselves the downstream market for comprehensive TV guides (and with which Magill’s new format would have competed). 4.47 Did Magill wish to compete by imitation, substitution, or extension? Certainly there was a wish to imitate the contents of the broadcasters’ guides, but in a way that enabled consumers to compare programmes across available channels without buying three separate guides. The Magill format was said to be a new product, although perhaps it was not so very new. It is submitted that this situation is better regarded as competition by extension, to a new format, than as competition by substitution. Therefore the other elements, especially the broadcasters arrogating a downstream market for themselves, are particularly important in constituting circumstances as ‘exceptional’ and the refusal to license abusive. 4.48 RTE submitted that the requested remedy would undermine its intellectual property, and thus contravene what is now Article 345 TFEU. However, the ECJ distinguished between the existence of copyright, which was governed by national law and remained intact, and its exercise, which was subject to competition law.142 4.49 Do the Magill criteria ‘read onto’ the situations postulated in Volvo – a dominant firm refusing to license while also arbitrarily refusing to supply spares to independent repairers, or setting unfair prices for their own spares, or maintaining adequate supplies of spares for older models of car? In Volvo the dominant firm was active on two markets, the upstream market for cars and the downstream market for spare parts, in which its design rights effectively conferred a monopoly on compatible spares. A licence would be legally indispensable to pattern spares’ manufacturers. By contrast with Magill, however, refusal to license in the postulated circumstances would not prevent the emergence of a new product, but rather maintain the presence of an old product on the market where there was unmet demand. Thus a licence would extend the temporal availability of spares or the ability of repairers to compete with Volvo.

142

R. Greaves, ‘The Herchel Smith Lecture 1998: Article 86 of the EC Treaty and Intellectual Property Rights’, (1998) EIPR 379. This distinction has been maintained, see, e.g., Re cross-border access to pay-TV [2019] 4 CMLR 45.

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2. Tiercé Ladbroke The complainant ran betting shops in Belgium and wished to screen live footage of French races in 4.50 their shops. The exclusive producers of the French racing footage had licensed such screening in Germany, but not in Belgium, where they refused to license Ladbroke. The Commission rejected the complaint of abuse of dominance and this decision was upheld by the Court of First Instance.143 In rejecting abuse, first it was observed that the owners of televisual copyrights were not present on the betting market. However, if that did not matter, there were other lacunae in Ladbroke’s case. The audio and visual material was not essential to operate betting shops, so refusal did not prevent Ladbroke from operating on the betting market. Nor did refusal prevent the emergence of a new product for which there was specific, constant and regular potential demand on the part of consumers. On this last point, it may be observed that the emergence of a hybrid service was involved – betting with live coverage of racing events – which might have made the main service more satisfactory for consumers, in much the same way that Magill’s TV guide would have made the process of choosing television programmes more satisfactory for consumers. Arguably Ladbroke were seeking to extend the combined service from Germany into Belgium.

3. IMS IMS’s business was in tracking the sales of pharmaceutical and healthcare products. With input 4.51 from industry and using public-domain criteria such as ‘the boundaries of municipalities, postcodes, population density, transport connections and the geographical distribution of pharmacies and doctors’ surgeries’,144 it devised a copyright ‘brick structure’ for the analysis of data. This was marketed but also given out free to doctors and pharmacists. The brick structure became the industry standard. Competitors tried unsuccessfully to develop alternatives. They complained of abuse of dominance to the European Commission, who made an interim order that IMS license their ‘1860 brick’ structure to all undertakings in the market for the provision of German regional sales data.145 IMS applied to the Court of First Instance for annulment of this order and the CFI President granted a stay of the decision 2002/165/EC, pending substantive determination.146 The decision to stay was upheld by the Court of Justice.147 In the meantime the German court had referred questions on the issue from national proceedings for copyright infringement against NDC Health148 and in due course the Commission withdrew the interim order and closed the administrative proceedings. The Court of Justice149 cited Magill/Bronner and characterised the exceptional circumstances of 4.52 Magill as: + refusal of a product, TV schedule information [and actually of course a copyright licence], the supply of which was indispensable for carrying on Magill’s business [i.e., refusal of an essential facility] + which refusal prevented the emergence of a new product for which there was a potential consumer demand [first condition]

143 144 145 146 147 148 149

T-504/93Tiercé Ladbroke v. Commission [1998] appeal lodged as Case C-300/97 P but removed from the register in 11 Feb 1999, see Larouche 188, n 320. C-418/01 IMS Health GmbH & Co OHG v NDC Health GmbH & Co KG [2004] 4 CMLR 28, [3]–[8]. Commission decision 2002/165/EC in Case COMP D3/38.044 – NDC Health v IMS Health (Interim measures) 2002 OJ L 59/18. T-184/01 R IMS Health Inc v Commission of the European Communities (No 1) [2001] ECR II-2349; [2002] 4 CMLR 1 (stay of interim injunction). C-481/01 P(R) NDC Health v IMS Health and Commission [2002] ECR I-3401. C-418/01 IMS Health. Ibid., [37].

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+ unjustified by objective considerations, [second condition], and + likely to exclude all competition in the secondary market [third condition] the three conditions being cumulative.150 These conditions formed the basis of the ruling in IMS. 4.53 As regards the requirement of an upstream facility indispensable for a downstream activity, the ECJ purports to agree with the Advocate General that a potential or hypothetical market would satisfy the Magill/Bronner tests – it would be sufficient to identify two different but interconnected stages of production, the first indispensable for the second. This was for the referring court to carry out.151 Temple Lang152 has argued that the ECJ’s reference to ‘potential market’ in IMS without specific reference to the Advocate General’s explanation has led to error – the supposition that the essential facilities doctrine can be applied where the dominant firm is not vertically integrated. This is an attractive argument but the presence of copyright and other IP makes the identification of two markets (actual or potential) rather straightforward. The case for requiring vertical integration is much stronger for some forms of abuse such as margin squeeze.153 4.54 As regards a new product, again it was for referring court to assess that the requester did not: intend to limit itself essentially to duplicating the goods or services already offered on the secondary market by the owner of the intellectual property right, but intends to produce new goods or services not offered by the owner of the right and for which there is a potential consumer demand.154

This appears to pay lip service to the ‘new product’ requirement while suggesting that development of competition in the secondary market, with a variety of services offered, may be enough. Again, this fits the notion of extension, rather than substitution. The court also stated that the input of others into the development of the structure was to be taken into account by the referring court, but gave no guidance as to how. 4.55 As regards the third condition, it was restated in terms of reserving the secondary market to the dominant firm by eliminating all competition on that market. This latter point, as it appeared in the earlier IMS judgments was read in Intel at [49] as a summary of Magill and Bronner, not as imposing a requirement that all competition be eliminated but only competition from the requester. However, it is repeated in the operative part of the ECJ’s substantive ruling in IMS.

4. Microsoft 4.56 In Microsoft, two forms of abuse were complained of: + the bundling together of applications software licensed to PC manufacturers to install along with the ‘Windows’ operating system, the de facto standard at the time + refusal to supply the information and code necessary for competing firms to create applications compatible with Windows. 4.57 The Commission made findings of dominance and abuse in both forms and to remedy the second form of abuse ordered Microsoft to supply interoperability information to all competitors. It was significant that, in the past, Microsoft had in fact made code for interoperability available to

150 151 152 153 154

Ibid., [38]. Ibid., [44]–[45], referring to AG56–AG59. Temple Lang, St Gallen, 23. E.g., C-52/09 Konkurrensverket v TeliaSonera Sverige AB [2011] ECR I-00527. Temple Lang, St Gallen, [49].

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competitors and furthermore that Article 6 of Software Directive 91/250/EEC allowed de-compilation for the purposes of interoperability.155 The evidence on which the Commission based its decision showed that the refusal had hindered 4.58 development of an alternative ‘work group server’ preferred by users, so the ‘new product’ requirement was met in principle, but [it is submitted] undermined in practice by the generality of the order. Microsoft appealed and the Court of First Instance upheld the substantive findings, allowing the 4.59 appeal in relation to detailed administration of the remedy, basing its ruling on a restatement of Magill/Bronner/IMS. Somewhat ominously for copyright owners, the ECJ noted at [334] that the new product 4.60 requirement [first condition] is found only in intellectual property cases. At [643] and [647], the Court of Justice reverts to the general wording of Article 102, with prevention of a new product as merely an example of ‘limiting production to prejudice of consumers’ under indent (b). The Court states that a new product ‘cannot be the only parameter’. At [646] the Court discusses prevention of development of the secondary market and at [664] the prejudice to consumers from impairment of an effective competitive structure. Microsoft’s contention that its refusals were objectively justified [second condition] were rejected.

4.61

As regards to the third condition, elimination of ‘all competition’, the earlier case law is 4.62 characterised in at [332] as requiring only the exclusion of ‘any effective competition’. The Court furthermore confirms at [559] that there is no need to show dominance on the secondary market. This form of the third condition thus shows that Article 102 and orders to license may be used to preserve effective competition (as indeed was foreshadowed in Volvo) and forestall the acquisition of dominance on the downstream market. It is submitted that Microsoft not only supports competition by substitution, but also competition by 4.63 extension, for example into Open Source formats compatible with Windows.

III. SOME QUERIES AND OBSERVATIONS 1. Nature of ‘essential facility’ or ‘indispensable input’ in copyright cases The decisions discussed above show that ‘indispensability’ may be technical (negotiated or de facto 4.64 standards – IMS, Microsoft), economic (Commercial Solvents) or legal (Telemarketing). It is a given that the essential facilities doctrine always requires an economic context to trigger it under the operation of competition law. But can an economically successful copyright-protected work be culturally essential as opposed to, say, technically essential? The requirement for consumer demand for a downstream/facilitated product, actual or potential is 4.65 not inconsistent with that demand being cultural, rather than economic. Potential demand may need to be ‘specific, constant and regular’ to use the formulation of Tiercé Ladbroke. It is submitted that the hunger of fans for further Harry Potter stories may be specific, constant and regular. Do Volvo and Microsoft support a proposition that the owners of copyright in the ‘Harry Potter’ series may need to license, or at least refrain from suing, the creators of respectable ‘fan fiction’, in order to escape the prohibition of Article 102? This depends critically upon whether those copyright owners

155

See Marie-Christine Janssens, Chapter 5 at 5.147.

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are dominant on a relevant market. Although the market for fiction in general is wide open, for exceptional works there may be no substitutes and therefore a narrow market definition is possible. As stated for example in France Télécom,156 the Court of Justice has held that an undertaking which holds a dominant position has a special responsibility to ensure effective and undistorted competition within the internal market. This is a price of success. 4.66 Is ‘fan fiction’ a new product? It is submitted that after Microsoft this ‘condition’ is easily met and would be met by ‘fan fiction’. 4.67 Would this utterly undermine copyright? It is submitted that application of the ‘essential facilities’ doctrine in exceptional cases may make no greater inroads on the rights of authors than a general doctrine of ‘transformative use’, and may be more amenable to the protection of moral rights, as justification for refusals to license or tolerate in particular cases. The fan fiction websites seek to set limits on the content of the stories they encourage. It would be legitimate to distinguish between beneficial or neutral extensions of competition and damaging extensions; the three-step test could provide a further framework for distinguishing between them. This is closely connected with the next issue.

2. Nature of the remedy? 4.68 If access to a work as an ‘essential facility’ is granted to one requester under Article 102b, must equivalent access be granted to second and subsequent requesters on a non-discriminatory basis, perhaps even the same terms, given Article 102c? John Temple Lang has argued, in the context of patents, that the conditions must be strictly considered in each case, the requirement of consumer harm under indent (b) including the longer term consumer harm of preventing a dominant firm and its licensees from developing their rights.157 The ‘Wind Done Gone’ would be an example where the first ‘new product’ provides an important benefit to readers but ‘Gone with the Wind’ or indeed ‘The Wind Done Gone’ need not be further licensed.

3. What about interim measures? 4.69 Temple Lang has commented that the Commission is reluctant to grant interim remedies in essential facilities cases. Sealink/Holyhead and IMS may be the exceptions that prove the rule. It is not just the Commission, however, which can grant interim remedies. There are National Competition Authorities and safeguards against duplication and inconsistent decisions under Regulation 1/2003. The Commission is encouraging ‘private enforcement’ of competition law through the courts of EU Member States. At the moment the main focus appears to be on damages, but there is no reason why interim remedies should not be granted, subject to the rules of private international law operative in the EU.158

156 157 158

C-202/07 P France Télécom, [105]. Temple Lang, St Gallen. On which, see P.L.C. Torremans’ Ch. 24 in this volume ‘Intellectual Property and the EU rules on Private International Law: match or mismatch?’ In Unlockd Ltd v Google Ireland Ltd [2018] EWHC 1363 (Ch), the claimants alleged that Google had abused a dominant position by refusing or suspending access to services required by their app. They were allowed to serve proceedings out of the jurisdiction providing their allegations were limited to such acts in the EU. The claim was transferred to the Competition Appeal Tribunal but was withdrawn after the claimant companies went into administration: [2019] CAT 17.

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4. Essential facilities and WTO TRIPS Does the operation of the essential facilities doctrine in relation to copyright comply with the EU’s 4.70 obligations under the WTO TRIPs agreement? The EU is a member of the WTO, along with EU Member States.159 By Article 40 of TRIPs: Members agree that some licensing practices or conditions pertaining to intellectual property rights which restrain competition may have adverse effects on trade and may impede the transfer and dissemination of technology.

Article 40 goes on to indicate that members may legislate to control such practices. But does Article 4.71 40(1) extend to refusals to license? The references to technology transfer and dissemination suggest this may be the case. Furthermore, Article 40 may be seen as a specific example of the principles set out in Article 8(2), which is broad enough to encapsulate abus de droit and competition law controls on the exercise of IP: Appropriate measures, provided they are consistent with the provisions of this agreement may be needed to prevent the abuse of intellectual property rights by right-holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology. (emphasis added)

Since Article 102 TFEU is premised on an effect on interstate trade, the latter part is satisfied by its 4.72 application. Nguyen160 asserts that Article 8(2) ‘does not apply to other potentially anti-competitive arrangements whose primary object does not directly relate to IPRs, such as mergers and acquisitions and joint ventures’, presumably referring to concentrative joint ventures. One can imagine a cooperative joint venture with licensing provisions which would fall within Article 40 TRIPs, and possibly even a concentration, such as that in IMPALA. TRIPS Article 31(k) removes many of the conditions required for compulsory licensing where 4.73 required to ‘remedy a practice determined after judicial or administrative process to be anticompetitive’. This reinforces the view that obliging undertakings to license copyright in exceptional cases under Article 102 is ‘consistent with the provisions’ of TRIPs.161 In Microsoft v Commission,162 Microsoft argued that the Commission’s order for it to license 4.74 ‘communication protocol specifications’ (enabling interoperability with Windows) to its competitors was in contravention of Article 13 TRIPS’s three-step test for copyright limitations and exceptions. It argued, insofar as TRIPs was not directly applicable in EU law, that Commission v Germany163 required that Article 82 be interpreted in a manner consistent with TRIPs. The Court of First Instance (as it then was) rejected Microsoft’s submission that TRIPS was relevant,164 stating that by contending for ‘consistent interpretation’, Microsoft was effectively trying to rely directly on TRIPs. The Court seems to have positioned the TRIPS Agreement above secondary EU legislation

159 160

161 162 163 164

See http://www.wto.org/english/thewto_e/whatis_e/tif_e/org6_e.htm. T.T. Nguyen, ‘Competition rules in the TRIPS Agreement – the CFI’s ruling in Microsoft v Commission and implications for developing countries’, [2008] IIC 558, 559, n 6, citing H. Ullrich, ‘Expansionist intellectual property protection and reductionist competition rules: A TRIPS perspective’, in K.E. Maskus and J.H. Reichman (eds), International Public Goods and Transfer of Technology under a Globalized Intellectual Property Regime, Cambridge University Press, Cambridge, 2005, 730–1; P. Roffe, ‘Control of anti-competitive practices in contractual licences under the TRIPS Agreement’, in C.M. Correa and A.A. Yusuf (eds), Intellectual Property and International Trade: The TRIPS Agreement, Kluwer Law International, London, 1998, 279–80. See, also, the August 2013 report on refusals to license prepared by the WIPO Secretariat ‘Refusals to License IP Rights – a Comparative Note on Possible Approaches’, para [25]. T-201/04 [2007] ECR II 03601, 3652, 3857. C-61/94 Commission v Germany [1996] ECR I-3989 at [52]. T-201/04, [796]–[803].

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but below the EU Treaty in its conceptual hierarchy of norms.165 Thus in Microsoft the CFI did not consider the substantive arguments under TRIPs Articles 13 and 31(k), although it went on to cite TRIPS Article 40(2) as supporting its view that Microsoft’s TRIPS arguments were unfounded [1192]. 4.75 Subramanian takes the analysis of the Microsoft arguments further. On her analysis, the Microsoft decision complies with the first two steps of the three-step test, but arguably not the third. However, she argues, as long as the Commission engaged in weighing the rights of IP owners with public welfare, Article 13 was not infringed. She comments cogently on the position of TRIPS in the EU legal order. It must be noted that since the decision in Microsoft, the Court of Justice has ruled that the provisions of TRIPS, as regards matters within the EU’s competence ‘are applicable in the legal order of the European Union’, (along with the WIPO treaties).166 However the court in SCF went on to state that individuals could not rely directly on TRIPs.

5. Where has the essential facilities doctrine gone? 4.76 It is notable that no significant new cases in the field of copyright have arisen since the first edition of this volume, although Article 102 has been applied in the context of other IP rights, for example, standard-essential patents,167 payments to generic pharmaceutical manufacturers to delay introduction of off-patent medicines168 and misguided applications for Supplementary Protection Certificates.169 Have new competition concerns in copyright been met in other ways? Or has the doctrine been overtaken by other legal developments? 4.77 Several potential ‘bottleneck’ situations that might have called for application of the doctrine have been ameliorated through other means. The need to make non-infringing use of copyright text and other protected data in ‘big data’ research projects, Text and Data Mining or ‘TDM’, is being met across the EU by new exceptions and limitations to copyright. These were introduced by the Digital Single Market (‘DSM’) Directive,170 but are limited to works for which there is lawful access. The DSM Directive likewise makes provision for the non-commercial digitisation of out-of-commerce items in the permanent collections of museums and galleries171 and Article 12 allows Extended (non-consensual) Collective Licensing where voluntary transacting is ‘onerous or impracticable to a degree that would make the required licensing transaction unlikely’.172

165

166 167 168 169

170

171 172

S. Subramanian, ‘EU obligation to the TRIPs Agreement: EU Microsoft decision’, [2010] EJIL 997, 1017; see also R.A. Wessel and S. Blockmans (eds), Between Autonomy and Dependence: The EU Legal Order Under the Influence of International Organisations, The Hague: TMC Asser Press/Springer, 2013, Chapter 1, ‘Introduction’, 2. C-135/10 Società Consortile Fonografici (SCF) v Marco Del Corso, 15 March 2012, para. [1] of operative part of judgment, along with WIPO treaties but not Rome phonogram and broadcast convention. Huawei v ZTC C-170/13. Generics (UK) Ltd v Competition and Markets Authority C-307/18 EU:C:2020:52 and B Wardhaugh’s note thereon at [2020] ECLR N39. AstraZeneca v Commission C-45710 P. Fines also related to abuse of dominance by withdrawal of marketing authorisations for the originator’s medicine, which made it difficult for generic companies to obtain authorisation for theirs. Directive (EU) 2019/790, Arts 3 & 4, in force 7 June 2019, to be implemented within 24 months i.e., by 7 June 2021. See also wider efforts under Regulation 2019/1150 on promoting fairness and transparency for business users of online intermediation services, discussed by B. Batchelor and C. Janssens ‘Big data: understanding and analysing its competitive effects’ [2020] ECLR 217-224. Art. 8 Art 12. Previously, in Soulier & Doke v Premier Ministre C-301/15, the CJEU had found an opt-out French extended collective licensing scheme for out-of-commerce works to be incompatible with the authors’ rights.

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NOTES

As noted above, ideally one would see specific limitations to the copyright holder’s exclusive rights 4.78 supplemented by an essential facilities mechanism for exceptional cases. Is the doctrine still current, as an enforcement or policy tool? Certainly the latter, as Graef remarks that [a]lthough the essential facilities doctrine has not been applied recently anymore in EU competition enforcement, it is regularly referred to in EU policy discussions as a tool to open up markets in which ‘tech giants’ act as gatekeepers to consumers.173

He argues that the Commission has side-stepped the doctrine in order to avoid the specific 4.79 conditions imposed by the case-law. This may be less likely in a copyright case than in the Google cases that he analyses. However, it could be useful in a future copyright case to apply the modified doctrine that he recommends. One of his recommendations, not to require the dominant undertaking to be active on a downstream market, is probably the less vital for copyright. More significant is another recommendation, that the requirement of a ‘new product’ be retained to limit the effect of competition interventions on innovation, but allow alternative assessment – as to whether external factors/‘market failures’ such as network effects or switch costs make it ‘commercially unviable’ for a new product to be introduced.

6. Conclusion The essential facilities doctrine has proved a useful adjunct to copyright exceptions and limitations; 4.80 it should be available in the future, possibly in the form proposed by Graef.

NOTES 1. Related instruments Commission Communication ‘Guidance on the Commission’s enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings’ OJ C 45/02, 24.02.2009. Commission Notice on remedies acceptable under the Council Regulation (EC) No 139/2004 and under Commission Regulation (EC) No 802/2004, OJ 2008/C 267/01 22.10.2008. Commission notice ‘Guidelines on the effect on trade concept contained in Articles 81 and 82 of the Treaty’, OJ C101/81, 27.04.2004. Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings, OJ L 24/1, 29.01.2004. Commission Communication ‘The role of European standardisation in the framework of European policies and legislation’, COM(2004) 674 final. Council Regulation (EC) No 1/2003 of 16 December 2002 on the implementation of the rules on competition laid down in Articles 81 and 82 of the Treaty, OJ L 1/1 4.1.2003. Commission Notice ‘Guidelines on the applicability of Article 81 of the EC Treaty to horizontal cooperation agreements’, OJ C3/2, 06.01.2001. Commission Notice on the definition of relevant market for the purposes of Community competition law, OJ C372/5, 09.12.1997. Directive (EU) 2017/1564 of the European Parliament and of the Council of 13 September 2017 on certain permitted uses of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled and amending Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 242/6, 20.9.2017. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC [2019] OJ L130/92, 17.5.2019. EU-Canada Comprehensive and Economic Trade Agreement (CETA), 2016, in force 21 September 2017.

173

Graef, n 42, abstract.

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Chapter 4 THE ESSENTIAL FACILITIES PRINCIPLE AND OTHER ISSUES OF COMPETITION

2. Case law A. CJEU, GC and Commission AKZO Chemie BV v Commission (C-62/86) [1991] ECR I-3359; [1993] 5 CMLR 215 Almelo v NV Energiebedrif Ijsselmij (C-393/92) [1994] ECR I-1477 AstraZeneca AB v European Commission (C-457/10) EU:C:2012:770 British Airways v Commission (C-95/04 P) [2007] ECR I-2331 Bundesverband der Arzneimittel-Importure eV (BAI) and Commission v Bayer (C-2/01, 3/01 P) [2004] ECR I-23 Clearstream Banking AG and Clearstream International SA v Commission (T-301/04) [2009] ECR II-3155; [2009] 5 CMLR 24 Commercial Solvents v Commission (6/73, 7/73) [1974] ECR 223; [1974] 1 CMLR 309 Commission v Germany (C-61/94) [1996] ECR I-3989 Compass-Datenbank GmbH v Republik Österreich (C-138/11) [2012] 5 CMLR 13 Consorzio Italiano della Componentistica di Ricambio per Autoveiculi and Maxicar v Régie des Usines Renault (CICRA) (53/87) [1988] ECR 603; [1990] 4 CMLR 265 Contact Software v. European Commission (T-751/15) ECLI:EU:T:2017:602 Continental Can [1972] CMLR D11 Continental Can Europemballage Corporation and Continental Can Company Inc v Commission of the European Communities (C-6/72) [1973] ECR 215 Cross-border access to pay-TV Commission decision AT.40023, [2019] 4 CMLR 45 Der Grüne Punkt Duales System v Commission (C 385/07) [2009] ECR I-06155 European Night Services Ltd (ENS) v Commission (T-374/94, T-375/94, T-384/94 and T-388/94) 1998 ECR II-3141, [1998] 5 CMLR 718 Federación Nacional de Empresas de Instrumentación Científica, Médica, Técnica y Dental (FENIN) v Commission (T-319/99) [2003] ECR II-357 France Télécom SA v Commission of the European Communities (C-202/07 P) [2009] ECR I-2369; [2009] 4 CMLR 25 Generics (UK) Ltd v Competition and Markets Authority C-307/18 EU:C:2020:52 Google Android Commission decision AT.40099, 18.7.2018, published 20.09.2019 Google Search (Shopping) Commission decision AT.39740 [2018] 4 CMLR 12. An appeal to the General Court, Google Inc v European Commission, (T-612/17) ‘in progress’ GVL v Commission (C-7/82) [1983] ECR 483; [1995] 3 CMLR 645 Hilti v Commission (C-53/92 P) [1994] ECR I-667 Hilti v Commission (T-30/89) [1991] ECR II-1439 Hoffman La Roche v Commission (85/76) [1979] ECR 461; [1979] 3 CMLR 211 Hofner & Elser v Macrotron GmbH (C-41/90) [1991] ECR I-1979 Huawei Technologies Co Ltd v ZTE Corp (C-170/13) EU:C:2015:477; [2015] Bus LR 1261 Hugin Kassaregister AB and Hugin Cash Registers Ltd v Commission (22/78) [1979] ECR 1869; [1979] 3 CMLR 345 IMPALA (T-464/04) [2006] ECR II-2289 IMS Health GmbH & Co OHG v NDC Health GmbH & Co KG (C-418/01) [2004] ECR I-5039; [2004] 4 CMLR 28 IMS Health Inc v Commission of the European Communities (No 1) (T184/01 R) [2001] ECR II-2349; [2002] 4 CMLR 1 Istituto Chemioterapico Italiano and Commercial Solvents v Commission (6/73 and 7/73) [1974] ECR 223; [1974] 1 CMLR 309 Konkurrensverket v TeliaSonera Sverige AB C-52/09 [2011] ECR I-00527 Ladbroke Racing v Commission (T32/93) [1994] ECR II-1015 Michelin I (3222/81) [1983] ECR 3461 Microsoft Corp (The Computing Technology Industry Association Inc and Others, intervening) v Commission of the European Communities (Software & Information Industry Association and Others, intervening) (T-201/04) [2007] ECR II-3601; [2007] 5 CMLR 11 Microsoft Corp v European Commission (T-167/08), 27 June 2012, not yet published NDC Health v IMS Health and Commission (C-481/01 P(R)) [2002] ECR I-3401 Orange Polska SA v European Commission (T-486/11 EU:T:2015:1002), affirmed (C-123/16P) ECLI:EU:C:2018:590 Oscar Bronner GmbH & Co KG v Mediaprint Zeitungs- und Zeitschriftenverlag GmbH & Co KG (C-7/97) [1998] ECR I-7791 Parke Davis v Proebel (24/67) [1968] ECR 55; [1968] CMLR 47

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NOTES Radio Telefis Eireann v Commission of the European Communities (Magill) (C-241/91 P) [1995] ECR I-743; [1995] 4 CMLR 718 Reuter/BASF OJ [1976] L 254/40, [1976] 2 CMLR D44 SAT Fluggesellschaft v Eurocontrol (C-364/92) [1994] ECR I-43; [1994] 5 CMLR 208 Società Consortile Fonografici (SCF) v Marco Del Corso (C-135/10) 15 March 2012, not yet published Sot Lelos kai Sia EE v GlaxoSmithKline AEVE Farmakeftikon Proionton (formerly Glaxowellcome AEVE) (C-468/06) [2008] ECR I-07139 Soulier & Doke v Premier Ministre (C-301/15) ECLI:EU:C:2016:87 Tetra Pak v Commission (C-333/94 P) [1996] ECR I-5951 Tetra Pak v Commission (Tetra Pak II) (T-83/91) [1994] ECR II-755; [1992] 4 CMLR 76 Tiercé Ladbroke v Commission (T-504/93) [1997] ECR II-923 United Brands v Commission (27/76) [1978] ECR 207; [1978] 1 CMLR 429 Unwired Planet International Ltd v Huawei Technologies (UK) Co Ltd [2018] EWCA 2344 Volvo AB v Erik Veng (UK) Ltd (238/87) [1988] ECR 6211; [1989] 4 CMLR 122 Wouters v Algemene Raad van Dederlandsche Orde van Advocaten (C-309/99) [2002] ECR I-1577; [2002] 4 CMLR 913

B. Other courts Authors Guild v Google Inc 804 F. 3d 202 (2d Cir. 2015) (USA) Unlockd Ltd v Google Ireland Ltd [2018] EWHC 1363 (Ch) (UK); [2019] CAT 17 Unwired Planet International Ltd v Huawei Technologies (UK) Co Ltd [2018] EWCA 2344 (UK)

3. Bibliography Akman, P. ‘“Consumer welfare” and Article 82 EC: Practice and rhetoric’, (2009) World Competition, 32(1), 79. Anderman, S. ‘Microsoft v Commission and the interoperability issue’, (2008) EIPR 395. Areeda, P. ‘Essential facilities: An epithet in need of limiting principles’, (1989) Antitrust L.J. 58, 841. Baker, S. and L. Wu, ‘Applying the market definition guidelines of the European Commission’, (1998) ECLR 273. Bartosch, A. ‘Essential facilities: The access to telecommunications infrastructures and intellectual property rights under Article 82 EC’, in C. Koenig, A. Bartosch and J-D. Braun (eds), EC Competition and Telecommunications Law, Kluwer Law International, London, 2002. Bently, L. ‘Parody and copyright in the common law world’, in ALAI ‘Copyright and Freedom of Expression, Proceedings of the ALAI conference Barcelona’, Huygens, 2006. Birnhack, M.D. ‘Copyrighting speech: A trans-Atlantic view’, in P.L.C. Torremans (ed.), Copyright And Human Rights, Kluwer, The Hague, 2004. Burke, A. ‘On the relationship between copyright and antitrust law: Economic versus moral rights’, University of Warwick Centre for Small- and Medium-Sized Enterprises, Working Paper No 74, October 2002, available at http://www2.warwick.ac.uk/fac/soc/wbs/research/ei/research/working_papers. Chan Grinvald, L. and O. Tur-Sinai ‘Intellectual property law and the right to repair’, [2019] Fordham L Rev 88, 63. Cseres, K.J. ‘The controversies of the consumer welfare standard’, (2006) Comp L Rev 121–73. Davies, G. and K. Garnett (eds), Moral Rights, Sweet & Maxwell, London, 2010. Derclaye, E. ‘The IMS Health decision and the reconciliation of copyright and competition law’, (2004) EL Rev 687. Derclaye, E. ‘Repair and recycle between IP rights, end user license agreements and encryption’ in Heath, C. and A. Kamperman Sanders (eds), Spares, Repairs and Intellectual Property Rights, Kluwer Law International, London, 2009. Drexl, J. ‘IMS Health and Trinko – Antitrust placebo for consumers instead of sound economics in refusal-to-deal cases’, (2004) IIC 788. Drexl, J. ‘Designing Competitive Markets for Industrial Data – Between Propertisation and Access’ (2016) Max Planck Institute for Innovation & Competition Research Paper No. 16-13 at p 44. Available at https://ssrn.com/ abstract=2862975. Economides, N. and I. Lianos, ‘A critical appraisal of remedies in the EU antitrust Microsoft cases’, (2010) Columbia Business Law Review, 2, 346. Erickson, K., M. Kretschmer and D. Mendis, ‘Copyright and the economic effects of parody: An empirical study of music videos on the YouTube platform and an assessment of the regulatory options – Parody and Pastiche’, Study III. January 2013 (UK IPO) available at www.ipo.gov.uk/ipresearch-parody-report3–150313.pdf. Evrard, S.J. ‘Essential facilities in the EU: Bronner and beyond’, (2004) Columbia J Eur Law, 10, 1.

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Chapter 4 THE ESSENTIAL FACILITIES PRINCIPLE AND OTHER ISSUES OF COMPETITION Fletcher, A. and B. Lyons, ‘Geographic Market Definition in European Commission Merger Control’ (2016) available at https://ec.europa.eu/competition/publications/reports/study_gmd.pdf. Frischmann, B. and S. Weber Waller, ‘Revitalizing essential facilities’, (2008) Antitrust LJ, 75(1), 1. Geller, P.E. ‘A German approach to fair use: Test cases for TRIPs criteria for copyright limitations?’ (2010) Journal of the Copyright Society of the U.S.A., 57, 553–71. Gormsen, L.L. ‘Collective dominance: An overview of national case law’, e-Competitions| N° 72449, www.concurrences.com, available at https://www.biicl.org/documents/10061_554_collective_dominance.pdf. Gowers Review of Intellectual Property, HM Treasury, London, 2006. Graef, I. ‘Rethinking the Essential Facilities Doctrine for the EU Digital Economy’ (2019), available at https://www. researchgate.net/publication/332401208_Rethinking_the_essential_facilities_doctrine_for_the_EU_digital_economy. Graham, C. EU and UK Competition Law, Longman, Harlow, 2010. Greaves, R. ‘The Herchel Smith Lecture 1998: Article 86 of the EC Treaty and intellectual property rights’, (1998) EIPR 379. Guibault, L. and O. Salamanca, ‘Fitting the Bill’, Ch. 16, p 336 of A. Metzger, ed., Free and Open Source Software (FOSS) and Other Alternative License Models, Springer, 2016. Hart, R. ‘Interoperability information and the Microsoft decision’, (2006) EIPR 361. Hoehn, T. ‘The scope for errors, misconceptions and misunderstandings in the enforcement of European Competition Law’, Paper delivered at 19th St Gallen Competition Law Forum, 7 and 8 June 2012, available at http://ssrn.com/ abstract=2224043. Hoehn, T. and A. Lewis ‘Interoperability remedies, FRAND licensing and innovation: a review of recent case law’ [2013] ECLR 101. Hoppner, T. ‘Competition law in intellectual property litigation: The case for a compulsory licence defense under Article 102 TFEU’, (2011) European Competition Journal, 7, 297. Hou, L. ‘The essential facilities doctrine – what was wrong in Microsoft?’ (2012) IIC 451. Hyland, M. and J. Dumortier, ‘The Ericsson/Qualcomm dispute and the essential facilities doctrine in the mobile telecoms sector’, (1999) Computer and Technology Law Review 150. Ibáñez Colomo, P. ‘EU Competition Law in the Regulated Network Industries’ (2016) LSE Law, Society and Economy Working Papers 08/2016, available at http://eprints.lse.ac.uk/66573/1/__lse.ac.uk_storage_LIBRARY_ Secondary_libfile_shared_repository_Content_LSE%20Working%20Paper_EU%20Competition%20Law_Ibabez _Colomo_EU_Competition_Law_Author.pdf. Ibáñez Colomo, P. ‘Restrictions on innovation in EU competition law’ [2016] Eur L Rev 201. Jacob, R. ‘Parody and IP claims: A defence? – A right to parody?’ in IP at The Edge, Cambridge University Press, Cambridge, 2013. Kallaugher, J. and A. Weitbrecht, ‘Developments under Articles 101 and 102 TFEU in 2010’, (2011) ECLR 333. Koenig, C. and K. Spiekermann, ‘EC competition law issues of standard setting by officially-entrusted versus private organizations’, (2010) ECLR 449. Kolasinski, M. K. ‘Google Shopping decision against the background of the EU and US case law’ [2020] ECLR 234. Kurgonaite, C., P. Treacy, and E. Bond, ‘Looking back to the future – Selective SEP licensing through a competition law lens?’ (2020) J Eur Comp L & Prac 1. Larouche, P. Competition Law and Regulation in European Telecommunications, Hart, Oxford, 2000. Leval, P.N. ‘Toward a Fair Use Standard’, (1990) Harv L Rev, 103, 1105. Lianos, I. ‘Competition law remedies: In search of a theory’, in I. Lianos and D. Sokol, The Global Limits of Competition Law, Stanford University Press, Palo Alto, CA, 2012. Liebowitz, S.J. and S.E. Margolis, ‘Bundles of joy: The ubiquity and efficiency of bundles in new technology markets’, (2008) Journal of Competition Law and Economics, 5, 1. Liu, K-C. ‘The need and justification for a general competition-oriented compulsory licensing regime’, (2012) IIC 679. Longdin, L. and I. Eagles, Refusals to License Intellectual Property: Testing the Limits of Law and Economics, Hart, Oxford, 2011. Mackenrodt, M-O. ‘The political economy of intellectual property rights and competition policy – Report on a Max Planck Conference on Intellectual Property and Competition Law’, (2005) IIC 113. Nathani, S. and P. Akman, ‘The interplay between consumer protection and competition law in India’ (2017) J Antitrust Enforcement, 197. Netanel, N.W. ‘Copyright and “market power” in the marketplace of ideas’, in H. Shelanski and F. Leveque (eds), Antitrust, Patents and Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2005. Nguyen, T.T. ‘Competition rules in the TRIPS Agreement – The CFI’s ruling in Microsoft v Commission and implications for developing countries’, (2008) IIC 558.

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NOTES Reynolds, G. ‘Towards a right to engage in the fair transformative use of copyright-protected expression’, in M. Geist (ed.), From ‘Radical Extremism’ to ‘Balanced Copyright’: Canadian Copyright and the Digital Agenda, Irwin Books, Toronto, 2010. Roffe, P. ‘Control of anti-competitive practices in contractual licences under the TRIPS Agreement’, in C.M. Correa and A.A. Yusuf (eds), Intellectual Property and International Trade: The TRIPS Agreement, Kluwer Law International, London, 1998. Sainsbury, M.T. ‘Parody, satire, honour and reputation: The interplay between economic and moral rights’, (2007) AIPJ, 18, 149. Schumpeter, J.A. Capitalism, Socialism and Democracy, 5th ed., Harper, New York, 1942, Allen and Unwin, London, 1976. Schumpeter, J.A. Business Cycles, vol. 1, McGraw Hill Book Co, New York, 1939. Senftleben, M. ‘The international three-step test: A model provision for EC fair use legislation’, (2010) JIPITEC 67. Sluijs, J.P., P. Larouche and W. Sauter, ‘Cloud computing in the EU Policy Sphere: Interoperability, vertical integration and the internal market’, (2012) JIPITEC 12. Sousa Ferro, M. Market Definition in EU Competition Law, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2019. Spence, M. ‘Intellectual property and the problem of parody’, (1998) LQR, 114, 594. Stamatoudi, I. ‘Are sophisticated multimedia works comparable to video games?’, (2001) Journal of the Copyright Society of the USA, 48, 467. Stamatoudi, I. ‘The hidden agenda in Magill and its impact on new technologies’ (1998) World Intellectual Property 1, 153. Stokes, S. Digital Copyright: Law and Practice, 3rd ed., Hart Publishing, Oxford, 2009. Subramanian, S. ‘EU obligation to the TRIPs Agreement: EU Microsoft decision’, (2010) EJIL 997. Temple Lang, J. ‘Defining legitimate competition: Companies’ duties to supply competitors, and access to essential facilities’, in B.E. Hawk (ed.), 1994 Fordham Corporate Law Institute, FLCS, New York, 1995. Temple Lang, J. ‘Commonly accepted errors and misunderstandings in European Competition Law – Abuse of dominance and patent licensing’, St Gallen International Competition Law Forum, 7/8 June 2012, www.sg-icf.ch. Temple Lang, J. ‘How can the problems of exclusionary abuses under Article102 TFEU be resolved?’, (2012) EL Rev 136. Torremans, P.L.C. Holyoak and Torremans Intellectual Property Law, 7th ed, Oxford University Press, New York, USA, 2013. Torremans, P.L.C. ‘Individual and collective management of rights: A three-dimensional snapshot by way of concluding remarks’ in R. Leska (ed), Proceedings of ALAI 2019 Congress, Prague, Wolters Kluwer, 2020, in press. Ullrich, H. in I. Ulrich and E.-J. Mestmacker (eds), EG-Wettbewerbsrecht, Kommentar , vol. I, Beck, Munich, 1997. Välimäki, M. ‘Copyleft licensing and EC Competition Law’, (2006) ECLR 130. Vaver, D. ‘Moral rights yesterday today and tomorrow’, (1999) IJLIT, 7(3), 270. Walker, M. ‘Bundling: Are US and European views converging?’, (2008) Euro CJ, 4, 275. Wardhaugh, B. ‘Generics (UK) Ltd v Competition and Markets Authority’ [2020] ECLR N39. Weston, S. ‘Software interfaces – Stuck in the middle: the relationship between the law and software interfaces in regulating and encouraging interoperability’, (2012) IIC 427. Whish, R. and D. Bailey, Competition Law, 7th ed, Oxford University Press, Oxford, 2012. Zhang, L. ‘Refusal to license intellectual property rights under Article 82 EC in light of standardisation context’, (2010) EIPR 402.

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Part II THE EU DIRECTIVES AND REGULATIONS

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5 THE SOFTWARE DIRECTIVE Marie-Christine Janssens DIRECTIVE 2009/24/EC of The European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs

[2009] OJ L 111/16 I.

INTRODUCTORY REMARKS 1. Preparatory documents 2. General characteristics A. Enhanced but still inconsistent harmonisation B. Character of lex specialis

ARTICLE 3: BENEFICIARIES OF PROTECTION

5.01 5.01 5.02

II. COMMENTARY

5.02 5.04

II. COMMENTARY 1. Scope of the exclusive rights 2. Right of reproduction A. Reproduction by any means and in any form (art. 4(1)(a)) B. Translations, adaptations, arrangements and any other alteration (art. 4(1)(b)) C. Rental right (art. 4(1)(c)) D. Public lending right is not covered E. Distribution right (art. 4(1)(c)) 3. Right of communication to the public 4. Moral rights not regulated 5. Enforcement of exclusive rights

ARTICLE 1: OBJECT OF PROTECTION II. COMMENTARY 1. Protection as literary works (art. 1(1)) A. The concept of a ‘computer program’ B. Computer programs are literary works within the meaning of the Berne Convention 2. Protection for expression; not ideas (art. 1(2)) A. Principle B. Application to particular elements of a computer program 3. Condition of originality (art. 1(3)) A. The uphill battle for a unified test to assess originality B. Application in relation to (elements of) computer programs 4. Transitional provision (art. 1(4))

5.06 5.06 5.06

5.08 5.14 5.14 5.19 5.33

5.58 5.58 5.60 5.60

5.65 5.69 5.73 5.74 5.92 5.94 5.96

ARTICLE 5: EXCEPTIONS TO THE RESTRICTED ACTS

5.35

5.42 5.42 5.42 5.46

II. COMMENTARY 5.98 1. General remarks 5.98 A. (Non?) Exhaustive character of the list of exceptions 5.98 B. The ‘lawful acquirer’ or ‘person having a right to use’ 5.100 2. Acts necessary for normal use and error correction 5.103 3. Making of back-up copy 5.109 4. Observing, studying or testing the functioning of the program 5.112

5.49

ARTICLE 6: DECOMPILATION

5.38 5.40

ARTICLE 2: AUTHORSHIP OF COMPUTER PROGRAMS II. COMMENTARY 1. General rules A. Initial ownership (art. 2(1)) B. Joint ownership (art. 2(2)) 2. Computer programs created by employees (art. 2(3)) A. Mechanism of transfer of the economic rights B. Normal duties or specific instructions C. No assignment of moral rights

5.57

ARTICLE 4: RESTRICTED ACTS

II. COMMENTARY 1. General 2. Conditions of the exception

5.49 5.52 5.55

5.115 5.115 5.117

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Chapter 5 THE SOFTWARE DIRECTIVE A. Putting into circulation (art. 7(1)(a)) B. Possession for commercial purposes (art. 7(1)(b)) C. Protection for technological protection measures (art. 7(1)(c)) 3. Seizure

A. Only limited acts of reproduction (art. 6(1)) 5.118 B. Aim of interoperability (art. 6(1)) 5.119 C. Acts are indispensable and necessary to achieve interoperability (art. 6(1)) 5.120 D. Interoperability with an independently created program (art. 6(1)) 5.121 E. Acts performed by a licensee or other legitimate user (art. 6(1)(a)) 5.122 F. The necessary information is not readily available (art. 6(1)(b)) 5.123 G. Only decompilation of necessary parts (art. 6(1)(c)) 5.125 H. No use of the information obtained for other purposes (art. 6(2)) 5.126 I. Subject to the ‘three-step’ test (art. 6(3)) 5.131

5.139 5.140 5.143

ARTICLE 8: CONTINUED APPLICATION OF OTHER LEGAL PROVISIONS II. COMMENTARY 1. No prejudice to other forms of protection 2. Mandatory character of the exceptions

5.145 5.145 5.147

ARTICLE 9: COMMUNICATION II. COMMENTARY

5.148

ARTICLE 10: REPEAL ARTICLE 11: ENTRY INTO FORCE

ARTICLE 7: SPECIAL MEASURES OF PROTECTION II. COMMENTARY 1. General remarks 2. Particular remedies and sanctions

5.136

II. COMMENTARY 5.134 5.134 5.136

5.150

ARTICLE 12: ADDRESSEES II. COMMENTARY

5.152

I. INTRODUCTORY REMARKS 1. Preparatory documents 5.01 The computer programs Directive was first announced in the Commission White Paper entitled ‘Completing the Internal Market’ and its substance has been influenced, inter alia, by the results of a comprehensive consultation undertaken in the context of the June 1988 ‘Green Paper on Copyright and the Challenge of Technology’. Following this exercise, a proposal for a Directive was submitted on 5 January 1989. Although the Commission had taken care to reflect a balance between the interests of right holders, of their competitors and of users of computer programs, the proposal met substantial criticism in Parliament and acted as a starting shot for extensive lobbying that was put in motion, focusing in particular on the (narrow) scope of the exceptions to the broad exclusive rights. The Commission had to introduce an Amended Proposal which paved the way for the formal adoption of the Directive on 14 May 1991.1 It became the first harmonising Directive among the many more that the Commission would put in place in the field of copyright.

2. General characteristics A. Enhanced but still inconsistent harmonisation 5.02 This Directive is a good example of a real harmonising Directive because of its precise instructions, leaving the Member States little discretion for deviation. This may be explained by the fact that not all Member States had already enacted an explicit protection scheme for computer programs. On all the matters that are addressed in the Directive fairly uniform legal rules have been put in place throughout the EU. 5.03 However, the sequential and cumulative build-up of the acquis communautaire in the years to follow has led to a number of inconsistencies and uncertainties in levels of protection between different 1

References to all these documents can be found in the Notes below.

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I. INTRODUCTORY REMARKS

subject matters.2 Two examples among many are the limitation on transient copying that was introduced by Directive 2001/29 but does not apply to computer programs and the inconsequential treatment of the protection for technological measures between these two Directives. This problem is exacerbated by the ongoing process of convergence of content formats, transmission media and platforms. It is therefore not inconceivable that the Commission decides on some form of legislative redress in the future.

B. Character of lex specialis From the very outset the particular characteristics of software, including its technological and 5.04 utilitarian nature and the difficulty of distinguishing between idea and expression, have been acknowledged.3 Also, as was said before, several provisions of the Directive had been the subject of difficult debates and reflected a political compromise between the interests at stake. In its Review Paper, the Commission therefore indicated that it was not eager to re-open these discussions. This intention has been respected in all later copyright Directives, which despite being lex posterior took care to reiterate that new provisions ‘should leave intact and shall in no way affect the provisions of the Software Directive’. By doing so, the legislator made clear that the Directive constitutes a lex specialis in relation to all other Directives and, in particular, to general copyright Directive 2001/29.4 The European Court of Justice (ECJ) has endorsed this viewpoint.5 The European Court of Justice (CJEU) has endorsed this viewpoint of the lex specialis character of 5.05 the Directive in its landmark decision UsedSoft and subsequent cases.6 As a consequence, the provisions of the Software Directive take precedence over those of Directive 2001/29 where the protected material falls entirely within the scope of the former. A problem may arise as regards ‘hybrid’ products that consist not only of a computer program but also of some other copyrightable works of different nature, such as musical, photographic and film works as is the case with videogames. This question was at stake in the Nintendo case where the Court was asked whether the technological protection measures, which protect videogames, fall within either the scope of the provisions specifically for computer programs, or the general (and more generous) provisions for copyrightable works. The Court opted for the latter view.7

NOTES 1. Related instruments European Commission, Green Paper on Copyright and the Challenge of Technology – Copyright Issues Requiring Immediate Action, COM (88) 172, 7 June 1988. Commission Proposal for a Council Directive on the legal protection of computer programs with Explanatory Memorandum, COM (88) 816 final – SYN 183 OJ C91/4, 12 April 1989. Commission amended proposal for a Council Directive on the legal protection of computer programs of 18 October 1990, COM (90) 509 final [1990] OJ C320/22, 20 December 1990.

2

3 4 5 6

7

B. Hugenholtz et al. ‘The recasting of copyright and related rights for the knowledge economy’, Study commissioned by the European Commission, 2006, https://www.ivir.nl/publicaties/download/IViR_Recast_Final_Report_2006.pdf accessed 30 March 2020, 215. Green Paper 1988, 179, paras 5.3.10 and 5.6.3. Copyright Review Paper 2004, 6. Case C-128/11 UsedSoft GmbH v Oracle International Corp, 3 July 2012, EU:C:2012:407, paras 60 and 51. Case C-128/11 UsedSoft GmbH v Oracle International Corp, 3 July 2012, EU:C:2012:407, paras 60 and 51. Case C-355/12 Nintendo Co. Ltd e.a. v PC Box Srl and 9Net Srl, 23 January 2014, EU:C:2014:25, para 23. On this lex specialis nature, see Rendas, T., ‘Lex Specialis(sima): Videogames and Technological Protection Measures in EU Copyright Law’ (2015) EIPR, 41. Case C-355/12 Nintendo.

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Chapter 5 THE SOFTWARE DIRECTIVE Directive 91/250/EEC of the European Parliament and the Council of 14 May 1991 on the legal protection of computer programs (1991) L122/42, 17.5.1991. Report of the Commission of 10 April 2000 on the implementation and effects of Directive 91/250/EEC on the legal protection of computer programs. Commission Staff Working Paper on the review of the EC legal framework in the field of copyright and related rights Brussels, 19 July 2004 SEC(2004) 995.

2. CJEU case law Nintendo Co. Ltd e.a. v PC Box Srl and 9Net Srl (Case C-355/12) [2014] ECR I-0000; 23 January 2014, EU:C:2014:25. UsedSoft GmbH v Oracle International Corp (Case C-128/11) [2012] ECR I-0000; 3 July 2012, EU:C:2012:407.

3. Bibliography Hugenholtz, B. et al., ‘The recasting of copyright and related rights for the knowledge economy’, Study Commissioned by the European Commission, 2006, https://www.ivir.nl/publicaties/download/IViR_Recast_Final_ Report_2006.pdf accessed 30 March 2020. Rendas, T., ‘Lex Specialis(sima): Videogames and Technological Protection Measures in EU Copyright Law’ (2015) EIPR, 37, 39–45.

ARTICLE 1: OBJECT OF PROTECTION 1.

In accordance with the provisions of this Directive, Member States shall protect computer programs, by copyright, as literary works within the meaning of the Berne Convention for the Protection of Literary and Artistic Works. For the purposes of this Directive, the term “computer programs” shall include their preparatory design material. Protection in accordance with this Directive shall apply to the expression in any form of a computer program. Ideas and principles which underlie any element of a computer program, including those which underlie its interfaces, are not protected by copyright under this Directive. A computer program shall be protected if it is original in the sense that it is the author’s own intellectual creation. No other criteria shall be applied to determine its eligibility for protection. The provisions of this Directive shall apply also to programs created before 1 January 1993, without prejudice to any acts concluded and rights acquired before that date.

2.

3. 4.

II. COMMENTARY 1. Protection as literary works (art. 1(1)) A. The concept of a ‘computer program’ 5.06 The Directive does not define the notion of computer programs. This lack of a binding definition results from an express choice by the legislature to avoid the Directive ‘becoming outdated’.8 5.07 Useful information regarding the concept of a computer program can be found in the preparatory documents, where it is stated that this notion should be taken to encompass the expression in any form, language, notation or code of a set of instructions, the purpose of which is to cause a computer

8

Explanatory Memorandum 1989, 17 and para. 1.1.

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or information processing device to execute a particular task or function.9 It encompasses all forms of a program, both humanly perceivable and machine readable, from which the program, which causes the machine to perform its function, has been or can be created.10

B. Computer programs are literary works within the meaning of the Berne Convention Article 1 establishes that Member States should treat computer programs for copyright purposes as 5.08 a type of literary work within the meaning of the Berne Convention. This treatment is in accordance with Article 4 WCT, which in turn is in line with Article 10(1) TRIPs. This first part of Article 1 elicits three observations as regards the obligations imposed on the 5.09 Member States.11 First, the Directive takes the clear position that Member States must afford protection to computer 5.10 programs under the copyright system as opposed to any other (existing or not yet existing) regime. This rule should, however, be read together with Article 8, indicating that the Directive is without prejudice to other legal provisions such as patent law or unfair competition. Secondly, protection must be given to computer programs ‘as’ literary works as opposed to any other 5.11 category. This means that they may not be treated as a new and separate sub-category of literary work.12 Also the qualification ‘literary’ rather than ‘literary or artistic works’ has been a deliberate choice in order to make sure that computer programs are not to be treated as ‘applied art’, with the limitations that the Berne Convention permits as to those works.13 The choice for literary works is not surprising in view of the ‘neutral’ meaning, which is traditionally given to this type of work; the literary quality or merit of the work is immaterial. It should be noted, however, that despite the general qualification as literary works, the various 5.12 elements of a computer program may be subject to a plurality of copyright regimes. As will be demonstrated below,14 it follows from the case law of the Court of Justice of the European Union (CJEU), that some elements may qualify as literary works in accordance with Directive 2009/24 on computer programs (e.g., object and source codes) while other elements may constitute literary works that are protected by Directive 2001/29 (e.g., user manual, user graphic interface, programming languages).15 Thirdly, computer programs should be treated as literary works within the meaning of the Berne 5.13 Convention. Consequently, the various minimum rules of the Convention which relate to literary works, such as the prohibition on formalities (art. 5 BC), the rule of national treatment (art. 5(1) BC) and the grant of moral rights (art. 6bis BC) and many more, equally apply to computer programs.16

9 10

11 12 13 14 15 16

A computer program is no more no less than a set of instructions of the various steps that a computer has to carry out; see EPO Technical Board of Appeal 23 February 23, 2006, T-411/03, Clipboard formats II / Microsoft. Explanatory Memorandum 1989, para. 1.1 and p. 17; see also Green Paper 1988, 170; Recital 7 and Opinion AG Bot in Case C-393/09 Bezpecˇnostní softwarová asociace – Svaz softwarové ochrany (BSA) v Ministerstvo kultury (Softwarová) [2010] ECR I-13971, para. 47. Cf L. Bently, ‘Computer Programs Directive’, in T. Dreier, B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law Intern., The Netherlands, 2006, 215–16. Explanatory Memorandum 1989, 18. S. Ricketson and J. Ginsburg, International Copyright and Neighbouring Rights: The Berne Convention and Beyond, vol I, Oxford University Press, New York, 2006, 8.125. See Part II. Commentary to Art. 2. Case C-393/09 Softwarová; Case C-406/10 SAS Institute Inc v World Programming Ltd, 2 May 2012,EU:C:2012:259. Explanatory Memorandum 1989, para. 4.0; Bently, 216; W. Blocher and M. Walter, ‘Computer Program Directive’, in Walter and von Lewinski (eds), European Copyright Law, A Commentary, Oxford University Press, New York, 2010, 98.

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2. Protection for expression; not ideas (art. 1(2)) A. Principle i.

Application of the idea/expression dichotomy

5.14 For the avoidance of doubt, Article 1(2) reiterates the traditional exclusion from copyright: only the expression of a computer program is protected and such protection can in no way be extended to any ideas or principles which underlie any element of a program, including those which underlie its interfaces. This rule is in accordance with international law as it is expressed in Article 9(2) TRIPs as well as in Article 2 of the WCT. The rationale for these rules is that the originality of a work, which gives access to legal protection, lies not in an idea, which may be freely used, but in its expression.17 5.15 While the demarcation of the borderline between the original expressive elements of a work and its unprotected content continues to stir very lively debates in Europe and elsewhere, applying this principle to abstract creations such as computer programs might prove particularly challenging since the idea is part of the essence of the creation. Computer programs have, indeed, a dual nature in the sense that they are textual works which are specifically created to bring about some set of behaviours. They have a functional aspect not to be found in other literary works.18 5.16 To help distinguish expression and idea, Recital 11 clarifies that, to the extent that logic, algorithms and programming languages comprise ideas and principles, those ideas and principles are not protected under that Directive. Moreover: if similarities in the code which implements the ideas, rules or principles occur as between interoperative programs, due to the inevitability of certain forms of expression, where the constraints of the interface are such that in the circumstances no different implementation is possible, then no copyright infringement will normally occur, because in these circumstances it is generally said that idea and expression have merged.19

This is the so-called ‘merger doctrine’, which is highly developed in the US and which holds that where there is only one way (or there are a limited number of ways) to express a particular idea, and where the expression is dictated by the underlying idea, the idea and the expression merge, and the expression does not qualify for copyright protection.20 In its Softwarová decision, the CJEU seems to recognise this doctrine in the European field.21 ii.

Protection for ‘any form of expression of a computer program’

5.17 The Directive mandates protection for any form of expression of a computer program, but fails to define the notion of ‘in any form’.22 On the other hand, this also has a merit: it does not specify a particular form or expression. Recital 7 lifts a corner of the veil by stating that the term ‘computer program’ includes programs in any form, including those which are incorporated into hardware.23

17 18 19 20

21 22 23

Opinion AG Bot in Case C-406/10 SAS Institute, para. 44. J. Bing, ‘Copyright Protection of computer programs’, in E. Derclaye (ed.), Research on the Future of EU Copyright Law, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009, 407. Explanatory Memorandum 1989, para. 3.13. For an analysis, see Cheng Lim Saw, ‘Protecting the sound silence in 4’33’: A timely revisit of basic principles in copyright law’, (2005) EIPR, 12, 467; S. Lay, The Copyright Protection of Computer Software in the United Kingdom, Hart, Oxford, Oregon, 2000, 41. See para. 5.26. Cf Art. 4 WCT ‘whatever may be the mode or form of their expression’ which echoes the wording of art. 2(1) Berne Convention. See the first sentence of the Recital 7 in the preamble to Directive 91/250.

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According to the ECJ it is furthermore ‘abundantly clear’ that it was the intention of the EU legislature to assimilate tangible and intangible copies of computer programs.24 The notion ‘any form of expression’ must be defined having regard to the wording and context of 5.18 Article 1(2) where the reference to it is to be found, as well as in the light of both the overall objectives of that Directive and international law.25 It therefore only includes the forms of expression of a computer program and the preparatory design work capable of leading, respectively, to the reproduction or the subsequent creation of such a program.26

B. Application to particular elements of a computer program i.

Source and object code (yes)

Article 10(1) TRIPS explicitly mentions the (humanly perceivable) source code and the (machine- 5.19 readable) object code as protectable subject matter. Consequently, there is no doubt that these codes from which the program that causes the machine to perform its function has been or can be created are forms of expression of a computer program that benefit from protection under this Directive.27 ii.

User manual and other users’ documentation (no)

From the outset, it was considered that a user manual, which is of such a nature that it cannot lead 5.20 to the creation of a program, will not be protected as part of the computer program.28 This understanding was confirmed in the SAS Institute decision.29 According to the CJEU all the elements of the SAS manuals consist of words, figures or mathematical concepts which, considered in isolation, are not, as such, an intellectual creation of the author of the computer program and do not qualify for the protection conferred by copyright.30 The Court observed, nevertheless, that through the choice, sequence and combination of the words, figures or mathematical concepts used in the manual, the author may express his creativity in an original manner and achieve a result, which is an intellectual creation deserving protection under general copyright.31 The above arguments apply mutatis mutandis to other documentation that is provided to users, such 5.21 as installation and maintenance instructions, online-helpdesk texts and other instructional material.32 iii.

Preparatory design material (yes if)

Article 1(1) expressly confirms that protection also extends to the ‘preparatory design material’ 5.22 leading to the development of a computer program, at least on the condition that the nature of the preparatory work is such that a computer program can result from it at a later stage.33 By way of example the Explanatory Memorandum refers to flow charts or descriptions of sequences of steps in

24 25 26 27 28 29 30 31

32 33

Case C-128/11 UsedSoft, paras 57–58. Case C-393/09 Softwarová, paras 30 and 35. Case C-393/09 Softwarová, paras 35–7 and Opinion AG Bot in this case, para. 61. Cf Case C-406/10 SAS Institute para. 35. Case C-393/09 Softwarová, paras 33–4; Case C-406/10 SAS Institute, para. 38. Explanatory Memorandum 1989, para. 1.1. Case C-406/10 SAS Institute. Ibid., para. 63. Ibid., para. 64. See also Explanatory Memorandum 1989, para. 1.1. In a final decision in this case, the Court of Appeal, England and Wales, however, dismissed SAS’ copyright infringement claims in this respect, reasoning that it would be contrary to the policy of both the Software Directive and the InfoSoc Directive if SAS could secure copyright protection for the functionality of its program indirectly via its manual, which simply explained that functionality (SAS Institute Inc v World Programming Ltd [2013] EWCA Civ 1482). Blocher and Walter, 102. See also Recital 7; Case C-393/09 Softwarová, para. 36 and Case C-406/10 SAS Institute, para. 36.

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plain language as well as embodiments of programs within the hardware itself, either permanently or in removable form.34 Preparatory materials could include a functional or technical design of the software, a program flow diagram or other program specifications as long as no additional steps are still required for the reproducibility of the program.35 5.23 Material created in view of a computer program which cannot as such lead to its development, such as the requirements specification, is not covered because it normally outlines only the functions to be performed and the tasks to be fulfilled, in considering the system environment, describing the necessary interfaces or containing general observations with regard to the problems to be resolved.36 iv.

Interfaces (no)

5.24 The parts of the program that provide for interconnection and interaction between elements of software and hardware are generally known as ‘interfaces’.37 Because they are of paramount importance in the software industry, the possibility of protection of such interfaces had been the subject of heated debates during the passage of the Directive.38 While the final text does not categorically exclude interfaces, several aspects of the Directive do reflect a strong legislative policy in favour of excluding protection for these elements (in particular in order to facilitate interoperability). Most prominently, Recital 11 states, in line with Article 1, that ‘ideas and principles which underlie the various elements of a program, including those which underlie its interfaces, are not protected by copyright under the Directive’ (emphasis added).39 So, clearly the question whether interfaces as such can be protected by the Directive should be answered in the negative. However, where an interface is expressed in source code in the program, the expression of the interface constitutes a substantial part of the expression of the computer program, which then could be eligible for copyright protection under the computer program’s Directive.40 v.

Graphic user interfaces (no)

5.25 The graphic user interface – commonly referred to as the ‘look and feel’ – is an interaction interface which enables communication between the computer program and the user. It makes a more intuitive and user-friendly use of that program possible, for example, by displaying icons or symbols on the screen.41 5.26 Discussions over the question whether graphic user interfaces constitute protected subject matter came to an end in 2010 when the CJEU handed down its Softwarová decision.42 The Court ruled that: a graphic user interface is not a form of expression of a computer program within the meaning of Article 1(2) ( … because it) does not enable the reproduction of that computer program, but merely constitutes one element of that program by means of which users make use of the features of that program.43

34 35 36 37 38 39 40 41 42 43

Explanatory Memorandum 1989, 17. For other examples, see Opinion AG Bot in Case C-393/09 Softwarová, paras 62–3. See case Supreme Court Netherlands (Hoge Raad) 19 January 2018 (Diplomatic Card/Forax) ECLI:NL:HR:2018:56. Blocher and Walter, 101. See Recital 10. See para. 5.01. See also P. Samuelson, ‘The past, present and future of software copyright interoperability rules in the European Union and United States’, (2012) EIPR, 34, 229, 232 and 236. Opinion AG Bot in Case C-406/10 SAS Institute, paras 81–2. Opinion AG Bot in Case C-393/09 Softwarová, paras 2 and 52. See also paras 54–6 with further details on possible forms of interfaces. Case C-393/09 Softwarová. Ibid., para. 41. Cf the concurring Opinion of AG Bot of 14 October 2010, para. 67.

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The Court did, however, not rule out the possibility for a graphic user interface to be entitled to 5.27 protection by general copyright if it qualifies as a work because it is its author’s own intellectual creation.44 Yet the Court observed that that criterion cannot be met by components of the graphic user interface which are differentiated only by their technical function, i.e., where the different methods of implementing an idea are so limited that the idea and the expression become indissociable.45 vi.

Algorithms (no)

An algorithm is a procedure for solving a mathematical problem in a finite number of steps that 5.28 frequently involves repetition of an operation and whereby these steps are usually described on a rather high level of abstraction. It is generally accepted that copyright does not protect mathematical formulas, general rules or scientific theories. In line with this settled opinion, algorithms will not be able to invoke protection under the Directive, as this is also made clear in Recital 11. This recital, however, excludes algorithms only ‘to the extent’ that they comprise non-protectable ideas and principles. Consequently, where algorithms go beyond the abstract description of the solution or basic instructions and can be perceived as a structured solution of a certain problem possible protection by general copyright, they should not be ruled out.46 vii.

Functionality, data files’ format and programming languages

Notwithstanding the explicit language of Recital 11 and the general belief that such elements 5.29 remain outside the Directive’s scope,47 doubts remained about the possible protection for programming languages and comparable functional elements. This uncertainty has been removed by the ECJ in its decision in the case SAS Institute.48 The Court articulates an explicit ban on protection by the Directive for the three elements of a computer program that were subject of the prejudicial questions: ‘neither the functionality of a computer program nor the programming language and the format of data files used in a computer program in order to exploit certain of its functions constitute a form of expression of that program for the purposes of Article 1(2)’.49 Nevertheless, the CJEU observed that, if a third party were to procure the part of the source code or 5.30 the object code relating to the programming language or to the format of data files used in a computer program and if that party were to create, with the aid of that code, similar elements in its own computer program, the outcome of the decision may be different because such conduct would be liable to constitute partial reproduction within the meaning of Article 4(a) of the Directive.50 In addition, the CJEU did not rule out the possibility that the SAS language and the format of the 5.31 SAS Institute’s data files might be protected, as works, by copyright under Directive 2001/29 if they are their author’s own intellectual creation.51

44 45 46 47 48

49 50

51

Case C-393/09 Softwarová, paras 44–7. For an application of the two-prong test of originality to a user graphic interface, see Opinion AG Bot in Case C-393/09 Softwarová, paras 73–7. Case C-393/09 Softwarová, para. 48. On this application of the ‘merger doctrine’, see para. 5.15. Blocher and Walter, 104. Commission Report 2000, 16. Case C-406/10 SAS Institute. For details on the background of the case, see P. Samuelson, T. Vinje and W. Cornish, ‘Does copyright protection under the EU Software Directive extend program behaviour, languages and interfaces?’ (2012) EIPR, 34, 158. Case C-406/10 SAS Institute, para. 39. In his opinion delivered on 20 November 2011, AG Bot provided an interesting analysis as regards each of these three elements. Ibid., paras 42–3. In the case at issue, however, the defendant did not have access to the source code of SAS Institute’s program and had managed to reproduce the functionality of that program, using the same programming language and the same format of data files, by merely observing, studying and testing the behaviour of SAS Institute’s program. Ibid., para. 45. In a final decision in this case, the Court of Appeal, England and Wales dismissed SAS’ copyright infringement claims in this respect: SAS Institute Inc v World Programming Ltd [2013] EWCA Civ 1482.

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viii.

Videogames (no)

5.32 The Court of Justice decided that videogames constitute complex matter comprising not only a computer program but also graphic and sound elements, which, although encrypted in computer language, have a unique creative value that cannot be reduced to that encryption. Insofar as the parts of a videogame, e.g., the graphic and sound elements, are part of its originality, they are protected, together with the entire work, by copyright in the context of the system established by Directive 2001/29.52 In doing so, the Court narrows the scope of the Software Directive to lex specialis for ‘purely’ computer programs and seems to favour a ‘unitary approach’ rather than a ‘distributive approach’ – under which individualised protection would be granted to each component of the videogame based on its specific nature and classification – to determine the appropriate copyright regime for videogames.53 It must be observed, however, that this holding of the Court was not further motivated and may therefore raise serious issues of credibility.54

3. Condition of originality (art. 1(3)) 5.33 According to Article 1(3), the only criterion which can be applied to determine the eligibility for protection of a computer program is that of originality. This Article not only sets the threshold of originality but further defines the level of originality required for the grant of copyright protection: the program must be ‘the author’s own intellectual creation’. 5.34 Originality is the unique conditio sine qua non for the protection of computer programs. As a safeguard it is added that no other criteria can be applied (art. 1(3)) and that no tests regarding the qualitative or aesthetic merits of the program may be used (Recital 8).

A. The uphill battle for a unified test to assess originality 5.35 Prior to the adoption of the Directive, the interpretation of originality varied significantly in the Member States, ranging from the low requirement of ‘skill and labour’ applied in the UK to a (high) level of creativity that the German Supreme Court had imposed for computer programs.55 Because these differences were considered to have direct and negative effects on the functioning of the internal market, the Commission decided to put forward a common standard with an explicit definition of originality.56 It did thereby not choose the lowest common denominator, but opted instead for a compromise to be found somewhere around the middle of the spectrum by way of the criterion of ‘the author’s own intellectual creation’.57 In doing so, the European legislator has for the first time imposed a harmonised interpretation of the requirement of originality in EU law, albeit only for a specific category of copyrightable work. This constituted an important step in the overall process of harmonisation of copyright in the EU. Subsequent Directives could – and indeed did – fall back on the provisions of this first Directive to define the threshold of originality.

52 53 54

55 56 57

Case C-355/12 Nintendo, para 23. On the different approaches see Ramos, A. et.al., ‘The Legal Status of Video Games: Comparative Analysis in National Approaches’, Study commissioned by WIPO, 2013. See critical comments by Rendas, T., ‘Lex Specialis(sima): Videogames and Technological Protection Measures in EU Copyright Law’ (2015) EIPR, 39 and Favale, M. ‘A Wii Too Stretched? The ECJ Extends to Game Consoles the Protection of DRM – on Tough Conditions’, (2015) EIPR, 37, 105. For a thorough examination of the legal protections available in each Member State, see M. Keplinger, ‘International protection for computer programs’, (1990–1991) Software LJ, 15. See Recitals 4 and 5 and Explanatory Memorandum 1989, 38. T. Dreier, ‘Comments to the Berne Convention’, in T. Dreier and B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law Intern., The Netherlands, 2006, 14–15; Bing, 407.

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The criterion of ‘the author’s own intellectual creation’ rapidly became subject to various interpret- 5.36 ations. Some authors considered that the Directive was referring to the Anglo-Saxon interpretation,58 others that this term covered the Continental European interpretation.59 In 2009 the CJEU took the opportunity to take centre stage in shaping the pivotal concept of originality. While the impact of the first landmark decision in the Infopaq case60 was not immediately grasped by all, the subsequent Softwarová ruling on the scope of Directive 2009/24 on computer programs made it clear that the Court was actually extending the ‘author’s own intellectual creation’ test from the Software and Database Directive to other areas, thereby turning it into a uniform notion for all copyright works in the EU.61 In later cases the Court has refined the test in a manner which seems to combine the objective 5.37 common law approach with the subjective ‘droit d’auteur ’ approach. Originality does not merely result from a requisite intellectual activity (which may include labour, skill and judgement) but should moreover bear the mark of the author’s personality (‘a personal touch’).62 This European standard exceeds the international standard of originality as (implicitly63) contained in the Berne Convention, which in turn is incorporated in the TRIPs Agreement and the WCT and according to which a computer program only needs to show ‘intellectual creation’.

B. Application in relation to (elements of) computer programs At first sight, it may seem quite difficult to appreciate the originality of a computer program, which 5.38 presents itself to the user as ‘one package’ but, in fact, contains very different elements.64 Essentially, elements of creativity, skill and inventiveness will manifest themselves in the way in which the program is put together, such as in the case of an anthology. The programmer defines the tasks to be performed by a computer program and carries out an analysis of the possible ways to achieve those results. Like the author of a book, he selects the steps to be taken and the way in which those steps are expressed thereby giving the program its particular characteristics of speed, efficiency and even style.65 Even though many algorithms and sub-routines that are used to design a computer program are commonplace in the industry, the way in which all of these elements are arranged will be likely to reflect the author’s own intellectual creation and therefore be eligible for protection.66 It is for the national court to ascertain, on a case-by-case assessment, whether the computer program is original in this sense, excluding from that assessment the elements whose expression is dictated by their technical function.

58

59 60 61

62 63 64 65 66

Blocher and Walter, 94. These authors consider that the requirement is of a rather low standard in the sense that it has not been copied from another program. We consider this viewpoint no longer accurate in view of the case law of the CJEU mentioned in footnotes 54 and 56. J. Deene, ‘Originality in software law: Belgian doctrine and jurisprudence remain divided’, (2007) Journal of Intellectual Property Law & Practice, 2, 692, 694. Case C-5/08 Infopaq International A/S v Danske Dagblades Forening [2009] ECR I-6569, paras 36–7. Case C-393/09 Softwarová, para. 45. On this evolution, see also M. van Eechoud ‘Along the road to uniformity – Diverse readings of the Court of Justice judgments on copyright work’ (2012) JIPITEC, 60, 63 and T. Synodinou, ‘The foundations of the concept of work in European copyright law’, in T. Synodinou (ed.), Codification of European Copyright Law. Challenges and Perspectives, Kluwer Law Inter. The Netherlands, 2012, 93. See, in particular, Case C-145/10, Eva-Maria Painer v Standard Verlags GmbH, et.al [2011] ECR I-0000, 1 December 2011, para. 88. Its implied existence – not its precise content! – is generally agreed upon with reference to the preparatory documents as well as the wording used in Article 2(5) and (8); Ricketson and Ginsburg, para. 8.03. Bing, 408. Explanatory Memorandum 1989, 5, para. 2.3. Opinion AG Bot in Case C-406/10 SAS Institute, paras 48 and 55; Explanatory Memorandum 1989, 19.

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5.39 Clearly this is not an easy exercise and decisions affording or denying copyright protection for computer programs continue to evoke debate.67 While, in general, it seems easy to recognise the intellectual effort, it may in practice be more difficult to focus on the personality of the author.68

4. Transitional provision (art. 1(4))69 5.40 As with all other copyright Directives, the Directive applies to works that exist at the time of its entering into force. However, because Directive 2009/24 constitutes a more recent codified version, which entirely repeals the initial version,70 it was important to confirm that the protection offered by the new version does not prejudice the protection of programs existing at the time of the coming into force of the initial Directive, i.e., 1 January 1993. 5.41 Also in line with other Directives, Article 1(4) in fine clarifies that the provisions of the Directive should not prejudice ‘any acts concluded’ before 1 January 1993, as in this period parties were not aware of the harmonised protection scheme. Likewise, the Directive should not affect any ‘rights acquired before that date’.71

NOTES 1. Related instruments See references to documents of legislative history in Notes to section ‘Introductory Remarks’.

2. CJEU case law Bezpecˇnostní Ahcnostní softwarová asociace – Svaz softwarové ochrany v Ministerstvo kultury (Case C-393/09) [2010] ECR I-13971. Eva-Maria Painer v Standard Verlags GmbH, et.al (Case C-145/10) [2011], ECR I-0000; 1 December 2011, EU:C:2011:798. Infopaq International (Case C-5/08) [2009] ECR I-6569. Microsoft v Commission (Case T-201/04) [2007] ECR II-03601. Nintendo Co. Ltd e.a. v PC Box Srl and 9Net Srl (Case C-355/12) [2014] ECR I-0000; 23 January 2014, EU:C:2014:25. SAS Institute Inc v World Programming Ltd (Case C-406/10) [2012] ECR I-0000; 2 May 2012, EU:C:2012:259. UsedSoft GmbH v Oracle International Corp (Case C-128/11) [2012] ECR I-0000; 3 July 2012, EU:C:2012:47.

3. Bibliography Bently, L. ‘Computer Programs Directive’, in T. Dreier, B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law Intern., The Netherlands, 2006, 211. Bing, J. ‘Copyright protection of computer programs,’ in E. Derclaye (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009, 401. Blocher, W. and M. Walter, ‘Computer Program Directive’, in Walter, M. and Von Lewinski (eds.) European Copyright Law, A Commentary, Oxford University Press, New York, 2010, 81.

67

68

69 70 71

See, e.g., A. Christie, ‘Designing appropriate protection for computer programs’, (1994) EIPR, 11, 486; P. Samuelson, R. Davis, M.-D. Kapor and J.H. Reichman, ‘A manifesto concerning the legal protection of computer programs’, (1994) Columbia Law Review, 94, 2308; M. Schwarz, ‘Copyright protection is ‘Not on the Menu’: Lotus Development Corp. v. Borland International, Inc.’, (1995) EIPR, 7, 337. See, e.g., the specific criterion of ‘the author’s intellectual contribution’ used in France; Cour de cassation, civile, Chambre civile 1, 17 October 2012, n° 11–21.641 (case Codix) accessed 30 March 2020. This provision is a copy of art. 9(2) of the initial 1991 version of the Directive. See art. 10. For details, see Blocher and Walter, 197–8 and Bently, 237.

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ARTICLE 2: AUTHORSHIP OF COMPUTER PROGRAMS Christie, A. ‘Designing appropriate protection for computer programs’, (1994) EIPR, 11, 486. Deene, J. ‘Originality in software law: Belgian doctrine and jurisprudence remain divided’, (2007) Journal of Intellectual Property Law & Practice, 2, 692. Dreier, T. II. ‘Comments to the Berne Convention,’ in T. Dreier and B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law Intern., The Netherlands, 2006, 7. Favale, M. ‘A Wii too stretched? The ECJ extends to game consoles the protection of DRM – on tough conditions’, (2015) EIPR, 37, 101. Keplinger, M. ‘International protection for computer programs’, (1990–1991) Software LJ 15. Lay, S. The Copyright Protection of Computer Software in the United Kingdom, Hart, Oxford, Oregon, 2000. Lucas, A. ‘Copyright in the European Community: The Green Paper and the Proposal for a Directive concerning legal protection of computer programs’, (1991) Colum. J. Transnat’l L., 29, 145. Ramos, A., L. López, A. Rodríguez, T. Meng and S. Abrams, ‘The Legal Status of Video Games: Comparative Analysis in National Approaches’, Study commissioned by WIPO, 2013, https://www.wipo.int/export/sites/www/ copyright/en/activities/pdf/comparative_analysis_on_video_games.pdf accessed 30 March 2020. Rendas, T. ‘Lex Specialis(sima): Videogames and Technological Protection Measures in EU Copyright Law’, (2015) EIPR, 37, 39–45. Ricketson, S. and J. Ginsburg, International Copyright and Neighbouring Rights: The Berne Convention and Beyond, vol. I, Oxford University Press, New York, USA, 2006. Samuelson P. ‘The past, present and future of software copyright interoperability rules in the European Union and United States’, (2012) EIPR, 34, 229. Samuelson, P., R. Davis, M.-D. Kapor and J.H. Reichman, ‘A manifesto concerning the legal protection of computer programs’, (1994) Columbia Law Review, 94, 2308. Samuelson, P., T. Vinje and W. Cornish, ‘Does copyright protection under the EU Software Directive extend to program behaviour, languages and interfaces?’, (2012) EIPR, 34, 158. Saw, C.L. ‘Protecting the sound of silence in 4’33’: A timely revisit of basic principles in copyright law’, (2005) EIPR, 12, 467. Schwarz, M. ‘Copyright protection is “Not on the Menu”: Lotus Development Corp. v. Borland International, Inc.’, (1995) EIPR, 7, 337. Smith, L.J. ‘Whether copyright protects the graphic user interface of a computer programme’, (2011) Computer and Telecommunications Law Review, 17, 70. Spindler, G. ‘Grenzen des Softwareschutzes’, (2012) Computer und Recht, 417–22. Synodinou, T. ‘The foundations of the concept of work in European copyright law,’ in Synodinou, T. (ed.), Codification of European Copyright Law. Challenges and Perspectives, Kluwer Law Inter., The Netherlands, 2012, 93. van Eechoud, M. ‘Along the road to uniformity – diverse readings of the Court of Justice judgments on copyright work’, JIPITEC, 2012, 60. Vezzoso, S. ‘Copyright, interfaces and a possible Atlantic divide’, (2012) JIPITEC, 3, 153.

ARTICLE 2: AUTHORSHIP OF COMPUTER PROGRAMS 1.

2. 3.

The author of a computer program shall be the natural person or group of natural persons who has created the program or, where the legislation of the Member State permits, the legal person designated as the rightholder by that legislation. Where collective works are recognised by the legislation of a Member State, the person considered by the legislation of the Member State to have created the work shall be deemed to be its author. In respect of a computer program created by a group of natural persons jointly, the exclusive rights shall be owned jointly. Where a computer program is created by an employee in the execution of his duties or following the instructions given by his employer, the employer exclusively shall be entitled to exercise all economic rights in the program so created, unless otherwise provided by contract.

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II. COMMENTARY 1. General rules A. Initial ownership (art. 2(1)) 5.42 In common with all literary works, Article 2 confirms the uncontested principle that copyright attaches to the natural person who created the computer program (i.e., the so-called creator doctrine). 5.43 However, this rule is not exclusive as the first sentence continues with stating that the question of initial authorship as well as (subsequent) ownership is left to the national legislators. This approach does not come as a surprise as this complex issue has remained mostly outside the harmonisation process.72 National jurisdictions may thus designate legal persons as the original copyright holder of a computer program.73 5.44 The (physical or legal) author of a computer program will – through the mere appearance of its name on the work – benefit from the presumption of ownership which is contained in Article 5 of Directive 2004/48 on the Enforcement of Intellectual Property Rights.74 5.45 Paragraph 2 contains a rule on collective works for Member States whose legislation recognises such a concept. This specific qualification concerns the situation of a work which assembles contributions from different authors and is created at the initiative of a physical person or legal entity. At least France, Italy, Spain and Portugal have made use of the option offered by the Directive and vest ownership in corporate, as opposed to natural persons.75

B. Joint ownership (art. 2(2)) 5.46 Article 2 contains a further mandatory requirement on joint authorship. Where a computer program is created by a group of persons jointly – which is normally the case with the development of such works – the exclusive rights shall be initially owned by all of them (jointly). 5.47 This solution is standard and in line with legislation in most Member States.76 It should also apply to software jointly created by juridical persons, such as by a joint venture of corporations.77 5.48 The Directive does not address the notion of joint authorship or the issue of the exercise of the rights which is left to the discretion of each Member State. As a general rule, for a work to qualify as a joint or collaborative work and for a contributor to qualify as a co-author, each contributor must

72

73 74

75 76 77

A. Quaedvlieg, ‘Authorship and ownership: Authors, entrepreneurs and rights,’ in T. Synodinou (ed.), Codification of European Copyright Law. Challenges and Perspectives, Kluwer Law Inter. The Netherlands, 2012, 198; Van Eechoud, 63; Hugenholtz et al., 35. See, e.g., the UK Copyright, Designs and Patents Act 1988, s 9(3). A similar provision is contained in art. 15 Berne Convention. See Case T-19/07 Systran SA and Systran Luxembourg SA v European Commission [2010] ECR II-06083, para. 69 (this judgment was annulled by the CJEU for infringement of jurisdiction rules in Case C-103/11 Commission v Systran SA and Systran Luxembourg SA). Commission Report 2000, 10. In line with art. 7bis Berne Convention, the work’s term of protection is then measured from the death of the last surviving co-author. J. Huet and J. Ginsburg, ‘Computer programs in Europe: A comparative analysis of the 1991 EC Software Directive’ (1992) 30 Colum. J. Transnat’l L. 327, 341.

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ARTICLE 2: AUTHORSHIP OF COMPUTER PROGRAMS

have brought creative expression to the work. It is thereby not required that the contributions are quantitatively or qualitatively equal, so long as they meet the threshold of protectable expression.78

2. Computer programs created by employees (art. 2(3)) A. Mechanism of transfer of the economic rights Employers are entitled to exercise the economic rights in computer programs created by their 5.49 employees. A document confirming the transfer of rights is not required. It is worth noting that computer programs constitute the only subject matter in relation to which European law has been able to impose this so-called work-for-hire rule. The wording ‘entitled to exercise ’ creates a certain ambiguity as regards the mechanism attributing 5.50 the rights to the employer as well as the nature of the ownership rights. In particular, it is unclear whether the Directive establishes a mechanism of a (rebuttable) presumption of transfer of the rights rather than a presumption of initial ownership. The latter wording would be difficult to align with the creator doctrine which is very strictly applied in some Member States.79 In line with the general reticence of the European legislator to rule on issues of authorship and ownership,80 we assume that the Directive did not really intend to impose a particular mechanism in order to avoid disrupting settled principles in certain Member States. The presumption only applies to the elements of the computer program which fall within the scope 5.51 of protection of the Directive. Consequently, unless the national copyright act includes a more general ‘work for hire rule’, copyright to the user manual, user graphic interfaces or other subject matter that falls outside the scope of the Directive, remains the property of the employee.

B. Normal duties or specific instructions The attribution of economic rights only applies in relation to computer programs that are created ‘in 5.52 the execution of the duties or following the instructions given by the employer’. Because in practice, employment contracts often contain very vague clauses or calibrated style formulas, it will be crucial in every particular case to determine which duties have been entrusted to the employee and/or with which additional tasks the employee was charged.81 Clearly, it is not required that the computer program was made during working hours. Because this rule deviates from the general principle that copyright accrues to the author, courts may 5.53 adhere to a restrictive interpretation of the scope of application of the legal presumption.82 However, taking into account the sensitive nature of the issue of employee creations, divergent interpretations in the Member States remain likely.83

78 79 80 81 82

83

P. Goldstein and B. Hugenholtz, International Copyright. Principles, Law and Practice, 3rd ed., Oxford University Press, USA, 2013, 250–51. Hugenholtz et al., 174. Supra, para. 5.41. B. Czarnota and R.J. Hart, Legal Protection of Computer Programs in Europe. A Guide to the EC Directive, Butterworths, London, 1991, 50. See, e.g., Belgian Supreme Court 3 June 2010 (Dekimo), R.D.T.I. 2011, 89 (refusing to apply the legal presumption to directors of a company who did not have the status of an employee); and Austrian Supreme Court, OGH 4 Ob 65/92 – Übungsprogramm, MR 1992, 244 (deciding in favour of a scientific assistant because the writing of the computer program was not considered to come within the scope of his official duties). See, e.g., in the UK Lakeview Computer Services plc v Steadman (1990) (unreported) (accessed 30 March 2020) (concluding that the rights belonged to the company even though the program had been created by its director prior to the incorporation of the company).

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5.54 The rule mandated in Article 2(3) of the Directive does not apply to commissioned works. The text in the original proposal that provided for a similar rule with respect to such works has not been retained. Hence, individual solutions in the Member States will continue to apply.

C. No assignment of moral rights 5.55 With the explicit reference to the ‘economic rights’, Section 3 makes clear that moral rights are not transferred to the employer. This does not come as a surprise as such rights are excluded from the entire scope of the Directive.84 5.56 Many countries allow the employee to maintain the minimum Berne rights but this is no general rule.85 Indeed, in some Member States, tacit renunciation of the moral rights by employees must be assumed.86 E.g., sections 79 and 81 of the UK Copyright Act explicitly deny the right of paternity and integrity to employed authors.

NOTES 1. Related instruments See references to documents of legislative history in Notes to section ‘Introductory Remarks’.

2. CJEU case law Commission v Systran SA and Systran Luxembourg SA (Case C-103/11) 18 April 2013, EU:C:2013:245 (annulment – on jurisdiction grounds – of Systran SA and Systran Luxembourg SA v European Commission (Case T-19/07) [2010] ECR II-06083).

3. Bibliography Blocher, W. and M. Walter, ‘Computer Program Directive,’ in Walter, M. and S. Von Lewinski (eds), European Copyright Law, A Commentary, Oxford University Press, New York, 2010. Czarnota, B. and R.J. Hart, Legal Protection of Computer Programs in Europe. A Guide to the EC Directive, Butterworths, London, 1991. Goldstein, P. and B. Hugenholtz, International Copyright. Principles, Law and Practice, 3rd ed., Oxford University Press, New York, 2013. Huet, J. and J. Ginsburg, ‘Computer programs in Europe: A comparative analysis of the 1991 EC Software Directive’, (1992) Colum J Transnat’l L, 327. Hugenholtz, B. et al., ‘The recasting of copyright and related rights for the knowledge economy,’ Study Commissioned by the European Commission, 2006, https://www.ivir.nl/publicaties/download/IViR_Recast_Final_ Report_2006.pdf accessed 30 March 2020. Lucas, A. ‘Copyright in the European Community: The Green Paper and the Proposal for a Directive concerning legal protection of computer programs’, (1991) Colum J Transnat’l L, 29, 145. Quaedvlieg, A. ‘Authorship and ownership: Authors, entrepreneurs and rights,’ in T. Synodinou (ed), Codification of European Copyright Law. Challenges and Perspectives, Kluwer Law Inter., The Netherlands, 2012. Strowel, A. and E. Derclaye, ‘Droit d’auteur et numérique: Logiciels, bases de données, multimédia ’, Bruylant, Bruxelles, 2001. van Eechoud, M. ‘Along the road to uniformity – Diverse readings of the Court of Justice judgments on copyright work’, (2012) JIPITEC, 60.

84 85 86

See para. 5.92. In Belgium, see art. 4 of the 1994 Computer Programs Act. Quaedvlieg, 203.

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ARTICLE 4: RESTRICTED ACTS

ARTICLE 3: BENEFICIARIES OF PROTECTION Protection shall be granted to all natural or legal persons eligible under national copyright legislation as applied to literary works.

II. COMMENTARY This Article, referring for the purpose of determining beneficiaries of protection to national 5.57 copyright legislation concerning literary works, is largely confirmatory.87 It seeks to ensure that the rules of national treatment under the Berne Convention, to which all Member States are adherents, be applied to computer programs as to all other literary works.88

NOTES 1. Related instruments See references to documents of legislative history in Notes to section ‘Introductory Remarks’.

2. Bibliography Bently, L. ‘Computer Programs Directive,’ in T. Dreier and B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law Intern., The Netherlands, 2006, 211. Blocher, W. and M. Walter, ‘Computer Program Directive,’ in Walter, M. and Von Lewinski (eds), European Copyright Law, A Commentary, Oxford University Press, New York, 2010.

ARTICLE 4: RESTRICTED ACTS 1.

2.

87 88

Subject to the provisions of Articles 5 and 6, the exclusive rights of the rightholder within the meaning of Article 2 shall include the right to do or to authorise: (a) the permanent or temporary reproduction of a computer program by any means and in any form, in part or in whole; in so far as loading, displaying, running, transmission or storage of the computer program necessitate such reproduction, such acts shall be subject to authorisation by the rightholder; (b) the translation, adaptation, arrangement and any other alteration of a computer program and the reproduction of the results thereof, without prejudice to the rights of the person who alters the program; (c) any form of distribution to the public, including the rental, of the original computer program or of copies thereof. The first sale in the Community of a copy of a program by the rightholder or with his consent shall exhaust the distribution right within the Community of that copy, with the exception of the right to control further rental of the program or a copy thereof.

Commission Report 2000, 10. Explanatory Memorandum 1989, 22. See details in Blocher and Walter, 92 and Bently, 220.

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II. COMMENTARY 1. Scope of the exclusive rights 5.58 The sui generis character which is attributed to the Directive89 is clearly reflected in the present Article that deals with the exclusive rights in a way adapted to the technical-industrial nature of computer programs. Article 4 enumerates three sets of acts of reproduction which require the prior consent of the right holder. 5.59 The list of acts, where they relate to the reproduction right, seems to be exhaustive. This means that attributes, which are not explicitly mentioned, such as the ‘destination right’ or the right to limit the use that can be made of copies of a computer program, are not included.90 On the other hand, where Article 4 keeps silence over other exclusive rights, it has a non-exhaustive character and leaves the regulation of such rights to national or EU law. This is, in particular, the case in relation to the right of communication to the public and the moral rights.91

2. Right of reproduction A. Reproduction by any means and in any form (art. 4(1)(a)) 5.60 It was the clear intent of the legislator to put in place a very strong exclusive right of reproduction: every permanent or temporary reproduction of a computer program by any means and in any form, in part or in whole, is a restricted act.92 The acts of loading, displaying, running, transmission or storage of the computer program entirely fall within the scope of the reproduction right, at least ‘in so far as these acts necessitate a reproduction’. This specification has far-reaching consequences because in the digital environment it covers virtually any use of a work even where similar acts of usage in the analogue realm would have fallen well outside the scope of what intellectual property aims to protect.93 5.61 While Article 4(1)(a) lists activities that necessitate acts of reproduction, the Directive fails to set forth criteria for defining what constitutes ‘a reproduction’. Guidance can be found in the accompanying wording ‘permanent or temporary, by any means and in any form, in part or in whole’. 5.62 Permanent or temporary indicates that infringement may occur even where, after normal use of the computer program, the electronic copy is deleted. Processing a work by a computer implies numerous instances of temporary – sometimes very short-lived – copying, apart from the acts of browsing and caching that are generally mentioned.94 The inclusion of the wording ‘temporary’ has therefore been an issue for some time95 but the adoption of a similar definition of the reproduction right in Article 2 Directive 2001/29 seems to have put an end to this discussion.

89 90 91 92 93 94 95

Supra, para. 5.04. Lucas, A., H.-J. Lucas and A. Lucas-Schloetter, Traité de la Propriété Littéraire et Artistique, 4th ed., LexisNexis, Paris, 2012, n° 845. Infra, respectively paras 5.88 and 5.90. Explanatory Memorandum 1989, 24 with reference to the vulnerability of computer programs and the risks of hacking and sabotage. Hugenholtz et al., 54. For a description of the various instances of temporary copying that may take place, see Bing, 413. A. Lucas-Schloetter, ‘The acquis communautaire in the area of copyright and related rights: Economic rights’, in T. Synodinou (ed.), Codification of European Copyright Law. Challenges and Perspectives, Kluwer Law Inter., The Netherlands, 2012, 118.

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The wording ‘by whatever means and in whatever form ’ clarifies that reproduction need not be in the 5.63 same medium as the original program. Acts of reproduction that take place when ‘photocopying source code, by duplicating a program in electronic form in hardware, on a floppy disc, or by downloading a copy from an Internet site’96 would also be the case when converting source code into object code and vice versa.97 The indication ‘in part or in whole ’ can be taken in its literal sense meaning that there is no need to 5.64 reproduce the whole program for an infringement to occur. Thus, the mere reproduction of aspects of the source code, even if it relates to the functionality of a computer program which in itself does not qualify for protection, in the source code of another computer program constitutes an infringement of the author’s exclusive copyright in the first program.98 In the Infopaq decision, the CJEU has held, in relation to the corresponding notion in Article 2 Directive 2001/29, that the notion ‘parts of a work’ is not to be treated any differently from the work as a whole. These parts are protected if the elements reproduced are the expression of the intellectual creation of their author’.99

B. Translations, adaptations, arrangements and any other alteration (art. 4(1)(b)) The right holder is given the exclusive right to (authorise to) alter the computer program. While the 5.65 initial proposal only mentioned the right of adaptation, Article 4 now specifies that all its possible manifestations, such as a translation, an arrangement, or any other alteration of the program are equally included in the exclusive right. Adaptation and translation of programs are acts which the licensee of computer programs may 5.66 frequently wish to do because the program has not stabilised or requires adaptation to changes in user requirements. For all the reproductions that these acts involve, the authorisation of the right holder will be required.100 This will also be the case if a program is translated from one source code language to another or in relation to changes to make the program compatible with other software. Discussion exists as to the qualification of the act of transformation of a program from its source code to object code. While we consider this to constitute an act of reproduction ‘in any form’, others regard it to be an act of translation or even both.101 Article 4(1)(a) further provides that reproductions of the adapted or altered program be regarded as 5.67 acts requiring the authorisation of the right holder of the original program. Finally, this Article contains a without prejudice clause in relation to the rights of the person who 5.68 alters the program. In this way the Directive indirectly recognises that adaptations of software can by themselves be given copyright protection. This is interesting as there exists no general European rule on adaptations as protected subject matter.102 On the other hand, the Berne Convention in its Article 2(3) concerning derivative works does specify that protection is due to translations and adaptations.

96 97 98 99 100

101 102

Bently, 221. See also para. 5.64. Opinion AG Bot in Case C-406/10 SAS Institute, paras 58–9. Case C-5/08 Infopaq International A/S v Danske Dagblades Forening [2009] ECR I-6569, paras 38 and 51 (and paras 29 and 32). Case C-666/18 IT Development SAS v Free Mobile SAS [2019] ECR I-0000, 18 December 2019, EU:C:2019:1099, paras 32–4 where the Court ruled that the non-respect of the prohibition in a software licence agreement on modifying the source code of a software package constitutes an infringement of the copyright of a computer program irrespective of the origin, whether contractual or otherwise, of that infringement. Bently, 221–2. Hugenholtz et al., 34.

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C. Rental right (art. 4(1)(c)) 5.69 A right of commercial rental is likewise afforded to the right holder. This obligation is in compliance with the obligations in Article 11 TRIPs and 7(2)(i) WCT.103 These international provisions, however, provide that ‘this obligation does not apply to rentals where the program itself is not the essential object of the rental’.104 Although this latter aspect is not dealt with in Article 4, it is generally accepted that such incidental rental does not lead to liability (e.g., rental of automobiles).105 5.70 The general rule of the exclusive right of rental is laid down in Directive 2006/115 on rental right and lending right, but its Article 4 leaves intact the rental right in computer programs. The wording of the definitions is slightly different, though. Where Directive 2009/24 on computer programs relates to ‘making available for use, for a limited period of time and for profit-making purposes’,106 Article 1(2) of the Rental Right Directive speaks of ‘for direct or indirect economic or commercial advantage’. Although the latter term seems broader, it is doubtful whether it reflects a substantive difference rather than a mere clarification.107 5.71 Rental would cover the activities of an entity which allows customers, on making a payment, to take home computer programs for a limited period of time.108 This right will, more generally, also include the arrangement where the licence to use a program relies on periodic payments, often combined with a maintenance contract for keeping the program current with respect to the developments of hardware and other relevant programs.109 5.72 It is generally understood that the rental right only relates to copies embodied in a tangible medium and does, therefore, not cover so-called electronic rental110 provided the latter cannot be qualified as ‘a sale’. The distinction between the notions rental and sale is important taking into account the settled case law of the Court of Justice that exhaustion does not arise in the case of rental111 but that it does in the case of transfer of ownership.112

D. Public lending right is not covered 5.73 Preamble 12 clearly states that the term ‘rental’ does not include public lending, which is to be understood as the making available for use for a limited period of time and not for profit-making purposes. Because this right is explicitly left outside the scope of this Directive, the application of the general public lending right imposed by Article 3 of Directive 2006/115 on rental right and lending right can be advocated.113 This interpretation is supported by Article 4 of the latter Directive which explicitly mandates that it shall be without prejudice to Article 4(c) of Directive 2009/24 on computer programs dealing only with the rental right.

103 104 105 106 107 108 109 110 111 112 113

Such provision did not yet exist under the Berne Convention, which explains its inclusion in these international treaties. See in this respect, Lucas et al., 2012, 1326–7. Bently, 224; Hugenholtz et al., 49. Recital 12 Preamble to Dir. 2009/24 on computer programs. Hugenholtz et al., 49; J. Krikke, ‘Rental and Lending Rights Directive’, in T. Dreier and B. Hugenholtz (eds), Concise European Copyright Law, 248 (‘The different wording is […] merely historic’). Bently, 224. Bing, 420. Bently, 224. Case C-200/96 Metronome Musik [1998] ECR I-1953. Case C-456/06 Peek & Cloppenburg [2008] ECR I-2731; Opinion AG Bot in Case C-128/11 UsedSoft, paras 56–8. See also more details in Part II. Commentary to art. 4(2). Krikke, 248.

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E. Distribution right (art. 4(1)(c)) i.

Scope of the right

While reproduction and derivative acts are set out in the Directive in express recognition of the 5.74 utilitarian nature of a computer program, the right of distribution granted in paragraph (c) is stated in more traditional terms. The restricted acts cover the distribution to the public of the original or a copy of a computer program. The use of the words ‘any form of distribution’ is somehow ambiguous and could be read as encompassing online transmission. Such an interpretation is not supported. According to the majority holding, the distribution right is designed in reference to distributing material support only, as opposed to online diffusion.114 There is no definition of the phrase ‘to the public’. Considering the jurisprudence of the Court of 5.75 Justice as regards the notion ‘public’ in respect of the general public communication right,115 it seems however no longer justifiable to state that it is a matter for the Member States to decide when a transfer, e.g., which takes place within a corporate grouping or to a family member, would be regarded as a distribution ‘to the public’.116 Further European case law on the meaning of this notion in respect of computer programs will have to provide clarification. ii.

Subject to the exhaustion principle in EU law (Art. 4 (2))

(a) Rule The first sale in the EU (or more precisely in the European Economic Area (EAA)) of a copy of a 5.76 computer program by the right holder or with his consent exhausts the distribution right within the EEA of that copy.117 Exhaustion of the right to distribute the copy of a computer program is subject to two conditions: (i) the copy must have been placed on the market and, more specifically, sold by the right holder or with his consent, and (ii) it must have been placed on the market in the European Union.118 In such a case the right holder loses the right to rely on his monopoly on exploitation in order to oppose the importation of these programs into another Member State. If sale is the first means of distribution, property rights pass from the right holder to the purchaser in the physical support of the copy of the program, and the purchaser is free to dispose of that tangible property in any way he chooses, except that he may not offer it for rental or licensing. He may, however, give away or otherwise dispose of the physical support.119 (b) Five general remarks First, since no provision is made for the exclusive distribution right to be exhausted within the 5.77 European Union by a first sale outside the EU, Member States are not free to provide for such international exhaustion in respect of computer programs.120

114 115 116 117

118 119 120

Lucas-Schloetter, 120; Lucas, 2010, 309–12. See also Commission Report 2000, 17. See Part II. Commentary to art. 3 Dir. 2001/29. This was advocated by Bently, 223. On the history of, and rationale behind, the exhaustion principle, see M. Röttinger, ‘The exhaustion of copyright’, (1993) RIDA 157, 50; T. Targosz, ‘Exhaustion in digital products and the “accidental” impact on the balance of interests in copyright law’, in L. Bently, U. Suthersanen and P.L.C. Torremans (eds), Global Copyright, Three Hundred Years Since the Statute of Ann from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010, 340 ff; A. Wiebe, ‘The economic perspective: exhaustion in the digital age’, ibid., 322; Overdijk et al., ‘Exhaustion and software resale rights. A comparison between the European exhaustion doctrine and the U.S. first sale doctrine in the light of recent case law’, (2011) Cri, 33. See also Case 78/70 Deutsche Grammophon Gesellschaft mbH v Metro-SB-Großmärkte GmbH & Co. KG [1971] ECR 487. Case C-166/15 Aleksandrs Ranks and Jurijs Vasiļevicˇs v Finanšu un ekonomisko noziegumu izmeklēšanas prokoratūra and Microsoft Corp., 12 October 2016, EU:C:2016:762, para 27. Czarnota and Hart, 60. Commission Report 2000, 11; Case C-479/04 Laserdisken ApS v Kulturministeriet [2006] ECR I-08089; S. von Lewinski, ‘International exhaustion of the distribution right under EC copyright law’ (2005) EIPR, 27, 233.

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5.78 Second, it is clear from the text of Article 4(2) that only the right of distribution is subject to exhaustion, not the right of reproduction or alteration. 5.79 Third, although the right of distribution is broadly defined, only one form of distribution, i.e., sale, triggers the exhaustion rule, whereas, once that rule has been brought into play, its effects extend to any form of distribution, with the exception of rental.121 Since Article 4(2) does not make a reference to national laws as regards the meaning to be given to the term ‘sale’, it is settled case law that such a term must be regarded as designating an autonomous concept of European Union law, which must be interpreted in a uniform manner in the Member States.122 5.80 The Court of Justice favours a broad interpretation of the term ‘sale’, encompassing any commercial transaction involving a transfer of the right of ownership in an item of property. More in general, all forms of product marketing characterised by the grant of a right to use a copy of a computer program, for an unlimited period, in return for payment of a fee designed to enable the copyright holder to obtain a remuneration corresponding to the economic value of the copy of the work constitutes ‘a sale’ giving rise to exhaustion.123 The manner by which the copy of the program has been made available does not make a difference.124 Hence, suppliers cannot merely call the contract a ‘licence’ rather than a ‘sale’ in order to circumvent the rule of exhaustion and divest it of all scope.125 5.81 Fourth, the exhaustion rule is expressed with respect to consent given by the right holder with respect to the sale of a copy of a program. It can be assumed that this condition should be given an interpretation in line with the case law regarding trademarked goods where the CJEU requires, as a condition for exhaustion to operate, the right holder’s unequivocal consent to the release of every single copy.126 5.82 Fifth, although the Court’s extensive case law in this area has fashioned the ‘doctrine of community exhaustion’, which can be applied uniformly to all intellectual property rights (IPRs), the fact remains that the conditions governing the application and scope of the rule may vary depending on the particular characteristics of each IPR in question and the particular provisions governing it.127 As will be demonstrated below, this latter holding is very relevant for this Directive.128 (c) A ‘first sale’ of a copy fixed on a tangible medium 5.83 According to the traditional understanding the rule of exhaustion is limited to tangible property and does not apply to intangible copies.129 As regards computer programs, this means that the first marketing in the European Union, by the copyright holder, of a copy of the program stored on a material medium such as floppy discs, CD-ROMs or DVD-ROMs, will constitute a first sale of that copy leading to exhaustion of the distribution right of that copy. If this sale is furthermore

121 122

123 124 125 126

127 128 129

Case C-128/11 UsedSoft, para. 49; Case C-166/15 Ranks and Vasiļevicˇs, para. 28. Case C-128/11 UsedSoft, paras 39 and 41, with references to Case C-5/08 Infopaq International [2009] ECR I-6569, para. 27; Case C-34/10 Brüstle v Greenpeace [2011] ECR I-09821, para. 25; and Case C-510/10 DR and TV2 Danmark [2012] ECR I-0000, paras 33–4. Case C-128/11 UsedSoft, paras 42 and 45; Opinion AG Bot in this case, para. 59. Case C-128/11 UsedSoft, para. 47. Opinion AG Bot in Case C-128/11 UsedSoft, paras 59 and 61. Case C-173/98 Sebago Inc. and Ancienne Maison Dubois & Fils SA v G-B Unic SA [1999] ECR I-04103. Regarding the conditions for a valid ‘consent’, see Joined Cases C-414/99 to C-416/99 Zino Davidoff and Levi Strauss [2001] ECR I-8691. Opinion AG Bot in Case C-128/11 UsedSoft, para. 46. See Part II. Commentary to art. 4(2). Lucas-Schloetter, 120; Lucas, 2010, 312–14; Bing, 420–21; Bently, 223.

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accompanied by an unlimited user licence, the right holder cannot prevent the acquirers of the copy from reselling it, notwithstanding contractual terms to the contrary.130 This understanding is in line with the opinion that the umbrella of the distribution right does not 5.84 include an immaterial distribution right.131 The same restrictive understanding of the concept of exhaustion can be found in Directive 96/9 on databases where Recital 33 makes clear that exhaustion does not arise in the case of online databases. Also Directive 2001/29 provides clear evidence of the EU legislature’s wish132 – confirmed by later case law133 – to limit the rule to a single form of distribution of the work, that is to say the sale of an item of goods incorporating the work. The exhaustion of the distribution right concerns only the copy of the computer program itself and 5.85 the accompanying user licence, but not the material medium on which that copy has been first offered for sale. Considering that Article 4 grants the copyright holder the exclusive right to do or to authorise the reproduction of that program by any means and in any form, the Court of Justice decided that the rule of exhaustion is not applicable in respect of the resale of a copy of a computer program stored on a non-original material medium. This is even so in a situation whereby the original material medium has been damaged, destroyed or lost and the lawful user could invoke the exception allowing him to made a back-up copy.134 In other words, even a lawfully made back-up copy of a computer program cannot be provided to a new acquirer without the authorisation of the rightholder. (d) A ‘first sale’ of a copy fixed on an intangible medium The logic that exhaustion is conditional on the sale of tangible copies clashes with market practices. 5.86 Nowadays software is essentially purchased via downloads online whereby the underlying contract would typically exclude the transfer of the software or the licence without consent of the right holder, thereby limiting or even excluding the effects of exhaustion.135 Moreover, and notwithstanding such contractual terms, a new business model has emerged that carries on business as a seller of used or unwanted software licences (known as shelf ware). Against this background, the question was raised whether the exhaustion rule would be capable of 5.87 encompassing intangible copies of computer programs downloaded from the internet.136 Clearly, a negative response would have the effect of limiting the scope of that rule very significantly and, at the same time, restricting the freedom to trade in second-hand software.137

130 131 132 133 134

135 136

137

Case C-166/15 Ranks and Vasiļevicˇs, paras 29–30. See para. 5.74. See in particular Recitals 28 and 29. Case C-456/06 Peek & Cloppenburg [2008] ECR I-2731 and other case law mentioned in para. 30 of this decision. Case C-166/15 Ranks and Vasiļevicˇs, paras 34–44. For a critical analysis of this decision see S. Geiregat, ‘Digital exhaustion of copyright after CJEU judgment in Ranks and Vasiļevicˇs’, (2017) Computer Law & Security Review, 33, 521 and Linklater, E. ‘UsedSoft and the Big Bang Theory: Is the e-Exhaustion Meteor about to Strike?’, (2014) JIPITEC 5, 12–22. See also commentary to Art. 5(2). These contractual terms were not always validated by courts; see, e.g., German Federal Supreme Court (BGH) 6 July 2000 (OEM software), I ZR 244/97 (2001) GRUR 153. Pro: T. Hoeren, ‘Der urheberrechtliche Erschöpfungsgrundsatz bei der Online-Übertragung von Computerprogrammen’, (2006) CR 573. Contra: Wiebe, 321. In general, see E. Tjong Tjin Tai, ‘Exhaustion and online delivery of digital works’, (2003) EIPR 207; M. Peters, ‘The legal perspective on exhaustion in the borderless era: First sale doctrine for online transmissions of digital works in the United States’ in L. Bently, U. Suthersanen and P.L.C. Torremans (eds), Global Copyright, Three Hundred Years Since the Statute of Ann from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010, 329. Opinion AG Bot in Case C-128/11 UsedSoft, para. 77.

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5.88 In the landmark decision UsedSoft, the CJEU has enlightened this grey zone of the Directive and, even more, seems to have opened up the market for second-hand software licences.138 With reference to the legislator’s intention, the Court confirms that the exhaustion of the distribution right concerns both tangible and intangible copies of a computer program. Accordingly, a copy of a computer program under Article 4(2) shall be interpreted as detached from any tangible medium on which it can be placed. The Court further expressly concludes that a first sale triggering exhaustion may also occur if a customer downloads a copy of the software as part of a perpetual licence agreement for the use of such copy in return for full payment.139 The CJEU motivates its decision by observing that in relation to computer programs online transmission is, from an economic point, ‘functionally equivalent’ to delivery on tangible media.140 In the eyes of the Court limiting the application of the principle of exhaustion solely to tangible copies of computer programs would also go beyond what is necessary to safeguard the specific subject matter of the intellectual property concerned and could lead to the partitioning of markets.141 Reference is furthermore made to the lex specialis character of the Software Directive in relation to Directive 2001/29 which allows for a deviating interpretation of certain notions.142 5.89 It is furthermore decided in the UsedSoft case that exhaustion also extends to updates and upgrades of the software that have been provided under a maintenance agreement but not to the agreement itself. That is because, even in the case where the maintenance agreement is for a limited period, the functionalities corrected, altered or added on the basis of such an agreement form an integral part of the copy originally downloaded.143 5.90 The CJEU has imposed two important restrictions to the application of the rule of exhaustion in relation to downloaded copies. First, an original acquirer who resells a tangible or intangible copy of a computer program for which the copyright holder’s right of distribution is exhausted must, in order to avoid infringing the exclusive right of reproduction, make his own copy unusable at the time of its resale.144 Because this may be difficult to prove, the distributor – whether ‘classic’ or ‘digital’ – can make use of technical protective measures such as product keys.145 Second, if the licence acquired by the first acquirer relates to a greater number of users than he needs, the acquirer is not authorised by the effect of the exhaustion of the distribution right to divide the licence and resell only the user right for the computer program concerned corresponding to a number of users determined by him. In such a situation, the customer of the copyright holder would indeed continue to use the copy of the program installed on his server and will not thus make it unusable.146 5.91 While the UsedSoft decision has certainly shaken the foundations of the exhaustion doctrine, it should be observed that its practical impact may be tempered by new business practices that right holders will adopt. It is to be expected that perpetual licences for a fully paid-up fee will be replaced by royalty-based temporary licences or ‘Saas’ models (‘Software as a Service’).147

138 139 140 141 142 143 144 145 146 147

Case C-128/11 UsedSoft. See on the consequences for the software market L.G. Grigoriadis, ‘Exhaustion and software resale rights in light of recent EU case law’, (2014) Journal of International Media and Entertainment Law 111–28. Ibid., para. 59. Ibid., para. 61. Ibid., paras 62–3. Opinion AG Bot in ibid., para. 73. Ibid., paras 66–8. Ibid., para. 70. Ibid., paras 78–9. Ibid., paras 69–70. Cf. Wiebe, 327 and T. Cook, ‘Exhaustion – a casualty of the borderless digital era’, in L. Bently, U. Suthersanen and P. Torremans (eds), Global Copyright, Three Hundred Years Since the Statute of Ann from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010, 365.

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3. Right of communication to the public As is immediately apparent from the wording of Article 4, only acts of reproduction are mentioned 5.92 among the restricted acts. It even frames display and transmission of software as restricted acts in the context of the reproduction right in Article 4(a) but otherwise keeps silent in respect of the attributes of the right of communication to the public which is generally attributed to literary works. As was said before, Article 4 is non-exhaustive.148 Therefore, and even though it is nowhere 5.93 mentioned in the Directive, it is generally accepted that the normal right of communication to the public continues to apply by virtue of the principle of lex specialis which allows for the application of national and international rules in this respect.149

4. Moral rights not regulated The Directive contains no provision on moral rights because they have deliberately been excluded 5.94 from the scope of the Directive.150 This does not come as a surprise in view of the reticent attitude that the European legislator has adopted – and continues so to do – regarding this issue in the framework of the EU acquis.151 Where these rights are left to the competence of the Member States’ internal law, domestic 5.95 regulation is, of course, itself constrained by the Berne Convention, which in its Article 6bis requires protection of at least the author’s rights of attribution and of integrity.152

5. Enforcement of exclusive rights The liability regime applicable in the event of infringement of the copyright of a computer program 5.96 by a licensee of that program falls within the competence of the Member States. National legislature remains thus free to lay down the specific practical arrangements for protecting those rights and to define, in particular, the nature, whether contractual or tortious, of the action available to the holder of those rights.153 Notwithstanding such leeway to Member States, the application of a particular liability regime 5.97 should in no way constitute an obstacle to the effective protection of the intellectual property rights of the owner of the copyright of that program as established by this Directive as well as Directive 2009/24 on the enforcement of intellectual property rights. This means that a breach of a clause in a licence agreement for a computer program relating to the intellectual property rights of the owner of the copyright of that program falls within the concept of ‘infringement of intellectual property rights’, within the meaning of the aforementioned Directive 2004/48, and that, therefore, that owner must be able to benefit from the guarantees provided for by that Directive, regardless of the liability regime applicable under national law.154

148 149 150 151 152 153 154

Supra, para. 5.57. See para. 5.04 and Copyright Review Paper 2004, 8. For further details on the scope of this right, see Part II. Commentary to art. 3(1) Dir. 2001/29. Commission Report 2000, 6. Janssens, 95–99; Dietz, 336. See Recital 19 stating that Dir. 2009/24 on computer programs ‘does not affect derogations provided for under national legislation in accordance with the Berne Convention on points not covered by this Directive’. Case C-666/18, IT Development SAS, paras 44 and 46. Case C-666/18, IT Development SAS, paras 46 and 49.

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NOTES 1. Related instruments Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases, OJ L 77, 27/3/1996. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167, 22/6/2001. Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376, 27/12/2006. See also references to documents of legislative history in Notes to section ‘Preliminary Observations’.

2. CJEU case law Aleksandrs Ranks and Jurijs Vasiļevicˇs v Finanšu un ekonomisko noziegumu izmeklēšanas prokoratūra and Microsoft Corp (Case C-166/15) [2016] ECR I-0000, 12 October 2016, EU:C:2016:762 Deutsche Grammophon Gesellschaft mbH v Metro-SB-Großmärkte GmbH & Co. KG (Case 78/70) [1971] ECR 487 Infopaq International A/S v Danske Dagblades Forening (C-5/08) [2009] ECR I-6569 IT Development SAS v Free Mobile SAS (C-666/18) [2019] ECR I-0000, 18 December 2019, EU:C:2019:1099 Laserdisken ApS v Kulturministeriet (C-479/04) [2006] ECR I-08089 Metronome Musik (C-200/96) [1998] ECR I-1953 Peek & Cloppenburg (C-456/06) [2008] ECR I-2731 Sebago Inc. and Ancienne Maison Dubois & Fils SA v G-B Unic SA (Case C-173/98) [1999] ECR I-04103 Silhouette International Schmied GmbH & Co. KG v Hartlauer Handelsgesellschaft mbH (C-355/96) [1998] ECR I-04799 UsedSoft GmbH v Oracle International Corp. (C-128/11) [2012] ECR I-0000, 3 July 2012, EU:C:2012:407 Zino Davidoff and Levi Strauss (C-414/99–C-416/99) [2001] ECR I-8691

3. Bibliography Bently, L. ‘Computer Programs Directive’, in T. Dreier and B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law Intern., The Netherlands, 2006. Bing, J. ‘Copyright protection of computer programs’, in E. Derclaye (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009. Blocher, W. and M. Walter, ‘Computer Program Directive’, in M. Walter and S. Von Lewinski (eds), European Copyright Law, A Commentary, Oxford University Press, New York, 2010. Bräutigam, P. ‘Second-hand software in Europe: Thoughts on the three questions of the German Federal Court of Justice referred to the Court of Justice of the European Union’, (2012) Computer Law Review International, 1, 1. Cook, T. ‘Exhaustion – A casualty of the borderless digital era’, in L. Bently, U. Suthersanen and P. Torremans (eds), Global Copyright, Three Hundred Years Since the Statute of Ann from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010. Czarnota, B. and R.J. Hart, Legal Protection of Computer Programs in Europe. A Guide to the EC Directive, Butterworths, 1991. Dietz, A. ‘The protection of intellectual property in the information age – The Draft EU Copyright Directive of November 1997’, (1988) IPQ, 336. Geiregat, S., ‘Digital exhaustion of copyright after CJEU judgment in Ranks and Vasiļevicˇs’, (2017) Computer Law & Security Review, 33, 521–40. Göbel, A. ‘The principle of exhaustion and the resale of downloaded software – The UsedSoft / Oracle case’, (2012) European Law Reporter, 228–34. Grigoriadis, L.G. ‘Exhaustion and software resale rights in light of recent EU case law’, (2014) Journal of International Media and Entertainment Law, 4, 111–28. Hoeren, T. ‘Der urheberrechtliche Erschöpfungsgrundsatz bei der Online-Übertragung von Computerprogrammen’, (2006) CR, 573. Hugenholtz, B. et al., ‘The recasting of copyright and related rights for the knowledge economy’, Study Commissioned by the European Commission, 2006, https://www.ivir.nl/publicaties/download/IViR_Recast_Final_ Report_2006.pdf accessed 30 March 2020. Jaeger, T. ‘Die Erschöpfung des Verbreitungsrechts bei OEM-Software’, (2000) ZUM, 1070.

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ARTICLE 5: EXCEPTIONS TO THE RESTRICTED ACTS Janssens, M-C. ‘Le droit moral en Belgique’ (2013), 25 Les Cahiers de propriété intellectuelle 91. Krikke, J. ‘Rental and Lending Rights Directive’, in T. Dreier and B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law Intern., The Netherlands, 2006. Lefèvre, A., ‘La mise à disposition de copies de logiciels par téléchargement sur internet épuise le droit exclusif de distribution de l’éditeur sur ces copies’ (2012) Droit de l’immatériel: informatique, médias, communication nº 85, 21–6. Leriche, S. and J. Ruelle, ‘L’épuisement des droits à l’ère de la dématérialisation: une première avancée (à propos de l’arrêt Usedsoft GmbH c/ Oracle, CJUE, 3 juillet 2012)’, (2012) Droit de l’immatériel: informatique, médias, communication nº 86, 30–7. Linklater, E. ‘UsedSoft and the big bang theory: is the e-exhaustion meteor about to strike?’, (2014) JIPITEC 5, 12–22. Lucas, A. ‘Droit d’auteur et droits voisins – Droit de distribution – Logiciel – Téléchargement – Épuisement (oui)’, (2012) Propriétés intellectuelles nº 44, 333–7. Lucas, A. ‘International exhaustion’, in L. Bently, U. Suthersanen and P.L.C. Torremans (eds), Global Copyright, Three Hundred Years Since the Statute of Ann from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010. Lucas, A., H-J. Lucas and A. Lucas-Schloetter, Traité de la Propriété Littéraire et Artistique, 4th ed., LexisNexis, Paris, 2012. Lucas-Schloetter, A. ‘The acquis communautaire in the area of copyright and related rights: Economic rights’, in T-E. Synodinou (ed.), Codification of European Copyright Law. Challenges and Perspectives, Kluwer Law Inter., The Netherlands, 2012. Newman, J. ‘New lyrics for an old melody: The idea/expression dichotomy in the computer age’, (1999) Cardozo Arts & Ent. LJ, 17, 691. Overdijk, T., P. Van Der Putt, E. De Vries and Th. Schafft, ‘Exhaustion and software resale rights. A comparison between the European exhaustion doctrine and the U.S. first sale doctrine in the light of recent case law’, (2011) Cri, 33. Palmer, A. and Th. Vinje, ‘The EC Directive on the Legal Protection of Computer Software: New law governing software’, (1992) Duke Journal of Comparative & International Law, 2, 65. Peters, M. ‘The legal perspective on exhaustion in the borderless era: Consideration of a digital first sale doctrine for online transmissions of digital works in the United States’, in L. Bently, U. Suthersanen and P.L.C. Torremans (eds), Global Copyright, Three Hundred Years Since the Statute of Ann from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010. Röttinger, M. ‘The exhaustion of copyright’, (1993) RIDA, 157, 50. Samuelson P. ‘The past, present and future of software copyright interoperability rules in the European Union and United States’, (2012) EIPR, 34, 229. Schneider, J. and G. Spindler, ‘Der Kampf um die gebrauchte Software – Revolution im Urheberrecht?’ (2012) Computer und Recht, 489–98. Targosz, T. ‘Exhaustion in digital products and the “accidental” impact on the balance of interests in copyright law, in L. Bently, U. Suthersanen and P.L.C. Torremans (eds), Global Copyright, Three Hundred Years Since the Statute of Ann from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010. Tjong Tjin Tai, E. ‘Exhaustion and online delivery of digital works’, (2003) EIPR, 207. Vinje, T., V. Marsland, and A. Gärtner, ‘Software licensing after Oracle v. UsedSoft. Implications of Oracle v. UsedSoft (C-128/11) for European copyright law’, (2012) Computer Law Review International Issue 4, 97–102. von Lewinski S., ‘International exhaustion of the distribution right under EC copyright law’, (2005) EIPR, 27, 233. Wiebe, A. ‘The economic perspective: exhaustion in the digital age’, in L. Bently, U. Suthersanen and P.L.C. Torremans (eds), Global Copyright, Three Hundred Years Since the Statute of Ann from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010.

ARTICLE 5: EXCEPTIONS TO THE RESTRICTED ACTS 1.

In the absence of specific contractual provisions, the acts referred to in points (a) and (b) of Article 4(1) shall not require authorisation by the rightholder where they are necessary for the use of the computer program by the lawful acquirer in accordance with its intended purpose, including for error correction.

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2. 3.

The making of a back-up copy by a person having a right to use the computer program may not be prevented by contract in so far as it is necessary for that use. The person having a right to use a copy of a computer program shall be entitled, without the authorisation of the rightholder, to observe, study or test the functioning of the program in order to determine the ideas and principles which underlie any element of the program if he does so while performing any of the acts of loading, displaying, running, transmitting or storing the program which he is entitled to do.

II. COMMENTARY 1. General remarks A. (Non?) Exhaustive character of the list of exceptions 5.98 Article 5 as well as Article 6 enumerates certain forms of use that can be made of computer programs without infringing the exclusive rights. In line with the rule for general copyright exceptions,155 these exceptions must also be given a restrictive interpretation156 and even – in contrast to general exceptions – have a mandatory character.157 5.99 It is not entirely clear whether this list of exceptions is exhaustive as legislative documents contradict each other.158 In line with Recital 19, it is assumed that where certain legitimate uses have been carefully defined in the Directive, as is the case in relation to the making of a back-up copy or the acts of decompilation, Member States are not allowed to extend such particular use.159 Adding to the list other forms of legally authorised uses would, on the other hand, seem possible.160 One could think, for example, of a limitation allowing the use of computer programs for the sole purpose of illustration for teaching or for the purpose of public security.161

B. The ‘lawful acquirer’ or ‘person having a right to use’ 5.100 The exercise of the exceptions is subject to the condition that the use is made by the ‘lawful acquirer’ (art. 5(1)) or ‘a person having a right to use’ (art. 5(2) and (3) as well as art. 6). This terminology can be compared with the requirement of ‘lawful user’ and ‘lawful use’ used in other Directives such as Directive 96/9 on databases and Directive 2001/29. In the preparatory documents no explanation is given for the terminological differentiation. 5.101 In its SAS Institute decision the CJEU seems to promote a unifying interpretation of the concept of a lawful user but, unfortunately, the Court did not address this issue in much detail. Also several Member States have transposed the notion ‘lawful acquirer’ by using the term ‘lawful user’ i.e., a person having a right to use the program.162 On the other hand, it cannot be denied that from a

155 156

157 158

159 160 161 162

Case C-5/08 Infopaq International A/S v Danske Dagblades Forening [2009] ECR I-6569, paras 162–3. Case T-19/07 Systran SA and Systran Luxembourg SA v European Commission [2010] ECR II-06083 (this judgment was annulled by the CJEU for infringement of jurisdiction rules in Case C-103/11 Commission v Systran SA and Systran Luxembourg SA). See also para. 5.110. See Art. 8. Recital 19 stating that the Directive ‘does not affect derogations provided for under national legislation in accordance with the Berne Convention on points not covered by this Directive’ is difficult to align with Recitals 32 and 50 of Dir. 2001/29. Bently, 226; Blocher and Walter, 159–60. S. Dusollier, ‘Protection des programmes d’ordinateur’, in Kaesmacher, D. (ed.), Les Droits intellectuels, Larcier, Bruxelles, 2007, 361, n 412. Hugenholtz et al., 65. Explanatory Memorandum 1989, 12.

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linguistic point of view as well as on the legal level the two notions may entail different consequences.163 The concept of ‘lawful acquirer’ is to be understood as to cover a purchaser, renter, licensee from the 5.102 right holder as well as – this can be seen as an accessory to the rule of exhaustion – persons who purchase copies which have been legitimately brought into circulation.164 In line with this view the CJEU ruled that, in a situation where the copyright holder’s right to object to the resale of a copy of a computer program has been exhausted, a second acquirer of that copy and any subsequent acquirer are to be considered ‘lawful acquirers’.165 It remains unclear whether, with regard to the scope of the exception of Article 5, subcontracting is permitted which would then make the sub-contractor a lawful acquirer.166

2. Acts necessary for normal use and error correction While, on the one hand, the legislator decided to include acts of loading, viewing, running, 5.103 transmitting or storing the program in the scope of the exclusive right of reproduction, on the other hand, an exception has been provided that where such acts are only carried out for the purpose of using the program and do not result in a second permanent replication of the program, they should be taken as not requiring express authorisation of the right holder.167 The justification for this limitation is that, unlike other forms of literary work, a computer program cannot serve its purpose unless certain temporary copying, moving and storing operations are performed which leave, however, no trace once the operation of the machine has terminated. The exception is subject to various cumulative conditions: (1) there should be no contractual 5.104 provision to the contrary; (2) only the acts mentioned in Article 4(a) (reproductions) and (b) (alterations) are allowed; (3) only acts that are necessary for the use of the computer program or for correction of errors may be performed; (4) the use of the program should be in accordance with its intended purpose; and (5) such acts can only be performed by a ‘lawful acquirer’.168 The exception is secondary to a deviating contractual regulation. The lawfulness of such a provision 5.105 should, however, be assessed in the light of Recital 13 stating that ‘the acts of loading and running necessary for the use of a copy of a program (and) the act of correction of its errors, may not be prohibited by contract’. In this Recital ‘the European Union legislature was at pains to make clear’ that contracting out in relation to the mentioned acts is not to be allowed.169 Conversely, necessary acts of reproduction in situations other than loading, running and error correction may still be prohibited by contract which is also confirmed in the further text of Recital 13 and in the Review Report.170 Doctrine, however, challenges the enforceability of contractual conditions which the acquirer only learns about after opening the wrapping.171 The binding nature of these so-called ‘shrink-wrap licences’ will have to be assessed under national contract law.

163 164 165 166

167 168 169 170 171

See details in Bently, 227 and Bing, 416. Commission Report 2000, 12; L. Guibault and O. van Daalen, ‘Unravelling the Myth Around Open Source Licenses – An Analysis from a Dutch and European Law Perspective, TMC Asser Press, The Hague, 2006, 72; Bently, 227. Case C-128/11 UsedSoft, paras 80–81 and 85. This should be possible according to Commission Report 2000, 10 and Opinion AG Cruz Villalón in Case C-103/11 Systran SA and Systran Luxembourg SA v European Commission, para. 126. Cf., on the condition that such conduct is contractually authorised, Blocher and Walter, 148. Explanatory Memorandum 1989, 25–6. For criticism on such a ‘circular approach’, see Lucas and Lucas, 412. See on this latter condition, supra, paras 5.94 ff. Opinion AG Bot in Case C-406/10 SAS Institute, para. 96. Commission Report 2000, 12. Blocher and Walter, 152; Bently, 227. See also Explanatory Memorandum 1989, 27.

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5.106 The act of reproduction should be necessary for the use of the program in accordance with its intended purpose. Recital 13 clarifies that the exception aims at allowing reproductions which are ‘technically’ necessary. The reproduction or alteration should be practically necessary as opposed to absolutely essential or merely convenient.172 When a customer purchases a copy of a computer program that is on the right holder’s website, he performs, by downloading the copy onto his computer, a reproduction that is necessary for the use of the program.173 Similarly, in the event of a resale of the copy of the computer program purchased and downloaded by the first acquirer from the rightholder’s website, the new acquirer of that copy, when he is a lawful acquirer, is also entitled, to download that copy onto his computer, since that download constitutes a reproduction that is necessary to enable him to use that program in accordance with its intended purpose.174 5.107 The allowed acts should be necessary for uses in accordance with the intended purpose of ‘that’ computer program. The determination of what exactly the purpose of a program includes will involve a factual assessment in individual cases which should be left to the national courts. The text seems to refer to the purpose of the contract subjectively as it was ‘intended by the parties’. It is, however, argued that this purpose may also be determined in a more objective way, taking into account factors such as the cost and the inherent character and structure of the program or the way the product has been advertised to the purchaser.175 5.108 Article 5(1) authorises error correction without defining what may constitute an error. What may be identified as an ‘error’ by the user may in fact be intended as a feature by the owner. It is generally understood that the possibility to correct errors should not be interpreted in a too broad sense. It would allow the removal so-called ‘bugs’ or errors in the style of the famous ‘Y2K problem’,176 but does not allow changes to the program in order to ‘maintain’ it or keep it up to date.177

3. Making of back-up copy 5.109 In contrast with exceptions to ordinary literary works, it was the clear intention of the EU legislator to exclude private copying of computer programs from the scope of permissible exceptions.178 Only the making of a back-up copy is authorised on the condition that it is done by a person having a right to use the computer program and insofar as it is necessary for that use. 5.110 The notion ‘back-up’ is intended to mean ‘for security reasons’.179 Whether such a copy is necessary may depend on a variety of considerations, such as the stability of the medium on which the program is embodied or the availability of a sufficiently accessible and reliable online-help desk.180 Furthermore, it results from the wording (‘a’ copy) and the objective of Article 5(2) that only one copy is permitted if necessary. The back-up copy exception merely aims to ensure that normal use of the program can continue in the event of loss or defect of the original. This narrow interpretation is criticised by legal scholars who cite examples of situations where the production of several copies may be technically necessary.181

172 173 174 175 176 177 178 179 180 181

Bently, 226. Case C-128/11 UsedSoft, para. 75. Ibid., paras 80–81. Blocher and Walter, 153–4; Bently, 226–7 with reference to OLG Karlsruhe 1 October 1996, case 6 U 40/95 (Dongle) (1996) IIC 740. This ‘Year 2000 problem’ related to programs whereby dates were allotted two digits and not four which created many problems at the time of the turn of the century. For details on ‘error correction’, see Blocher and Walter, 154–5 and Bently, 226. Commission Report 2000, 6 and 13. Ibid, 18. Bently, 228. See Bing, 418–19 and Blocher and Walter, 156.

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While an initial acquirer of a copy of a computer program may make a back-up copy in the case 5.111 where the original material medium of the copy that was initially delivered to him has been damaged, destroyed or lost, he may however not provide this back-up copy to a new acquirer without the authorisation of the rightholder. Consequently, the lawful acquirer of a copy of a computer program accompanied by an unlimited user licence will need the right holder’s consent to transfer his back-up copy of that program to a new acquirer, in spite of the occurrence of exhaustion of that right holder’s distribution right.182 In this case Ranks, the Court of Justice thus distinguished the (exhaustible) distribution right from the (non-exhaustible) right of reproduction. This decision is understandable as it is in the interest of the subsequent lawful acquirer of a used licence that the copy of a computer program (s)he acquires is not tampered with and corresponds to his/her (security) expectations.

4. Observing, studying or testing the functioning of the program Many ideas behind a program are discoverable simply by examining the data entering into the 5.112 software (i.e., inputs) and comparing it to the data coming out of the software, or by reaching some function performed by the computer such as printing (i.e., outputs). Merely observing how the software interacts with other software or computer devices may be sufficiently explanatory to reproduce the ideas behind the program, notwithstanding the fact that internal details remain concealed inside a black box.183 This type of activity, known as ‘black-box testing’ is what this exception aims at allowing.184 Article 5(3) extends to the user the non-waivable right to analyse the program to the full extent desired, but the means by which he may do so are limited; he may not retranscribe the object code of the program into source code permitting an exhaustive analysis of the program.185 The purpose of Article 5(3) is clear. The acts of observing, studying or testing the functioning of a 5.113 computer program serve to determine the ideas and principles which underlie any element of the program.186 This exception can thus be seen as an implementation of the fundamental axiom of copyright law, reiterated in Article 1(2). Hence, competitors remain free to create their own implementation of the ideas, rules or principles which they have established through independent black-box analysis in order to make compatible products as long as they do not use the same expression.187 The ending phrase ‘if he does so while performing any of the acts of loading, displaying, running, 5.114 transmitting or storing the computer program’ aims at ensuring appropriate limitation of the permitted acts.188 The mentioned acts include the acts for which that person has obtained authorisation from the right holder as well as the acts of loading and running necessary in order to use the computer program in accordance with its intended purpose.189

182 183 184

185

186 187

188 189

Case C-166/15 Ranks and Vasiļevicˇs, paras 43–4 and 57. C. Guillou, ‘The reverse engineering of computer software in Europe and the United States: A comparative approach’, (1997–8) Colum.-VLA JL and Arts, 22, 533, 535. See Recital 14; see also A. Palmer and Th. Vinje, ‘The EC Directive on the legal protection of computer software: New law governing software’, (1992) Duke Journal of Comparative and International Law, 2, 65, 74 and 78; P. Samuelson, ‘The past, present and future of software copyright interoperability rules in the European Union and United States’, (2012) EIPR, 34, 229, 231. Huet and Ginsburg, ‘Computer programs in Europe: A comparative analysis of the 1991 EC Software Directive’, (1992) Colum J Transnat’l L, 30, 327, 358. For criticism to this ‘obvious’ exception – copyright law does not purport to restrict intellectual access to a work – see Lucas and Lucas, no 414. Case C-406/10 SAS Institute, paras 50–51. Explanatory Memorandum 1989, para. 3.12; Case C-406/10 SAS Institute, para. 59 and ruling 2. It was decided in this case that the lawful acquirer of the licence did not have access to the source code of the computer program to which the licence related, but merely studied, observed and tested the program in order to reproduce its functionality in a second program. Commission Report 2000, 13. Case C-406/10 SAS Institute, paras 54–5; Opinion AG Bot in Case C-406/10 SAS Institute, paras 95–7.

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NOTES 1. Related instruments See references to documents of legislative history in Notes to section ‘Preliminary Observations’. Directive 96/9 of the European Parliament and of the Council of 1 March 1996 on the legal protection of databases (Article 6), OJ L 77, 27.3.1996. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167, 22.6.2001. See also references to documents of legislative history in Notes to section ‘Preliminary Observations’.

2. CJEU case law Aleksandrs Ranks and Jurijs Vasiļevicˇs v Finanšu un ekonomisko noziegumu izmeklēšanas prokoratūra and Microsoft Corp (Case C-166/15) [2016] ECR I-0000, 12 October 2016, EU:C:2016:762 Infopaq International A/S v Danske Dagblades Forening (Case C-5/08) [2009] ECR I-6569 SAS Institute Inc v World Programming Ltd (Case C-406/10) [2012] ECR I-0000, 2 May 2012, EU:C:2012:259 Systran SA and Systran Luxembourg SA v European Commission (Case T-19/07) [2010] ECR II-06083 (judgment annulled by the CJEU for infringement of jurisdiction rules in Case C-103/11 Commission v Systran SA and Systran Luxembourg SA) UsedSoft GmbH v Oracle International Corp (Case C-128/11) [2012] ECR I-0000, 3 July 2012, EU:C:2012:407

3. Bibliography Bing, J. ‘Copyright protection of computer programs’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009. Blocher, W. and M. Walter, ‘Computer Program Directive’, in Walter, M. and S. Von Lewinski (eds), European Copyright Law, A Commentary, Oxford University Press, New York, 2010. Dusollier, S. ‘Protection des programmes d’ordinateur’, in Kaesmacher, D. (ed.), Les droits intellectuels, Larcier, Bruxelles, 2007. Guibault, L. and O. van Daalen, Unravelling the Myth Around Open Source Licenses – An Analysis from a Dutch and European Law Perspective, TMC Asser Press, The Hague, 2006. Guillou, C. ‘The reverse engineering of computer software in Europe and the United States: A comparative approach’, (1997–98) Colum.-VLA JL and Arts, 22, 533. Huet, J. and J. Ginsburg, ‘Computer programs in Europe: A comparative analysis of the 1991 EC Software Directive’, (1992) Colum J Transnat’l L, 30, 327. Hugenholtz, B. et al. ‘The recasting of copyright and related rights for the knowledge economy’, Study Commissioned by the European Commission, 2006, https://www.ivir.nl/publicaties/download/IViR_Recast_Final_Report_ 2006.pdf (accessed 30 March 2020). Lucas, A., H-J. Lucas and A. Lucas-Schloetter, Traité de la Propriété Littéraire et Artistique, 4th ed., LexisNexis, Paris, 2012. Palmer, A. and Th. Vinje, ‘The EC Directive on the legal protection of computer software: New law governing software’, (1992) Duke Journal of Comparative and International Law, 2, 65. Samuelson, P. ‘The past, present and future of software copyright interoperability rules in the European Union and United States’, (2012) EIPR, 34, 229.

ARTICLE 6: DECOMPILATION 1.

The authorisation of the rightholder shall not be required where reproduction of the code and translation of its form within the meaning of points (a) and (b) of Article 4(1) are indispensable to obtain the information necessary to achieve the interoperability of an independently created computer program with other programs, provided that the following conditions are met:

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2.

3.

(a) those acts are performed by the licensee or by another person having a right to use a copy of a program, or on their behalf by a person authorised to do so; (b) the information necessary to achieve interoperability has not previously been readily available to the persons referred to in point (a); and (c) those acts are confined to the parts of the original program which are necessary in order to achieve interoperability. The provisions of paragraph 1 shall not permit the information obtained through its application: (a) to be used for goals other than to achieve the interoperability of the independently created computer program; (b) to be given to others, except when necessary for the interoperability of the independently created computer program; or (c) to be used for the development, production or marketing of a computer program substantially similar in its expression, or for any other act which infringes copyright. In accordance with the provisions of the Berne Convention for the protection of Literary and Artistic Works, the provisions of this Article may not be interpreted in such a way as to allow its application to be used in a manner which unreasonably prejudices the rightholder’s legitimate interests or conflicts with a normal exploitation of the computer program.

II. COMMENTARY 1. General Article 6 regulates the highly controversial issue190 of decompilation (also referred to as reverse 5.115 engineering) of computer programs. Decompilation is the act whereby a programmer disassembles software to translate the object code, a machine-readable language which is indecipherable to the user, into intelligible source code, or more precisely into a form of source code (‘pseudo source code’191). These acts are only allowed for the purpose of achieving interoperability of programs. Article 6 responds to two major problems that reverse engineering attempts to address;192 5.116 communication between (components of) other systems, including those of different manufacturers, so that they can work together; and creation of systems that are compatible with the standards imposed by the marketplace. For such purposes a reproduction of the code and translation of its form may be indispensable to obtain the necessary information to achieve the interoperability of an independently created program with these other systems.

2. Conditions of the exception Decompilation has been construed as a very narrow right and may be contemplated only in very 5.117 specific circumstances.193 Moreover, because Article 6 constitutes an exception to the exclusive copyright it is to be interpreted strictly.194

190 191 192 193 194

See para. 5.01. For more details, see Samuelson, 229; Spoor, 1063 and Weichselbaum, 1026. See Bing, 424 who notes that decompilation may be less of a solution than seen at first glance because ‘the code obtained may be quite a jumble and requires considerable skill and time to analyse’. See, in particular, Recitals 9, 10, 15 and 18. Recital 15. Opinion AG Bot in Case C-406/10 SAS Institute, para. 85.

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A. Only limited acts of reproduction (art. 6(1)) 5.118 While working backward from the object code and decompiling it into source code, the decompiler may only perform acts of reproduction of the code and translation or adaptation of its form within the meaning of point (a) and (b) of Article 4(1).

B. Aim of interoperability (art. 6(1)) 5.119 Decompilation is not allowed as such, but is permitted only to the extent that it is necessary for establishing interoperability.195 Interoperability can be defined as the ability to exchange information between programs and mutually to use the information which has been exchanged.196 It allows one program to link into another program. What is of relevance is the functional interconnection and interaction between software and hardware.197

C. Acts are indispensable and necessary to achieve interoperability (art. 6(1)) 5.120 Only acts of reproduction which are indispensable in obtaining information may be performed. Moreover, such a process may only be used to obtain the information necessary to achieve interoperability between elements of different computer programs. The use of the terms ‘indispensable’ and ‘necessary’ illustrates the desire of the EU legislature to make decompilation an exceptional act.198 According to its literal meaning ‘indispensable’ means that the information is absolutely necessary and cannot be neglected.199 This requirement should also be understood in the sense that decompilation is the only way of obtaining the information, implying that the user has exhausted all other avenues for achieving interoperability.200 The decompiler will have to demonstrate this absolute necessity.201 D. Interoperability with an independently created program (art. 6(1)) 5.121 The sole aim of the decompilation should be to achieve interoperability of an ‘independently created computer program’ with other programs. This condition was added to ensure that any decompilation of a target program does not occur before the independently created program exists (even if only in preparatory design material form).202 Therefore, the exception will not apply in cases where decompilation is performed solely to gain information of the decompiled program. On the other hand, there is no restriction regarding the identity of the program with which the decompiler’s program will be interoperative and, hence, this can be any program.203

E. Acts performed by a licensee or other legitimate user (art. 6(1)(a)) 5.122 Only three groups of persons are entitled to invoke the exception, i.e., (1) a licensee, (2) any other person having a right to use the program204 and (3) any person who has been authorised to do so on behalf of a licensee or a legitimate user. So clearly ‘hackers’ or persons in possession of illegal copies cannot invoke the exception.

195

196 197 198 199 200 201 202 203 204

It is noteworthy that the Directive does not specifically permit decompilation for the purpose of research. Whether this is intended or simply an omission is not clear. Of course, Art. 5(3) may fill this gap but black-box analysis may sometimes prove insufficient and the absence of an explicit authorisation to decompile for purposes of research, as exists in the US, is to be regretted. See also para. 5.23. Copyright Review Paper 2004, 9. Opinion AG Bot in Case C-406/10 SAS Institute, para. 87. http://www.merriam-webster.com/dictionary. Bently, 231. Opinion AG Bot in Case C-406/10 SAS Institute, para. 87. Commission Report 2000, 14. Huet and Ginsburg, 362; Bently, 230–1. See on this concept, supra, paras 5.94 ff.

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F. The necessary information is not readily available (art. 6(1)(b)) Decompilation is not allowed if the necessary information has been made available in some way. 5.123 One could think of instruction manuals. According to the text, the information should not be ‘readily available’.205 Other language versions of the text are more explicit where they use the wording ‘quickly and easily available’.206 The Directive fails to indicate how this requirement is to be construed. It clearly does not impose an obligation on right holders to make adequate documentation on the technical specifications of the interfaces available. At the most, this provision could be read as an implicit invitation to do so, should they want to exclude the application of the exception.207 Where the text states that the information may not be ‘previously’ available, it is assumed that 5.124 the user should not approach or negotiate with the right holder to obtain the information, but this proposition is disputed.208 Controversy also remains with respect to the question whether the disclosing producer may demand a reasonable fee for the disclosure.209 Anyhow, should the right holder refuse to communicate interface specifications, application of competition law principles might compel him to disclose such information, as was made clear in the Microsoft case.210

G. Only decompilation of necessary parts (art. 6(1)(c)) This requirement should be read together with the first part of Article 6 that only allows for 5.125 particular reproduction acts to obtain information that is necessary to achieve interoperability. According to section (c) these acts of decompilation should be confined to the parts of the original program which are necessary for such interoperability. This limitation serves to reassure right holders that, while searching for interface information, users do not take advantage of this possibility to decompile the whole code.211 This restriction is, however, impractical and probably difficult to enforce. Indeed, as the original program is only available in object code, it is nearly impossible for the decompiler to determine in advance which portion of the code contains the valuable ‘interoperable’ information. It may then be necessary to decompile more than just the program code, or even the entire program which implements a particular interface.212 H. No use of the information obtained for other purposes (art. 6(2)) To strike a balance with the rights of copyright owners and to combat misuse of reverse engineering, 5.126 Section 2 includes a safety clause that puts strict limits on the types of use that are allowed. These conditions can be seen as specific obligations on the decompiler; yet their nature (as a condition for the operation, a defence of decompilation or a distinct legal obligation?) remains unclear. In particular, the information may not be used (a) for goals other than to achieve the interoperability 5.127 of the independently created computer program (b) to be given to others, except when necessary for the interoperability of the independently created computer program, or (c) for the development, production or marketing of a computer program with a substantially similar expression or for any other act which infringes copyright.

205 206 207 208 209 210 211 212

Cf the German version ‘ohne weiteres’. See, e.g., the French version ‘facilement et rapidement’; the Spanish version ‘de manera fácil y rápida’ and the Dutch version ‘snel en gemakkelijk’. Cf Bing, 424. Blocher & Walter, 174. Pro (obligation to ask): Czarnota and Hart, 80. Contra: Vinje, 257; Bently, 231. Blocher and Walter, 174. Pro: Huet and Ginsburg, 371. See para. 5.139. Bently, 231–2. M. Colombe and C. Meyer, ‘Interoperability still threatended by EC Software Directive: A status report’, (1990) EIPR, 9, 325; Bently, 232; Bing, 423. See also Huet and Ginsburg who qualify this condition as ‘artificial and futile’ (363–4).

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5.128 This last restriction follows from copyright logic. If reverse engineering results in a duplication or substantially similar copy of the program, it is normal that such a use should be subject to the right holder’s consent. It is, however, unclear how the ‘substantial similarity test’ has to be performed and different interpretations in the Member States are likely awaiting the articulation of a uniform standard.213 5.129 On the other hand, it is understood that decompilation may be performed to produce ‘competing’ (i.e., as an alternative to the original) as well as ‘attaching’ computer programs as long as their expression is substantially different.214 5.130 Finally, the condition stating that the information may not be used for ‘any other act which infringes copyright’ will be satisfied where, as was discussed in SAS Institute, the lawful acquirer of the licence did not have access to the source code of the computer program to which that licence relates, but merely studied, observed and tested that program in order to reproduce its functionality in a second program. In such case the copyright in the computer program can indeed not be infringed.215

I. Subject to the ‘three-step’ test (art. 6(3)) 5.131 With reference to the Berne Convention, Article 6(3) requires that its provisions not be interpreted in such a way as to allow its application to be used in a manner which unreasonably prejudices the right holder’s legitimate interests or conflicts with a normal exploitation of the computer program.216 5.132 References to the ‘three-step’ test have become a standard formulation that can be found in all later copyright Directives.217 A puzzling question is why this test only applies to acts of decompilation and not to any other acts covered by other limitations under the Directive? The Commission refers to the concern of the legislator that the decompilation exception ‘could lead to unreasonable detriment to the right holder’.218 This is barely convincing because all Member States are anyhow bound by the provisions of the Berne Convention which relate to all exceptions. Therefore it seems that no special interpretation should be given to this section 3 of Article 6. 5.133 Logically, the prohibition that the decompilation exception may not be used in a manner which conflicts with a normal exploitation of the computer program would bar the use of information obtained through reverse engineering for the purpose of developing a competing program. However, as indicated above,219 the decompilation exception was precisely defined as to include this possibility and priority should therefore be given to this intention of the legislator.

NOTES 1. Related instruments See references to documents of legislative history in Notes to section ‘Preliminary Observations’.

213 214 215 216 217 218 219

Guillou, 544. Goldstein and Hugenholtz, 386; Guillou, 543. Case C-406/10 SAS Institute, paras 60–61. This intent is also confirmed in Recital 15. Yet, the European legislator rather seems to anticipate Art. 13 TRIPs which also, and contrary to the Berne provision, refers to the interests of the right holder rather than the author’s. As regards inconsistency in scope and formulation as well as uncertainty with respect to the intended addressee, see Hart, 169 and Hugenholtz et al., 70. Commission Report 2000, 13. See para. 5.109.

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ARTICLE 7: SPECIAL MEASURES OF PROTECTION

2. CJEU case law SAS Institute Inc. v World Programming Ltd (Case C-406/10) [2012] ECR I-0000; 2 May 2012, EU:C:2012:259.

3. Bibliography Bently, L. ‘Computer Programs Directive’, in Dreier, T. and B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law Intern., The Netherlands, 2006. Bing, J. ‘Copyright protection of computer programs’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009 Blocher, W. and M. Walter, ‘Computer Program Directive’, in Walter, M. and S. Von Lewinski (eds) European Copyright Law, A Commentary, Oxford University Press, New York, 2010. Colombe, M. and C. Meyer, ‘Interoperability still threatened by EC Software Directive: A status report’, (1990) EIPR, 9, 325. Czarnota, B. and R.J. Hart, Legal Protection of Computer Programs in Europe. A Guide to the EC Directive, Butterworths, London, 1991. Goldstein, P. and B. Hugenholtz, International Copyright. Principles, Law and Practice, 3rd ed., Oxford University Press, USA, 2013. Guillou C. ‘The reverse engineering of computer software in Europe and the United States: A comparative approach’, (1997–98) Colum.-VLA J.L. & Arts, 22, 533. Hart, M. ‘The proposed Directive for copyright in the information society: Nice rights, shame about the exceptions’, (1998) EIPR, 169. Huet, J. and J. Ginsburg, ‘Computer programs in Europe: A comparative analysis of the 1991 EC Software Directive’, (1992) Colum J Transnat’l L, 30, 327. Hugenholtz, B. et al., ‘The recasting of copyright and related rights for the knowledge economy’, Study Commissioned by the European Commission, https://www.ivir.nl/publicaties/download/IViR_Recast_Final_Report_ 2006.pdf (accessed 30 March 2020). Samuelson, P. ‘The past, present and future of software copyright interoperability rules in the European Union and United States’, (2012) EIPR, 34, 229. Spoor, J. ‘Copyright protection and reverse engineering of software: Implementation and effects of the EC Directive’, (1994) Dayton Law Review, 19, 1063. Vinje, T. ‘Die EG-Richtlinie zum Schutz von Computerprogrammen und die Frage der Interoperabilität’, (1992) GRUR Int., 250. Weichselbaum, M. ‘The EEC Directive on the legal protection of computer programs and U.S. copyright law: Should copyright law permit reverse engineering of computer programs’, (1990) Fordham International Law Journal, 14, 1026.

ARTICLE 7: SPECIAL MEASURES OF PROTECTION 1.

2.

Without prejudice to the provisions of Articles 4, 5 and 6, Member States shall provide, in accordance with their national legislation, appropriate remedies against a person committing any of the following acts: (a) any act of putting into circulation a copy of a computer program knowing, or having reason to believe, that it is an infringing copy; (b) the possession, for commercial purposes, of a copy of a computer program knowing, or having reason to believe, that it is an infringing copy; (c) any act of putting into circulation, or the possession for commercial purposes of, any means the sole intended purpose of which is to facilitate the unauthorised removal or circumvention of any technical device which may have been applied to protect a computer program. Any infringing copy of a computer program shall be liable to seizure in accordance with the legislation of the Member State concerned.

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3.

Member States may provide for the seizure of any means referred to in point (c) of paragraph 1.

II. COMMENTARY 1. General remarks 5.134 Article 7(1) specifies three different acts against which the Member States have to provide appropriate remedies. The following sections (2) and (3) contain rules on seizure of infringing copies and circumvention devices. 5.135 Although there existed a need for a broad-based set of minimum standards and procedures for copyright remedies to implement the TRIPs Agreement, the Directive only includes provisions which are general in their requirements. The Member States have to provide ‘appropriate remedies’ the interpretation of which is left to their national legislation. It should, however, be borne in mind that issues of overall harmonisation of copyright remedies and combating piracy have in the meantime been addressed in the context of Directive 2004/48 on enforcement of intellectual property rights.

2. Particular remedies and sanctions A. Putting into circulation (art. 7(1)(a)) 5.136 Appropriate measures must be provided against persons who put into circulation a copy of a computer program knowing, or having reason to believe, that it is an infringing copy.220 5.137 The Explanatory Memorandum explains that: the ease with which unauthorized copies of programs can be transferred electronically from one ‘host’ computer to another, across national borders and without trace, requires that the importation and possession of infringing copies should (…) be actionable as should be all dealing with infringing copies in the sense of selling, offering for sale, receiving, transmitting and storing such copies.221

The wording ‘putting into circulation’ should be understood to cover at least these acts. It may possibly also cover rental.222 5.138 The special measures that Member States have to provide and that should be understood as complementary measures are only prescribed in case of qualified infringement.223 The condition of ‘knowledge’ can probably be equated with the wording used in Article 6 Directive 2001/29, which refers to persons carrying out acts ‘in the knowledge, or with reasonable grounds to know’.

B. Possession for commercial purposes (art. 7(1)(b)) 5.139 The right holder can take action against any person who is found in the possession of a copy of a computer program knowing, or having reason to believe, that it is an infringing copy. While the mere possession of copies is not included in the restricted acts, this act may be regarded as an

220 221 222 223

Case C-166/15 Ranks and Vasiļevicˇs, paras 46–47. See also commentary to Art. 4.2. Explanatory Memorandum 1989, para. 29. Bently, 234. Blocher and Walter, 199–200.

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ARTICLE 7: SPECIAL MEASURES OF PROTECTION

infringement but only if the possession is ‘for commercial purposes’. This not only includes possession with a view to sale or rental for profit but also use within an undertaking.224

C. Protection for technological protection measures (art. 7(1)(c)) It is an infringement to put into circulation, or to possess for commercial purposes, any means the 5.140 sole intended purpose of which is to facilitate the unauthorised removal or circumvention of any technical device which may have been applied to protect a computer program. This act does not presuppose intention or negligence, as long as the articles concerned are specifically intended to facilitate the removal or circumvention of any protective technical means. It is not required either that the device be incorporated into the program. It is sufficient that it protects the program, e.g. by way of inclusion of protection measures in the hardware that uses the program.225 The wording ‘any means’ seems to merit a broad scope of application. This is important as Article 7 5.141 does not target the act of circumvention per se. This broad scope is, however, curtailed by the phrase that the sole intended purpose of such means should be to facilitate unauthorised removal or circumvention of a technical device. This is a much higher standard than the condition, in Article 6(2)(c) of Directive 2001/29 that the device is ‘primarily designed for the purpose of circumvention’. Also the restriction to technical devices contrasts with the elaborated concept and definition of ‘technological measures’ as contained in Article 6 of Directive 2001/29.226 What is particularly unfortunate is the impossibility of applying these more generous provisions to computer programs as this is clearly precluded by Article 1 and Recital 50 of the latter Directive. This leads to an inconsistent treatment, which becomes more and more problematic in times of the ongoing convergence of media and formats. As regards the interplay between liability for circumvention and exceptions, it is advocated that the 5.142 prohibition on distribution and possession of circumvention means continues to apply also in the case whereby the circumvention is done in order to exercise an exception.227

3. Seizure Sections (2) and (3) require Member States to provide for a specific enforcement measure, namely 5.143 seizure of infringing copies and seizure of means permitting facilitating the unauthorised removal or circumvention of technical protection devices. These seizure provisions only relate to the infringing object (infringing copy of a computer program or circumventing means). There is no restriction as to the identity of the person that may be subjected to the seizure. Thus, illegal copies can be seized with the infringer as well as with any other person. There is also no restriction as to a qualified possession. The procedure by which seizure can be performed and the conditions under which such procedures 5.144 are available, is left to national law. These laws need to be in compliance with the requirements regarding seizure that are contained in Articles 7 and 9 of Directive 2004/48 on enforcement of intellectual property rights.

224

225 226

227

Cf the many actions initiated by the Business Software Alliance against companies that make use of infringing copies or which, at the least, are aware of the fact that their employees have installed unauthorised software copies on company computers. Kabushiki Kaisha Sony Computer Entertainment Inc v Ball [2004] EWHC 1738 (Ch); [2004] ECDR 33, 323; [2005] FSR 9; [2005] ECC 24. E.g. the Finnish Supreme Court decided that written instructions which enabled a purchaser to install program updates did not amount to distribution of a device for circumventing the protection of the program; Adobe Systems Inc v A Software Distributor, 3 October 2003, [2004] ECDR (30) 303. Bently, 235. This was also confirmed in the Sony v Ball decision (supra, fn 206).

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Chapter 5 THE SOFTWARE DIRECTIVE

NOTES 1. Related instruments See references to documents of legislative history in Notes to section ‘Preliminary Observations’. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167, 22.6.2001. Directive 2004/48 of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights, OJ L 157, 30.4.2004. See also references to documents of legislative history in Notes to section ‘Preliminary Observations’.

2. CJEU case law Aleksandrs Ranks and Jurijs Vasiļevicˇs v Finanšu un ekonomisko noziegumu izmeklēšanas prokoratūra and Microsoft Corp (Case C-166/15) [2016] ECR I-0000, 12 October 2016, EU:C:2016:762.

3. Bibliography Bently, L. ‘Computer Programs Directive’, in Dreier, T. and B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law Intern., The Netherlands, 2006. Blocher, W. and M. Walter, ‘Computer Program Directive’, in Walter, M. and S. Von Lewinski (eds), European Copyright Law, A Commentary, Oxford University Press, New York, 2010.

ARTICLE 8: CONTINUED APPLICATION OF OTHER LEGAL PROVISIONS The provisions of this Directive shall be without prejudice to any other legal provisions such as those concerning patent rights, trade-marks, unfair competition, trade secrets, protection of semi-conductor products or the law of contract. Any contractual provisions contrary to Article 6 or to the exceptions provided for in Article 5(2) and (3) shall be null and void.

II. COMMENTARY 1. No prejudice to other forms of protection 5.145 The first paragraph of this Article contains a without prejudice clause in relation to other legal provisions affecting computer programs such as legislation on patents, trademarks, unfair competition, trade secrets, semi-conductor products or contracts. The Directive clearly does not exclude that, in appropriate cases, protection by the relevant laws in these disciplines is given, in concurrence with copyright, to other elements of the computer program.228 This is particularly relevant in the field of patent law where, notwithstanding the explicit exclusion of ‘a computer program as such’ as patentable subject matter, numerous patents are granted for so-called computer-implemented inventions.229

228

229

See, e.g. EPO Technical Board of Appeal, Case T117/97, IBM (‘The protection by copyright and patent constitute two different modes of protection which can nevertheless apply to the same object (i.e. a computer program) because each of them follows its own objective’). See general information and specific examiners’ guidelines in relation with such inventions on .

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ARTICLE 9: COMMUNICATION

The explicit reservation of the application of the competition rules, e.g. in the case where a 5.146 dominant supplier refuses to make information available which is necessary for interoperability as defined in this Directive,230 merits special attention. Its importance is best illustrated with reference to the Microsoft case where the European Commission handed down a decision concluding the abuse of a dominant position by Microsoft for not supplying interface information and imposing on this company enormous sanctions.231

2. Mandatory character of the exceptions The second paragraph specifies that any contractual provisions contrary to the exceptions provided 5.147 for by Article 5(2) and (3) with regard to the making of a back-up copy or to observation, study or testing of the functioning of a program or the provisions laid down in Article 6 in respect of decompilation are null and void.232 In other words, any contractual provisions that would purport to override these exceptions are not to be enforced.233 Although the text of Article 5(1) is misleading in this respect, it should be recalled also that use by the lawful acquirer of a computer program in accordance with its intended purpose cannot be waived completely.234

NOTES 1. Related instruments See references to documents of legislative history in Notes to section ‘Preliminary Observations’.

2. CJEU case law Microsoft v Commission (Case T-201/04) [2007] ECR II-03601. SAS Institute Inc. v World Programming Ltd (Case C-406/10) [2012] ECR I-000, 2 May 2012, EU:C:2012:259.

3. Bibliography Anderman, S. ‘Microsoft v Commission and the interoperability issue’, (2008) EIPR, 395. Béhar-Touchais, M. ‘Être interoperable ou ne pas être: telle est la question!’, (2008) Comm.com.életr., chron 6. Blocher, W. and M. Walter, ‘Computer Program Directive’, in Walter, M. and S. Von Lewinski (eds) European Copyright Law, A Commentary, Oxford University Press, New York, 2010.

ARTICLE 9: COMMUNICATION Member States shall communicate to the Commission the provisions of national law adopted in the field governed by this Directive.

230 231

232 233 234

Recital 17. Decision of 24 March 2004, case COMP/C 3–37.792, COM (2004) 900 final and publication of an extract in OJ L-32/23, 6 Feb. 2007. This decision was confirmed by the General Court in Case T-201/04 Microsoft v Commission [2007] ECR II-03601. See also Recital 16 and Case C-406/10 SAS Institute, paras 50–51. See, e.g. Cass. Com. 20 October 2011, RTD com. 2011, 760, obs. Pollaud-Dulian. See para. 5.99.

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Chapter 5 THE SOFTWARE DIRECTIVE

II. COMMENTARY 5.148 Article 10 of the initial 1991 version of the Directive prescribed that Member States should bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before 1 January 1993. Because all Member States had met this obligation by the time the current codified version was enacted,235 this first part of Article 10 has been repealed.236 5.149 The obligation to communicate national legislation, which is needed for the Commission to monitor whether Member States comply with the provisions of the Directive, is maintained and will, in particular, relate to modifications that they may introduce in their domestic law affecting the protection of computer programs. However, and in contrast to other Directives, this Directive does not contain an explicit obligation for the Commission to report on its findings to the Council and the European Parliament. As of today, only one report on the status and the effects of implementation has been published.237

NOTES 1. Related instruments Report of the Commission of 10 April 2000 on the implementation and effects of Directive 91/250/EEC on the legal protection of computer programs.

ARTICLE 10: REPEAL Directive 91/250/EEC, as amended by the Directive indicated in Annex I, Part A, is repealed, without prejudice to the obligations of the Member States relating to the time-limits for transposition into national law of the Directives set out in Annex I, Part B. References to the repealed Directive shall be construed as references to this Directive and shall be read in accordance with the correlation table in Annex II.

ARTICLE 11: ENTRY INTO FORCE This Directive shall enter into force on the 20th day following its publication in the Official Journal of the European Union.

II. COMMENTARY 5.150 The short term for the entering into force of the codified version of the Directive is not only common in European law but also obvious in view of the reality that all Member States had already implemented the Directive in its initial version by the time of the enactment of the current codified version.

235 236 237

See Part II. Commentary to Art. 11. See Art. 10. Commission Report 2000.

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ARTICLE 12: ADDRESSEES

The implementation deadline of the initial version was 1 January 1993. Only three Member States, 5.151 Denmark, Italy and the UK, could meet this deadline. By 1995, all the then 15 Member States had transposed the provisions of the Initial Directive into their national laws.238 For the countries that have acceded to the EU after the implementation deadline, compliance with the Directive has always been made a precondition to their accession.

ARTICLE 12: ADDRESSEES This Directive is addressed to the Member States.

II. COMMENTARY According to Article 249(3) of the EC Treaty, ‘a Directive shall be binding, as to the result to be 5.152 achieved, upon each Member State to which it is addressed, but shall leave to the national authorities the choice of form and methods’. By extension, Article 7 of the EEA Agreement imposes the same obligation on the Member States to this Agreement, i.e., EU States, Iceland, Liechtenstein and Norway. It remains thus a matter for the national legislator to decide how to implement the obligations in domestic law. Although the provisions of Directives are not directly applicable, it is settled case law that their 5.153 provisions may be given vertical direct effect once the deadline for transposition has passed on the condition that the Member State has not transposed the Directive by this deadline and that its provisions are unconditional and sufficiently clear and precise.239

NOTES 1. CJEU case law Criminal proceedings against Tullio Ratti (Case 148/78) [1979] ECR 1629. Yvonne van Duyn v Home Office (Case 41/74) [1974] ECR 1337.

238 239

Commission Report 2000, 7 (with dates of implementation by the individual countries). Case 41/74 Yvonne van Duyn v Home Office [1974] ECR 1337 and Case 148/78 Criminal proceedings against Tullio Ratti [1979] ECR 1629.

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6 THE RENTAL AND LENDING RIGHTS DIRECTIVE Sylvie Nérisson DIRECTIVE 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (codified version)

[2006] OJ L 376/28 I.

GENERAL REMARKS

6.01

ARTICLE 4: RENTAL OF COMPUTER PROGRAMS

CHAPTER I: RENTAL AND LENDING RIGHT

II. COMMENTARY

ARTICLE 1: OBJECT OF HARMONISATION

ARTICLE 5: UNWAIVABLE RIGHT TO EQUITABLE REMUNERATION

II. COMMENTARY 1. The exclusive rights 2. Originals and copies 3. The relation to the exhaustion of the distribution right

6.09 6.10 6.18 6.21

ARTICLE 2: DEFINITIONS II. COMMENTARY 1. Definitions A. Rental and lending: Making available for a limited period of time B. Rental versus lending: The criterion of direct or indirect economic or commercial advantage C. Establishments accessible to the public D. Film E. The undefined concepts 2. Authorship of the principal director

6.23 6.24 6.25

6.31 6.33 6.35 6.38 6.41

II. COMMENTARY 1. The unwaivability of the right to remuneration 2. The role to be played by collecting societies

6.58 6.59 6.64

ARTICLE 6: DEROGATION FROM THE EXCLUSIVE PUBLIC LENDING RIGHT II. COMMENTARY 1. Derogation from the exclusive right 2. Beneficiaries of the right to remuneration 3. The consideration of cultural promotion objectives 4. Exemption of certain categories of establishments

6.65 6.67 6.68 6.70 6.73

CHAPTER II: RIGHTS RELATED TO COPYRIGHT II. COMMENTARY

6.75

ARTICLE 7: FIXATION RIGHT

ARTICLE 3: RIGHTHOLDERS AND SUBJECT MATTER OF RENTAL AND LENDING RIGHT II. COMMENTARY 1. Beneficiaries and subject matter of the rental and lending right A. Beneficiaries B. Subject matter 2. The transferability of the exclusive right 3. Presumptions in favour of the film producer

6.55

6.43 6.44 6.44 6.48 6.50 6.51

II. COMMENTARY 1. The fixation right for performers 2. The fixation right for broadcasting organisations

6.77 6.78 6.81

ARTICLE 8: BROADCASTING AND COMMUNICATION TO THE PUBLIC II. COMMENTARY 1. Communication to the public 2. Equitable remuneration 3. Beneficiaries

6.83 6.86 6.91 6.96

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I. GENERAL REMARKS II. COMMENTARY

ARTICLE 9: DISTRIBUTION RIGHT II. COMMENTARY

6.99

6.106

ARTICLE 13: COMMUNICATION ARTICLE 14: REPEAL

ARTICLE 10: LIMITATIONS TO RIGHTS II. COMMENTARY

6.103

II. COMMENTARY

6.107

ARTICLE 15: ENTRY INTO FORCE

CHAPTER III: COMMON PROVISIONS

ARTICLE 16: ADDRESSEES

ARTICLE 11: APPLICATION IN TIME II. COMMENTARY

6.105

ARTICLE 12: RELATION BETWEEN COPYRIGHT AND RELATED RIGHTS

I. GENERAL REMARKS The Directive on rental right and lending rights and on certain related rights is originally from 6.01 1992. It was the first European legislative instrument dealing with actual authors’ rights and adopting a horizontal approach (as it is not concentrated on a specific object like Directive 91/250 on computer programs and as it provides all right holders of the creative chain with specific rights). The importance of this Directive goes beyond the right in the temporary making available of protected works and subject matters. It is a benchmark for the introduction of an unwaivable right to remuneration and the definition of the film director as an author of the film. It is also one of the few sources of an explicit justification in the applicable European copyright law: ‘The creative and artistic work of authors and performers necessitates an adequate income as a basis for further creative and artistic work, and the investments required particularly for the production of phonograms and films are especially high and risky’ (Recital 5). The Directive pursues two goals: to harmonise copyright law and to found this harmonisation on a 6.02 high level of protection.1 Indeed the sole wish to approximate the applicable law in the Common Market could definitely not justify the extent of the Directive. The choice of the exclusive right for the implementation of a rental right is the best example of this wish to set high standards of protection. The remuneration for rental was based on an exclusive right only in three States (out of the 12 of the EEC in 1992, namely Denmark, Italy and the UK).2 The need for the harmonisation of the rental issue was made clear by the ECJ in its decision 158/86 6.03 of 1988.3 The question the ECJ had to answer was: Must the provisions of […] the […] Treaty, on the elimination of quantitative restrictions between Member States, […], be interpreted as meaning that the owner of exclusive copyrights in a video-recording which is lawfully put into circulation by the owner of the exclusive right or with his consent in a Member State under whose domestic copyright law it is not possible to prohibit the (resale and) hiring-out of the recordings is prevented from restraining the hiring-out of the video-recording in another Member State into which it has been lawfully imported, where the copyright law of that State allows such prohibition without distinguishing between domestic and imported video-recordings and without impeding the actual importation of video-recordings?

1

2 3

See Follow up to the Green Paper, 1.4: The Commission will be guided by two principles here: first, the protection of copyright and neighbouring rights must be strengthened; secondly, the approach taken must as far as possible be a comprehensive one. For a detailed presentation of the applicable law in the Member States in 1992, see S. von Lewinski, ‘Public lending right: General and comparative survey of the existing systems in law and practice’, (1992) RIDA, 154, 3. For an analysis of the transpositions of the public lending right in a dozen Member States, see J.-P. Triaille et al., Study on the application of directive 2001/29/EC on copyright and related rights in the information Case 158/86 Warner Brothers Inc. and Metronome Video ApS v Erik Viuff Christiansen [1988] ECR 2605.

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Chapter 6 THE RENTAL AND LENDING RIGHTS DIRECTIVE

The manager of a video shop in Copenhagen purchased a copy of a video in London and imported it into Denmark with a view to hiring it out. The owner of the rights in the video production for Denmark sued the manager of the video shop on grounds that the latter had not acquired the licence for rental of video copies of the film, a right recognised by the Danish copyright law. The defence of the Danish video shop manager was the following: a maker of a film who has offered the video-cassette of that film for sale in a Member State whose legislation confers on him no exclusive right of hiring it out [] must accept the consequences of his choice and the exhaustion of his right to restrain the hiring-out of that video-cassette in any other Member State (Case 158/86, [18]).

The ECJ followed the line of the plaintiff and rejected the exhaustion of the right to prohibit the rental of copies that could be considered as covered by the exhaustion of the distribution right following the marketing of video cassettes. 6.04 However, the problems raised by the lack of harmonisation were made clear. One wishes that such distortion of the free movement of goods in the internal market would always lead the European legislature to intervene in such an effective manner for the protection of creators and with a flexible approach, while still taking into account the interests of other stake holders (such as performers, producers and the public). 6.05 The association in this Directive of both rental and lending on one hand, and related rights on the other, is due to the necessity to provide performers and producers with rental rights, be it the remuneration for the former or the necessary right to control the successive exploitations of the works, fixations and reproduction demanding high investments. It would have been inconsistent to provide these categories of right holders with these specific rights when several countries did not provide them with any copyright or entitlement due to copyright. Consequently the second chapter provides performers, producers and broadcasting organisations with the basic rights of the copyright system. Further, this comprehensive approach fits with the approach of the European legislature, which is solely founded on economic concerns (and not on humanistic or cultural objectives, as are continental national traditions of authors’ rights).4 The absence of moral rights in this fundamental copyright-law Directive speaks for this line as well. 6.06 The European Commission published a proposal in February 1991.5 Lively debates followed.6 The Directive was eventually released as Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property. Beside numerous exceptions (Art. 13 Dir. 92/100 on rental right and lending right), the implementation into national laws was due by 1 July 1994. A Report of the European Commission was released in 2002 on one of the most debated issues: the public lending right.7 It observed remaining lack of implementation.8 The concern is still current as regards the rental right.9

4 5 6 7 8 9

V-L. Bénabou, Droits d’auteur, droits voisins et droit communautaire, Bruylant, Brussels, 1997, para. 527. Proposal for a Council Directive on rental right, lending right, and on certain rights related to copyright. COM (90) 586 final, 24 January 1991, (COM (90) 586 final). J. Reinbothe and S. von Lewinski, The E.C. Directive on Rental and Lending Rights and on Piracy, 1st ed., Sweet & Maxwell, London, 1993, at 16–28. Report from the Commission to the Council, the European Parliament and the Economic and Social Committee on the public lending right in the European Union COM/2002/0502 final, 12 September 2002. Ibid, 11. E. Vanheusden, ‘AEPO-ARTIS Study, Performers’ Rights in European Legislation: Situation and Elements for Improvement’, 2009, http://www.aepo-artis.org/usr/AEPO-ARTIS%20study%202009/AEPO-ARTIS%20Study%20 Update_200912.pdf (accessed 11 April 2013), 7 and 60–67.

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I. GENERAL REMARKS

Following several amendments occurring in other Directives (Dir. 93/98 on the term of protection 6.07 and Dir. 2001/29 on the information society), the whole Directive has been codified. Directive 92/100 has thus been repealed and replaced with its homonymous Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property. All references to ‘the Directive’ in this chapter are made in respect of the codified version. Regarding the objective of the harmonisation, the need for a common market free of internal 6.08 frontiers and of competition distortion (Dir. 92/100, Recital 1) has not been repeated in the codified version of 2006 although this ground is still valid. Differently, the first reason that is presented in the version of 2006 is the ‘increasingly important role’ of rental of copyright works, in particular for authors, performers and producers of phonograms and films (Dir. 2006/115, Recital 2). This may indeed be questioned in a time when the role of tangible media or carriers is decreasing in favour of digital ones, be they downloaded or streamed without durable downloads. Regarding the current development of the media market and the ways works are disseminated at present, the importance of this Directive will probably decrease as long as its object is restricted to the trade in tangible products. We hope that it will be extended to digital products.10 The interplay of exclusive rights and rights to remuneration (as in Arts 5 and 6 of the Directive) could be a way to solve the struggles currently faced in defining the uses actually covered by the right of communication to the public and of making available, specifically, whether they are distinct or not from the mechanical right.11 This would also require rethinking the scheme designed by Directive 2001/29 on the information society. The DSM Directive (Dir. 2019/790) unfortunately did not address this issue. The acquis of Directive 2006/115 on the rental right and lending right should remain for the sake of consistency in European copyright law, even if the economic significance of the temporary making available of tangible copies of protected works might decrease. It is anyway expected that this Directive will remain important since it gives an example of a fair compromise between the need for protection of cultural creativity (safeguarding continuous and adequate remuneration of all right holders, especially of the creative ones as opposed to the investors) and the democratisation of access to cultural goods. Thus, Directive 2006/115, Recital 5, appears in the EU case law as a basis, together with Directive 2001/29, Recital 10, for IP ‘does not guarantee the right holders concerned the opportunity to demand the highest possible remuneration’ but ‘only appropriate remuneration for each use of the protected subject-matter’ (Case 403/08, 429/08, 108).

NOTES 1. Related instruments Report from the Commission to the Council, the European Parliament and the Economic and Social Committee on the public lending right in the European Union COM/2002/0502 final, 12 September 2002. Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.6.2001. Council Directive 93/98/EEC of the European Parliament and of the Council of 29 October 1993 harmonising the term of protection of copyright and certain related rights, OJ L 290/9, 24.11.1993. Council Directive 91/250/EEC of the European Parliament and of the Council of 14 May 1991 on the legal protection of computer programs, OJ L 122/42, 17.5.1991. Proposal for a Council Directive on rental right, lending right, and on certain rights related to copyright, COM (90) 586 final, 24.1.1991.

10 11

On the discussions on this question during the preparation of the Directive, see Reinbothe and von Lewinski, 41–2. On the discussion more recently, see Dusollier [2014] and at 6.20. See Munich Court of Appeal (Oberlandesgericht München), 29 April 2010, Case 29 U 3698/09, (2014) International Review of Intellectual Property and Competition Law, 97 (confirming the judgment of the Munich District Court).

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Chapter 6 THE RENTAL AND LENDING RIGHTS DIRECTIVE Follow-up to the Green Paper – Working programme of the Commission in the field of copyright and neighbouring rights, COM(90) 584 final, 17.1. Green Paper on Copyright and the Challenge of Technology – Copyright Issues Requiring Immediate Action, COM(88) 172 final.

2. CJEU case law Football Association Premier League e.a. v QC Leisure e.a. (Case C-403/08) and Karen Murphy v Media Protection Services Ltd (Case C-429/08) [2011] ECLI:EU:C:2011:631. Warner Brothers Inc. and Metronome Video ApS v Erik Viuff Christiansen (Case 158/86) [1988] ECR I-02605.

3. Bibliography Bénabou, V.-L. Droits d’auteur, droits voisins et droit communautaire, 1st ed., Bruylant, Bruxelles, 1997. Dusollier, S. ‘A Manifesto for an E-lending Limitation in Copyright’, (2014) JIPITEC 5, 213. Reinbothe, J. and S. von Lewinski, The E.C. Directive on Rental and Lending Rights and on Piracy, 1st ed., Sweet & Maxwell, London, 1993. Stamatoudi, I. ‘Disharmonising issues in the harmonized EU rental and lending rights system’ in Genowefy Grabowskiej (ed.), Poland and Great Britain in the Context of the European Union. Selected Legal Questions, Wydawnictwo Universytetu Śląskiego, Katowice, 2002, 210. Vanheusden, E. ‘AEPO-ARTIS Study, performers’ rights in European Legislation: Situation and elements for improvement’, 2009, http://www.aepo-artis.org/usr/AEPO-ARTIS%20study%202009/AEPO-ARTIS%20Study %20Update_200912.pdf (accessed 11 April 2013). von Lewinski S. ‘Public lending right: General and comparative survey of the existing systems in law and practice’, (1992) RIDA, 154, 3–81. von Lewinski, S. ‘Rental and Lending Rights Directive’, in Walter, M. and S. von Lewinski (eds), European Copyright Law, Oxford University Press, Oxford, 2010.

CHAPTER I RENTAL AND LENDING RIGHT ARTICLE 1: OBJECT OF HARMONISATION 1. 2.

In accordance with the provisions of this Chapter, Member States shall provide, subject to Article 6, a right to authorise or prohibit the rental and lending of originals and copies of copyright works, and other subject matter as set out in Article 3(1). The rights referred to in paragraph 1 shall not be exhausted by any sale or other act of distribution of originals and copies of copyright works and other subject matter as set out in Article 3(1).

II. COMMENTARY 6.09 The reasons for the wish to approximate the national laws were the achievement and proper functioning of the internal market due to the existing differences in the legal protection provided by the laws and practices of the Member States for copyright works and subject matter of related rights protection as regards rental and lending (Dir. 92/100, Recital 1). To this end, the differences had to be eliminated in order to ensure that competition in the common market would not be distorted (Dir. 92/100, Recital 3). That said, the Directive went far beyond the lowest common denominator and in fact initiated the – since then steady – movement towards a strengthening of the position of right holders. The first article of the Directive sets the tone.

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ARTICLE 1: OBJECT OF HARMONISATION

1. The exclusive rights The structure of the first articles is one of the changes to the original version effected by the 6.10 codification of 2006. In this new redaction, the definition of both concepts of rental and lending is pushed back to the second article. The first article now stresses the choice to anchor the principle of an exclusive right for both prerogatives, immediately tempered by the reference to the derogation regarding the lending right. The location of the principle of the exclusive right in the first paragraph of the first article of the 6.11 Directive definitely gives a ‘symbolic’12 weight to this principle, following a ‘pedagogic’13 line, even though numerous derogations, especially regarding the lending right, reduce the apparent supreme control given to right holders. The prohibition option is provided for so that right holders can control the timely distribution of 6.12 works, recordings and films depending on national markets (due to advertising costs for example), and develop parallel markets for sales and rentals. These are highlighted by the Warner Brothers decision (Case 158/86, [14]): Consideration must be given to the emergence […] of a specific market for the hiring-out of such recordings, as distinct from their sale. The existence of that market was made possible by various factors such as the improvement of manufacturing methods for video cassettes which increased their strength and life in use, the growing awareness amongst viewers that they watch only occasionally the video cassettes which they have bought and, lastly, their relatively high purchase price. The market for the hiring-out of videocassettes reaches a wider public than the market for their sale and, at present, offers great potential as a source of revenue for makers of films.

In this context, the objects at the centre of consideration are video and sound recordings, for which the investments are the biggest (Recital 5). However, both rental and lending rights apply to all works. Only the rental right has to be implemented as an exclusive right whereas the lending right can be 6.13 reduced to the entitlement to remuneration (Art. 6). Most Member States previously did not provide for explicit rental rights or explicit lending rights as 6.14 exclusive rights.14 For example, the rental right was explicitly recognised as an exclusive right in Denmark, Italy, Portugal, Spain and the UK, but not necessarily for all works. It was possibly covered by a distribution right in Belgium, and by a broad interpretation of the extent of uses covered by the reproduction right in countries where the theory of the right of destination had been successful. French law is a typical example, but one may say that this theory has been received in Greece, 6.15 Luxembourg and Belgium. As of Spring 2020, the rental right still is expressly implemented in French copyright law only for computer programs15 and subject matters covered by related rights,16 and the remuneration right for lending was only recognised in 200317 for copies that have been subject to a publishing agreement and released as books.18 This implicit (and as such mostly not

12 13 14 15 16 17 18

Bénabou, para. 494. H. Comte ‘Une étape de l’Europe du droit d’auteur: la directive CEE du 19 novembre 1992 relative au prêt et à la location’, (1993) RIDA 158, at 5. For a detailed presentation of the applicable law in the Member States in 1992, see Reinbothe and Lewinski, 137–80. Art. L. 122–6 3° Code de la propriété intellectuelle. Art. L. 213–1, 215–1 and 216–1 3° Code de la propriété intellectuelle, only in favour of producers. Loi n° 2003–517 of 18 June 2003. Art. L. 133–1 3° Code de la propriété intellectuelle.

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Chapter 6 THE RENTAL AND LENDING RIGHTS DIRECTIVE

enforced) acknowledgement of the right to authorise or prohibit the use made of copies of a protected work is founded on the following. 6.16 The theory of ‘droit de destination ’,19 ‘Bestemmingsrecht ’20 or ‘right of destination’21 relies on a synthetic approach to prerogatives granted by copyright law. The express anchorage of exclusive rights of authors mentions only the exclusive rights to reproduce and to perform.22 This synthetic approach is to be understood as opposed to the analytic approach taken by the EU law, and traditionally by ‘copyright law’ countries, where all prerogatives of authors are expressly enumerated. To put it in a nutshell and to explain here only the relevant part of the theory of the right of destination: the reproduction right being the right that the author assigns to the publisher when a book is to be published, it necessarily comprises the distribution right. This right to control the use made of copies of the work also relies on considerations related to the moral rights.23 According to this theory, the right to authorise or prohibit the rental and the lending of copies is implicitly recognised in the exclusive right of reproduction that comprises the control of the destination of copies reproducing the work;24 there would therefore be no need to amend the French copyright law.25 6.17 This is definitely a seductive theory,26 and the reader can only approve of the economy of legal provisions. Unfortunately, the need for clarity mostly speaks for express recognition, especially when the payment of fees depends on the effective enforcement of new rights. This is confirmed by the express implementation to a right of remuneration for the lending of books in France in 2003.

2. Originals and copies 6.18 The rental and lending right covers all works and subject matters as listed in Article 3. One can wonder about the reason for the mention of originals whose value mostly does not lie in the copyright but in their authenticity and rarity. The only meaningful appearance of originals in copyright law is in respect of the droit de suite that only concerns graphic and plastic arts; this specific treatment is justified by the specific value of originals in this field as opposed to the business related to the copies in the other branches (Dir. 2001/84 on the resale right, Recital 3). 6.19 One might think that the mention of originals aims at covering the rental and lending amongst museums or handled by art galleries. Recital 10 does not solve the question as to why this reference to originals is made, but it excludes these uses from the scope of this Directive, as well as making available phonograms or films for the purpose of public performance or broadcasting. 6.20 As a result, this scope is to be read as a consequently comprehensive approach. On a question raised by the District Court of The Hague (Netherlands), the third Chamber of the CJEU surprised with

19 20 21 22 23 24 25 26

F. Pollaud-Dulian, Le droit de destination, LGDJ, 1989. F. Gotzen, Het Bestimmingsrecht van de Auteur, Larcier, 1975. F. Gotzen, ‘The Right of Destination in Europe’, (1989) Copyright, 218–32. See, for the French example Art. L. 122–1 Code de la propriété intellectuelle. A. Françon, ‘L’auteur d’une oeuvre de l’esprit épuise-t-il son droit de divulgation par le premier useage qu’il en fait ?’ (1973) GRUR Int. 264–6. T. Desurmont, ‘The author’s right to control the destination of copies reproducing his work’, (1987) RIDA, 134, 3–69. Réponse ministérielle 9 août 1999, Journal officiel de l’Assemblée nationale, Q 27 September 1999, 5601. French case law applied this theory to the successive public performing of recordings in discotheques (Cour de cassation, Civ. 1, 22 March 1988 (2 decisions: Bull. Civ. 88, p. 56; 89, p. 57), but no case law, to our knowledge, ever recognised the rental or lending right on the sole basis of this theory or on the basis of the reproduction or fixation right. The question has been raised before the European Court of Justice, but the Court answered on another grounding, see Bénabou, 201–6, and Case 395/87 Ministère Public v Tournier [1989] ECR 2521, [12–13].

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an answer in favour of the Dutch public library association (VOB) and a scope covering e-books. The Court stated that: the concept of ‘lending’, within the meaning of [Dir. 2006/115 Art. 1(1), 2(1)b, and 6(1)] covers the lending of a digital copy of a book, where that lending is carried out by placing that copy on the server of a public library and allowing a user to reproduce that copy by downloading it onto his own computer, bearing in mind that only one copy may be downloaded during the lending period and that, after that period has expired, the downloaded copy can no longer be used by that user. (C 174/15, 54)

3. The relation to the exhaustion of the distribution right The delicate coexistence of the exhaustion of the distribution right, relying on the free movement of 6.21 goods in the internal market (Arts 28–29, EC Treaty), and the rental right had been stated in the Warner Brothers case. The control of lending and rental indeed constitutes a restriction to the free movement principle and hence has to pass the test of Article 36 EC Treaty. In the Warner Brothers case, the Court founded this restriction on the fact the rental right is part of the specific object of the copyright law [14–16]. This however had to be anchored by this Directive. Even after the entry into force of the Directive, the ECJ had again to state that the rental right was 6.22 not in contradiction with the exhaustion of the distribution right. It is not contrary to Article 30 or Article 36 of the Treaty or to the Rental and Lending Directive for the holder of an exclusive rental right to prohibit copies of a film from being offered for rent in a Member State even where the offering of those copies for rent has been authorised in the territory of another Member State (Case C-61/97, [23]). Further, the rental right does not infringe the EC Treaty since, ‘the release into circulation of a sound recording cannot, by definition, render lawful other forms of exploitation of the protected work, such as rental, which are of a different nature from sale or any other lawful form of distribution (Case C-200/96, [18]). Directive 2001/29 on the information society reaffirmed both the principle of the exhaustion of the distribution right and the fact that rental and lending rights are not affected by the first sale (Dir. 2001/29, Recital 28 and Art. 4).

NOTES 1. Related instruments Consolidated Version of the Treaty on European Union OJ C 115, 9.5.2008, 13. Council Directive 2001/84/EC of the European Parliament and of the Council of 27 September 2001 on the resale right for the benefit of the author of an original work of art OJ L 272/32, 13.10.2001. Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001.

2. CJEU case law Foreningen af danske Videogramdistributører, acting for Egmont Film A/S, Metronome in the person of Hans Kristian Pedersen and Others v Laserdisken (C-61/97) [1998] ECR I-5187. Metronome Musik v Music Point Hokamp (C-200/96) [1998] ECR I-1953. Vereniging Openbare Bibliotheken v Stichting Leenrecht, (C-174/15) [2016] ECR 459. Warner Brothers Inc. and Metronome Video ApS v Erik Viuff Christiansen (Case 158/86) [1988] ECR 2605.

3.

Bibliography

Bénabou, V.-L. Droits d’auteur, droits voisins et droit communautaire, 1st ed., Bruylant, Bruxelles, 1997. Comte, H. ‘Une étape de l’Europe du droit d’auteur: la directive CEE du 19 novembre 1992 relative au prêt et à la location’, (1993) RIDA, 158, 3–73.

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Chapter 6 THE RENTAL AND LENDING RIGHTS DIRECTIVE Desurmont, T. ‘Le droit de l’auteur de contrôler la destination des exemplaires sur lesquels son œuvre se trouve reproduite/The author’s right to control the destination of copies reproducing his work’, (1987) RIDA, 134, 3–69. Françon, A. ‘L’auteur d’une œuvre de l’esprit épuise-t-il son droit de divulgation par le premier usage qu’il en fait?’, (1973) GRUR int. 264–66. Gotzen, F. ‘The right of destination in Europe’, (1989) Copyright, 218–32. Gotzen, F. Het Bestemmingsrecht van de Auteur, Larcier, Brussels, 1975. Lebois, A. ‘Droits patrimoniaux – Droit de location et de prêt’, (2012) Juris-Classeur Civil Annexes, Vo Propriété littéraire et artistique, fascicule 1254. Pollaud-Dulian, F. Le droit de destination, Le sort des exemplaires en droit d’auteur, LGDJ, Paris, 1989.

ARTICLE 2: DEFINITIONS 1.

2.

For the purposes of this Directive the following definitions shall apply: (a) “rental” means making available for use, for a limited period of time and for direct or indirect economic or commercial advantage; (b) “lending” means making available for use, for a limited period of time and not for direct or indirect economic or commercial advantage, when it is made through establishments which are accessible to the public; (c) “film” means a cinematographic or audiovisual work or moving images, whether or not accompanied by sound. The principal director of a cinematographic or audiovisual work shall be considered as its author or one of its authors. Member States may provide for others to be considered as its co-authors.

II. COMMENTARY 6.23 The codification of 2006 led to the systematic listing of definitions of the key concepts in this second article, respectively, of the main input of the Directive as regards the acquis communautaire in copyright law: the broad definitions of rental and lending, and the mandatory recognition of the director of a film as one of its authors.

1. Definitions 6.24 Definitions were stated in different articles in the 1992 version, but no substantial change was made. In the following: section A presents the common feature of rental and lending; section B the difference between them; section C the establishments accessible to the public; section D film; and section E the still-undefined concepts.

A. Rental and lending: Making available for a limited period of time 6.25 The common feature is the fact that a copy of the work is owned by a final user for a limited time whereas the property of the goods containing the copy of the work belongs to a third person. Consequently, the criterion distinguishing rental and lending from sale or present is that the copy has to be returned after a certain time.27 This has to be understood broadly as the definition also covers acts that have a different legal structure from rental or lending but that are intended to have

27

J. Reinbothe and S. von Lewinski, The E.C. Directive on Rental and Lending Rights and on Piracy, 1st ed., Sweet & Maxwell, London, 1993, 36.

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the same result,28 for example sale with an option to repurchase the good at a price that is lower than the selling price.29 According to the travaux préparatoires, the word ‘use’ in both definitions is to be distinguished from 6.26 ‘exploitation’ and therefore understood as ‘private use’.30 This is also supported by Recital 10, which excludes from the definition of lending and rental the use for public performance. Recital 10 also excludes ‘on-the-spot’ use in a library. This recital is to be considered together with 6.27 Article 5(3)(n) of Directive 2001/29 on the information society, which allows Member States to provide a limitation or an exception in favour of the ‘use by communication or making available, for the purpose of research or private study, to individual members of the public by dedicated terminals on the premises of’ publicly accessible libraries, educational establishments or museums, or by archives ‘of works and other subject-matters not subject to purchase or licensing terms which are contained in their collections’. The comparison allows the conclusion that the extent of uses allowed without authorisation or remuneration is broader for tangible than for digital copies. The Warner Brothers case already emphasised the emergence of the market for rental that followed 6.28 the increasing quality of copies and their similarly increasing price for sale (paras 14–15). This made right holders aware of their interest in the control of the making available for a limited time whereas this traditionally did not constitute a business but a social and educative function mostly carried out by public libraries. Lending only became a lucrative business after the price of VCRs (video cassette recorders) reached an amount accessible to most final consumers. The development of the business of rental outlets raised concerns as it was considered a diversion of the legitimate business from licensed distributors (Follow up paper, 4.5.6). The need for a regulation of the rental right on the European level had been clearly established for 6.29 sound and video recordings since the Green Paper in 1988. However, before the Directive proposal, ‘non-commercial rental’, or lending, did not require intervention because of the ‘small amounts involved’, but also because of more formal reasons such as the fact that the public lending schemes relied on different national traditions, and, especially, that they were ruled outside the copyright system and carried out by institutions working for the general interest (Green Paper, 4.4.4–4.4.10). The Commission, however, decided to bring lending into line with rental, providing both with an 6.30 exclusive right. This option was taken because lending and rental are in competition: therefore, if rental necessarily required the authorisation of right holders, whereas lending could have been free of charge, the market for rental would have disappeared, and the European intervention would have achieved the opposite of its goal, which was to secure the recouping of investment of creative industries.

B.

Rental versus lending: The criterion of direct or indirect economic or commercial advantage Recital 11 explains how the criterion of ‘direct or indirect economic or commercial advantage’ (Art. 6.31 2(1)b, Dir. 2006/115) is to be understood as it defines what would allow a Member State to exempt libraries from the burden of getting authorisation from right holders:

28 29 30

A. Lebois, ‘Droits patrimoniaux – Droit de location et de prêt’, Juris-Classeur Civil Annexes, V Propriété littéraire et artistique, fascicule 1254, para. 8. Reinbothe and Lewinski, 36. Ibid.

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Chapter 6 THE RENTAL AND LENDING RIGHTS DIRECTIVE Where lending by an establishment accessible to the public gives rise to a payment the amount of which does not go beyond what is necessary to cover the operating costs of the establishment, there is no direct or indirect economic or commercial advantage within the meaning of this Directive.31

6.32 Lending is therefore not defined by its cost (it must not be gratuitous) but rather by its purpose: ‘not for direct or indirect economic or commercial advantage’. Consequently, its lack of a charge for the end user does not exclude the mandatory payment of a fee by the lending institution: if a library lends copies of copyright-protected works for free, but serves private interests, like advertising for the entity bearing the costs of books, location, etc, the promotion effect would be deemed as an indirect economic or commercial advantage. Such making available would therefore be considered as a rental and not a lending. Along the same line, the making available of newspapers in the waiting area of a hairdresser’s or of DVDs for the guests of a hotel should be considered rentals. In this regard however, it should be noted that on-the-spot uses of tangible goods can be considered as belonging to the competence of Member States, European law being then only subsidiary. For example, the payment of a fee by the end user in an establishment ‘accessible to the public’ (Art. 2(1)(b)) or covered by the derogation of Article 6(3) does not rule out that the making available is considered to be lending as long as the payment does not exceed the establishment’s operating costs, which is the case for example in most public libraries in Germany.

C. Establishments accessible to the public 6.33 This definition is to be interpreted broadly, especially if taken together with the derogation of Article 6. Considering the very close wording used in Directive 2001/29 on the information society (publicly accessible libraries), one may conclude that no conflict arose on this issue.32 6.34 The word ‘library’ is not to be etymologically interpreted as a collection of books. Collections of music recordings or film recordings are also covered by the Directive.

D. Film 6.35 The definition of film set out by Article 2(2) was necessary as international law provides neither for such a definition nor for a definition of audiovisual works. The Beijing WIPO Treaty does not help either, as it refers strictly to ‘audiovisual fixation’ (defined in Art. 2b, Beijing Treaty) and carefully avoids any reference to works and to film. 6.36 However the definition of a film in this Directive essentially aims at avoiding the exclusion from protection of any audiovisual objects, which could have been the case if reference had been made to cinematographs (which could exclude television productions) or to works (which excludes nonoriginal subject matter like reports). 6.37 The clear definition of these concepts in Article 2 (see also the definition of protected performances in Art. 8 below) makes it noticeable that several important notions are not defined in the Directive.

E. The undefined concepts 6.38 Authors, performers and producers are not defined. This should be interpreted as a way to recognise the definitions stated in the applicable international law when it defines performers (Art. 3, Rome Convention) and to give Member States the freedom, where necessary, to stay in line with their national traditions, as is the case with film producers and authors.

31 32

On the history of the wording of the criterion, see Reinbothe and Lewinski, 38–41. About the history of this expression in the Dir. 92/100, see Reinbothe and Lewinski, 42–3.

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ARTICLE 2: DEFINITIONS

Other articles of the Directive give clues on these concepts. Regarding the film producer, this has to 6.39 be the person concentrating the licences in the film for its commercial exploitation (Art. 3(4)–(6)), and the reference to the first fixation (Art. 3(1)(c)) implies that the producer of the copies of the first fixation is not concerned (see also Case C-61/05 [41]: ‘the producer of videograms does not […] enjoy the status of a film producer’). The ECJ confirmed this interpretation when it stated that Portuguese law failed to comply with the harmonisation required by the Directive on rental right and lending right by creating a rental right ‘also in favour of producers of videograms’ (Case C-61/05, [29]). This is due to the fact that only the film producer (and the phonogram producer) have to be provided with a rental right to help in recouping the ‘high and risky’ investments that merit special protection (Case C-61/05, [28]), whereas the distribution of exclusive rights to more persons than provided for in the Directive goes against the aim of harmonisation. Regarding the author, the option taken with regard to films, to in any case consider the principal 6.40 director as an author (Art. 2(2)), requires the conclusion that, conversely, persons ‘who are not genuine creators cannot be regarded as authors under the Directive’.33 However the wording of Article 2.2 is flexible enough to respect differences of national traditions and to allow Member States to further consider as a film’s authors any creative persons like the composer of the score, the writer of the script or the producer.

2. Authorship of the principal director Considering the principal director of a film as its author, or one of its authors, was already enshrined 6.41 in the continental conception of droit d’auteur. But this is far from obvious in the Anglo-Saxon countries, where the copyright of a film originally vests in the producer rather than in the creatively involved persons (and where the original vesting of copyright in the investor rather than in the creator is in line with the ‘work made for hire’ conception). The shift induced by this provision required the inclusion of the flexibilities in Article 11(4) and (5) as regards films created and contracts concluded before the entry into force of the Directive (1 July 1994), and in Article 11(7) on acts of exploitation after 1 July 1997. 6.42

The term ‘principal director’ refers to the Berne Convention (Art. 14(3)). As this provision regarding authors of films was originally (in the 1992 Directive) limited to ‘the purposes of this directive’ (Art. 2(2), Dir. 92/100), and only gained general validity for European copyright law in 1993 in the Duration Directive (Art. 2(2), Dir. 93/98 on copyright duration), we refer to the comment of Article 2(1) of Directive 2006/116 on copyright duration.

NOTES 1. Related instruments WIPO Beijing Treaty on Audiovisual Performances adopted by the Diplomatic Conference on 24 June 2012. Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights (codified version) OJ L 372/12, 27.12.2006. Council Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights OJ L 290/9, 24.11.1993. Follow-up to the Green Paper – Working programme of the Commission in the field of copyright and neighbouring rights, COM(90) 584 final, 17.1.1991. Green Paper on Copyright and the Challenge of Technology – Copyright Issues Requiring Immediate Action, COM (88) 172 final, 7.6.1988.

33

Reinbothe and Lewinski, 46.

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Chapter 6 THE RENTAL AND LENDING RIGHTS DIRECTIVE Berne Convention for the Protection of Literary and Artistic Works last amended on 28 September 1979. Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations of 26 October 1961.

2. CJEU case law Commission of the European Communities v Portuguese Republic (Case C-61/05) [2006] OJ C224/06. Warner Brothers Inc and Metronome Video ApS v Erik Viuff Christiansen (Case 158/86) [1988] ECR 2605.

3. Bibliography Lebois, A. ‘Droits patrimoniaux. – Droit de location et de prêt’ (2012) Juris-Classeur Civil Annexes, V Propriété littéraire et artistique, fascicule 1254. Reinbothe, J. and S. von Lewinski, The E.C. Directive on Rental and Lending Rights and on Piracy, 1st ed., Sweet & Maxwell, London, 1993.

ARTICLE 3: RIGHTHOLDERS AND SUBJECT MATTER OF RENTAL AND LENDING RIGHT 1.

2. 3. 4.

5. 6.

The exclusive right to authorise or prohibit rental and lending shall belong to the following: (a) the author in respect of the original and copies of his work; (b) the performer in respect of fixations of his performance; (c) the phonogram producer in respect of his phonograms; (d) the producer of the first fixation of a film in respect of the original and copies of his film. This Directive shall not cover rental and lending rights in relation to buildings and to works of applied art. The rights referred to in paragraph 1 may be transferred, assigned or subject to the granting of contractual licences. Without prejudice to paragraph 6, when a contract concerning film production is concluded, individually or collectively, by performers with a film producer, the performer covered by this contract shall be presumed, subject to contractual clauses to the contrary, to have transferred his rental right, subject to Article 5. Member States may provide for a similar presumption as set out in paragraph 4 with respect to authors. Member States may provide that the signing of a contract concluded between a performer and a film producer concerning the production of a film has the effect of authorising rental, provided that such contract provides for an equitable remuneration within the meaning of Article 5. Member States may also provide that this paragraph shall apply mutatis mutandis to the rights included in Chapter II.

II. COMMENTARY 6.43 This article first presents the scope (paras 1A and B), then the transferability (para 2) and finally the presumption in favour of film producers (para 3).

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ARTICLE 3: RIGHTHOLDERS AND SUBJECT MATTER OF RENTAL AND LENDING RIGHT

1. Beneficiaries and subject matter of the rental and lending right A.

Beneficiaries

The first intention regarding a legislative intervention in the copyright field was to provide only 6.44 some right holders with a new right. The need for an intervention on the European level was: mainly based on the consideration that the increasing penetration of compact discs, which do not deteriorate upon repeated use, entails the risk that the author, the performer and the phonogram producer may suffer economic damage by the unauthorized commercial rental of sound recordings. This risk should be countered by the introduction in all Member States of a right for the author, the performer and the phonogram producer to authorize the commercial rental of sound recordings (Green Paper, 4.11.1).

However, for audiovisual works, the need for action was acknowledged only for producers (Green Paper, 4.11.2): ‘As far as video recordings are concerned, the economic interest of the producer of the cinematographic work so recorded makes it necessary to guarantee him the right to choose the time and place to exploit his work by performance in movie theatres and by commercial rental,’ whereas no need was established as regards authors and other actors of the creative chain (Green Paper, 4.11.3). This led to the conclusion that a rental right for sound and video recording was to be introduced on 6.45 the European level for authors, performers and phonogram producers of sound recordings (Follow up paper, 4.11.1) and only for producers of video recordings (Follow up paper, 4.11.2). No further need was established at this stage. In the end, the Directive indiscriminately provides all right holders in works or subject matters that 6.46 are involved until the film as such exists with both rental and lending right as a matter of consistency. Upon being asked whether exclusive rental rights are also granted to the videogram producer, the Court of Justice answered (Case C-61/05, Commission of the European Communities v Portuguese Republic): Granting an exclusive right also to videogram producers would not simply add an extra category of rightholders to the list in Article 2(1) of the Directive, but would, on the contrary, call into question the specific exclusive rights set out in that provision. [22]. In that respect, Article 2(1) of the Directive confers on the producer of the first fixation an exclusive right to authorise or prohibit rental and lending in respect of the original and copies of his film. It follows that, if the producer of a videogram were also granted the right to control the rental of that videogram, the right of the producer of the first fixation would manifestly no longer be exclusive. [23] That interpretation is confirmed by the object of the Directive, which is to establish harmonised legal protection in the Community for the rental and lending right and certain rights related to copyright in the field of intellectual property (see Case C-200/96 Metronome Musik [1998] ECR I-1953, para 22). [24]. As is specifically apparent from the first recital in the preamble thereto, the Directive aims to eliminate the differences between the Member States in respect of the legal protection for copyright works as regards rental and lending, with the aim of reducing barriers to trade and distortions of competition. If Article 2(1) of that Directive allowed Member States freely to confer the right to authorise or prohibit the rental of videograms to different categories of persons, that aim would manifestly not be achieved. [25]

Because of the non-discrimination according to nationality inside the Union (Art. 12, EC Treaty), 6.47 Member States may not provide for rights in favour of only national right holders. This has been, and still is, a concern, especially in countries where remuneration for public lending is deemed as a support of national writers or is dedicated to social funds benefiting only nationals. This was the reason why, prior to the Directive, several Member States provided for a fiscal system for the remuneration of public lending (fiscal revenues may profit only nationals). And this seems to be a

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Chapter 6 THE RENTAL AND LENDING RIGHTS DIRECTIVE

weak point of the French allocation of half the remuneration from the public lending right of books in favour of a pension fund.34

B. Subject matter i.

Scope

6.48 Only tangible objects are subject to rental and lending. This raised a question as regards the qualification of video-on-demand systems, especially in cases in which the user is, for example, given the possibility of seeing a film (or using a bundle of works) for a certain amount of hours (or months), and in cases of the making available of a digital file for a limited period of time. The question also appears as regards the development of e-books.35 However the independent acknowledgement of the right of making available in Directive 2001/29 (see Art. 3(2) and Recital 24) and of the exception dedicated to the on-the-spot use of digitised documents in publicly accessible libraries, educational establishments or museums, and archives (Dir. 2001/29, Art. 5(3)(n)) definitely speaks for the strict application of the lending and rental rights only to tangible products.36 ii.

The derogation for buildings and works of applied art

6.49 With regard to the works to be covered by the rental right and the lending right, the Green Paper adopted a restrictive approach: it recommended limiting the protection to certain categories (audiovisual works and sound recordings made using digital techniques). The Directive adopted the principle of general protection covering all works, providing only for exceptions regarding copies of ‘useful’ works, such as works of architecture and works of applied art (the rental of building and objects of daily use relies on legal branches other than the copyright law), and computer programs (already covered by Dir. 91/250 on computer programs).

2. The transferability of the exclusive right 6.50 The possibility for right holders to transfer, assign or license their exclusive right may be viewed as a consequence of an environment consisting of multiple right holders. Indeed, the licit rental or the lending of the recording of a protected work will necessarily require the authorisation of the author(s) of the works involved, the performer(s) and the producer of the recording. If the transferability were limited, the transaction cost of contacting and getting the licence from all right holders involved could act as a deterrent. This light framework encourages the concentration of the rights to be obtained.

3. Presumptions in favour of the film producer 6.51 Article 3(4) makes it mandatory (C-61/05, [37]) for Member States to introduce the presumption that performers transfer their rental right to the producer of the first fixation of the film (C-61/05, [41]). The fact that the lending right is not covered by this presumption is to be read according to the objective of the legislature to consider the commercial exploitation of the film and the need for the producer to control it. 6.52 The next paragraph allows Member States to introduce a similar presumption regarding the lending right of authors. The last paragraph further allows deducing this presumed transfer from the

34 35 36

See Art. L. 133–4 2° Code de la propriété intellectuelle. On this issue, see T. Synodinou, ‘E-books, a new page in the history of copyright law?’ (2013) EIPR, 35(4), 220, 224–5. On the lending of digital copies organised by public libraries, see ‘Rapport Lescure’, 16–17 and 184–5 in favour of an adaptation of the Dir. 2001/29, and of a solution through collective management.

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ARTICLE 4: RENTAL OF COMPUTER PROGRAMS

contract between a performer and the producer of a film, under the condition that an equitable remuneration is provided for. This presumption system may cover all neighbouring rights. The premise is a compromise between the need to provide authors and performers with better 6.53 financial security and the need for producers to be able to take investment decisions regarding the exploitation of the film.37 The presumption has to be rebuttable (C-277/10 Martin Luksan v Petrus van der Let, [87]) and may 6.54 not be implemented by provisions vesting neither the exclusive right nor the right to an equitable remuneration in the person of the film producer.

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights signed on 15 April 1994. Berne Convention for the Protection of Literary and Artistic Works last amended on 28 September 1979. Consolidated Version of the Treaty on European Union OJ C 115/13, 9.5.2008. Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001. Council Directive 91/250/EEC of 14 May 1991 on the legal protection of computer programs OJ L 122/ 42 17.5.1991. Follow-up to the Green Paper – Working programme of the Commission in the field of copyright and neighbouring rights, COM(90) 584 final, 17.1.1991. Green Paper on Copyright and the Challenge of Technology – Copyright Issues Requiring Immediate Action, COM (88) 172 final, 7.6.1988. WIPO Performances and Phonograms Treaty adopted on 20 December 1996.

2. CJEU case law Martin Luksan v Petrus van der Let (C-277/10) [2012] OJ C80/12. Commission of the European Communities v Portuguese Republic (C-61/05) [2006] OJ C224/06.

3. Bibliography Lescure, P. ‘Mission “Acte II de l’exception culturelle” – Contribution aux politiques culturelles à l’ère numérique’, 2013, available at http://www.culturecommunication.gouv.fr/Actualites/A-la-une/Culture-acte-2–80-propositions-surles-contenus-culturels-numeriques (Rapport Lescure). Synodinou, T.-E. ‘E-books, a new page in the history of copyright law?’, (2013) EIPR, 35(4), 220–7. von Lewinski, S. International Copyright Law and Policy, 1st ed., Oxford University Press, Oxford, 2008.

ARTICLE 4: RENTAL OF COMPUTER PROGRAMS This Directive shall be without prejudice to Article 4(c) of Council Directive 91/250/EEC of 14 May 1991 on the legal protection of computer programs.

37

Cf. Green Paper at para. 4.11.2 and Recitals 5 and 15 of the Directive.

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Chapter 6 THE RENTAL AND LENDING RIGHTS DIRECTIVE

II. COMMENTARY 6.55 With regard to this article the reader is invited to consult the commentary of Directive 91/250 on the legal protection of computer programs, respectively of its codified version 2009/24 in Chapter 5 of this book, especially the comment on its Article 4(2). The remarks in the following two paragraphs are relevant. 6.56 The mandatory implementation of the specific provisions on the legal protection of computer programs due to Directive 91/250 led to the express recognition of a rental right only to the authors of computer programs, authors of other kind of works being (mostly less efficiently) granted a rental right only through a distribution right that was exhausted after the first sale, or through the reproduction right. The latter solution was satisfying only for commentators on copyright laws, but unfortunately not for right holders. 6.57 The interplay of this reference to the express acknowledgement of an exclusive right to control the rental of a computer program or its copies (Art. 4(c), Dir. 91/250 on computer programs) and the possible derogation of Article 6(2), Directive 2006/115 (the replacement of the exclusive right of lending by a right to remuneration) is not certain. No case law has issued a statement on this issue to our knowledge. Most probably Directive 91/250 on computer programs should be considered as lex specialis38 in respect of the comprehensive and general Directive 2006/115. Thus Article 4(c) of Directive 91/250 obliges Member States to implement an exclusive right of distribution, expressly including the right to control the rental, presumably including the right to control the lending of copies. Then again, Article 6(2) of Directive 2006/115 should be considered the lex specialis of the derogation to the exclusive right in respect of public lending, for which only the author is mandatorily granted a right to equitable remuneration. The concern may be purely theoretic since as regards computer programs the author is the only right holder (as there is neither protected performance nor protected fixation and no producer of software). The question is anyway most probably fended off by the fact that the trade in computer programs via tangible products is meanwhile decreasing to such an extent that a case before the CJEU as regards rental or lending is no longer to be expected.

NOTES 1. Related instruments Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs OJ L 111, 5.5.2009 (Codified version). Council Directive 91/250/EEC of 14 May 1991 on the legal protection of computer programs OJ L 122/42, 17.5.1991.

2. CJEU case law UsedSoft GmbH v Oracle International Corp (C-128/11) [2012] ECR I-00000; 3 July 2012, ECLI:EU:C:2012:407.

3. Bibliography Hilty, R., K. Köklü, F. Hafenbrädl ‘Software agreements: Stocktaking and outlook – Lessons from the UsedSoft v. Oracle case from a comparative law perspective’, (2013) IIC, 263. Macrez, F. ‘Copyright, computer programs and the Court of Justice’, (2012) RIDA, 234, 190–287.

38

Cf. para. 51, C-128/11 UsedSoft GmbH v Oracle International Corp.

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ARTICLE 5: UNWAIVABLE RIGHT TO EQUITABLE REMUNERATION

ARTICLE 5: UNWAIVABLE RIGHT TO EQUITABLE REMUNERATION 1. 2. 3. 4.

Where an author or performer has transferred or assigned his rental right concerning a phonogram or an original or copy of a film to a phonogram or film producer, that author or performer shall retain the right to obtain an equitable remuneration for the rental. The right to obtain an equitable remuneration for rental cannot be waived by authors or performers. The administration of this right to obtain an equitable remuneration may be entrusted to collecting societies representing authors or performers. Member States may regulate whether and to what extent administration by collecting societies of the right to obtain an equitable remuneration may be imposed, as well as the question from whom this remuneration may be claimed or collected.

II. COMMENTARY Like the presumption system stated in Article 4, the unwaivable right to remuneration only covers 6.58 the rental right, and not the lending right. The issue of the nature to be given to the rental right was still a concern in the follow-up to the Green Paper: should it consist of a right to authorise rental or be limited to the right to receive equitable remuneration?39 The compromise finally sketched by Article 5 is exemplary as it distributes the prerogatives attached to an exclusive right in a way that fairly defends the distinct interests of the investor and of the creator, without weakening the negotiation power of the right holders’ side vis-à-vis users.40

1. The unwaivability of the right to remuneration The rental right was not expressly stated in most of the national copyright statutes when the 6.59 Directive intervened in 1992. Some countries considered it as implicitly covered by the reproduction right.41 Some considered it as not relevant because of the exhaustion of the distribution right after the first sale. Germany was among the latter, but it had introduced a right to remuneration in 1972. Finally, those Member States that did provide for an exclusive right of rental in their statutes limited it to specific works or subject matters, such as software, phonograms and films. The German experience with the remuneration right was successful, but it did not effectively meet 6.60 the expectation of film and phonogram producers to be able to control the time and place to exploit their products according to a business strategy of their choice. The reference to the possibility for the producer to choose the ‘time and place to exploit his work by performance in movie theatres’42 became irrelevant in the course of the discussion about the Directive proposal (cf. Recital 10). But the reference to the ‘commercial rental’ is crucial. For the producer to be able to first promote the exclusive exploitation in movie theatres, excluding the competition with the domestic use of DVDs, the exclusive nature of the rental right was necessary. On the other hand, another experience spoke against a simple exclusive right without granting a 6.61 security for authors to benefit from the successive use of their works: the experience of book publishers. They succeed in maintaining their (alleged) symbiosis with authors. No related rights

39 40

41 42

Follow up paper, at para. 4.12.2. For a detailed presentation of this model by its ‘inventor’, see S. von Lewinski, ‘Collectivism and its role in the frame of individual contracts’, in J. Rosén, Individualism and Collectiveness in Intellectual Property Law, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2012, 120–22. See above at paras 6.17 and 6.17 for the right-of-destination theory. Follow up paper, at para. 4.1.3.

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Chapter 6 THE RENTAL AND LENDING RIGHTS DIRECTIVE

defend their specific interests to recoup their investment: they prefer to enjoy the advantages of the exclusive authors’ rights they are assigned in the publishing contracts. Unfortunately, after writers assign their rights in the course of the publication of the book, they have very little chance of being able to recover a part of the revenues flowing from the exploitation of their works. Meanwhile, Articles 15, 16, 18–22 of Directive 2019/790 address these issues, but as of Spring 2020 the situation in Member States did not significatively evolve. 6.62 Article 5 divides the exclusive right into two prerogatives distributed to two kinds of right holders having two different needs: the right to authorise stays in the hands of the producer, who needs the economic control of the exploitation of the film; and a right to remuneration stays in the hands of the creative people who contributed to the film. Indeed, the system of presumption provides that rights of original right holders in works or subject matters contributing to the film are transferred (see Art. 3(3)–(6)) to the producer for him to be able to take economically strategic decisions relating to the control of the film’s dissemination; but the right to an equitable remuneration vesting in creative participants is unwaivable. The latter solves the typical problem faced by authors and performers when they conclude a contract with a producer hiring them for a film or accepting the publication of a book. The creative people generally have no chance to obtain a fair remuneration clause in such contracts as they are usually only too happy to see their book published or their film produced or to find a job, and are, therefore, in a weak bargaining position. The unwaivability grants them a continuous remuneration. The rule is mandatory and thus fairly serves the aim stated in Recital 5. This unwaivable right to remuneration is the result of amendments made to the first proposal of the Commission, which had been criticised for being too much in favour of the industry.43 6.63 This provision is limited to the sectors of sound and video recordings. This can be related to the scope of the rental right as actually practised (there is no significant market for rental of writings). This discrimination can also be justified by the industrial investment required in the music and film sectors. But this is also another avatar of the genuine situation of the written branch, where publishers stay behind the authors, as they are more confident in their power to get authors’ rights assigned than in the pertinent granting of specific rights by the legislature.

2. The role to be played by collecting societies 6.64 In line with the defence of weak parties of copyright contracts, the third paragraph expressly commands that the unwaivable equitable remuneration may be collectively managed (cf. Recital 12), which requires an exception to the unwaivability for right holders to be able to entrust the right to a collective management organisation. The European legislature did not go as far here as in Directive 93/83 on satellite broadcasting and cable retransmission, where Member States had to introduce a mandatory collective management, but they already strongly supported the collective administration of the right to remuneration since Article 5(4) allows Member States to impose the requirement that rights to remuneration are exercised by collecting societies.

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, OJ L 248/15, 6.10.1993.

43

S. von Lewinski, ‘Collectivism and its role in the frame of individual contracts’, in Rosen, J. (ed), Individualism and Collectiveness in Intellectual Property Law, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2012, 6.0.2.

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ARTICLE 6: DEROGATION FROM THE EXCLUSIVE PUBLIC LENDING RIGHT Follow-up to the Green Paper – Working programme of the Commission in the field of copyright and neighbouring rights, COM(90) 584 final, 17.1.1991. Green Paper on Copyright and the Challenge of Technology – Copyright Issues Requiring Immediate Action, COM (88) 172 final, 7.6.1988.

2. CJEU case law Commission of the European Communities v Portuguese Republic (C-61/05) [2006] OJ C224/06.

3. Bibliography von Lewinski, S. ‘Collectivism and its role in the frame of individual contracts’, in Rosén, J. (ed), Individualism and Collectiveness in Intellectual Property Law, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2012.

ARTICLE 6: DEROGATION FROM THE EXCLUSIVE PUBLIC LENDING RIGHT 1.

2. 3.

Member States may derogate from the exclusive right provided for in Article 1 in respect of public lending, provided that at least authors obtain a remuneration for such lending. Member States shall be free to determine this remuneration taking account of their cultural promotion objectives. Where Member States do not apply the exclusive lending right provided for in Article 1 as regards phonograms, films and computer programs, they shall introduce, at least for authors, a remuneration. Member States may exempt certain categories of establishments from the payment of the remuneration referred to in paragraphs 1 and 2.

II. COMMENTARY The derogation applicable to the lending right does not achieve the same balance as the 6.65 presumption system provided for the rental right. The latter balanced the need for creators and performers to be remunerated with the need for producers to control the commercial exploitation of films. In the case of lending right, the need for creators to be remunerated is balanced with the need for the public to access works. For this reason, the exclusive right need not be maintained. Regarding the objects possibly covered by the derogation to the exclusive right, see under Article 2 at paragraph 6.20. Article 6 permits four departures from the exclusive rights stated in Article 1 regarding lending: 6.66 (1) the possibility of not granting the right to authorise and prohibit but only a remuneration right; (2) the possibility of providing only authors with the remuneration right substituted for the exclusive right; (3) the determination of the remuneration may take account of cultural promotion objectives (and no mention is made of the equity of the remuneration); and (4) some establishments may be exempted from the payment of the lending right.

1. Derogation from the exclusive right The possibility for Member States to replace the exclusive right of lending by a right to 6.67 remuneration, as stated in the first paragraph, helps to compromise the aim of a strong protection of right holders with the conditions and aims of public lending. The strict application of an exclusive right could indeed threaten the basic mission of public libraries: to offer all the public access to protected works that contribute to educational, scientific and cultural development. This objective

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also led the EU to introduce derogations to exclusive copyrights in cases where the right holders are not to be found (see Dir. 2012/28 on orphan works). Directive 2006/115 on rental right and lending right does not go that far, since a right to remuneration remains the principle, in the form of a compulsory licence.44 But the possibility of ruling out the right to prohibit fends off the deterring effect it could have. The transaction costs of an authorisation system would indeed prevent public libraries from gathering coherent collections.

2. Beneficiaries of the right to remuneration 6.68 The possibility to derogate from the exclusive right is supported by a necessary right to remuneration. But as regards phonograms, films and computer programs, the latter is only mandatory for authors. Member States may therefore rule out any remuneration for all other right holders. This discriminatory distinction can only be justified by the minimisation of the financial burden of the payment of the lending fee.45 6.69 Article 16(2) of Directive 2019/790 secures national schemes in which the remuneration is shared between publishers and writers. This probably comforts the practice of sharing the remuneration due for public lending of books between writers and publishers (well established e.g., in France, CPI Art. L. 133-4) since an analogical interpretation of the Reprobel case (C-572/13, 44–49) could endanger these schemes.

3. The consideration of cultural promotion objectives 6.70 The possibility for Member States to take account of cultural promotion objectives seems to allow a departure from the principle of the equitable remuneration depending on the actual use. However one needs to be cautious as the Court of Justice (C-271/10 VEWA v Belgische Staat, [43]) has stated that: Art. 5(1) of Council Directive 92/100/EEC [now Art. 6(1) of Dir. 2006/115] precludes legislation […] which establishes a system under which the remuneration payable to authors in the event of public lending is calculated exclusively according to the number of borrowers registered with public establishments, on the basis of a flat-rate amount fixed per borrower and per year.

6.71 The interpretation of the second paragraph is difficult as well. It seems that it is to be read as excluding the consideration of the cultural promotion objectives when the right to remuneration replaces the exclusive right in phonograms, films and computer programs,46 therefore allowing the consideration of cultural promotion objectives only for written works. This interpretation, discriminating among authors depending on the categories of their works or subject matter, goes against the principle of equal treatment of authors as stated in the Green Paper and finds no support in case law. 6.72 The consideration of cultural promotion objectives is probably the way to explain the fact that remuneration is mostly not paid by actual users but, at least partly,47 by the state budget, directly or via support to libraries.48

44 45 46 47 48

G. Tritton, Intellectual Property in Europe, Sweet & Maxwell, 2007, para. 4–066. H. Comte, ‘Une étape de l’Europe du droit d’auteur: la directive CEE du 19 novembre 1992 relative au prêt et à la location’, (1993) RIDA, 158, 3–73, 37. Comte, 39. See for example the French system where bookstores are bound as well: 6 per cent of the sales price is due to the collective management organisation collecting the public lending fees Art. L. 133–3 in fine Code de la propriété intellectuelle. F. Melichar, ‘Cultural policy and public lending right’, in Sofia, (ed.), Public Lending Right in the World, 245.

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ARTICLE 6: DEROGATION FROM THE EXCLUSIVE PUBLIC LENDING RIGHT

4. Exemption of certain categories of establishments Certain categories of establishments are not all public libraries, as the ECJ has had to state several 6.73 times. The implementation of the Directive in Spain (see C-36/05 Commission of the European Communities v Kingdom of Spain [2006] OJ C326/06 paras 7–8), Portugal (see C-53/05 Commission of the European Communities v Portuguese Republic [2006] OJ C212/06, para. 7), Ireland (see C-175/05 Commission of the European Communities v Ireland [2007] OJ C42/07, para. 4) and Italy (see C-198/05 Commission of the European Communities v Italian Republic [2006] OJ C326/06, para. 11) indeed gave rise to infringement proceedings initiated by the Commission on this issue. And four times the ECJ stated in very similar wording: ‘by exempting from the public lending right all [or almost all] categories of lending establishment accessible to the public within the meaning of Directive 92/100/EEC […], the [country] has failed to fulfill its obligations under Articles 1 and 5 of that Directive’ (now 1 and 6 of the Dir. 2006/115). The option chosen by those countries can be explained by the reluctance that Member States also had in the discussions in the drafting process: the state budget is mostly the debtor of this remuneration right. As stated in Recital 10, no remuneration is payable as regards lending on the premises and lending 6.74 between establishments accessible to the public, as well as when a copy is made available for the purpose of public performance or broadcasting.

NOTES 1. Related instruments Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC OJ L 130/92.

2. CJEU case law Commission of the European Communities v Ireland (C-175/05) [2007] OJ C42/07. Commission of the European Communities v Italian Republic (C-198/05) [2006] OJ C326/06. Commission of the European Communities v Kingdom of Spain (C-36/05) [2006] OJ C326/06. Commission of the European Communities v Portuguese Republic (C-53/05) [2006] OJ C212/06. Hewlett-Packard Belgium SPRL v Reprobel SCRL (C-572/13) [2015] ECLI:EU:C:2015:750. Vereniging van Educatieve en Wetenschappelijke Auteurs (VEWA) v Belgische Staat (C-271/10) [2011] OJ C252/11.

3. Bibliography Comte, H. ‘Une étape de l’Europe du droit d’auteur: la directive CEE du 19 novembre 1992 relative au prêt et à la location’, (1993) RIDA, 158, 3–73. Melichar, F. ‘Cultural policy and public lending right’, in Public Lending Right in the World, Sofia (ed.), 245. Tritton, G. Intellectual Property in Europe, Sweet & Maxwell, London, 2007.

CHAPTER II RIGHTS RELATED TO COPYRIGHT II. COMMENTARY As stated in the first recitals of the Directive of 1992, the economic development of the European 6.75 cultural industry was the important concern that the Directive intended to address. To this end, the Directive sought to grant the constant remuneration of all players involved in the creative chain and

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to improve the return on investment. This commanded that rights, or at least the right to remuneration, be granted not only to the creative contributors of cultural goods (as authors and performers are) but also to entrepreneurs of the cultural industry (such as producers of recordings and movies and broadcasting organisations). 6.76 Between the fixation right (Art. 6, Dir. 92/100) and the right to authorise or prohibit the broadcasting and communication to the public (Art. 8, Dir. 92/100), the Directive of 1992 provided for a reproduction right for performers, phonogram producers, film producers and broadcasting organisations (Art. 7). This article has been abrogated by Article 11 of the Information Society Directive (2001/29/EC). The reproduction right is meanwhile granted by Article 2 of Directive 2001/29 for authors, performers, producers and broadcasting organisations. The reproduction right also disappeared from Recital 5, which became Recital 3 in 2006, according to which the rights provided for in this Directive are ‘considered as being of fundamental importance for the economic and cultural development of the Community’ because of the increasing threat due to the piracy mentioned in the previous recital.

ARTICLE 7: FIXATION RIGHT 1. 2. 3.

Member States shall provide for performers the exclusive right to authorise or prohibit the fixation of their performances. Member States shall provide for broadcasting organisations the exclusive right to authorise or prohibit the fixation of their broadcasts, whether these broadcasts are transmitted by wire or over the air, including by cable or satellite. A cable distributor shall not have the right provided for in paragraph 2 where it merely retransmits by cable the broadcasts of broadcasting organisations.

II. COMMENTARY 6.77 Member States must implement a fixation right in favour of performers and broadcasting organisations. The overall and horizontal approach of this Directive required that the specific protection of rental and lending be supplemented with the more basic protection of performers. To this end, Chapter II introduces copyright protecting the first exploitation, as opposed to the first chapter that protects only secondary uses, since they cover only uses done with objects embodying the first exploitation (the reproduction of written works in books, or of recordings of music and films). Beside the general frame of limitations and exceptions as stated in the Directive on the information society, Article 10 of Directive 2006/115 provides for the possibility to limit the fixation right.

1. The fixation right for performers 6.78 The need for protection of performers appeared because of the development of recordings of performances and the consequent decrease of hiring contracts for live performances. The 1960s saw the climax of this development. The presence of the parallel protection of the reproduction right (now to be read in the 2001/29 Directive) in the version of 1992 made clear that the fixation right covers only the first fixation of the performance.

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ARTICLE 7: FIXATION RIGHT

Before Directive 1992/100, only the Rome Convention granted an international protection to 6.79 performers, requiring that performers be provided with ‘the possibility of preventing’ certain acts (Art. 7(1)). Some European countries already did,49 sometimes preceded by case law.50 As in the first chapter of the Directive, the choice has been made to require the introduction of an 6.80 exclusive right, as a high standard of protection. Member States may lower the protection of performers vis-à-vis producers of a film, as the rights of this chapter may be covered by a presumption of transfer (see Art. 3(6)). As in the case of presumptions transferring the rights of other creative participants in a film to its producer, if a similar presumption transfers the rights of fixation, broadcasting or communication and distribution of the performer, that performer does not lose the right to an equitable remuneration.

2. The fixation right for broadcasting organisations The protection of broadcasting organisations is to be understood as a parallel to the protection of 6.81 producers of sound recordings and films. The protection of the latter relies on the high investment required by the production of tradable objects embodying copyright-protected works. Similarly, the protection of broadcasting organisations is given in order to protect the production of the shows and objects broadcast, not in order to protect the broadcast as such. This explains why only this fixation right (and not the broadcasting and communication right) is granted to these organisations. The exclusion of cable operators calls to mind the exclusion of producers of videograms: only the 6.82 first broadcaster is protected. As such the cable operator is deemed in European copyright law only as a user (cf. Art. 9 Dir. on satellite and cable),51 except if it makes its own programmes. In such cases, the cable operator is then to be considered as a broadcasting organisation since it is then the first broadcaster.

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, OJ L 248/15, 6.10.1993. Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001. Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations of 26 October 1961.

2. Bibliography Reinbothe, J. and S. von Lewinski, The E.C. Directive on Rental and Lending Rights and on Piracy, 1st ed., Sweet & Maxwell, London, 1993.

49

50

51

See for example in Germany in the Urheberrechtsgesetz (UrhG) since 1965 (see ss. 73–83 UrhG), in Ireland since 1968 (see ss. 2(1), 3(1) and 5 Performers’ Protection Act), and in France since the Loi n° 85–660 du 3 juillet 1985 (see Arts 17–18 of this law, now codified in Art. L. 212-2 and 212-3 Code de la propriété intellectuelle). See for example the ‘Leistungsschutzurteile ’ of the German Bundesgerichtshof of 31 May 1960, BGHZ 33, 1, BGHZ 33, 20, BGHZ 33, 38, BGHZ 33, 48 and the Furtwängler case of the French Cour de cassation, Civ. 1, 4 January 1964, Bull. Civ. 1964, n° 17, about the protection of the interpretation of the conductor Wilhelm Furtwängler. For an overall presentation of national law before 1992, see Reinbothe and Lewinski, 137–80. On the background of this third para., see Reinbothe and Lewinski, 87–8.

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ARTICLE 8: BROADCASTING AND COMMUNICATION TO THE PUBLIC 1.

2.

3.

Member States shall provide for performers the exclusive right to authorise or prohibit the broadcasting by wireless means and the communication to the public of their performances, except where the performance is itself already a broadcast performance or is made from a fixation. Member States shall provide a right in order to ensure that a single equitable remuneration is paid by the user, if a phonogram published for commercial purposes, or a reproduction of such phonogram, is used for broadcasting by wireless means or for any communication to the public, and to ensure that this remuneration is shared between the relevant performers and phonogram producers. Member States may, in the absence of agreement between the performers and phonogram producers, lay down the conditions as to the sharing of this remuneration between them. Member States shall provide for broadcasting organisations the exclusive right to authorise or prohibit the rebroadcasting of their broadcasts by wireless means, as well as the communication to the public of their broadcasts if such communication is made in places accessible to the public against payment of an entrance fee.

II. COMMENTARY 6.83 Article 8 regulates the rights of broadcasting and communication to the public in phonograms, in favour of performers, phonogram producers and broadcasting organisations; it thereby implements Article 12 of the Rome Convention but grants a much broader protection. Further in the sense of a stronger protection, Recital 16 allows Member States to grant a broader protection only for this right; Member States are therefore free to grant more than a right to remuneration in case of broadcasting or communication to the public of phonograms, or to grant this remuneration right also for uses of any phonograms, not only the commercial ones. 6.84 Tacitly Article 8 gives a definition of the protected performance of a performer in the context of neighbouring rights: it is only the performance giving rise to the first fixation, and not the performance or broadcast of this first fixation. It does not matter whether this performance is done for a direct audience or only in the closed context of a recording in a studio. It further follows from Article 8(1) in fine and Article 8(2) that the exclusive right granted in Article 8 covers only the communication and the broadcasting of live performances (the communication need not be simultaneous, but it has to be the first communication following the performance itself). As soon as a former fixation or a former broadcast intervenes, Article 8 grants only a right to remuneration. 6.85 The reference to ‘wireless means’ aims at distinguishing general broadcast from cable retransmission. This mention is due to the fact that the legislative process of both this Directive and the Directive on satellite and cable retransmission were discussed in the same period. Through this precision the interplay of both Directives was made clear: the right to broadcast therefore covers satellite transmission but not cable retransmissions. The newest SatCab Directive (Dir. 2019/789, Recs 5 and 15) claims no interference with the rental and lending Directive.

1. Communication to the public 6.86 Regarding the concept of ‘communication to the public’, numerous cases have dealt with the definition given in Article 8(2) of Directive 92/100 (and 2006/115) as well as with the one given for a broader scope (not only in favour of performers) in Article 3(1) of Directive 2001/29. The SCF v Marco Del Corso case (C-135/10) explains in detail the interplay of both definitions (cf. Case C-135/10, [74–77]) and concludes that, ‘Article 8(2) of Directive 92/100, on the one hand, requires

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an individual interpretation of the concept of communication to the public. The same applies as regards the identity of the user and the question of the use of the phonogram at issue’. The specific feature of Directive 2006/115 is Article 8(2), regarding the compensatory nature 6.87 (C-135/10, [75]) of the ‘single equitable remuneration’ to be paid by the user who broadcasts or communicates to the public a phonogram that has been published for commercial purposes, and the obligation on the part of Member States to ensure that the fees paid by the user are shared between the ‘relevant performers and phonogram producers’.52 This chapter first concentrates on cases about the application of Article 8 of this Directive because there had been diverging interpretations, but in the Reha Training case, the Grand Chamber of the ECJ achieved a synthesis of the ‘several complementary criteria, which are not autonomous and are interdependent’ and ‘must be applied both individually and in their interaction with one another’ (C-117/15 [35]). These criteria must be assessed in the same way, independently of the relevant provision (Dir. 2001/29, Art. 3(1) and Dir. 2006/115, Art. 8(2), since the concept of ‘communication to the public’ has the same meaning in both Directives (C-117/15 [28, 33], C-753/18 [28]). 6.88

The SCF v Marco Del Corso case sums up the criteria as follows: [I]n order to assess whether a user is making a communication to the public within the meaning of article 8(2) […] the situation of a specific user and of all the persons to whom he communicates the protected phonograms must be assessed (C-135/10, [78]); […] account must be taken of several complementary criteria, which are not autonomous and are interdependent (C-135/10, [79]). […] it is for the national court to make an overall assessment of a given situation (C-135/10, [80]). […] [T]he public which is the subject of the communication is both targeted by the user and receptive, in one way or another, to that communication, and not merely ‘caught’ by chance (C-135/10, [91]).

After a thorough analysis of the situation of the proceeding, the Court stated (C-135/10, [102]) that: the concept of ‘communication to the public’ for the purposes of Article 8(2) of Directive 92/100 must be interpreted as meaning that it does not cover the broadcasting, free of charge, of phonograms within private dental practices engaged in professional economic activity, such as the one at issue in the main proceedings, for the benefit of patients of those practices and enjoyed by them without any active choice on their part. Therefore such an act of transmission does not entitle the phonogram producers to the payment of remuneration.

Another example found in the European case law dealt with services provided by a hotel in the 6.89 rooms of guests (PPL v Ireland, Case C-162/10). The Court applied the criteria as set out in the SCF v Marco del Corso case and stated regarding the ‘communication’ that: The user makes an act of communication when it intervenes, in full knowledge of the consequences of its action, to give access to a broadcast containing the protected work to its customers. In the absence of that intervention, its customers, although physically within the area covered by the broadcast, would not, in principle, be able to enjoy the broadcast work (C-162/10, [31] referring to C-135/10, [82]).

Then assessing the concept of ‘public’, it still referred to the SCF v Marco del Corso case and indicated that this concept ‘refers to an indeterminate number of potential listeners and a fairly large number of people’ (C-162/10, [33] referring to C-135/10, [84]).53 Lastly, it repeated, concerning the relation of definitions given in both Directives that:

52 53

Art. 8(2) is inspired by Art. 12 of the Rome Convention the wording of which it likewise reproduces almost verbatim (C-135/10, [73], C-245/00, [35]). See C-162/10, [34–35] for further assessment of these elements.

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Chapter 6 THE RENTAL AND LENDING RIGHTS DIRECTIVE if it is relevant that a ‘communication’ within the meaning of Article 3(1) of Directive 2001/29 is of a profit-making nature, this must be all the more true in the case of the essentially economic right to equitable remuneration of the performers and phonogram producers under Article 8(2) of Directive 2006/115 (C-162/10, [36] referring to C-135/10, [88–89]).

Consequently, ‘a hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal is a “user” making a “communication to the public”’ (C-162/10, [47]).54 6.90 It is not relevant whether the communication is done by providing televisions and/or radios to which the hotel distributes signals or by providing apparatus and phonograms in physical or digital form which may be played on or heard from such apparatus. Both are communications to be compensated by the equitable remuneration according to Article 8(2) (C-162/10, [69]).

2. Equitable remuneration 6.91 This ‘equitable remuneration’ for the secondary use of phonograms is to be read in Article 12 of the Rome Convention. 6.92 The European Court of Justice ruled as follows: the concept of equitable remuneration in Article 8(2) of Directive 92/100 must be interpreted uniformly in all the Member States and applied by each Member State; it is for each Member State to determine, in its own territory, the most appropriate criteria for assuring, within the limits imposed by Community law and Directive 92/100 in particular, adherence to that Community concept (C-245/00 SENA v NOS [38]).

6.93 Further regarding the appreciation of the equitable dimension of the remuneration, the Court urged the balance to be found (C-245/00, [46]), thereby confirming the common theme of the whole Directive: Article 8(2) of Directive 92/100 does not preclude a model for calculating what constitutes equitable remuneration for performing artists and phonogram producers that operates by reference to variable and fixed factors, such as the number of hours of phonograms broadcast, the viewing and listening densities achieved by the radio and television broadcasters represented by the broadcast organisation, the tariffs fixed by agreement in the field of performance rights and broadcast rights in respect of musical works protected by copyright, the tariffs set by the public broadcast organisations in the Member States bordering on the Member State concerned, and the amounts paid by commercial stations, provided that that model is such as to enable a proper balance to be achieved between the interests of performing artists and producers in obtaining remuneration for the broadcast of a particular phonogram, and the interests of third parties in being able to broadcast the phonogram on terms that are reasonable, and that it does not contravene any principle of Community law.

6.94 As regards trans-frontier communications, the Court stated: for determination of the equitable remuneration mentioned in [Art. 8(2) Dir. 2006/115], the broadcasting company is not entitled unilaterally to deduct from the amount of the royalty for phonogram use payable in the Member State in which it is established the amount of the royalty paid or claimed in the Member State in whose territory the terrestrial transmitter broadcasting to the first State is located. (C-192/04 Lagardère Active Broadcast v SPRE and Others, [55]).

This may raise complex questions of conflict of laws especially considering the territoriality principle ruling copyright law, but one can anyway strongly support this position of the Court according to

54

On this criterion of the user’s role, see C-117/15 [47, 54] and C 753/18 [32-35].

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the common law of contract where the debtor cannot unilaterally determine the interplay of different debts he has vis-à-vis different debtors. The mention of a single remuneration led in the preliminary ruling on hotel rooms to a question in 6.95 which the Court stated that the remuneration to be paid comes ‘in addition to that paid by the broadcaster’ (C-162/10, [55]), which seems fair since the use covered is the re-communication of the phonograms broadcast.

3. Beneficiaries The exclusive right of Article 8(1) is stated only in favour of performers whereas the right to 6.96 remuneration is to be shared between performers and producers. The manner in which that remuneration is shared between performing artists and producers of phonograms is normally to be determined by agreement between them. It is only if their negotiations do not produce agreement as to how to distribute the remuneration that the Member State must intervene to lay down the conditions (C-245/00, [33]).

The lack of provision about transferability is not to be interpreted as a non-transferability of this 6.97 right;55 on the contrary the possible application of the presumption in favour of a film producer speaks for the transferability of this right, just as the provided distribution of the fees for the secondary use of phonograms speaks for the common transfer of this right to the producer. Further, the preventive56 right to authorise and prohibit the rebroadcasting of their broadcasts as 6.98 well as the communication to the public is granted in favour of broadcasting organisations as well. This is in line with the objective to support investors in recouping their investment.

NOTES 1. Related instruments Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001. Directive 2019/789 of 17 April 2019 laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes, and amending Council Directive 93/83/EEC.

2. CJEU case law Föreningen Svenska Tonsättarees Internationella Musikbyra u.p.a. (STIM) & Svenska artisters och musikers intreseorganisation ek. för (SAMI v Fleetmanager Sweden AB & Nordisk Biluthyrning AB (C-753/18) [2020] ECLI:EU:C: 2020:268. Phonographic Performance (Ireland) Ltd (PPL) v Ireland, Attorney General (C-162/10) [2012] OJ C133/12. Reha Training Gesellschaft für Sport- und Unfallrehabilitation mbH v GEMA (C-117/15) [2016] ECLI:EU:C:2016:309.

3. Bibliography Torremans, P, ‘When the Court of Justice of the European Union sets about defining exclusive rights: Copyright, quo vadis?’ in Torremans (ed.), Research Handbook on Copyright Law, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2017.

55 56

The reason for this is rather the lack of concerns about this issue; cf. von Lewinski, 2010, 6.8.5. C-135/10, [75].

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ARTICLE 9: DISTRIBUTION RIGHT 1.

2. 3. 4.

Member States shall provide the exclusive right to make available to the public, by sale or otherwise, the objects indicated in points (a) to (d), including copies thereof, hereinafter “the distribution right”: (a) for performers, in respect of fixations of their performances; (b) for phonogram producers, in respect of their phonograms; (c) for producers of the first fixations of films, in respect of the original and copies of their films; (d) for broadcasting organisations, in respect of fixations of their broadcasts as set out in Article 7(2). The distribution right shall not be exhausted within the Community in respect of an object as referred to in paragraph 1, except where the first sale in the Community of that object is made by the rightholder or with his consent. The distribution right shall be without prejudice to the specific provisions of Chapter I, in particular Article 1(2). The distribution right may be transferred, assigned or subject to the granting of contractual licences.

II. COMMENTARY 6.99 The autonomous definition of the distribution right in the Directive introducing rental and lending rights has to be interpreted as a strong distinction between lending and rental on one hand and distribution (only related to the sale of copies) on the other. The distribution right only covers the first sale. This is to be read in Article 9(2) and has been clearly stated by the CJEU in Warner Brothers (Case 158/86, [19] and Metronome Music (Case C-200/96, [18–20]). 6.100 Cases dealing with the conformity of rental and lending rights with the free movement of goods in the internal market gave opportunities to reaffirm the second paragraph of Article 9. According to the Metronome case (C-200/96, [18–19]) regarding rental and the Commission v Portugal case (C-53/05, [34]) regarding lending, only the sale is affected by the exhaustion of the distribution right. More generally, the case law on the distribution right mostly refers to its statement in Article 4 of Directive 2001/29.57 6.101 The statement of the transferability, assignability and possibility of disposing of this right according to licences in Article 9(4) is confusing, as this is not stated in Articles 7 and 8 (a similar statement was made about the reproduction right in the 1992 version; cf. Art. 7.2). Also, the reference to only Article 7(2) as regards broadcasting organisations in Article 9(1)(d) can be misleading since the broadcasting organisations are defined in Article 7(3) as well (excluding cable operators). Both passages are to be considered as results of the legislative process. The transferability of neighbouring rights has been a concern for some Member States only as regards the distribution right, and is only for this reason mentioned here and not systematically in the other provisions of this chapter. The omission of Article 7(3) only bears witness to the adding of the exclusion of cable operators after the text of Article 9(1) obtained consensus. 6.102 It is noteworthy that the distribution right is the only copyright-related right of this Directive also vesting in the persons of film producers, thereby stressing the need to control the dissemination and market accesses underlying the protection of film producers in this Directive. In the course of a preliminary ruling about the freedom of using a music sample (in that case of the German group 57

See, for example, C-236/18.

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ARTICLE 10: LIMITATIONS TO RIGHTS

Kraftwerk), the CJEU stated ‘the concept of “copy” within the meaning of Article 9(1)(b) of Directive 2006/115 must be interpreted consistently with the same concept as it is used in Article 1(c) and Article 2 of the Geneva Convention’ (C-476/17 [54]) and ‘must be interpreted as meaning that a phonogram which contains sound samples transferred from another phonogram does not constitute a “copy”, within the meaning of that provision, of that phonogram, since it does not reproduce all or a substantial part of that phonogram’ (C-476/17 [55]).

NOTES 1. Related instruments Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001.

2. CJEU case law Commission of the European Communities v Portuguese Republic (C-53/05) [2006] OJ C212/06. Metronome Musik v Music Point Hokamp (C-200/96) [1998] ECR I-1953. Nederlands Uitgeversverbond, Groep Algemene Uitgevers v Tom Kabinet Internet BV, Tom Kabinet Holding BV, Tom Kabinet Uitgeverij BV, Case C-263/18 [2019], ECLI:EU:C:2019:1111. Pelham GmbH, Moses Pelham, Martin Haas v Ralf Hütter, Florian Schneider-Esleben (aka Kraftwerk), C-476/17 [2019] ECLI:EU:C:2019:624. Warner Brothers Inc. and Metronome Video ApS v Erik Viuff Christiansen (Case 158/86) [1988] ECR 2605.

ARTICLE 10: LIMITATIONS TO RIGHTS 1.

2.

3.

Member States may provide for limitations to the rights referred to in this Chapter in respect of: (a) private use; (b) use of short excerpts in connection with the reporting of current events; (c) ephemeral fixation by a broadcasting organisation by means of its own facilities and for its own broadcasts; (d) use solely for the purposes of teaching or scientific research. Irrespective of paragraph 1, any Member State may provide for the same kinds of limitations with regard to the protection of performers, producers of phonograms, broadcasting organisations and of producers of the first fixations of films, as it provides for in connection with the protection of copyright in literary and artistic works. However, compulsory licences may be provided for only to the extent to which they are compatible with the Rome Convention. The limitations referred to in paragraphs 1 and 2 shall be applied only in certain special cases which do not conflict with a normal exploitation of the subject matter and do not unreasonably prejudice the legitimate interests of the rightholder.

II. COMMENTARY This provision is to be read as the forerunner of the exceptions catalogue of Directive 2001/29 and 6.103 its famous three-step test. As this latter Directive provides for a comprehensive system, the reader should refer to its comment.

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Chapter 6 THE RENTAL AND LENDING RIGHTS DIRECTIVE

6.104 In the course of a preliminary ruling on the definition of communication to the public the ECJ stated, concerning the private use for which Member States may provide a limitation (Art. 10(1)a), that if the criteria are fulfilled for a use to consist of a communication to the public, the ‘private’ attribute one could consider applicable does not constitute an exemption from the obligation to pay the equitable remuneration (C-162/10, [70–77]). On quotation, that the reference of Art. 10(2) allows Member States to introduce regarding related rights provided for in Article 9 of the Directive, the CJEU stated: where the creator of a new musical work uses a sound sample taken from a phonogram which is recognisable to the ear in that new work, the use of that sample may, depending on the facts of the case, amount to a ‘quotation’, on the basis of Article 5(3)(d) of Directive 2001/29 read in the light of Article 13 of the Charter, provided that that use has the intention of entering into dialogue with the work from which the sample was taken, within the meaning referred to in paragraph 71 above, [or the purposes of illustrating an assertion, of defending an opinion or of allowing an intellectual comparison between that work and the assertions of that user] and that the conditions set out in Article 5(3)(d) are satisfied (C-476/17, [72]).

NOTES 1. Related instruments Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001.

2. CJEU case law Pelham GmbH, Moses Pelham, Martin Haas v Ralf Hütter, Florian Schneider-Esleben (aka Kraftwerk), C-476/17 ECLI:EU:C:2019:624. Phonographic Performance (Ireland) Ltd (PPL) v Ireland, Attorney General (C-162/10) [2012] OJ C133/12.

CHAPTER III COMMON PROVISIONS ARTICLE 11: APPLICATION IN TIME 1.

2. 3.

4. 5.

This Directive shall apply in respect of all copyright works, performances, phonograms, broadcasts and first fixations of films referred to in this Directive which were, on 1 July 1994, still protected by the legislation of the Member States in the field of copyright and related rights or which met the criteria for protection under this Directive on that date. This Directive shall apply without prejudice to any acts of exploitation performed before 1 July 1994. Member States may provide that the rightholders are deemed to have given their authorisation to the rental or lending of an object referred to in points (a) to (d) of Article 3(1) which is proven to have been made available to third parties for this purpose or to have been acquired before 1 July 1994. However, in particular where such an object is a digital recording, Member States may provide that rightholders shall have a right to obtain an adequate remuneration for the rental or lending of that object. Member States need not apply the provisions of Article 2(2) to cinematographic or audiovisual works created before 1 July 1994. This Directive shall, without prejudice to paragraph 3 and subject to paragraph 7, not affect any contracts concluded before 19 November 1992.

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ARTICLE 14: REPEAL

6.

7.

Member States may provide, subject to the provisions of paragraph 7, that when rightholders who acquire new rights under the national provisions adopted in implementation of this Directive have, before 1 July 1994, given their consent for exploitation, they shall be presumed to have transferred the new exclusive rights. For contracts concluded before 1 July 1994, the unwaivable right to an equitable remuneration provided for in Article 5 shall apply only where authors or performers or those representing them have submitted a request to that effect before 1 January 1997. In the absence of agreement between rightholders concerning the level of remuneration, Member States may fix the level of equitable remuneration.

II. COMMENTARY The postponements of the entry into force are the results of compromises necessitated by the 6.105 contracts concluded before the Directive came into force, and by the new rights such as the required authorship of the principal director of a film (Art. 2(2)) and the introduction of unwaivable rights to remuneration.58

ARTICLE 12: RELATION BETWEEN COPYRIGHT AND RELATED RIGHTS Protection of copyright-related rights under this Directive shall leave intact and shall in no way affect the protection of copyright.

II. COMMENTARY This repeats the first Article of the Rome Convention, in force in all EU Member States, except 6.106 Malta.

ARTICLE 13: COMMUNICATION Member States shall communicate to the Commission the main provisions of national law adopted in the field covered by this Directive.

ARTICLE 14: REPEAL Directive 92/100/EEC is hereby repealed, without prejudice to the obligations of the Member States relating to the time-limits for transposition into national law of the Directives as set out in Part B of Annex I. References made to the repealed Directive shall be construed as being made to this Directive and should be read in accordance with the correlation table in Annex II.

58

For a presentation of the legislative process, see Reinbothe and Lewinski, 117–29.

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II. COMMENTARY 6.107 The original Directive in this field, which is codified by the Directive under discussion and which is replaced by it, is logically also being repealed. That act does not take away however the obligation that rested on Member States to implement the Directive.

ARTICLE 15: ENTRY INTO FORCE This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

ARTICLE 16: ADDRESSEES This Directive is addressed to the Member States.

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7 THE SATELLITE AND CABLE DIRECTIVE Jan Rosén COUNCIL DIRECTIVE 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission

[1993] OJ L 248/5 ARTICLE 5: RELATION BETWEEN COPYRIGHT AND RELATED RIGHTS

CHAPTER I: DEFINITIONS ARTICLE 1: DEFINITIONS I.

COMMENTARY 1. Introduction 2. Definition of a ‘satellite’ (art. 1(1)) 3. Communication to the public (art. 1(2)(a)) 4. The act of communication to the public occurs solely in one Member State (art. 1(2)(b)) 5. Encryption of signals (art. 1(2)(c)) 6. Extension of the communication to the public definition – satellite broadcasts from outside the EU (art. 1(2)(d)) 7. Cable retransmission (art. 1(3)) 8. Collecting society (art. 1(4))

7.01 7.01 7.07 7.12

7.17 7.20

COMMENTARY 1. Acquisition by contract (art. 3(1)) 2. Collective licensing (art. 3(2)) 3. Cinematographic works (art. 3(3)) 4. Duty to inform (art. 3(4))

COMMENTARY 1. Related rights (art. 4(1)) 2. Wireless broadcasting (art. 4(2)) 3. Presumption of transfer (art. 4(3))

COMMENTARY 1. Minimum harmonisation (art. 6(1)) 2. Focus on up-link country (art. 6(2))

7.52 7.52 7.53

ARTICLE 7: TRANSITIONAL PROVISIONS I.

I. 7.34 7.34

COMMENTARY 1. Application in time (art. 7(1)) 2. Transitional provisions for old contracts (art. 7(2)) 3. Transitional provisions for co-production agreements (art. 7(3))

7.55 7.55 7.58 7.60

COMMENTARY 1. Acquisition of cable retransmission rights (art. 8(1)) 2. Transitional provisions (art. 8(2))

7.63 7.63 7.67

ARTICLE 9: EXERCISE OF THE CABLE RETRANSMISSION RIGHT 7.37 7.37 7.40 7.43 7.44

ARTICLE 4: RIGHTS OF PERFORMERS, PHONOGRAM PRODUCERS AND BROADCASTING ORGANISATIONS I.

I.

ARTICLE 8: CABLE RETRANSMISSION RIGHT

ARTICLE 3: ACQUISITION OF BROADCASTING RIGHTS I.

7.51

CHAPTER III: CABLE RETRANSMISSION

ARTICLE 2: BROADCASTING RIGHT COMMENTARY 1. An exclusive broadcasting right in the country-of-origin (art. 2)

COMMENTARY

ARTICLE 6: MINIMUM PROTECTION

7.25 7.27 7.32

CHAPTER II: BROADCASTING OF PROGRAMMES BY SATELLITE I.

I.

I.

COMMENTARY 1. Mandatory collective rights management (art. 9(1)) 2. Treatment of outsiders (art. 9(2)) 3. Statutory presumptions (art. 9(3))

7.68 7.68 7.71 7.73

ARTICLE 10: EXERCISE OF THE CABLE RETRANSMISSION RIGHT BY BROADCASTING ORGANISATIONS 7.45 7.45 7.48 7.49

I.

COMMENTARY 1. Broadcasters’ exception (art. 10)

7.74 7.74

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Chapter 7 THE SATELLITE AND CABLE DIRECTIVE ARTICLE 11: MEDIATORS I.

COMMENTARY 1. Set up of a mediation system (art. 11(1)) 2. Mediation procedure (art. 11(2) and (3)) 3. Independence and impartiality of mediators (art. 11(4))

7.76 7.76 7.78 7.79

I.

COMMENTARY 7.80 1. Obligation to negotiate – but not to grant a licence (art. 12(1)) 7.80 2. Transitional provisions (art. 12(2) and (3)) 7.83

COMMENTARY 1. National rules unaffected (art. 13)

7.84 7.84

ARTICLE 14: FINAL PROVISIONS I.

ARTICLE 12: PREVENTION OF THE ABUSE OF NEGOTIATING POSITIONS I.

ARTICLE 13: COLLECTIVE ADMINISTRATION OF RIGHTS

COMMENTARY 1. Implementation deadline and duty of notification (art. 14(1) and (2)) 2. Report of the Commission (art. 14(3))

7.86 7.86 7.87

ARTICLE 15 I.

CHAPTER IV: GENERAL PROVISIONS

COMMENTARY 1. No direct effect (art. 15)

7.89 7.89

CHAPTER I: DEFINITIONS ARTICLE 1: DEFINITIONS 1.

2.

For the purpose of this Directive, “satellite” means any satellite operating on frequency bands which, under telecommunications law, are reserved for the broadcast of signals for reception by the public or which are reserved for closed, point-to-point communication. In the latter case, however, the circumstances in which individual reception of the signals takes place must be comparable to those which apply in the first case. (a) For the purpose of this Directive, “communication to the public by satellite” means the act of introducing, under the control and responsibility of the broadcasting organization, the programme-carrying signals intended for reception by the public into an uninterrupted chain of communication leading to the satellite and down towards the earth. (b) The act of communication to the public by satellite occurs solely in the Member State where, under the control and responsibility of the broadcasting organization, the programme-carrying signals are introduced into an uninterrupted chain of communication leading to the satellite and down towards the earth. (c) If the programme-carrying signals are encrypted, then there is communication to the public by satellite on condition that the means for decrypting the broadcast are provided to the public by the broadcasting organisation or with its consent. (d) Where an act of communication to the public by satellite occurs in a non-Community State which does not provide the level of protection provided for under Chapter II, (i) if the programme-carrying signals are transmitted to the satellite from an uplink situation situated in a Member State, that act of communication to the public by satellite shall be deemed to have occurred in that Member State and the rights provided for under Chapter II shall be exercisable against the person operating the uplink station; or (ii) if there is no use of an uplink station situated in a Member State but a broadcasting organization established in a Member State has commissioned the act of communication to the public by satellite, that act shall be deemed to have occurred in the Member State in which the broadcasting organization has its principal establishment in the Community and the rights provided for under Chapter II shall be exercisable against the broadcasting organization.

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ARTICLE 1: DEFINITIONS

3.

4. 5.

For the purposes of this Directive, “cable retransmission” means the simultaneous, unaltered and unabridged retransmission by a cable or microwave system for reception by the public of an initial transmission from another Member State, by wire or over the air, including that by satellite, of television or radio programmes intended for reception by the public, regardless of how the operator of a cable retransmission service obtains the programme-carrying signals from the broadcasting organization for the purpose of retransmission. For the purposes of this Directive “collecting society” means any organization which manages or administers copyright or rights related to copyright as its sole purpose or as one of its main purposes. For the purposes of this Directive, the principal director of a cinematographic or audiovisual work shall be considered as its author or one of its authors. Member States may provide for others to be considered as its co-authors.

I. COMMENTARY 1. Introduction The Council Directive 93/83/EEC on satellite broadcasting and cable retransmission (the Direct- 7.01 ive) in force since 1 January 1995, has a certain and quite limited ambit, namely to foster pan-European broadcasting services by facilitating satellite broadcasting and cable retransmission of radio and television programmes. The aim is basically to facilitate the cross-border transmission of audiovisual programmes, specifically by broadcasting via satellite and retransmission by cable. For satellite broadcasting, the Directive establishes that the copyright-relevant act takes place merely in the country of origin of the broadcast. In the case of simultaneous cable retransmissions, the Directive introduced a collective management of the rights. The Directive is a counterpart to the Television without Frontiers Directive of 1989, which has 7.02 similar objectives with respect to clearing barriers in the field of broadcasting and advertising law, but which has nothing to say about copyright matters.1 The TWF primarily aims to ensure the free movement of broadcasting services within the internal market and at the same time to preserve certain public interest objectives, such as cultural diversity, the right of reply, consumer protection and the protection of minors.2 It may also be observed initially, that several provisions of this Directive are closely interrelated to the norms and achieved goals of Directive 92/100 on rental and lending. Further, Directive 2001/29 on copyright in the information society, the InfoSoc Directive,3 has 7.03 eventually effectively harmonised all economic rights with respect to acts of public communication ‘by wire or by wireless means’, whereby Article 3 of that Directive encompasses not only broadcasting, but also cablecasting, cable retransmission, webcasting and IP-TV. That said, it should be observed that online activities are not at all covered by the Directive 93/83/EEC, but by a new additional Directive, the so-called NetCab Directive, as shown below.

1

2

3

Council Dir. 552/89/EEC of 3 October 1989 on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the pursuit of television broadcasting activities, OJ L 298/23, as later amended. The Commission was considering a modernisation of the Directive in the Consultation of 24 August 2015 to 16 November 2015, called Shaping Europe’s digital future, mostly to gather input on the evaluation process in order to assess the current rules and to seek views on an extension of the Directive. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society.

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7.04 As indicated in Article 14(3) of the Directive the Commission has had the duty to evaluate the Directive in a report no later than 1 January 2001, but which was actually effectuated on 26 July 2002.4 The report goes beyond an analysis of the implementation process and examines also the practical application of the Directive, thus an important part of the sources to this commentary. However, since then, new technological and business models for content distribution have merged, and the Commission has assessed the functioning of the Directive, also by means of a public consultation.5 This work paved the way in 2019 for the the separate and altogether new NetCab Directive on online transmissions and retransmissions of television and radio programmes, thus adding to the Directive. 7.05 The new 2019/789/EU NetCab Directive shall be implemented in the Member States by 7 June 2021.6 The objective of the NetCab Directive is to promote cross-border provision and access of online services ancillary to broadcasts, and to facilitate digital retransmissions over closed networks of TV and radio programmes originating in other Member States, by adapting the EU legal framework. Hence it complements the Directive 93/83/EEC, which already facilitates cross-border satellite broadcasting and retransmission by cable of TV and radio programmes from other Member States, but does not cover online activities such as IP-TV and the like. Furthermore, the provisions of the Directive concerning retransmissions of television and radio programmes from other Member States are limited to simultaneous, unaltered and unabridged retransmission by cable or microwave systems and do not cover retransmissions by means of other technologies. By addressing the imminent difficulties related to the clearance of rights, the RTV Directive creates the conditions allowing broadcasters and operators of retransmission services to offer wider access to radio and TV programmes across the EU than the Directive 93/83/EEC can offer. 7.06 The CJEU found in the SGAE case [30]7 that this Directive called for minimum harmonisation, as it had already stated in the CJEU case Egeda, [17].8 Logically, Recital 24 of the Directive stresses, on the one hand, that the harmonisation of legislation envisaged in the Directive entails ensuring a high level of protection of authors, performers, phonogram producers and broadcasting organisations, but, on the other hand, that such harmonisation should not allow a broadcasting organisation to take advantage of differences in levels of protection by relocating activities, to the detriment of audiovisual productions.

2. Definition of a ‘satellite’ (art. 1(1)) 7.07 For its purposes, Directive 93/83EEC defines ‘satellite’ in a way very significant for its times, developed as it was during the 1980s to emerge in the relevant definition around 1990. The term embraces both satellite broadcasting on frequencies for satellite broadcasting and communications satellites using other frequencies, thus encompassing so called Direct Broadcasting Satellites as well as Fixed Service Satellites. In short, the Directive applies to satellites the signals of which can be publicly received, irrespective of the frequency bands on which they are operating.

4

5

6

7 8

Report from the Commission on the application of Council Dir. 93/83/EEC on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission of 26 July 2002, COM (2002) 0430 final. The Commission was considering a modernisation of the Directive in the Consultation of 24 August 2015 to 16 November 2015, called Shaping Europe’s digital future, mostly to gather input on the evaluation process in order to assess the current rules and to seek views on an extension of the Directive. Directive (EU) 2019/789 of the European Parliament and of the Council of 17 April 2019 laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes, and amending Council Directive 93/83/EEC; the NetCab Directive. C-306/05, ECLI:EU:2006:764, SGAE. C-293/98, ECLI:EU:C:2000:66, Egeda v Hostelería.

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ARTICLE 1: DEFINITIONS

Recital 6 demonstrates that those technical distinctions of a ‘satellite’ are of little or no value from a 7.08 copyright law perspective, but merely something that was of some relevance in the early 1990s. Recital 6 says that ‘a distinction is currently drawn for copyright purposes between communication to the public by direct satellite and communication to the public by a communications satellite’, but ‘since individual reception is possible and affordable nowadays with both types of satellites, there is no longer any justification for this differing treatment’. A decisive element is whether signals transmitted by satellite can be received by the general public. A 7.09 satellite does not qualify as a ‘satellite’ within the meaning of paragraph 1 if its signals cannot be received by the general public, but solely by use e.g., of professional equipment. According to the CJEU decision in the Lagardère case,9 the provisions of the Directive did not apply if a communications satellite was used to transmit encoded signals that could be received by use of equipment available merely for professionals. Eventually, there is a more modern clarification offered by the CJEU about the nature of ‘the public’ 7.10 criterion.10 Further, the CJEU has eventually tested its impact on not so traditional methods for transmission of signals, in particular as concerns the so-called ‘direct injection’ of a signal, which adds to the Lagardère case. Direct injection is a process more and more used by broadcasting organisations to communicate their programmes to the public. Instead of sending them directly to the public by wireless means or by cable, they would nowadays more or less regularly transmit programmes to an intermediary for further transmittance to the public. In the SBS Belgium case the CJEU stated that a broadcasting organisation does not carry out an act of communication to the public, within the meaning of Article 3(1) of the InfoSoc Directive, when it transmits its programme-carrying signals exclusively to signal distributors without those signals being accessible to the public, unless the intervention of the distributors in question is just a technical means.11 Moreover, the new NetCab Directive offers in Article 2.4, in some connection to the SBS Belgium 7.11 decision of the CJEU, a definition of direct injection, saying that it means a technical process by which a broadcasting organisation transmits its programme-carrying signals to an organisation other than a broadcasting organisation, in such a way that the programme-carrying signals are not accessible to the public during the transmission. Reversely, this means that if such ‘other organisation’, having received programmes by directly injected signals from a broadcaster and ultimately transmits those signals to the public, there factually is a communication to the public, which the broadcaster as well as the distributor effectuates and for which they, accordingly, both have to get permission from the right holders. Arguably, a broadcaster sending signals by use of a satellite, but which signals are ultimately transmitted via other organisations, does not fall under the norms of the Directive.

3. Communication to the public (art. 1(2)(a)) First, satellite broadcasting is seen as a unitary act, performed by a broadcasting organisation, which 7.12 leads to a communication to the public if it encompasses the actual up-link to the satellite, the introduction of the signals, followed by the down-link, the transmission from the satellite back towards the earth. The uninterrupted communication presupposes a ‘closed communications system of which the satellite forms the central, essential and irreplaceable element’ (italics added), as stated

9 10 11

See Case C-192/04, ECLI:EU:C:2005:475, Lagardère Active Broadcast v Société pour la Perception del la rémunération équitable (SPRE) and Others, at para 39. See e.g., Case C-162/10, ECLI:EU:C:2012:141, Phonographic Performance; C-138/16, ECLI:EU:C:2017:218, AKM; C-641/15, ECLI:EU:C:2017:131, Verwertungsgesellschaft Rundfunk; C-161/17, ECLI:EU:C:2018:634, Renckhoff. See Case C-325/14, ECLI:EU:2015:764, SBS Belgium.

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by the CJEU in the Lagardère case.12 In the event of malfunction of the satellite, the CJEU concludes, the transmission of signals is technically impossible and, as a result, the public receives no broadcast. 7.13 Hence, a terrestrial system for broadcasting, e.g., via optical fibres or hertzian waves, using a satellite as a non-essential or parallel component, falls outside the Directive’s scope of application. This also indicates that the chain of communication from the studio to transmitter and further to the satellite’s up-link and down-link may not be interrupted by adding content to the signals – e.g., by advertisements – or by storing the signals and then retransmitting them after a certain delay. However, as said in Recital 14 of the Directive, ‘normal technical procedures relating to the programme-carrying signals should not be considered as interruptions to the chain of broadcasting’, which would also encompass the use of series of satellites. Still, it would be considered an interruption if retransmission is facilitated by an independently operated satellite platform. 7.14 Second, this has to be performed under the control and responsibility of the broadcasting organisation. In practice this means that the signals must be introduced under such control, but in technical terms the further transmittance can be effectuated by a third party. TV programmes or broadcast content may be produced by someone other than the broadcasting organisation as well as the effectuation of the up-link and down-link transmittance. Hence, an organisation that merely takes care of the signal transmittance in a technical meaning is not a broadcaster for the purposes of this Directive. This falls in line with recent CJEU case law stating that ‘mere technical means’ to ensure or improve reception of a transmission in its catchment area does not constitute communication to the public within the meaning of Article 3(1) of Directive 2001/29.13 7.15 Third, the introduction of signals must be intended for the reception by the public, i.e., such intention must have a bearing on the signals as such, not necessarily the media content. The notion of ‘public’ is still somewhat blurred in the EU context, but clearly it does not depend on whether members of the public are actually receiving the signals, e.g., by turning on their TV sets. Further, it is clear that if the signals introduced in a transmittance manoeuvre via satellite can only be received by a specific terrestrial transmitter – possibly for a subsequent broadcast to the public – this is not a communication to the public within the frames of the Directive; cf. above what is said about ‘direct injection’. 7.16 It should be observed that the Directive has not only been added to by Directive 2019/789, but also been superseded by Directive 2001/21 to a certain extent as Article 3(1) of the latter Directive provides for a more generally phrased right of communication to the public that certainly includes acts of satellite broadcasting. Also, as mentioned above, CJEU case law has at least offered a more precise notion of ‘the public’ than the one used in the Directive 2001/29, e.g., referring to an indeterminate number of potential recipients, implying a fairly large number of persons, and, specifically, encompassing a cumulative effect of making works available to potential recipients

12

13

Case C-192/04, ECLI:EU:C:2005:475, Lagardère Active Broadcast v Société pour la Perception del la rémunération équitable (SPRE) and Others. The CJEU hereby refers at paras 31 and 38 to C-89/04, ECLI:EU:C:2005:348, Mediakabel. For the definition of ‘public’ there are numerous relevant references, now developed further in more recent decisions, see footnote 11 above, but see also C-228/10, ECLI:EU:C:2012:6, Union of European Football Associations (UEFA) and British Sky Broadcasting Ltd v Euroview Sport Ltd (OJ C 65, 3.3.2012); C-431/09, ECLI:EU:C:2011:648, Airfield NV and Canal Digitaal BV v Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (Sabam) and C-432/09, ECLI:EU: C:2011:157, Airfield NV v Agicoa Belgium BVBA; C-277/10, ECLI:EU:C:2012:65, Martin Luksan v Petrus van der Let. Cf. C-607/11, ECLI:EU:C:2013:147, ITV Broadcasting v TVCatchup, para 28; C-403/08 and C-429/08, ECLI:EU: C:2011:631, Football Association Premier League and Others, para 194; C-431/09 and C-432/09, ECLI:EU:C:2011:648, Airfield, paras 74 and 79.

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allowing for individuals to have access to protected media content successively.14 Again, acts of satellite broadcasting are typically to the public, provided the unitary act of an uninterrupted chain of communication is not directed solely to a specific professional receiver.15 The matter of communication to the public will be further commented on under Article 2 below.

4. The act of communication to the public occurs solely in one Member State (art. 1(2)(b)) This is the main rule of the Directive! It provides a country of origin rule by stating that the 7.17 communication to the public is relevant only in the Member State where the signals originate, as described in Article 1(2)(a). In practice, this is a choice-of-law rule, but it is still a provision of substantive law, not a conflicts rule. It clarifies, as a matter of Community law, that acts of satellite broadcasting only occur in the country of origin of the signal – it does not designate the national law that applies to an act of satellite broadcasting. Further, it effectively blocks Member States from applying national rules in territories of reception within the footprint of the satellite broadcast. On the basis of copyright law this rule implies that a broadcasting organisation needs to acquire 7.18 licences for the broadcast only from right holders in the up-link country, i.e., in the Member State of the origin of the signal. However, as said in Recital 17 to the Directive, ‘the parties should take account of all aspects of the broadcast, such as the actual audience, the potential audience and the language version’. Obviously, as for the amount of payment to be made for the rights acquired, the Directive does not want to bar contracting parties from adjusting licence fees etc. by taking account of the size and implications of the footprint of the satellite broadcast and the territories/countries reached. The main rationale of the rule lies in its barring right owners from dividing the communication to 7.19 the public by a satellite broadcast into separate territorial parts, thus creating an internal market by paving the way for trans-frontier satellite broadcasting in a unitary act. However, methods for encryption and use of other technical devices may factually sidestep the major aim of the Directive; see next paragraph.

5. Encryption of signals (art. 1(2)(c)) This rule makes it clear that communication to the public may come about even if the satellite 7.20 signals are encrypted, namely on the condition that the means for decrypting the broadcast are provided to the public by the broadcasting organisation or with its consent. Hereby, pay television services, based on encrypted satellite broadcasts, clearly fall within the frames of the Directive. The consent of the broadcasting organisation, set as a condition for the decryption to have the said effect, is meant to prevent unjustified application of the Directive’s country of origin rule by sale of illegal decoders. The Directive’s country of origin rule and its obvious aims for the EU market does not prevent right 7.21 holders and contracting partners agreeing on avoiding reception by the general public in certain countries by applying encryption or other technical means with such effects. If availability of decoders is effectively limited in such countries, a certain territorial exclusivity may still be achieved.

14 15

See C-607/11, ECLI:EU:C:2013:147, TVCatchup, paras 32–37; C-306/05, ECLI:EU:C:2006:764, SGAE, paras 37 and 38. Regarding the meaning of the term public in the context of the Directive, see C-89/04, ECLI:EU:C:2005:348, Mediakabel, para 30.

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7.22 However, it is difficult for broadcasting organisations to effectively prevent importation of decoders from countries, for which specific decoders are designated, into countries for which the decoder cards are not designated, even if legislation in the import country would allow for legal action against importers of such decoder cards. The CJEU tried this in the joint cases Premiere League/Murphy.16 The CJEU states, at paragraph 87, it may be that access to satellite transmission services requires possession of decoder cards, ‘whose supply is subject to the contractual limitation that it may be used only in the Member State of broadcast’. If the national legislation concerned prevents such services, i.e., satellite broadcasts, ‘from being received by persons resident outside the Member State of broadcast, in this instance those resident in the United Kingdom. Consequently that legislation has the effect of preventing those persons from gaining access to those services’. 7.23 The CJEU found that Article 3(2) of Directive 98/84, ‘the Conditional Access Directive’17 does not preclude national legislation which prevents the use of foreign decoding devices, including those procured or enabled by the provision of a false name and address or those used in breach of a contractual limitation permitting their use only for private purposes, since such legislation does not fall within the field coordinated by that Directive. However, Article 56 TFEU would preclude legislation of a Member State which makes it unlawful to import into and sell and use in that State foreign decoding devices which give access to an encrypted satellite broadcasting service from another Member State that includes subject matter protected by the legislation of that first State. 7.24 This conclusion was affected neither by the fact that the foreign decoding device has been procured or enabled by the giving of a false identity and a false address, with the intention of circumventing the territorial restriction in question, nor by the fact that it is used for commercial purposes although it was restricted to private use.

6. Extension of the communication to the public definition – satellite broadcasts from outside the EU (art. 1(2)(d)) 7.25 This rule wants to hinder circumvention of the Directive by location of the up-link satellite broadcasts, designated for EU countries, to countries outside the EU, possibly offering a lower degree of copyright protection to broadcast content. It does so by extending the scope of the Directive to broadcasts from outside of the EU, but under a number of prerequisites: (1)

(2) (3)

Either the introduction of the signal starting the uninterrupted communication is located to a country outside of the EU – broadcasts from other EU countries are basically not covered by this exception rule – or a broadcasting organisation established in the EU has commissioned the transmission from outside of the EU; The communication shall be deemed to have occurred in the Member State where the up-link has taken place or where the broadcasting organisation is established; As this rule generally wants to prevent broadcasting organisation policies from letting the communication to the public by satellite occur in a non-Community State which does not provide the level of protection established by the Directive, it applies only if the introduction to the up-link occurs in such a State.

7.26 In consequence, this rule offers a legal fiction pertaining to a satellite broadcast from outside of the EU to occur in a certain EU country and thus offering an opportunity for right owners to state claims based on copyright directed to a broadcaster established in the EU. Satellite broadcasts from

16 17

C-403/08 and C-429/08, ECLI:EU:C:2011:631, Football Association Premiere League Ltd and Karen Murphy v Media Protection Services Ltd. Directive 98/84/EC of the European Parliament and of the Council of 20 November 1998 on the legal protection of services based on, or consisting of, conditional access (OJ 1998 L 320/54; ‘the Conditional Access Dir.’).

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outside the EU, not covered by Article 1(2)(d), fall under the legislation of each Member State where reception of the broadcast occurs. In the latter case Member States are free to apply the so called Bogsch Theory, or Reception Theory, meaning that satellite broadcasting is a relevant act in all countries within the footprint of the satellite.18 For the sake of clarity it may be stressed again that mere reception of a broadcast as such is not a copyright relevant act, at least not according to the Directive. However, as was just stated, satellite signals from countries outside the EU may be acts of communication to the public in the countries of reception within the EU to be dealt with by national legislation in each country; hence the Directive doesn’t offer a regulation for such broadcasts.

7. Cable retransmission (art. 1(3)) This rule offers a definition of cable retransmission that is of great importance to the norms given in 7.27 Chapter III below, in particular as it considerably limits the scope of application of those norms. First, the notion of cable retransmission relates only to initial transmission from one Member State 7.28 to another, thus leaving out solely national retransmission operations, or further retransmission operations in a Member State; those latter operations fall under the autonomy of each Member State. Second, initial transmission operations do not comprise initial broadcasting over cable networks, 7.29 sometimes called cablecasting, as such acts are not retransmissions. Third, an initial transmission by cable must be intended for reception by the public; such reception 7.30 may eventually occur via broadcasting – thus over the air – or by wire to the public. The ‘intention’ criterion seems also to encompass initial transmission in encrypted form, namely insofar as the means for decrypting signals are provided to the public by the broadcasting organisation or with its consent, thus in line with Article 1(2)(c). Fourth, cable retransmission covered by this rule must be ‘simultaneous, unaltered and unabridged ’. 7.31 This falls in line with what was described under Article 1(2)(a) concerning uninterrupted satellite broadcasts. Delayed retransmissions are outside the scope of the Directive, but fall under the new RTV Directive 2019/789, and so are transmissions with a partly new (advertising) content, as they would not be considered ‘unaltered’. It is generally assumed in the doctrine that application of mere technical procedures, such as conversion from analogue to digital signals, would remain within the ambit of the definition.19 Article 1(3) of the Directive was somewhat amended in 2019 by Article 9 of the RTV Directive, making it clear that ‘initial transmission from another Member State’ may come about by wire (or over the air, including that by satellite), but ‘regardless of how the operator of a cable retransmission service obtains the programme-carrying signals from the broadcasting organization for the purpose of retransmission ’. As said in recital 21 to the RTV Directive, this amendment was to ensure that broadcasters, transmitting their programme-carrying signals directly to the public, thereby carrying out an initial act of transmission, would also be able to simultaneously transmit those signals to other organisations though the technical process of direct injection. This normally comes about nowadays primarily to ensure the quality of the signals for retransmission purposes. Nevertheless, the transmissions of those ‘other organisations’ constitute a separate act of communication to the public from the one carried out by the broadcasting organisation. In those situations, the amended text proclaims, the rules on retransmissions shall apply.

18 19

See T. Dreier, ‘Satellite and Cable Directive’, in M. Walter and S. von Lewinski (eds), European Copyright Law. A Commentary, Oxford University Press, 2010, pp. 400 et seq. Cf., T. Dreier and P.B. Hugenholtz, Concise European Copyright Law, Kluwer Law International, 2006, 273.

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8. Collecting society (art. 1(4)) 7.32 This paragraph is also of relevance mainly for Chapter III of the Directive, dealing with a system of mandatory collective management of cable retransmission rights, but also for Article 3(2) of Chapter II, which allows Member States to apply a system of so-called ‘extended collective licensing’ to satellite broadcasting, managed by collecting societies. 7.33 This paragraph offers a broad definition of a collecting society that encompasses ‘any organisation which manages or administers copyright or rights related to copyright as its sole purpose or as one of its main purposes’. Obviously, this ‘definition’ applies to virtually any kind of organisation, regardless of whether it operates under statutory rules, a legal monopoly or whether it is totally unregulated, hence including organisations also engaged in tasks other than collective rights management of their members, such as trade unions, but which have added such management to their repertoire.

NOTES 1. Related instruments Council Directive 552/89/EEC of 3 October 1989 on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the pursuit of television broadcasting activities, OJ L 298/23, 3.10.1989, as amended. Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 346/61, 19.11.1992, codified as Directive 2006/115. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.5.2001. Directive 98/84/EC of the European Parliament and of the Council of 20 November 1998 on the legal protection of services based on, or consisting of, conditional access, OJ L 320/54 20.11.1998. Directive (EU) 2019/789 of the European Parliament and of the Council of 17 April 2019 laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes, and amending Council Directive 93/83/EEC.

2. CJEU case law Airfield NV v Agicoa Belgium BVBA (C-432/09), ECLI:EU:C2011:648. Airfield NV and Canaal Digitaal BV v Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (Sabam) (C-431/09), ECLI:EU:C:2011:157. AKM, C-138/16, ECLI:EU:C:2017:218. Egeda v Hostelería (C-293/98), ECLI:EU:C:2000:66. Football Association Premiere League Ltd, NetMed Hellas SA, Multichoice Hellas SA v QC Leisure, David Richardson, AV Station plc, Malcolm Chamberlain, Michael Madden, SR Leisure Ltd, Philip George Charles Houghton, Derek Owen (C-403/08) and Karen Murphy v Media Protection Services Ltd joined cases C-429/08 and C-403/08 ECLI: EU:C:2011:43. ITV Broadcasting v TVCatchup C-607/11, ECLI:EU:C:2013:147. Lagardère Active Broadcast v Société pour la Perception del la rémunération équitable (SPRE) and Others (C-192/04), ECLI:EU:C:2005:475. Martin Luksan v Petrus van der Let (Case C-277/10), ECLI:EU:C:2012:65. Mediakabel (C-89/04), ECLI:EU:C:2005:348. Phonographic Performance, C-162/10, ECLI:EU:C:2012:141. Renckhoff, C-161/17, ECLI:EU:C:2018:634. SGAE (C-306/05) [2006] ECR I-11519. Union of European Football Associations (UEFA) and British Sky Broadcasting Ltd v Euroview Sport Ltd, C-228/10, Order of the President of the Court dated 11 January 2012, ECLI:EU:C:2012:6. Verwertungsgesellschaft Rundfunk, C-641/15, ECLI:EU:C:2017:131.

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ARTICLE 2: BROADCASTING RIGHT

3. Bibliography Dreier, T. and P.B. Hugenholtz, Concise European Copyright Law, Kluwer Law International, Alphen aan den Rijn, 2006. Dreier, T. ‘Satellite and Cable Directive’, in M. Walter and S. von Lewinski, European Copyright Law. A Commentary, Oxford University Press, Oxford, 2010.

CHAPTER II BROADCASTING OF PROGRAMMES BY SATELLITE ARTICLE 2: BROADCASTING RIGHT Member States shall provide an exclusive right for the author to authorise the communication to the public by satellite of copyright works, subject to the provisions set out in this chapter.

I. COMMENTARY 1. An exclusive broadcasting right in the country-of-origin (art. 2) This article functions as a necessary complement to the definition of communication to the public 7.34 by satellite in Article 1(1) and (2), construed as a strict country-of-origin rule, meaning that such communication by satellite occurs solely in a certain Member State. If authors had no exclusive right to communicate to the public by satellite in a Member State where the programme-carrying signals are introduced into an uninterrupted chain of communication etc, as defined by the Directive, such signals would not fall under the control of right holders anywhere within the EU as the provision in Article 1(2)(b) is a rule of substantive law. Eventually, the Information Society Directive 2001/29 provided for a more inclusive right of 7.35 communication, encompassing, inter alia, acts of satellite broadcasting. But at the time, it was a necessary element of the Directive that such a right was guaranteed to all authors, or the Directive could result in them losing all their rights in satellite broadcasts throughout Europe if broadcasting organisations were to send introductory satellite signals in Member States while not recognising that communication to the public via satellite broadcasts was an exclusive right of authors. For the purposes of this Directive Article 2 is focused on ‘the Author’, as already defined in Article 7.36 1(5), i.e., the principal director of an audiovisual work. Therefore, that definition is relevant only in connection with Article 2, whereas Member States must grant the exclusive rights of communication to the public by satellite of copyright works at least to the principal director. Formally, Article 2 only refers to Chapter II, but the ‘satellite and broadcasting right’ reasonably relates to definitions contained in Article 1(1) and (2). Member States retain their freedom to assess such a right also to persons other than the principal director so as to let them benefit from the exclusive right of satellite broadcasting. Further, it should be observed that the satellite broadcasting right is granted to performers, phonogram producers and broadcasting organisations by Article 4(1) and (2) in conjunction with Article 8(1), (2) and (3) of Directive 2006/115 codifying Council Directive 92/100/EEC on rental and lending rights.

NOTES 1. Related instruments Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.5.2001.

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ARTICLE 3: ACQUISITION OF BROADCASTING RIGHTS 1. 2.

3. 4.

Member States shall ensure that the authorisation referred to in Article 2 may be acquired only by [sic] agreement. A Member State may provide that a collective agreement between a collecting society and a broadcasting organisation concerning a given category of works may be extended to rightholders of the same category who are not represented by the collecting society, provided that: – the communication to the public by satellite simulcasts a terrestrial broadcast by the same broadcaster, and – the unrepresented rightholder shall, at any time, have the possibility of excluding the extension of the collective agreement to his works and of exercising his rights either individually or collectively. Paragraph 2 shall not apply to cinematographic works, including works created by a process analogous to cinematography. Where the law of a Member State provides for the extension of a collective agreement in accordance with the provisions of paragraph 2, that Member States shall inform the Commission which broadcasting organisations are entitled to avail themselves of that law. The Commission shall publish this information in the Official Journal of the European Communities (C series).

I. COMMENTARY 1. Acquisition by contract (art. 3(1)) 7.37 The exclusive nature of the satellite broadcasting right as a right of initial broadcasting is expressed in this paragraph, stressing that, as a rule, this right can only be acquired by contract. Apart from the exception pursuant to Article 3(2), a Member State is not free to make use of the possibilities of Article 11bis(2) of the Berne Convention and restrict the exclusive character of the satellite broadcasting right. Hence, the exclusive right, as set out in Article 2, may not be made subject to a system of statutory (or compulsory) licensing, even if the Berne Convention would allow for this. Again, the country-of-origin rule would eliminate all exclusivity of the satellite broadcasting right throughout the EU if a single Member State allowed for a statutory licence. 7.38 It is clear that Article 3(1) has been to a large extent superseded by Directive 2001/29 on the information society, as Article 5(3) of that Directive does not permit any exceptions or limitations to the right of communication to the public not listed in the just-mentioned paragraph. Still, Recital 16 of the Directive states that it is possible to continue limiting the exploitation of these rights, especially as far as certain technical means of transmission or certain language versions are concerned. 7.39 Although contractual freedom forms the basis for acquisition of exclusive satellite broadcasting rights, as explicitly said in Recital 16 of the Directive, Recital 17 very importantly states that in arriving at the amount of the payment to be made for the satellite broadcasting rights acquired, the focus of the parties involved should not be the territory of the country of transmission, whose law, by contrast, is solely concerned by the act of exploitation. What Recital 17 wants to foster is recognition by contracting parties of the total economic value of a satellite broadcast, such as the

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actual audience, the potential audience and the language version of the transmitted satellite broadcast. In this respect the country-of-origin approach of the Directive should not hinder contracting parties from evaluating the commercial effects of the transmission in all countries of reception. It should be stressed, though, that no article of the Directive deals with remuneration issues or economic effects of the chosen legal formula for satellite broadcasting.20

2. Collective licensing (art. 3(2)) Collective licensing is a completely different issue to statutory licensing and is a possibility on a 7.40 voluntary basis in each Member State where initial transmission of a satellite is concerned. Article 3(2) merely subjects the extension of collective agreements to outsiders to certain restrictive conditions, otherwise allowing Member States to provide for collective agreements, construed as agreements with an ‘extended’ effect to those not represented by a collecting society. Extended collective licensing, having effect for specific categories of protected works of unrepre- 7.41 sented right holders – so-called outsiders – already existed in the Nordic countries prior to the adoption of the Directive, but only in the case (of interest here) of simulcasting by satellite of terrestrial broadcasts. The Nordic States wanted to retain this extended effect also in respect of satellite broadcasting, although, at the time, only Denmark among the Nordic States was a Member State.21 As a compromise Article 3(2) was agreed upon. It allows for a Member State to provide collective 7.42 agreements with an extended effect to outsiders under two conditions: (i) the extended effect may only be valid for contracts between a collecting society and a broadcasting organisation which likewise transmits the satellite broadcast by terrestrial means; and (ii) the right holder not represented by the contracting collecting society must be able to opt out, i.e., to object to the extensional effect at any time. Hence, pure satellite broadcasts (no terrestrial transmittance) are not embraced by the exception and, to comply e.g., with the norms of the Berne Convention, the extended effect cannot be forced upon any right owner.

3. Cinematographic works (art. 3(3)) The exception contained in this paragraph recognises that right holders to cinematographic works 7.43 (and works created by a process analogous to cinematography, such as television films) want to make individual decisions about the conditions when, and at what point in time, a cinematographic work may be used for primary exploitation by way of transmission by satellite. Community-wide exploitation may then not come about via agreements merely in one Member State, but must be negotiated country by country as copyright law basically enjoins.

20

21

The Report of the Commission in 2002, COM (2002) 0430 final, 8 and 13, points out that the non-harmonisation of the distinction between cable retransmission systems, on the one hand, and collective reception activities on the other, might have a negative effect on the proper calculation of the remuneration for a trans-border satellite transmission of broadcast signals. Cf. J. Rosén, ‘The Nordic extended collective licensing model as a mechanism for simplified rights clearance for legitimate online services’, in J. Axhamn (ed.), Copyright in a Borderless Online Environment, Kluwers, Stockholm, 2012, 65 et seq; J. Rosén, ‘Copyright contracts – EU solutions or national concern? A Swedish proposal to amend the Copyright Act on individual and collective contracts’, in H.H. Lidgard (ed.), National Developments in the Intersection of IPR and Competition Law – From Maglite to Pirate Bay. Swedish Studies in European Law, vol 3, Hart Publishing, Oxford, 2008, 155 et seq.

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4. Duty to inform (art. 3(4)) 7.44 Where the law of a Member State provides for or admits the extension of a collective agreement in accordance with the provisions of Article 3(2), that Member State is obliged to notify the Commission which broadcasting organisations are allowed to make use of this possibility. This duty is not connected to factually concluded agreements or otherwise applicable extended collective licences.

NOTES 1. Related instruments Berne Convention for the Protection of Literary and Artistic Works last amended on 28 September 1979. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.5.2001.

2. Bibliography Rosén, J. ‘The Nordic extended collective licensing model as a mechanism for simplified rights clearance for legitimate online services’, in Axhamn, J. (ed.), Copyright in a Borderless Online Environment, Kluwers, Stockholm, 2012. Rosén, J. ‘Copyright contracts – EU solutions or national concern? A Swedish proposal to amend the Copyright Act on individual and collective contracts’, in Lidgard, H.H. (ed.), National Developments in the Intersection of IPR and Competition Law – From Maglite to Pirate Bay. Swedish Studies in European Law, vol 3, Hart Publishing, Oxford, 2008.

ARTICLE 4: RIGHTS OF PERFORMERS, PHONOGRAM PRODUCERS AND BROADCASTING ORGANISATIONS 1. 2. 3.

For the purposes of communication to the public by satellite, the rights of performers, phonogram producers and broadcasting organisations shall be protected in accordance with the provisions of Articles 6, 7, 8 and 10 of Directive 92/100/EEC. For the purposes of paragraph 1, “broadcasting by wireless means” in Directive 92/100/ EEC shall be understood as including communication to the public by satellite. With regard to the exercise of the rights referred to in paragraph 1, Articles 2(7) and 12 of Directive 92/100/EEC shall apply.

I. COMMENTARY 1. Related rights (art. 4(1)) 7.45 According to this paragraph the country-of-origin principle laid down in Articles 1(2), 2 and 3 should also be of relevance to related rights of performing artists, phonogram producers and broadcasting organisations, and thus to let them benefit from a certain minimum protection in respect of the transmission of their performances by satellite in all Member States. This Directive does so by a mere reference to the rights already guaranteed in Directive 92/100, now Directive 2006/115 on rental and lending rights. 7.46 Obviously, this reference is not necessary, but merely of a declarative nature, probably inserted in the Directive due to its editorial history and the timing of Directive 2006/115 being adopted. Hence, the Directive did not expand the somewhat meagre related rights emanating from the early 1990’s Directive, eventually codified as Directive 2006/115, but in implementing the WIPO

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ARTICLE 4: RIGHTS OF PERFORMERS, PHONOGRAM PRODUCERS AND BROADCASTING

performances and Phonograms Treaty, WPPT, and Articles 2 and 3(2) of Directive 2001/29 on the information society, such expansion has come about to a considerable extent via the right of communication to the public and the right of making available to the public. As stated in Article 6 of the Directive all rights there described define a minimum protection, whereas Member States may keep or introduce more embracing related rights. Further, those limitations and exceptions provided for in Article 10 of Directive 2006/115 on rental 7.47 and lending rights apply to broadcasts of protected subject matter related to copyright, as set out in Article 4(1) of the Directive. Hence, compulsory licences are admitted to the extent they are allowed by Article 15(2) of the Rome Convention.

2. Wireless broadcasting (art. 4(2)) This paragraph connects to Article 8(1) of Directive 2006/115 on rental and lending rights, by 7.48 stating that communication by satellite is included in the right to authorise ‘broadcasting by wireless means’ as described in that Directive. Probably, a satellite broadcast, as defined in Article 1(2) of the Directive, should logically be included also in the terms ‘broadcast’, ‘broadcasting by wireless means’ and ‘broadcast performance’ as used in Articles 6, 7, 8 and 10 in Directive 2006/115 on rental and lending rights.22

3. Presumption of transfer (art. 4(3)) This paragraph is built on a reference to Article 2(7) of Directive 2006/115, which reads:

7.49

Member States may provide that the signing of a contract concluded between a performer and a film producer concerning the production of a film has the effect of authorising rental, provided that such contract provides for an equitable remuneration within the meaning of Article 4. Member States may also provide that this paragraph shall apply mutatis mutandis to the rights included in Chapter II.

This reference has caused much confusion as Article 2(7) of Directive 2006/115 allows for a presumed transfer of rental rights and does not refer to the act of broadcasting in any way.23 A general assumption would be that Member States may provide for a similar rule in respect of rights of a satellite broadcast. Further, there are confusing discrepancies between recitals and the actual text of the Directive, 7.50 connected to the same issue, as demonstrated by Recital 26 of the Directive.24 It states that there should also be a possibility for Member States to extend the presumption of Article 2(5) of Directive 2006/115 to the satellite broadcasting right. A performer covered by a relevant contract shall be presumed to have transferred his right to the film producer. As the text of the Directive says nothing about this the recital probably reflects some compromise during the process of working out the Directive.

22 23 24

Cf. M. Walter and S. von Lewinski (eds), European Copyright Law. A Commentary, Oxford University Press, 2010, 434 et seq. Cf. T. Dreier and P.B. Hugenholtz, Concise European Copyright Law, Kluwer Law International, 2006, 276; Walter and von Lewinski, 435 et seq. Recital 26 reads: Whereas the provisions of Article 4 do not prevent Member States from extending the presumption set out in Article 2 (5) of Directive 92/100/EEC to the exclusive rights referred to in Article 4; whereas, furthermore, the provisions of Article 4 do not prevent Member States from providing for a rebuttable presumption of the authorization of exploitation in respect of the exclusive rights of performers referred to in that Article, in so far as such presumption is compatible with the International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations.

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NOTES 1. Related instruments Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations of 26 October 1961. Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376/28, 12.12.2006. WIPO Performances and Phonograms Treaty of December 20, 1996 (WPPT).

2. Bibliography Dreier, T. and P.B. Hugenholtz, Concise European Copyright Law, Kluwer Law International, Alphen aan den Rijn, 2006. Dreier, T. ‘Satellite and Cable Directive’, in. Walter, M. and S. von Lewinski (eds), European Copyright Law: A Commentary, Oxford University Press, Oxford, 2010. Walter, M. and S. von Lewinski (eds), European Copyright Law. A Commentary, Oxford University Press, Oxford, 2010.

ARTICLE 5: RELATION BETWEEN COPYRIGHT AND RELATED RIGHTS Protection of copyright-related rights under this Directive shall leave intact and shall in no way affect the protection of copyright.

I. COMMENTARY 7.51 This provision appears rather programmatic in its declaration that the exclusive copyrights should not be prejudiced by related rights – but probably nothing more than that; it is not a provision of substantive law, even if it in reality refers to Article 1(1) of the Rome Convention, adopted by Article 1(2) of the WIPO Performers and Phonograms Treaty, WPPT.

NOTES 1. Related instruments Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations of 26 October 1961. WIPO Performances and Phonograms Treaty of December 20 1996. See also notes at Article 1.

ARTICLE 6: MINIMUM PROTECTION 1. 2.

Member States may provide for more far-reaching protection for holders of rights related to copyright than that required by Article 8 of Directive 92/100/EEC. In applying paragraph 1 Member States shall observe the definitions contained in Article 1(1) and (2).

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ARTICLE 7: TRANSITIONAL PROVISIONS

I. COMMENTARY 1. Minimum harmonisation (art. 6(1)) This provision states that Member States may retain or introduce a protection which goes beyond 7.52 the one provided for in Article 4 of the Directive. Hence, Article 6(1) clarifies, building on Recital 34,25 that what is thus achieved is not a maximum protection. The possibility of expanding rights has, in practice, a major relevance for what may go beyond Article 4, i.e., additional exclusive rights for holders of related rights, and also persons not at all referred to in Article 4, e.g., producers of film and simple photography. But Member States are certainly not obliged to grant more rights, or to provide for such rights to be acquired by way of contract, than follows from Articles 3 and 4.

2. Focus on up-link country (art. 6(2)) It should be well observed that Member States, in granting such extra protection provided for by 7.53 Article 6(1), shall not deviate from the basic country of transmission rule for satellite broadcasting (Art. 1(2)), applied by direct satellites as well as communications satellites (Art. 1(1)). This actually facilitates the possibility of differences between levels of protection in different Member States, i.e., non-harmonisation, as a higher level of protection in one Member State, be it through stronger exclusive rights or only through a claim of remuneration, may not necessarily be recognised in another Member State being the country of transmission. As follows from Recital 17 – ‘in arriving at the amount of the payment to be made for the rights 7.54 acquired, the parties should take account of all aspects of the broadcast, such as the actual audience, the potential audience and the language version’ – contracting parties are urged to recognise the full impact of the footprint of the broadcast, thus to calculate remuneration to be shared with those right holders in countries of reception.26

NOTES See notes at Article 1.

ARTICLE 7: TRANSITIONAL PROVISIONS 1. 2.

25

With regard to the application in time of the rights referred to in Article 4(1) of this Directive, Article 13(1), (2), (6) and (7) of Directive 92/100/EEC shall apply. Article 13(4) and (5) of Directive 92/100/EEC shall apply mutatis mutandis. Agreements concerning the exploitation of works and other protected subject matter which are in force on the date mentioned in Article 14(1) shall be subject to the provisions of Articles 1(2), 2 and 3 as from 1 January 2000 if they expire after that date.

Recital 34 reads: Whereas this Directive should not prejudice further harmonisation in the field of copyright and rights related to copyright and the collective administration of such rights; whereas the possibility for Member States to regulate the activities of collecting societies should not prejudice the freedom of contractual negotiation of the rights provided for in this Directive, on the understanding that such negotiation takes place within the framework of general or specific national rules with regard to competition law or the prevention of abuse of monopolies.

26

See commentary to Art. 3(1) supra.

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3.

When an international co-production agreement concluded before the date mentioned in Article 14(1) between a co-producer from a Member State and one or more co-producers from other Member States or third countries expressly provides for a system of division of exploitation rights between the co-producers by geographical areas for all means of communication to the public, without distinguishing the arrangement applicable to communication to the public by satellite from the provisions applicable to the other means of communication, and where communication to the public by satellite of the co-production would prejudice the exclusivity, in particular the language exclusivity, of one of the co-producers or his assignees in a given territory, the authorisation by one of the co-producers or his assignees for a communication to the public by satellite shall require the prior consent of the holder of that exclusivity, whether co-producer or assignee.

I. COMMENTARY 1. Application in time (art. 7(1)) 7.55 References in this paragraph are made to a number of articles in Directive 2006/115 (formerly 92/100EC). This merely follows from the fact that Directive 93/83 had already been negotiated in the Parliament before the former Directive, which made it unclear to what extent the protection of other subject matter would have to be regulated in the latter Directive. Ultimately, the impact of these references is not a strong one, as the Directive did not raise the standard of related rights protection as set by Directive 2006/115. However, the decisive date was 1 July 1994, whereas the obligation to protect subject matters embraced by Article 4(1) only exists with regard to subject matter with existing protection on this day or which fulfilled criteria set out by Directive 2006/115 at this point of time. 7.56 As for the reference to Article 13(4) of Directive 2006/115, it means that Member States are not obliged to consider the principal director of a cinematographic work as its author or co-author, if the film was created before 1 July 1994. 7.57 Since the Directive has not granted any new rights in respect of satellite broadcasts, going beyond what Directive 2006/115 has assessed, the reference to Article 13(7) of that Directive does not force Member States to deviate from the impact of that paragraph as far as satellite broadcasts are concerned.

2. Transitional provisions for old contracts (art. 7(2)) 7.58 Article 7(2) recognises broadcasting licences that were effective before 1 January 1995, the implementation day of the Directive, and postpones the Directive’s country-of-origin rule for such contracts until 1 January 2000. It may be assumed, due to the broad language of the provision – agreements ‘concerning the exploitation of works and other protected subject matter’ – that it encompasses all exploitation agreements, not merely those directed specifically to broadcasting. It follows from Article 7(2) that national rules, e.g., stating that satellite broadcasts fall under the legislation of each Member State where reception of the broadcast occurs, had an effect no longer than until the year 2000 on agreements concluded before 1 January 1995. 7.59 In practice, this provision had a bearing on all those film exploitation agreements valid at the time of the implementation day, but which were to expire or to be renegotiated during the next few years. The new regime could then be applied, or could at least be recognised, when old agreements were renewed or renegotiated.

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ARTICLE 7: TRANSITIONAL PROVISIONS

3. Transitional provisions for co-production agreements (art. 7(3)) This provision is focused on, and strictly limited to, international co-production agreements 7.60 between a co-producer from one Member State and one or more co-producers from other Member States or third countries.27 It recognises that international co-production agreements have regularly provided for a division of exploitation rights along national borders and a split in respect of different language versions. The rationale of the provision is to preserve exclusivity of such territorially limited rights built on 7.61 agreements concluded before 1 January 1995. This falls in line with Article 7(2), but Article 7(3) has an effect also after 1 January 2000, i.e. the requirement of authorisation by one of the co-producers or his assignee for a communication to the public by satellite, whose exclusive rights are prejudiced if the country-of-origin principle is applied. Further conditions for this to apply are the following: The co-production agreement must expressly provide for a division of exploitation rights between the co-producers by geographical areas, and this division must apply to all means of communication to the public, thereby not distinguishing satellite communication from other forms of communication. The most prominent condition, already indicated, is that the communication to the public by satellite must not prejudice the exclusive rights of a co-producer. If all conditions are met a transmission by satellite would require the prior consent of the holder of the concerned exclusive rights, based on contracts concluded before 1 January 1995, in the country of reception. The remedy for a contracting party’s deviation from these norms would merely be damages for breach of contract. Article 7(3) or other provisions of the Directive are not really doing away with territorial licensing, 7.62 although they cut off territorial copyrights related to countries of reception. In particular the film industry has continued its practice of splitting up markets territorially for all sorts of communication to the public.28

NOTES 1. Related instruments Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 346/61, 19.11.1992, codified as Directive 2006/115. Directive 98/84/EC of the European Parliament and of the Council of 20 November 1998 on the legal protection of services based on, or consisting of, conditional access OJ L 320/54 20.11.1998. Report from the European Commission on the application of the Council Directive 93/83/EEC on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission of 26 July 2002, COM (2002) 0430 final. See also notes at Art. 1.

27

28

The German Supreme Court, the Federal Court of Justice, has applied this provision also to a purely national co-production agreement; decision of 13 October 2004, case I ZR 49/03, Man spricht deutsch (2005) GRUR 48. In view of the exact phrasing of the provision this application seems unjustified, which also follows from the provision’s nature of being an exception to the general rule. Cf. the Report from the European Commission on the application of the Council Dir. 93/83/EEC on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission of 26 July 2002, COM (2002) 0430 final. See also Art. 14 (note 2) of the Directive.

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CHAPTER III CABLE RETRANSMISSION ARTICLE 8: CABLE RETRANSMISSION RIGHT 1.

2.

Member States shall ensure that when programmes from other Member States are retransmitted by cable in their territory the applicable copyright and related rights are observed and that such retransmission takes place on the basis of individual or collective contractual agreements between copyright owners, holders of related rights and cable operators. Notwithstanding paragraph 1, Member States may retain until 31 December 1997 such statutory licence systems which are in operation or expressly provided for by national law on 31 July 1991.

I. COMMENTARY 1. Acquisition of cable retransmission rights (art. 8(1)) 7.63 Cable retransmission has already been defined in Article 1(3) of the Directive and has been commented on above (see paras 7.27–7.33). It follows from that provision that Article 8(1) only applies to cable retransmission of programmes originating in another Member State. Purely national retransmissions are thus not encompassed by Article 8(1) at all and Member States may continue to apply e.g., statutory licences for such national situations, whereas this article as a general rule states that cable retransmission shall be authorised on a contractual basis.29 The rationale of the paragraph is to depart from those statutory or compulsory licences which at the time were still common in a number of Member States and were then favoured by the Commission. 7.64 To a certain extent such contractual authorisation must occur via collecting societies, as explicitly follows from Article 9 of the Directive. However, this paragraph also mentions individual contracts. The latter formula is accepted because broadcasting organisations are excluded from the obligation of having their rights exercised by a collecting society according to Article 10 of the Directive. 7.65 It should be noted that Article 8(1) does not establish an exclusive right of cable retransmission, as it merely imposes an obligation on Member States to ensure that ‘the applicable copyright and related rights are observed’ when programmes from other Member States are retransmitted by cable. However, it recognises implicitly that cable retransmission is a restricted act under the copyright laws of each Member State, as said in Recital 27: ‘the cable retransmission of programmes from other Member States is an act subject to copyright and … rights related to copyright’, which obliges the cable operator to ‘obtain the authorization from every holder of rights in each part of the programme retransmitted’.30 7.66 A further reservation must be made as related rights are concerned, in spite of the express language of Article 8(1). Quite commonly, national laws did not render neighbouring rights the dimension of encompassing cable retransmission as a restricted act, and neither the Directive nor Directive 2006/115 (92/100) nor the Rome Convention does that. Later on Article 3(1) of Directive 2001/29 caused harmonisation of the cable retransmission right as something emanating from the overarching communication to the public right.

29 30

Cf. Recital 27 of the Directive: ‘pursuant to this Directive, the authorisations should be granted contractually unless a temporary exception is provided for in the case of existing legal licence schemes’. Cf. Case C-293/98, ECLI:EU:C:2000:66, Egeda v Hostelería, recital 24.

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ARTICLE 9: EXERCISE OF THE CABLE RETRANSMISSION RIGHT

2. Transitional provisions (art. 8(2)) According to Article 8(2) Member States had to abolish existing statutory licences, or compulsory 7.67 licences, no later than 31 December 1997. However, that transitional provision only applied to statutory licensing systems already in operation prior to 31 July 1991, the day before the Directive was first proposed. This timing reflects the ambition to stop the introduction of new statutory licences in Member States in the short term.

NOTES 1. Related instruments Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations of 26 October 1961. Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 346/61, 19.11.1992, codified as Directive 2006/115. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.5.2001.

2. CJEU case law Egeda v Hostelería (C-293/98) ECLI:EU:C:2000:66.

ARTICLE 9: EXERCISE OF THE CABLE RETRANSMISSION RIGHT 1. 2.

3.

Member States shall ensure that the right of copyright owners and holders or related rights to grant or refuse authorisation to a cable operator for a cable retransmission may be exercised only through a collecting society. Where a rightholder has not transferred the management of his rights to a collecting society, the collecting society which manages rights of the same category shall be deemed to be mandated to manage his rights. Where more than one collecting society manages rights of that category, the rightholder shall be free to choose which of those collecting societies is deemed to be mandated to manage his rights. A rightholder referred to in this paragraph shall have the same rights and obligations resulting from the agreement between the cable operator and the collecting society which is deemed to be mandated to manage his rights as the rightholders who have mandated that collecting society and he shall be able to claim those rights within a period, to be fixed by the Member State concerned, which shall not be shorter than three years from the date of the cable retransmission which includes his work or other protected subject matter. A Member State may provide that, when a rightholder authorizes the initial transmission within its territory of a work or other protected subject matter, he shall be deemed to have agreed not to exercise his cable retransmission rights on an individual basis but to exercise them in accordance with the provisions of this Directive.

I. COMMENTARY 1. Mandatory collective rights management (art. 9(1)) Cable retransmission rights may not be exercised by right holders individually, with the exception 7.68 provided for in Article 10 of the Directive (see paras 7.74–7.75 below), but only through collecting

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societies. The prominent aim of this provision, essential to the Directive’s normative force on cable retransmission, is to hinder such right holders, controlling parts of a broadcast programme, who are not represented by a collecting society, refusing authorisation of their individual rights in retransmitted programmes to cable operators. As this provision refers to ‘the right to grant or refuse authorisation’ it does not cover rights merely to remuneration, of relevance prominently for certain groupings of related rights, hence leaving out such rights from the mandatory collective exercise. 7.69 It is to be noted that the exclusive rights remain intact in spite of the mandatory element of Article 9(1), but their exercise is regulated in the said respect. Still, the mandatory collective exercise of rights draws close to a compulsory licence regime from the right holder’s perspective. Obviously, e.g., film producers are not able to control cable retransmission in a foreign market, in spite of their long-time practice of splitting up markets in different parts of Europe, provided of course that such producers have licensed the film in question for television broadcasting. 7.70 Another important consequence of Article 9(1) must be observed – it leaves the right to cable retransmission unhampered in the sense that it is still transferable. In the light of Article 10, which allows broadcasters to exercise retransmission of rights on an individual basis, a right holder may transfer his rights to the broadcasting organisation initially transmitting the subject matter, thereby potentially avoiding such rights being administered according to Article 8(1) by a collecting society when the broadcast is retransmitted via cable.31

2. Treatment of outsiders (art. 9(2)) 7.71 A right holder who has neither transferred his rights to a broadcaster nor to a collecting society shall, according to Article 9(2) of the Directive, enjoy equal treatment to right owners represented by a collecting society. This provision mandates a collecting society, which manages the rights of the same category in the Member State concerned, to manage the rights of the outsiders. An unrepresented right holder is thus entitled to the same remuneration, share of revenues, etc. as those factually represented right holders, as the collecting society is obliged to treat outsiders and members on an equal footing. Moreover, outsiders are granted the right to be informed and to have an account just as much as ‘insiders’ may have according to national law. 7.72 It may be that more than one collecting society is managing rights of the same category within a certain territory – the outsider may then select one of those to be represented by or, rather, to be mandated to manage his rights. In practice, revenues received from cable operators will be at stake and the outsider may then mandate the collecting society (if more than one) by which he expects to get the highest revenue. However, a collecting society may limit the period within which right owners must make a claim for remuneration, as Member States are free to regulate this by setting limits to such a period, but for a minimum of ‘three years from the date of the cable retransmission’ which includes works or other protected subject matter.

3. Statutory presumptions (art. 9(3)) 7.73 This provision is a complex result of discussions during the evolution of the Directive and reflects that some Member States feared that Article 9(1) would cause a right holder to be forced, according to national constitutional law, to exercise his rights collectively through a collecting society, hence infringing constitutionally guaranteed rights of ownership. Accordingly, Article 9(3) enables a Member State to frame the mandatory exercise of cable retransmission rights by collecting societies

31

The CJEU has found that such an assignment may be made both on the basis of a contract and by virtue of a legal presumption applicable by a Member State’s law on copyright; Case C-169/05, ECLI:EU:C:2006:365, Uradex.

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ARTICLE 10: EXERCISE OF THE CABLE RETRANSMISSION RIGHT BY BROADCASTING ORGANISATIONS

by a statutory presumption. Such a legal presumption is attached to the contractual authorisation of the initial transmission.

NOTES 1. CJEU case law Uradex SCRL v Union Professionnelle de la Radio et de la Teledistribution (RTD) C-169/0, ECLI:EU:C:2006:365.

ARTICLE 10: EXERCISE OF THE CABLE RETRANSMISSION RIGHT BY BROADCASTING ORGANISATIONS Member States shall ensure that Article 9 does not apply to the rights exercised by a broadcasting organisation in respect of its own transmission, irrespective of whether the rights concerned are its own or have been transferred to it by other copyright owners and/or holders of related rights.

I. COMMENTARY 1. Broadcasters’ exception (art. 10) As already mentioned in previous commentaries, Article 10 provides broadcasting organisations 7.74 with a mandatory exemption from the obligation, set forth by the fundamental principle of Article 9(1) of the Directive, to exercise their rights collectively. Accordingly, they may exercise their rights by cable retransmission, irrelevant if the transmission concerns their own rights in their broadcast content or rights ‘transferred’ – licences and employers’ rights by law included – to the broadcasting organisation for their productions and broadcasts. This exception for broadcasters is logical in view of the major goal of Article 9(1), namely to simplify acquisition of rights by cable operators – the immense number of individual right holders with regard to contents of retransmitted broadcasts make them unmanageable by cable retransmission, whereas broadcasters are relatively few and well known to cable operators. Unfortunately, this exception for broadcasters also carries a built-in problem, as it may very well 7.75 cause different treatment of a certain part of programme contents transmitted by cable, also with regard to the same category of works or protected material. This comes about as some individual rights may be exercised by a collecting society whereas other parts are controlled by a broadcasting organisation. In practice, a collecting society cannot separate their members’ rights from those of such outsiders; moreover Article 9(2) forces them also to exercise rights of outsiders and to offer outsiders remuneration on an equal footing with members. Some of the unwanted effects of this were observed in Recital 29 of the Directive, saying that, ‘the exemption provided for in Article 10 should not limit the choice of holders of rights to transfer their rights to a collecting society and thereby have a direct share in the remuneration paid by the cable distributor for cable retransmission’. However, such a statement does not solve the problem. The Commission report of 2002 exposes different scenarios for more pressure on the broadcasters to pass on, i.e., to authors and other right owners, remunerations collected from cable retransmission.32

32

See Report of the Commission, COM (2002) 0430 final, at 12.

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NOTES 1. Related instruments Report from the European Commission on the application of Council Directive 93/83/EEC on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission COM/2002/0430 final. See also notes at Art. 1.

ARTICLE 11: MEDIATORS 1. 2. 3.

4.

Where no agreement is concluded regarding authorisation of the cable retransmission of a broadcast, Member States shall ensure that either party may call upon the assistance of one or more mediators. The task of the mediators shall be to provide assistance with negotiation. They may also submit proposals to the parties. It shall be assumed that all the parties accept a proposal as referred to in paragraph 2 if none of them expresses its opposition within a period of three months. Notice of the proposal and of any opposition thereto shall be served on the parties concerned in accordance with the applicable rules concerning the service of legal documents. The mediators shall be so selected that their independence and impartiality are beyond reasonable doubt.

I. COMMENTARY 1. Set up of a mediation system (art. 11(1)) 7.76 This paragraph provides for a mediation system for the Member States to set up as a facility to dissolve prolonged stalemates, i.e. where no agreement is concluded regarding authorisation of cable retransmission of a broadcast. It does so by providing for a mediation procedure in Article 11 and, in Article 12, a control mechanism to avoid potential abuses of negotiation positions. As Article 11(1) is phrased – not because of the obviously missing words of the text – Member States are probably not obliged to set up such a system in advance of a potential conflict and the construction of the mediations facility, if at all realised, may come about in many different settings. Further, mediation may be initiated by either party, but it remains voluntary to its nature, whereas stalemates may occur if no party seeks recourse to mediation. 7.77 Against this background it remains almost fully open to a Member State to continue with a mediation facility to settle disputes of the nature at stake here, which it may already have provided for. In some Member States various systems of mediation in the context of collective rights management already existed prior to the Directive, such as in Germany and the Nordic countries. We may also observe here that the new DSM Directive introduces a negotiation mechanism for video-on-demand platforms.33 It has no impact on the field of application of the Directive, as the DSM Directive merely concerns video-on-demand, alas different forms of online uses, but demonstrates the will of the EU legislator, just as by Article 11 of the Directive, to boost availability of audiovisual works in 33

Cf. in particular Art. 13 of the Directive (EU) 2019/790 of the Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC. Directive introduces a negotiation mechanism in a Member State to promote access and availability of audiovisual works on video-on-demand platforms.

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ARTICLE 11: MEDIATORS

transborder traffic as well as fair contractual terms for those uses, but limited to audiovisual works on video-on-demand platforms. The same may be said about the new NetCab Directive, as it in Article 6 introduces an obligation for Member States to ensure a possible call for the assistance of one or more ‘mediators’, just as provided for in Article 11 of the Directive.34 The focus of Article 6 of the NetCab Directive is thus to let mediators push for a contractual solution when no agreement is concluded between the collective management organisation and the operator of a retransmission service, or between the operator of a retransmission service and the broadcasting organisation regarding authorisation for retransmission of a broadcast, all in the online environment.

2. Mediation procedure (art. 11(2) and (3)) As already said, the procedure remains a mere facility at the disposal of conflicting parties, it cannot 7.78 be imposed on parties refusing any attempt at mediation. Accordingly, the mandate of the mediators shall be to provide ‘assistance with negotiation’ and to ‘submit proposals to the parties’. The only binding effect of a mediator’s proposal is provided for in Article 11(3), adding to the transparency of the negotiations by imposing on the negotiating parties the requirement to express their opposition to a proposal, actually submitted to them by the mediator, within a period of three months, or it will be binding on them. But if this mediation service is not asked for, prolonged stalemates may continue in the individual case without any real means for putting the parties under pressure to enter an agreement.35

3. Independence and impartiality of mediators (art. 11(4)) It may seem superfluous to observe that mediators must be independent and impartial – as a matter 7.79 of principle this would be taken for granted due to the very nature of a mediator’s task. Probably, this provision reflects the fact that Article 11(4) does not specify in what way mediators may be selected, although Member States are in fact free to determine that. Further, due to the phrasing of this provision, each individual mediator, where two or more are employed in a specific case, must probably be independent and impartial, and not merely the mediator board as a whole. If this is a correct interpretation of Article 11(4), normal procedures for appointing members of a mediators’ board cannot be employed, e.g., by which each conflicting party may select its own mediator.

NOTES 1. Related instruments Report from the European Commission on the application of Council Directive 93/83/EEC on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission COM/2002/0430 final. Directive (EU) 2019/790 of the Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC. Directive (EU) 2019/789 of the European Parliament and of the Council of 17 April 2019 laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes, and amending Council Directive 93/83/EEC. See also notes at Art. 1.

34

35

See Directive (EU) 2019/789 of the European Parliament and of the Council of 17 April 2019 laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes, and amending Council Directive 93/83/EEC. Mediation systems actually set up in Member States have been put to little use in practice; the mediation facility e.g., in Sweden, in place for more than 30 years, has been engaged only two times during its period of existence. This generally very meagre result of the mediation instrument was observed also in the Report of the Commission, COM (2002) 0430 final, at 6 and 9 ff.

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Chapter 7 THE SATELLITE AND CABLE DIRECTIVE

ARTICLE 12: PREVENTION OF THE ABUSE OF NEGOTIATING POSITIONS 1. 2.

3.

Member States shall ensure by means of civil or administrative law, as appropriate, that the parties enter and conduct negotiations regarding authorisation for cable retransmission in good faith and do not prevent or hinder negotiation without valid justification. A Member State which, on the date mentioned in Article 14(1), has a body with jurisdiction in its territory over cases where the right to retransmit a programme by cable to the public in that Member State has been unreasonably refused or offered on unreasonable terms by a broadcasting organisation may retain that body. Paragraph 2 shall apply for a transitional period of eight years from the date mentioned in Article 14(1).

I. COMMENTARY 1. Obligation to negotiate – but not to grant a licence (art. 12(1)) 7.80 The basic ideas of this provision are expressed in Recital 30 of the Directive, which states that it is necessary to ensure negotiations are not blocked without valid justification and that individual right holders must not be prevented without valid justification from taking part in the negotiations. However, Recital 30 also stresses that, ‘none of these measures for the promotion of the acquisition of rights calls into question the contractual nature of the acquisition of cable retransmission rights’. Thus, the core of this provision is the prevention of abusive behaviour of a contracting party. 7.81 How Member States should accomplish this is very much left to their discretion. It is clear, however, that provisions of national competition law will as such not suffice to implement Article 12(1), as competition law, generally speaking, is narrower in its scope than this article. On the other hand Member States may provide remedies against abusive behaviour, typically arbitrary refusal of retransmission by cable, in civil as well as administrative law. Still, it remains fairly open, or unclear, how that should be accomplished. 7.82 Notwithstanding the distinct phrasing of Article 12(1) – ‘the Member States shall ensure’ – they are presumably not forced to build up legal remedies against the consequences of an abusive behaviour following from this paragraph, as there is not really an obligation to contract in the first place, as said in Recital 30 to the Directive – but for the special norms of Article 13 – in particular if conditions proposed by a cable operator seem unsatisfactory to the right owners. Hence, there is no pressure on Member States to provide for a conclusion of a contract against either party’s will.

2. Transitional provisions (art. 12(2) and (3)) 7.83 Basically, Article 12(2) and (3) are both directed towards any coercive contractual authorisation. If there is a ‘body with jurisdiction in its territory over cases’ concerning the right to retransmit a programme by cable, a Member State may only retain such a body for a transitional period, thus to be abolished no later than 1 January 2003. But the Directive says nothing about the competence of such a body during the transitional period; however, this is now a matter that has been surpassed by time.36 By contrast, Article 13 of the Directive remains as a general obligation to contract for collecting societies.

36

Cf. the Commission’s Report COM (2002) 0430 final, 6.

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ARTICLE 13: COLLECTIVE ADMINISTRATION OF RIGHTS

NOTES 1. Related instruments Report from the European Commission on the application of Council Directive 93/83/EEC on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission COM/2002/0430 final. See also notes at Art. 1.

CHAPTER IV GENERAL PROVISIONS ARTICLE 13: COLLECTIVE ADMINISTRATION OF RIGHTS This Directive shall be without prejudice to the regulation of the activities of collecting societies by the Member States.

I. COMMENTARY 1. National rules unaffected (art. 13) Article 13 must be seen as a compromise between conflicting attitudes of Member States towards 7.84 the principle of freedom of contract, on the one hand, and the possibility of enforcing a missing consent to ensure cable retransmission, on the other. Article 13 leaves the basic approach in Article 8(1) unhampered, ‘individual or collective contractual agreements’ are the formula for copyright and related rights when retransmission by cable is in question. But it is left to the Member States to subject the authorisation at least of the collecting societies to a general obligation to contract, as is actually found in some Member States, such as Germany.37 The construction of Article 13 is loosened somewhat against the background of Recital 34, which 7.85 says that the possibility for Member States to regulate the activities of collecting societies should not prejudice the freedom of contractual negotiation of the rights provided for in this Directive, on the understanding that such negotiation takes place within the framework of general or specific national rules with regard to competition law or the prevention of abuse of monopolies. Accordingly, such regulation must be general to its nature or generally applicable to collecting societies, not merely with an impact on cable retransmission.

NOTES See notes at Art. 1.

37

See §§ 11 and 12 of the German Copyright Administration Act, Urheberrechtswahrnehmungsgesetz, UrhWG.

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Chapter 7 THE SATELLITE AND CABLE DIRECTIVE

ARTICLE 14: FINAL PROVISIONS 1.

2. 3.

Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before 1 January 1995. They shall immediately inform the Commission thereof. When Member States adopt these measures, the latter shall contain a reference to this Directive or shall be accompanied by such reference at the time of their official publication. The methods of making such a reference shall be laid down by the Member States. Member States shall communicate to the Commission the provisions of national law which they adopt in the field covered by this Directive. Not later than 1 January 2000, the Commission shall submit to the European Parliament, the Council and the Economic and Social Committee a report on the application of this Directive and, if necessary, make further proposals to adapt it to developments in the audio and audiovisual sector.

I. COMMENTARY 1. Implementation deadline and duty of notification (art. 14(1) and (2)) 7.86 The implementation deadline according to Article 14(1) is long since passed and the Commission has in its Report of 26 July 2002, under its obligation under Article 14(3), noted that Member States have by and large accomplished the implementation of the Directive correctly, although not in time in some Member States. Further, the duty of Member States to notify the Commission according to Article 14(2) obviously helped the Commission to evaluate and monitor the current situation, although by now this was almost two decades ago.

2. Report of the Commission (art. 14(3)) 7.87 Although basically positive to the implementation process in Member States and to the Directive’s way of conceptualising mechanisms for cross-border broadcasting of television, the Commission’s Report also states that the Directive has not had the effects hoped for in a number of areas. Perhaps most prominently the Report is critical of prevailing difficulties in many Member States in acquiring cable retransmission rights, and noted that this by and large is due to the manifold of negotiating parties potentially involved, thus leading to territorial market fragmentation.38 This is certainly what still dominates the market for television broadcasts via satellite and cable retransmission. However, it should be stressed that market separation has less to do with national copyright law and the flaws of the Directive’s norms, but emanates from right holders’ preferences when it comes to licensing and collection of remuneration as well modern technologies of encryption and distribution via optical fibres, webcasting and other alternatives of modern media to communication by satellite. 7.88 The most important factor for the fading success of the Directive emanates from the very construction of the country-of-origin principle, as follows from Article 1(2)(a) of the Directive. The application of it is totally built on the notion of an uninterrupted and closed communication system of which the satellite forms the central, essential and irreplaceable element. Contemporary methods applied for cross-border broadcasting rarely employ a satellite in that manner, but would rather use a multitude of different methods, parallel to the communication via satellite of one and the same broadcast, hence certainly not using the satellite as an irreplaceable element of the communication.

38

Cf. the Commission’s Report COM (2002) 0430 final, 12 et seq.

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ARTICLE 15

Modern media has thus led to a situation in which the Directive is often not applicable for a satellite broadcast, notwithstanding the existence of a satellite as part of a communication in the individual case. The need for the new NetCab Directive 2019/789 on online transmission and retransmission of radio and television obviously emanated from that technological shift, which accordingly paved the way for it, although it is clear that the norms and factual solutions of the NetCab Directive are basically built on those of the Directive.

NOTES 1. Related instruments Report from the European Commission on the application of Council Directive 93/83/EEC on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission COM/2002/0430 final. Directive (EU) 2019/789 of the European Parliament and of the Council of 17 April 2019 laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes, and amending Council Directive 93/83/EEC. See also notes at Art. 1.

ARTICLE 15 This Directive is addressed to the Member States

I. COMMENTARY 1. No direct effect (art. 15) It follows from Article 249 of the EC Treaty that the Directive, as an instrument of legislation, is 7.89 addressed to the Member States and that it is binding upon them as to the result to be achieved. However, as it leaves the Member States to choose the form and methods for implementation, the content of the Directive is not directly effective.

NOTES See notes at Art. 1.

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8 THE TERM DIRECTIVE Gemma Minero

DIRECTIVE 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights. Official Journal L 290, 24/11/1993 (Codified version: Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights. Official Journal L 372, 27/12/2006) (Amended by: Directive 2011/77/EU of the European Parliament and of the Council of 27 September 2011 amending Directive 2006/116/EC on the term of protection of copyright and certain related rights. Official Journal L 265/1, 24/11/1993)

CHAPTER I: OBJECTIVE AND GENERAL REMARKS REGARDING DURATION OF AUTHORS’ RIGHTS

CHAPTER IV: SPECIAL RULES FOR UNPUBLISHED WORKS

ARTICLE 1: DURATION OF AUTHORS’ RIGHTS

ARTICLE 4 PROTECTION OF PREVIOUSLY UNPUBLISHED WORKS

I.

GENERAL REMARKS AND INTRODUCTION TO THE DIRECTIVE 8.01

II. DURATION OF AUTHORS’ RIGHTS

8.13

CHAPTER II: SPECIAL RULES FOR CINEMATOGRAPHIC OR AUDIOVISUAL WORKS

AUTHORSHIP OF CINEMATOGRAPHIC OR AUDIOVISUAL WORKS

II. CALCULATION OF THE TERM OF THE PROTECTION

COMMENTS

8.54

CHAPTER VI: SPECIAL RULES FOR PHOTOGRAPHS ARTICLE 6 PROTECTION OF PHOTOGRAPHS

8.30

I.

COMMENTS

8.56

CHAPTER VII: TREATMENT OF ALIENS ARTICLE 7 PROTECTION VIS-À-VIS THIRD COUNTRIES

ARTICLE 3 (AS MODIFIED BY DIRECTIVE 2011/77/EU): DURATION OF RELATED RIGHTS DURATION OF RELATED RIGHTS. GENERAL RULES

8.52

CHAPTER V: REMARKS ON (NATIONAL) PROTECTION OF CRITICAL AND SCIENTIFIC PUBLICATIONS

I. 8.25

CHAPTER III: DURATION OF RELATED RIGHTS, EXTENDED TERMS FOR PERFORMERS AND PRODUCERS OF PHONOGRAMS

I.

COMMENTS

ARTICLE 5 CRITICAL AND SCIENTIFIC PUBLICATIONS

ARTICLE 2: CINEMATOGRAPHIC OR AUDIOVISUAL WORKS I.

I.

I. 8.35

II. SPECIFIC RULES FOR PERFORMERS AND PRODUCERS OF PHONOGRAMS. AMENDMENTS INTRODUCED BY DIRECTIVE 2011/77/EU 8.44

COMMENTS

8.60

CHAPTER VIII: RULES FOR CALCULATING TERMS OF PROTECTION ARTICLE 8 CALCULATION OF TERMS I.

COMMENT

8.64

CHAPTER IX: REMARKS ON MORAL RIGHTS ARTICLE 9 MORAL RIGHTS

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ARTICLE 1: DURATION OF AUTHORS’ RIGHTS I.

COMMENTS

8.66

CHAPTER XIII: INITIAL REPEAL

CHAPTER X: EFFECTS OF THE DIRECTIVE ON RUNNING TERMS AND OTHER RULES OF APPLICATION IN TIME

ARTICLE 11 OF THE INITIAL VERSION, ABOLISHED IN THE CODIFIED VERSION – TECHNICAL ADAPTATION

ARTICLE 10 APPLICATION IN TIME

I.

I.

CHAPTER XIV: REPEAL OF THE INITIAL VERSION OF THE DIRECTIVE

LONGER TERMS OF PROTECTION OF COPYRIGHT OR RELATED RIGHTS ALREADY RUNNING IN A MEMBER STATE 8.68

II. APPLICATION IN TIME OF THE DIRECTIVE

8.69

COMMENTS

8.83

ARTICLE 12 (CODIFIED VERSION) REPEAL I.

COMMENTS

8.85

III. APPLICATION IN TIME OF THE MODIFICATIONS INTRODUCED BY DIRECTIVE 2011/77/EU 8.77

CHAPTER XV: SOME CONSIDERATIONS ABOUT THE ENTRY INTO FORCE OF THE DIRECTIVE

CHAPTER XI: SOME REMARKS ON NATIONAL TRANSITIONAL MEASURES

ARTICLE 13 DIRECTIVE 2006/116 AND ARTICLE 4 OF DIRECTIVE 2011/77/EU – ENTRY INTO FORCE

ARTICLE 10A TRANSITIONAL MEASURES I.

COMMENTS

I. 8.79

CHAPTER XII: NOTIFICATION AND COMMUNICATION OBLIGATIONS

COMMENTS

8.86

ARTICLE 14 OF DIRECTIVE 2006/116 AND ARTICLE 5 OF DIRECTIVE 2011/77/EU ADDRESSEES

ARTICLE 11 (CODIFIED VERSION) NOTIFICATION AND COMMUNICATION I.

COMMENTS

CHAPTER XVI: ADDRESSEES

I.

COMMENTS

8.88

8.81

CHAPTER I OBJECTIVE AND GENERAL REMARKS REGARDING DURATION OF AUTHORS’ RIGHTS ARTICLE 1: DURATION OF AUTHORS’ RIGHTS 1. 2. 3.

4.

5. 6.

The rights of an author of a literary or artistic work within the meaning of Article 2 of the Berne Convention shall run for the life of the author and for 70 years after his death, irrespective of the date when the work is lawfully made available to the public. In the case of a work of joint authorship, the term referred to in paragraph 1 shall be calculated from the death of the last surviving author. In the case of anonymous or pseudonymous works, the term of protection shall run for 70 years after the work is lawfully made available to the public. However, when the pseudonym adopted by the author leaves no doubt as to his identity, or if the author discloses his identity during the period referred to in the first sentence, the term of protection applicable shall be that laid down in paragraph 1. Where a Member State provides for particular provisions on copyright in respect of collective works or for a legal person to be designated as the rightholder, the term of protection shall be calculated according to the provisions of paragraph 3, except if the natural persons who have created the work are identified as such in the versions of the work which are made available to the public. This paragraph is without prejudice to the rights of identified authors whose identifiable contributions are included in such works, to which contributions paragraph 1 or 2 shall apply. Where a work is published in volumes, parts, instalments, issues or episodes and the term of protection runs from the time when the work was lawfully made available to the public, the term of protection shall run for each such item separately. In the case of works for which the term of protection is not calculated from the death of the

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Chapter 8 THE TERM DIRECTIVE

author or authors and which have not been lawfully made available to the public within 70 years from their creation, the protection shall terminate. The term of protection of a musical composition with words shall expire 70 years after the death of the last of the following persons to survive, whether or not these persons are designated as co-authors: the author of the lyrics and the composer of the musical composition, provided that both contributions were specifically created for the respective musical composition with words.

7.

I. GENERAL REMARKS AND INTRODUCTION TO THE DIRECTIVE 8.01 There are no eternal copyright and related rights. These rights are in nature time limited. As it is known, copyright has its roots in the privileges and regulations associated with the advent of printing in the fifteenth century. After Gutenberg perfected the use of moulded metal type around 1450, the Governments and Sovereigns of Western Europe decided to control the printing presses by granting permission to print (privileges) to particular persons in order to protect local printing industries against piracy and foreign import. The privileges were territorial in nature and were for a limited term of years.1 Initial privileges of the fifteenth century in the main protected the printer rather than the author. The first law to recognise a general right to the authors themselves to control the printing of their works was the British Act of 1710, which created a single regime for application both in England and in Scotland. The English Act gave the ‘sole right and liberty of printing books’, not to the printers, but to the authors of the books, and this right was time-limited: 14 years for newly published works, renewable for a further 14 years if the author was still living at the expiration of the first period. After that some other national laws were passed, all of them based on the same idea: that copyright should not provide an eternal protection. 8.02 From the international perspective, there is no universal term of protection for copyright, even among the countries that are Members of the Berne Union. Article 7(1) of the Berne Convention regulates a minimum floor, life of the author and 50 years after his death, but Article 7(6) gives freedom to extend this term.2 8.03 Before its harmonisation, the term of copyright and related rights in the EU Member States’ laws varied significantly. However, in relation to copyright there was one thing in common: national laws and international and regional instruments on copyright provide for terms of protection for the author’s rights based on the life of the author, plus a fixed term of years, that varies among countries.3 For the related rights of performers, producers, etc., protection is calculated on the basis of a fixed term of years beginning at a certain event, such as the giving of the performance or the making of the recording.4 8.04 For example, in the United Kingdom and in the majority of Member States, the duration of copyright was the author’s life plus 50 years post mortem auctoris (pma). This option was followed by most Member States, adopting the Berne Convention’s minimum requirement for copyright 1 2 3

4

See C. Waelde, A. Brown, S. Kheria and J. Cornwell, Contemporary Intellectual Property Law and Policy, 5th ed., OUP, Oxford, 2019, 34 ff. See P. Goldstein and B. Hugenholtz, International Copyright. Principles, Law and Practice, 3th ed., OUP, Oxford, 2013, 284. There are some exceptions for the establishment of periods of author’s right protection on bases other than life plus a fixed term of years. In this chapter, we will talk about anonymous and pseudonymous works. Besides, beyond the EU, of particular interest in this connection is s.302 of the US Copyright Act 1976, which provides that in the case of a work made for hire the copyright lasts for 95 years from the year of first publication or a term of 120 years from its creation, whichever expires first. See J. A. L. Sterling, Sterling on World Copyright Law, 5th ed., Sweet & Maxwell Thomson Reuters, London, 2015, 533 ff.

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ARTICLE 1: DURATION OF AUTHORS’ RIGHTS

protection (Art. 7(1)).5 At European level, this solution was firstly adopted in the Computer Programs Directive of 1991 (Art. 1(1)). However, there were also variations between EU Member States.6 In Austria, Belgium, Germany and Greece it was life plus 70 years pma.7 In Spain, from 1879 to 1987, the duration was the longest one among EU countries: author’s life plus 80 years pma.8 In France the protection of musical works without words was life plus 70 years pma, and for other types of works, it was life plus 50 years pma. Besides, several countries provided for extensions for copyright terms running during the World Wars.9 The same happened with related rights. Indeed, for neighbouring rights, such as rights in 8.05 phonograms, performers’ rights and rights in broadcasts, the variation was even wider, since not all EU Member States were party to the Rome Convention10 and not all EU countries offered specific protection for such rights (e.g. Belgium and the Netherlands did not offer such protection). These differences concerned both the duration of the protection itself and the point for calculating 8.06 this protection. Therefore, the Term Directive seeks to harmonise these two issues, as differing terms of protection in the Member States may form an obstacle to the functioning of the Internal Market (Recital 3). When providing this harmonisation, the European legislature aimed to achieve a high level of protection of copyright and related rights, since these rights are fundamental to intellectual creation. Consequently, their protection ensures the maintenance and development of creativity in the interest of authors, but also of the society as a whole (Recital 11). This problem was addressed by the European Court of Justice (ECJ) in EMI v. Patricia in 1989, 8.07 which highlighted the difficulties that an unharmonised system entailed (in this case concerning related rights in sound recordings).11 The preliminary question arose in proceedings between EMI Electrola GmbH – a German undertaking, to which a British company, EMI Records Ltd., assigned reproduction and distribution rights in musical works performed by the British singer Cliff Richard, and two other German undertakings, Patricia Im-und Export and Lüne-ton,

5

6 7

8

9

10

11

According to Art. 7(6) of this international treaty, ‘The countries of the Union may grant a term of protection in excess of those provided by the preceding paragraphs’. See S. Ricketson and J. C. Ginsburg, International Copyright and Neighbouring Rights. The Berne Convention and Beyond, 2nd ed., OUP, Oxford, 2005, 562 ff; and P. Torremans, Holyoak and Torremans Intellectual Property Law, 6th ed., OUP, Oxford, 2010, 215 ff. See for an overview R. Davis, T. Quintin and G. Tritton, Tritton on Intellectual Property in Europe, 5th ed., Sweet & Maxwell, London, 2019, 515 (Tritton). With regard to the 70-year term already provided for in some Member States, Art. 8(2) of Directive 91/250 on computer programs left it to the discretion of the national legislature to ‘maintain their present term until such time as the term of protection for copyright works is harmonised by Community law in a more general way’. See Y. Gaubiac, B. Linder and J. N. Adams, ‘Duration of Copyright’, in E. Derclaye (ed), Research Handbook on the Future of the EU Copyright, Elgar Edward Publishing, Cheltenham, UK and Northampton, MA, USA, 2009, 159 ff. That is, the time the Spanish Copyright Act of 1879 was in effect, until it was repealed by the Copyright Act of 1987. Pursuant to the transitional provisions of the Copyright Act 1987, this term is still applicable to works the authors of which died prior to the coming into effect of the new Copyright Act 1987. E.g. in France, the term of protection was extended for a further term of 30 years if the author died for France, as recorded in the death certificate. See D. Visser, ‘Term Directive’, in T. Dreier and B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law International, Alphen aan den Rijn, 2006, 287. In addition, this international convention laid down only minimum terms of protection of the rights they refer to, leaving the Contracting States free to grant longer terms and certain Member States had exercised this entitlement. This minimum was short: 20 years. However, this international convention was useful regarding the time when the protection period begins to run: (a) the end of the year in which the fixation was made – for phonograms and for performances incorporated therein; (b) the end of the year in which the performance took place – for performances not incorporated in phonograms; and (c) the end of the year in which the broadcast took place – for broadcasts (Art. 14). Case C-341/87 EMI Electrola GmbH v. Patricia Im-und Export Verwaltungsgesellschaft GmbH [1989] ECR I-79. Although it was only cited as one of the issues requiring immediate action in the Green Paper on Copyright and the Challenge in Technology (COM (88) 172, June 1988), the European legislature focused on it later. It was the ECJ which first faced the problem in the EMI v. Patricia case.

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Chapter 8 THE TERM DIRECTIVE

which sold, in Germany, sound recordings originating in Denmark and incorporating the abovementioned musical works. The sound recordings in question were manufactured in Germany by Patricia at the commission of a Danish undertaking and delivered to Denmark before being re-exported to Germany. The Danish undertaking was not the one to which EMI Records Ltd. had assigned reproduction and distribution rights in those musical works for the territory of Denmark. EMI Electrola, alleging an infringement of its exclusive distribution rights for sound recordings in German territory, brought an action for damages and for an injunction restraining Patricia Im-und Export and Lüne-ton from continuing to sell sound recordings imported from Denmark. The two defendant companies contended that the sound recordings had been lawfully marketed in Denmark because the period during which exclusive rights were protected under Danish copyright law had already expired. Therefore, the fact that the sound recordings were lawfully marketed in another Member State was due, not to an act or the consent of the copyright owner, but to the expiry of the protection period provided for by the legislation of that Member State.12 8.08 The ECJ upheld the claim of the German rightholder, concluding that Articles 30 and 36 of the EEC Treaty must be interpreted as not precluding the application of German law in order to allow Electrola to prohibit the sale made by Patricia and Lüne-ton in Germany. The ECJ stated that ‘the problem arising thus stems from the differences between national legislation regarding the period of protection afforded by copyright and related rights, those differences concerning either the duration of the protection or the details thereof, such as the time when the protection period begins to run’.13 The ECJ observed that ‘in the present state of Community law, which is characterised by a lack of harmonization or approximation of legislation governing the protection of literary and artistic property, it is for the national legislatures to determine the conditions and detailed rules for such protection’.14 8.09 Consequently, the ECJ concluded, the restrictions on intra-Community trade in sound records that have arisen because of the disparity between national laws were linked to the very existence of the copyright and related rights and did not constitute a means of arbitrary discrimination or a disguised measure to restrict trade. Such restrictions are thus justified under Article 36 of the EEC Treaty.15 8.10 The next step was taken by the European Commission, with the Follow-up to the Green Paper 1991 – Working Programme of the Commission in the Field of Copyright and Neighbouring Rights (COM/90/584). This EU institution, intending to draw up a proposal for a directive on this subject, pointed out the need to provide a total harmonisation, setting out both the periods of protection and the same commencement and expiry time and creating a high-level protection, with terms of protection longer than the minimum period established in existing international conventions.16 8.11 The Commission tabled its Proposal for a Directive harmonising the term of protection of copyright and certain related rights on 23 March 1992.17 After an Amended Proposal of 7 January

12

13 14 15 16

17

The national court – the Landgericht Hamburg – took the view that EMI Electrola’s application was justified under German law, but also that a question might arise as to whether Arts 30 and 36 of the EEC Treaty prevented the application of the national legislation (Arts 34 and 36 of the TFEU). Para. 10. Para. 11. See H. Cohen Jehoram, ‘The EC Copyright Directives, Economics and Authors’ Rights’ (1994) 25 IIC 824; and Tritton, note 6, 515. On a criticism to this extension, outlining whether in today’s society there is actually a need for an author to provide for his or her grandchildren past his or her demise, See M. Van Eechoud, P. B. Hugenholtz, S. Gompel, L. Guibault and N. Helberger, Harmonizing European Copyright Law. The Challenges of Better Lawmaking, Wolters Kluwer International, Alphen aan den Rijn, 2009, 58. On the lack of indication that ‘life plus two generations’ argument played a role in the Berne Convention, see Ricketson and Ginsburg, note 5, 536 ff. COM (92) 33 final.

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1993,18 which reflected some of the modification proposals submitted by the European Parliament, the Council of the European Communities finally ratified Council Directive 93/98/EEC harmonising the term of protection of copyright and certain related rights on 29 October 1993, with the requirement for implementation in Member States by 1 July 1993.19 The initial Term Directive was adopted in 1993, but it was amended in 2001, by Directive 8.12 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society and, so in the interests of clarity and rationality, the said Directive was codified in 2006 (Directive 2006/116/EC, adopted on 12 December 2006). In 2011 it was also substantially modified by Directive 2011/77/EU of the European Parliament and of the Council of 27 September 2011 amending Directive 2006/116/EC on the term of protection of copyright and certain related rights, but no new codified version has been adopted until now. Directive 2011/77/EU was to be implemented by 1 November 2013. This last amendment provides for a harmonised approach to the calculation of the term of protection for copyright for musical compositions with words, where the separate contributions are distinguishable, and extends the term of protection for phonograms and performances. No extension is provided for film producers and for performances fixed in a medium other than a phonogram, thus creating some unjustified differences. Besides, Directive 2011/77/EU gives performers who have assigned their rights of fixation to a phonogram producer a right to terminate the transfer in case the phonogram is not sufficiently exploited within 50 years from its first lawful publication.

II. DURATION OF AUTHORS’ RIGHTS The Term Directive adopted a policy of harmonising upwards. According to the basic rule of 8.13 Article 1(1) the term of protection for literary and artistic works shall run for the life of the author plus for 70 years after his death, where the international minimum standard was 50 years.20 Thus, the date when the work is lawfully made available to the public is not relevant. Recitals 6, 7 and 11 try to justify this on the growing average lifespan in the EU and the effects of the World Wars on the exploitation of works and promotion of creativity.21 For Member States with shorter terms, the effect of the Term Directive is that copyright revives for certain works in which it had expired. On

18 19

20 21

Amended Proposal for a Council Directive harmonizing the term of protection of copyright and certain related rights, COM (92) 602 final. Both the Economic and Social Committee and the European Parliament appreciated the initiative, but they suggested some modifications. The considerations accepted by the European Commission were the ones coming from the European Parliament. In particular, the Amended Proposal applies to questions such as the initial ownership of cinematographic works, the protection of posthumous works and the revival of protection of works already in the public domain. See M. M. Walter and S. Von Lewinski, European Copyright Law. A Commentary, OUP, Oxford, 2010, 508–10. From Art. 7(6) Berne Convention and Art. 12 TRIPs Agreement it is deduced that these instruments provide only for minimum periods of protection, not maximum terms, so there is no conflict with the Directive. Recital 6: The minimum term of protection laid down by the Berne Convention, namely the life of the author and 50 years after his death, was intended to provide protection for the author and the first two generations of his descendants. The average lifespan in the Community has grown longer, to the point where this term is no longer sufficient to cover two generations. Recital 7: ‘Certain Member States have granted a term longer than 50 years after the death of the author in order to offset the effects of the world wars on the exploitation of authors’ works.’ In addition, Recital 11 states: The level of protection of copyright and related rights should be high, since those rights are fundamental to intellectual creation. Their protection ensures the maintenance and development of creativity in the interest of authors, cultural industries, consumers and society as a whole. Visser, note 9, 278 ff, highlights that lengthening the term of protection would strengthen the position of the author during his lifetime when negotiating the assignment of his rights.

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the other hand, Member States with longer terms are allowed to let those terms run their course, but only in relation to existing works – not for those works which were created after the approval of the Directive.22 8.14 At the international level, the Term Directive influenced further States to follow the European model. The US, among others. The US Copyright Extension Act of 1998 extended the initial 50-year pma term to 70 years following the death of the author. 8.15 The Term Directive provides for the full term of 70 years for all the categories of works without any exception.23 Article 1 of the Term Directive refers to any ‘literary or artistic work within the meaning of Article 2 of the Berne Convention’, the catalogue laid down in this provision of the Berne Convention being numerus apertus. If not specified to the contrary, the term of 70 years applies also to computer programs, in order to be consistent with the protection of software under copyright law. In this respect, Article 11(1) of the Term Directive of 1993 repealed Article 8(1) of the initial version of the Computer Directive of 1991, which had provided a minimum term of life of the author plus 50 years pma.24 8.16 No special protection or rule is provided by the Term Directive regarding posthumous works, that is, works first published or made accessible to the public after the author’s death. Consequently, the normal rule (author’s life plus 70 years) is applicable.25 It follows the rule contained within the Berne Convention: such works enjoy the normal period of protection. The absence of any specific rule must be understood as an actual incentive for the author’s heirs to publish posthumous works as soon as possible. The earlier the author’s heirs publish the work, the longer the term of protection, since the term of 70 years will always be calculated from the author’s death, irrespective of the date when the work is lawfully made available to the public. 8.17 For works of joint authorship, the European legislature followed Article 7bis of the Berne Convention, which provided that the term of protection is calculated from the death of the last surviving author (Art. 1(2) of the Directive). Works are protected during the author’s lives and 70-year term after the death of the last surviving author. The problem is that no definition of joint authorship is contained within the Directive.26 Therefore, the doubts arise on whether the mere combining of two original pieces for the purpose of joint exploitation results in joint authorship or, on the contrary, whether the contribution of each author must not be distinguishable from the contribution of the other authors in a work of joint authorship.27 8.18 Taking this problem into account, the rule regarding a musical composition with words, which was introduced by Directive 2011/77/EU, was necessary. Article 1 establishes the application of this rule taking into account the deaths of the author of the lyrics and the composer of the musical composition ‘whether or not these persons are designated as co-authors’ in the national system.

22 23 24 25 26 27

See commentary to Art. 10. Original photographs and works of applied art are also included within this. See commentary to Art. 6 of the Term Directive. See commentary to Art. 11 of the initial version of the Term Directive. However, Art. 10(1) of the Directive allows for a longer term of protection, where this was already running on 1 July 1995. Recital 14 states: ‘The question of authorship of the whole or a part of a work is a question of fact which the national courts may have to decide.’ This latter strict concept is followed by the UK and Germany, but most Member States have adopted the former concept, which is broader. Some authors have interpreted the absence of a binding concept of joint authorship as a wide scope left to the national legislation. The interpretation provided by each Member State is relevant, since following the strict concept means that the term will be computed separately for each contribution in a composed work. See J. Ellins, Copyright Law, Urheberrecht und ihre Harmonisierung in der Europäischen Gemeinschaft – Von der Anfängen bis ins Informationszeitalter, Duncker & Humblot, Berlin, 1997, 298; and Walter and Von Lewinski, note 19, 529.

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Before the amendment of 2011, the protection of such co-written musical compositions was calculated differently among the different Member States; they were either classified as a single work of joint authorship with a unitary term of protection or as separate works with separate terms for each individual author, giving rise to obstacles to the free movement of goods and services.28 Therefore, the amendment aims at avoiding a single piece of music having different terms of protection in different Member States.29 Irrespective of whether they are classified as co-authors, the protection of every musical composition with words will last until the death of the last surviving author of the lyrics or composer of the music (new Art. 1(7) of the Term Directive). It has to be taken into account that Directive 2011/77/UE did not seek to harmonise the definitions 8.19 concerning joint authorship and collaborative and collective works, so this rule applies irrespective of the category into which the musical work falls in the national jurisdiction. In relation to other kinds of works – other than musical works – with two or more authors, a different treatment applies in different EU Member States with respect to duration. The rule of the date of the author’s death causes practical difficulties regarding anonymous and 8.20 pseudonymous works. The European legislature (Art. 1(3) of the Directive) followed Article 7(3) of the Berne Convention in stating that the term of protection for anonymous and pseudonymous works runs for 70 years after the work is lawfully made available to the public, that is, when the work is published with the author’s or the rightholder’s consent.30 The regular term of protection computed from the author’s death applies in the whole EU when the author discloses his identity during the period of 70 years after the work is lawfully made available to the public, whether the disclosure of the author’s identity takes place in the EU or not. This rule is commonly applied when the pseudonym used by the author leaves no doubt as to the author’s identity. When the disclosure of the author’s identity takes place after the period of 70 years pma, it has no effect of reviving the expired protection. With regard to the lack of harmonisation of the initial ownership of copyright in general, Article 8.21 1(4) of the Term Directive leaves wide scope to national legislation to establish particular provisions on copyright in respect of collective works or for a legal person to be designated as the rightholder.31 However, when a national legislature makes use of this possibility, the term of protection shall be calculated according to Article 1(3), that is, the protection runs for 70 years after the work is lawfully made available to the public.32 There is only one exception to this rule: when the natural persons who have created the work are identified as such in the versions of the work which are made available to the public, the term shall be computed according to the general rule that is laid down in Article 1(1) and (2). Consequently, this collective work will be protected during the life of the author or authors plus 70 years pma.

28 29 30

31

32

See Recital 18 of Directive 2011/77/EU. See the Directive for Term Extension, Frequently Asked Questions, MEMO/11, Brussels, 12 September 2011. Art. 7(3) of the Berne Convention states that the term of protection shall expire 50 years after the work has been lawfully made available to the public. The term provided by the US Copyright Act is much longer. Art. 302(c) provides that ‘[i]n the case of an anonymous work, a pseudonymous work, or a work made for hire, the copyright endures for a term of 95 years from the year of its first publication, or a term of 120 years from the year of creation, whichever expires first’. Because of the absence of a general harmonisation of the concept of work of authorship, the Term Directive has resulted in a limited harmonisation only. There are some remaining interpretation problems regarding joint authorship. See C. Angelopoulos, ‘The Myth of European Term Harmonisation: 27 Public Domains for 27 Member States’ (2012) 5 IIC 567; and Van Eechoud, et al., note 16, 64–5. E.g. Dutch, French and Spanish legislations, which allow copyright in a collective work to vest in a corporate entity, measure the term of economic rights in these works as 70 years from the beginning of the year following the year of publication. See Art. 38(2) of the Dutch Copyright Act; Arts L. 113-2, 113-5 and 123-3 of the French Intellectual Property Code; and Arts 8 and 28(2) of the Spanish Intellectual Property Law.

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8.22 Article 1(6) provides for a special rule for works for which the term of protection is not calculated from the death of the authors: protection ceases when these works have not been lawfully made available to the public within 70 years from their creation. It follows the logic contained in Article 12 of the TRIPS Agreement. Once again, the purpose of this provision is to create an incentive for the author or his heirs to publish the works as soon as possible. 8.23 Regarding protection of works published in several volumes, parts, instalments, issues or episodes, Article 1(5) of the Term Directive states that the term shall run separately for each item from the time when it was lawfully made available to the public. Therefore, the term is not calculated from the publication of the last issue. 8.24 The ECJ has concluded that the harmonisation of the term of protection in the EU does not restore the protection of works that were already in the public domain in all EU Member States on the date when the Directive came into force.33

NOTES 1. Related instruments The Directive for Term Extension, Frequently Asked Questions, MEMO/11, Brussels, 12 September 2011. Article 1 Dir. 2011/77 amending Directive 2006/116/EC. Articles 34 and 36 Treaty on the Functioning of the European Union. Articles 9(1) and 12 TRIPs Agreement. Amended Proposal for a Council Directive harmonizing the term of protection of copyright and certain related rights, COM (92) 602 final. Proposal for a Directive harmonizing the term of protection of copyright and certain related rights on 23 March 1992, COM (92) 33 final. Article 8 Dir. 91/250 on computer programs. Green Paper on Copyright and the Challenge in Technology (COM (88) 172, June 1988). Article 7(6) Berne Convention for the Protection of Literary and Artistic Works. Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations. Articles 30 and 36 EEC Treaty.

2. CJEU case law Case C-341/87 EMI Electrola GmbH v. Patricia Im-und Export Verwaltungsgesellschaft GmbH [1989] ECR I-79. Case C-169/15, Montis Design BV v. Goossens Meubelen BV [2016].

3. Bibliography Angelopoulos, C., ‘The Myth of European Term Harmonisation: 27 Public Domains for 27 Member States’ (2012) 5 IIC, 567. Cohen Jehoram, H., ‘The EC Copyright Directives, Economics and Authors’ Rights’ (1994) 25 IIC 824. Davis, R., T. Quintin and G. Tritton, Tritton on Intellectual Property in Europe, 5th ed., Sweet & Maxwell, London, 2019, 1. Ellins, J., Copyright Law, Urheberrecht und ihre Harmonisierung in der Europäischen Gemeinschaft – Von der Anfängen bis ins Informationszeitalter, Duncker & Humblot, Berlin, 1997. Gaubiac, Y., B. Linder and J. N. Adams, ‘Duration of Copyright’, in E. Derclaye (ed), Research Handbook on the Future of the EU Copyright, Elgar Edward Publishing, Cheltenham, UK and Northampton, MA, USA, 2009, 148. Goldstein, P. and B. Hugenholtz, International Copyright. Principles, Law and Practice, 3th ed., OUP, Oxford, 2013, 284.

33

Case C-169/15, Montis Design BV v. Goossens Meubelen BV [2016] ECLI:EU:C:2016:790. See commentary to Art. 10.

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ARTICLE 2: CINEMATOGRAPHIC OR AUDIOVISUAL WORKS Ricketson, S., The Berne Convention for the Protection of Literary and Artistic Works: 1886–1986, Kluwer, Deventer, 1987. Ricketson, S. and J. C. Ginsburg, International Copyright and Neighbouring Rights. The Berne Convention and Beyond, 2nd ed., OUP, Oxford, 2005. Sterling, J. A. L., Sterling on World Copyright Law, 5th ed., Sweet & Maxwell Thomson Reuters, London, 2015. Torremans, P., Holyoak and Torremans Intellectual Propert Law, 6th ed., OUP, Oxford, 2010. Van Eechoud, M, P. B. Hugenholtz, S. Gompel, L. Guibault and N. Helberger, Harmonizing European Copyright Law. The Challenges of Better Lawmaking, Wolters Kluwer International, Alphen aan den Rijn, 2009. Visser, D., ‘Term Directive’, in T. Dreier and B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law International, Alphen aan den Rijn, 2006, 287. Waelde, C., A. Brown, S. Kheria and J. Cornwell, Contemporary Intellectual Property Law and Policy, 5th ed., OUP, Oxford, 2019, 34 ff. Walter, M. M. and S. Von Lewinski, European Copyright Law. A Commentary, OUP, Oxford, 2010.

CHAPTER II SPECIAL RULES FOR CINEMATOGRAPHIC OR AUDIOVISUAL WORKS ARTICLE 2: CINEMATOGRAPHIC OR AUDIOVISUAL WORKS 1. 2.

The principal director of a cinematographic or audiovisual work shall be considered as its author or one of its authors. Member States shall be free to designate other co-authors. The term of protection of cinematographic or audiovisual works shall expire 70 years after the death of the last of the following persons to survive, whether or not these persons are designated as co-authors: the principal director, the author of the screenplay, the author of the dialogue and the composer of music specifically created for use in the cinematographic or audiovisual work.

COMMENTS I. AUTHORSHIP OF CINEMATOGRAPHIC OR AUDIOVISUAL WORKS Articles 2(1) and 2(2) provide not only for harmonisation of term rules, but also for a substantial 8.25 copyright law harmonisation. Difficulties in determining authorship of these kinds of works arise because they are generally the 8.26 result of a process with several individual contributions. There were many differences among the laws of EU Member States since there was no international provision harmonising the term prior to the adoption of the Term Directive.34 Therefore, harmonisation was necessary throughout the EU. Article 2(1) of the Term Directive sets out the general rule that the principal director of a 8.27 cinematographic work is to be considered its author or, in any case, one of its authors. This rule is also contained within Article 1(5) of Directive 93/83 and Article 2(2) of Directive 2006/115.35 It 34 35

According to Art. 14bis(2)(a) of the Berne Convention ‘ownership of copyright in a cinematographic work shall be a matter for legislation in the country where protection is claimed’. It should be noted at the outset that the various rights to exploit a cinematographic or audiovisual work have been dealt with in a number of directives. First, Chapter II of Directive 93/83, which regulates the satellite broadcasting right. Secondly, the commented Term Directive. Thirdly, the reproduction right and the right of communication to the public through the making available to the public are governed respectively by Arts 2 and 3 of Directive 2001/29. Finally, rental right and lending right are covered by Arts 2 and 3 of Directive 2006/115. See ECJ judgment Case-277/10, Martin Luksan v. Petrus van der Let, 9 February 2012, paras 38, 39, 40 and 44.

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obliged some Member States to alter their national laws to add the director as author of the film. Article 2(1) of the Term Directive allows national authorities to designate other co-authors apart from the principal director. 8.28 The ECJ has interpreted this provision as meaning that the principal director of a cinematographic work (unlike the other authors of such a work) has, in any event, the status of author pursuant to Directive 2006/116, irrespective of any choice made in national law.36 Except for the specific rule concerning the principal director, the Term Directive does not contain a general regulation of the initial ownership of copyright in this kind of works.37 8.29 Article 10(4) leaves national authorities the choice of deciding whether or not to apply Article 2(1) to cinematographic or audiovisual works created before 1 July 1994.

II. CALCULATION OF THE TERM OF PROTECTION 8.30 For the particular purpose of calculating the term of protection the Directive focuses on three relevant persons involved in the creative process, apart from the principal director: the author of the screenplay, the author of the dialogue and the composer of the music specifically created for use in the cinematographic or audiovisual work. This specific rule differs from the one contained in Article 7(2) of the Berne Convention, which does not calculate the term of protection taking into account the death of the authors or the persons participating in the creative process, but from the time of creation or of making the cinematographic work available to the public.38 8.31 The sole purpose of the rule contained in Article 2(2) of the Term Directive is the calculation of the term of protection. It is not an ownership of copyright rule.39 Therefore, it is irrelevant whether those three persons are designated as co-authors of cinematographic or audiovisual works under the national copyright laws or whether a Member State has added some other authors of this kind of works. In the case where the national legislature decided to broaden the list of co-authors, those additional persons considered co-authors under a national law (such as the cameraman and the

36

37

38

See ECJ judgment Case-277/10, ibid., para. 45. Art. 2(2) of the Directive sets the term of protection of cinematographic or audiovisual works but this provision does not harmonise the definition of ownership of copyright in cinematographic or audiovisual works. Consequently, the authorship of the principal director of a cinematographic or audiovisual work is one of the few exceptions to the general lack of harmonisation of initial ownership on the European level. See Angelopoulos, 2012, note 31, 567; and van Eechoud, et al., note 16, 64–5. Art. 7(2) of the Berne Convention establishes: in the case of cinematographic works, the countries of the Union may provide that the term of protection shall expire 50 years after the work has been made available to the public with the consent of the author, or, failing such an event within 50 years from the making of such work, 50 years after the making.

39

The regulation contained in Art. 2(2) of the Term Directive, considering the life of some persons relevant for the computation of the term of protection of cinematographic and audiovisual works, without considering them at the same time authors or rightholders of that work as such, causes problems of interpretation regarding the rights to exploit the cinematographic work and the right to fair compensation. Some of these questions were resolved by the ECJ in Case-277/10, Martin Luksan v. Petrus van der Let, note 35. The ECJ stated that Arts 1 and 2 of Directive 93/83/EEC, Arts 1 and 3 of 2001/29/EC, Arts 1 and 3 of Directive 2006/115/EC and Art. 2 of Directive 2006/116/EC must be interpreted as meaning that rights to exploit a cinematographic work vest by operation of law, directly and originally, in the principal director, but Member States can lay down a presumption of transfer, in favour of the producer of a cinematographic work, of rights to exploit the cinematographic work, provided that such a presumption is not an irrebuttable one precluding the principal director of that work from agreeing otherwise. However, Member States cannot regulate a presumption of transfer, in favour of the producer of a cinematographic work, of the right to fair compensation vesting in the principal director of that work, whether that presumption is couched in irrebuttable terms or may be departed from.

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cutter, in Germany) will enjoy the full term of protection, but their lives are not to be considered for calculating the term of protection. When taking into account the death of the composer of the music, the importance or presence of 8.32 the music in the cinematographic or audiovisual work is not decisive, but the music must have been specifically created to be used in that particular cinematographic or audiovisual work. In other words, it cannot be pre-existing music. Therefore, when the music is not created for that cinematographic or audiovisual project, the calculation of the term of protection will be based on the death of the last surviving person among the other contributors mentioned in this provision. The rule contained in Article 2(2) of the Term Directive does not apply to the underlying works 8.33 related to the cinematographic or audiovisual work, such as the novel or the play that was adapted for the cinema. It only applies to the cinematographic or audiovisual work as such. The other works have their own term of protection. Besides, when the contributions made by the persons mentioned in Article 2(2) of the Term 8.34 Directive or by other contributors to the cinematographic or audiovisual work (such as the dialogue, the screenplay or the music) are considered original as such, those works are protected separately by copyright under national law. The term of protection of that copyright is to be computed under Article 1(1) and (2) of the Term Directive.

NOTES 1. Related instruments Articles 2 and 3 Dir. 2001/29 on information society. Articles 2 and 3 Dir. 2006/115 on rental right and lending right.

2. CJEU case law Case-277/10, Martin Luksan v. Petrus van der Let, ECLI:EU:C:2012:65.

3. Bibliography See Bibliography in Art. 1.

CHAPTER III DURATION OF RELATED RIGHTS. EXTENDED TERMS FOR PERFORMERS AND PRODUCERS OF PHONOGRAMS ARTICLE 3 (AS MODIFIED BY DIRECTIVE 2011/77/EU): DURATION OF RELATED RIGHTS 1.

The rights of performers shall expire 50 years after the date of the performance. However, + if a fixation of the performance otherwise than in a phonogram is lawfully published or lawfully communicated to the public within this period, the rights shall expire 50 years from the date of the first such publication or the first such communication to the public, whichever is the earlier, + if a fixation of the performance in a phonogram is lawfully published or lawfully communicated to the public within this period, the rights shall expire 70 years from

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2.

the date of the first such publication or the first such communication to the public, whichever is the earlier. The rights of producers of phonograms shall expire 50 years after the fixation is made. However, if the phonogram has been lawfully published within this period, the said rights shall expire 70 years from the date of the first lawful publication. If no lawful publication has taken place within the period mentioned in the first sentence, and if the phonogram has been lawfully communicated to the public within this period, the said rights shall expire 70 years from the date of the first lawful communication to the public.

However, this paragraph shall not have the effect of protecting anew the rights of producers of phonograms where, through the expiry of the term of protection granted them pursuant to Article 3(2) of Directive 93/98/EEC in its version before amendment by Directive 2001/29/ EEC, they were no longer protected on 22 December 2002. 2a.

2b.

2c.

2d.

If, 50 years after the phonogram was lawfully published or, failing such publication, 50 years after it was lawfully communicated to the public, the phonogram producer does not offer copies of the phonogram for sale in sufficient quantity or does not make it available to the public, by wire or wireless means, in such a way that members of the public may access it from a place and at a time individually chosen by them, the performer may terminate the contract by which the performer has transferred or assigned his rights in the fixation of his performance to a phonogram producer (hereinafter a ‘contract on transfer or assignment’). The right to terminate the contract on transfer or assignment may be exercised if the producer, within a year from the notification by the performer of his intention to terminate the contract on transfer or assignment pursuant to the previous sentence, fails to carry out both of the acts of exploitation referred to in that sentence. This right to terminate may not be waived by the performer. Where a phonogram contains the fixation of the performances of a plurality of performers, they may terminate their contracts on transfer or assignment in accordance with applicable national law. If the contract on transfer or assignment is terminated pursuant to this paragraph, the rights of the phonogram producer in the phonogram shall expire. Where a contract on transfer or assignment gives the performer a right to claim a non-recurring remuneration, the performer shall have the right to obtain an annual supplementary remuneration from the phonogram producer for each full year immediately following the 50th year after the phonogram was lawfully published or, failing such publication, the 50th year after it was lawfully communicated to the public. The right to obtain such annual supplementary remuneration may not be waived by the performer. The overall amount to be set aside by a phonogram producer for payment of the annual supplementary remuneration referred to in paragraph 2b shall correspond to 20 % of the revenue which the phonogram producer has derived, during the year preceding that for which the said remuneration is paid, from the reproduction, distribution and making available of the phonogram in question, following the 50th year after it was lawfully published or, failing such publication, the 50th year after it was lawfully communicated to the public. Member States shall ensure that phonogram producers are required on request to provide to performers who are entitled to the annual supplementary remuneration referred to in paragraph 2b any information which may be necessary in order to secure payment of that remuneration. Member States shall ensure that the right to obtain an annual supplementary remuneration as referred to in paragraph 2b is administered by collecting societies.

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2e.

3.

4.

Where a performer is entitled to recurring payments, neither advance payments nor any contractually defined deductions shall be deducted from the payments made to the performer following the 50th year after the phonogram was lawfully published or, failing such publication, the 50th year after it was lawfully communicated to the public. The rights of producers of the first fixation of a film shall expire 50 years after the fixation is made. However, if the film is lawfully published or lawfully communicated to the public during this period, the rights shall expire 50 years from the date of the first such publication or the first such communication to the public, whichever is the earlier. The term ‘film’ shall designate a cinematographic or audiovisual work or moving images, whether or not accompanied by sound. The rights of broadcasting organisations shall expire 50 years after the first transmission of a broadcast, whether this broadcast is transmitted by wire or over the air, including by cable or satellite.

COMMENTS I. DURATION OF RELATED RIGHTS. GENERAL RULES Regarding the term of protection of traditional related rights, the original Rental Right Directive as 8.35 adopted in 1992 (Art. 12) referred to the Rome Convention, which provided only for a minimum term of protection of 20 years for performers, producers of phonograms and broadcasting organisations. This term was calculated from the fixation of the phonogram, from the date of the performance or from the date of the transmission of a broadcast, respectively (Art. 14). The European Directive extended this rule to first fixation of films, which are not covered by the Rome Convention. However, the term of protection as provided in national laws varied widely among EU Member 8.36 States, since they were also party to the Geneva Phonogram Convention, which also established a minimum 20-year term, but expressly leaves wide scope to national legislation to provide for longer protection (Art. 4).40 Indeed, some Member States had made use of the possibility of extending the term of protection of these related rights to 50 years. Besides, the TRIPS Agreement, which entered into effect on 1 January 1995, has to be taken into account. Article 14(5) of the TRIPS Agreement provides for two rules: (i) performers and producers of phonograms are granted a minimum period of protection for performers of 50 years from the end of the calendar year in which the fixation of their performance or the performance took place, and (ii) broadcasters are protected for a period of at least 20 years from the end of the calendar year in which the broadcast took place. Consequently, with the aim of harmonising the terms of protection for both copyright and related 8.37 rights at a high level (Recital 11 of the codified version), the European legislature prescribed, in Article 3 of the Term Directive, a fixed term of 50 years for the four categories of related rights, i.e. performers, producers of phonograms, producers of films and broadcasting organisations.41 Article 11(2) of the Term Directive repealed Article 12 of the 1992 Directive. The European 50-year term has been followed by Article 18 of the WPPT, regarding performing artists and producers of phonograms.42

40 41 42

For an overview, see Van Eechoud, et al., note 16, 64. On the differences among EU Member States laws, P. Kamina, ‘Subject-Matter for Film Protection in Europe’, in Derclaye (ed.), note 7, 77–87. On the legislative history and the understanding of the terms ‘performer’, ‘producer of phonograms’, ‘producer of films’ and ‘broadcasting organisations’, see Sterling, note 4, 575–8; and Walter and von Lewinski, note 19, 558–61. However, this last provision regulates a reduced term of 20 years for broadcasting organisations.

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Chapter 8 THE TERM DIRECTIVE

8.38 Although the full 50-year term of protection applies to all of these related rights and is calculated from 1 January following the relevant event that sets off the term, these events differ for each type of related right.43 The place where these acts were performed, whether in the European territory or in a third country, is not decisive. 8.39 As to performers, the 50-year period, as a general rule, runs from the date of the performance, irrespective of whether such a performance is fixed and takes place publicly or not.44 However, Article 3(1) second sentence traditionally provided a specific rule: if a fixation of the performance is lawfully fixed in a sound recording, published or lawfully communicated to the public within this period of 50 years from the performance, the term of 50 years of protection was calculated from the first publication or communication to the public, whichever is the earlier, provided they take place within the first period. Theoretically, this could lead to a maximum protection of 100 years after the said dates, but it is not very common to publish or communicate sound recordings so late (close to the end of the first 50-year period).45 Article 3(1) of the codified version of the Term Directive (Directive 2006/116/CE) was in similar terms. However, this specific rule has been amended by Directive 2011/77/EU. This new Directive brought the protection afforded to performers of phonograms further into line with that provided to authors, namely 70 years from the date of the first lawful publication or communication to the public – the performer’s life is not taken into account – as we shall see in the next section.46 8.40 For film producers, the term of protection expires 50 years after the date of the fixation.47 Directive 2011/77/EU did not extend to film producers the new rule applicable to phonogram producers.48

43

Recital 17 of the codified version emphasises this idea: In order to avoid differences in the term of protection as regards related rights it is necessary to provide the same starting point for the calculation of the term throughout the Community. The performance, fixation, transmission, lawful publication, and lawful communication to the public, that is to say the means of making a subject of a related right perceptible in all appropriate ways to persons in general, should be taken into account for the calculation of the term of protection regardless of the country where this performance, fixation, transmission, lawful publication, or lawful communication to the public takes place.

44 45 46

47 48

On the difficulties of proving copyright and related rights infringements when there is no fixation, see A. Latreille, ‘From Idea to Fixation: A View of Protected Works’ in Derclaye (ed), note 7, 133 ff. See A. Kur and T. Dreier, European Intellectual Property Law. Text, Cases and Materials, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2013, 262. The initial Proposal for a Directive – Proposal for a European Parliament and Council Directive amending Directive 2006/116/EC of the European Parliament and of the Council on the term of protection of copyright and certain related rights, COM(2008) 464/3 – foresaw a term of 95 years after the publication or the communication to the public of the phonogram. However, this extension attracted criticisms, which were expressed in an open letter signed by 17 law professors published in the London Times. See Kur and Dreier, ibid., 264. Criticising the discrepancy in treatment of performers and phonogram producers, see Van Eechoud, et al., note 16, 60–61. Despite the differences between the film industry and the music sector, the lack of extension of the new rule for film producers does not seem justified. It creates difficulties where the same performance is recorded both on a phonogram and audiovisual media. Consequently, Directive 2011/77/EU has created different regimes for musical performers and audiovisual performers and for phonogram producers and film producers. It is difficult to find the reason why Recital 5 of Directive 2011/77/UE does not refer both to musical performers and audiovisual performers. This recital states: Performers generally start their careers young and the current term of protection of 50 years applicable to fixations of performances often does not protect their performances for their entire lifetime. Therefore, some performers face an income gap at the end of their lifetime. In addition, performers are often unable to rely on their rights to prevent or restrict an objectionable use of their performances that may occur during their lifetime. See A. González Gozalo, ‘La ampliación del plazo de protección de los fonogramas y de las interpretaciones y ejecuciones fijadas en los mismos’, in R. Bercovitz Rodríguez-Cano (ed.) La reforma de la Ley de Propiedad Intelectual, Tirant Lo Blanch, Valencia, 2015, 2125; and A. Ramalho and A. López-Tarruella, Implementation of the Directive 2011/77/EU: copyright term of protection, Study requested by the European Parliament’s Committee on Legal Affairs, 2018, 49.

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ARTICLE 3 (AS MODIFIED BY DIRECTIVE 2011/77/EU): DURATION OF RELATED RIGHTS

Regarding film producers, the traditional special rule that grants a longer protection when the film is lawfully published or lawfully communicated to the public within this period of 50 years from the fixation is still in force, which means that the term of protection starts to run from the date of the publication or communication of the film to the public, whichever is the earlier.49 It has to be taken into account that the Berne Convention, the TRIPS Agreement and the WIPO 8.41 Treaties of 1996 did not regulate a separate specific right for film producers. As it was said above, film producers were granted a related right under Article 12 of the EU Rental and Lending Directive 1992 for a basic period of 20 years. This provision was repealed by the Term Directive as codified in 2006, which provides a term of protection of 50 years after the year of the fixation or 50 years from the year of the first lawful publication or communication to the public. For broadcasting organisations, the term of protection of 50 years runs always from the first 8.42 transmission of the broadcast. The way it is transmitted – whether by wire or over the air, including by cable and satellite – is not decisive. The transmission has to be the first, since repeated transmissions of that broadcast do not re-start the running of the term of protection.50 Under Article 12 of the EU Rental and Lending Directive 1992 broadcasters were granted a minimum period of protection of 20 years, following the rule contained within Article 14 of the Rome Convention. This period was also regulated in Article 14(5) of the TRIPS Agreement. However, Article 3(4) of the Term Directive established a period of protection for broadcasters’ related right of 50 years from the first transmission of the broadcast. Finally, it must be pointed out that the list of related rights regulated in Article 3 of the Term 8.43 Directive is not an exhaustive one, but a numerus apertus enumeration, which means that Member States are allowed to grant further related rights to other persons.51 This consideration is confirmed by the next two Articles of this Directive, with respect to critical and scientific publications and photographs. Some other European Directives have followed this non-exhaustive nature, since the European legislature has granted related protection to other subject matter differing from works, e.g. the sui generis right over databases, with a 15-year term protection, calculated from the date of completion or, if the database is made available to the public within this period, from the date of publication (Art. 10(1) and (2) of the Database Directive).52

49 50

On the double protection by related rights and by copyright of audiovisual works, see Kamina, note 40, 95–7. Recital 18 of the codified version expressly states: The rights of broadcasting organisations in their broadcasts, whether these broadcasts are transmitted by wire or over the air, including by cable or satellite, should not be perpetual. It is therefore necessary to have the term of protection running from the first transmission of a particular broadcast only. This provision is understood to avoid a new term running in cases where a broadcast is identical to a previous one.

51

See V. L. Benabou, Droits d’auteur, droit voisins et droits communautaires, Bruylant, Brussels, 1997, 377; and Walter and Von Lewinski, note 19, 566–7. This idea is expressed in Recital 19 of the codified version, which states: The Member States should remain free to maintain or introduce other rights related to copyright in particular in relation to the protection of critical and scientific publications. In order to ensure transparency at Community level, it is however necessary for Member States which introduce new related rights to notify the Commission.

52

On copyright and sui generis protection granted by Directive 96/9/EC, see E. Derclaye, The Legal Protection of Databases. A Comparative Analysis, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2008, 43 ff; G. Minero Alejandre, ‘Protección jurídica de las bases de datos: Estudio de la aplicación de la Directiva 96/9/CE tres lustros después de su aprobación y comentario a la primera evaluación realizada por la Comisión europea en 2005’ (2011) 37 Revista de Propiedad Intelectual Pe.i., 13 ff; and I. Stamatoudi, ‘Les bases de données dans la directive communautaire’ (1997) 171 RIDA, 78 ff.

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Chapter 8 THE TERM DIRECTIVE

II. SPECIFIC RULES FOR PERFORMERS AND PRODUCERS OF PHONOGRAMS. AMENDMENTS INTRODUCED BY DIRECTIVE 2011/77/EU 8.44 The purpose of this new Directive is to strengthen the position of performers, both extending the term of protection and guaranteeing remuneration over a longer period of time.53 Therefore some changes are introduced into two areas: the duration of rights of the performers when their performances are fixed in phonograms and the duration of the rights of phonogram producers. Besides, Directive 2011/77/EU regulates some consequences that the extended protection may have in contracts between performers and producers, as well as regarding rights acquired by third parties. 8.45 As for the term of protection for performers: (i) the general rule of 50 years after the date of the performance is maintained (Art. 3(1) first sentence of the Term Directive, as amended by Directive 2011/77/EU); (ii) the first exception to this basic rule is also maintained, which means that if a fixation of the performance is lawfully published or lawfully communicated to the public within this period, the rights shall expire 50 years from the date of the first such publication or the first such communication to the public, whichever is the earlier. However, the application of this rule is now limited only to the case in which the fixation of the performance is made otherwise than in a phonogram (Art. 3(1) second sentence of the Term Directive, as amended by Directive 2011/77/ EU); and (iii) in addition, a new exception to the general rule – or a new interpretation to the previous exception – is provided: if the performance is fixed in a phonogram and is lawfully published or lawfully communicated to the public within this period of 50 years after the fixation, the rights shall not expire in 50 years, but in 70 years from the date of the first such publication or the first such communication to the public, whichever is the earlier (Art. 3(1) third sentence of the Term Directive, as amended by Directive 2011/77/EU).54 The substitution of 70 years for 50 years that was effected by Directive 2011/77/EU applies to fixations of the performances in phonograms whose protection was still in force on 1 November 2013 and which come into being afterwards. The same new rule applies to phonograms: the producer is protected for a period of 50 years after the fixation but, if the phonogram has been lawfully published or lawfully communicated to the public during this period, the term is extended to 70 years from the date of such lawful publication or communication, whichever is the earlier. 8.46 The existence of a phonogram is, thus, the dividing line between one exception to the general rule – and its term of protection – and the other. Due to the relevance of this issue, it seems surprising that the understanding of the term ‘phonogram’ is not defined in the Term Directive. Taking into

53

Recital 6 of Directive 2011/77/EU states: The revenue derived from the exclusive rights of reproduction and making available, as provided for in Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonization of certain aspects of copyright and related rights in the information society, as well as fair compensation for reproductions for private use within the meaning of that Directive, and from the exclusive rights of distribution and rental within the meaning of Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, should be available to performers for at least their lifetime.

54

For an overview, see K. Garnett, G. Davies, G. Harbottle, W. A. Copinger and E. P. Skones James, Copinger and Skone James on Copyright, 16th ed., Sweet & Maxwell, London, 2011, Supplement to the 16th ed. chapter six. On a critical view of the actual result of this Directive regarding incentives to artists and record producers, see B. Farrand, ‘Too Much Is Never Enough? The 2011 Copyright in Sound Recordings Extension Directive’ (2012) 34 EIPR 297–304. The Commission’s initial proposal provided an extension to 95 years from the triggering event. However, the new term of protection of 70 years was defined by the European Parliament (European Parliament Legislative Resolution of 23 April 2009 on the Proposal for a Directive of the European Parliament and the Council amending Directive 2006/116/EC of the European Parliament and of the Council on the Term of Protection of Copyright and Related Rights, COM(2008) 406). See C. Angelopoulos, ‘Amended Directive Extends the Term of Protection for Performers and Sound Recordings’ (2011) 11 GRUR International, 987.

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ARTICLE 3 (AS MODIFIED BY DIRECTIVE 2011/77/EU): DURATION OF RELATED RIGHTS

account Article 3(b) of the Rome Convention, Article I(a) of the Geneva Phonogram Convention and Article 2(b) of the WPPT, it must be understood as any fixation of the sound of a performance, other than in a cinematographic or an audiovisual work.55 This amendment creates a division between, on the one hand, performers of musical works or sound 8.47 fixed in a phonogram (whose term of protection may be 70 years from the date of the first publication or the first communication to the public of the phonogram where their performance was fixed) and, on the other hand, those other performers whose performances are fixed otherwise than in a phonogram and performers of works of non-musical nature, such as movies. For the latter, the term of protection continues to be 50 years after the date of the performance or 50 years from the date of the first publication or the first communication to the public, whichever is the earlier. Taking into account these considerations, the European legislature expressly foresees the possibility of extending the term of protection of rights to performers and producers in the audiovisual sector, once the impact of Directive 2011/77EU has been assessed.56 Regarding the term of protection of producers of phonograms: (i) the general rule of 50 years after 8.48 the date of the fixation is maintained (Art. 3(2) first sentence of the Term Directive, as amended by Directive 2011/77/EU); and (ii) the first and second exceptions to this basic rule are also maintained, but the term of protection is extended to 70 years in both cases (Art. 3(2) second and third sentences). In addition, Directive 2011/77/EU introduces a set of accompanying measures to increase the 8.49 control of performers over their works. First, new Article 2(a) provides for a ‘use it or lose it’ clause, which means that if the phonogram producer does not market a recording of the performance despite the performer’s request, the performer may terminate the contract by which that performer transferred or assigned his rights in the fixation of his performance to a phonogram producer, get the rights back and market that recording himself, because the rights of the producer expire.57 The right to terminate the contract on transfer may be exercised if the producer, within a year from the notification by the performer of his intention to terminate the contract, fails to offer copies of the phonogram for sale in sufficient quantity or does not make it available to the public. This right to terminate may not be waived by the performer. Therefore, producers can no longer lock up phonograms that they do not find commercially interesting.58

55 56

See A. Bourkaib Fernández De Córdoba, ‘Algunas reflexiones a propósito de la Directiva 2011/77/UE’ (2012) 31 Actualidad Jurídica Uría Menéndez, 90, 91–2. Art. 3(2) of Directive 2011/77EU states: By 1 January 2012, the Commission shall submit a report to the European Parliament, the Council and the European Economic and Social Committee, assessing the possible need for an extension of the term of protection of rights to performers and producers in the audiovisual sector. If appropriate, the Commission shall submit a proposal for the further amendment of Directive 2006/116/EC.

57

This possibility has not yet been implemented. A ‘use it or lose it’ provision was already in force in Germany (Arts 41 and 79(2) of the German Copyright Act). This was taken into account by the European legislature. See Commission Staff Working Document accompanying the Proposal for a Council Directive amending Council Directive 2006/116/EC as regards the term of protection of copyright and related rights, Impact Assessment on the Legal and Economic Situation of Performers and Record Producers in the European Union, (COM(2008) 464 final), Brussels 16.7.2008, 26. Recital 8 of Directive 2011/77/EU establishes: The rights of the phonogram producer in the phonogram should therefore expire, in order to avoid a situation in which these rights would coexist with those of the performer in the fixation of the performance while the latter rights are no longer transferred or assigned to the phonogram producer.

58

For an overview, see Angelopoulos, 2011, note 54, 987.

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Chapter 8 THE TERM DIRECTIVE

8.50 Besides, Directive 2011/77/EU creates an unwaivable right to supplementary remuneration or a 20 per cent fund in Articles 3(2) (b), (c) and (d).59 This remuneration, which is administered by collecting societies (Art. 3(2)(d) of Term Directive, as amended by Directive 2011/77/EU), ensures that performers who are forced to transfer their rights for a non-recurring remuneration obtain additional payments during the extended term. This fund is to be paid by the phonogram producers to whom the performer transferred his rights (Art. 3(2)(b) of Term Directive, as amended). It shall correspond to 20 per cent of the revenue, which the phonogram producer has derived during the year preceding that for which the said remuneration is paid, from the reproduction, distribution and making available of the phonogram in question, and it only applies to those phonograms, which benefit from the term extension (Art. 3(2)(c) of Term Directive, as amended).60 8.51 Finally, Directive 2011/77/EU provides for a ‘clean slate’ provision. New Article 2(e) means that producers are not entitled to make any deduction from the contractual royalties due to performers during the extended term.61 The purpose is to allow performers to receive full royalties for the extended period of protection, regardless of the pre-existing contractual arrangements.62 Thus, it prevents producers from making deductions from the royalties due to performers once the initial 50-year term is over.

NOTES 1. Related instruments Proposal for a European Parliament and Council Directive amending Directive 2006/116/EC of the European Parliament and of the Council on the term of protection of copyright and certain related rights, COM(2008) 464/3. Article 1 Dir. 2011/77 amending Dir. 2006/116/EC. Commission Staff Working Document accompanying the Proposal for a Council Directive amending Council Directive 2006/116/EC as regards the term of protection of copyright and related rights, Impact Assessment on the Legal and Economic Situation of Performers and Record Producers in the European Union, COM(2008) 464 final. European Parliament Legislative Resolution of 23 April 2009 on the Proposal for a Directive of the European Parliament and the Council amending Directive 2006/116/EC of the European Parliament and of the Council on the Term of Protection of Copyright and Related Rights, COM(2008) 406. Article 12 Dir. 2006/115 on rental right and lending right. Article 11(2) Dir. 2001/29 on information society. Article 10 Dir. 96/9 on databases. Article 18 WPPT. Article 15(5) TRIPs Agreement. Article 14 Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organizations. Article 4 Geneva Convention for the Protection of Producers and Phonograms against Unauthorized Duplication of their Phonograms.

59 60

61

62

See Recitals 9–12 of Directive 2011/77/EU. According to Recital 12 of Directive 2011/77/EU, Member States may regulate the extent to which micro-enterprises are subject to the obligation to contribute where such payments would appear unreasonable in relation to the costs of collecting and administering such revenue. Some other policy options were considered by the European legislature, such as recognising the moral right of performers but to a lesser extent than Member States recognise the rights of authors or extending the term of protection to the entire life of the performer. See Commission Staff Working Document accompanying the Proposal for a Council Directive amending Council Directive 2006/116/EC as regards the term of protection of copyright and related rights, Impact Assessment on the Legal and Economic Situation of Performers and Record Producers in the European Union (COM(2008) 464 final), Brussels 16.7.2008, 24–26. See T. Cook, EU Intellectual Property Law, OUP, Oxford, 2010, 90–91. See Recitals 13–14 of Directive 2011/77/EU.

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ARTICLE 4: PROTECTION OF PREVIOUSLY UNPUBLISHED WORKS

2. Bibliography Angelopoulos, C., ‘Amended Directive Extends the Term of Protection for Performers and Sound Recordings’ (2011) 11 GRUR International, 987. Benabou, V. L., Droits d’auteur, droit voisins et droits communautaires, Bruylant, Brussels, 1997. Bourkaib Fernández De Córdoba, A., ‘Algunas reflexiones a propósito de la Directiva 2011/77/UE’ (2012) 31 Actualidad Jurídica Uría Menéndez, 90. Cook, T., EU Intellectual Property Law, OUP, Oxford, 2010. Derclaye, E., The Legal Protection of Databases. A Comparative Analysis, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2008. Farrand, B., ‘Too Much Is Never Enough? The 2011 Copyright in Sound Recordings Extension Directive’ (2012) 34 EIPR 297. Garnett, K., G. Davies, G. Harbottle, W. A. Copinger and E. P. Skone James, Copinger and Skone James on Copyright, 16th ed., Sweet & Maxwell, London, 2011. González Gozalo, A., ‘La ampliación del plazo de protección de los fonogramas y de las interpretaciones y ejecuciones fijadas en los mismos’, in R. Bercovitz Rodríguez-Cano (ed.) La reforma de la Ley de Propiedad Intelectual, Tirant Lo Blanch, Valencia, 2015, 21. Kamina, P., ‘Subject-Matter for Film Protection in Europe’, in E. Derclaye (ed.), Research Handbook on the Future of the EU Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009, 77. Kur, A. and T. Dreier, European Intellectual Property Law. Text, Cases and Materials, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2013. Latreille, A., ‘From Idea to Fixation: A View of Protected Works’, in E. Derclaye (ed.), Research Handbook on the Future of the EU Copyright, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2009, 133. Minero Alejandre, G., ‘Protección jurídica de las bases de datos: Estudio de la aplicación de la Directiva 96/9/CE tres lustros después de su aprobación y comentario a la primera evaluación realizada por la Comisión europea en 2005’ (2011) 37 Revista de Propiedad Intelectual Pe.i., 13. Ramalho, A. and A. López-Tarruella, Implementation of the Directive 2011/77/EU: copyright term of protection, Study requested by the European Parliament’s Committee on Legal Affairs, 2018. Stamatoudi, I., ‘Les bases de données dans la directive communautaire’ (1997) 171 RIDA 78. Sterling, J. A. L., World Copyright Law, 3rd ed., Sweet & Maxwell, London, 2008. See also Bibliography in Art. 1.

CHAPTER IV SPECIAL RULES FOR UNPUBLISHED WORKS ARTICLE 4: PROTECTION OF PREVIOUSLY UNPUBLISHED WORKS Any person who, after the expiry of copyright protection, for the first time lawfully publishes or lawfully communicates to the public a previously unpublished work, shall benefit from a protection equivalent to the economic rights of the author. The term of protection of such rights shall be 25 years from the time when the work was first lawfully published or lawfully communicated to the public.

I. COMMENTS This right is not an extension of the regular term of protection of the copyrighted posthumous 8.52 work, since its beneficiary is not the author’s heir or successor, but the publisher of a previously unpublished posthumous work. This special protection is an incentive to reward the necessary efforts made when publishing or making available to the public this kind of works. Contrary to Article 5, which also refers to publishers but is optional, this provision is mandatory for the Member States.

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Chapter 8 THE TERM DIRECTIVE

8.53 The protection provided in this Article only covers the publication or the communication to the public of posthumous works, provided that publication or communication takes place after the expiry of copyright in that work. Therefore, there are five requirements: (i) (ii) (iii) (iv) (v)

the work published or communicated to the public must be posthumous; the publication or communication to the public must take place after the expiry of the term of protection, so it must be in the public domain;63 it must be the first publication or communication to the public of that work after the author’s death;64 the communication or publication must be lawful;65 and it can take place by any means, in European territory or abroad. Provided these conditions are fulfilled, the publisher benefits from a protection equivalent to the economic rights of the author for a period of 25 years from the date of the first lawful publication or communication, whichever act occurs first.66

No moral rights are provided to the publisher.

NOTES 1. Bibliography See Bibliography in Art. 1.

CHAPTER V REMARKS ON (NATIONAL) PROTECTION OF CRITICAL AND SCIENTIFIC PUBLICATIONS ARTICLE 5: CRITICAL AND SCIENTIFIC PUBLICATIONS Member States may protect critical and scientific publications of works which have come into the public domain. The maximum term of protection of such rights shall be 30 years from the time when the publication was first lawfully published.

I. COMMENTS 8.54 As opposed to Article 4 of the Term Directive, the works referred to in Article 5 do not have to be posthumous, although they must already be in the public domain. The edition must have a scientific 63

64

65

66

Therefore, the publication or communication to the public of a posthumous work whose protection has not expired will be relevant when applying Art. 1(1) of the Term Directive – on deciding whether that publication or communication took place in the period of 70 years pma – but will not be protected under Art. 4 of this Directive. See Benabou, note 50, 392. On the contrary, stating that it is not decisive whether the work was previously communicated to the public, but only the fact that the work was not previously published, see Walter and Von Lewinski, note 19, 572. In the IP context, the term ‘lawfully’ generally means with the author’s consent. However, since within the meaning of Art. 4 of the Term Directive the work must be already in the public domain, this term cannot be understood in the sense of requiring the consent of the author or the author’s successors. Therefore, it must refer to the lack of infringement of moral rights existing in that posthumous work of public domain. See Benabou, ibid., 378; and Walter and Von Lewinski, ibid., 575. On criticising the lack of harmonisation of the initial ownership of this related right, see Van Eechoud, et al., note 16, 64–5.

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ARTICLE 6: PROTECTION OF PHOTOGRAPHS

or critical basis or character, although the individual works that are published do not have to be critical or scientific as such.67 The related rights protection of this kind of edition is not mandatory. As opposed to Article 4 of the 8.55 Term Directive, this Article 5 left it up to the Member States to decide whether or not to provide this protection and the duration of it.68 However, such national protection may, in no case, exceed the term of 30 years from publication.69 In order to ensure transparency, Article 11(1) of the Term Directive requires those Member States which introduce new related rights to notify the European Commission of such national regulation.

NOTES 1. Bibliography See Bibliography in Art. 1.

CHAPTER VI SPECIAL RULES FOR PHOTOGRAPHS ARTICLE 6: PROTECTION OF PHOTOGRAPHS Photographs which are original in the sense that they are the author’s own intellectual creation shall be protected in accordance with Article 1. No other criteria shall be applied to determine their eligibility for protection. Member States may provide for the protection of other photographs.

I. COMMENTS The protection of photographic works has always been a controversial issue. Although works of 8.56 photography are listed in the catalogue of copyrightable works set out in Article 2 of the Berne Convention, Article 7(4) of this international Convention discriminates against this kind of works by providing a minimum term of 25 years calculated from the creation date, whereas for the rest of the works the general rule is life of the author plus 50 years pma.70 Thus, there have been problems of overlap in the concepts of protection of photographs. However, Article 9 of the WCT clearly prohibits parties to that Treaty from applying Article 7(4) of the Berne Convention, thus making the general rule: author’s life plus 50 years, the minimum term for WCT members.71 As a result, before the Directive was enacted protection of photography in the EU Member States’ laws varied significantly.72

67 68

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However, it is common that both the work or works and the edition have this character. Recital 19 of the codified version emphasises this non-mandatory nature: ‘The Member States should remain free to maintain or introduce other rights related to copyright in particular in relation to the protection of critical and scientific publications.’ See Angelopoulos, 2012, note 31, 583; and Gaubiac, Linder and Adams, note 7, 172–3. Any other shorter term is admitted. For example, Italy has instituted this right under its national law, with a term of protection of 20 years after the first lawful publication by any means. The Berne Convention has done little to introduce uniformity into the national terms of copyright for photographs. See, Goldstein and Hugenholtz, note 2, 290; and S. Ricketson, The Berne Convention for the Protection of Literary and Artistic Works: 1886–1986, Kluwer, Deventer, 1987, 338. See Ricketson and Ginsburg, note 5, 563, 576–7. Recital 16 of the codified version of the Term Directive. Some national legislations provided only for a related right protection, whereas some others only protected original photographs by copyright. For an overview, see Y. Gendreau,

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8.57 The European legislature made no use of the possibility contained in Article 7(4) of the Berne Convention. It decided to consider that photographic works are copyrightable works, provided they are original in the sense that they are the author’s own intellectual creation.73 Thus, consistently, photographic works are granted the full harmonised term of protection for copyrightable works contained within Article 1 of the Term Directive: author’s life plus 70 years pma. Consequently, in Article 6, the Directive deals specifically with a matter related directly to the term of protection as such, but with subsistence of originality in photographs. No criteria other rather than originality shall be applied to determine their eligibility for protection by copyright. Besides, this provision permits Member States to provide for the protection of ‘other photographs’, that is, photographs that do not fulfil the originality test. 8.58 However, this provision is partially non-mandatory. Member States are free to decide whether to provide a related right for non-original photos. A photograph that fulfils the originality conditions defined in Article 6 of the Term Directive must be necessarily protected by copyright under national legislation. On the other hand, it is left entirely to the Member States’ discretion to protect other photographs, which do not fulfil the originality requirements, by related rights with their own term of protection, on conditions other than originality as set out in this provision.74 The European norm is silent on the duration of such a right. Therefore, Member States that have decided to institute this related right differ on the term of protection.75 When a Member State decides to make use of this possibility, notification duties provided in Article 11(1) of the Term Directive must be obeyed.76 8.59 On defining the level of originality, the Term Directive followed the one already provided in Article 1(3) of the Computer Program Directive.77 According to Article 6 and Recital 16 of the codified version of the Term Directive, a photographic work is original ‘if it is the author’s own intellectual creation reflecting his personality’. Afterwards, this Recital stresses that ‘no other criteria such as merit or purpose are to be taken into account’.78 The decision as to whether there has been a sufficient amount of personal creativity input depends on the context of the photograph.79 This is the case if the author was able to express his creative abilities in the production of the work by

73

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A. Nordemann and R. Oesch, Copyright and Photographs: An International Survey, Kluwer Law International, London, 1999; and Walter and Von Lewinski, note 19, 585. The same originality test is applied to computer programs under Art. 1(3) of the Computer Program Directive and for databases under Art. 3(1) of the Database Directive. Recital 16 of the Term Directive imposes a further requirement in the definition of originality in photographs, when highlighting ‘a photographic work within the meaning of the Berne Convention is to be considered original if it is the author’s own intellectual creation reflecting his personality, no other criteria such as merit or purpose being taken into account’. See Gaubiac, Linder and Adams, note 7, 166–8, 179–80. E.g., Italy and Spain, which protect non-original photographs by a related right for 20 years and 25 years after the creation date, respectively (Art. 92 of the Italian Copyright Act and Art. 128 of the Spanish Copyright Act). The German rule contained within Art. 72 of the German Copyright Act is more complex. The German related right on the non-original photos expires 50 years after the first publication or after the first communication to the public where such communication took place at an earlier date. If the picture is not published or is not lawfully communicated to the public within that period of 50 years after the manufacture or production of the photograph, then the protection ends. As long as the work is published at least once in that period, the period of protection is extended until 50 years after the date of its first publication. See commentary to Art. 11 of the Term Directive. This criterion is also used in Art. 3(1) and Recital 16 of the Database Directive. It is defined as a compromise achieved between the British and Irish legal tradition, which only required that a work is not a copy of a previous one, on the one hand, and, on the other hand, the approach that has been followed by the civil law countries, which required some creativity. See Benabou, note 50, 383 ff; and Walter and Von Lewinski, note 19, 587. See Walter and Von Lewinski, ibid., 586–7. See Tritton, note 6, 519. See Case C-145/10, Eva-Maria Painer v. Standard VerlagsGmbH [2011], para. 88.

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ARTICLE 7: PROTECTION VIS-À-VIS THIRD COUNTRIES

making free and creative choices.80 As regards portrait photography, the ECJ remarked that the photographer can make free and creative choices in several ways and at various points in its production and, thus, stamp the work created with his ‘personal touch’: (i) in the preparation phase, the photographer can choose the background, the subject’s pose and the lighting; (ii) when taking the photograph, he can choose the framing, the angle of view and the atmosphere created; and (iii) when selecting the snapshot, the photographer may choose from a variety of developing techniques the one he wishes to adopt or, where appropriate, the use of computer programs.81

NOTES 1. Related instruments Article 1 Dir. 91/250 on computer programs. Article 9 WCT. Articles 2 and 7 Berne Convention for the Protection of Literary and Artistic Works. Article 3 of Dir. 96/9 on databases.

2. CJEU case law Case C-683/17, Cofemel v. G-Star Raw CV [2019]. Case C-161/17, Land Nordrhein-Westfalen v. Dirk Renckhoff [2018]. Case C-604/10, Football Dataco Ltd. v. Yahoo! UK Ltd. [2012]. Case C-145/10, Eva-Maria Painer v. Standard VerlagsGmbH [2011]. Cases C-403/08 and C-429/08 Football Association Premier League and Others [2011] ECR I-0000.

3. Bibliography Gendreau, Y., A. Nordemann and R. Oesch, Copyright and Photographs: An International Survey, Kluwer Law International, London, 1999. See also Bibliography in Art. 1.

CHAPTER VII TREATMENT OF ALIENS ARTICLE 7: PROTECTION VIS-À-VIS THIRD COUNTRIES 1.

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Where the country of origin of a work, within the meaning of the Berne Convention, is a third country, and the author of the work is not a Community national, the term of protection granted by the Member States shall expire on the date of expiry of the protection granted in the country of origin of the work, but may not exceed the term laid down in Article 1.

See Joined Cases C-403/08 and C-429/08 Football Association Premier League and Others [2011] ECR I-0000, para. 98; Case C-145/10, Eva-Maria Painer v. Standard VerlagsGmbH [2011], para. 89; and Case C-161/17, Land NordrheinWestfalen v. Dirk Renckhoff [2018], para. 14. This requirement is also contained in some recent judgments in relation to works other than original photographs. See, among others, Case C-604/10, Football Dataco Ltd. v. Yahoo! UK Ltd. [2012], on databases, where it was concluded that the originality criterion is not satisfied when the setting up of the database is dictated by technical considerations, rules or constraints which leave no room for creative freedom (para. 39). In relation to clothing, see Case C-683/17, Cofemel v. G-Star Raw CV [2019] (para. 30). Case C-145/10, Eva-Maria Painer v. Standard VerlagsGmbH [2011], paras 90–92.

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2.

3.

The terms of protection laid down in Article 3 shall also apply in the case of rightholders who are not Community nationals, provided Member States grant them protection. However, without prejudice to the international obligations of the Member States, the term of protection granted by Member States shall expire no later than the date of expiry of the protection granted in the country of which the rightholder is a national and may not exceed the term laid down in Article 3. Member States which, on 29 October 1993, in particular pursuant to their international obligations, granted a longer term of protection than that which would result from the provisions of paragraphs 1 and 2 may maintain this protection until the conclusion of international agreements on the term of protection of copyright or related rights.

I. COMMENTS 8.60 From the wording of this provision and of Recitals 21 and 22 we can infer that it is a mandatory rule,82 which requires Member States to apply the comparison of term rule for works whose country of origin, within the meaning of the Berne Convention,83 is a third country and for rightholders who are not Community nationals who qualify for protection under an international agreement.84 Thus, it obliges Member States to apply the reciprocity treatment. The purpose of this reciprocity rule is to incentivise third countries to adapt their legislation to the European term of protection standard. 8.61 In both cases, the protection of copyright and the related rights follow the same double rule: the term of protection granted by Member States shall expire no later than the date of expiry of the protection granted in the country of origin or the country of which the rightholder is a national and this period must not exceed the term laid down in the Directive, that is, in Articles 1 and 3. 8.62 However, Article 7(2) second sentence of the Term Directive states that this rule, at least regarding related rights, cannot prejudice the international obligations of the Member States.85 Recital 23 states that ‘comparison of terms should not result in Member States being brought into conflict with their international obligations’. When the international agreement standardises a lower level of protection than in the Term Directive, no problem arises, providing that the national treatment granted in the international agreement is understood as referring only to the minimum rights – and the minimum term of protection – granted under the international agreement. However, if it is considered that the national treatment principle contained in a particular international treaty is to be understood in a narrow sense it should be admitted that rightholders from third countries may claim the entire 50-year term of protection as harmonised by the Term Directive.86

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According to Recital 21 of the Term Directive: For works whose country of origin within the meaning of the Berne Convention is a third country and whose author is not a Community national, comparison of terms of protection should be applied, provided that the term accorded in the Community does not exceed the term laid down in this Directive. Besides, Recital 22 states: Where a rightholder who is not a Community national qualifies for protection under an international agreement, the term of protection of related rights should be the same as that laid down in this Directive. However, this term should not exceed that fixed in the third country of which the rightholder is a national.

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According to Art. 5(4) of the Berne Convention, the publication country is the country of origin of a work. Case C-240/07, Sony Music Entertainment GmbH v. Falcon Neue Medien Vertrieb GmbH, [2009] ECR I-00263, para. 33, on copyright-related rights. Because of its general wording, this rule applies to any international agreement concluded by a Member State before or after the Directive’s enactment. For an overview on the national treatment principle discussion, see Walter and Von Lewinski, note 19, 597–8 and 602–7.

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Finally, Article 7(3) states that it is a matter for the respective Member State to decide whether or 8.63 not to maintain longer terms of protection for both copyright and related rights, which Member States granted on 29 October 1993, in particular pursuant to their international obligations, but also including longer terms provided by domestic law, bilateral and multilateral agreements.

NOTES 1. Related instruments Article 5 Berne Convention for the Protection of Literary and Artistic Works.

2. CJEU case law Case C-240/07, Sony Music Entertainment GmbH v. Falcon Neue Medien Vertrieb GmbH, [2009] ECR I-00263.

3. Bibliography See Bibliography in Art. 1.

CHAPTER VIII RULES FOR CALCULATING TERMS OF PROTECTION ARTICLE 8: CALCULATION OF TERMS The terms laid down in this Directive shall be calculated from the first day of January of the year following the event which gives rise to them.

I. COMMENTS All terms of protection provided for by the Directive should be calculated from the first day of 8.64 January of the year following the relevant event, although the protection starts running from the date of that triggering event.87 Therefore, the terms of protection are to be calculated in full calendar years, so the end of every copyright and related right is always 31 December.88 This provision follows the European legislature’s concern to standardise not only the terms of 8.65 protection as such, but also the date from which each term of protection is calculated. In order to fulfil this requirement, regulating uniform relevant events that set off the term of protection would not be enough. However, this provision is not actually necessary, at least regarding copyright, since this rule of calculation was already contained in Article 7(5) of the Berne Convention and, therefore, was binding for EU Member States at the time the Directive was enacted.

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Recital 15 of the Directive. The Term Directive followed the rule regulated in the Berne and Rome Conventions. As Walter and Von Lewinski, note 19, 608, state: ‘The terms of protection are to be calculated not de momento ad momentum.’

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NOTES 1. Related instruments Article 7 Berne Convention for the Protection of Literary and Artistic Works.

2. Bibliography See Bibliography in Art. 1.

CHAPTER IX REMARKS ON MORAL RIGHTS ARTICLE 9: MORAL RIGHTS This Directive shall be without prejudice to the provisions of the Member States regulating moral rights.

I. COMMENTS 8.66 European Directives in the area of copyright and related rights, including those enacted prior to and subsequent to the Term Directive, do not deal with questions of moral rights at all, neither related to copyright nor regarding neighbouring rights.89 Since all Member States of the EU are contracting countries of the Berne Convention, Article 6bis(2) of this international agreement applies to European copyright. According to this provision, moral rights – that is to say, right of paternity and right of integrity, which are the only two moral rights provided by this international treaty – shall, after the author’s death, be maintained at least until the expiry of the economic rights. The Berne Convention gives freedom to national legislatures to provide a term of protection of moral rights exceeding the term for economic rights. Besides, it includes the possibility to regulate further moral rights, in order to provide a broader protection to authors. However, it has to be stated that the Term Directive affects the term of protection of moral rights indirectly. Thus because in many Member States the term of protection of moral rights is the same as that of the economic rights, so that where the term of the economic rights is extended by the Term Directive (in comparison with the Berne Convention) this will automatically increase the term of protection of moral rights. 8.67 Consequently, national protection of moral rights differs widely among EU Member States, both in the number of moral rights and in its term of protection. Many countries have extended to moral rights the limited period of protection of economic rights – common law jurisdictions and Germany, among others90 – whereas some national legislatures have made use of the possibility to provide for everlasting protection of moral rights. For example, in France, moral rights are perpetual.91 In Spain92 and in Greece,93 only the right of integrity and the right of paternity are everlasting.

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Recital 20 of the codified version of the Term Directive states: ‘It should be made clear that this Directive does not apply to moral rights.’ s. 86 of the British Act 1988; Arts 11 and 64 of the German Act. Art. L112-3 of the French Act. Art. 15 of the Spanish Act. Art. 29(2) of the Greek Act. See also I. Stamatoudi, ‘The term of protection Directive’, Volume in honour of A. Georgiades, Ant. N. Sakkoulas, Athens, 2005, at 823; I. Stamatoudi and G. Koumantos, Greek Copyright Law,

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ARTICLE 10: APPLICATION IN TIME

NOTES 1. Related instruments Article 6bis(2) Berne Convention for the Protection of Literary and Artistic Works.

2. Bibliography Stamatoudi, I., ‘The Term of Protection Directive’, Volume in honour of A. Georgiades, Ant. N. Sakkoulas, Athens, 2005. Stamatoudi, I. and L. Kotsiris, Commentary on the Greek Copyright Act, Sakkoulas Publications, Athens – Thessaloniki, 2009. Stamatoudi, I. and G. Koumantos, Greek Copyright Law, P. Sakkoulas, Athens, 2014. See also Bibliography in Art. 1.

CHAPTER X EFFECTS OF THE DIRECTIVE ON RUNNING TERMS AND OTHER RULES OF APPLICATION IN TIME ARTICLE 10: APPLICATION IN TIME 1.

Where a term of protection which is longer than the corresponding term provided for by this Directive was already running in a Member State on 1 July 1995, this Directive shall not have the effect of shortening that term of protection in that Member State. 2. The terms of protection provided for in this Directive shall apply to all works and subject matter which were protected in at least one Member State on the date referred to in paragraph 1, pursuant to national provisions on copyright or related rights, or which meet the criteria for protection under Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property. 3. This Directive shall be without prejudice to any acts of exploitation performed before the date referred to in paragraph 1. Member States shall adopt the necessary provisions to protect in particular acquired rights of third parties. 4. Member States need not apply the provisions of Article 2(1) to cinematographic or audiovisual works created before 1 July 1994. 5. Article 3(1) to (2e) in the version thereof in force on 31 October 2011 shall apply to fixations of performances and phonograms in regard to which the performer and the phonogram producer are still protected, by virtue of those provisions in the version thereof in force on 30 October 2011, as at 1 November 2013 and to fixations of performances and phonograms which come into being after that date. 6. Article 1(7) shall apply to musical compositions with words of which at least the musical composition or the lyrics are protected in at least one Member State on 1 November 2013, and to musical compositions with words which come into being after that date. The first subparagraph of this paragraph shall be without prejudice to any acts of exploitation performed before 1 November 2013. Member States shall adopt the necessary provisions to protect, in particular, acquired rights of third parties.

P. Sakkoulas, Athens, 2014; I. Stamatoudi and L. Kotsiris, Commentary on the Greek Copyright Act, Sakkoulas Publications, Athens – Thessaloniki, 2009.

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COMMENTS I. LONGER TERMS OF PROTECTION OF COPYRIGHT OR RELATED RIGHTS ALREADY RUNNING IN A MEMBER STATE 8.68 As mentioned in the commentary to Article 1, when the Term Directive was enacted some longer terms of protection were in force in some Member States.94 Due regard for established or acquired rights is one of the general principles of EU law, Article 10(1) of the Term Directive declares that such longer terms must be maintained as duly acquired rights. In other words, the Term Directive has no effect of shortening the protection already enjoyed by rightholders in the EU and it prevents Member States from introducing transitional provisions that cut down the initial term of protection, reducing terms of protection to the level contained in the Term Directive.95 Therefore, any longer term already running in a Member State on 1 July 1995 – that is, on the deadline for the national implementation – will continue running until the expiry date under the corresponding national law.96

II. APPLICATION IN TIME OF THE DIRECTIVE 8.69 The European legislature had to deal with the problem arising from the fact that, on the date of the adoption of this Directive, some works were protected only in some EU Member States, but not in others. The harmonising aim was fulfilled by Article 10(2) of the Term Directive. Pursuant to this provision, the harmonised term of protection provided for in the Directive applies in all Member States, provided that the works and subject matters were protected in at least one Member State on 1 July 1995, pursuant to national provisions on copyright or related rights, or under the conditions of the Rental and Lending Rights Directive. In this case, the work came back into protection throughout the EU on that date. The Directive has effectively resulted in a large-scale revival of copyright in those EU countries that formerly granted a term of author’s life plus 50 years pma. However, the Directive does not designate the beneficiaries of the revival of copyright. National legislatures, thus, have dealt with this issue in different ways. Consequently, there is no real complete harmonisation on this issue.97 8.70 It is not required that the copyright or related right was running in every Member State, but only in one EU country. Therefore, where copyright in a work had expired in one or some Member States, it shall revive in every EU country – including those Member States which acceded to the EU in 2004 – if it was still protected in another Member State on 1 July 1995.98 This rule applies not only to works, but also to other subject matter, such as recordings, and the economic consequences are considerable, taking into account the monetary importance of many recordings that were made after 1945, e.g. the Beatles. 8.71 These considerations are not contrary to the interpretation made by the ECJ a few days prior to the adoption of this Directive in the Phil Collins case.99 The ECJ remarked that the general principle of non-discrimination laid down in Article 7 of the EEC Treaty is applicable to copyright and related

94 95 96 97 98 99

See commentary to Art. 1 of the Term Directive. For an overview of the problems created by this rule in the different Member States, see Angelopoulos, 2012, note 31, 578–9; Gaubiac, Linder and Adams, note 7, 149 ff; and Walter and Von Lewinski, note 19, 617. Recital 10 of the codified version of the Term Directive. See Goldstein and Hugenholtz, note 2, 300. See Case C-240/07, Sony Music Entertainment GmbH v. Falcon Neue Medien Vertrieb GmbH, [2009] ECR I-00263, para. 22. See M. Martín-Prat, ‘New Rules in European Copyright’ (1994) 4 EIPR 145; and Tritton, note 6, 520–21. Case C-92/92, Phil Collins v. Intrat Handelsgesellschaft mBH [1993] ECR I-05145.

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rights100 and this principle may be directly relied upon before a national court by an author or performer from another Member State, or by those claiming under them, in order to claim the benefits or protection reserved to national authors and performers.101 In conclusion, it can be understood that works created by nationals of Member States enjoy the term of protection of an author’s life plus 70 years pma, irrespective of whether or not their home countries had provided for a shorter term prior to the actual implementation of the Term Directive. That solution was adopted in order to achieve as rapidly as possible the objective of harmonising national laws governing the terms of protection of copyright and related rights and to avoid the situation where rights had expired in some Member States but were protected in others (Recital 2 of the Term Directive).102 Thus, according to EU law an advantage given by a Member State to one of its own nationals must also be available to the nationals of any other Member State. The introduction of the Term Directive created a degree of confusion for certain rightholders, who 8.72 sought to rely on it in order to revive copyright that was in the public domain prior to its entry into force on 1 July 1995. This issue was also discussed in case C-169/15, Montis Design BV v. Goossens Meubelen BV [2016]. The proceedings concerned two undertakings: Montis Design, which was the holder of rights in the design of a dining room chair and an armchair (called ‘Chaplin’ and ‘Charly’) and Goossens, which was the proprietor of furniture shops in the Netherlands, in which a chair model was marketed, being very similar to Montis’ designs. ‘Chaplin’ and ‘Charly’ had been registered as international designs in April 1988, and they were protected as such until April 1993. According to the facts, on that date, those works were not protected in any other Member State. Under the Dutch law in force at that time, a design was eligible for protection under both copyright and design laws, but the extinction of the design rights meant that the copyright also expired unless the rightholder of the design submitted a special declaration seeking to maintain his copyright. That declaration was not submitted by Montis. This national law was repealed in 2003 since it did not comply with Article 5(2) of the Berne Convention, which provides, ‘The enjoyment and the exercise of these rights shall not be subject to any formality.’ In the plaintiff’s view, Directive 93/98 had to be applied in the sense of protecting the chair and the armchair for the life of the author plus 70 years pma. The Hoge Raad stayed the proceedings and referred some questions to the ECJ for a preliminary ruling. In essence, the Dutch court wanted to know whether Directive 93/98, which established a term of protection for copyright in the EU, could be retroactively applied to works that were already in the public domain on the date when it came into force as a result of a national law. The ECJ gave a negative answer: if, pursuant to national law, the copyright in a work is 8.73 extinguished prior to 1 July 1995, the 70-year term of protection does not apply to the work in question. It does not matter if that extinction occurred as a result of a national law that does not comply with the Berne Convention. The aim of the Directive 93/98 is not to determine the conditions under which a work must be protected but merely to harmonise the term of protection. Besides, the ECJ reminded that the Berne Convention was not binding on the EU until 1 January 1995, the date in which the TRIPS Agreement, which had been approved on behalf of the EU, entered into force. Directive 93/98 was adopted prior to that date. However, the ECJ did not highlight an important thing: Articles 2(7) and 7(4) of the Berne Convention give the Member

100 101

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Ibid., para. 28. Ibid., para. 35. The ECJ ruled that the British rock star, Phil Collins, was entitled to stop a German record company selling unauthorised bootleg recordings of a concert Mr. Collins gave in California in 1983. The ECJ said EC Treaty rules on non-discrimination meant Mr. Collins was entitled to the same protection granted to German performers. Therefore, if a German performer whose live performance was recorded without his consent in the US can prevent marketing of that recording in Germany, a British performer can also stop sales of unauthorised recordings of his works under German copyright law. This decision made clear that the EC Treaty’s ban on discrimination on the basis of nationality requires complete national treatment between the EU Member States, with no comparison of terms of protection among EU countries. Case C-60/98, Butterfly Music Srl v. Carosello Edizioni Musicali e Discografiche Srl [1999] ECR I-03939, para. 20.

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States freedom to determine the extent of the protection of their laws to works of applied arts, designs and models. These provisions of the Berne Convention reflect the attempts of the drafters of this international treaty to deal with the complex problem of protection of artistic works that have an industrial application too.103 Dutch law – that was in force at that time – might not have been incompatible with the Berne Convention.104 8.74 As mentioned in the commentary of Article 2 of the Term Directive, Article 10(4) leaves it up to the national authorities to decide whether to apply this provision to cinematographic or audiovisual works created before 1 July 1994. 8.75 In order to reduce the effect of the rules contained within Article 10(1) and (2) of the Term Directive on those who had acquired rights before the abovementioned date or on those persons who had been exploiting public domain works or other subject matter, Article 10(3) provides that it is to be without prejudice to any acts of exploitation performed before 1 July 1995. The Directive, thus, does not apply retroactively. Article 10(3) is important, since because Article 10(2) revives lapsed copyrights, Article 10(3) accommodates the interests of third parties, e.g. translators who had begun to exploit the work that was in the public domain in that country in order to translate it to other languages. 8.76 In addition, Recitals 24 and 25 of the codified version require Member States to protect the acquired rights of third parties and the principle of legitimate expectations. Member States may provide that ‘in certain circumstances the copyright and related rights which are revived pursuant to this Directive may not give rise to payments by persons who undertook in good faith the exploitation of the works at the time when such works lay within the public domain’. According to the ECJ, Member States are obliged to adopt an adequate transitional regime, but the contents of such measures are left to their discretion. This lack of uniform rules at the European level led to substantial differences amongst national legislations.105 However, national measures cannot have the overall effect of preventing the application of the new terms of protection on the date laid down by the Directive,106 because, while the principle of protection of legitimate expectations is one of the fundamental principles of the EU, it cannot be extended to the point of generally preventing new rules from applying to the future consequences of situations which arose earlier.107

103 104

Therefore, the term of protection of works of applied arts needs to be assessed country by country. See Sterling, note 4, 540. The ECJ did not follow the Advocate General Campos Sánchez-Bordona’s opinion. In his conclusions delivered on 31 May 2016, it was stated: Article 10(2) of Council Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights precludes a provision of national law under which there continues to be regarded as extinguished copyright in respect of an artistic work which, by reason of mere non-fulfilment of an administrative formality, had expired before 1 July 1995. It falls to the national court to verify whether, in the circumstances of the proceedings between private individuals being heard by it, it can interpret its law in accordance with the abovementioned directive and, if so, disapply the provision of national law (first final conclusion).

105 106 107

The Advocate General concluded that there must be a revival of copyright which had entered the public domain without any legally permissible cause. The Netherlands courts have the competence to analyse whether the maintenance declaration was illegal and to hold that, being deemed not to be in place, that requirement had not existed. ‘In those circumstances, the period of 70 years p.m.a. of copyright protection under Article 10(2) of Directive 93/98 would prove applicable, since Montis’s rights would, despite everything, have been valid in a Member State as at 1 July 1995 (para. 97).’ See Kur and Dreier, note 45, 262. Case C-60/98, Butterfly Music Srl v. Carosello Edizioni Musicali e Discografiche Srl [1999] ECR I-03939, para. 23. Ibid., para. 25.

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ARTICLE 10A: TRANSITIONAL MEASURES

III. APPLICATION IN TIME OF THE MODIFICATIONS INTRODUCED BY DIRECTIVE 2011/77/EU Pursuant to Article 10(5) and (6) of the Term Directive, which were introduced by Directive 8.77 2011/77/EU, the harmonised terms apply in all Member States provided that the fixations of performances, the phonograms and the musical compositions with words, were protected in at least one Member State on 1 November 2003, pursuant to Articles 3(1) and (2) and 1(7), as amended or introduced by Directive 2011/77/EU. The abovementioned considerations regarding the principle of non-discrimination and respect of 8.78 acquired rights and legitimate expectations are applicable to those new rules. Indeed, the second paragraph of Article 10(6) of the Term Directive emphasises, once again, the obligation of Member States to provide an adequate transitional regime.

NOTES 1. CJEU case law Case C-169/15, Montis Design BV v. Goossens Meubelen BV [2016]. Case C-240/07, Sony Music Entertainment GmbH v. Falcon Neue Medien Vertrieb GmbH, [2009] ECR I-00263. Case C-60/98, Butterfly Music Srl v. Carosello Edizioni Musicali e Discografiche Srl [1999] ECR I-03939. Case C-92/92, Phil Collins v. Intrat Handelsgesellschaft mBH [1993] ECR I-05145.

2. Bibliography Kur, A. and T. Dreier, European Intellectual Property Law. Text, Cases and Materials, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2013. Martín-Prat, M., ‘New Rules in European Copyright’ (1994) 4 EIPR 145. See also Bibliography in Art. 1.

CHAPTER XI SOME REMARKS ON NATIONAL TRANSITIONAL MEASURES ARTICLE 10A: TRANSITIONAL MEASURES 1.

2.

In the absence of clear contractual indications to the contrary, a contract on transfer or assignment concluded before 1 November 2013 shall be deemed to continue to produce its effects beyond the moment at which, by virtue of Article 3(1) in the version thereof in force on 30 October 2011, the performer would no longer be protected. Member States may provide that contracts on transfer or assignment which entitle a performer to recurring payments and which are concluded before 1 November 2013 can be modified following the 50th year after the phonogram was lawfully published or, failing such publication, the 50th year after it was lawfully communicated to the public.

I. COMMENTS For the sake of legal certainty, it is provided that, in the absence of clear contractual indications to 8.79 the contrary, a contractual transfer or assignment of rights concluded before the deadline for the national implementation of Directive 2011/77/EU – that is, before 1 November 2013 – shall

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Chapter 8 THE TERM DIRECTIVE

continue to produce effects for the extended term, even when that performer was no longer protected under the old rules, i.e. the rules contained in Articles 3(1) and (2) before the 2011 amendments. The purpose is that these contracts continue to produce their effects for the extended term.108 8.80 In addition, taking into account, on the one hand, the principle of respect for acquired rights and legitimate expectations and, on the other hand, the application in time rule contained in Article 10(5) of the Term Directive in its amended version of 2011, the Directive leaves it to the Member States’ discretion to decide whether certain terms in those contracts, which provide for recurring payments, can be renegotiated for the benefit of performers after the expiry of the 50-years’ term after the lawful publication or lawful communication to the public, so the producer and performer may agree new conditions for the extended term. Besides, Recital 16 of Directive 2011/77/EU provides that Member States should have procedures in place to cover the eventuality that the renegotiation fails.

CHAPTER XII NOTIFICATION AND COMMUNICATION OBLIGATIONS ARTICLE 11 (CODIFIED VERSION) NOTIFICATION AND COMMUNICATION 1. 2.

Member States shall immediately notify the Commission of any governmental plan to grant new related rights, including the basic reasons for their introduction and the term of protection envisaged. Member States shall communicate to the Commission the texts of the provisions of internal law which they adopt in the field governed by this Directive.

I. COMMENTS 8.81 As was mentioned in the commentary to Article 3 of the Directive, the list of related rights contained within it is not exhaustive. Therefore, Member States could regulate new neighbouring rights at a national level. Pursuant to this provision, the European Commission has the opportunity to be advised of national initiatives and to propose, if appropriate, new harmonisation norms. Consequently, the reporting obligation includes not only notification of the national initiative, but also reasons that justify the need for that particular related right as well as the term of protection.109 8.82 Although the first paragraph of this provision only refers to related rights, the second paragraph is a general duty for Member States to transpose. A similar norm is also contained in Article 3 of Directive 2011/77/EU. The obligation expressly established in this latter norm is wider. The national legislatures must inform the Commission about the implementation and communicate the text of the main provisions of national law regulated in the field covered by the Directive. Besides, the national measures or their publication shall contain a reference to the Directive.

108 109

Recital 15 of Directive 2011/77/EU. Recital 19 of the Term Directive emphasises this idea, in particular in relation to the protection of critical and scientific publications.

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ARTICLE 11 OF THE INITIAL VERSION, ABOLISHED IN THE CODIFIED VERSION

CHAPTER XIII INITIAL REPEAL ARTICLE 11 OF THE INITIAL VERSION, ABOLISHED IN THE CODIFIED VERSION TECHNICAL ADAPTATION 1. 2.

Article 8 of Directive 91/250/EEC is hereby repealed. Articles 11 and 12 of Directive 92/100/EEC are hereby repealed.

I. COMMENTS As said in the commentary to Article 1 of the Term Directive, the rules of duration and calculation 8.83 of the term of protection do not differentiate between the various kinds or categories of works, so all the considerations contained in this provision apply to computer programs, provided they are works. It is considered that Article 8 of the initial version of the Computer Program Directive, which was based upon the general rule laid down in Article 7(1) of the Berne Convention,110 merely made provisional arrangements governing the term of protection of computer programs and allowed Member States to maintain the longer terms of protection.111 Therefore, in 1993 the European legislature made a complete and absolute repeal of Article 8 of the Computer Program Directive, which means that, since the harmonisation made by the Term Directive is a high level protection, the authorisation to Member States to maintain longer terms of protection for computer programs must also be repealed.112 On the other hand, the European legislature considered that Articles 11 and 12 of the Rental and 8.84 Lending Rights Directive only provided for minimum terms of protection of copyright and related rights, based upon the minimum term laid down in the Berne Convention and the Geneva Convention, and it was subject to further harmonisation.113 Consequently, since the Term Directive provides for such a harmonisation, the abovementioned provisions of the Rental and Lending Rights Directive should also be repealed.

NOTES 1. Related instruments Articles 11 and 12 Dir. 92/100 on rental right and lending right. Article 8 Dir. 91/250 on computer programs. Article 4 Geneva Convention for the Protection of Producers and Phonograms against Unauthorized Duplication of their Phonograms. Article 7 Berne Convention for the Protection of Literary and Artistic Works.

2. Bibliography See Bibliography in Art. 1.

110

According to Art. 8(1) of the Computer Program Directive: Protection shall be granted for the life of the author and for 50 years after his death or after the death of the last surviving author; where the computer program is an anonymous or pseudonymous work, or where a legal person is designated as the author by national legislation in accordance with Article 2 (1), the term of protection shall be 50 years from the time that the computer program is first lawfully made available to the public. The term of protection shall be deemed to begin on the first of January of the year following the abovementioned events.

111 112 113

Recital 15 of the initial version of the Term Directive. See Gaubiac, Linder and Adams, note 7, 159; and Walter and Von Lewinski, note 19, 630. Recital 16 of the Directive’s initial version.

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Chapter 8 THE TERM DIRECTIVE

CHAPTER XIV REPEAL OF THE INITIAL VERSION OF THE DIRECTIVE ARTICLE 12 (CODIFIED VERSION): REPEAL Directive 93/98/EEC is hereby repealed, without prejudice to the obligations of the Member States relating to the time-limits for transposition into national law, as set out in Part B of Annex I, of the Directives, and their application. References made to the repealed Directive shall be construed as being made to this Directive and should be read in accordance with the correlation table in Annex II.

I. COMMENTS 8.85 Directive 2006/116 entirely repealed the initial version of the Term Directive, i.e. Directive 93/98/EEC. Consequently, references made to Directive 93/98/EEC shall be construed as being made to Directive 2006/116.

CHAPTER XV SOME CONSIDERATIONS ABOUT THE ENTRY INTO FORCE OF THE DIRECTIVE ARTICLE 13 DIRECTIVE 2006/116 AND ARTICLE 4 OF DIRECTIVE 2011/77/EU: ENTRY INTO FORCE This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

I. COMMENTS 8.86 Pursuant to Article 13(1) of the Term Directive in its initial version of 1993, Member States had a time frame of more than one and a half years from the adoption of the Directive in order to implement it, so national measures should be enacted by 1 July 1995 at the latest. 8.87 The codified version of the Term Directive entered into force on 16 January 2007, which was the 20th day after its publication in the Official Journal of the European Union, on 27 December 2006. Directive 2011/77/EU was published on 11 October 2011, so it entered into force on 31 October 2011. According to Article 2 of Directive 2011/77/EU, Member States shall bring into force the national provisions necessary to comply with this Directive by 1 November 2013. Thus, Member States have been given two years from the date of its coming into force to incorporate the amendments into their national legislation.114 After that, by 1 November 2016, Article 3(1) of Directive 2011/77/EU contained a reporting obligation: the Commission shall submit to the European Parliament, the Council and the European Economic and Social Committee, a report on

114

For an overview see Angelopoulos, 2011, note 31, 987.

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ARTICLE 14 OF DIRECTIVE 2006/116 AND ARTICLE 5 OF DIRECTIVE 2011/77/EU – ADDRESSEES

the application of this Directive in the light of the development of the digital market. This report shall be accompanied, where appropriate, by a proposal for the further amendment of Directive 2006/116/EC.

CHAPTER XVI ADDRESSEES ARTICLE 14 OF DIRECTIVE 2006/116 AND ARTICLE 5 OF DIRECTIVE 2011/77/EU – ADDRESSEES This Directive is addressed to the Member States.

I. COMMENTS As a Directive addressed to all Member States, it is binding upon the Member States – upon their 8.88 legislature and their judges – as to the result to be achieved, but leaves to the national authorities the choice of form and methods of implementation (Art. 188 of the Treaty on the Functioning of the European Union).

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9 THE DATABASE DIRECTIVE Estelle Derclaye1 DIRECTIVE 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases

OJ NO L 77/20, 27/03/96 ARTICLE 6: EXCEPTIONS TO RESTRICTED ACTS

CHAPTER I: SCOPE

I.

ARTICLE 1: SCOPE I.

COMMENTARY 1. Paragraph 1 2. Paragraph 2 A. Arranged in a systematic or methodical way B. Individually accessible by electronic or other means 3. Paragraph 3

9.01 9.01 9.02 9.05

COMMENTARY

9.06 9.07

I. 9.09

ARTICLE 3: OBJECT OF PROTECTION COMMENTARY 1. Paragraph 1 2. Paragraph 2

9.12 9.12 9.16

ARTICLE 4: DATABASE AUTHORSHIP I.

COMMENTARY

9.17

ARTICLE 5: RESTRICTED ACTS I.

COMMENTARY 1. Reproduction 2. Translation 3. Distribution 4. Communication to the public 5. Exhaustion 6. Infringement

1

9.30

ARTICLE 7: OBJECT OF PROTECTION

CHAPTER II: COPYRIGHT I.

9.27 9.27 9.28 9.29

CHAPTER III: SUI GENERIS RIGHT

ARTICLE 2: LIMITATIONS ON THE SCOPE I.

COMMENTARY 1. Paragraph 1 2. Paragraph 2 3. Paragraph 3 4. Other copyright aspects not regulated by the Database Directive

9.20 9.21 9.22 9.23 9.24 9.25 9.26

COMMENTARY 1. The nature of the sui generis right 2. Reasons for the sui generis right 3. Protection requirement: qualitative or quantitative substantial investment in the obtaining, verification or presentation of the database’s contents A. Investment B. Public sector databases C. Substantial D. Qualitatively and quantitatively E. Obtaining F. Verification G. Presentation 4. Ownership 5. The rights A. Extraction B. Re-utilisation C. Public lending 6. Infringement A. Paragraph 1 B. Paragraph 4 C. Paragraph 5

9.31 9.31 9.32

9.33 9.33 9.34 9.36 9.37 9.38 9.42 9.43 9.44 9.45 9.46 9.47 9.50 9.51 9.52 9.55 9.56

I would like to thank Gemma Minero for kindly providing summaries in English of the Spanish Supreme Court decisions.

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ARTICLE 1: SCOPE CHAPTER IV: COMMON PROVISIONS

ARTICLE 8: RIGHTS AND OBLIGATIONS OF LAWFUL USERS I.

ARTICLE 12: REMEDIES

COMMENTARY 1. Concept of lawful user 2. Paragraph 1 3. Paragraph 2 4. Paragraph 3

9.57 9.58 9.60 9.61 9.62

ARTICLE 9: EXCEPTIONS TO THE SUI GENERIS RIGHT I.

COMMENTARY

I.

I.

9.63

COMMENTARY 1. Paragraphs 1 and 2 2. Paragraph 3

9.68 9.68 9.69

I.

COMMENTARY

COMMENTARY

9.74

COMMENTARY 1. Paragraph 1 2. Paragraph 2 3. Paragraphs 3, 4 and 5

9.79 9.79 9.80 9.81

ARTICLE 15: BINDING NATURE OF CERTAIN PROVISIONS I.

ARTICLE 11: BENEFICIARIES OF PROTECTION UNDER THE SUI GENERIS RIGHT I.

9.73

ARTICLE 14: APPLICATION OVER TIME

ARTICLE 10: TERM OF PROTECTION I.

COMMENTARY

ARTICLE 13: CONTINUED APPLICATION OF OTHER LEGAL PROVISIONS

COMMENTARY

9.82

ARTICLE 16: FINAL PROVISIONS 9.71

I.

COMMENTARY

9.83

CHAPTER I SCOPE ARTICLE 1: SCOPE 1. 2.

This Directive concerns the legal protection of databases in any form. For the purposes of this Directive, “database” shall mean a collection of independent works, data or other materials arranged in a systematic or methodical way and individually accessible by electronic or other means. Protection under this Directive shall not apply to computer programs used in the making or operation of databases accessible by electronic means.

3.

I. COMMENTARY 1. Paragraph 1 The first sentence of Article 1 has not attracted controversy. The literature agreed that ‘any form’ 9.01 means analogue or digital format and includes any potential future format.2 Accordingly, databases published on paper as well as electronic databases accessible online and on hard copies such as CD-ROMs are included within the scope of protection. The CJEU confirmed that the definition

2

This had been expressed by several commentators e.g. W. Cornish, ‘European Community Directive on database protection’, (1996) Columbia-VLA Journal of Law & the Arts, 21, 4; M. Lehmann, ‘The European Database Directive and its implementation into German law’, (1998) International Review of Intellectual Property and Competition Law, 776; M. Davison, The Legal Protection of Databases, CUP, Cambridge, 2003, 70–73; T. Cook, ‘The current status of the EC Database Directive’, (1995) Copyright World, 52, 28; F. Pollaud-Dulian, ‘Brèves remarques sur la directive du 11 mars 1996 concernant la protection juridique des bases de données’, (1996) D. Aff., n° 18, 540; I. Stamatoudi, ‘The EU Database Directive: Reconceptualising copyright and retracing the future of the sui generis right’, (1997) Hellenic Review of International Law, 50, 441. For more literature, see E. Derclaye, The Legal Protection of Databases. A Comparative Analysis, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2008, 54.

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of a database is broad and was meant to be.3 Protection therefore subsists irrelevant of the medium. It would have contradicted the Berne Convention, WCT and TRIPs if the CJEU had decided they could not be in all formats. In addition, the CJEU ruled that in order to be protected a database must be fixed.4 The Directive was silent in this regard except for Recital 13 which stated that a database needed to be stored. Thus a database which is only in broadcast format is not protectable.5 Nor is a database in purely oral form.

2. Paragraph 2 9.02 The CJEU has interpreted most of the terms of the second sentence of Article 1. A ‘collection ’ does not mean a large number of elements.6 The absence of such requirement may overprotect databases as technically a database composed of only two elements could be protected.7 However, if Recitals 45, 46 and 47 are taken into account, they should prevent abuses of a dominant position which could result from small but valuable databases. 9.03 The Directive does not define ‘independent ’ but Recital 17 gives examples of subject matter which are not independent, namely a literary, musical or audiovisual work. The CJEU has interpreted the requirement of independence to mean that the materials must be separable from one another without their informative, literary, artistic, musical or other value being affected.8 An independent material must have autonomous informative value.9 In 2005, the German Supreme Court applied the CJEU case law faithfully. It held in the Hit Bilanz case that a particular piece of music ranked ninth in the chart list had autonomous informative value. Knowledge of the other elements of the database and their content was not necessary.10 However, arguably, as it stands, the CJEU’s definition does not go far enough. By referring to Recital 17, the Court must have intended to give a more precise definition to the criterion of independence, i.e. that the elements of a database can be withdrawn or added without the whole database losing its meaning.11 This is why novels, films and music cannot be databases: if an element (a chapter, a word, a frame or note) is withdrawn or added to such works, these works no longer make sense.12 The CJEU’s interpretation also seems to imply that all materials must be independent so that a database composed partly of dependent and partly of independent materials is not protectable. Some commentators have rightly observed that ‘independent’ must mean ‘independent as between each item of material rather than as between the material and the database’.13 Otherwise, it ‘could lead to some strange findings as to what constituted a database’.14 Indeed, it would be absurd, as it would exclude databases whose materials have never had independent existence apart from the database to which they belong. The CJEU ruled that it is irrelevant whether the collection is made up of materials from a source or sources other than the person who constitutes that collection, materials created by that person herself or

3 4 5 6 7 8 9 10 11 12 13 14

Case C-444/02 Fixtures Marketing Ltd v Organismos Prognostikon Agonon Podosfairou (OPAP) [2004] ECR I-10365, paras 20ff. Ibid., para. 30. Contra: T. Sanks, ‘Database protection: National and international attempts to provide legal protection for databases’, (1998) Florida State University Law Review, 25, 991, 997. OPAP, para. 24. See Derclaye, 2008, 56. OPAP, paras 29, 32. OPAP, para. 33. Hit Bilanz, 21 July 2005, I ZR 290/02, available on . Derclaye, 2008, 62–3. A. Strowel and J-P. Triaille, Le droit d’auteur du logiciel au multimédia, Story-Scientia, CRID, Bruylant, Brussels, 1997, 260; F. De Visscher and B. Michaux, Précis du droit d’auteur et des droits voisins, Bruylant, Brussels, 2000, 234. S. Chalton, ‘The copyright and rights in Databases Regulations 1997: Some outstanding issues on implementation of the Database Directive’, (1998) EIPR, 178–9. Davison, 72.

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ARTICLE 1: SCOPE

materials falling within both those categories.15 A collection can therefore be composed of pre-existing materials or materials created by the database maker herself (databases which are made wholly of elements created by the database maker are generally called sole-source databases). The CJEU has held that maps can be databases. Their elements are independent because ‘once extracted, that information provides the [users of] that information with relevant information’.16 Such information has ‘sufficient informative value’ to be considered independent materials within the meaning of Article 1(2) of the Database Directive. The Court added that the ‘autonomous informative value of material which has been extracted from a collection must be assessed in the light of the value of the information not for a typical user of the collection concerned, but for each third party interested by the extracted material’.17 The term ‘works ’ refers to copyright works,18 whether or not they are still protected, because works 9.04 whose protection has expired can qualify as ‘data’ or ‘materials’ anyway. Recital 19 states that compilations of recordings of musical performances on a CD are in principle excluded from protection, not because they are works but because they generally do not attract a substantial investment and do not fulfil the requirements of copyright protection (originality). The CJEU did not define ‘data ’ but in effect it must mean information i.e. data that is understandable to humans.19 The nature of the data is irrelevant.20 The term ‘materials ’ encompasses works and data. But it is unclear what the term means other than works and data. The term has practically no limit.21 The CJEU left this question unanswered.22 Arguably, ‘materials’ includes tangible objects such as stones, cars, coins or stamps.23 However, according to Recitals 10 and 12, ‘the legal protection provided by the directive is intended to encourage the development of systems performing a function of “storage” and “processing” of information’.24 It is doubtful that a meal, a dinner service or a room can be said to be a system performing a function of ‘storage’ and ‘processing’ of information. Probably, therefore, on a proper construction of the Directive, the term ‘materials’ does not include tangible objects unless they are works.

A. Arranged in a systematic or methodical way The Directive does not define systematic or methodical arrangement but Recital 21 states that it is 9.05 not necessary for the database’s materials to be physically stored in an organised manner. The CJEU 15 16

17 18 19

20 21

22 23

24

OPAP, para. 25. Case C-490/14, Freistaat Bayern v Verlag Esterbauer GmbH [2015] Bus. L.R. 1428, paras 28–29. For commentary, see M. Leistner, ‘Was lange währt …: EuGH entscheidet zur Schutzfähigkeit geografischer Karten als Datenbanken’ (‘What Takes A Long Time … ECJ decides to protect geographic maps as databases’), (2016) GRUR 42. Freistaat Bayern, para. 27. Davison, 73. J. Gaster, Der Rechtschutz von Databanken, Carl Heymanns, Cologne, 1999, 37, no 66 (data ‘discovered in nature’ is not protected as such); E.J. Dommering ‘An introduction to information law, works of fact at the crossroads of freedom and protection’, in E.J. Dommering and P.B. Hugenhotlz (eds), Protecting Works of Fact, Copyright Freedom of Expression and Information Law, Kluwer law and taxation publishers, Deventer, Boston, 1991, 15 (in legal literature the term ‘data’ is often used when what is meant is ‘information’. He gives the example of the term ‘database’). The term information is also used in the Green Paper and Recitals of the Directive. OPAP, para. 23. A. Quaedvlieg, ‘Onafhankelijk, geordend en toegangkelijk: het object van het databankenrecht in de richtlijn’, (2000) 9 Informatierecht/AMI 177, 179. The term used in French, German, Dutch and Italian is ‘element’. See also L. Bygrave, ‘The data difficulty in database protection’, (2013) European Intellectual Property Review, 35(1), 26–30 (the Directive and the preparatory materials are ambiguous so that they do not rule out that tangible objects can be materials). OPAP, paras 23 and 25. See e.g. H. Speyaert, ‘De databankrichtlijn en haar gevolgen voor Nederland’, (1996) Informatierecht/AMI, 151, 153; D. Visser, ‘Carnaval in Oss: Variété, Databank of folkore?’ (1999) Mediaforum, 374. Contra: I. Stamatoudi, ‘To what extent are multimedia products databases’, in I. Stamatoudi and P.L.C. Torremans (eds), Perspectives on Intellectual Property Series, vol 8, Sweet & Maxwell, London, 2000, 23; L. Mansani, ‘Musei, esposizioni e banche dati’, (1999) AIDA, 184, 187. OPAP, para. 28. See also Green Paper, para. 6.1.1, 205; Explanatory Memorandum, para. 3.1.1.

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confirmed that the arrangement need not be physically apparent but that the condition of systematic and methodical arrangement requires that there be some technical means such as electronic, electromagnetic or electro-optical processes (as provided in Recital 13) or other means such as an index, a table of contents or a particular plan or method of classification, to allow the retrieval of any independent material contained within the database.25 This criterion does not mean that a database must be its maker’s own intellectual creation to qualify. The criterion of originality is only relevant to assess whether a database qualifies for copyright protection.26

B. Individually accessible by electronic or other means 9.06 The CJEU has not given any guidance on the requirement of individual accessibility as such. The literature is not unanimous about the requirement’s meaning so it is unclear. Arguably, these words do not add to the previous requirement. It is probably redundant and therefore unnecessary. Probably its inclusion by the legislator was to make completely sure that haphazard collections could not qualify. 3. Paragraph 3 9.07 This sentence means that computer programs used in the making or operation of databases or any collection included in such computer programs which could qualify as a database cannot be protected as a database by copyright or the sui generis right.27 A contrario, computer programs and parts of computer programs which are not used in the making or operation of electronic databases can benefit from the sui generis right if they can be classified as databases. Nevertheless, it will be very difficult for any computer program to qualify as a database simply because a program’s elements will almost inevitably not be independent. If an element is withdrawn, the computer program can no longer be understood and/or cannot function.28 However, lists included in a program could qualify if all the conditions are fulfilled. This was expressly stated in the Mars UK v Teknowledge case.29 9.08 Finally, materials necessary for the operation or consultation of certain databases such as thesauruses and indexation systems can be protected by the sui generis right and/or copyright (Recital 20) but it is unclear whether they have to fit in the definition of a database. What is clear is that they would need to be either original or result from a substantial investment. The Spanish Supreme Court has confirmed that intellectual property protection may also apply to the materials necessary for the operation or consultation of the database. These materials are essential for the database elements to be systematically and methodically arranged and constitute an original creation.30

25 26 27

28 29

30

OPAP, para. 30. Ibid, para. 26. Contra: S. Beutler, ‘The protection of multimedia products through the European Community’s Directive on the legal protection of databases’ (1996), Ent. LR, 317, 324–5 (on the basis of Recital 23 only those computer programs protected by copyright are excluded; computer programs used in the making or operation of a database which do not obtain copyright could be protected by the sui generis right). Westkamp, 5. [2000] FSR 138. See also Autonet v Promasy, Pres. Arr. Arnhem, 27 December 2004, available at (accessed 11 February 2013). (Promasy was held to infringe Autonet’s sui generis right by re-utilising lists of spare parts and spare parts codes included in Autonet’s computer program.) Case STS 7176/2008, 18 December 2008, available at (accessed 11 February 2013).

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ARTICLE 1: SCOPE

NOTES 1. Related instruments Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs, OJ L111/16, 5.6.2009. Explanatory Memorandum to the draft database directive, COM (92) 24 final – SYN 393 Brussels, 13 May 1992, OJ C/156/4, 23.6.1992. Green Paper on Copyright and Challenge of Technology – Copyright Issues Requiring Immediate Action, COM (88)172 final, 7.6.1988. WIPO Performances and Phonograms Treaty adopted on 20 December 1996 (WPPT). Agreement on Trade-Related Aspects of Intellectual Property Rights signed on 15 April 1994 (TRIPS). World Copyright Treaty (WCT) of December 20 1996.

2. CJEU case law Fixtures Marketing Ltd v Organismos Prognostikon Agonon Podosfairou (OPAP) (C-444/02) [2004] ECR I-10365 (OPAP). Freistaat Bayern v Verlag Esterbauer GmbH (C-490/14) [2015] Bus. L.R. 1428.

3. Bibliography Beutler, S., ‘The protection of multimedia products through the European Community’s directive on the legal protection of databases’, (1996) Ent LR, 317. Bygrave, L. ‘The data difficulty in database protection’, (2013) European Intellectual Property Review, 35(1), 25. Chalton, S. ‘The copyright and rights in Databases Regulations 1997: Some outstanding issues on implementation of the Database Directive’, (1998) European Intellectual Property Review, 20(5), 178. Cook, T. ‘The current status of the EC Database Directive’, (1995) Copyright World, 52, 27. Cornish, W. ‘European Community Directive on database protection’, (1996) Columbia-VLA Journal of Law & the Arts, 21, 1. Davison, M. The Legal Protection of Databases, CUP, Cambridge, 2003. De Visscher, F. and B. Michaux, Précis du droit d’auteur et des droits voisins, Bruylant, Brussels, 2000. Derclaye, E. The Legal Protection of Databases, A Comparative Analysis, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2008. Dommering, E.J. ‘An introduction to information law, works of fact at the crossroads of freedom and protection’, in Dommering, E.J. and P.B. Hugenhotlz (eds), Protecting Works of Fact, Copyright Freedom of Expression and Information Law, Kluwer law and taxation publishers, Deventer/Boston, 1991. Gaster, J. Der Rechtschutz von Databanken, Carl Heymanns, Cologne, 1999. Lehmann, M. ‘The European Database Directive and its implementation into German law’, (1998) International Review of Intellectual Property and Competition Law, 776. Leistner, M. ‘Was lange währt …: EuGH entscheidet zur Schutzfähigkeit geografischer Karten als Datenbanken’ (‘What Takes A Long Time … ECJ decides to protect geographic maps as databases’), (2016) GRUR 42. Mansani, L. ‘Musei, esposizioni e banche dati’, (1999) AIDA 184. Pollaud-Dulian, F. ‘Brèves remarques sur la directive du 11 mars 1996 concernant la protection juridique des bases de données’, (1996) D. Aff., n° 18, 539. Quaedvlieg, A. ‘Onafhankelijk, geordend en toegangkelijk: het object van het databankenrecht in de richtlijn’, (2000) 9 Informatierecht/AMI 177. Sanks, T. ‘Database protection: National and international attempts to provide legal protection for databases’, (1998) Florida State University Law Review, 25, 991. Speyaert, H. ‘De databankrichtlijn en haar gevolgen voor Nederland’, (1996) Informatierecht/AMI 151. Stamatoudi, I. ‘The EU Database Directive: Reconceptualising copyright and retracing the future of the sui generis right’, (1997) Hellenic Review of International Law, 50, 435. Stamatoudi, I. ‘To what extent are multimedia products databases’, in Stamatoudi, I. and P.L.C. Torremans (eds), Perspectives on Intellectual Property Series, vol 8, Sweet & Maxwell, London, 2000. Strowel, A. and J.-P. Triaille, Le droit d’auteur du logiciel au multimédia, Story-Scientia, CRID, Bruylant, Brussels, 1997. Visser, D. ‘Carnaval in Oss: Variété, Databank of folkore?’ (1999) Mediaforum 374.

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Chapter 9 THE DATABASE DIRECTIVE Westkamp, G. ‘EU Database protection for information uses under an intellectual property scheme: Has the time arrived for a flexible assessment of the European Database Directive?’ 11th Fordham Intellectual Property and Policy Conference, Fordham School of Law, 2003.

ARTICLE 2: LIMITATIONS ON THE SCOPE This Directive shall apply without prejudice to Community provisions relating to: (a) (b) (c)

the legal protection of computer programs; rental right, lending right and certain rights related to copyright in the field of intellectual property; the term of protection of copyright and certain related rights.

I. COMMENTARY 9.09 The aim of Article 2 is to avoid conflicts between norms of the several Directives and to leave the previous Directives unaffected.31 In short, computer programs are solely protected by the Computer Program Directive but the provisions discussed under Article 1 apply in addition. For instance, if a computer program is protected by copyright and one or more internal lists by the sui generis right, there is a potential clash with the Software Directive’s provisions, especially the exceptions. The sui generis right could prevent the application e.g. of the decompilation exception.32 If this is so, Article 2 of the Database Directive applies, which means that the Software Directive prevails and decompilation remains possible despite the existence of the sui generis right. 9.10 Databases protected by copyright benefit from the right of rental and public lending according to the provisions of Directive 2006/115. As shall be seen below, whereas Article 7 provides for a right of rental, it does not provide for a public lending right, which contrasts with copyright law. Article 2 also means that to calculate the term of databases protected by copyright, one needs to apply Directive 2006/116. We refer the reader to the relevant chapter of this book for the relevant provisions of these three Directives. 9.11 Strangely, Article 2 does not mention the Satellite and Cable Directive. This is probably an involuntary omission.

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, OJ L 248/5, 27.9.1993. Directive 2006/115 of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376, 27.12.2006 as amended by Dir. 2011/77. Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights (codified version) OJ L 372/12, 27.12.2006.

31 32

Gaster, 43. M. Powell, ‘The European Union’s Database Directive: An international antidote to the side effects of Feist ’ (1997) Fordham International Law Journal, 20, 1215, 1231.

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ARTICLE 3: OBJECT OF PROTECTION Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs, OJ L 111/16, 5.6.2009.

2. Bibliography Powell, M. ‘The European Union’s Database Directive: An international antidote to the side effects of Feist ’, (1997) Fordham International Law Journal, 20, 1215. See also bibliography in Art. 1.

CHAPTER II COPYRIGHT ARTICLE 3: OBJECT OF PROTECTION 1.

2.

In accordance with this Directive, databases which, by reason of the selection or arrangement of their contents, constitute the author’s own intellectual creation shall be protected as such by copyright. No other criteria shall be applied to determine their eligibility for that protection. The copyright protection of databases provided for by this Directive shall not extend to their contents and shall be without prejudice to any rights subsisting in those contents themselves.

I. COMMENTARY 1. Paragraph 1 The first sentence of this Article provides that the originality criterion is the author’s own 9.12 intellectual creation, the same criterion as for computer programs. The criterion applies to the selection or arrangement of the materials included in the database as the copyright in question here protects a database’s structure, not its contents. The structure results from the arrangement and/or selection of its contents. The investment that went into gathering, verifying or otherwise presenting the contents is protected by the sui generis right (see Art. 7). The CJEU has clarified in several decisions what the words ‘the author’s own intellectual creation’ 9.13 mean. It refers to the criterion of originality. Applied to databases, the ‘criterion of originality is satisfied when, through the selection or arrangement of the data which it contains, its author expresses his creative ability in an original manner by making free and creative choices33 […] and thus stamps his “personal touch”’.34 Therefore, the criterion is ‘not satisfied when the setting up of

33

34

Case C-604/10 Football Dataco 1 March 2012, ECLI:EU:C:2012:115, para. 38. The CJEU refers to Case C-5/08 Infopaq International [2009] ECR I-6569, para. 45; Case C-393/09 Bezpecˇnostní Ahcnostní softwarová asociace [2010] ECR I-13971, para. 50 and Case C-145/10 Painer, 1 December 2011, ECLI:EU:C:2011:798, para. 89. The CJEU restated the same requirements in later cases, namely Case C-406/10, SAS Institute Inc. v World Programming Ltd EU:C:2012:259; Case C-683/17, Cofemel – Sociedad de Vestuário SA v G-Star Raw CV, ECLI:EU:C:2019:721; Case C-310/17, Levola Hengelo BV v Smilde Foods BV, ECLI:EU:C:2018:899. Case C-604/10 Football Dataco, para. 38 referring to Case-145/10 Painer, para. 92.

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the database is dictated by technical considerations, rules or constraints which leave no room for creative freedom’.35 9.14 As with the Computer Program Directive, the criterion of the author’s own intellectual creation is the only one applicable. Interpreting this second sentence of Article 3(1), the CJEU further ruled that ‘adding important significance’ to the data selected or arranged in the database is irrelevant to determining its originality.36 Likewise, other criteria such as skill and labour are not sufficient, if this skill or labour does not express the author’s own intellectual creation in the selection or arrangement of the data.37 The CJEU also held that selection and arrangement applies to the selection and arrangement of the data not to the creation of the data.38 Therefore, any originality in creating the data is not relevant to determine if the database is protected by copyright. The Football Dataco v Yahoo UK! case settled on remand to the Court of Appeal of England and Wales, but it is clear that there is no copyright in football fixtures. There is also no sui generis right in such fixtures (see below, Art. 7). 9.15 The Database Directive precludes national legislation which grants databases copyright under conditions which are different than those set out in Article 3(1) of the Directive, i.e. under conditions other than originality. This is discussed in detail under Article 13 below.

2. Paragraph 2 9.16 This paragraph is pretty straightforward and the CJEU confirmed its meaning at paragraphs 30 and 31 of Football Dataco. If (part of the) contents are protected by copyright (e.g. a collection of poems) or the sui generis right (e.g. a list of properties for sale) or any other right (e.g. a list of contact details of customers that may be protected by one or more of the data protection Directives), the copyright that protects the structure is added to those protections and leaves the latter otherwise unaffected.

NOTES 1. Related instruments Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data, OJ L 281/31, 23/11/1995.

2. CJEU case law Football Dataco v Yahoo UK! (C-604/10) [2012] ECR I-000; 1 March 2012, ECLI:EU:C:2012:115. SAS Institute v World Programming (C-406/10) [2012] ECR I-0000, 2 May 2012, EU:C:2012:259. Eva-Maria Painer v Standard VerlagsGmbH and Others (C-145/10) [2011] ECR I-0000; 1 December 2011, ECLI:EU:C:2011:798. Association Premier League and Others v QC Leisure and Others (C-403/08 and C-429/08) [2011] ECR I-09083.

35 36

37 38

Case C-604/10 Football Dataco, para. 39 referring to Case 393/09 Bezpecˇnostní hcnostní softwarová asociace, paras 48 and 49 and Cases C-403/08 and C-429/08 Football Association Premier League and Others [2011] ECR I-09083, para. 98. Case C-604/10 Football Dataco, para 41. On this case, see G. Minero, ‘Did the Database Directive actually harmonise the Database Copyright? Football Dataco Ltd v Brittens Pools Ltd and the ECJ’s rules against subsistence of database copyright in fixtures lists’, (2012) European Intellectual Property Review, 34(10), 728. Case C-604/10 Football Dataco, para. 42. Ibid, para. 32.

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ARTICLE 4: DATABASE AUTHORSHIP Bezpecˇnostní Ahcnostní softwarová asociace – Svaz softwarové ochrany v Ministerstvo kultury (Case C-393/09) [2010] ECR I-13971. Infopaq International A/S v Danske Dagblades Forening (Case C-5/08) [2009] ECR I-6569.

3. Bibliography Derclaye, E. ‘Football Dataco: skill and labour is dead!’, blog entry available on (accessed 11 February 2013). Minero, G. ‘Did the Database Directive actually harmonise the Database Copyright? Football Dataco Ltd v Brittens Pools Ltd and the ECJ’s rules against subsistence of database copyright in fixtures lists’, (2012) European Intellectual Property Review, 34(10), 728. Rosati, E. ‘Originality in a work, or a work of originality: The effects of the Infopaq decision’, (2011) European Intellectual Property Review, 33(12), 746.

ARTICLE 4: DATABASE AUTHORSHIP 1. 2. 3.

The author of a database shall be the natural person or group of natural persons who created the base or, where the legislation of the Member States so permits, the legal person designated as the rightholder by that legislation. Where collective works are recognised by the legislation of a Member State, the economic rights shall be owned by the person holding the copyright. In respect of a database created by a group of natural persons jointly, the exclusive rights shall be owned jointly.

I. COMMENTARY This Article is also uncontroversial as, in effect, it leaves it to the Member States to regulate 9.17 provisions relating to authorship of a database. This means that author’s rights countries can maintain a rule which always gives the authorship to a natural person first while copyright countries can instead have a rule that gives such authorship to a legal person at the outset. Otherwise, all that paragraphs 1 and 3 impose on Member States is that it should be possible for a group of natural persons to jointly author a database and if this is so, that their rights be owned jointly as well. Paragraph 2 allows Member States such as France to keep their category of collective works. The 9.18 paragraph is copied from Article 2(1)(1) of the Software Directive. The paragraph obliges Member States whose legislation recognises collective works to provide that the person holding the copyright shall own the economic rights. This is again loosely copied from Article 2(2) of the Software Directive. The wording in the Software Directive is better than in the Database Directive. The latter part of the sentence of Article 4(2) in the Database Directive is redundant. Unlike the Software Directive, the Database Directive does not have a provision concerning 9.19 databases authored by employees. Therefore, this situation is regulated entirely by national law. Recital 29 adds that nothing prevents Member States from adopting a provision similar to that in the Software Directive, namely that ‘where a database is created by an employee in the execution of his duties or following the instructions given by his employer, the employer exclusively shall be entitled to exercise all economic rights in the database so created, unless otherwise provided by contract’.

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NOTES 1. Related instruments Council Directive 91/250/EEC of the European Parliament and of the Council of 14 May 1991 on the legal protection of computer programs, OJ L 122/42, 17.5.1991. See also Related Instruments at Art. 1.

2. Bibliography Beunen, A.-M. The European Database Directive and its Effects in the Netherlands, France and the United Kingdom, Wolf Legal Publishers, Nijmegen, 2007.

ARTICLE 5: RESTRICTED ACTS In respect of the expression of the database which is protectable by copyright, the author of a database shall have the exclusive right to carry out or to authorise: (a) (b) (c) (d) (e)

temporary or permanent reproduction by any means and in any form, in whole or in part; translation, adaptation, arrangement and any other alteration; any form of distribution to the public of the database or of copies thereof. The first sale in the Community of a copy of the database by the rightholder or with his consent shall exhaust the right to control resale of that copy within the Community; any communication, display or performance to the public; any reproduction, distribution, communication, display or performance to the public of the results of the acts referred to in (b).

I. COMMENTARY 9.20 This article is also loosely copied from the respective article in the Software Directive (Art. 4) but adds to it, as paragraphs (d) and (e) do not appear as such in the Software Directive. Article 5 of the Database Directive covers all the usual rights existing in the international copyright conventions and in the Member States copyright laws. It also includes the performance and adaptation rights which are not included in the InfoSoc Directive.

1. Reproduction 9.21 The Infopaq decision is probably applicable by analogy since the provision on reproduction is virtually the same as in the InfoSoc Directive (only the words ‘direct’ and ‘indirect’ are missing in Art. 5 of the Database Directive).39 Also by analogy with the BHB decision40 (see below Art. 7), the consultation of an electronic database is a restricted act since it inevitably creates a temporary copy. By contrast, the consultation of a database in analogue format is not restricted.

39 40

Case C-5/08 Infopaq International [2009] ECR I-6569. Case C-203/02 The British Horseracing Board v William Hill Organization Ltd [2004] ECR I-10415, paras 54–5.

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ARTICLE 5: RESTRICTED ACTS

2. Translation This seemingly means a right to prevent or authorise the translation of the database’s contents into 9.22 another language. It would not include a translation of the database’s structure i.e. a change in the arrangement of the data.41

3. Distribution Article 5(c) does not include rental or public lending. Recital 24 clearly states that this is regulated 9.23 by the Rental and Lending Directive.

4. Communication to the public Even if the Database Directive is left unaffected by Article 1 of the InfoSoc Directive, it is arguable 9.24 that the case law on communication to the public under it would apply by analogy to keep EU law uniform.42 Paragraph (e) is simply declaratory and does not add to the above paragraphs. It makes sense that if a database has for instance been translated, its reproduction without authorisation would be an infringement of Article 5(a). Article 5(e) simply confirms that.

5. Exhaustion The UsedSoft decision does not apply by analogy for electronic databases because Recital 33 of the 9.25 Database Directive clearly states that ‘the question of exhaustion of the right of distribution does not arise in the case of on-line databases, which come within the field of provision of services’. This is despite the fact that Article 5 does not make a difference between electronic and non-electronic databases. However, it is clear from the same Recital that electronic databases in tangible, material, medium (e.g. CD-ROM) are subject to exhaustion.

6. Infringement For the copyright in the database to be infringed, the whole or part of the original structure has to 9.26 be taken (see in this connection Recital 35).43

NOTES 1. Related instruments Council Directive 91/250/EEC of the European Parliament and of the Council of 14 May 1991 on the legal protection of computer programs, OJ L 122/42, 17.5.1991. Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001. Directive 2006/115 EC of the European Parliament and of the Council of on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376/28, 27.12.2006.

41 42 43

Gaster, 85. Thus the abundant case law of the CJEU on the right of communication to the public would apply. On this case law, see Chapter X. Thus the case law of the CJEU applies, in the main Infopaq I. On this case law, see Chapter X.

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2. CJEU case law The British Horseracing Board v William Hill Organization Ltd (C-203/02) [2004] ECR I-10415. Infopaq International (C-5/08) [2009] ECR 1–6569. UsedSoft v Oracle International (C-128/11) [2012] ECR I-0000; 3 July 2012, not yet published. See also Cases at Art. 3.

3. Bibliography Gaster, J. Der Rechtschutz von Databanken, Carl Heymanns, Cologne, 1999. See also Bibliography at Arts 1 and 4.

ARTICLE 6: EXCEPTIONS TO RESTRICTED ACTS 1.

2.

3.

The performance by the lawful user of a database or of a copy thereof of any of the acts listed in Article 6 which is necessary for the purposes of access to the contents of the databases and normal use of the contents by the lawful user shall not require the authorisation of the author of the database. Where the lawful user is authorized to use only part of the database, this provision shall apply only to that part. Member States shall have the option of providing for limitations on the rights set out in Article 5 in the following cases: (a) in the case of reproduction for private purposes of a non-electronic database; (b) where there is use for the sole purpose of illustration for teaching or scientific research, as long as the source is indicated and to the extent justified by the noncommercial purpose to be achieved; (c) where there is use for the purposes of public security or for the purposes of an administrative or judicial procedure; (d) where other exceptions to copyright which are traditionally authorised under national law are involved, without prejudice to points (a), (b) and (c). In accordance with the Berne Convention for the protection of Literary and Artistic Works, this Article may not be interpreted in such a way as to allow its application to be used in a manner which unreasonably prejudices the rightholder’s legitimate interests or conflicts with normal exploitation of the database.

I. COMMENTARY 1. Paragraph 1 9.27 Paragraph 1, in much the same way as the Software Directive, ensures that the lawful user can access and use the database’s contents normally. Otherwise, each time the user, for instance, inserted a CD-ROM in his or her computer, s/he would breach the right of reproduction as it includes temporary reproduction and the act of inserting a CD-ROM automatically makes a temporary copy in the computer’s memory. The user however has to be a lawful one. The concept of ‘lawful user’, which also appears in the Software Directive, is not defined. It is a concept which applies also to the sui generis right (see below, Arts 8 and 9) and will be discussed there. Strangely, however, only paragraph 1 imposes the requirement of a lawful user.44 This contrasts sharply with the corresponding exceptions in the Software Directive (Arts 5(1) and the other exceptions (5(2)

44

A-M. Beunen, The European Database Directive and its Effects in the Netherlands, France and the United Kingdom, Wolf Legal Publishers, Nijmegen, 2007, 93.

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and 5(3)) and 6) and the sui generis right (Arts 8 and 9). The exception provided in Article 6(1) is mandatory; Member States do not have an option as to whether or not they implement it.

2. Paragraph 2 Paragraph 2 sets out three exceptions Member States are free to include or not in their national 9.28 laws. They more or less mirror those under the sui generis right (see below, Arts 8 and 9). These three defences are optional so Member States are not obliged to implement them. Paragraph 2(d) allows Member States to retain existing exceptions applicable to databases if they wish to.45 It is not entirely clear whether these traditional exceptions can also include those in the list enacted in Article 5 of the InfoSoc Directive.46 If a Member State included an exception which did not exist in its law before the adoption of the database and the InfoSoc Directive, but may have been a traditional exception in other Member States (and thus appearing in the list of Article 5 of the InfoSoc Directive), it would breach Article 1(2) of the InfoSoc Directive. Therefore, a Member State would not be able to implement such an exception for databases.

3. Paragraph 3 Paragraph 3, like Article 5(5) of the InfoSoc Directive, is a reminder that when Member States 9.29 implement the exceptions, they must respect the three-step test. Normally, the Database Directive must already respect the test since otherwise it would breach the Berne Convention and the WIPO Copyright Treaty. Nevertheless, paragraph 3 remains important for those traditional exceptions targeted in paragraph 2(d).

4. Other copyright aspects not regulated by the Database Directive As can be seen from the above, the copyright chapter of the Database Directive is silent on a few 9.30 aspects of copyright law (the right of rental and lending was an example discussed above under Art. 5). The term of protection is not indicated in the Database Directive but is regulated by the Term Directive (see Recital 25). Moral rights are outside the scope of the Directive and thus remain regulated at national level and by international conventions (Recital 28). Note that new exceptions will have to be added in 2021 as a result of implementing the Directive on copyright in the digital single market.47 The provisions are the same for the copyright and sui generis right. See below paragraph 9.68 of this chapter.

NOTES 1. Related instruments Berne Convention for the Protection of Literary and Artistic Works last amended on 28 September 1979. Council Directive 91/250/EEC of the European Parliament and of the Council of 14 May 1991 on the legal protection of computer programs, OJ L 122/42, 17.5.1991. Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001.

45

46 47

Beunen, 99 argues that ‘it is not clear whether art. 6(2)(d) implies that the traditional copyright exceptions automatically apply to copyrighted databases or whether this provision requires national legislators to actively implement the traditional exceptions explicitly for databases’. She favours the first approach, as do I. Ibid. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC, OJ L 130/92.

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Chapter 9 THE DATABASE DIRECTIVE Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights, OJ L 290/12, 24.11.1993. World Copyright Treaty (WCT) of December 20 1996. See also Instruments at Art. 2.

2. Bibliography Beunen, A.-M. The European Database Directive and its Effects in the Netherlands, France and the United Kingdom, Wolf Legal Publishers, Nijmegen, 2007. See also Bibliography at Arts 4 and 8.

CHAPTER III SUI GENERIS RIGHT ARTICLE 7: OBJECT OF PROTECTION 1.

2.

3. 4.

5.

Member States shall provide for a right for the maker of a database which shows that there has been qualitatively and/or quantitatively a substantial investment in either the obtaining, verification or presentation of the contents to prevent extraction and/or re-utilization of the whole or of a substantial part, evaluated qualitatively and/or quantitatively, of the contents of that database. For the purposes of this Chapter: (a) “extraction” shall mean the permanent or temporary transfer of all or a substantial part of the contents of a database to another medium by any means or in any form; (b) “re-utilisation” shall mean any form of making available to the public all or a substantial part of the contents of a database by the distribution of copies, by renting, by on-line or other forms of transmission. The first sale of a copy of a database within the Community by the rightholder or with his consent shall exhaust the right to control resale of that copy within the Community; Public lending is not an act of extraction or re-utilisation. The right referred to in paragraph 1 may be transferred, assigned or granted under contractual licence. The right provided for in paragraph 1 shall apply irrespective of the eligibility of that database for protection by copyright or by other rights. Moreover, it shall apply irrespective of eligibility of the contents of that database for protection by copyright or by other rights. Protection of databases under the right provided for in paragraph I shall be without prejudice to rights existing in respect of their contents. The repeated and systematic extraction and/or re-utilisation of insubstantial parts of the contents of the database implying acts which conflict with a normal exploitation of that database or which unreasonably prejudice the legitimate interests of the maker of the database shall not be permitted.

I. COMMENTARY 1. The nature of the sui generis right 9.31 The Directive does not expressly state that the sui generis right is an intellectual property right. It is important to ascertain the nature of the sui generis right because if it is an intellectual property right, it determines its relationship to other laws such as unfair competition and contract laws (on this, see below Art. 13). It is clear that the sui generis right is not a tort (an action in unfair competition) but

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is a property right as Article 7(3) states it can be licensed and transferred. In addition, the principle of exhaustion is provided as in other intellectual property laws (Art. 7(2)(b)). Exceptions to the rights are provided and the right has a term of protection, like other intellectual property rights. All these point to the conclusion that the sui generis right is an intellectual property right. The overwhelming majority of commentators classify it as an intellectual property right48 and many Member States have classified it as a neighbouring right in their national laws. It is also clear that the sui generis right is not (part of) copyright.49

2. Reasons for the sui generis right There are three main reasons why the sui generis right was adopted. First, the main investment in a 9.32 database is in its contents. However, copyright does not protect the contents but only the database’s structure. So taking the contents without the structure would not infringe. An additional protection was necessary to protect the contents. A second reason was to boost’s Europe’s database industry to compete with, among others, the United States (Recitals 11 and 12). Thirdly, while unfair competition could have been used to protect the contents of databases, it would have probably entailed a full-blown harmonisation of national unfair competition laws and some Member States could not agree to that. A quick fix was needed and creating a new intellectual property right was far easier than attempting to harmonise unfair competition laws.

3. Protection requirement: qualitative or quantitative substantial investment in the obtaining, verification or presentation of the database’s contents A. Investment The investment can be financial, material or human. Financial investment is self-explanatory. 9.33 Human investment can be in time, effort or energy whereas material investment refers to the acquisition of equipment to build the database. So investments which cannot readily be quantifiable in money, such as human investments, can qualify a database for protection. The ECJ confirmed this when defining the term ‘qualitatively’.50 B. Public sector databases Following the option in Article 2(4) of the Berne Convention, many Member States’ copyright laws 9.34 exempt official works or at least texts. There is no such provision in the Database Directive but it poses the question whether databases made by any of the three branches of state power, at local or national level, can benefit from the sui generis right; indeed, it is disputable that there is risk, hence an investment, because they are paid with taxpayer’s money.51 The German Supreme Court held

48

49

50 51

See e.g. G. Karnell, ‘The European sui generis protection of databases: Nordic and UK law approaching the Court of the European Communities – Some comparative reflections’, (2002) Journal of the Copyright Society of the USA, 998; V. Bensinger, Sui generis Schutz für Databanken, Die EG-Datenbank Richtlinie vor dem Hintergrund des nordischen Rechts, Beck, Munich, 1999, 111ff; Gaster, 118 ff., no. 457 ff.; P.B. Hugenholtz, ‘De databankrichtlijn eindelijk aanvaard: een zeer kritisch commentaar’, (1996) Computerrecht, 131, 134. For more references, see Derclaye, 2008, 52. For more details, see Derclaye, 2008, 52. In short, the Explanatory Memorandum to the Directive (para. 1.2., 41) clearly states that the sui generis right is ‘not a copyright right’. The Directive makes a clear distinction between copyright (Ch. II) and the sui generis right (Ch. III). The reciprocity clause (Art. 11) and the fact that the Berne Convention does not apply prove it as well. See below. E. Derclaye, ‘Does the Directive on the re-use of public sector information affect the State’s database sui generis right?’, in J. Gaster, E. Schweighofer and P. Sint (eds), Knowledge Rights – Legal, Societal and Related Technological Aspects, Austrian Computer Society, Vienna, 2008; C. Sappa, ‘Public sector databases – the contentions between sui generis protection and re-use’, (2011) Computers and Telecommunications Law Review c.T.L.R, 17(8), 217 (citing decisions discussing whether the sui generis right subsists in public sector databases).

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that databases eligible for the sui generis right, which are official works, should be exempted from protection by analogy with the copyright act’s exemption for official works.52 The Supreme Court posed a question to the CJEU but later withdrew it so that this issue is still unclear at EU level.53 9.35 Article 1(6) of the Directive on open data and the re-use of public sector information, which Member States must transpose by 17 July 2021, provides that, ‘The right for the maker of a database provided for in Article 7(1) of Directive 96/9/EC shall not be exercised by public sector bodies in order to prevent the re-use of documents or to restrict re-use beyond the limits set by this Directive.’54

C. Substantial 9.36 There is no indication of the level of investment in the Directive except that Recital 19 states that usually, owing to too little investment, a compilation of recordings of musical performances on a CD should not be able to qualify as a database. All that one can glean from this therefore is that the level of investment must be more than minimal. Nevertheless, because the term ‘substantial’ is vague, and thus can be interpreted strictly or broadly, it leads to uncertainty.55 The CJEU has not yet had to decide this issue. In the national courts, there is generally no dispute on this point as the level of investment is high. But some courts have had to grapple with minimal investments and rejected sui generis right protection in some cases.56 Commentators are split on the issue but generally, national courts have been generous and granted protection for relatively low-level investments.57

D. Qualitatively and quantitatively 9.37 The Directive does not define the terms ‘quantitatively’ and ‘qualitatively’. The CJEU has given some guidance in respect of those terms: ‘[t]he quantitative assessment refers to quantifiable resources and the qualitative assessment to efforts which cannot be quantified, such as intellectual effort or energy, according to the 7th, 39th and 40th recitals […]’.58 Therefore, a quantitatively substantial investment refers to the amount of money and/or time invested in the database while a qualitatively substantial investment refers to the effort and/or energy invested in the database. Thus ‘quantitatively’ does not refer to the quantity of data in the database, nor the quantity of the investment but rather to the type of investment (financial). A consequence of this is that if the arrangement of the data is original and represents a qualitatively substantial investment, then there

52 53

54

55 56

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Saechsiger Ausschreibungsdiesnt, 28 September 2006 (2007) GRUR 500; (2007) GRUR Int. 532; Case C-215/07 Schawe v Saechsiches Druck- und Verlagshaus [2007] OJ C-155/12. S. von Lewinski, ‘Chronique d’Allemagne – 2e partie: L’évolution du droit d’auteur en Allemagne de mi-2005 à fin 2010’, (2011) Revue internationale du droit d’auteur, 229, 239. For the situation in the Netherlands, see M. van Eechoud, ‘Government works’, in P.B. Hugenholtz, A Quaedvlieg and D. Visser (eds), A Century of Dutch Copyright Law, Auteurswet 1912–2012, deLex, Amsterdam, 2012. Directive (EU) 2019/1024 of the European Parliament and of the Council of 20 June 2019 on open data and the re-use of public sector information OJ L172/56. For context and more information, see . See e.g. M. Leistner, ‘Legal protection for the database maker: Initial experience from a German point of view’ (2002) IIC 957; Sanks, 998; Pollaud-Dulian, 540. For more references, see Derclaye, 2008, 75. See e.g. AMC Promotion v CD Publishers Construct Data Verlag GmbH, T. Com. Paris, 16 February 2001, cited by C. Caron, ‘Liberté d’expression et liberté de la presse contre droit de propriété intellectuelle’, (2002) Communication Commerce Electronique, 2, 25 (classifying data alphabetically is not sufficient); Datenbankeigenschaft von Hyperlinksammlungen, AC Rostock, 20 February 2001, available on (very simple collections of data are not protected, for example a small private collection of addresses) (accessed 11 February 2013). For more details, see Derclaye, 2008, 76 ff. Case C-338/02 Fixtures Marketing Ltd v AB Svenska Spel [2004] ECR I-10549 (Svenska Spel), para. 28; (C-444/02) OPAP, para. 43; Case C-46/02, Fixtures Marketing Ltd v Oy Veikkaus AB [2004] ECR I-10497 (Veikkaus), para. 38.

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is a coincidence between a qualitatively substantial investment and originality.59 In this case, two types of protection (copyright and sui generis right) attach to the same aspect of the database. This can generate problems as the sui generis right and copyright provisions sometimes clash.

E. Obtaining The CJEU has held that the term ‘obtaining’ encompasses only the collection of the data and not its 9.38 creation.60 This ensures that spin-off databases, i.e. databases which are the by-products of main activities, are rarely protected by the sui generis right and avoids monopolies on information. Only where there is a separate substantial investment in gathering the created data can the sui generis right attach to the database.61 As it is often difficult to prove such separate investment, the sui generis right will rarely protect sole source databases.62 The Court did not give an answer regarding data recorded from nature (e.g. meteorological). Commentators are split on the issue. Some think the Court would hold that recording data is creating data rather than obtaining it.63 Other commentators think recording data is collecting it.64 In the Précom case, the French Court of Cassation, which was for the first time asked to deal with 9.39 the issue of the distinction between creating and collecting data, clearly endorsed the CJEU rulings.65 In that case, the claimant created a website with advertisements of properties for sale and the defendant published some of the claimant’s advertisements in its newspaper aimed at estate agents. The French Supreme Court held that the investment was in the creation of the adverts and that the verification took place during creation and was purely formal. The Court expressly stated that a company cannot claim the benefit of the protection by the sui generis right for investments linked with the creation of the content of a database. Despite these positive developments on the verification of the investment’s object, the Court of Cassation may have created some doubt with its later Lectiel decision.66 In this case, the Supreme Court confirmed the Paris court of appeal’s decision that France Télécom’s list of subscribers (telephone directory) was a protected database. The defendant argued that there was no investment. But the court of appeal held that France Télécom’s telephone directory did not simply consist of its subscribers’ names, addresses and numbers but had much more information than that, half of it coming from France Télécom. Whereas the appellate court noted that the database was not simply a collection of all France Télécom’s telephone directories but that there was, in relation to the copyright claim, some ‘presentation effort’,67 it did not specifically state whether there was a substantial investment in the

59 60 61 62

63 64

65

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Davison, 84. Case C-338/02 Svenska Spel, para. 24; Case C-203/02 BHB, para. 31; Veikkaus, para. 34; OPAP, para. 40. Case C-338/02 Svenska Spel, paras 29–30; OPAP, paras 45–6. See e.g. NVM v Zoekallehuizen.nl, Pres. Arr. Arnhem, 16 March 2006, upheld by CA Arnhem, 4 July 2006, available at (accessed 11 February 2013). Bygrave, 31. O.-A. Rognstad, Opphavsrett, Universitetsforlaget, Oslo, 2009, 302–3; M. Leistner, ‘British Horseracing Board v. William Hill’, (2005) International Review of Intellectual Property and Competition Law, 36, 592, 594; Kur et al., ‘First evaluation of Directive 96/9/EC on the legal protection of databases’, (2006) International Review of Intellectual Property and Competition Law, 37, 551, 556; E. Derclaye, ‘Databases sui generis right: Should we adopt the spin-off theory?’ (2004), European Intellectual Property Review, 402, 411–12. Précom, Ouest France Multimedia v Direct Annonces, Court of Cassation (Cass.), 1st civ., 5 March 2009, available on and ; (2009) 221 Revue Internationale du Droit d’Auteur 491 (accessed 11 February 2013). Lectiel v France Télécom, Cass. (Chambre commerciale, financière et économique), 23 March 2010, (2010) 225 Revue Internationale du Droit d’Auteur 373, available on or (accessed 11 February 2013). ‘Qu’elles sont donc le résultat d’un effort de recherche, de sélection et de synthèse dans l’agencement des données justifiant d’un apport intellectuel et créateur de son auteur au sens de l’article L. 112–3 du code de la propriété intellectuelle.’

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collection, verification or presentation of the data separate from data creation in relation to the sui generis right claim. It is strange therefore that the Court of Cassation confirmed the appellate decision. But it may be explained by procedural matters (such as the defendant not raising this point in its appeal to the Supreme Court) or by the agreement of the parties with the expert who gave an opinion as to the investment made in the database. The appellate court relied heavily on this expert statement. The Lectiel decision is therefore not entirely conclusive. Presumably therefore, the Court’s Précom ‘precedent’ still stands. 9.40 In a similar vein, in Germany, the Supreme Court reversed an appellate court’s decision for assuming database right without checking whether it was a database and whether there was a substantial investment and remanded the decision to the court of appeal to check these issues.68 In Ryanair v Atrapalo, the Spanish Supreme Court also scrupulously followed the CJEU case law and held that Ryanair’s web site was a database but was not protected by the sui generis right, because the investment was in the creation of data and of software, and not on their acquisition.69 9.41 In another case, the German Supreme Court held that the investment in acquiring a database or in the payment of a licence to use a database does not count for the requirement of a substantial investment. However, in that case, the claimant had made substantial investment in presenting the data so it benefited from the sui generis right.70

F. Verification 9.42 The term ‘verification’ means ensuring the reliability of the information contained in the database, monitoring the accuracy of the materials collected when the database was created and during its operation.71 This will include checking, correcting and updating the contents since these are ways of ensuring the contents’ reliability.72 Even if the database remains the same (the elements are not changed) as a result of the verification, it is still possible to prove a substantial investment.73 G. Presentation 9.43 The CJEU held that investment in presenting refers to ‘the resources used for the purpose of giving the database its function of processing information, that is to say those used for the systematic or methodical arrangement of the materials contained in that database and the organisation of their individual accessibility’.74 Presentation refers to the structuring or organisation of the data as well as the way the contents are made accessible to the users. This includes the creation of an index or thesaurus. 4. Ownership 9.44 Strangely, the Directive does not have a provision on ownership of the sui generis right. Recital 41 only provides minimally that the database maker is ‘the person who takes the initiative and the risk of investing’. The defining issue is who is making the substantial investment. The database maker, or producer as it is often also called, can be an individual or legal entity. There is no provision either

68 69 70 71 72 73

74

Bundesgerichtshof (Market Surveys) (I ZR 1/02) (2005) GRUR 940 (Germany) reported in Case Comment, Germany: Copyright Act, secs. 17(2), 87a(1), 87(1) and (2) – ‘Market Surveys’ [2006] IIC 489. Case STS 572/2012, 9 October 2012, available at . Elektronischer Zolltariff, 30 April 2009 (2009) GRUR 852, reported by von Lewinski, 241. Case C-338/02 Svenska Spel, para. 27. Hugenholtz, 135. British Horseracing Board v William Hill [2001] RPC 612, para. 35; Recital 55 also provides that if substantial investment is put into ensuring the database is accurate, even if the contents do not change, it is protected by the sui generis right. Case C-338/02 Svenska Spel, para. 27.

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regarding databases made by employees but Recital 41 states that subcontractors in particular are excluded from the definition of maker. Apart from this restriction, therefore, Member States are free to have a rule of ownership giving the right to the employer or to the employee (similar to Art. 4, above). The Directive is silent on joint ownership but much of the literature argues the Directive makes it possible.75 These issues of ownership by employees, commissionees and joint owners are therefore entirely left to national laws and vary a lot.76 For instance, the British legislature implemented this possibility explicitly.

5. The rights The two terms ‘extraction’ and ‘re-utilisation’ must be interpreted in the light of the objective 9.45 pursued by the sui generis right which is, according to Recital 42, to protect the database maker against acts by users which go beyond the users’ legitimate rights and harm the database maker’s investment77 and according to Recital 48, to secure the remuneration of the database maker.78 The terms extraction and re-utilisation must be interpreted widely because the legislator used the expressions ‘by any means or in any form’ and ‘any form of making available to the public’.79 Therefore, it is irrelevant that the act of extraction or re-utilisation is not made in order to create a competing database.80 Because the two concepts of extraction and re-utilisation are meant to be wide, they also include any indirect taking.81 As defined by the Directive and interpreted by the CJEU, the two rights are very close to the rights of reproduction and communication to the public in copyright law. Nevertheless, there are not the same as is explained below.

A. Extraction Extraction includes both removal and copying of the contents. It is therefore broader than the 9.46 copyright concept of reproduction. Extraction therefore includes copying, e.g. writing down by hand, typing on a computer or any machine, scanning a paper database, as well as downloading, printing or any other reproduction in whatever (permanent or temporary) form.82 In Apis, the Court had to construe ‘temporary’ and ‘permanent transfer’ for the purpose of determining whether restricted acts of extraction and re-utilisation had taken place. It held that a transfer will count as a ‘permanent transfer’ only if the data is stored in a permanent manner in a medium other than the database for more than a limited period of time after extraction. The objective pursued by the act of transfer (e.g. creating another database whether or not competing) is immaterial for the purposes of

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77 78 79 80 81

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Beunen, 155 and references therein. For extensive details of national implementations and the literature’s views, see Beunen, 146ff; M. Košcˇík, and M. Myška, ‘Database authorship and ownership of sui generis database rights in data-driven research’ (2017) 31(1) International Review of Law, Computers & Technology 43. Case C-203/02 BHB, para. 45. Ibid, para. 46. Ibid., para. 51. Ibid., para. 47. Ibid., para. 53; Re a Musical Hits Database (Hit Bilanz), Case I ZR 290/02, 21 July 2005, available on http:// juris.bundesgerichtshof.de/cgi-bin/rechtsprechung/document.py?Gericht=bgh&Art=en&sid=1e4bf9 38b9f4bcc4ad206 4183135ec6e&client=3&nr=33566&pos=0&anz=6 (accessed 11 February 2013); Marktstudien, BGH, 21 April 2005, I ZR 1/02 [2006] IIC 489 (reproduction of data from surveys in a magazine). See e.g. Hugenholtz, 135; confirmed by Directmedia, para. 60: The transfer of material from a protected database to another database following an on-screen consultation of the first database and an individual assessment of the material contained in that first database is capable of constituting an ‘extraction’. The case concerned a database of poems. On remand in Directmedia, the German Supreme Court followed the CJEU on the interpretation of extraction and considered that extracting 75 per cent of the titles of poems was extracting a substantial part. See von Lewinski, 239.

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assessing whether there has been an extraction.83 Extraction does not cover mere consultation of the database.84 This is only valid for non-electronic databases as consulting electronic ones always involves a temporary reproduction.85 The CJEU also held that it is irrelevant for the purposes of infringement that the data extracted is rearranged in another way; there will still be an extraction.86 Here the Court has overlooked the fact that if the substantial investment is solely in the presentation of the data, it is doubtful there could be infringement if the data extracted is rearranged in a different way. It seems that extraction also includes translation. Since the extraction can be in any form, a translation of the database’s contents would be an extraction. The ECJ has not given guidance in this respect; it just held that the term ‘extraction’ is wide. However, certain commentators disagree and believe that if extraction includes translation, it creates a new right not envisaged in the Directive.87

B. Re-utilisation 9.47 Re-utilisation is also a broad concept encompassing all forms of making the database available to the public. The communication can be made on-line (e.g. on a website) or on an analogue medium, by wire or wireless means. It can be direct or indirect.88 The German Supreme Court interpreted this concept broadly in a case involving reuse of a database where the defendant sent substantial parts of the claimant’s database to individual users. If individual users can constitute a public, then the defendant infringes.89 9.48 Later, the CJEU held that the nature and form of the process used to extract and re-utilise are irrelevant.90 Therefore, re-utilisation also includes sending, by means of a web server, to another person’s computer, at that person’s request, data previously extracted from a database protected by the sui generis right.91 Re-utilisation also includes the activity of meta search engines, which scrape websites according to users’ queries and present all the hits in one place.92 Such scraping is a re-utilisation because it ‘is not limited to indicating to the user databases providing information on a particular subject’ but it: provides any end user with a means of searching all the data in a protected database and, accordingly, […] provide[s] access to the entire contents of that database by a means other than that intended by the maker of that database, whilst using the database’s search engine and offering the same advantages as the database itself in terms of searches.93

The Court concluded that a meta search engine re-utilises the whole or a substantial part of the contents of a database and thus infringes the sui generis right where it:

83

84 85 86 87 88 89 90 91 92

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BHB, para. 47; Directmedia, paras 46 and 47; Apis, para. 55. The German Supreme Court followed this in Re a Musical Hits Database (Hit Bilanz), Case I ZR 290/02, 21 July 2005 [2006] ECC 31 and Re Database Rights, Case I ZR 159/10, 22 June 2011 [2012] ECC 20. BHB, paras 54–55; Directmedia, para. 53. Directmedia, para. 53. Ibid., para. 39; Apis, para. 55. The German Supreme Court followed this in Re a Musical Hits Database (Hit Bilanz), Case I ZR 290/02, and Re Database Rights, Case I ZR 159/10, 22 June 2011 [2012] ECC 20. Karnell, 997. BHB, para. 67. 25 March 2010 (2010) GRUR 1004 reported by von Lewinski, 243. Case C-173/11, Football Dataco Ltd v Sportradar GmbH [2013] 1 C.M.L.R. (29) 903. Ibid., para. 21. Case C-202/12, Innoweb BV v. Wegener ICT Media BV, Wegener Mediaventions BV, ECLI:EU:C:2013:850. For commentary, see S. Vousden, ‘Innoweb, Search-Engines and Engineering Legitimacy in EU Law’, [2014] I.P.Q. 280–306. Ibid., paras 39–40.

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ARTICLE 7: OBJECT OF PROTECTION provides the end user with a search form which essentially offers the same range of functionality as the search form on the database site; ‘translates’ queries from end users into the search engine for the database site ‘in real time’, so that all the information on that database is searched through; and presents the results to the end user using the format of its website, grouping duplications together into a single block item but in an order that reflects criteria comparable to those used by the search engine of the database site concerned for presenting results.94

i.

Exhaustion

As in copyright law, it is clear that the exhaustion principle does not allow the reproduction of data. 9.49 The German Supreme Court has confirmed this: it held that if there is extraction of a substantial part of the database, there is no exhaustion as exhaustion covers the right of distribution and not of extraction.95 As in the above discussion under Article 5, online electronic databases cannot benefit from the exhaustion principle. The database must have been sold. If it is given free of charge, the principle of exhaustion does not apply. The CJEU held this to be so in the field of trademarks in Peak Holding v Axolin-Elinor and later confirmed it in L’Oréal v eBay.96 There is no reason why these decisions would not apply here by analogy as the term used in Article 7(2)(b) is ‘sale’. The same applies to Article 5(c) in the copyright chapter of the Database Directive.

C. Public lending Contrary to copyright law, public lending is not a restricted act. Thus a public establishment such as 9.50 a library can freely lend a database solely protected by the sui generis right. Note that the wording of the Directive is clumsy: an act of public lending cannot be an extraction anyway.97 It can only be an act of re-utilisation. 6. Infringement 9.51

Three paragraphs of Article 7 deal with infringement: paragraphs 1, 4 and 5.

A. Paragraph 1 The Directive does not define the terms ‘substantial part’, ‘insubstantial part’, ‘quantitative’ and 9.52 ‘qualitative’. The CJEU interpreted these four terms in 2004.98 It held that the assessment in qualitative and quantitative terms of whether a part is substantial must refer to the investment in the creation of the database and the prejudice caused to that investment by the act of extraction or re-utilisation.99 In other words, there must be a link between the part extracted or re-utilised and the investment made by the database maker in that part. Thus if the user takes a substantial part which does not represent the substantial investment of the database maker, the investment is not harmed and there cannot be infringement, even if there was an act of extraction or re-utilisation. A ‘substantial part evaluated quantitatively’ refers to the volume of the data extracted or re-utilised from the database and it must be assessed in relation to the volume of the contents of the whole of the database.100 The expression ‘a qualitatively substantial part’ refers to the scale of investment in the obtaining, verification or presentation of the contents of the subject of the act of extraction

94 95 96 97

98 99 100

Ibid., para. 54. Marktstudien (Market Surveys), 21 April 2005, Case I ZR 1/02 (2005) GRUR 940; [2006] IIC 489. Case C-16/03 Peak Holding v Axolin-Elinor [2004] ECR I-11313 and Case C-324/09 L’Oréal v eBay [2011] ETMR 52. A. Lucas, H.J. Lucas and A. Lucas-Schloetter, Traité de la propriété littéraire et artistique, 4th ed., Litec, Paris, 2012, 979, n. 1190; P. Gaudrat, ‘Loi de transposition de la directive 96/9 du 11 mars 1996 sur les bases de données: les caractères du droit sui generis ’, (1999) RTD com, 52(2), 398, 410. BHB, paras 68ff. Ibid., para. 69. Ibid., para. 70. See also Speyeart, 174.

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and/or re-utilisation, regardless of whether that subject (or part) represents a quantitatively substantial part of the contents. This is because a quantitatively negligible part may represent in terms of obtaining, verifying or presenting the contents, a significant human, technical or financial investment.101 The intrinsic value of the materials affected by the acts of extraction or re-utilisation does not constitute a relevant criterion for the assessment of whether a part is substantial.102 The Court also ruled that a part which does not fulfil the requirement of a substantial part is automatically an insubstantial part.103 9.53 In the Apis case, which concerned a legal database consisting of several sub-databases, the CJEU held that one has to first assess if each module is an independent database (does it fit in the definition and is there substantial investment). If the answer is positive, then it is against that database that substantiality must be assessed, not against the entire big database. Otherwise, a defendant could easily avoid infringing simply by referring to the big overarching database. When data is taken from several modules at once, then substantiality must be assessed relative to the entire database.104 The CJEU also held that even if part of the materials contained in a database are official and accessible to the public, the national court must still verify whether the materials allegedly extracted and/or re-utilised from that database constitute a substantial part of its contents.105 9.54 The CJEU has so far not given guidance as to what is a quantitatively substantial or insubstantial part in terms of percentages and it is doubtful it ever will. Some national courts held that if a majority of the elements are extracted and/or re-utilised, a quantitatively substantial part has been taken.106 Others considered 20 per cent a quantitatively substantial part.107 However, in Apis, the CJEU gave some evidential rules relating to infringement: The fact that the physical and technical characteristics present in the contents of a protected database made by a particular person also appear in the contents of a database made by another person may be interpreted as evidence of extraction within the meaning of Article 7 of Directive 96/9, unless that coincidence can be explained by factors other than a transfer between the two databases concerned. The fact that materials obtained by the maker of a database from sources not accessible to the public also appear in a database made by another person is not sufficient, in itself, to prove the existence of such extraction but can constitute circumstantial evidence thereof.108

B. Paragraph 4 9.55 Paragraph 4 means several things. First, a database’s sui generis right adds up to the potential copyright subsisting in its structure but also any rights, including copyright, subsisting in its contents. Conversely, even if a database cannot acquire copyright on its structure, the sui generis right can subsist if the conditions of the sui generis right are fulfilled. Also even if the contents are not protectable by any rights as such, the sui generis right can subsist if its conditions are fulfilled. In effect, a database is a multi-layered animal, it can be protected both by the sui generis right and copyright or by either of them. In addition, its contents can be protected or not by copyright or

101 102 103 104 105 106 107

108

Ibid., para. 71. Ibid., para. 72. This criterion had been criticised, see Lucas and Lucas, 982, n. 1196 citing Gaudrat, 401–2. BHB, para. 73. Apis, para. 74. Ibid. Wegener v Hunter Select, CA Leeuwarden, 27 November 2002, available on (50 out of 90 elements constituted a substantial part of the database) (accessed 11 February 2013). Credinfor v Artprice.com, CA Paris, 18 June 2003, Jurisdata, n. 223155 (the extraction of information containing the name, first name, date of birth and death of more than 36,000 artists is a quantitatively substantial extraction of the contents of a database related to the market of works of art containing information on 184,000 artists). Para. 55.

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ARTICLE 7: OBJECT OF PROTECTION

other rights. Moreover, the sui generis right shall apply irrespective of eligibility of the contents of that database for protection by copyright or by other rights. The third sentence means that the sui generis right cannot prevent a user of a copyright work, which forms part of the contents of the database, from benefiting from the exceptions which attach to this copyright work.

C. Paragraph 5 9.56

As the CJEU said: The purpose of article 7(5) of the Directive is to prevent circumvention of the prohibition in article 7(1) of the Directive. Its objective is to prevent repeated and systematic extractions and/or re-utilisations of insubstantial parts of the contents of a database, the cumulative effect of which would be to seriously prejudice the investment made by the maker of the database just as the extractions and/or re-utilisations referred to in article 7(1) of the Directive would.109

In other words, the insubstantial parts must altogether represent a substantial part or the whole database for Article 7(5) to be infringed. According to some, the Court must also have meant that it is irrelevant if all the insubstantial takings constituting a substantial part are not thereafter retained or being used.110

NOTES 1. CJEU case law Apis-Hristovich EOOD v Lakorda AD (C-545/07) [2009] ECR I-1627. British Horseracing Board, The v William Hill Organization (C-203/02) [2004] ECR I-10415. Directmedia Publishing v Albert-Ludwigs-Universität Freiburg (C- 304/07) [2008] ECR I-7565. Fixtures Marketing Ltd v AB Svenska Spel (C-338/02) [2004] ECR I-10549 (Svenska Spel). Fixtures Marketing Ltd v Oy Veikkaus AB (C-46/02) [2004] ECR I-10497 (Veikkaus). Innoweb BV v Wegener ICT Media B.V., Wegener Mediaventions BV, (C-202/12), pending. L’Oréal v eBay (C-324/09) [2011] ECR I-06011. Peak Holding v Axolin Elinor (C-16/03) [2005] ECR I-11313. See also Cases at Art. 5.

2. Bibliography Aplin, T. Copyright Law in the Digital Society, The Challenges of Multimedia, Hart, Oxford, 2005. Bensinger, V. Sui generis Schutz für Databanken, Die EG-Datenbank Richtlinie vor dem Hintergrund des nordischen Rechts, Beck, Munich, 1999. Caron, C. ‘Liberté d’expression et liberté de la presse contre droit de propriété intellectuelle’, (2002) Communication Commerce Electronique, 2, 25. Derclaye, E. ‘Databases sui generis right: Should we adopt the spin-off theory?’ (2004) European Intellectual Property Review, 402. Derclaye, E. ‘The Court of Justice interprets the data base sui generis right for the first time’, (2005) European Law Review, 420. Derclaye, E. ‘Database sui generis right: What is a substantial investment? A tentative definition’, (2006) International Review of Intellectual Property and Competition Law, 37, 2. Derclaye, E. ‘Does the Directive on the re-use of public sector information affect the State’s database sui generis right?’ in Gaster, J., E. Schweighofer and P. Sint (eds), Knowledge Rights – Legal, Societal and Related Technological Aspects, Austrian Computer Society, Vienna, 2008. Gaudrat, P. ‘Loi de transposition de la directive 96/9 du 11 mars 1996 sur les bases de données: les caractères du droit sui generis ’, (1999) RTD com, 52(2), 398.

109 110

BHB, para. 86. See also paras 87–88. T. Aplin, Copyright Law in the Digital Society, The Challenges of Multimedia, Oxford, Hart Publishing, 2005, 146.

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Chapter 9 THE DATABASE DIRECTIVE Hugenholtz, P.B. ‘De databankrichtlijn eindelijk aanvaard: een zeer kritisch commentaar’, (1996) Computerrecht 131. Karnell, G. ‘The European sui generis protection of data bases: Nordic and UK law approaching the Court of the European Communities – Some comparative reflections’, (2002) Journal of the Copyright Society of the USA, 983. Košcˇík, M. and Myška, M. ‘Database authorship and ownership of sui generis database rights in data-driven research’ (2017) International Review of Law, Computers & Technology, 31(1), 43. Kur, A. et al., ‘First evaluation of Directive 96/9/EC on the legal protection of databases’, (2006) International Review of Intellectual Property and Competition Law, 37, 551. Leistner, M. ‘British Horseracing Board v. William Hill’, (2005) International Review of Intellectual Property and Competition Law, 36, 592. Lucas, A. and H.-J. Lucas, Traité de la propriété littéraire et artistique, 2nd ed., Litec, Paris, 2001. Masson, A. ‘Creation of database or creation of data: Crucial choices in the matter of database protection’, (2006) European Intellectual Property Review, 261. Ritter, C. ‘Case Comment’, [2005] CMLR 125. Rognstad, O.-A. Opphavsrett, Universitetsforlaget, Oslo, 2009. Sappa, C. ‘Public sector databases – The contentions between sui generis protection and re-use’, (2011) Computers and Telecommunications Law Review, 17(8), 217. van Eechoud, M. ‘Government works’, in Hugenholtz, P.B., A. Quaedvlig and D. Visser (eds), A Century of Dutch Copyright Law, Auteurswet 1912–2012, deLex, Amsterdam, 2012. von Lewinski, S. ‘Chronique d’ Allemagne – 2e partie: L’évolution du droit d’auteur en Allemagne de mi-2005 à fin 2010’, (2011) Revue internationale du droit d’auteur, 229, 205. See also Bibliography at Arts 1 and 4.

ARTICLE 8: RIGHTS AND OBLIGATIONS OF LAWFUL USERS 1.

2. 3.

The maker of a database which is made available to the public in whatever manner may not prevent a lawful user of the database from extracting and/or re-utilising insubstantial parts of its contents, evaluated qualitatively and/or quantitatively, for any purposes whatsoever. Where the lawful user is authorised to extract and/or re-utilise only part of the database, this paragraph shall apply only to that part. A lawful user of a database which is made available to the public in whatever manner may not perform acts which conflict with normal exploitation of the database or unreasonably prejudice the legitimate interests of the maker of the database. A lawful user of a database which is made available to the public in any manner may not cause prejudice to the holder of a copyright or related right in respect of the works or subject matter contained in the database.

I. COMMENTARY 9.57 Article 8(1) is a mandatory provision giving a lawful user a right while Article 8(2) and 8(3) provide for lawful users’ obligations.

1. Concept of lawful user 9.58 Nowhere in the Directive is there a definition of ‘lawful user’. Only paragraph 52 of the Explanatory Memorandum gives a definition of the lawful user: ‘a person having acquired the right to use a database’. However this definition is tautological: it does not say how a user acquires the right to use a database which is the core of the problem.111 The CJEU has not interpreted the notion of lawful user in respect of databases but has done so in the UsedSoft case in relation to software. Prior to

111

V. Vanovermeire, ‘The concept of the lawful user in the Database Directive’, (2000) International Review of Intellectual Property and Competition Law, 62, 65.

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ARTICLE 8: RIGHTS AND OBLIGATIONS OF LAWFUL USERS

UsedSoft commentators had identified three possible interpretations: (1) the lawful user refers to any user relying upon exceptions provided by law or contract (this is the traditional copyright law approach and is the broadest),112 (2) the lawful user is only a licensee and (3) the lawful user is any user who lawfully acquires a database. This latter approach is in line with the approach of the Software Directive. Based on an interpretation of the Database Directive and preparatory materials, the correct interpretation is most probably the third one.113 Accordingly, a lawful acquirer can use a database or a licit copy of it as a result of an act or a contract that can be other than a licence: an act of public lending, a gift, a sale, a re-sale, a licence, inheritance114 or a rental contract. If a database is accessible free of charge and freely on the web, the database maker must have implied a licence to use the database within the limits of the Directive. Decisions involving freely accessible online databases seem to confirm this interpretation.115 This interpretation of a lawful user means that the majority of users would be lawful: users generally have access to databases through the internet, libraries, as an employee or student through a subscription made by the employer or the university or by simply borrowing a database privately or acquiring the database new or second-hand for a price or for free. Unlawful users would be those stealing a database incorporated in a tangible medium, or those subsequently acquiring a stolen or an infringing database (a pirated copy). It could also be persons using someone’s password to access a database or using, knowingly or not, a website unlawfully reproducing a protected database. In UsedSoft, the CJEU seemed to have confirmed this preferred third interpretation but it may have 9.59 adopted the broader first one. It held that buying a program downloaded online from the software manufacturer’s website, even under a so-called licence agreement, was a sale and that the person acquiring it from this first owner via a re-sale was a lawful acquirer.116 The CJEU expressly stated that ‘the argument […] that the concept of “lawful acquirer” in Article 5(1) of Directive 2009/24 relates only to an acquirer who is authorised, under a licence agreement concluded directly with the copyright holder, to use the computer programme cannot be accepted’ because it would render the exhaustion of the right of distribution ineffective.117 As it seems that all the different terms the Software and Database Directives use to refer to the concept of lawful user refer to the same user,118 the UsedSoft ruling should apply by analogy to database users. Some commentators have warned against a contract-based interpretation of the lawful user as it could allow abuse from right holders

112

113 114 115

116 117 118

In her footnote 43, T-E. Synodinou, ‘The lawful user and a balancing of interests in European copyright law’, (2010) International Review of Intellectual Property and Competition Law, 41(7) 819 refers to a Spanish decision District Court of O Porriño (Pontevedra), Programacion Integral v TLR Soft, 11 November 2002, available on ‘The Database Right File’ at (accessed 11 February 2013) (holding that there is lawful access and lawful use of an electronic database in case of use by the employee of the licensee). She also mentions (at 827–8) that the later InfoSoc Directive also refers to this broad interpretation in its Art. 5(1) and Recital 33 (‘a use should be considered lawful where it is authorised by the right holder or not restricted by law’). See Art. 6.2, Recitals 24 and 25 of the initial proposal and the Explanatory Memorandum. See also Software Directive, Arts 5 and 6. For more details, see Derclaye 2008, 124–5; Davison, 77–8; Vanovermeire, 80. S. Dusollier, ‘L’utilisation légitime de l’œuvre: un nouveau sésame pour le bénéfice des exceptions en droit d’auteur?’ (2005) Communication Commerce Electronique, November, 18; Synodinou, 834. See especially PR Line v Newsinvest, CA Versailles, 11 April 2002 [2002] CCE, July/August 2002, 20–22, comment Caron. The extraction made by Newsinvest fell into the scope of article L. 342–3 IPC (implementing Art. 8.1). The court did not discuss the meaning of lawful user but held that Newsinvest had lawful access to PR Line’s web site which was open to anyone for consultation and the extractions were quantitatively as well as qualitatively insubstantial. UsedSoft, paras 78–80. Ibid, paras 82–3. Synodinou, 824 referring to the Report from the Commission to the Council, the European Parliament and the Economic and Social Committee on the implementation and effects of Directive 91/250/EEC on the legal protection of computer programs, Brussels, 10 April 2000, COM(2000) 199 final, which states that Arts 6 and 8 of the Database Directive were modelled on Art. 5(1) of the Software Directive.

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but also from users. If such interpretation is favoured, Synodinou advocates the application of the private law’s principles of good faith and fair practice in the interpretation and performance of contracts.119

2. Paragraph 1 9.60 This paragraph is redundant and misleading. It is redundant because it is clear that a user may use insubstantial parts of a database without permission of the database maker. This is because the rights of extraction and re-utilisation only apply when the user extracts or reuses substantial parts. Therefore, the act of taking insubstantial parts (so long as it is not done repeatedly and systematically so as to reconstitute a substantial part of the database, which is prohibited under Article 7(5)) is outside the scope of the sui generis right. Article 8(1) is therefore not an exception. The paragraph states the obvious but it restricts the scope of a user’s right as the user must be lawful. As shall be seen below, a benefit of Article 8(1) is that a contract may not override it (Art. 15). The second sentence of Article 8(1) is self-explanatory.

3. Paragraph 2 9.61 This paragraph has been criticised for being vague and poorly drafted, thereby increasing the scope of the database maker’s right.120 It may also contradict paragraph 1. By definition, Article 8(2) can only apply to the use of insubstantial parts not of a substantial part. This is because extracting or re-utilising a substantial part will always be an infringement unless it falls within one of the exceptions provided in Article 9. Article 8(2) could mean that the lawful user who took an insubstantial part which she is allowed to do by law cannot do so if her act nevertheless conflicts with the normal exploitation of the database or unreasonably prejudices the legitimate interests of the maker of the database. This of course would depend on the facts of each case. The CJEU’s interpretation of Article 7(5) in 2004 seems to render Article 8(2) redundant. The sui generis right will only be infringed when a user takes insubstantial parts which together form a substantial part of the database. This wording echoes the three-step test (Art. 5(5) InfoSoc Directive).121

4. Paragraph 3 9.62 This paragraph simply means that the lawful user must respect copyright and related rights when extracting or re-utilising a work or other protected subject matter which forms part of the database. For instance, if a database is a collection of poems, the extraction or re-utilisation of one poem (whether it infringes or not the sui generis right in the database) must not prejudice the copyright subsisting in the poem in question.

NOTES 1. Related instruments Council Directive 91/250/EEC of the European Parliament and of the Council of 14 May 1991 on the legal protection of computer programs, OJ L 122/42, 17.5.1991. Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001. See also Related Instruments at Arts 1 and 5.

119 120 121

Synodinou, 835–8. Lucas and Lucas, 656, no. 835–1; F. Havelange, ‘Transposition de la directive européenne relative à la protection des bases de données’ (1998) Auteurs & Média 25, 26. See Synodinou for an up-to-date summary of the law on the test.

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ARTICLE: 9 EXCEPTIONS TO THE SUI GENERIS RIGHT

2. CJEU case law See case law at Art. 5.

3. Bibliography Dusollier, S. ‘L’utilisation légitime de l’œuvre: un nouveau sésame pour le bénéfice des exceptions en droit d’auteur?’ Communication Commerce Electronique, November 2005, 8. Havelange, F. ‘Transposition de la directive européenne relative à la protection des bases de données’, (1998) Auteurs & Média, 25. Synodinou, T.-E. ‘The lawful user and a balancing of interests in European copyright law’, (2010) International Review of Intellectual Property and Competition Law, 41(7), 819. Vanovermeire, V. ‘The concept of the lawful user in the Database Directive’, (2000) International Review of Intellectual Property and Competition Law, 62.

ARTICLE: 9 EXCEPTIONS TO THE SUI GENERIS RIGHT Member States may stipulate that lawful users of a database which is made available to the public in whatever manner may, without the authorisation of its maker, extract or re-utilise a substantial part of its contents: (a) (b) (c)

in the case of extraction for private purposes of the contents of a non-electronic database; in the case of extraction for the purposes of illustration for teaching or scientific research, as long as the source is indicated and to the extent justified by the non-commercial purpose to be achieved; in the case of extraction and/or re-utilisation for the purposes of public security or an administrative or judicial procedure.

I. COMMENTARY Article 9 provides for three optional exceptions. In other words, like those under the copyright 9.63 chapter, Member States can choose whether or not they implement them in their national laws. As the copyright exceptions and the sui generis right exceptions are virtually identical, they are discussed together here. The private reproduction (extraction for the sui generis right) exception is traditional in many 9.64 Member States’ copyright laws. There is an exact correspondence between this exception and the corresponding one in the copyright chapter (Art. 6(2)). The defence is based on the impossibility for the copyright holder to monitor such private uses and on the constitutional right of privacy of the home. However, the exception only applies to a non-electronic database. Private reproduction or extraction is not defined. There is no restriction as to where the act occurs. So a user does not have to exercise their exception in their home but could do so for instance in a library. The teaching and research exceptions in the two chapters are identical except on one crucial point: 9.65 in the sui generis right chapter, it is limited to extraction while in the copyright chapter (Art. 6(3)) the lawful user can ‘use’ a substantial part of the database, so the term is much broader and includes all restricted acts. The corresponding exception in the sui generis right chapter is therefore far more restricted and in effect quasi unusable since to teach and research one almost always has to communicate to the public. Apart from the acts that can be performed, the teaching and research exceptions apply in three cumulative conditions. There must be an illustration for teaching or scientific research, the source must be indicated and the illustration for teaching or research must not be for a commercial purpose. The Directive does not define ‘illustration for teaching’. It may be

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very restricted as it could mean that a substantial part of the database can be used only to give an example of what is being taught.122 The Directive states that the terms ‘scientific research’ relate to both the natural and human sciences.123 However, it does not define what research is. Some commentators think that research is ‘a diligent and systematic inquiry or investigation into a subject’.124 However, it is unclear whether it is so broad as the Directive restricts the defence to scientific research. The question is whether any research is scientific by definition. The Directive also does not explain what indication of the source means. Probably identifying the author (for copyright) or producer (for the sui generis right) is sufficient (by analogy with Art. 5(3) of the InfoSoc Directive). The condition of non-commercial purposes means that the research cannot be undertaken by a private company125 because by definition it has a commercial purpose. The situation of an educational establishment is less clear. Some will have a commercial purpose, some not. Some will have mixed commercial and non-commercial purposes, making the demarcation between commercial and non-commercial teaching and research difficult if not impossible.126 A charity should be able to benefit from the exception as it has a non-commercial purpose. 9.66 As to the last exception, there is an exact correspondence between Articles 6(2)(c) and 9(c). This exception is the broadest of all three since the user can both use (copyright) or extract and re-utilise (sui generis right) a substantial part of the database for purposes of public security or an administrative or judicial procedure and no condition of indication of source or non-commercial purpose is required.127 This exception has long existed in the realm of copyright.128 It is of crucial importance to the good functioning of justice that substantial parts of databases can be reused without the authorisation of the database maker to conduct administrative or judicial proceedings. The same is valid in respect of public security since urgent use of the database might be required and there is no time to wait for permission of the database maker. 9.67 Member States will have to implement the so-called Directive on copyright in the digital single market by 6 June 2021.129 This Directive added several exceptions to both copyright and the sui generis right in the same terms. Member States must provide an exception to most of the exclusive rights of both copyright and sui generis right holders for reproductions and extractions made by research organisations and cultural heritage institutions in order to carry out, for the purposes of scientific research, text and data mining of works or other subject matter to which they have lawful access (Art. 3) and also a general exception for text and data mining (Art. 4). Article 5 adds a new exception enabling the use of works and other subject matter in digital and cross-border teaching activities. Article 6 lays down an exception allowing ‘cultural heritage institutions to make copies of any works or other subject matter that are permanently in their collections, in any format or medium, for purposes of preservation of such works or other subject matter and to the extent necessary for such preservation’. Finally, Article 8 provides an exception for use of out-of-commerce works and other subject matter by cultural heritage institutions. The Directive does not allow parties to override the exceptions provided for in Articles 3, 5 and 6 by contract. This means that the general text and data mining exception can be overridden by contract.

122 123 124 125 126

127 128 129

Davison, 79. Recital 36. L. Bently and B. Sherman, Intellectual Property Law, 2nd ed., Oxford University Press, Oxford, 2004, 199. A. Strowel, ‘La loi du 31 août 1998 concernant la protection des bases de données’, (1999) Journal des Tribunaux, 297, 301. Davison, 80; U. Suthersanen, ‘A comparative review of database protection in the European Union and the United States’, in F. Dessemontet and R. Gani (eds), Creative Ideas for Intellectual Property, The ATRIP Papers 2000–2001, Cédidac, Lausanne, 200272; Aplin, 182. Vanhees, 1007. E.g. UK Copyright Act, s. 45; Art. 5(3)(e) of the InfoSoc Directive. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC, OJ L 130/92.

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ARTICLE 10: TERM OF PROTECTION

NOTES 1. Related instruments See Related Instruments at Art. 5.

2. Bibliography Bently, L. and B. Sherman, Intellectual Property Law, 2nd ed., Oxford University Press, Oxford, 2004. Strowel, A. ‘La loi du 31 août 1998 concernant la protection des bases de données’, (1999) Journal des Tribunaux, 297. Suthersanen, U. ‘A comparative review of database protection in the European Union and the United States’, in Dessemontet, F. and R. Gani (eds), Creative Ideas for Intellectual Property, The ATRIP Papers 2000–2001, Cédidac, Lausanne, 2002. Vanhees, H. ‘De juridische bescherming van databanken’, (1999–2000) Rijkskundig Weekblad. See also Bibliography at Art. 1.

ARTICLE 10: TERM OF PROTECTION 1. 2.

3.

The right provided for in Article 7 shall run from the date of completion of the making of the database. It shall expire fifteen years from the first of January of the year following the date of completion. In the case of a database which is made available to the public in whatever manner before expiry of the period provided for in paragraph 1, the term of protection by that right shall expire fifteen years from the first of January of the year following the date when the database was first made available to the public. Any substantial change, evaluated qualitatively or quantitatively, to the contents of a database, including any substantial change resulting from the accumulation of successive additions, deletions or alterations, which would result in the database being considered to be a substantial new investment, evaluated qualitatively or quantitatively, shall qualify the database resulting from that investment for its own term of protection.

I. COMMENTARY 1. Paragraphs 1 and 2 A sui generis right lasts 15 years calculated from 1st January of the year following the date of 9.68 completion. If a database is made available to the public in that period of 15 years, then the 15 years run from the 1st January following the date of the first act of making the database publicly available. Thus a database can potentially be protected up to just under 30 years.

2. Paragraph 3 Paragraph 3 provides a new term of 15 years if a database maker makes a substantial change to the 9.69 elements of the database. This change can be qualitative or quantitative and include additions, deletions or alterations. The term ‘includes’ means that no change to the database as a result of a verification of the elements also counts as a change.130 Indeed, the change is the fact that the database is now updated. The database maker will also have to meet the protection requirement

130

See also Recital 55.

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namely that there has been a substantial investment. If these two conditions are fulfilled (substantial change and substantial investment), they trigger a new term. 9.70 Paragraph 3 also implies that elements of dynamic databases (namely databases which are continually being updated, in other words, electronic databases available online), which have not been re-verified, added or deleted can be protected perpetually. This is because paragraph 3 does not make clear if the new term starts again for the whole database or only for the part of the database which required the new investment and the user has no way of determining which element has not been added, deleted or changed for more than 15 years and for which the sui generis right protection has expired, unless the database maker specifically tags the elements (something the Directive does not oblige him or her to do). From the wording of the Directive (‘shall qualify the database resulting from that investment for its own term of protection’), it could be argued that it is the database comprised of the new elements only.131 However, the prevailing view seems to be that the new right applies to the entire database rather than just to the new elements.132 The infringement test, as interpreted by the CJEU (see above, Art. 7) helps eliminate this problem since if a user takes the elements of the database where the substantial change and new substantial investment does not reside, s/he does not infringe. However, which users are going to take the risk of taking a substantial part when they do not know which elements of the database and thus of that part have been added, deleted or changed?

NOTES 1. CJEU case law See case law at Arts 1 and 7.

2. Bibliography Reichman, J. and P. Samuelson, ‘Intellectual property rights in data?’, (1997) Vanderbilt Law Review, 50, 51. Smith, S. ‘Legal protection of factual compilations and databases in England – How will the Database Directive change the law in this area?’, (1997) Intellectual Property Quarterly 450. Williams, A. ‘Database Directive: Implementation into UK law’, (1997) International Media Law, 15, 93. See also Bibliography at Arts 1 and 9.

ARTICLE 11: BENEFICIARIES OF PROTECTION UNDER THE SUI GENERIS RIGHT 1. 2.

131 132

The right provided for in Article 7 shall apply to database whose makers or rightholders are nationals of a Member State or who have their habitual residence in the territory of the Community. Paragraph 1 shall also apply to companies and firms formed in accordance with the law of a Member State and having their registered office, central administration or principal place of business within the Community; however, where such a company or firm has only its registered office in the territory of the Community, its operations must be genuinely linked on an ongoing basis with the economy of a Member State.

A. Williams, ‘Database Directive: Implementation into UK law’, (1997) International Media Law, 15, 93; Vanhees, 1009. S. Smith, ‘Legal protection of factual compilations and databases in England: How will the Database Directive change the law in this area?’ (1997) Intellectual Property Quarterly, 450, 475; Leistner, 2002, 461–2; J. Reichman, and P. Samuelson, ‘Intellectual property rights in data?’ (1997) Vanderbilt Law Review, 50, 90.

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3.

Agreements extending the right provided for in Article 7 to databases made in third countries and falling outside the provisions of paragraphs 1 and 2 shall be concluded by the Council acting on a proposal from the Commission. The term of any protection extended to databases by virtue of that procedure shall not exceed that available pursuant to Article 10.

I. COMMENTARY Article 11 reserves the sui generis right’s protection to EU nationals or habitual residents, as well as 9.71 to firms established under the laws of a Member State and with their registered office, administration, or principal place of business within the EU.133 This includes foreign firms so long as their business is conducted in the EU. Paragraph 3 empowers the Council to conclude agreements extending the right to databases that are made in third countries and are not covered by paragraphs 1 and 2 i.e. foreign databases which the Directive does not protect. This paragraph is clearly aimed at pushing other countries to adopt a right similar to the sui generis right. Nationals of non-EU countries can only benefit from the sui generis right on the basis of reciprocity. Of course, they can also decide to establish a subsidiary in the EU or else become co-producers with an EU national or resident to benefit from the right.134 Article 11 does not breach international conventions since the sui generis right is a new intellectual property right, which is not covered by them.135 To date, the Council has not yet entered into such agreements with foreign countries. Nevertheless, 9.72 the EU has successfully exported the sui generis right in the EEA (Liechtenstein, Norway and Iceland) as well as some associated states such as Turkey136 and Albania.137 In addition, the EU has not so far been very successful at exporting the right through FTAs.138 For instance, there is no provision in the Canada Comprehensive Economic and Trade Agreement (CETA), the UK–EU Trade and Cooperation Agreement of 24 December 2020, the EU-Japan Agreement or the Singapore Trade and Investment Agreements. But the current texts of the Mercosur139, the EU-Australia140 and of the EU-New Zealand141 Trade Agreements, which are being negotiated, include it.

NOTES 1. Bibliography Rees, C. and S. Chalton (eds), Database Law, Jordan Publishing, Bristol, 1998. See also Bibliography at Art. 1.

133

134 135 136

137 138 139 140 141

According to Gaster, 163, a company does not have to be present in the Member State in question so long as it is formed according to the laws of a Member State. For him, central administration means the firm’s management and principal place of business, the place where actual production takes place. C. Rees and S. Chalton (eds), Database Law, Jordan Publishing, Bristol 1998, 63. Gaster, 169–70. See additional Art. 8 of the Turkish Copyright Act of 1951, which was introduced in the Act on 3 March 2004. The Act provides for the database right in the same terms as in the EU with the same duration but does not provide for exceptions. Art. 119-126 of the Albanian copyright act, Law n. 35/2016 of 31 March 2016. For the list of agreements agreed or being negotiated by the EU, see http://ec.europa.eu/trade/policy/countries-andregions/negotiations-and-agreements/#_in-place. Art. 11, available at http://trade.ec.europa.eu/doclib/docs/2016/november/tradoc_155070.pdf. Art. X.48, available at http://trade.ec.europa.eu/doclib/docs/2018/july/tradoc_157190.pdf. Art. X.48(1), available at http://trade.ec.europa.eu/doclib/docs/2018/july/tradoc_157204.pdf.

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CHAPTER IV COMMON PROVISIONS ARTICLE 12: REMEDIES Member States shall provide appropriate remedies in respect of infringements of the rights provided for in this Directive.

I. COMMENTARY 9.73 This article echoes Article 7 of the Software Directive but is far less detailed. So long as Member States have remedies in place for infringement of the sui generis right similar to those provided for in their copyright laws, they should comply with Article 12. Article 12 has become somehow outdated because of the Enforcement Directive from 2004. Its Article 2 provides that the procedure and remedies provided in the Enforcement Directive will apply to infringement of all intellectual property rights, be they at Community or national level. Nevertheless, paragraph 2 provides that: This Directive shall be without prejudice to the specific provisions on the enforcement of rights and on exceptions contained in Community legislation concerning copyright and rights related to copyright, notably those found in Directive 91/250/EEC and, in particular, Article 7 thereof or in Directive 2001/29/EC and, in particular, Articles 2 to 6 and Article 8 thereof.

The ‘notably’ could thus include the Database Directive and its Article 12. A Commission Statement concerning Article 2 of the Enforcement Directive however states that intellectual property rights include the sui generis right.142

NOTES 1. Related instruments Dir. 2004/48 EC of the European Parliament and of the Council of 29 APRIL 2004 on the enforcement of intellectual property rights, OJ L 157/45, 30.4.2004. Statement by the Commission concerning Article 2 of Directive 2004/48/EC of the European Parliament and of the Council on the enforcement of intellectual property rights, (2005/295/EC), OJ L 94/37.

2. Bibliography See Bibliography at Art. 1.

ARTICLE 13: CONTINUED APPLICATION OF OTHER LEGAL PROVISIONS This Directive shall be without prejudice to provisions concerning in particular copyright, rights related to copyright or any other rights or obligations subsisting in the data, works or other materials incorporated into a database, patent rights, trade marks, design rights, the protection of national treasures, laws on restrictive practices and unfair competition, trade secrets, security, confidentiality, data protection and privacy, access to public documents, and the law of contract.

142

See Statement by the Commission concerning Article 2 of Directive 2004/48/EC of the European Parliament and of the Council on the enforcement of intellectual property rights, (2005/295/EC), OJ L 94/37.

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ARTICLE 13: CONTINUED APPLICATION OF OTHER LEGAL PROVISIONS

I. COMMENTARY Article 13 allows cumulation of the sui generis right and/or copyright on a database with a number of 9.74 other protections. The list is not exhaustive.143 According to Gaster, the inclusion of ‘access to public documents’ somehow replaces the provision of the draft Directive which would have introduced an exception for databases made by the State.144 In practice, it means that a database can be protected by several intellectual property rights and other types of protection in addition as well. Often a database will be licensed and thus be protected by contract. The database maker will also have a trademark which applies to its database. S/he may also apply technological protection measures to its database, which will be protected by anti-circumvention provisions. This latter possibility is provided by the InfoSoc Directive (Art. 6). The addition of similar types of protection such as unfair competition and contract to databases raises problems of over-protection.145 The CJEU missed an opportunity to fully clarify Article 13 in Football Dataco. It held that the 9.75 Database Directive precludes national legislation which grants databases copyright protection under conditions which are different than those set out in Article 3(1) of the Database Directive, i.e. under conditions other than originality. Thus, databases cannot benefit from the English skill and labour copyright protection, the Dutch geschriftenbescherming or the Nordic catalogue rule. In Football Dataco, the CJEU reasoned that the aim of the Directive was to remove differences in 9.76 national legislation particularly on the scope and conditions of copyright protection which adversely affected the functioning of the internal market, free movement of goods and services and the development of an information market in the EU. It also relied in Recital 60 to say that Article 3(1) carries out a ‘harmonisation of the criterion for determining whether a database is to be protected by copyright’.146 It reminded that the Directive’s transitional provisions keep the status quo for databases created before 27 March 1996, so they can remain protected under prior, different, if at all, eligibility criteria. However, for ‘new databases’ (i.e. created after that date), no other copyright protection can exist apart from that provided in the Directive. However, the CJEU did not reply exactly to the question posed. How about ‘copyright-like’ protection such as protection against parasitism or slavish copying, which many national laws provide in their tort law or special unfair competition statutes? The Court of Appeal of England and Wales had asked the CJEU more specifically: ‘Does the Directive preclude national rights in the nature of copyright in databases other than those provided for by [Directive 96/9]?’ Maybe the Court of Justice assumed that since the UK does not have unfair competition law (except passing off), the Court of Appeal did not refer to that type of protection. Nevertheless, the CJEU could have interpreted the question more extensively, since it was posed in such broad terms, i.e. capable of encompassing unfair competition-type legislation. Therefore, the Court’s answer is not entirely clear on this point, but on a logical construction of its paragraph 49, it is fair to assume that that it is not possible to cumulate slavish imitation or parasitism with the sui generis right. Indeed, it would adversely affect the functioning of the internal market and free movement of goods and services if databases could obtain quasicopyright/sui generis right protection through unfair competition law provisions. The answer to this question is important because some Member States, notably France, still 9.77 cumulate copyright and/or the sui generis right with slavish imitation/parasitism. While the appellate courts and the Court of Cassation are rejecting the overlap between the sui generis right and parasitism, French first instance courts are split on the issue. However, if one looks at the recent Supreme Court’s decisions on the relationship between parasitism and all intellectual property 143 144 145 146

Gaster, 176. See also Recital 58. Gaster, 177. See also Beunen, 41. See Derclaye 2008, Chapters 3 and 4. Case C-604/10 Football Dataco, para. 49.

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rights, they show that the tort of parasitism is still alive as the Court seems to constantly contradict itself.147 It is therefore far from certain that the Court of Cassation’s Précom decision in the area of database protection shows a clear trend towards rejection of the overlap between the sui generis right and parasitism.148 The Spanish Supreme Court also seems to allow the cumulation of the sui generis right, copyright and parasitism. In a case involving one of the main Spanish legal databases (Aranzadi), it confirmed the lower instances rulings that held that the defendant infringed the three rights when it copied and marketed Aranzadi’s database (or at least Aranzadi’s case law database) on its website and on CDs.149 In 2012, however, the Spanish Supreme Court held that the defendant’s ‘scraping’ of Ryanair’s website did not constitute parasitism.150 In a case involving Ryanair’s database of flight schedules and prices, the CJEU held that a database, which is neither protected by copyright nor by the sui generis right is not subject to any of its provisions, even if it falls within the concept of a database as defined in Article 1(2) of the Directive.151 In such a case, contracting out of the Database Directive’s exceptions is permitted but without prejudice to any relevant applicable national law.152 9.78 As noted at paragraph 9.68 above, the new exceptions in the Directive on copyright in the digital single market will for the most part be imperative.

NOTES 1. Related instruments See Related Instruments at Arts 1 and 5.

2. CJEU case law See case law at Art. 3.

3. Bibliography Derclaye, E. ‘Recent French Decisions on Database Protection: Towards a More Consistent and Compliant Approach with the Court of Justice’s Case Law?’ (2012) European Journal of Law and Technology, 3(2) available on http://ejlt.org//article/view/124 (accessed 11 February 2013). Derclaye, E. and M. Leistner, Intellectual Property Overlaps: A European Perspective, Hart, Oxford, 2011. See also Bibliography at Arts 1 and 4.

147 148

149

150 151

152

E. Derclaye and M. Leistner, Intellectual Property Overlaps: A European Perspective, Oxford, Hart Publishing, 2011, 173. For more details, see E. Derclaye, ‘Recent French decisions on database protection: Towards a more consistent and compliant approach with the Court of Justice’s case law?’ (2012) European Journal of Law and Technology, 3(2) available on http://ejlt.org//article/view/124 (accessed 11 February 2013). Case STS 988/2008, 30 January 2008, available at http://www.poderjudicial.es/search/doAction?action=content pdf&databasematch=TS&reference=160286&links=96/9&optimize=20080430&publicinterface=true, (accessed 11 February 2013). Ryanair v Atrapalo, Case STS 572/2012, 9 October 2012. See also the discussion under Art. 7. Case C-30/14, Ryanair Ltd. v. PR Aviation BV, [2015] ECR I-000, para. 35. For commentary, see S. Vousden, ‘Autonomy, Comparison Websites, and Ryanair’ (2015) Intellectual Property Quarterly 386–406; M. Borghi and S. Karapapa, ‘Contractual restrictions on lawful use of information: Sole-source databases protected by the back door?’ (2015) European Intellectual Property Review 505–14. Ryanair v PR Aviation, paras 44–45.

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ARTICLE 14: APPLICATION OVER TIME

ARTICLE 14: APPLICATION OVER TIME 1. 2.

3.

4. 5.

Protection pursuant to this Directive as regards copyright shall also be available in respect of databases created prior to the date referred to in Article 16 (1) which on that date fulfil the requirements laid down in this Directive as regards copyright protection of databases. Notwithstanding paragraph 1, where a database protected under copyright arrangements in a Member State on the date of publication of this Directive does not fulfil the eligibility criteria for copyright protection laid down in Article 3 (1), this Directive shall not result in any curtailing in that Member State of the remaining term of protection afforded under those arrangements. Protection pursuant to the provisions of this Directive as regards the right provided for in Article 7 shall also be available in respect of databases the making of which was completed not more than fifteen years prior to the date referred to in Article 16 (1) and which on that date fulfil the requirements laid down in Article 7. The protection provided for in paragraphs 1 and 3 shall be without prejudice to any acts concluded and rights acquired before the date referred to in those paragraphs. In the case of a database the making of which was completed not more than fifteen years prior to the date referred to in Article 16 (1), the term of protection by the right provided for in Article 7 shall expire fifteen years from the first of January following that date.

I. COMMENTARY 1. Paragraph 1 Paragraph 1 states that copyright will protect databases which fulfil the requirements of the 9.79 Directive if these databases were created before the implementation date, namely 1st January 1998. The Directive does not specify when their term of protection starts although, according to Gaster, it is 1st January 1998.153 This means that the protection of some databases could subsist for a very long time. By contrast with the sui generis right (see paragraph 3, below), the Directive does not state a ‘limit to the age of databases to which the Directive’s copyright is available’.154

2. Paragraph 2 Paragraph 2 provides that databases which exist at the date the Directive is adopted (27/03/1996), 9.80 and were protected by copyright law in a Member State at that time, but do not fulfil the new eligibility criteria remain protected for the remainder of their copyright term.

3. Paragraphs 3, 4 and 5 According to paragraph 3, the sui generis right is only available for databases fulfilling the sui generis 9.81 right’s requirements and made not more than 15 years before 1st January 1998, namely 1st January 1983. Their term of protection of 15 years starts from the first January following 1 January 1998 (para. 5). This was a mistake as it should have stated from 1 January 1998.155 Paragraph 4 ensures that if a database acquires copyright or sui generis right on 1 January 1998 pursuant to paragraphs 1 and/or 3, such protection shall be without prejudice to any acts concluded and rights acquired before 1 January 1998. The German Supreme Court confirmed an appellate court decision which had

153 154 155

Gaster, 182. Beunen, 42. Gaster, 184. See also Beunen, 43.

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made clear that the infringement of the sui generis right did not subsist in the sale of a work which, like the book ‘“Hit Bilanz” German chart singles 1956 to 1980’ for example, only reproduced data prior to 1st January 1983.156

NOTES 1. CJEU case law See case law at Art. 3.

2. Bibliography See Bibliography at Arts 1 and 4.

ARTICLE 15: BINDING NATURE OF CERTAIN PROVISIONS Any contractual provision contrary to Articles 6 (1) and 8 shall be null and void.

I. COMMENTARY 9.82 Article 15 renders Articles 6(1) and 8 imperative. This means that owners of copyright and sui generis right in databases cannot override these provisions by any type of contract, be it fully negotiated or standard form. Article 15 will not apply to the whole database but only a part thereof if a lawful user is only licensed to use that part.157 Article 15 means that a contrario, a contract can override the optional exceptions and the other limits (exhaustion and term of protection) since the provision does not render them imperative. Commentators have discussed the disputability of not rendering the other exceptions imperative.158 Indeed, this choice differs from that made in the Software Directive. Also a blanket provision like Article 15 does not make a difference between multiple source and sole source databases nor between adhesion contracts and contracts at arm’s length whereas there are good reasons to differentiate (please refer to para. 9.74).159

NOTES 1. Related instruments See related instruments at Art. 1.

2. Bibliography Guibault, L. Copyright Limitations and Contracts: An Analysis of the Contractual Overridability of Limitations on Copyright, Kluwer Law International, The Hague, 2002. See also Bibliography at Arts 1 and 4.

156 157 158 159

Re a Musical Hits Database (Hit Bilanz), Case I ZR 290/02, 21 July 2005 [2006] ECC 31. Beunen, 43. See mainly L. Guibault, Copyright Limitations and Contracts: An Analysis of the Contractual Overridability of Limitations on Copyright, Kluwer Law International, The Hague, 2002. For more details, see Derclaye, 2008, Chapter 4.

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ARTICLE 16: FINAL PROVISIONS

ARTICLE 16: FINAL PROVISIONS 1.

2. 3.

Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before 1 January 1998. When Member States adopt these provisions, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods of making such reference shall be laid down by Member States. Member States shall communicate to the Commission the text of the provisions of domestic law which they adopt in the field governed by this Directive. Not later than at the end of the third year after the date referred to in paragraph 1, and every three years thereafter, the Commission shall submit to the European Parliament, the Council and the Economic and Social Committee a report on the application of this Directive, in which, inter alia, on the basis of specific information supplied by the Member States, it shall examine in particular the application of the sui generis right, including Articles 8 and 9, and shall verify especially whether the application of this right has led to abuse of a dominant position or other interference with free competition which would justify appropriate measures being taken, including the establishment of non-voluntary licensing arrangements. Where necessary, it shall submit proposals for adjustment of this Directive in line with developments in the area of databases.

I. COMMENTARY This provision is standard and exists in most intellectual property Directives (e.g. Arts 12(1) and 13 9.83 of the InfoSoc Directive and Art. 9, Software Directive). Most Member States complied with the implementation deadline of 1 January 1998.160 More interesting is Article 16(3) which requires the Commission to establish every three years a report on the application of the Directive, which evaluates especially how Articles 8 and 9 have been applied. So far only one report has been issued (in 2005, four years late)161 so that four more reports are now due. In 2017, the European Commission launched a tender for a study to evaluate the Database Directive. The study was published in April 2018 along with the Commission’s evaluation report on the Directive.162 The report decided to adopt the status quo but at the same time agreeing to being open to changes in the future.163 In February 2020, the Commission announced that as part of its European Strategy for Data, it would probably revise the Database Directive in 2021.164

NOTES 1. Related instruments See related instruments at Arts 1 and 5.

160 161

162

163

164

Davison, 98. For views on the report, see e.g. E. Derclaye, ‘Database rights: Success or failure? The chequered yet exciting journey of database protection in Europe’ in C. Geiger, (ed.), Constructing EU Intellectual Property: Achievements and New Perspectives, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2013. Fischer, R. et al., Study in Support of the Evaluation of the Database Directive: Study for the European Commission, DG Connect, 2018, available at https://ec.europa.eu/digital-single-market/en/news/study-support-evaluation-databasedirective. Commission Staff Working Document, Evaluation of Directive 96/9/EC on the legal protection of databases, SWD(2018) 147 final, p. 13, available at https://ec.europa.eu/digital-single-market/en/news/staff-working-document-andexecutive-summary-evaluation-directive-969ec-legal-protection. https://ec.europa.eu/info/sites/info/files/communication-european-strategy-data-19feb2020_en.pdf.

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2. Bibliography Commission Staff Working Document, Evaluation of Directive 96/9/EC on the legal protection of databases, SWD(2018) 147 final. Derclaye, E. ‘Database rights: Success or failure? The chequered yet exciting journey of database protection in Europe’, in Geiger, C. (ed.), Constructing EU Intellectual Property: Achievements and New Perspectives, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2013. See also Bibliography at Art. 1.

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10 THE RESALE RIGHT DIRECTIVE Jens Gaster1 Updated by Irini Stamatoudi DIRECTIVE 2001/84/EC of the European Parliament and of the Council of 27 September 2001 on the resale right for the benefit of the author of an original work of art [2001] OJ L 272/32

I.

COMMENTARY 1. The origins of resale right (droit de suite) 2. The nature of droit de suite 3. International regulation of the resale right 4. Need for harmonisation and EU competence 5. The genesis of Directive 2001/84/EC 6. The Resale Right Directive in one glimpse 7. Implementation in the Member States

10.01 10.01 10.05

I.

10.06 10.08 10.10

I. 10.16 10.17

10.24 10.24

I.

ARTICLE 2: WORKS OF ART TO WHICH THE RESALE RIGHT RELATES I.

COMMENTARY

10.30

CHAPTER II: PARTICULAR PROVISIONS

I.

COMMENTARY

10.33

ARTICLE 4: RATES I.

10.57 10.63 10.68 10.72

COMMENTARY 1. United Kingdom 2. Austria 3. Ireland 4. The Netherlands 5. Luxembourg 6. Greece

10.74 10.79 10.80 10.81 10.82 10.83 10.84

COMMENTARY

10.85

CHAPTER III: FINAL PROVISIONS ARTICLE 10: APPLICATION IN TIME

COMMENTARY

10.36

ARTICLE 5: CALCULATION BASIS I.

COMMENTARY 1. Australia 2. United States 3. China

ARTICLE 9: RIGHT TO OBTAIN INFORMATION

ARTICLE 3: THRESHOLD I.

10.46 10.49 10.52

ARTICLE 8: TERM OF PROTECTION OF THE RESALE RIGHT

ARTICLE 1: SUBJECT MATTER OF THE RESALE RIGHT COMMENTARY 1. Article 1(1)

10.44

ARTICLE 7: THIRD-COUNTRY NATIONALS ENTITLED TO RECEIVE ROYALTIES

CHAPTER I: SCOPE

I.

COMMENTARY 1. Restrictions on the transmission of resale right post mortem 2. Commentary 3. Collective rights management

COMMENTARY

I.

COMMENTARY

10.87

ARTICLE 11: REVISION CLAUSE 10.43

I.

COMMENTARY

10.88

ARTICLE 6: PERSONS ENTITLED TO RECEIVE ROYALTIES

1

The views expressed are the author’s alone and do not necessarily correspond to those of the European Commission.

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ARTICLE 12: IMPLEMENTATION I.

COMMENTARY

10.96

COMMENTARY

10.99

ARTICLE 14: ADDRESSEES

ARTICLE 13: ENTRY INTO FORCE

I. COMMENTARY 1. The origins of resale right (droit de suite) 10.01 As the name suggests, the ‘droit de suite ’ originated in France.2 It was after World War I that French philanthropists lobbied the French Government to create such a right for artists. The need was said to derive from the fact that visual artists were unable to exploit their work to the same extent as other creators. At that time, artists were returning from the war, often penniless. They and their children were starving on the streets of Paris, while their works sold at auction for exuberant amounts, which far surpassed the artist’s original recompense. There was a clear inequality between what the artist received for his efforts compared to the savvy art dealer, who created nothing. So, the right was seen as a response to the inequities of the free market and a desire to better balance the fortunes of artists and encourage the production of fine art, which benefited all of society. 10.02 By virtue of a statute dated 20 May 1920 (later revised by the French Copyright Act of 1957), the droit de suite is an inalienable right whose beneficiaries are artists, then their heirs, to receive, until 70 years after the artist’s death, a percentage of the resale price of an original work of art. The works concerned are paintings, collages, drawings, engravings, lithographs, sculptures, tapestry, ceramics, glass ware and photographs. On 25 June 1921 Belgium followed by adopting similar legislation. 10.03 In France and Belgium the resale right was accorded to artists only when their works were sold at public sale (auction), and their share was 1–3 per cent, in France, and 2–6 per cent, in Belgium, of the sale price. 10.04 Czechoslovakia (on 24 November 1926), Poland (on 22 March 1935), Uruguay (on 17 December 1937) and Italy (on 22 April 1941) likewise enacted legislation on resale right. Whereas France and Belgium permitted artists to share in the proceeds of a resale even if the seller made no gain on the sale the four other countries considered ‘droit de suite ’ as a sharing in the increment in value. In other words, in the countries concerned the artist benefited only when the sale was made at a higher price than that at the last sale.3

2. The nature of droit de suite 10.05 As explained above, some legislators have felt that, in order to strike a balance between the various categories of creator, the authors of graphic and plastic works must be allowed to receive a share of the sale price each time the work changes hands. The artist’s resale right is therefore a right to remuneration, that is to say an exclusive right in diluted form. Moreover, the artist’s resale right is designed so that the author shares in the profits to be earned from his creation alone. Besides being

2

3

‘[The artists’ resale right was b]orn in France in 1920, included in the Article 14ter of the Berne Convention at the International Intellectual Property Organization (WIPO) in 1971 and, harmonized in Europe by the Directive in 2001. The Artist’s Resale Right turned 100 on the 18th May 2020’ https://www.resale-right.org/. For further details concerning the genesis of resale right see P. Katzenberger, Das Folgerecht im deutschen und ausländischen Urheberrecht, Munich, 1970; P. Katzenberger, ‘Harmonisierung des Folgerechts in Europa’, (1997) GRUR Int., 309–5; and L. de Pierredon-Fawcett, The Droit de Suite in Literary and Artistic Property, Columbia, 1991. For further details see working document UNESCO/DA/6, Paris, 9 May 1949.

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I. COMMENTARY

classed as a type of copyright, the right does not fall within the domain of taxation as it does not give rise to the collection of any dues for the benefit of the exchequer.

3. International regulation of the resale right At the international level, as a result of the Brussels Conference (1948) of the Berne Union, the 10.06 subject matter of the resale right is defined by Article 14ter paragraph 1 of the Berne Convention for the Protection of Literary and Artistic Works as follows: The author, or after his death the persons or institutions authorised by national legislation, shall, with respect to original works of art and original manuscripts of writers and composers, enjoy the inalienable right to an interest in any sale of the work subsequent to the first transfer by the author of the work.

Furthermore, the Berne Convention provides that the resale right is available only if legislation in 10.07 the country to which the author belongs so permits. At the international level the right is therefore optional and subject to the rule of reciprocity. However, as regards the EU it follows from the case law of the Court of Justice of the European Union on the application of the principle of non-discrimination laid down in Article 18 TFEU (formerly Art. 12 ECT), as shown in the Phil Collins judgment of 20 October 1993,4 that domestic provisions containing reciprocity clauses cannot be relied upon in order to deny nationals of other Member States rights conferred on national authors. The application of such clauses in an EU context runs counter to the principle of equal treatment resulting from the prohibition of any discrimination on grounds of nationality.

4. Need for harmonisation and EU competence At the moment the Directive was proposed the resale right was already provided for by the domestic 10.08 legislation of a majority of EU Member States. Recital 9 of the Directive explains that such laws, where they existed, displayed certain differences, notably as regards the works covered, those entitled to receive royalties, the rate applied, the transactions subject to payment of a royalty, and the basis on which these are calculated. The application or non-application of such a right has a significant impact on the competitive environment within the internal market, since the existence or absence of an obligation to pay on the basis of the resale right is an element which must be taken into account by each individual wishing to sell a work of art. This right is therefore a factor which contributes to the creation of distortions of competition as well as displacement of sales within the EU. As reflected in Recital 10, the EU legislator was also of the opinion that such disparities with regard 10.09 to the existence of the resale right and its application by the Member States had a direct negative impact on the proper functioning of the internal market as provided for by Article 26 TFEU (formerly Art. 14 ECT). Contrary to what some authors believe5 in such a situation Article 114 TFEU (formerly Art. 95 ECT and Art. 100a EEC) constitutes the appropriate legal basis for the achievement of the objectives of the establishment and functioning of the internal market in works of art.

4 5

Judgment in Joined Cases C-92/92 and C-326/92 Phil Collins v Imtrat Handelsgesellschaft mbH [1993] ECR I-5145. J. Wünschel, ‘Article 95 EC revisited: is the artist’s Resale Right Directive a Community Act beyond EC competence?’, (2009) Oxford Journal of IP Law Practice, 4(2), 130–36 (131 et seq.).

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Chapter 10 THE RESALE RIGHT DIRECTIVE

5. The genesis of Directive 2001/84/EC 10.10 The Directive had a particularly lengthy and difficult genesis.6 Apart from persistent opposition by vested interests such as certain auction houses this difficulty was also linked to the fact that prior to the emergence of the Single Market in 1992 the ‘Community action’ in the field concerned was mainly limited to recommendations made by Ministers of Culture. Still nowadays this weakness of the Union’s cultural policies is reflected in Article 167 TFEU (formerly Art. 151 ECT) which stipulates that in order to contribute to the achievement of the EU’s cultural objectives, including artistic and literary creation ‘the European Parliament and the Council … shall adopt incentive measures, excluding any harmonisation of the laws and regulations of the Member States’. 10.11 It is therefore not surprising that between 1977 and 1995 the issue of a possible harmonisation of the resale right was merely the subject of numerous discussion papers, studies, communications, action points, hearings and working programmes.7 10.12 The Explanatory Memorandum8 attached to the legislative proposal which finally led to the harmonisation of resale right throughout the EU sets out that divergences between Member States’ laws on the artist’s resale right did not ensure a harmonious legal environment promoting the smooth functioning of the market in works of contemporary and modern art in the EU. Consequently, following the publication in January 1991 of its working programme in the field of copyright and neighbouring rights entitled ‘Follow up to the Green Paper’, in which the question of the advisability of a Community initiative on the resale right was raised in Chapter 8.5, the European Commission carried out a number of consultation exercises based on questionnaires and public hearings in July and November 1991, August 1994 and February 1995. 10.13 It was only on 25 April 1996 at a time when the legal and political environment had become more favourable that the European Commission was finally in a position to make its initial proposal.9 It would appear that the consequences of the ECJ’s Phil Collins judgment and of the decision of the German Federal Court in the Joseph Beuys case10 impacted upon the decision of the college of Commissioners to finally make a legislative proposal. 10.14 The Explanatory Memorandum which was attached to the proposal for a Directive highlighted the risk that the disparities in the collection of royalties induce operators to seek ways of circumventing national resale right rules.11 Thus, for example, three works by the contemporary German artist Beuys were sold by auction in London in 1988 for £462,000 (DM 1,418,340). The seller and the buyer were both German collectors. Owing to the territoriality of the artist’s resale right and the resulting impossibility of collecting royalties abroad, the saving made (and the loss for Joseph Beuys’ widow) was of the order of DM 71,000.

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7 8 9 10 11

For details V. Duchemin, ‘La Directive communautaire sur le droit de suite’, (2002) RIDA, 191, 3 at 7 et seq.; J. Gaster, ‘Harmonisierung des Folgerechts?’ in Festschrift für Robert Dittrich, Vienna, 2000, 91, 96 et seq.; M. Walter, ‘Resale Right Directive’, in M. Walter and S. von Lewinski, European Copyright Law. A Commentary, Oxford, 2010, 841 et seq. (10.0.18–10.0.29). For details see Gaster, and the study by C. Doutrelepont, Le droit de suite dans l’Union européenne. Analyse juridique. Elements économiques, Brussels, 1995. COM(96) 97 final, 13.03.1996. COM (1996) 97 final – 1996/0085/COD, OJ C 178, 21.6.1996, 16. BGH [1994] NJW 2888. For an analysis of the decision see Th. Braun, ‘Joseph Beuys und das deutsche Folgerecht bei ausländischen Kunstauktionen’, (1995) IPRax 227 et seq. COM (1996) 97 final, 14.

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I. COMMENTARY

Finally it would take more than five years of very controversial political negotiations12 until the 10.15 European Parliament and the Council finally reached an agreement and Directive 2001/84/EC could be enacted on 27 September 2001.

6. The Resale Right Directive in one glimpse The Directive promoted harmonisation of the substantive conditions for the application of the 10.16 resale right by regulating: (i) (ii) (iii) (iv) (v) (vi)

eligibility and the duration of protection; the categories of works of art to which the resale right applies; the scope of the acts to be covered i.e. all acts involving dealers in works of art; the royalty rates applicable across defined price bands; the maximum threshold for a minimum resale price attracting the right (€3,000); and provisions on third-country nationals entitled to receive royalties.

7. Implementation in the Member States The Directive entered into force on 13 October 2001 and had to be implemented by 1 January 10.17 2006. At the time the Directive was agreed four of the then fifteen Member States did not provide for 10.18 resale right in their national laws: Austria, Ireland, the Netherlands and the UK. These Member States enjoyed a transitional period to 1 January 2010 during which they could choose not to apply the resale right to the works of eligible deceased artists. Such Member States, together with Malta (which adhered to the EU on 1 May 2004), made use of this provision, and of the option to extend the derogation period for a further two years. This derogation came to an end on 1 January 2012, at which point the Directive had to be fully implemented in all (then 27) EU Member States. As a result of their more recent EU accession the transposition deadline for Bulgaria and Romania 10.19 was 1 January 2007. The implementation13 by most Member States was late. However, Denmark’s transposition was 10.20 exactly on time.14 Austria transposed the Directive on 16 February 2006, but applied its Copyright Amendment Act retrospectively as of 1 January 2006.15 Other Member States, such as Italy,16

12 13

14 15

For details on the legislative history of the Resale Right Directive see Walter, 841–6 (1 Ch 10.0.18). For further details and country reports see M. Weller, ‘Die Umsetzung der Folgerechtsrichtlinie in den EG-Mitgliedstaaten: Nationale Regelungsmodelle und europäisches Kollisionsrecht’, (2008) ZEup, 252–88 and Walter, 895–920. Act No 1402 of 21 December 2005, Lovtidende A 22 December 2005. Effective since 1 January 2006. Bundesgesetz, mit dem das Urheberrechtsgesetz geändert wird (Urheberrechtsgesetz-Novelle 2005 – UrhG-Nov 2005), BGBl. I – 16 February 2006 – Nr. 22. Yet, in 2017 it was announced that the European Commission had decided to refer Austria to the Court of Justice of the EU for incorrectly applying Value Added Tax (VAT) to royalty payments paid to artists for the resale of works of art: In a previous judgement, the Court of Justice of the EU decided that when a person provides services without receiving a direct consideration, there is no basis of assessment or amount on the basis of which the VAT can be applied. In the view of the Court, such services are consequently not subject to VAT (C-16/93 on 3 March 1994, R.J. Tolsma). As royalty payments for resale rights are not paid in consideration for goods or services supplied by the artist, they should not be subject to VAT. The European Commission decided to send a reasoned opinion to the Austrian authorities in July 2016. As Austria has failed to bring its legislation in line with EU law, the Commission has decided to refer Austria to the Court of Justice of the EU. https://ec.europa.eu/commission/presscorner/detail/IT/IP_17_4776.

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Decreto Legislativo 13 febbraio 2006, n. 118 ‘Attuazione della direttiva 2001/84/CE, relativa al diritto dell’autore di un’opera d’arte sulle successive vendite dell’originale’ (Gazzetta Ufficiale n. 71 of 25 March 2006).

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Poland,17 Portugal18 or France19 missed the deadline by a couple of months. Germany was late too, since it only brought its legislation in line on 16 November 2006.20 Belgium’s implementation dates from 4 December 2006.21 Greece complied on 26 January 2007.22 Sweden complied in July 2007.23 10.21 Certain other countries, such as Spain, were confronted by infringement proceedings launched by the European Commission on the grounds that no implementing measures had been notified within specified time limits. 10.22 On 31 January 2008 the European Court of Justice ruled that by failing to adopt, within the prescribed period, all the laws, regulations and administrative provisions necessary to comply with Directive 2001/84/EC the Kingdom of Spain had failed to fulfil its obligations under that Directive.24 This failure was even the more noteworthy since Spain had already provided for a resale right since 1987 (as amended by law No 1/1996).25 However, while that very decree constituted a partial and anticipated transposition of the Directive, Spain had not ensured a complete implementation prior to 1 January 2006. Spain finally complied by a statute dated 28 December 2008,26 which took effect on 14 January 2009. 10.23 At the time of writing this contribution all EU Member States and three additional contracting parties to the EEA Agreement27 (Iceland, Liechtenstein, Norway) had notified national execution measures under the Directive.28

NOTES 1. Related instruments Berne Convention for the Protection of Literary and Artistic Works last amended on 28 September 1979. Treaty on the Functioning of the European Union, OJ C 83/47, 30.3.2010.

17 18 19

20 21

22

23 24 25 26 27

28

The relevant statute amending the Polish Copyright and Related Rights Act of 4 February 1994 was enacted on 23 March 2006 (Dz. U. 2006 nr. 66 poz. 474). Lei n.° 24/2006 de 30 de Junho (Artist’s Resale Right). Prior to the Directive France only had one provision in its intellectual property code (Art. L 122–8), while the details of its droit de suite system where set out in a regulatory part. The French legislation was brought in line by a statute dated 1 August 2006 which took effect on 4 August 2006. See Loi n° 2006-961 du 1er août 2006 relative au droit d’auteur et aux droits voisins dans la société de l’information, JORF n°178 du 3 août 2006, p 11529. Fifth Act amending the Copyright Act of 10 November 2006, BGBl. I, 2587. Effective as of 16 November 2006. Loi du 4 décembre 2006 transposant en droit belge la Directive 2001/84/CE du Parlement européen et du Conseil du 27 septembre 2001 relative au droit de suite au profit de l’auteur d’une oeuvre d’art originale (Moniteur belge of 23 January 2007). For details see H. Vanhees, ‘De nieuwe Belgische regeling inzake het volgrecht’, (2007) Auteurs et Media, 199–213. Act No 3524/2007 (OJ 15/A’/26.1.2007). See I. Stamatoudi, Droit de Suite and EU Directive 2001/84/EC, Volume in honour of L. Kotsiri, University of Thessaloniki, Thessaloniki, 2004, at 1043 and in (2004) Nomiko Vima 883. See also I. Stamatoudi and G. Koumantos, Greek Copyright Law, P. Sakkoulas, Athens, 2014; I. Stamatoudi and L. Kotsiris, Commentary on the Greek Copyright Act, Sakkoulas Publications, Athens – Thessaloniki, 2009. The resale right existed in the Greek Copyright Act before the implementation of the Directive. Act (2007:521) amending the Copyright Act. Judgment in Case C-32/07 [2008] ECR I-17. Ley 22/1987, de 11 de noviembre, BOE n° 275, 17 November 1987, 34163. Ley 3/2008, de 23 de diciembre, relativa al derecho de participación en beneficio del autor de una obra de arte original, BOE n° 310, 25 December 2008, 51995. The Agreement on the European Economic Area of 17 March 1993 (OJ No L 1/572, 3.1.1994), which entered into force on 1 January 1994, brings together the (now) 28 EU Member States and the three EFTA States Iceland, Liechtenstein and Norway in a single market. For an overview on the communicated national implementation measures see the Eurlex site http://eur-lex.europa.eu/ LexUriServ/LexUriServ.do?uri=CELEX:72001L0084:EN:NOT.

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ARTICLE 1: SUBJECT MATTER OF THE RESALE RIGHT

2. CJEU case law Phil Collins v Imtrat Handelsgesellschaft mbH (C-92/92 and C-326/92) [1993] ECR I-05145.

3. Bibliography Braun, Th. ‘Joseph Beuys und das deutsche Folgerecht bei ausländischen Kunstauktionen’, (1995) IPRax 227. Doutrelepont, C. Le droit de suite dans l’Union européenne. Analyse juridique. Elements économiques, Brussels, 1995. Duchemin, V. ‘La Directive communautaire sur le droit de suite’, (2002) RIDA, 191, 3. Gaster, J. ‘Harmonisierung des Folgerechts?’, in Festschrift für Robert Dittrich, Vienna, 2000. Katzenberger, P. Das Folgerecht im deutschen und ausländischen Urheberrecht, Munich, 1970. Katzenberger, P. ‘Harmonisierung des Folgerechts in Europa’, (1997) GRUR Int., 309–5. Walter, M. ‘Resale Right Directive’, in M. Walter and S. von Lewinski, European Copyright Law. A Commentary, Oxford, 2010. Weller, M. ‘Die Umsetzung der Folgerechtsrichtlinie in den EG-Mitgliedstaaten: Nationale Regelungsmodelle und europäisches Kollisionsrecht’, (2008) ZEup, 252–88. Wünschel, J. ‘Article 95 EC revisited: is the artist’s Resale Right Directive a Community act beyond EC competence?’, (2009) Oxford Journal for Intellectual Property Law and Practice, 4(2), 130–36.

CHAPTER I SCOPE ARTICLE 1: SUBJECT MATTER OF THE RESALE RIGHT 1.

2. 3. 4.

Member States shall provide, for the benefit of the author of an original work of art, a resale right, to be defined as an inalienable right, which cannot be waived, even in advance, to receive a royalty based on the sale price obtained for any resale of the work, subsequent to the first transfer of the work by the author. The right referred to in paragraph 1 shall apply to all acts of resale involving as sellers, buyers or intermediaries art market professionals, such as salesrooms, art galleries and, in general, any dealers in works of art. Member States may provide that the right referred to in paragraph 1 shall not apply to acts of resale where the seller has acquired the work directly from the author less than three years before that resale and where the resale price does not exceed EUR 10000. The royalty shall be payable by the seller. Member States may provide that one of the natural or legal persons referred to in paragraph 2 other than the seller shall alone be liable or shall share liability with the seller for payment of the royalty.

I. COMMENTARY 1. Article 1(1) 10.24

Article 1(1) of the Directive defines the subject matter of the resale right: Member States shall provide, for the benefit of the author of an original work of art, a resale right, to be defined as an inalienable right, which cannot be waived, even in advance, to receive a royalty based on the sale price obtained for any resale of the work, subsequent to the first transfer of the work by the author.

Such wording stems from Article 14ter of the Berne Convention. It emphasises the inalienable 10.25 nature of the right and makes it clear that the nature of the remuneration is a percentage of the sales price obtained from any (commercial) resale of the work.

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10.26 Pursuant to Article 1(2) the ‘droit de suite ’ shall apply to all acts of resale involving as sellers, buyers or intermediaries art market professionals, such as salesrooms, art galleries and, in general, any dealers in works of art. The provision makes it clear that the resale right does not apply to private sales. 10.27 According to Article 1(3) Member States may provide that the right referred to in paragraph 1 shall not apply to acts of resale where the seller has acquired the work directly from the author less than three years before that resale and where the resale price does not exceed EUR 10,000. 10.28 Article 1(4) makes it clear that the royalty shall be payable by the seller. 10.29 Recital 18 explains that the scope of the resale right should be extended to all acts of resale, with the exception of those effected directly between persons acting in their private capacity without the participation of an art market professional. This right should not extend to acts of resale by persons acting in their private capacity to museums which are not for profit and which are open to the public. With regard to the particular situation of art galleries which acquire works directly from the author, Member States should be allowed the option of exempting from the resale right acts of resale of those works which take place within three years of that acquisition. The interests of the artist should also be taken into account by limiting this exemption to such acts of resale where the resale price does not exceed EUR 10,000.

NOTES 1. Related instruments Berne Convention for the Protection of Literary and Artistic Works last amended on 28 September 1979.

2. Bibliography Arnold, B. Caslon Analytics Profile – droit de suite. Caslon.com.au (April 2010). Barker, E. ‘The California Resale Royalty Act: Droit De [Not So] Suite’, (2001) Hastings Constitutional Law Quarterly, 38(2), 1. Braun T. ‘Joseph Beuys und das deutsche Folgerecht bei ausländischen Kunstauktionen’, (1995) IPRax 227. Csoport, D. Rechtsschutz für Kunstschaffende im schweizerischen und internationalen Urheberrecht, Dissertation St. Gallen 2008. Doutrelepont C. Le droit de suite dans l’Union européenne. Analyse juridique. Elements économiques, Brussels, 1995. Duchemin, V. ‘La Directive communautaire sur le droit de suite’, (2002) RIDA, 191, 3. Gaster, J. ‘Harmonisierung des Folgerechts?’, in Festschrift für Robert Dittrich, Vienna, 2000. Katzenberger, P. Das Folgerecht im deutschen und ausländischen Urheberrecht, Munich, 1970. Katzenberger, P. ‘Harmonisierung des Folgerechts in Europa’, (1997) GRUR Int., 309–5. Katzenberger, P. ‘Die europäische Richtlinie über das Folgerecht’, (2004) GRUR Int., 20–27. Lewis, C. ‘Implementing the artist’s resale right directive’, (2007) Journal of Intellectual Property Law & Practice, 2(5), 298–304. Loewenheim, U. Handbuch des Urheberrechts, 2nd ed., Munich, 2010. McAndrew, C. and L. Dallas-Conte, Implementing Droit de Suite (artists’ resale right) in England. A study for the Arts Council of England. Pierredon-Fawcet, L. de, The Droit de Suite in Literary and Artistic Property, Columbia, 1991. Vanhees, H. ‘De nieuwe Belgische regeling inzake het volgrecht’, (2007) Auteurs et Media, 199–213. Walter, M. ‘Resale Right Directive’, in M. Walter and S. von Lewinski, European Copyright Law. A Commentary, Part 10, Oxford, 2010. Warren, L.K. ‘Droit de suite: Only Congress can grant royalty protection for artists’, (2013) Pepperdine Law Review, 111. Weller, M. ‘Die Umsetzung der Folgerechtsrichtlinie in den EG-Mitgliedstaaten: Nationale Regelungsmodelle und europäisches Kollisionsrecht’, (2008) ZEup, 252–88.

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ARTICLE 2: WORKS OF ART TO WHICH THE RESALE RIGHT RELATES J. Wünschel, ‘Article 95 EC revisited: is the artist’s Resale Right Directive a Community act beyond EC competence?’ (2009) Oxford Journal for Intellectual Property Law and Practice, 4(2), 130–36.

ARTICLE 2: WORKS OF ART TO WHICH THE RESALE RIGHT RELATES 1.

2.

For the purposes of this Directive, ‘original work of art’ means works of graphic or plastic art such as pictures, collages, paintings, drawings, engravings, prints, lithographs, sculptures, tapestries, ceramics, glassware and photographs, provided they are made by the artist himself or are copies considered to be original works of art. Copies of works of art covered by this Directive, which have been made in limited numbers by the artist himself or under his authority, shall be considered to be original works of art for the purposes of this Directive. Such copies will normally have been numbered, signed or otherwise duly authorised by the artist.

I. COMMENTARY Article 2(1) of the Directive lists those works of art to which the resale right relates.

10.30

For the purposes of this Directive, ‘original work of art’ means works of graphic or plastic art such as pictures, collages, paintings, drawings, engravings, prints, lithographs, sculptures, tapestries, ceramics, glassware and photographs, provided they are made by the artist himself or are copies considered to be original works of art.

Recital 19 emphasises that the harmonisation brought about by the Directive does not apply to 10.31 original manuscripts of writers and composers. Whereas Article 14ter of the Berne Convention includes such original manuscripts contrary to the initial Commission proposal at first reading29 the European Parliament thought fit to cover visual works only. In its amended proposal of 12 March 199830 the Commission accepted to exclude original manuscripts from the harmonising measure. Article 2(2) extends its application to copies of works of art covered by the Directive, which have 10.32 been made in limited numbers by the artist himself or under his authority. Such copies, which will normally have been numbered, signed or otherwise duly authorised by the artist, are considered to be original works of art for the purposes of the Directive.

NOTES 1. Related instruments Berne Convention for the Protection of Literary and Artistic Works last amended on 28 September 1979.

2. Bibliography See Bibliography at Art. 1.

29 30

See opinion in first reading at the plenary session of 9 April 1997, OJ C 132, 28.04.1997, 88. COM (1998) 78 final, OJ C 125, 23.4.1998, 8.

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CHAPTER II PARTICULAR PROVISIONS ARTICLE 3: THRESHOLD 1. 2.

It shall be for the Member States to set a minimum sale price from which the sales referred to in Article 1 shall be subject to resale right. This minimum sale price may not under any circumstances exceed EUR 3,000.

I. COMMENTARY 10.33 Article 3 of the Directive allows Member States to set a minimum sale price below which no royalty is payable. This minimum sale price may not under any circumstances exceed €3,000. 10.34 In the course of law making this threshold was particularly controversial. The initial Commission proposal suggested to set the minimum sales price at €1,000. The European Parliament initially suggested lowering the sum to €500. By contrast the Council of Ministers discussed raising the amounts concerned to oscillate between €2,000 and €4,000. In the Council’s common position of 19 June 2000, the threshold was then set at €4,000. After conciliation proceedings the threshold was finally set at the rate of €3,000. 10.35 As far as the implementation of Article 3 is concerned31 it would appear that out of the 30 EEA contracting States bound by the Directive nine apply the maximum amount whereas four do not provide for any threshold at all and the 17 others apply a minimum sales price sometimes significantly below €3,000. The UK for its part finally applied a threshold of €1,000.

NOTES 1. Bibliography Walter, M. ‘Resale Right Directive’, in M. Walter and S. von Lewinski, European Copyright Law. A Commentary, Oxford University Press, Oxford, 2010. See also Bibliography at Art. 1.

ARTICLE 4: RATES 1.

2.

31

The royalty provided for in Article 1 shall be set at the following rates: (a) 4 per cent for the portion of the sale price up to EUR 50,000; (b) 3 per cent for the portion of the sale price from EUR 50,000.01 to EUR 200,000; (c) 1 per cent for the portion of the sale price from EUR 200,000.01 to EUR 350,000; (d) 0.5 per cent for the portion of the sale price from EUR 350,000.01 to EUR 500,000; (e) 0.25 per cent for the portion of the sale price exceeding EUR 500,000. However, the total amount of the royalty may not exceed EUR 12,500. By way of derogation from paragraph 1, Member States may apply a rate of 5 per cent for the portion of the sale price referred to in paragraph 1(a).

For further details see Walter, 861 et seq. (10.3.4).

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ARTICLE 4: RATES

3.

If the minimum sale price set should be lower than EUR 3000, the Member State shall also determine the rate applicable to the portion of the sale price up to EUR 3,000; this rate may not be lower than 4 per cent.

I. COMMENTARY Article 4 sets out the royalty rate payable, which follows a sliding scale but may not exceed in total 10.36 €12,500. According to Article 4(1) the resale right royalty shall be set at the following rates: (a) (b) (c) (d) (e)

10.37

4 per cent for the portion of the sale price up to EUR 50,000; 3 per cent for the portion of the sale price from EUR 50,000.01 to EUR 200,000; 1 per cent for the portion of the sale price from EUR 200,000.01 to EUR 350,000; 0.5 per cent for the portion of the sale price from EUR 350,000.01 to EUR 500,000; 0.25 per cent for the portion of the sale price exceeding EUR 500,000.

The rates of the royalty were intensely discussed during the legislative process.32 In its initial 10.38 proposal the Commission had proposed declining scales beginning with 4 per cent and tapering from 3 per cent down to 2 per cent. The European Parliament considered lowering the rate in the lower price band whereas the Council imposed a further lowering of the percentages and the introduction of the overall cap. The practical effect of the royalty cap concerns sales attaining a resale price above €2 million. In fact, 10.39 the portion of the price exceeding this amount is not at all taken into consideration. It is doubtful whether this unique limitation of intellectual property rights is in line with international and constitutional requirements. As a defence it has been suggested, however, that unlike other rights in the field of copyright and related rights, the subject matter of the resale right is the physical object, namely the medium in which the protected work is incorporated.33 Since the rates set by the Directive are sometimes considerably lower than normally uniform 10.40 national rates applicable prior to the enactment of the Directive, pursuant to Article 4(2) Member States may apply a rate of 5 per cent for the portion of the sale price referred to in paragraph 1(a) of the provision concerned. The graded royalty rates for resale right have been criticised in a study on the practical aspects of the 10.41 exercise of the droit de suite which was prepared for UNESCO’s Intergovernmental Copyright Committee in 2001.34 According to the study the tapering scales reflect the EU Member States’ differing legislations and take into consideration the fact that within the harmonisation process several Member States insisted that the implementation of droit de suite with high royalty rates would lead to the transfer of the art trade to third countries, which do not recognise this right. Furthermore, it is claimed that a uniform rate of 3 per cent would not prompt any vendor to quit a marketplace. As regards the setting of royalty rates the study concludes that in order to avoid sale price manipulations and bureaucratic obstacles, the Directive’s example of the different rates should not be taken as a model. A single, fixed rate for all sales would be more practical and enable debtors, right holders, art dealers and collecting societies to handle the management of resale right in a simple and efficient manner. 32 33 34

For the legislative history of the provision see also Walter, 863 et seq. (10.4.1–10.4.5). T. Cook, ‘Section 25 – Intellectual Property’, in Vaughan and Robertson’s Law of the European Union, Issue 24, 2009, [230]. IGC (1971)/XII/6, 27 March 2001.

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Chapter 10 THE RESALE RIGHT DIRECTIVE

10.42 It is noteworthy that the capping of the royalty at €12,500, which is unique for all economic rights even well beyond copyright, has not been addressed.

NOTES 1. Bibliography Cook, T. ‘Section 25 – Intellectual Property’, in Vaughan and Robertson’s Law of the European Union, Issue 24, 2009. Walter, M. ‘Resale Right Directive’, in M. Walter and S. von Lewinski, European Copyright Law. A Commentary, Oxford University Press, Oxford, 2010. See also Bibliography at Art. 1.

ARTICLE 5: CALCULATION BASIS The sale prices referred to in Articles 3 and 4 are net of tax.

I. COMMENTARY 10.43 Article 5 provides for the sales prices concerned to be net of tax.

NOTES 1. Bibliography See Bibliography at Art. 1.

ARTICLE 6: PERSONS ENTITLED TO RECEIVE ROYALTIES 1. 2.

The royalty provided for under Article 1 shall be payable to the author of the work and, subject to Article 8(2), after his death to those entitled under him/her. Member States may provide for compulsory or optional collective management of the royalty provided for under Article 1.

I. COMMENTARY 10.44 Article 6(1) lists those who are entitled to receive resale right royalties, namely the author of the work and after his death those entitled under him/her. 10.45 Recital 27 explains that the persons entitled to receive royalties must be specified, due regard being had to the principle of subsidiarity. It is not appropriate to take action through this Directive in relation to Member States’ laws of succession. However, those entitled under the author must be able to benefit fully from the resale right after his death, at least following the expiry of the transitional period referred to above.

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ARTICLE 6: PERSONS ENTITLED TO RECEIVE ROYALTIES

1. Restrictions on the transmission of resale right post mortem On 15 April 2010 the ECJ ruled that Article 6(1) did not preclude French law from restricting the 10.46 benefit of the resale right to the author’s heirs, to the exclusion of legatees or other successors in title.35 The Court took the view that the Directive sought to ensure a certain level of remuneration for artists. For that reason, Article 1(1) provides that the resale right is to be defined as inalienable and not to be subject to an advance waiver. However, according to the Court the attainment of that objective is in no way compromised by the transfer of the resale right to certain categories of persons to the exclusion of others after the death of the artist, as the transfer is ancillary to that objective. On 28 September 2012 the French Constitutional Court issued a ruling, confirming that the 10.47 statutory provisions governing the droit de suite’s transmission post mortem are constitutional.36 Pursuant to Section L.123–7 of the French Intellectual Property Code, upon the author’s death, the 10.48 droit de suite passes to the author’s heirs (and spouse) to the exclusion of legatees. This provision was attacked as creating an undue discrimination between heirs and legatees. The Court held that the difference in treatment was justified, stating that: by reserving the transmission of the droit de suite upon the author’s death to heirs […], to the exclusion of legatees and other successors-in-interest, the legislator has instituted a difference in treatment between persons who are differently situated; such difference in treatment is directly related to the objective pursued by the law.

2. Commentary It is true that pursuant to Recital 27 the EU legislator did not, in accordance with the principle of 10.49 subsidiarity, consider it appropriate to take action through that Directive in relation to Member States’ laws of succession, thus leaving to each Member State the task of defining the categories of persons capable of being considered, under national law, as those entitled. It also follows from Article 14ter (1) of the Berne Convention that after the author’s death the 10.50 inalienable ‘droit de suite ’ shall be enjoyed by the persons or institutions authorised by national legislation. It should be noted, however, that according to Article 7(1) of the Berne Convention the (minimum) 10.51 term of protection granted by the Convention shall be the life of the author and 50 years after his death. At EU level this term of protection is set at 70 years post mortem auctoris (pma) (see below). Moreover, it follows from Recital 27 of the Directive that those entitled under the author must be able to benefit fully from the resale right after his death. It would appear though that, in the case of deceased right holders leaving no legal heirs but only other beneficiaries, the ECJ’s and the Conseil Constitutionnel’s jurisprudence limit the term of protection to the life of the author.

3. Collective rights management According to Article 6(2) Member States may provide for compulsory or optional collective 10.52 management of the resale right royalty.

35 36

Case C-518/08 Fundació Gala-Salvador Dalí and Visual Entidad de Gestión de Artistas Plásticos (VEGAP) v Société des auteurs dans les arts graphiques at plastiques (ADAGP) [2010] ECR I-3091. Décision no 2012–276 QPC du 28 septembre 2012. http://www.conseil-constitutionnel.fr/conseil-constitutionnel/ francais/les-decisions/acces-par-date/decisions-depuis-1959/2012/2012–276-qpc/decision-n-2012–276-qpc-du-28septembre-2012.115613.html.

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Chapter 10 THE RESALE RIGHT DIRECTIVE

10.53 Recital 28 provides that the Member States are responsible for regulating the exercise of the resale right, particularly with regard to the way this is managed. In this respect management by a collecting society is one possibility. Member States should ensure that collecting societies operate in a transparent and efficient manner. Member States must also ensure that amounts intended for authors who are nationals of other Member States are in fact collected and distributed. This Directive is without prejudice to arrangements in Member States for collection and distribution. 10.54 All four EU Member States which did not provide for artist’s resale rights prior to the enactment of the Directive implemented Article 6(2) by providing for collective rights management. 10.55 In Austria such rights are administered by IG BILDENDE KUNST. In Ireland the Irish Visual Artists Rights Organisation (IVARO) has been entrusted with this task. In the Netherlands the royalties are collected and distributed by the Stichting Pictoright. In the United Kingdom the artist’s resale rights are managed by the Design and Artist’s Copyright Society (DACS) or by the Artists’ Collecting Society (ACS). 10.56 Almost all other EU Member States likewise provide for collective rights management. Amongst the respective associations or societies are the Société des auteurs dans les arts graphiques et plastiques (ADAGP) and the Société des Auteurs des arts visuels et de l’Image Fixe (SAIF) in France, VG Bild-Kunst in Germany, the Italian Society of Authors and Publishers (SIAE) in Italy, the societies Związek Polskich Artystów Plastyków (ZPAP) and Związek Polskich Artystów Fotografików (ZPAF) in Poland and VEGAP (Visual Entidad de Gestión de Artistas Plásticos) in Spain and Organismos Syllogikis Diacheirisis Ergon ton Eikastikon Technon kai Efarmogon (OSDEETE) in Greece. It should be noted that such collecting societies have concluded reciprocal rights agreements with sister organisations throughout Europe and beyond.

NOTES 1. Related instruments Berne Convention for the Protection of Literary and Artistic Works last amended on 28 September 1979.

2. CJEU case law Fundacion Gala-Salvador Dalí v VEGAP / ADAGP (C-518/08) [2010] ECR I-3091.

3. Bibliography See Bibliography at Art. 1.

ARTICLE 7: THIRD-COUNTRY NATIONALS ENTITLED TO RECEIVE ROYALTIES 1.

Member States shall provide that authors who are nationals of third countries and, subject to Article 8(2), their successors in title shall enjoy the resale right in accordance with this Directive and the legislation of the Member State concerned only if legislation in the country of which the author or his/her successor in title is a national permits resale right protection in that country for authors from the Member States and their successors in title.

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ARTICLE 7: THIRD-COUNTRY NATIONALS ENTITLED TO RECEIVE ROYALTIES

2. 3.

On the basis of information provided by the Member States, the Commission shall publish as soon as possible an indicative list of those third countries which fulfil the condition set out in paragraph 1. This list shall be kept up to date. Any Member State may treat authors who are not nationals of a Member State but who have their habitual residence in that Member State in the same way as its own nationals for the purpose of resale right protection.

I. COMMENTARY Article 7 limits the third-country nationals who are entitled to receive resale right royalties to those 10.57 who are nationals of third countries which confer reciprocal treatment on EU nationals. The reciprocity principle is also foreseen in Article 14ter(2) of the Berne Convention. According to 10.58 this provision the protection provided may be claimed in a country of the Berne Union only if legislation in the country to which the author belongs so permits, and to the extent permitted by the country where this protection is claimed. Recital 6 of the Directive explains that the resale right is optional and subject to the rule of 10.59 reciprocity. It follows from the case law of the Court of Justice of the European Union on the application of the principle of non-discrimination laid down in Article 12 ECT, as shown in the ECJ’s Phil Collins judgment of 20 October 1993,37 that domestic provisions containing reciprocity clauses cannot be relied upon in order to deny nationals of other Member States rights conferred on national authors. The application of such clauses in the EU context runs counter to the principle of equal treatment resulting from the prohibition of any discrimination on grounds of nationality. However, pursuant to Recital 29 enjoyment of the resale right should be restricted to EU nationals 10.60 as well as to foreign authors whose countries afford such protection to authors who are nationals of Member States. A Member State should have the option of extending enjoyment of this right to foreign authors who have their habitual residence in that Member State. If the condition of material reciprocity is complied with, an author originating from a third country 10.61 may claim the resale right royalty in accordance with the Directive and the legislation of the Member State concerned. In 2013 artists’ resale rights were provided in about 65 jurisdictions, although the rules were not 10.62 always applied consistently.

1. Australia The Resale Royalty Right for Visual Artists Act 200938 gives the creator of an artwork the right to 10.63 receive a royalty when the work is resold on the commercial art market. For artworks already in existence at 9 June 2010, the royalty applies only to the second and subsequent resales after that date. Under clauses 22 and 23 of the Act artists have a case-by-case right to instruct the appointed government agency, the Copyright Agency Ltd, to not collect and/or make their own individual collection arrangements.

37 38

Joined Cases C-92/92 and C-326/92 Phil Collins and Others. Resale Royalty Right for Visual Artists Act 2009, No. 125, 2009. http://www.comlaw.gov.au/Details/C2009A00125. For a detailed discussion of resale right from an Australian perspective see B. Arnold, Caslon, Analytics Profile – droit de suite. Caslon.com.au.

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Chapter 10 THE RESALE RIGHT DIRECTIVE

10.64 The royalty is calculated as 5 per cent of the sale price, but does not apply where that price is less than $1,000. It is payable, via an official collecting agency, or if the creator chooses (on a case-by-case basis) it can be paid directly to the creator, on resales made during their lifetime and to their heirs for resales made up to 70 years after the creator’s death. The primary legal obligation to pay the royalty rests on the seller. However, in economic terms, it may effectively be passed on to the purchaser. 10.65 Eligible artworks include original works of graphic or plastic art, including pictures, collages, paintings, drawings, engravings, prints, lithographs, sculptures, tapestries, ceramics, glassware, photographs, fine art textiles, installations, fine art jewellery, artists’ books, carvings and multimedia artworks. 10.66 The royalty is restricted to Australian citizens or residents, although there is provision for reciprocal rights to be extended in the future to persons resident in other jurisdictions with compatible royalty schemes. 10.67 The introduction of the scheme was controversial, as it has been elsewhere.

2. United States 10.68 In 1976 the California legislature passed the California Resale Royalty Act (CRRA),39 thus introducing a form of droit de suite at State level. It has been claimed that this version of resale right has been pre-empted by the US Copyright Act of 1976.40 10.69 On May 17, 2012 the CRRA was struck down as unconstitutional because according to the judge it violated the US Constitution Interstate Commerce clause. At the time of writing the ruling is pending appeal in the 9th Circuit Court of Appeals. 10.70 The Court found that the CRRA explicitly regulates applicable sales of fine art occurring wholly outside California. The CRRA regulates transactions occurring anywhere in the US, so long as the seller resides in California. Even the artist, the intended beneficiary of the CRRA, does not have to be a citizen of, or reside in, California. For that reason it was held that the CRRA violates the Commerce Clause of the US’s Constitution. 10.71 In September 2012, the US Copyright Office published a ‘Notice of inquiry’ regarding establishing an artists’ ‘resale royalty right’ in the US.41 The Copyright Office had been asked by Congress to review how the current copyright legal system affects and supports visual artists; and how a federal resale royalty right for visual artists would affect current and future practices of groups or individuals involved in the creation, licensing, sale, exhibition, dissemination, and preservation of works of visual art. Furthermore, the office called for a public hearing which should take place on 23 April 2013.

3. China 10.72 China is considering introducing droit de suite legislation that means artists will receive royalty payments when their work is resold at auction. The artists’ resale right clause is contained in the draft of a new copyright law soon to be submitted to China’s State Council, the country’s cabinet.

39 40 41

California Civil Code, s 986. L.K. Warren, ‘Droit de suite: Only Congress can grant royalty protection for artists’, (2013) Pepperdine Law Review, 111 at 129 et seq. http://www.copyright.gov/docs/resaleroyalty/.

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ARTICLE 8: TERM OF PROTECTION OF THE RESALE RIGHT

According to the draft, the resale right would apply to original works of fine art and photography, as 10.73 well as literary and musical manuscripts. It says that creators or their heirs have a right to share in any profit if the owner of the original piece sells it via auction.

NOTES 1. Related instruments Berne Convention for the Protection of Literary and Artistic Works last amended on 28 September 1979.

2. CJEU case law Phil Collins v Imtrat Handelsgesellschaft mbH (C-92/92 and C-326/92) [1993] ECR I-5145.

3. Bibliography Warren, L.K. ‘Droit de suite: Only Congress can grant royalty protection for artists’, (2013) Pepperdine Law Review, 111. See also Bibliography at Art. 1.

ARTICLE 8: TERM OF PROTECTION OF THE RESALE RIGHT 1. 2.

3.

4.

The term of protection of the resale right shall correspond to that laid down in Article 1 of Directive 93/98/EEC. By way of derogation from paragraph 1, those Member States which do not apply the resale right on (the entry into force date referred to in Article 13), shall not be required, for a period expiring not later than 1 January 2010, to apply the resale right for the benefit of those entitled under the artist after his/her death. A Member State to which paragraph 2 applies may have up to two more years, if necessary to enable the economic operators in that Member State to adapt gradually to the resale right system while maintaining their economic viability, before it is required to apply the resale right for the benefit of those entitled under the artist after his/her death. At least 12 months before the end of the period referred to in paragraph 2, the Member State concerned shall inform the Commission giving its reasons, so that the Commission can give an opinion, after appropriate consultations, within three months following the receipt of such information. If the Member State does not follow the opinion of the Commission, it shall within one month inform the Commission and justify its decision. The notification and justification of the Member State and the opinion of the Commission shall be published in the Official Journal of the European Communities and forwarded to the European Parliament. In the event of the successful conclusion, within the periods referred to in Article 8(2) and (3), of international negotiations aimed at extending the resale right at international level, the Commission shall submit appropriate proposals.

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Chapter 10 THE RESALE RIGHT DIRECTIVE

I. COMMENTARY 10.74 By Article 8 of the Directive, the resale right has the same duration as copyright, as laid down in Article 1 of the Term Directive (now Directive 2006/116/EC42 as amended by Directive 2011/77/ EU43). 10.75 Recital 17 explains that pursuant to Council Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights (which is now consolidated as Directive 2006/116/EC), the term of copyright runs for 70 years after the author’s death. The same period should be laid down for the resale right. Consequently, only the originals of works of modern and contemporary art may fall within the scope of the resale right. However, in order to allow the legal systems of Member States which do not, at the time of the adoption of this Directive, apply a resale right for the benefit of artists to incorporate this right into their respective legal systems and, moreover, to enable the economic operators in those Member States to adapt gradually to the aforementioned right while maintaining their economic viability, the Member States concerned should be allowed a limited transitional period during which they may choose not to apply the resale right for the benefit of those entitled under the artist after his death. 10.76 This latter derogation is provided by Article 8(2) of the Directive. According to the provision Member States such as the UK, Austria, Ireland and the Netherlands, prior to the enactment of the Directive not having such a right, could initially avail themselves of the derogation until 1 January 2010. As set out in Article 8(3) this transitional period could be extended up to two more years, ‘if necessary to enable the economic operators in that Member State to adapt gradually to the resale right system while maintaining their economic viability’. 10.77 It should be noted that under Article 7(1) of the Berne Convention the term of protection granted by this Convention shall be (at least) the life of the author and 50 years after his death. Pursuant to Article 7(6) thereof the countries of the Berne Union may grant a term of protection in excess of the minimum term. Such term provisions should in principle apply to all authors’ rights, including resale right, notwithstanding the fact that according to Article 14ter(2) of the Berne Convention ‘droit de suite ’ is an optional right. In fact, it may be claimed in a country of the Berne Union only if legislation in the country to which the author belongs so permits, and to the extent permitted by the country where this protection is claimed. In other words the right is subject to the application of the principle of reciprocity. 10.78 Article 8(2) of the Directive is derogating from the requirements set out by Article 7 of the Berne Convention. This derogation has been justified on the basis of the right’s optional character, the temporary nature of the reduced term of protection and the fact that such transitional arrangements were required to assist certain EU Member States with introducing the concept of resale right.

1. United Kingdom 10.79 In the UK the artists’ resale right was introduced by the Artist’s Resale Rights Regulations 2006.44 On 1 January 2012 UK artists’ estates became entitled to receive payment of a percentage of the purchase price of their works whenever an EU art market professional is involved in the resale of their works for €1,000 or more, on or after that date. However, as a consequence, in the UK the new rights for deceased artists’ estates do not apply to resales contracted before 1 January 2012. 42 43 44

OJ L 372/12, 27.12.2006. OJ L 265/1, 11.10.2011. SI 2006 No. 346. For details of the UK implementation see C. Lewis, ‘Implementing the Artist’s Resale Right Directive’ (2007) Journal of Intellectual Property Law & Practice, 2(5), 298–304.

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ARTICLE 8: TERM OF PROTECTION OF THE RESALE RIGHT

2. Austria By an amendment of its Copyright Act taking effect on 1 January 2012 Austria abrogated its 10.80 transitional arrangements and reduced the minimum resale price from €3,000 to € 2,500.45

3. Ireland The resale right was introduced in Ireland on 13 June 200646 (for living artists) and extended to 10.81 benefit the heirs of deceased artists on 1 January 2012.

4. The Netherlands As of 1 January 2012 the application of the Dutch resale right legislation was likewise extended to 10.82 70 years after the author’s death.47 This extension meant a considerable increase in the number of works of art for which resale royalties may be claimed. According to estimates it was expected that at least four times more works than previously would be affected.

5. Luxembourg Luxembourg is a special case. When the Resale Right Directive was enacted, the Copyright Act of 10.83 the Grand-Duchy already in fact provided for ‘droit de suite ’,48 but as a result of a lack of implementing regulations the royalty was not levied in practice. An implementing Regulation dated 25 August 200549 finally stipulates that resale right is due for each resale taking place after 1 January 2006. However, the extension to the estate of a deceased artist only applies as of 1 January 2010.

6. Greece Greece implemented the Resale Right Directive by Act No 3524/2007 (OJ 15/A’/26.1.2007), 10.84 which amended article 5 of the Greek Copyright Act (No 2121/1993), which already provided for a resale right. There is no minimum resale price in Greek law.50

NOTES 1. Related instruments Berne Convention for the Protection of Literary and Artistic Works last amended on 28 September 1979. Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights, OJ L 290/12, 24.11.1993. Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights, OJ L 372/12, 12.12.2006. Directive 2011/77/EU of the European Parliament and of the Council of 27 September 2011 amending Directive 2006/116/EC on the term of protection of copyright and certain related rights OJ L 265/1, 11.10.2011.

45 46 47 48 49 50

Urheberrechtsgesetz-Novelle 2009, BGBl. I , 13.1.2010. European Communities (Artist’s Resale Right) Regulations 2006, S.I. 2006 No 312. Besluit van 8 december 2009, houdende verlenging van de periode in artikel 43e, derde lid, Auteurswet. Article 30 of the ‘loi du 18 avril 2001 sur les droits d’auteur, les droits voisins et les bases de données’, Mémorial, p 1042, 30 April 2001. Règlement grand-ducal du 25 août 2005 relatif au droit de suite, Mémorial, p 3106, 22 September 2006. See Stamatoudi, Droit de Suite and EU Directive 2001/84/EC, at 1043 and in (2004) Nomiko Vima 883. See also Stamatoudi and Koumantos, Greek Copyright Law; Stamatoudi and Kotsiris, Commentary on the Greek Copyright Act.

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Chapter 10 THE RESALE RIGHT DIRECTIVE

2. Bibliography Lewis, C. ‘Implementing the Artist’s Resale Right Directive’, (2007) Journal of Intellectual Property Law & Practice, 2(5), 298–304. Stamatoudi, I. Droit de Suite and EU Directive 2001/84/EC, Volume in honour of L. Kotsiri, University of Thessaloniki, Thessaloniki, 2004. Stamatoudi, I. and L. Kotsiris, Commentary on the Greek Copyright Act, Sakkoulas Publications, Athens – Thessaloniki, 2009. Stamatoudi I. and G. Koumantos, Greek Copyright Law, P. Sakkoulas, Athens, 2014. See also Bibliography at Art. 1.

ARTICLE 9: RIGHT TO OBTAIN INFORMATION The Member States shall provide that for a period of three years after the resale, the persons entitled under Article 6 may require from any art market professional mentioned in Article 1(2) to furnish any information that may be necessary in order to secure payment of royalties in respect of the resale.

I. COMMENTARY 10.85 Article 9 confers on those entitled to benefit from ‘droit de suite ’ the right, subject to a three-year limitation period, to obtain information from any art market professional mentioned in Article 1(2) to furnish any information that may be necessary in order to secure payment of royalties in respect of the resale. 10.86 Recital 30 illustrates the motives of the legislator. Accordingly, appropriate procedures for monitoring transactions should be introduced so as to ensure by practical means that the resale right is effectively applied by Member States. This implies also a right on the part of the author or his authorised representative to obtain any necessary information from the natural or legal person liable for payment of royalties. Member States which provide for collective management of the resale right may also provide that the bodies responsible for that collective management should alone be entitled to obtain information.

NOTES 1. Bibliography See Bibliography at Art. 1.

CHAPTER III FINAL PROVISIONS ARTICLE 10: APPLICATION IN TIME This Directive shall apply in respect of all original works of art as defined in Article 2 which, on 1 January 2006, are still protected by the legislation of the Member States in the field of copyright or meet the criteria for protection under the provisions of this Directive at that date.

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ARTICLE 11: REVISION CLAUSE

I. COMMENTARY Article 10 concerns the application in time. The Directive shall thus apply in respect of all original 10.87 works of art as defined in Article 2 which, on 1 January 2006, are still protected by the legislation of the Member States in the field of copyright or meet the criteria for protection under the provisions of this Directive at that date.

NOTES 1. Bibliography See Bibliography at Art. 1.

ARTICLE 11: REVISION CLAUSE 1.

2.

3.

The Commission shall submit to the European Parliament, the Council and the Economic and Social Committee not later than 1 January 2009 and every four years thereafter a report on the implementation and the effect of this Directive, paying particular attention to the competitiveness of the market in modern and contemporary art in the Community, especially as regards the position of the Community in relation to relevant markets that do not apply the resale right and the fostering of artistic creativity and the management procedures in the Member States. It shall examine in particular its impact on the internal market and the effect of the introduction of the resale right in those Member States that did not apply the right in national law prior to the entry into force of this Directive. Where appropriate, the Commission shall submit proposals for adapting the minimum threshold and the rates of royalty to take account of changes in the sector, proposals relating to the maximum amount laid down in Article 4(1) and any other proposal it may deem necessary in order to enhance the effectiveness of this Directive. A Contact Committee is hereby established. It shall be composed of representatives of the competent authorities of the Member States. It shall be chaired by a representative of the Commission and shall meet either on the initiative of the Chairman or at the request of the delegation of a Member State. The task of the Committee shall be as follows: + to organise consultations on all questions deriving from application of this Directive, + to facilitate the exchange of information between the Commission and the Member States on relevant developments in the art market in the Community.

I. COMMENTARY Article 11 addresses issues such as implementation reports, a review clause and the creation of a 10.88 Contact Committee. The first report on the implementation and the effect of the Directive was due by 1 January 2009. 10.89 As explained in the Commission’s answers, which were given to various written Parliamentary questions51 the submission of the report on the practical effects of the resale right was however

51

See responses to questions for written answer E-7596/2010 by Klaus-Heiner Lehne (OJ C 290 E, 20/08/2011), E-1656/2011 by Daniel Hannan (OJ C 294 E, 6/10/2011) and E-4471/2011 by Charles Tannock (OJ C 314 E, 27/10/2011).

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Chapter 10 THE RESALE RIGHT DIRECTIVE

delayed by the late transposition of the Directive and the granting of exemptions totalling six years in favour of those Member States which did not have the resale right prior to 2001. Realistically, the practical effects of the Directive will not be foreseeable until sometime after the expiry of the exemptions. 10.90 On 14 December 2011 the European Commission adopted an initial prospecting report on the implementation and effect of Directive 2001/84/EC.52 The Commission proposed to establish a stakeholder dialogue, tasked with making recommendations for the improvement of the system of resale right collection and distribution in the EU; and to undertake a further reporting exercise with a view to delivering results in 2014. 10.91 The report had been prepared in particular with a view on the concerns that art market professionals had expressed during the legislative process. It was feared by certain interests that shares of the markets would be shifted to third countries. Such effect could however not be confirmed by the Commission’s findings. The report therefore concluded that no detrimental effect of the introduction and harmonisation of the right on the European art market could be observed. In countries without resale right the market did not grow faster than in EU Member States. The development continued in 2011 where UK, France and Germany benefited from important growth of the market while the share of art market turnover in the US and in Switzerland decreased. The Commission concluded that there is ‘no pattern’ that the art market would react in a specific way on the introduction of the right. The art market in general recovered very quickly from the worldwide financial crisis sparked in 2009 when the contemporary art sector results fell dramatically in value and volume. In 2010 a level above the results in 2006 was reached. 10.92 On 20 November 2012 the European Parliament adopted a resolution on the implementation and the results reported by the European Commission.53 As regards trends in the European and global art markets the resolution stated that 2011 was a record year for the art market and that total annual revenue was USD 11.57 billion, an increase of over USD 2 billion on 2010. Against this background it was stressed that the art and antiques market makes a significant contribution to the global economy, including the businesses it supports, especially those in the creative industries. Furthermore, the EP pointed out that there was strong growth in the European art market in 2011. The UK maintained a 19.4 per cent share of the global market, with an increase of 24 per cent in sales volume; France’s market share was 4.5 per cent, with a 9 per cent increase in turnover; and, Germany saw a 23 per cent increase in sales, with a market share of 1.8 per cent. 10.93 The EP noted, inter alia, that the Commission’s report on the implementation and effect of the Directive and statistics from the sector do not suggest that the resale right has had a detrimental effect on Europe’s art market. It was also highlighted that the Directive was only implemented in full in all Member States on 1 January 2012, although a resale right has been recognised in many Member States for several decades. Parliament also stressed the importance of giving proactive support to local artists, including the youngest artists; and considered it premature to reassess the Directive in 2014 as the Commission plans to do. Instead Parliament proposed that the reassessment be carried out in 2015 (four years after the assessment made in December 2011). Finally, MEPs welcomed the initiatives taken by third countries to introduce the resale right and urged the Commission to continue its efforts in multilateral fora to strengthen the European art market’s position in the world.

52 53

Report on the Implementation and Effect of the Resale Right Directive (2001/84/EC), COM(2011) 878 final, 14.12.2011. European Parliament resolution of 20 November 2012 on the Report on the Implementation and Effect of the Resale Right Directive (2001/84/EC), http://www.europarl.europa.eu/sides/getDoc.do?type=TA&language=EN&reference= P7-TA-2012–421.

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ARTICLE 12: IMPLEMENTATION

At the beginning of 2013 a Stakeholder Dialogue was launched. The Dialogue brought together 10.94 CMOs and visual artists as well as art market professionals. The aim of the Dialogue was to discuss practical solutions to problems faced by those involved in the payment and the administration of the resale right. The result of the Dialogue was the ‘Key Principles and Recommendations on the Management of the Author Resale Right’. These principles and recommendations provided for possible policies and procedures, which would help to improve the administration of the right for all stakeholders. In 2014, the various stakeholders signed up to those principles.54 Member States at WIPO asked for the resale right to be included in the Standing Committee on 10.95 Copyright and Related Rights (SCCR) Agenda. In November 2018 in the context of the SCCR a ‘Task force on the artist’s resale royalty right’ was set up.55 The task force envisaged holding meetings in 2018 and 2019 in order to address the essential elements of the resale right system.56

NOTES 1. Bibliography See Bibliography at Art. 1.

ARTICLE 12: IMPLEMENTATION 1.

2.

Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before 1 January 2006. They shall forthwith inform the Commission thereof. When Member States adopt these measures, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods of making such a reference shall be laid down by the Member States. Member States shall communicate to the Commission the provisions of national law which they adopt in the field covered by this Directive.

I. COMMENTARY Article 12 concerns implementation deadlines and Member States’ obligations relating to notifica- 10.96 tion requirements.

54 55 56

https://www.globalcube.net/clients/evartistsv2/content/medias/images/slideshow/MUTSAKA_ 2014.02.19_09.35.36_5C4N6684_1.pdf. SCCR 36th Sesssion, SCCR/37/5, 14.11.2018. The topics to be addressed are the following: + + + + + + + + + +

The basis of the right including the increase in value of the art work; Works covered by the right; Determination of rate; Mode of collection and distribution; Transactions covered; Persons who may claim the right; Management of the right; Liability for payment; Information about resales; and Any other matter as agreed by the task force.

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Chapter 10 THE RESALE RIGHT DIRECTIVE

10.97 Member States were required to bring into force the laws, regulations and administrative provisions necessary to comply with the Directive before 1 January 2006 and to inform the European Commission thereof. As noted above, most Member States did not achieve this deadline despite the fact that the implementation deadline was exceptionally long (namely five years and three months). 10.98 Moreover, as it is standard EU practice, Member States are under an obligation to communicate to the Commission the provisions of national law which they adopt in the field covered by this Directive.

NOTES 1. Bibliography See Bibliography at Art. 1.

ARTICLE 13: ENTRY INTO FORCE This Directive shall enter into force on the day of its publication in the Official Journal of the European Communities.

I. COMMENTARY 10.99 Article 13 regulates the entry into force of the Directive. According to the provision Directive 2001/84/EC entered into force on the day of its publication in the Official Journal of the European Communities. This date was 13 October 2001. 10.100 Entry into force and transposition of a Directive should not be confused. First of all it must be borne in mind that Member States are obliged to pass the required national legislation at the latest by the implementation deadline. Prior to the adoption of any national implementation act the Directive concerned may however already have certain effects as of the date of entry into force. Apart from situations addressed by the ECJ’s doctrine of direct effect this holds in particular true as regards treaty making powers in the field concerned. In other words, in the present instance the EU Member States have lost, as of 13 October 2001, the competence to negotiate individually at international level issues which are covered by the resale right Directive.

ARTICLE 14: ADDRESSEES This Directive is addressed to the Member States.

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11 THE INFORMATION SOCIETY DIRECTIVE Christophe Geiger and Franciska Schönherr (Articles 5 and 6(4)) Irini Stamatoudi and Paul Torremans Updated by Stavroula Karapapa DIRECTIVE 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/10

I.

COMMENTARY

5. Exhaustion of rights

11.01

11.54

CHAPTER I: OBJECTIVE AND SCOPE

ARTICLE 5: EXCEPTIONS AND LIMITATIONS

ARTICLE 1: SCOPE

I.

I.

COMMENTARY 1. Scope (para 1) 2. Relationship with other Directives (para 2)

11.02 11.02 11.03

CHAPTER II: RIGHTS AND EXCEPTIONS ARTICLE 2: REPRODUCTION RIGHT I.

COMMENTARY

11.05

ARTICLE 3: RIGHT OF COMMUNICATION TO THE PUBLIC OF WORKS AND RIGHT OF MAKING AVAILABLE TO THE PUBLIC OTHER SUBJECT MATTER I.

COMMENTARY 1. Introduction 2. The right of communication to the public 3. The right of ‘making available to the public’ 4. Hypertext links and cloud services 5. The notion of ‘public’ 6. Exhaustion of rights

11.14 11.14 11.16 11.25 11.30 11.34 11.36

ARTICLE 4: DISTRIBUTION RIGHT I.

COMMENTARY 1. Introduction 2. ‘Authors’ 3. ‘Original of their works or of copies thereof’ 4. ‘By sale or otherwise’

11.42 11.42 11.45 11.47 11.53

COMMENTARY

11.68

II. METHOD OF HARMONISATION OF ARTICLE 5 1. An exhaustive list of limitations A. Exceptions or limitations? B. An open or closed list of limitations? 2. A list of predominantly optional limitations A. One mandatory exception B. Twenty optional exceptions or limitations 3. The limit of Member States’ discretion: the three-step test of Article 5(5) A. International and EU three-step test B. Article 5(5) as a tool for flexible interpretation of limitations 11.80 III. EFFECT OF ARTICLE 5 1. A degree of harmonisation A. Increased convergence among the different systems B. One EU-wide mandatory limitation for transient copies: (Art. 5(1)) 2. The role of case law A. Case law of the CJEU: enhancing transparency through harmonious interpretation B. National case law: taking advantage of flexibilities IV. POSSIBLE REVISION OF ARTICLE 5

11.70 11.70 11.70 11.71 11.73 11.73 11.74 11.78 11.78

11.82 11.82 11.82 11.84 11.85

11.85 11.97 11.103

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Chapter 11 THE INFORMATION SOCIETY DIRECTIVE 1. Willingness to reform the EU system of limitations to copyright law 2. A transparent framework capable of coping with future developments A. Setting the framework: education, information and expression as guiding objectives B. A clear legal framework for the accommodation of unknown new uses 3. Relation to Technical Protection Measures (TPMs) and Article 6(4) of the Directive 4. Relation to moral rights V. FAIR COMPENSATION, REMUNERATION AND THE LINK TO COLLECTIVE MANAGEMENT 1. The notion of ‘fair compensation’ and the right to property 2. An exception justified by practical considerations and privacy protection: private copying and Article 5(2)(b) 3. Towards horizontal harmonisation of practical solutions?

11.105

11.105

11.108

I.

11.114 11.114

COMMENTARY

COMMENTARY 1. Introduction 2. Article 8(1) 3. Article 8(2) 4. Article 8(3) – Injunctions against intermediaries A. Introduction B. Liability of internet service providers

11.119

ARTICLE 9: CONTINUED APPLICATION OF OTHER LEGAL PROVISIONS

11.122

I.

COMMENTARY

11.165 11.165 11.168 11.170 11.171 11.171 11.174

11.194

ARTICLE 10: APPLICATION OVER TIME I.

COMMENTARY

11.196

ARTICLE 11: TECHNICAL ADAPTATIONS I. 11.126 11.126 11.127

COMMENTARY 1. Article 11(1) 2. Article 11(2)

11.198 11.198 11.200

ARTICLE 12: FINAL PROVISIONS I.

11.129 11.135 11.141

COMMENTARY 1. Article 12(1) 2. Article 12(2) 3. Article 12(3) and (4)

11.202 11.202 11.203 11.204

ARTICLE 13: IMPLEMENTATION I.

COMMENTARY

11.207

ARTICLE 14: ENTRY INTO FORCE 11.142

I.

COMMENTARY

11.208

ARTICLE 15: ADDRESSEES

ARTICLE 7: OBLIGATIONS CONCERNING RIGHTS-MANAGEMENT INFORMATION I.

11.154 11.159 11.163

CHAPTER IV: COMMON PROVISIONS

11.109 11.113

ARTICLE 6: OBLIGATIONS AS TO TECHNOLOGICAL MEASURES COMMENTARY 1. Background 2. Similar provisions in EU law 3. Effective technological measures (para. 3) 4. Circumvention (para. 1) 5. Preparatory acts (para. 2) A. The manufacture, import, distribution, sale, rental, advertisement for sale or rental, or possession for commercial purposes of devices, products or components or the provision of services

11.151 11.152

ARTICLE 8: SANCTIONS AND REMEDIES

CHAPTER III: PROTECTION OF TECHNOLOGICAL MEASURES AND RIGHTS-MANAGEMENT INFORMATION

I.

1. Background 2. Rights management information 3. ‘Adequate legal protection’ for persons ‘knowingly’ performing ‘unauthorised’ acts of ‘works or protected subject matter’ 4. Actionable acts 5. Other issues

11.103

I.

COMMENTARY

11.209

11.151

I. COMMENTARY 11.01 The Information Society Directive is the only EU Directive, so far, which harmonises copyright and related rights issues to a larger extent and in a horizontal manner compared to any other Directive, with the exception of the Enforcement Directive, which is however targeted on enforcement. Although its title relates to the Information Society, its provisions are also valid in the analogue world. The Information Society Directive implements into EU law the WIPO Copyright Treaty (WCT) and the WIPO Performances and Phonograms Treaty (WPPT), which were concluded in 1996. Yet, some of its provisions go well beyond these two Treaties and have been

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I. COMMENTARY

rather controversial during the legislative process. This is also the reason why the Commission tabled its initial proposal on 21 May 1999 while the Directive was finally adopted on 22 May 2001.1 The Information Society Directive was part of a set of Directives envisaged already in 1988 in the European Commission’s Green Paper on ‘Copyright and the Challenge of Technology’,2 which sought to strike a balance between the rights of authors and right holders and the challenges of the emerging technologies and the internet. Two sets of Directives had been initiated in this context. The first set contained six Directives focusing on particular sectors of copyright (‘first generation of Directives’). These were the Computer Programs Directive, the Rental and Lending Rights Directive, the Satellite and Cable Directive, the Term Directive, the Database Directive and the Resale Right Directive. The second set of Directives, known as the ‘second generation Directives’ were rather horizontal in scope and harmonised copyright and related rights in general. These were the Information Society Directive and the Enforcement Directive. These two Directives are not meant to disturb the function or prejudice in any respect the existing (first set of) Directives in the field. This is the general concept underlying this second set of Directives and provided throughout them. The Orphan Works Directive, the Collective Rights Management Directive (though targeted on specific issues and limited in terms of scope), the Digital Single Market Directive and the Directive on permitted uses for the benefit of persons who are blind, visually impaired or otherwise print-disabled also follow a largely horizontal approach. When one interprets the provisions of the first-generation Directives one should also take into account the provisions of the second set of Directives for the sake of uniformity and consistency of EU law.

NOTES 1. Related instruments Council Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights, OJ L 290/9, 24.11.1993. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs, OJ L 111/16, 23.4.2009. Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376/28, 27.12.2006. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases, OJ L 77/20, 27.03.96. Directive 2001/84/EC of the European Parliament and of the Council of 27 September 2001 on the resale right for the benefit of the author of an original work of art, OJ L 272/32, 13.10.2001. Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights, OJ L 157/32, 30.4.2004. Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works, OJ L 299/5, 27.10.2012. Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market, OJ L 84, 20.3.2014. Directive (EU) 2017/1564 of the European Parliament and of the Council of 13 September 2017 on certain permitted uses of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled and amending Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 242, 20.9.2017. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC, OJ L 130, 17.5.2019.

1 2

An amended proposal was tabled on 21 May 1999 whilst the Common Position followed on 28 September 2000. COM (88) 172 Final, 7.6.1988.

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Chapter 11 THE INFORMATION SOCIETY DIRECTIVE Regulation (EU) 2017/1128 of the European Parliament and of the Council of 14 June 2017 on cross-border portability of online content services in the internal market, OJ L 168, 30.6.2017. Regulation (EU) 2017/1563 of the European Parliament and of the Council of 13 September 2017 on the cross-border exchange between the Union and third countries of accessible format copies of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled, OJ L 242, 20.9.2017. World Copyright Treaty (WCT) of 20 December 1996. WIPO Performances and Phonograms Treaty (WPPT) of 20 December 1996.

CHAPTER I OBJECTIVE AND SCOPE ARTICLE 1: SCOPE 1. 2.

This Directive concerns the legal protection of copyright and related rights in the framework of the internal market, with particular emphasis on the information society. Except in the cases referred to in Article 11, this Directive shall leave intact and shall in no way affect existing Community provisions relating to: (a) the legal protection of computer programs; (b) rental right, lending right and certain rights related to copyright in the field of intellectual property; (c) copyright and related rights applicable to broadcasting of programmes by satellite and cable retransmission; (d) the term of protection of copyright and certain related rights; (e) the legal protection of databases.

SELECTED RECITAL (20) This Directive is based on principles and rules already laid down in the Directives currently in force in this area, in particular Directives 91/250/EEC, 92/100/EEC, 93/83/EEC, 93/98/ EEC and 96/9/EC, and it develops those principles and rules and places them in the context of the information society. The provisions of this Directive should be without prejudice to the provisions of those Directives, unless otherwise provided in this Directive.

I. COMMENTARY 1. Scope (para 1) 11.02 Although the title of the Directive relates to the information society, some of its provisions are valid in a wider context, too. It is just the emphasis that is on the internet. The Directive also does not aim to harmonise the whole area of copyright and related rights but aspects of it only, which are relevant to the Internal Market.

2. Relationship with other Directives (para 2) 11.03 The Information Society Directive leaves intact (as explained in the introduction to this chapter) all pre-existing Directives. There are, however, particular provisions in it which introduce changes and which are expressly provided in the relevant Articles. More specifically:

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ARTICLE 1: SCOPE

(a) (b)

(c) (d) (e)

The Computer Programs Directive remains intact. Article 7 of the Rental and Lending Rights Directive concerning the right of reproduction for performers and other related rights holders is repealed and instead Article 2 of the Information Society Directive applies. In addition (and always in relation to related rights holders) Article 3(2) applies, which introduces the right of making available to the public, which was not provided under the Rental and Lending Rights Directive; Articles 6 and 7 concerning technological protection measures and rights management information, and Article 11(1)(b) (that modifies Art. 10(3) of the Rental and Lending Rights Directive) which extends the three-step test to related rights holders, too. The Satellite and Cable Directive remains intact. Article 3(2) of the Term Directive is amended by Article 11(2) of the Information Society Directive. Articles 6 and 7 of the Information Society Directive also apply to authors of databases as well as the sui generis right holders (Database Directive).

Note that Directives that were issued after the launch of the Information Society Directive, such as 11.04 the Orphan Works Directive, the Digital Single Market Directive and the Directive on permitted uses for the benefit of blind, visually impaired or otherwise print-disabled persons, have amended certain provisions of the Information Society Directive. In particular: (a)

(b)

(c)

Article 6 of the Orphan Works Directive provides a copyright exception to the right of reproduction and the right of making available to the public provided for respectively in Articles 2 and 3 of the Information Society Directive 2001/29/EC to ensure that cultural organisations are permitted to use orphan works contained in their collections. The Directive on permitted uses for the benefit of blind, visually impaired or otherwise printdisabled persons revises the exception available to uses, for the benefit of people with a disability available under Article 5(3) of the Information Society Directive. The Digital Single Market Directive leaves intact and does not affect existing rules laid down in the Information Society Directive (Art. 1(2)). It does however introduce new exceptions to reproduction right for purposes of text and data mining (Arts 3 and 4) and preservation of cultural heritage (Art. 6); exceptions to the rights of reproduction and communication to the public by reference to permitted uses of works for the purposes of cross-border teaching (Art. 5) and certain uses of out-of-commerce works by cultural heritage institutions (Art. 8); expands the scope of the rights of reproduction and communication to the public for press publishers (Art. 15); expands the applicability of the three-step test embedded in Article 5(5) of the Information Society Directive to all exceptions and limitations introduced (Art. 7); applies further amendments to the Information Society Directive (Art. 24).

NOTES 1. Related instruments Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs, OJ L 111/16, 23.4.2009. Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376/28, 12.2.2006. Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights, OJ L 290/9, 24.11.1993. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases, OJ L 77/20, 27.03.96. Directive 2001/84/EC of the European Parliament and of the Council of 27 September 2001 on the resale right for the benefit of the author of an original work of art, OJ L 272/32, 13.10.2001.

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Chapter 11 THE INFORMATION SOCIETY DIRECTIVE Directive 2004/48/EC of the European Parliament and of the Council OF 29 April 2004 on the enforcement of intellectual property rights, OJ L 157/32, 30.4.2004. Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works, OJ L 299/5, 27.10.2012. Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market, OJ L 84, 20.3.2014. Directive (EU) 2017/1564 of the European Parliament and of the Council of 13 September 2017 on certain permitted uses of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled and amending Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 242, 20.9.2017. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC, OJ L 130, 17.5.2019.

CHAPTER II RIGHTS AND EXCEPTIONS ARTICLE 2: REPRODUCTION RIGHT Member States shall provide for the exclusive right to authorise or prohibit direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part: (a) (b) (c) (d) (e)

for authors, of their works; for performers, of fixations of their performances; for phonogram producers, of their phonograms; for the producers of the first fixations of films, in respect of the original and copies of their films; for broadcasting organisations, of fixations of their broadcasts, whether those broadcasts are transmitted by wire or over the air, including by cable or satellite.

SELECTED RECITAL (21) This Directive should define the scope of the acts covered by the reproduction right with regard to the different beneficiaries. This should be done in conformity with the acquis communautaire. A broad definition of these acts is needed to ensure legal certainty within the internal market.

I. COMMENTARY 11.05 Article 2 deals with the right of reproduction, which is considered one of the most basic economic rights of authors and related rights holders. This right is extended to cover authors of works and four types of related rights holders (as these right holders were also provided in the Rental and Lending Rights Directive):3 (a) all authors of works (with the exception of authors of computer programs and databases, which are covered by separate Directives as provided in Art. 1); (b) performers; (c) phonogram producers; (d) film producers and (e) broadcasting organisations.

3

This was provided in Art. 7 of the Rental Rights Directive, which was repealed by Art. 11(1)(a) of the Information Society Directive.

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ARTICLE 2: REPRODUCTION RIGHT

The right of reproduction subsists in the right holders’ exclusive right to authorise or prohibit the 11.06 direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part, of their works or subject matter. ‘By any means and in any form’: This right covers both analogue and digital reproductions of the 11.07 work irrespective of the fact whether the original work was in an analogue or digital form and is reproduced in another format (digital or analogue respectively). It may also be reproduced by any means and on any material carrier or immaterial format. It is therefore irrelevant whether a wooden sculpture is photographed, copied by hand from the photograph into a marble, then photographed again and loaded on a site on the internet. All these acts are considered to be reproductions. Reproductions may be ‘direct or indirect’, ‘temporary or permanent’ or ‘total or partial’.

11.08

‘Direct or indirect’: Indirect reproductions are usually those where another medium is involved in the 11.09 reproduction process. Instead for example of copying a sermon in a church by hand (which would be considered a direct reproduction of the work), record it and then listen to the recording and put it down by hand. This is also the case when the work is broadcast or communicated to the public from the recording.4 Indirect reproductions are sometimes confused with reproductions, which are facilitated by a third party. These strictly speaking are not considered to be reproductions for the party that facilitated them but rather for the party that performs them even if that party has used the facilities provided to it to gain access to the work in order to copy it. A characteristic example in this respect is a hypertext link. The person/entity that places the link may be considered liable for contributory infringement or may not be considered liable at all depending on the facts of the case and the legal traditions at issue. In Paperboy5 the German Federal Court held that deep linking by an aggregator who compiled an email list of links to articles on the plaintiff’s newspaper site was unobjectionable as long as it did not evade technical protection mechanisms and that it did not provide content access that the right holder had not authorised. Hypertext links and search engines constituted reasonable use of the internet.6 This was also the stance in Meteodata v Bernegger Bau (Austria)7 and Fin Eiendom AS v Notar AS (Norway).8 Different approaches were followed in Havas Numerique SNC and Cadres On Line S.A. v Keljob (France)9 and in Newspaper Publishers’ Association v Newsbooster.com ApS (Denmark).10, 11 The original German approach, as it was expressed in Paperboy, changed later in a number of other cases.12 In Case C-466/12 Svensson v Retriever Sverige AB [2014] EUECJ C-466/12, the CJEU found that the provision on a website of clickable links to works freely available on another website must be considered to be ‘making available’ and, therefore, an ‘act of communication’. However, the use in question did not amount to copyright infringement because the communication was not addressed to a new public: as the initial communication was not subject to any restrictive measures, all internet users could have free access to the relevant works.

4 5 6 7 8 9 10

11 12

See M. Walter and S. von Lewinski, European Copyright Law, Oxford University Press, Oxford, 2010, 967. Verlagsgruppe Handelsblatt GmbH v Paperboy, Bundesgerichtshof No 1 ZR 259/00, 17 July 2003, [2005] ECDR 7. Gr.J.H. Smith, Internet Law and Regulation, Sweet & Maxwell, London, 2007, 72. Austrian Supreme Court, 17 December 2002. Trondheim District Court, 29 January 2004, [2004] ECLR. 9, (7), 18 February 2004. 26 December 2000, Paris Commercial Court (E-Commerce Law Reports, vol. 1, Issue 2, 16) then on Appeal (World Internet Law Report, August 2001, 15) and a later decision by the Paris Civil Court as referred to by Smith, 72. 7 May 2002, Denmark Bailiff’s Court (World eBusiness Law Report, 12 May 2003). See however a later decision in Home v Ofir, Maritime and Commercial Court Ruling (Copenhagen), February 24, 2006. Zoekallehuizen.nl v NVM, District Court (Arrondissementsrechtbank) Arnhem (The Netherlands), 16 March 2006 (hypertext linking is permissible under the quotation right). See also Belgian Association of Newspaper Editors v Google (5 May 2011). See, however, Decision I-20 U 42/11 Dusseldorf Court of Appeal 8 October 2011 and DNPA v Google (November 2008).

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11.10 ‘Temporary or permanent’: The right of reproduction is particularly wide in the sense that it covers both permanent and temporary copies.13 Any act that reproduces the work is considered to constitute reproduction. The only copies that are excluded are the ones exempted mandatorily under Article 5(1); these are copies, which are transient or incidental and form an integral and essential part of a technological process and whose sole purpose is to enable: (a) a transmission in a network between third parties by an intermediary, or (b) a lawful use of a work or other subject matter to be made, and which have no independent economic significance. This means that transmissions between networks, servers or routers of internet service providers where multiple copies are made in order to facilitate the transmission process, and which are not stored or are stored for a limited amount of time and only in the process of such transmission, are exempted altogether. The same applies to copies that are made in the process of conducting a lawful action, such as for example the making of copies in the RAM memory of a computer in order to listen to a piece of music one has legally purchased from the internet. Such acts are not supposed to have independent economic significance. If these acts were not expressly exempted in the Directive, their exemption by means of interpreting the scope of the reproduction right would impinge on the filter of the three-step test (applying to the exceptions and limitations to the exclusive rights of authors and related rights holders). These exceptions are put there in order to avoid the unnecessary expansion of the reproduction right and to leave out acts, which are considered to constitute ‘mere use’ of the work such as browsing and navigating on the internet. An example of such kind of use was discussed in Case C-360/13 Public Relations Consultants Association Ltd v Newspaper Licensing Agency Ltd and Others [2014] EUECJ C-360/13, where subject to discussion was a media monitoring service which sent its customers emails containing the headlines of online articles, hyperlinks to the articles’ publishers’ websites and short extracts of the articles themselves. The CJEU held that since on-screen copies were deleted when internet users moved away from the website, and since cached copies were automatically replaced with other content, such copies were temporary in nature and the use in question benefited from the temporary copying exception of Article 5(1).14 11.11 Articles 2–5 do not apply to computer programs and to databases for which there are special provisions provided in the Computer Programs Directive (Arts 4–6) and the Database Directive (Arts 5–6) respectively. 11.12 There is also an optional exception provided under Article 5(2)(d) of the Information Society Directive in respect of ephemeral recordings of works made by broadcasting organisations by means of their own facilities and for their own broadcasts. 11.13 ‘In whole or in part’: Even partial reproductions of works are considered to constitute reproductions.15 This is especially so in jurisdictions that do not require that a substantial part of the work 13 14

15

The Court of Justice of the European Union has confirmed that the right of reproduction is to be construed broadly. See Case C-5/08 Infopaq International A/S v Danske Dagblades Forening [2009] ECR I-6569. Stamatoudi, I. ‘“Linking”, “Framing” and “Browsing”. The EU Court of Justice’s recent case law’, in G. Karnell, A. Kur, P.J. Nordell, D. Westman, J. Axhamn, S. Carlsson (eds) Liber Amicorum Jan Rosen, Eddy.se ab, Halmstad, 2016, 759. Stamatoudi, I. ‘“Linking” and “Browsing” in the light of the EU Court of Justice’s recent case law’ in Tana Pistorius (ed.), IP Perspectives on the Regulation of New Technologies, ATRIP IP series, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2018, 179. See Case 406/10 SAS Institute Inc v World Programming Ltd, 2 May 2012, [2011] EUECJ C-406/10, where the CJEU ruled that: article 2(a) of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society must be interpreted as meaning that the reproduction, in a computer program or a user manual for that program, of certain elements described in the user manual for another computer program protected by copyright is capable of constituting an infringement of the copyright in the latter manual if – this being a matter for the national court to ascertain – that reproduction constitutes the expression of the intellectual creation of the author of the user manual for the computer program protected by copyright.

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should be reproduced. In this sense, even music, video or news sampling may be considered a reproduction. See the Belgian case Belgian Association of Newspaper Editors v Google (5 May 2011) where the Brussels Court of Appeal confirmed in general terms the decision of the Court of First Instance and ordered Google to withdraw from the ‘cached’ links visible on ‘Google Web’ and ‘Google News’ service, all articles, photographs and graphical representations of the Belgian publishers of French and German press represented by Copiepresse (a Belgian collecting society).16 See also Case C-476/17, Pelham GmbH et Anor v Ralf Hütter et Anor [2019] EUECJ C-476/17, where sampling, i.e. copying of the sounds fixed in a phonogram, was held to amount to reproduction ‘in part’ of a protected work, however short the extracts taken. In cases involving reproductions ‘in part’, the quotation exception of Article 5(3)(d) of the Information Society Directive may apply.

NOTES 1. Related instruments Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs, OJ L 111/16, 5.6.2009. Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376/28, 27.12.2006. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases, OJ L 77/20, 27.03.96.

2. CJEU case law BestWater International GmbH v Michael Mebes, Stefan Potsch (Case C-348/13) [2014] EUECJ C-348/13_CO. Football Association Premier League Ltd and Others v QC Leisure and Others (C-403/08) and Karen Murphy v Media Protection Services Ltd (C-429/08) [2011] ECR I-9083. GS Media BV v Sanoma Media Netherlands BV, Playboy Enterprises International Inc, Britt Geertruida Dekker (Case C-160/15) [2016] EUECJ C-160/15. Infopaq International A/S v Danske Dagblades Forening (C-5/08) [2009] ECR I-6569. Pelham GmbH et Anor v Ralf Hütter et Anor (Case C-476/17) 2019] EUECJ C-476/17. Svensson v Retriever Sverige AB (Case C-466/12) [2014] EUECJ C-466/12.

ARTICLE 3: RIGHT OF COMMUNICATION TO THE PUBLIC OF WORKS AND RIGHT OF MAKING AVAILABLE TO THE PUBLIC OTHER SUBJECT MATTER 1.

16

Member States shall provide authors with the exclusive right to authorise or prohibit any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access them from a place and at a time individually chosen by them.

According to C-403/08 Football Association Premier League Ltd and Others v QC Leisure and Others and C-429/08, Karen Murphy v Media Protection Services Ltd [2011] ECR I-09083, the reproduction right for authors: extends to transient fragments of the works within the memory of a satellite decoder and on a television screen, provided that those fragments contain elements which are the expression of the authors’ own intellectual creation, and the unit composed of the fragments reproduced simultaneously must be examined in order to determine whether it contains such elements. Acts of reproduction such as those at issue in Case C-403/08, which are performed within the memory of a satellite decoder and on a television screen, fulfil the conditions laid down in Article 5(1) of Directive 2001/29 and may therefore be carried out without the authorisation of the copyright holders concerned.

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2.

3.

Member States shall provide for the exclusive right to authorise or prohibit the making available to the public, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them: (a) for performers, of fixations of their performances; (b) for phonogram producers, of their phonograms; (c) for the producers of the first fixations of films, of the original and copies of their films; (d) for broadcasting organisations, of fixations of their broadcasts, whether these broadcasts are transmitted by wire or over the air, including by cable or satellite. The rights referred to in paragraphs 1 and 2 shall not be exhausted by any act of communication to the public or making available to the public as set out in this Article.

SELECTED RECITALS (23) This Directive should harmonise further the author’s right of communication to the public. This right should be understood in a broad sense covering all communication to the public not present at the place where the communication originates. This right should cover any such transmission or retransmission of a work to the public by wire or wireless means, including broadcasting. This right should not cover any other acts. (24) The right to make available to the public subject-matter referred to in Article 3(2) should be understood as covering all acts of making available such subject matter to members of the public not present at the place where the act of making available originates, and as not covering any other acts. (25) The legal uncertainty regarding the nature and the level of protection of acts of on-demand transmission of copyright works and subject-matter protected by related rights over networks should be overcome by providing for harmonised protection at Community level. It should be made clear that all rightholders recognised by this Directive should have an exclusive right to make available to the public copyright works or any other subject-matter by way of interactive on-demand transmissions. Such interactive on-demand transmissions are characterised by the fact that members of the public may access them from a place and at a time individually chosen by them. (26) With regard to the making available in on-demand services by broadcasters of their radio or television productions incorporating music from commercial phonograms as an integral part thereof, collective licensing arrangements are to be encouraged in order to facilitate the clearance of the rights concerned. (27) The mere provision of physical facilities for enabling or making a communication does not in itself amount to communication within the meaning of this Directive. (29) The question of exhaustion does not arise in the case of services and on-line services in particular. This also applies with regard to a material copy of a work or other subject-matter made by a user of such a service with the consent of the rightholder. Therefore, the same applies to rental and lending of the original and copies of works or other subject-matter which are services by nature. Unlike CD-ROM or CD-I, where the intellectual property is incorporated in a material medium, namely an item of goods, every on-line service is in fact an act which should be subject to authorisation where the copyright or related right so provides.

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I. COMMENTARY 1. Introduction Article 3 of the Directive transposes into EU law Article 8 WCT and Articles 10 and 14 WPPT. In 11.14 fact, it harmonises the right of ‘communication to the public’ and introduces the right of ‘making available to the public’ for authors and for the four types of related rights holders (i.e. performers, phonogram producers, producers of the first fixations of films and broadcasting organisations). In other words it extends the ‘making available to the public’ right to cover two more types of related rights holders in comparison to the WPPT (i.e. producers of the first fixations of films and broadcasting organisations). Article 3(2) also extends this right to cover audiovisual works (apart from audio works only that are covered by the WPPT). Although the communication right17 is not granted (under Art. 3) to related rights holders, performers, phonogram producers and broadcasting organisations may rely on Article 8 of the Rental and Lending Rights Directive and on Article 4 of the Satellite and Broadcast Directive, whose provisions remain intact from the Information Society Directive. Yet, producers of the first fixations of films are not covered. Both rights (i.e. the communication right and the right of making available to the public) constitute 11.15 exclusive rights.

2. The right of communication to the public The notion of ‘authors’ is not defined in the Directive. Therefore anyone who is considered an 11.16 author according to the national law of an EU Member State is covered by the Directive. The right of communication to the public has been partly regulated in the past. In fact, it has been 11.17 harmonised for databases (Art. 5(d) of the Database Directive) and for satellite broadcasting (Art. 2 of the Satellite and Cable Directive). These provisions remain intact. However, to the extent that they have not been fully harmonised, they are supplemented by Article 3 of the Information Society Directive. The ‘right of communication to the public’ should be construed broadly. It is an ‘umbrella right’, 11.18 which encompasses all non-tangible disseminations or transmissions of the work to the public by wire or wireless means and always in cases where the public is not present at the place where the transmission originates (see also Recital 23). Some sort of ‘transmission’ (or retransmission) is necessary in order for ‘communication to the public’ to take place.18 In fact it is characterised by a distance element in the sense that the transmission originates from one place and is received in another. It includes TV and radio broadcasting, internet TV and radio, simulcasting, webcasting,

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Meaning the remainder of the communication right if the right of making available to the public is omitted (since the latter is provided for related rights holders). See Joined Cases C-403/08 Football Association Premier League Ltd and Others v QC Leisure and Others and C-429/08, Karen Murphy v Media Protection Services Ltd according to which (para 193) ‘the concept of communication must be construed broadly, as referring to any transmission of the protected works, irrespective of the technical means or process used’ (emphasis added). See also Recital 23 and the reasoning of the European Copyright Society, Opinion on The Reference to the CJEU in Case C-466/12 Svensson, 15 February 2013, 2 et seq., https://ssrn.com/abstract=2220326. Note, however, that by reference to hyperlinks the CJEU did not elaborate on the transmission of content as an essential element of the communication right. See Svensson v Retriever Sverige AB (Case C-466/12) [2014] EUECJ C-466/12. See also Stamatoudi, ‘“Linking”, “Framing” and “Browsing”. The EU Court of Justice’s recent case law’, in G. Karnell et al.; Stamatoudi, ‘“Linking” and “Browsing” in the light of the EU Court of Justice’s recent case law’ in Pistorius (ed).

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streaming, near-video-on-demand (NVOD), pay-per-view, near-on-demand-pay TV, podcasting as well as cable and online transmissions in general.19 11.19 It does not include cases where the transmission/communication originates from the same place and at the same time as the location of the public; this is considered to be public performance, recitation or display. If the right of communication is construed narrowly (as the case should be) and the transmission, for example, takes place in a room adjacent to the one where the transmission originates and technical means are used to transmit and display the signal in that other room through screens or loudspeakers, then it is not ‘public performance’ which is at stake but rather ‘communication to the public’.20 11.20 According to the CJEU’s case law ‘communication to the public’ also covers the transmission of broadcast works, via a television screen and speakers, to the customers present in a public house (Joined Cases C-403/08 and C-429/08)21 or a spa establishment (Case C-351/12)22 or rehabilitation centre (Case C-117/15) and the retransmission of works included in a terrestrial television broadcast (a) where the retransmission is made by an organisation other than the original broadcaster, (b) by means of an internet stream made available to the subscribers of that other organisation who may receive that retransmission by logging on to its server, (c) even though those subscribers are within the area of reception of that terrestrial television broadcast and may lawfully receive the broadcast on a television receiver. It is irrelevant whether the retransmission is funded by advertising and is therefore of a profit-making nature or whether it is made by an organisation, which is acting in direct competition with the original broadcaster (Case C-607/11).23 11.21 The mere provision of physical facilities (hardware infrastructure and material equipment) for enabling or making a communication to the public does not in itself constitute a ‘communication to the public’ (Recital 27).24 In C-136/09 the CJEU provided that ‘a hotel operator, by installing televisions in his hotel rooms and by connecting them to the central antenna of the hotel, thereby, and without more, carries out an act of communication to the public […]’.25 This act does not 19

20 21 22 23

24

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In C-607/11 ITV Broadcasting Ltd, ITV 2 Ltd, ITV Digital Channels Ltd, Channel 4 Television Corporation, 4 Ventures Ltd, Channel 5 Broadcasting Ltd, ITV Studios Ltd v TV Catchup Ltd [2013] EUECJ C-607/11, the CJEU provided that the retransmission via the internet of works included in terrestrial TV broadcasts should be considered as ‘communication to the public’. See Bechtold, 360. Ibid. Case C-351/12, OSA – Ochranný svaz autorský pro práva k dílům hudebním o.s. v Léčebné lázně Mariánské Lázně a.s. [2014] EUECJ C-351/12. That means that rights owners can prohibit the communication to the public of their content via third-party internet stream to the extent that this content has previously been authorised for communication via analogue means, C-607/11 ITV Broadcasting Ltd, ITV 2 Ltd, ITV Digital Channels Ltd, Channel 4 Television Corporation, 4 Ventures Ltd, Channel 5 Broadcasting Ltd, ITV Studios Ltd v TV Catchup Ltd [2013] EUECJ C-607/11. See also Case C-416/12, Wikom Elektrik GmbH v VG Media Gesellschaft zur Verwertung der Urheber- und Leistungsschutzrechte mbH and Case C-351/12, Ochranný svaz autorský pro práva k dílům hudebním o.s. v Léčebné lázně Mariánské Lázně a.s [2014] EUECJ C-351/12. Recital 27 is based on the first part of Agreed Statement concerning Art. 8 WCT according to which ‘[i]t is understood that the mere provision of physical facilities for enabling or making a communication does not in itself amount to communication within the meaning of this Treaty or the Berne Convention’. Case C-136/09 Organismos Sillogikis Diacheirisis Dimiourgon Theatrikon kai Optikoakoustikon Ergon v Divani Akropolis Anonimi Xenodocheiaki kai Touristiki Etaireai [2010] ECR I-37 confirming C-306/05 Sociedad General de Autores y Editores de España (SGAE) v Rafael Hoteles SA [2006] ECR I I-11519. This outcome has been confirmed in Case C-162/10 Phonographic Performance (Ireland) Ltd v Ireland and Attorney General [2012] EUECJ C-162/10, according to which: a hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal is a ‘user’ making a ‘communication to the public’ of a phonogram which may be played in a broadcast for the purposes of Article 8(2) of the Rental and Lending Rights Directive and:

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constitute a mere provision of material means. That would be the case if the hotel operator had just bought or rented television sets from a retailer. The reference to ‘mere provision of physical facilities’ also implies the facilities offered by internet 11.22 service providers (ISPs). This, of course, does not preclude the instance where ISPs could be held secondarily/contributorily liable for copyright infringement.26 The provision of software, which enables the exchange of files over the internet, will likely be considered to constitute more than just mere provision of physical facilities.27 According to Case C-135/1028 the concept of ‘communication to the public’29 does not cover the 11.23 broadcasting, free of charge, of phonograms within private dental practices engaged in professional economic activity for the benefit of patients of those practices and enjoyed by them without any active choice on their part.30 There are various other instances that are not covered by the right of communication to the public. 11.24 The right does not cover the television broadcasting of a graphic user interface (GUI),31 while it remains unclear whether it covers communicating works to the public by satellite packagers.32 It also does not cover live broadcasting and the act of merely receiving the work privately.33 Hiring out of motor vehicles equipped with radio receivers does not constitute a communication to the public within the meaning of Article 3(1) of Directive 2001/29/EC and Article 8(2) of Directive 2006/115/EC on rental right and lending right. As noted by the Court in Case C-753/18 Föreningen Svenska Tonsättares Internationella Musikbyrå u.p.a. (Stim) [2020] EUECJ C-753/18, the expression ‘communication to the public’ in the two abovementioned provisions must be interpreted ‘in the light of the equivalent concepts contained in the texts of international law and in

A hotel operator which provides in guest bedrooms, not televisions and/or radios to which it distributes a broadcast signal, but other apparatus and phonograms in physical or digital form which may be played on or heard from such apparatus, is a ‘user’ making a ‘communication to the public’ of a phonogram within the meaning of Article 8(2) of Directive 2006/115/EC. It is therefore obliged to pay ‘equitable remuneration’ under that provision for the transmission of those phonograms. 26

27 28 29 30 31 32

See I. Stamatoudi ‘ACTA, internet service providers and the acquis communautaire ’, in J. Rosén, (ed.), Intellectual Property at the Crossroads of Trade, ATRIP Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/ Northampton (US), 2012, 237; I. Stamatoudi ‘Data protection, secrecy of communications and copyright protection. Conflicts and convergences. The example of Promusicae v Telefonica ’, in I. Stamatoudi (ed.), Copyright Enforcement and the Internet, Information Law Series, Hugenholtz, B. (general ed.), Kluwer Law International, 2010, 199; I. Stamatoudi, ‘The role of Internet Service Providers. Ethics, reality and the law: The example of Promusicae v Telefonica ’, 8th International Conference, Computer Ethics: Philosophical Enquiry, Ionio University, Corfu, 26–28 June 2009, Nomiki Vivliothiki, Athens, 2009, 750. Walter and von Lewinski, 979. C-135/10 Società Consortile Fonografici (SCF) v Marco Del Corso [2012] EUECJ C-135/10. For the purposes of Art. 8(2) of the Rental and Lending Rights Directive. Therefore such an act of transmission, according to the Case C-135/10, did not entitle the phonogram producers to the payment of remuneration. Case C-393/09 Bezpecˇnostní softwarová asociace – Svaz softwarové ochrany v Ministerstvo kultury [2010] ECR I-13971. See Joined Cases C-431/09 Airfield and Canal Digitaal v Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (Sabam), and C-432/09 Airfield NV v Agicoa Belgium BVB [2011] ECR I-09363: Article 2 of Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission must be interpreted as requiring a satellite package provider to obtain authorisation from the right holders concerned for its intervention in the direct or indirect transmission of television programmes, such as the transmission at issue in the main proceedings, unless the right holders have agreed with the broadcasting organisation concerned that the protected works will also be communicated to the public through that provider, on condition, in the latter situation, that the provider’s intervention does not make those works accessible to a new public.

33

Case C-279/13 C More Entertainment [2015] EUECJ C-279/13 and Joined Cases C-403/08 and C-429/08 Football Association Premier League Ltd and Others v QC Leisure and Others (C-403/08) and Karen Murphy v Media Protection Services Ltd [2011] ECR I-9083.

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such a way that it is consistent with them, also taking account of the context in which those concepts are found and the purpose of the relevant provisions of the agreements as regards intellectual property’ (Recitals 28–29). This concept includes two cumulative criteria: an act of communication of a work and its communication of that work to a public. In relation to the act of communication the Court emphasised the indispensable role played by the user and the deliberate nature of his intervention. That user makes an ‘act of communication’ when he intervenes, in full knowledge of the consequences of his action, to give his customers access to a protected work, particularly where, in the absence of that intervention, those customers would not be able to enjoy the broadcast work, or would be able to do so only with difficulty (see, inter alia, judgments of 15 March 2012, SCF, C-135/10, EU:C:2012:140, para. 82 and the case law cited; of 15 March 2012, Phonographic Performance (Ireland), C-162/10, EU:C:2012:141, para. 31; and of 14 June 2017, Stichting Brein, C-610/15, EU:C:2017:456, para. 26 and the case law cited).34 The mere provision of physical facilities for enabling or making a communication does not in itself amount to an act of communication. That also applies in the case of the supply of a radio receiver forming an integral part of a hired motor vehicle, which makes it possible to receive, without any additional intervention by the leasing company, the terrestrial radio broadcasts available in the area in which the vehicle is located.35

3. The right of ‘making available to the public’ 11.25 Part of the ‘communication to the public’ is also the right of ‘making available’.36 That means that the latter should be interpreted consistently with the communication right and that it is also subject the same limitations and exceptions.37 The characteristic of this right is that works (or subject matter) are made available in such a way that members of the public may access them from a place and at a time individually chosen by them (on demand). As clarified in Case 279/13 C More Entertainment AB v Linus Sandberg [2015] EUECJ C-279/13, paras 24 and 26, ‘the concept of “making available to the public” forms part of the wider “communication to the public” and “making available to the public” is intended to refer to “interactive on-demand transmissions” characterised by the fact that members of the public may access them from a place and at a time individually chosen by them’. Transmissions broadcast live on the internet are not included. The right does not require a simultaneous addressing of the public or that the public is gathered in a particular place or that a pre-established programme is provided.38 The form in which the works are made available to the public does not matter. They can be offered for download or via streaming.39 It is also technologically neutral in the sense that one may use any technological means to access the work

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Para. 32 of the judgment. Paras 33–4 of the judgment. Joined Cases C-403/08 and C-429/08 Football Association Premier League Ltd and Others v QC Leisure and Others [2011] ECR I-9083, para. 171; also see Case C-279/13 C More Entertainment AB v Linus Sandberg, [2015] EUECJ C-279/13, para. 24: ‘the concept of “making available to the public”, also used in Article 3(2) of that directive, forms part of the wider “communication to the public”’. The making available right constitutes an implementation of the 1996 WIPO Treaties into EU law. It is, however, not defined in the Information Society Directive or the 1996 WIPO Treaties Study on the Application of Directive 2001/29/EC on Copyright and Related Rights in the Information Society, De Wolf & Partners in collaboration with Crids, 2013, at 27–8. These are also the differences between the making available right and the broadcasting right. In the case of broadcasting even when the user selects the place and time to use the work, transmission and use are simultaneous. Also, the programme available is usually a predetermined continuous programme. See a case by the Criminal Court of Stuttgart (OLG Stuttgart 21 January 2008, Az. 2 WS 328/07; 2 Ws 328/2007, Telemedicus, http://tlmd.in/u/488) where it was decided that in relation to a streaming service for songs it did not matter that the user was not able to make a permanent copy of the works and that the making available right does require that the user makes a new fixation of the recording, as referred to in the Study on the Application of Directive 2001/29/EC on Copyright and Related Rights in the Information Society, De Wolf & Partners in collaboration with Crids, 2013, at 39.

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such as mobile, iPod, iPad, tablet, fixed or wi-fi internet connection and so on.40 Also it is not a requirement that members of the public access the work. It is the act of providing the work to the public that is crucial as well as the possibility for members of the public to access the work when they choose/at their own initiative (on demand). It is also understood that the public should not be present at the place where the act of making available originates.41 It is irrelevant whether or how many times the work is actually accessed or the type of use intended (e.g. whether the work (or subject matter) is made available for viewing, listening or downloading). Also this right is relevant for the person (or entity) that makes the work accessible to the public and not for the member of the public that accesses the work. The act of the latter will probably be covered by the right of reproduction unless it is exempted by an exception or limitation. There is the view that ‘transmission’ itself is not covered by the ‘making available’ right.42 According 11.26 to M. Walter and S. von Lewinski: copies generated in the course of the signal transport or with the end-user in browsing are subject to authorization or may be free on the grounds of an exception provided for in the Directive or under national law respectively. Thus, transient or incidental copies generated in transmitting copyright subject matter by an intermediary or by a lawful end-user in browsing are free according to the mandatory exception of article 5(1) of the Directive. On the other hand, the listening, viewing, or downloading of copyright material by the end-user may be permitted under the private use exception anchored in article 5(2)(b) of the Directive.43

Yet, there are others who believe that the whole act of communication is covered by the making available right including the upload and the entire transmission to the download.44 The CJEU in its decision in Sportradar45 in relation to the interpretation of the re-utilisation right for databases (Art. 7 of the Database Directive) it provided that the act of ‘re-utilisation’ takes place in an EU Member State where there is evidence from which it may be concluded that the act discloses an intention on the part of the person performing it to target members of the public in that Member State. Although this was not an ad hoc decision, it still sheds some light on the issue.

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Walter and von Lewinski, 978 and 983. Recital 24 of the Information Society Directive and Case C-403/08 Football Association Premier League Ltd and Others v QC Leisure and Others [2011] ECR I-9083, paras 200 et seq. and Case C-238/10 Circul Globus Bucures¸ti (Circ & Variete Globus Bucures¸ti) v Uniunea s¸i Muzicologilor din România – Asociaţia pentru Drepturi de Autor (UCMR – ADA) [2011] ECR I-12031. Walter and von Lewinski, 983. See also J. Reinbothe and S. von Lewinski, The WIPO Treaties 1996, Butterworths, Lexis Nexis, London, 2002, where it is indicated that this question is controversial. Walter and von Lewinski, 983. See also A. Ohly, “Economic rights” in E. Derclaye (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2009, 225; M. Schlesinger, “Legal issues in peer-to-peer file sharing, focusing on the making available right” in A. Strowel (ed), Peer-to-peer File Sharing and Secondary Liability in Copyright Law, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2009, 47, 68; Study on the Application of Directive 2001/29/EC on Copyright and Related Rights in the Information Society, De Wolf & Partners in collaboration with Crids, 2013, 338. A. Peukert, ‘Territoriality and extraterritoriality in intellectual property law’ in G. Handl and J. Zekoll (eds), Beyond Territoriality: Transnational Legal Authority in an Age of Globalization Queen Mary studies in international law, Brill Academic Publishing, Leiden/Boston, 2011, http://ssrn.com/abstract=1592263, at 17. See also J. Reinbothe and S. von Lewinski, The WIPO Treaties 1996, Butterworths, London, 2002,108. C-173/11 Football Dataco Ltd and Others v Sportradar GmbH et Sportradar AG, [2012] EUECJ C-173/11 , which provides that: Article 7 of [the Database Directive] must be interpreted as meaning that the sending by one person, by means of a web server located in Member State A, of data previously uploaded by that person from a database protected by the sui generis right under that directive to the computer of another person located in Member State B, at that person’s request, for the purpose of storage in that computer’s memory and display on its screen, constitutes an act of ‘re-utilisation’ of the data by the person sending it. That act takes place, at least, in Member State B, where there is evidence from which it may be concluded that the act discloses an intention on the part of the person performing the act to target members of the public in Member State B, which is for the national court to assess.

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11.27 ‘Making available to the public’ covers all on-demand services such as video on demand, pay per view TV, the selection of works (or subject matter) from online databases of, for example, films or songs where one can retrieve a work with the aid of a search engine or special software and chooses the time and place to use it. This right even applies in cases where one can choose works incorporated in broadcasts, which are available online to the extent that it is not the broadcast as such that one selects from a variety of broadcasts but rather the works in it.46 Podcasts where the user chooses to access a work from pre-existing materials are also covered by the ‘making available’ right.47 If one cannot choose when and where to retrieve a work then it is not the right of ‘making available to the public’ that applies but rather the right of ‘communication to the public’. Such examples are broadcasting, simulcasting, webcasting, streaming and near-video-on-demand (NVOD) services. 11.28 The ‘making available’ right also covers services relating to works whose legal protection has already been regulated by means of a Directive within the EU irrespective of the fact that the Information Society Directive provides that these (earlier Directives) remain intact. Therefore the right of ‘making available to the public’ also applies to computer programs and to copyright databases.48 11.29 An interesting development following the introduction of the Digital Single Market Directive (Art. 17) is that online content-sharing providers are deemed to perform an act of communication to the public or an act of making available to the public for the purposes of this Directive when they give the public access to copyright-protected works or other protected subject matter uploaded by their users. This means that these providers are primarily liable for acts of copyright infringement. The relationship of Article 17 to the CJEU case law on communication to the public is presently unclear.

4. Hypertext links and cloud services 11.30 Hypertext linking is generally not considered to come either under the ‘making available’ right or under the ‘communication’ right.49 It may, however, constitute, for the party providing the link (and in case this link facilitates the infringement of copyright or related rights) a contribution to an infringement.50 However links may be relevant in relation to cloud services. The mere upload of

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If it is broadcasts that are selected rather than works it is ‘rebroadcasting’ which is at issue rather than the right of making available to the public. The distinction between these two rights carries considerable legal weight since the making available right is an exclusive right while in the case of broadcasting performers and phonogram producers can only claim equitable remuneration (Art. 8(2) Rental and Lending Rights Directive). In addition in case of broadcasting special provisions apply (Arts 9–12 Satellite and Cable Directive) and the organiser of such a broadcasting activity enjoys a related right under the Rental and Lending Rights Directive as well as under the Information Society Directive. It is contested whether ‘push services’ (such as email services) whose transmission is controlled by the provider of the content come under the making available right or not. The prevailing view seems to be that since the transmission is controlled by the content provider rather than the end-user the making available right does not apply. It also contested whether it is the communication right that applies or the right or reproduction or even distribution (irrespective of the fact that distribution generally applies to tangible rather intangible copies of works). This is so because the communication right is not dealt with under the Computer Program Directive and therefore the Information Society Directive applies. The communication right for copyright databases is dealt with under Art. 5(d) of the Database Directive. Bechtold, 361. See Verlagsgruppe Handelsblatt GmbH v Paperboy, Bundesgerichtshof No 1 ZR 259/00, 17 July 2003, [2005] ECDR 7. Bechtold, 358 and 361; Walter and von Lewinski, 985. In Germany the Federal Court of Justice held in 2003 that linking to a third-party’s website (hypertext link) is no communication to the public and therefore does not infringe copyright (Federal Court of Justice, Decision of 17 July 2003, No. I ZR 259/00, ‘Paperboy ’). In a decision of 8 November 2011, the Court of Appeal of Düsseldorf affirmed the infringement of the right to communicate a work to the public by embedded content (Court of Appeal of Düsseldorf, Decision of 8 November 2011, No. I-20 U 42/11). Yet in its decision of 16 March 2012 the Court of Appeal of Cologne held that the access to infringing content by a frame (framing) was no communication to the public (Court of Appeal of Cologne, Decision of 16 March 2012, No. 6 U 206/11). See also a somehow differing position in Supreme Court, 15 June 2000, Tommy Olsson (Sweden) and Court of Appeal, 3 March 2004, Napster.no (Norway) and Western High Court, 20 April 2001 (Denmark) where it was

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works to a cloud service (i.e. the storage of works on the service provider’s server) is not considered an act of making a work available to the public. An act of making available is performed at the earliest at the moment when the links to the content are shared via the internet with third parties, as a part of a download link collection.51 According the opinion of the European Copyright Society52 in view of the judgment in case 11.31 C-466/12 Svensson,53 which is currently pending before the CJEU, hyperlinking in general should be regarded as an activity that is not covered by the right to communicate the work to the public for three reasons: Hyperlinks are not communications because establishing a hyperlink does not amount to ‘transmission’ of a work, and such transmission is a prerequisite for ‘communication’; (b) Even if transmission is not necessary

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mentioned that a hyperlink to a work may constitute ‘making a work available to the public’. However, Denmark provides for a particularly broad ‘making available’ right which also encompasses the right of distribution, public performance and exhibition. In the Netherlands see the case Mom v. VNU, Arrondissementsrechtbank Haarlem – 22 March 2006, 2006 AMI 136, where the Court decided that the publication of the articles of a journalist on distinct websites amounted to distinct acts of ‘communication to the public’ and ‘making available to the public’ especially because they did not constitute simple hypertext links or deep links to another site. Mere hypertext links though (in the form of surface links) were not considered to constitute acts of ‘making available to the public’. In another Dutch case (Rb Haarlem 17 August 2011, case nr 173726/HA ZA 10–1325, http://ie-forum.nl/index.php?//Onlosmakelijk+ daaraan+verbonden+antwoorden////28941/) it was decided that an act of communication to the public was performed in relation to educational works that were made available to viewers of a particular website via hyperlinks provided on that site by its owner (teacher). In the case at issue it was not only the provisions of hyperlinks that was at stake but also the fact that the website owner not only provided links to the works but also stored the works on the server and controlled whether the works remained available. The case was appealed and the Court of Appeal disputed some of the facts at issue. It still however confirmed the decision of the Court of First Instance (Court of appeal of Amsterdam 15 January 2013 (case nr 200.095.838/01), http://ie-forum.nl/index.php?//Eenvoudige+hyperlink+naar+antwoordboeken+en+ uitwerkingen+ onrechtmatig////31097/and www.rechtspraak.nl. For more information on links see A. Strowel and V. Hanley, ‘Secondary liability for copyright infringement with regard to hyperlinks’, in A. Strowel (ed), Peer-to-peer File Sharing and Secondary Liability in Copyright Law, 81. See Schneider, A., ‘OLG Hamburg: Die Rapidshare-Entscheidung, ein Meilenstein?’ Telemedicus, 29 March 2012. And Press Release ‘Urheberrechtswidrige Downloads: Oberlandergericht Hamburg entscheidet über Prüf- und Handlungspflichten des Online-Speicher-Dienstes Rapidshare’, 15 March 2012. See also the case Sanoma Media, Playboy Enterprises International and X v GS Media (GeenStijl), Rb. Amsterdam 12 September 2012. In this last case the court found that the mere publication of a hyperlink does not constitute an act of communication to the public unless a certain ‘intervention’ takes place and a ‘new public’ and a ‘profitable intent’ are there. As these sources are all referred to in the Study on the Application of Directive 2001/29/EC on Copyright and Related Rights in the Information Society, De Wolf & Partners in collaboration with Crids, 2013, at 35. See also the views expressed by the European Copyright Society, Opinion on The Reference to the CJEU in Case C-466/12 Svensson, 15 February 2013, http://www.ivir.nl/news/European_Copyright_Society_Opinion_on_ Svensson.pdf. In Case C-466/12, Svensson and Others, one of the four Swedish Courts of Appeal addressed to the CJEU the following questions: 1. 2. 3.

4.

If anyone other than the holder of copyright in a certain work supplies a clickable link to the work on his website, does that constitute communication to the public? Is the assessment under question 1 affected if the work to which the link refers is on a website on the Internet which can be accessed by anyone without restrictions or if access is restricted in some way? When making the assessment under question 1, should any distinction be drawn between a case where the work, after the user has clicked on the link, is shown on another website and one where the work, after the user has clicked on the link, is shown in such a way as to give the impression that it is appearing on the same website? Is it possible for a Member State to give wider protection to authors’ exclusive right by enabling ‘communication to the public’ to cover a greater range of acts than provided for in Article 3(1) of the Information Society Directive?

Other cases that have discussed hypertext links and embedded material are Case C-279/13 C More Entertainment, [2015] EUECJ C-279/13, referred by the UK Supreme Court and Case C-348/13 BestWater International GmbH v Michael Mebes, Stefan Potsch [2014] EUECJ C-348/13, concerning the embedding of videos by the German Supreme Court; Case C-527/15 Stichting Brein v Jack Frederik Wullems [2017] EUECJ C-527/15, concerning pre-installed add-ons containing hyperlinks to websites by the District Court of Central Netherlands.

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Chapter 11 THE INFORMATION SOCIETY DIRECTIVE for there to be a ‘communication’, the rights of the copyright owner apply only to communication to the public ‘of the work’, and whatever a hyperlink provides, it is not ‘of a work’; (c) Even if a hyperlink is regarded as a communication of a work, it is not to a ‘new public’. This does not mean that creating hyperlinks in no circumstances involves liability. In fact, as is clear from national case-law, different forms of hyperlinking may indeed give rise to the following forms of liability (a) Accessory liability (particularly in respect of knowingly facilitating the making of illegal copies); (b) Unfair competition; (c) Infringement of moral rights; (d) Circumvention of technological measures.54

11.32 This is not the approach that the CJEU adopted in Case C-466/12 Svensson, however. The CJEU held that the concept of communication to the public includes two cumulative criteria, namely, (a) an ‘act of communication’ of a work and (b) the communication of that work to a ‘public’. Regarding the first criterion, namely the existence of an ‘act of communication’, this must be construed broadly to ensure a high level of protection for copyright holders. The Court observed that the provision of clickable links to protected works published without any access restrictions affords users of the first website direct access to those works, which amounts to an act of communication. However, because the content was made freely available to the public, namely all internet users and, as a result, the relevant activity was not addressed to a new public, the activity in question was found not to amount to an act of communication. 11.33 This position was affirmed in other CJEU cases. In Case C-348/13 BestWater International GmbH v Michael Mebes, Stefan Potsch [2014] EUECJ C-348/13 the CJEU held that the embedding, within one’s own website, of another person’s work made available to the public on a third-party website, by means of a link using the framing technology does not by itself amount to an act of communication to the public, insofar as the work concerned is neither directed to a new public nor communicated by using specific technical means that differ from that used for the initial communication. In Case C-160/15 GS Media BV v Sanoma Media Netherlands BV, Playboy Enterprises International Inc, Britt Geertruida Dekker [2016] EUECJ C-160/15, the CJEU held that the determination of whether posting hyperlinks to protected works, which are freely available online without the consent of the copyright holder, is an act of ‘communication to the public’, should take into account whether those links are provided without the pursuit of financial gain by a person who did not know or could not reasonably have known the illegal nature of the publication of those works on that other website or whether, on the contrary, those links are provided for such a purpose, a situation in which that knowledge must be presumed.

5. The notion of ‘public’ 11.34 The notion of public is not defined in the Directive or any other relevant EU legal instrument. Although this term is not harmonised (and is thus left to the laws and courts of the Member States) it should be construed in an autonomous and uniform manner throughout the Community.55 That

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European Copyright Society, 2. Case C-128/11 UsedSoft GmbH v Oracle International [2012] EUECJ C-128/11, para. 39, According to settled case-law, the need for a uniform application of European Union law and the principle of equality require that the terms of a provision of European Union law which makes no express reference to the law of the Member States for the purpose of determining its meaning and scope must normally be given an independent and uniform interpretation throughout the European Union (see, inter alia, Case C-5/08 Infopaq International [2009] ECR I-6569, paragraph 27; Case C-34/10 Brüstle [2011] ECR I-9821, paragraph 25; and Case C-510/10 DR and TV2 Danmark [2012] 26 April 2012, not yet published, (paragraph 33). See also Case C-306/05 SGAE [2006] ECR I-11519 (para. 34) where it is provided that in ‘interpreting a provision of Community law it is necessary to consider not only its wording, but also the context in which it occurs and the objectives pursued by the rules of which it is part’ and; it should be noted that the need for uniform application of Community law and the principle of equality require that where provisions of Community law make no express reference to the law of the Member States for the purpose of

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means that the notion of public cannot be broad enough so as to impinge on the legitimate interests of authors or related rights holders.56 Member States usually consider it as encompassing any circle of persons larger than the narrow 11.35 circle of family and friends, or larger than the immediate social environment.57 The CJEU has described it in Lagardère58 (by reference to MediaKabel 59) and in PPI 60 as ‘an indeterminate number of potential listeners’; in Rafael Hoteles61 as ‘an indeterminate number of potential television viewers’; and in Marco Del Corso62 ‘persons in general, that [are] not restricted to specific individuals belonging to a private group’. We could also define ‘public’ as any use that cannot be considered ‘private’.63, 64 The concept of the ‘public’ involves a certain de minimis threshold, excluding groups of

determining their meaning and scope, as is the case with Directive 2001/29/EC, they must normally be given an autonomous and uniform interpretation throughout the Community (see, in particular, Case C-357/98 Yiadom [2000] ECR I-9265, paragraph 26, and Case C-245/00 SENA [2003] ECR I-1251, paragraph 23) (para. 31). 56

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See in this respect Recital 23 where it is provided that ‘[the communication] right should be understood in a broad sense covering all communication to the public not present at the place where the communication originates’ and Recitals 9 and 10 where it is provided that any harmonisation of copyright and related rights must take as a basis a high level of protection and that right holders should receive an appropriate reward for the use of their works. I. Stamatoudi, ‘Article 3’ in L. Kotsiris and I. Stamatoudi, Comments on Greek Copyright Law, Sakkoulas Publications, Athens, Thessaloniki, 2009 (2nd ed., 2012) and I. Stamatoudi and G. Koumantos, ‘Greek Copyright Law’ in Geller, P.E. (ed.) International Copyright Law and Practice, Matthew Bender, US, 2014, 114. Case C-192/04 Lagardère Active Broadcast v Société pour la perception de la rémunération équitable (SPRE) and Gesellschaft zur Verwertung von Leistungsschutzrechten mbH (GVL) [2005] ECR I-7199. Case C-89/04 Mediakabel BV v Commissariaat voor de Media [2005] ECR I-4891. Case C-162/10 Phonographic Performance (Ireland) Ltd v Ireland and Attorney General, [2012] EUECJ C-162/10. C-306/05 Sociedad General de Autores y Editores de España (SGAE) v Rafael Hoteles SA [2006] ECR I I-11519, para. 40. In the same case (as well as in Premier League and in Marco Del Corso) the Court with regard to the profit-making nature of the communication to the public also referred to the fact that ‘the public which is the subject of communication is both targeted by the user and receptive, in one way or another, to that communication, and not merely “caught” by chance’. See the references from and discussion in the Study on the Application of Directive 2001/29/EC on Copyright and Related Rights in the Information Society, De Wolf & Partners in collaboration with Crids, 2013, at 39–40. C-135/10 Società Consortile Fonografici (SCF) v Marco Del [2012] EUECJ C-135/10, para. 85. In the same case the Court also interpreted the requirement of a ‘fairly large number of people’ as being intended to indicate that the ‘concept of public encompasses a certain de minimis threshold, which excludes from the concept groups of persons which are too small or insignificant’. See the Study on the Application of Directive 2001/29/EC on Copyright and Related Rights in the Information Society, De Wolf & Partners in collaboration with Crids, 2013, at 40. Even if one person is to receive a transmission, this is considered to be a transmission/communication to the public to the extent that these persons are not privately interconnected with each other (as is the case in hotel rooms, private homes for works distributed over the internet and exchanged between persons (internet file sharing), hospital rooms and so on). Merely ‘private’ communications are excluded. See note 10.12 of the Basic Proposal of WCT. The CJEU has also occasionally referred to the notion of ‘new public’ in order to assess whether an act qualifies as a separate right. See Joined Cases C-431/09 Airfield and Canal Digitaal v Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (Sabam), and C-432/09 Airfield NV v Agicoa Belgium BVB [2011] ECR I-09363 and C-403/08 Football Association Premier League Ltd and Others v QC Leisure and Others [2011] ECR I-6011 para. 197 meaning a ‘public which was not taken into account by the authors of the protected works when they authorised their use by the communication to the original public’. However, this notion was somehow nuanced in C-607/11 ITV Broadcasting Ltd, ITV 2 Ltd, ITV Digital Channels Ltd, Channel 4 Television Corporation, 4 Ventures Ltd, Channel 5 Broadcasting Ltd, ITV Studios Ltd v TV Catchup Ltd, 7 March 2012, [2013] EUECJ C-607/11, paras 24, 26 and 39–40, where the Court provided that when a work is put to multiple uses, each transmission by a specific technical means must be individually authorised by the author and that a specific technical means different from the original communication technique is a communication to the public in the sense of the Information Society Directive. Each transmission must be authorised individually and separately by the authors, ‘given that each is made under specific technical conditions, using a different means of transmission for the protected works, and each is intended for a public’. It is not necessary then to examine whether a ‘new public’ can be found. Instead, the Court stated that the right of communication to the public covers a: retransmission of works included in terrestrial broadcasts, where the retransmission is made by an organisation other than the original broadcaster, by means of an internet stream made available to the subscribers of that other organisation who may receive that retransmission by logging on to its server, even though those subscribers are within

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persons that are too small, or insignificant. In addition, it takes into account the cumulative effect of making the works available. As per Case C-610/15 Stichting Brein v Ziggo BV, XS4ALL Internet BV [2017] EUECJ C-610/15, it is important to know how many persons can access the same work at the same time and how many of them have access to it in succession.

6. Exhaustion of rights 11.36 Communication to the public (including the ‘making available to the public’) refers to services rather than goods. The principle of exhaustion does not apply to services (and in particular to online services, Recital 29)65 and consequently it does not apply to these two rights (Art. 3(3)). That means that a work needs to be authorised by the author or related rights holder each time it is made available to the public. 11.37 The online provision of services should not be confused with the online transmission of works that operates as a substitute for physical distribution. A characteristic example in this respect is the download-to-own (DTO) software market where a seller authorises the download of a copy of a software program and grants a perpetual licence in return for payment. In this case the acquirer of the licence (buyer) may sell that copy freely to a third party. According to the CJEU’s Press Release66 in the C-128/11 UsedSoft case:67 the principle of exhaustion of the distribution right applies not only where the copyright holder markets copies of his software on a material medium (CD-ROM or DVD) but also where he distributes them by means of downloads from his website. Where the copyright holder makes available to his customer a copy – tangible or intangible – and at the same time concludes, in return for payment of a fee, a licence agreement granting the customer the right to use that copy for an unlimited period, that right holder sells the copy to the customer and thus exhausts his exclusive distribution right. Such a transaction involves a transfer of the right of ownership of the copy. Therefore, even if the licence agreement prohibits a further transfer, the right holder can no longer oppose the resale of that copy. The Court observes in particular that limiting the application of the principle of the exhaustion of the distribution right solely to copies of computer programs that are sold on a material medium would allow the copyright holder to control the resale of copies downloaded from the internet and to demand further remuneration on the occasion of each new sale, even though the first sale of the copy had already enabled the right holder to obtain appropriate remuneration.

the area of reception of that terrestrial television broadcast and may lawfully receive the broadcast on a television receiver (quoted from the Study on the Application of Directive 2001/29/EC on Copyright and Related Rights in the Information Society, De Wolf & Partners in collaboration with Crids, 2013, 41). The ‘new public’ criterion has also been discussed by reference to the cases concerning hyperlinks and embedded links and was deemed to function as a form of defence in cases where the initial communication was addressed to the public at large without implementing access control protocols. See also in general S. Karapapa, ‘The requirement for a “new public” in EU copyright law’ (2017) European Law Review 1, 63–81. 65

66 67

See also Case C-62/79 SA v Cine Vog Films [1980] ECR I-881 (Coditel I); Case 262/81 Coditel SA Compagnie Generale pour la Diffusion de la télévision v Ciné Vog Films (Coditel II) [1982] ECR 3381; Case C-158/86 Warner Brothers Inc and Metronome Video ApS v Erik Viuff Christiansen [1988] ECR I-02605; Case C-395/87 Ministère public v Jean-Louis Tournier [1989] ECR 2521 and Case C-61/97 Foreningen af danske Videogramdistributører, acting for Egmont Film A/S, Buena Vista Home Entertainment A/S, Scanbox Danmark A/S, Metronome Video A/S, Polygram Records A/S, Nordisk Film Video A/S, Irish Video A/S and Warner Home Video Inc v Laserdisken [1998] ECR I-5171. CJEU Press Release No 94/12, Luxembourg, 3 July 2012. Case C-128/11 UsedSoft GmbH v Oracle International Corp [2012] EUECJ C-128/11. It is interesting to note that a German decision (Landgericht Bielefeld – Case nr 4 O 191/11) held on 5.3.2013 that, because of the nature of the Software Directive as lex specialis, the reasoning in UsedSoft could not be applied to other types of works (downloadable e-books and audiobooks in that case). A similar ruling was issued by the Court of Appeal of Hamm (Oberlandesgericht Hamm), 22 U 60/13, 15.5.014. Compare the stance in the US where in Capitol Records (EMI) v ReDigi (Case No 12 Civ. 95 (RJS) 30 March 2013) the US District Court Southern District of New York ruled that the ‘first sale’ doctrine does not apply to digital goods. http://digitalcommons.law.scu.edu/cgi/viewcontent. cgi?article=1334&context= historical.

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ARTICLE 3: RIGHT OF COMMUNICATION TO THE PUBLIC OF WORKS Such a restriction of the resale of copies of computer programs downloaded from the internet would go beyond what is necessary to safeguard the specific subject-matter of the intellectual property concerned.68, 69

UsedSoft is important as it affirmed that digital exhaustion is possible by reference to computer 11.38 programs. It clarified that the resale of a user licence entailing the resale of a copy of a computer program downloaded from the copyright holder’s website, which was initially granted for an unlimited period in return for payment of a fee in order to remunerate the rights holder, the second acquirer of the licence, as well as any subsequent acquirer of it, is able to rely on the exhaustion of the distribution right under Article 4(2) of the Computer Programs Directive. However, digital exhaustion does not apply to the right of communication to the public available 11.39 under Article 3 of the Information Society Directive. The resale of ‘used’ ebooks for permanent use by means of downloading is covered by the concept of ‘communication to the public’ and, more specifically, by that of ‘making available to the public of [authors’] works in such a way that members of the public may access them from a place and at a time individually chosen by them’. This was held in Case C-263/18 Nederlands Uitgeversverbond v Tom Kabinet [2019] EUECJ C-263/18. The extent to which an act over the internet is considered to be a service rather than an online 11.40 distribution of goods is a matter of fact and should be judged on the basis of the particular characteristics of each case. It should also be noted here that Member States are free to introduce/implement into their national 11.41 laws the right of communication to the public and the right of making available to the public by other means (i.e. rights, e.g. the reproduction or distribution rights) and not necessarily by the means (names) of the rights mentioned in the Directive. What is crucial though is that these two rights should be provided in substance in the laws of the Member States.70

NOTES 1. Relevant instruments World Copyright Treaty (WCT) of 20 December 1996. WIPO Performances and Phonograms Treaty (WPPT) of 20 December 1996.

68

See Case C-128/11, para 62: the objective of the principle of the exhaustion of the right of distribution of works protected by copyright is, in order to avoid partitioning of markets, to limit restrictions of the distribution of those works to what is necessary to safeguard the specific subject-matter of the intellectual property concerned (see, to that effect, Case C-200/96 Metronome Musik [1998] ECR I-1953, paragraph 14; Case C-61/97 FDV [1998] ECR I-5171, paragraph 13; and Football Association Premier League and Others, paragraph 106).

69

In Case C-128/11, it was held that Art. 4(2) of the Computer Programs Directive allows the exhaustion of the distribution of copies of a computer program: if the copyright holder who has authorised, even free of charge, the downloading of that copy from the internet onto a data carrier has also conferred, in return for payment of a fee intended to enable him to obtain a remuneration corresponding to the economic value of the copy of the work of which he is the proprietor, a right to use that copy for an unlimited period.

70

In addition, the Court held that Arts 4(2) and 5(1) of the Computer Programs Directive 2009/24 have the meaning that a second acquirer of a licence that grants access to a computer program for an unlimited time, as well as any subsequent acquirer of it, will be able to rely on the exhaustion of the distribution right, and hence be regarded as lawful acquirers of a copy of a computer program and benefit from the right of reproduction provided for in Art. 5(1). This is also the philosophy followed in the WCT and WPPT (known as the ‘umbrella solution’). See also Walter and von Lewinski, 982.

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Chapter 11 THE INFORMATION SOCIETY DIRECTIVE Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376/28, 27.12.2006. Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights, OJ L 290/12, 29.10.1993. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs, OJ L 111, 5.5.2009.

2. CJEU case law Airfield and Canal Digitaal v Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (Sabam) (Case C-431/09) and Airfield NV v Agicoa Belgium BVBA (Case C-432/09) [2011] ECR I-09363. BestWater International GmbH v Michael Mebes, Stefan Potsch (Case C-348/13) [2014] EUECJ C-348/13_CO. Bezpecˇnostní softwarová asociace – Svaz softwarové ochrany v Ministerstvo kultury (Case C-393/09) [2010] ECR 13971. Brüstle (Case C-34/10) [2011] ECR I-9821. C More Entertainment v Linus Sandberg (Case C-279/13) [2015] EUECJ C-279/13. Coditel SA v Cine Vog Films (Case C-62/79) [1980] ECR I-881 (Coditel I). Coditel SA Compagnie Generale pour la Diffusion de la télévision v Ciné Vog Films (Coditel II) (Case 262/81) [1982] ECR 3381. DR, TV2 Danmark A/S v NCB – Nordisk Copyright Bureau (Case C-510/10) [2012] EUECJ C-510/10. Football Association Premier League Ltd and Others v QC Leisure and Others (C-403/08) and Karen Murphy v Media Protection Services Ltd (C-429/08) [2011] ECR I-09083. Football Dataco Ltd and Others v Sportradar GmbH et Sportradar AG (Case C-173/11) [2012] EUECJ C-173/11. Föreningen Svenska Tonsättares Internationella Musikbyrå u.p.a. (Stim) and Svenska artisters och musikers intresseorganisation ek. för. (SAMI) v Fleetmanager Sweden AB and Nordisk Biluthyrning AB (Case C-753/18) [2020] EUECJ C-753/18. GS Media BV v Sanoma Media Netherlands BV, Playboy Enterprises International Inc, Britt Geertruida Dekker (Case C-160/15) [2016] EUECJ C-160/15. Infopaq International A/S v Danske Dagblades Forening (Case C-5/08) [2009] ECR I-06569. ITV Broadcasting Ltd, ITV 2 Ltd, ITV Digital Channels Ltd, Channel 4 Television Corporation, 4 Ventures Ltd, Channel 5 Broadcasting Ltd, ITV Studios Ltd v TV Catchup Ltd (Case C-607/11) [2013] EUECJ C-607/11. Metronome Musik (Case C-200/96) [1998] ECR I-1953. Ministère public v Jean-Louis Tournier (Case C-395/87) [1989] ECR 2521. Nederlands Uitgeversverbond and Groep Algemene Uitgevers v Tom Kabinet (Case C-263/18) [2019] EUECJ C-263/18. Ochranný svaz autorský pro práva k dílům hudebním, o.s. (OSA) v Léčebné lázně Mariánské Lázně, a.s. (Case C-351/12) [2014] EUECJ C-351/12. Organismos Sillogikis Diacheirisis Dimiourgon Theatrikon kai Optikoakoustikon Ergon v Divani Akropolis Anonimi Xenodocheiaki kai Touristiki Etaireai (Case C-136/09) [2010] ECR I-37. Phonographic Performance (Ireland) Limited v Ireland and Attorney General (Case C-162/10) [2012] EUECJ C-162/10. Ranks and Vasilevics (Case C-166/15) [2016] EUECJ C-166/15. Reha Training v GEMA (Case C-117/15) [2016] EUECJ C-117/15. SENA (Case C-245/00) [2003] ECR I-1251. Sociedad General de Autores y Editores de España (SGAE) v Rafael Hoteles SA (Case C-306/05) [2006] ECR I-11519. Società Consortile Fonografici (SCF) v Marco Del Corso (Case C-135/10) [2011] EUECJ C-135/10. Stichting Brein v Jack Frederik Wullems (Case C-527/15) [2017] EUECJ C-527/15. Stichting Brein v Ziggo BV (Case C-610/15) [2017] EUECJ C-610/15. Svensson v Retriever Sverige AB (Case C-466/12) [2014] EUECJ C-466/12. UsedSoft GmbH v Oracle International Corp (C-128/11) [2012] EUECJ C-128/11. Warner Brothers Inc and Metronome Video ApS v Erik Viuff Christiansen (Case C-158/86) [1988] ECR I-02605. Wikom Elektrik GmbH v VG Media Gesellschaft zur Verwertung der Urheber- und Leistungsschutzrechte mbH (Case C-416/12) OJ C379/23, 1.12.2012. Yiadom (Case C-357/98) [2000] ECR I-9265.

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3. Bibliography Dreier, T. and P.B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law International, Alphen aan den Rijn, 2006. Ficsor, M. The Law of Copyright and the Internet. The 1996 WIPO Treaties, their Interpretation and Implementation, Oxford University Press, Oxford, 2002. Karapapa, S. ‘Reconstructing copyright exhaustion in the online world’ Intellectual Property Quarterly, 2014 (4), 304–22. Karapapa, S. ‘The requirement for a “new public” in EU copyright law’, European Law Review, 2017 (1), 63–81. Reinbothe, J. and S. von Lewinski, The WIPO Treaties 1996, Butterworths, Lexis Nexis, London, 2002. Rosén, J. ‘Chapter 12: How Much Communication to the Public Is ‘Communication to the Public’?’ in Stamatoudi, I. (ed.) New Developments in EU and International Copyright Law, Kluwer Law International – Information Law Series, Volume 35, Alphen aan den Rijn, 2010, 331. Sganga, C. ‘A Plea for Digital Exhaustion in EU Copyright Law’ 9(3) JIPITEC 2019, 211. Stamatoudi, I. ‘ACTA, internet service providers and the acquis communautaire ’, in Rosén, J. (ed.), Intellectual Property at the Crossroads of Trade, ATRIP Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2012. Stamatoudi, I. ‘Data protection, secrecy of communications and copyright protection. Conflicts and convergences. The example of Promusicae v. Telefonica ’, in Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Information Law Series (Hugenholtz, B. (general ed.)), Kluwer Law International, Alphen aan den Rijn, 2010. Stamatoudi, I. ‘The Role of Internet Service Providers. Ethics, Reality and the Law: The Example of Promusicae v. Telefonica ’, 8th International Conference, Computer Ethics: Philosophical Enquiry, Ionio University, Corfu, 26–28 June 2009, Nomiki Vivliothiki, Athens, 2009. Stamatoudi, I. ‘“Linking”, “Framing” and “Browsing”. The EU Court of Justice’s recent case law”, in G. Karnell, A. Kur, P. J. Nordell, D. Westman, J. Axhamn and S. Carlsson (eds) Liber Amicorum Jan Rosen, Eddy.se ab, Halmstad, 2016, 759. Stamatoudi, I. ‘“Linking” and “browsing” in the light of the EU Court of Justice’s recent case law” in Tana Pistorius (ed.), IP Perspectives on the Regulation of New Technologies, Edward Elgar Publishing, Cheltenham (UK)/ Northampton (US), 2018, 179. Walter, M. and S. von Lewinski (eds), European Copyright Law, Oxford University Press, Oxford, 2010.

ARTICLE 4: DISTRIBUTION RIGHT 1. 2.

Member States shall provide for authors, in respect of the original of their works or of copies thereof, the exclusive right to authorise or prohibit any form of distribution to the public by sale or otherwise. The distribution right shall not be exhausted within the Community in respect of the original or copies of the work, except where the first sale or other transfer of ownership in the Community of that object is made by the rightholder or with his consent.

SELECTED RECITALS (22) The objective of proper support for the dissemination of culture must not be achieved by sacrificing strict protection of rights or by tolerating illegal forms of distribution of counterfeited or pirated works. (28) Copyright protection under this Directive includes the exclusive right to control distribution of the work incorporated in a tangible article. The first sale in the Community of the original of a work or copies thereof by the rightholder or with his consent exhausts the right to control resale of that object in the Community. This right should not be exhausted in respect of the original or of copies thereof sold by the rightholder or with his consent outside the Community. Rental and lending rights for authors have been established in Directive 92/100/EEC.

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The distribution right provided for in this Directive is without prejudice to the provisions relating to the rental and lending rights contained in Chapter I of that Directive. (29) The question of exhaustion does not arise in the case of services and on-line services in particular. This also applies with regard to a material copy of a work or other subject-matter made by a user of such a service with the consent of the rightholder. Therefore, the same applies to rental and lending of the original and copies of works or other subject-matter which are services by nature. Unlike CD-ROM or CD-I, where the intellectual property is incorporated in a material medium, namely an item of goods, every on-line service is in fact an act which should be subject to authorisation where the copyright or related right so provides.

I. COMMENTARY 1. Introduction 11.42 Article 4 deals with the right of distribution and implements into EU law Article 6 WCT. The right of distribution deals with the dissemination of works in a tangible form (see Recital 28 which provides for the distribution of works ‘incorporated in a tangible article’) in contrast with the communication right, which deals with the dissemination of works in non-tangible formats. According to the Donner case the distribution to the public is ‘characterised by a series of acts going at the very least, from the conclusion of a contract of sale to the performance thereof by delivering to a member of the public’.71 Yet, this distinction becomes blurred in a new technology era where works are distributed via the internet in non-tangible forms substituting for physical distribution. In these cases the right of distribution applies irrespective of the strictly speaking intangible nature of the distributed object.72 11.43 The right of distribution has been harmonised in the past for certain types of works (i.e. computer programs (Art. 4(1)(c) Computer Programs Directive and databases Art. 5(1)(c) Database Directive and for related rights holders Art. 9 Rental and Lending Rights Directive). However, this is the first time that this right is harmonised horizontally to cover all types of works. As it is expressly mentioned in the Information Society Directive all these provisions (of the preceding Directives) remain intact (Art. 1(2) and Recital 28). 11.44 The right of distribution is an exclusive right concerning authors in relation to any type of work, in respect of the original or copies of it, and allows them to authorise or prohibit any form of distribution of this work (original or copies) to the public by sale or otherwise.

2. ‘Authors’ 11.45 The right of distribution refers to authors only with respect to any type of work with the exception of computer programs for which a ‘special’ distribution right applies, which also encompasses the right of rental (Art. 4(c) of the Computer Program Directive in conjunction with Art. 1(2)(a) of the Information Society Directive). The notion of ‘authors’ is not defined in the Directive. Therefore anyone who is considered an author according to the national law of a EU Member State is covered by the Directive. 11.46 Related rights holders are not covered by Article 4. They can, however, benefit from Article 9 of the Rental and Lending Rights Directive.

71 72

Case C-5/11 Criminal proceedings against Titus Alexander Jochen Donner [2012] EUECJ C-5/11. See Case C-128/11 UsedSoft GmbH v Oracle International Corp [2012] EUECJ C-128/11.

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3. ‘Original of their works or of copies thereof’ There was traditionally the view that the right of distribution related to tangible articles incorpor- 11.47 ating copyright works. Apart from Recital 28, which refers to ‘tangible article[s]’, this also seems to be in line with the Agreed Statements concerning Articles 6 and 7 WCT, which provide that ‘“copies” and “original and copies” […] refer exclusively to fixed copies that can be put into circulation as tangible objects’. Yet, in relation to WCT the ‘umbrella solution’ was followed, according to which States Parties could choose how to implement their international obligations under the communication and the distribution right into their national laws without undertaking the obligation to provide for a right of distribution under a separate heading. They could include it as part of any other right to the extent that authors were provided with the substantive elements of it. Although it can be argued that the term ‘copy’ relates to some kind of fixation in tangible form,73 it 11.48 should, however be broadly construed (as a generic term) so as to meet the aims of the right of distribution and prevent the partitioning of the Single Market by means of the non-exhaustion of rights in copies of the work.74 That means that the term ‘copy’ should also encompass digital copies, which are distributed over the internet. This was made clear in the recent case law of the CJEU in relation to software programs (C-128/11 UsedSoft case).75 As the Advocate General in this case observed,76 according to Article 6(1) WCT, in the light of which Articles 3 and 4 of the Information Society Directive, must (so far as possible) be interpreted,77 the existence of a transfer of ownership changes an act of ‘communication to the public’ into an act of ‘distribution’. In paragraph 55 of the UsedSoft case it was mentioned that Article 4(2) of the Computer Program Directive by referring (without further specification) to the ‘sale […] of a copy of a program’, makes no distinction between tangible or intangible copies. Although it must be recalled that the provisions of the Computer Program Directive constitute a lex 11.49 specialis in relation to the Information Society Directive the concepts used in both Directives must in principle have the same meaning.78 The Court also added (para 61) that, from an economic point of view, the sale of a computer program on CD-ROM or DVD and the sale of a program by downloading from the internet are similar. The online transmission method is the functional

73 74 75

76 77 78

See in this respect Recitals 28 and 29 in the Preamble to Dir. 2001/29, Art. 8 WCT and the Agreed Statement concerning Arts 6 and 7 WCT, whose transposition is one of the aims of Dir. 2001/29. See below the discussion on exhaustion of the distribution right. See, however, a German regional Court (Landgericht Bielefeld – case no 4 O 191/11) decision (held on 5.3.2013), which distinguishes between software as lex specialis and other types of works. In fact it provided that the reasoning in UsedSoft could not be applied to other types of works (and in particular downloadable e-books and audiobooks). In other words, the Information Society Directive does not permit the application of the principle of exhaustion to works bearing an intangible form. At the national level, this was also affirmed in another German case: Court of Appeal of Hamm (Oberlandesgericht Hamm), 22 U 60/13, 15.5.2014, and at the EU level in Case C-263/18 Tom Kabinet. Compare also the position in the US. Specifically in Kirtsaeng v John Wiley & Sons No 11-697 (19 March 2013) (the third case in a trilogy of cases of the US Supreme Court within the last 15 years (the other two did not deal with copyright but rather with trademarks: Quality King Distributors Inc v L’anza Research International Inc (9 March 1998 (hairproducts)) and Omega SA v Costco Wholesale Corp (3 September 2008 (watches)) the US Supreme Court ruled that textbooks and other goods made and sold abroad can be re-sold online and in discount stores without violating US copyright law. In a 6–3 opinion, the court overturned a copyright infringement award to publisher John Wiley & Sons against a Thai graduate student Supap Kirtsaeng, who used eBay to resell copies of the publisher’s copyrighted books that his relatives first bought in Asia at cut-price rates. This case recognised international exhaustion for hard copy books. On the contrary, in Capitol Records LLC (EMI) v ReDigi Inc No. 12–00095 (30 March 2013) the Southern District of New York (U.S. District Court) ruled that the ‘first sale’ doctrine does not apply to digital goods. This case was about music digital files. In point 73 of his opinion where he also referred to Case C-456/06 Peek & Cloppenburg [2008] ECR I-2731, para. 30 where this passage refers to Case C-128/11, para. 52. Case C-277/10 Martin Luksan v Petrus van der Let [2012] EUECJ C-277/10, para 59. C-128/11, para 60 where Case C-456/06 Peek & Cloppenburg, para 30 was referred to.

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equivalent of the supply of a material medium. Interpreting Article 4(2) of the Computer Program Directive in the light of the principle of equal treatment confirms that the exhaustion of the distribution right under that provision takes effect after the first sale in the EU of a copy of a computer program by the copyright holder or with his consent, regardless of whether the sale relates to a tangible or an intangible copy of the program. 11.50 It can be submitted from the above that Article 4 should be construed in such a way so as to encompass copies both in tangible and intangible form. Some examples are hard copy books as well as books available online for downloading, CDs and DVDs as well as music, software or films available for downloading.79 In this light it should also be submitted that it is irrelevant for this provision whether the original is in tangible or intangible form. In order for the distribution right to come into play what seems to be important is whether a transfer of ownership has occurred or not. If a transfer of ownership has not occurred then it is the communication right which is at stake (and thus a service provided) rather than the right of distribution. Even if a copy (tangible or intangible) of a work is offered for sale, the right of distribution does not apply unless this copy is put in circulation (i.e. actually put on the market).80 Again what is decisive here is that a transfer of ownership takes place to a member of the public.81 11.51 The notion of ‘public’ is not defined in the Directive. For the notion of ‘public’ see the discussion under Article 3. In case a copy of the work (or the original) is not sold or a transfer of ownership has not taken place to a member of the public but rather to a relative, friend or acquaintance then the right of distribution does not apply. 11.52 It should also be mentioned that it is irrelevant from a legal point of view if it is the author himself or a third party that has produced the copies of the work as long as these copies have been produced and sold (or otherwise distributed) with the consent of their right holder.

4. ‘By sale or otherwise’ 11.53 In order for the right of distribution to apply a sale or other transfer of ownership should take place. Some examples in this respect are donation, exchange, barter or endowment. This is an issue to be assessed on the basis of the contract, which underpins the transaction at issue. The contract itself is interpreted according to the national law that applies. Rental and lending rights are not covered by Article 4 since they do not relate to any transfer of ownership. These rights are regulated in Article 2 of the Rental and Lending Rights Directive, whose provisions remain intact. If that were the case express reference would have been made in the provision as the case was with Article 4(c) of the Computer Program Directive (‘any form of distribution to the public, including the rental, of the original computer program or of copies thereof’).

79 80

81

See above Art. 3, section 7. Neither import nor offering for sale within the EU triggers exhaustion if no sale has taken place. See C-16/03, Peak Holding AB v Axolin-Elinor AB [2004] ECR I-11313; Case C-324/08 Makro Zelfbedieningsgroothandel and Others [2009] ECR I-10019; Case C-127/09 Coty Prestige Lancaster Group [2010] ECR I-4965; Case C-324/09 L’Oréal SA and Others v eBay International AG and Others [2011] ECR I-6011. There is also the view that the offer for sale or any other disposal of the original or copies of the work is covered by the right of distribution. See on this the views of Walter and von Lewinski, 996 and A. Ohly in E. Derclaye (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2008, 212 and 220 et seq.; Walter and von Lewinski, 996–7 also argue that importation should be regarded as an act of distribution since the importer is a member of the public and the copyright material is transferred to him in conveying the legal and actual power of disposal and regularly in transferring ownership. C-128/11, para 52. See also Bechtold, 364.

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5. Exhaustion of rights The principle: The principle of exhaustion applies in relation to the distribution right. That means 11.54 that if an author/right holder sells (or otherwise transfers ownership) to members of the public the original or copies of his work in the EU (or the EEA),82 himself or with his consent, he cannot prevent third parties from reselling or further transferring ownership to that original or copy of the work within the EU or the EEA. This principle strikes a balance between the rights of the authors and the free movement of goods (Arts 34–36 TFEU). This is a EU-wide exhaustion (Community exhaustion), which applies only to the extent that an article is sold within the EU (or the EEA). If it is sold outside the EU the right of distribution in the EU is not exhausted.83 Although Community exhaustion is stipulated expressly for the whole of the EU in relation to all 11.55 types of works (in a horizontal manner) for the first time,84 this was not considered necessary because it was unequivocally provided in the jurisprudence of the CJEU even in the first cases dealing with the free movement of goods and the exhaustion of the intellectual property rights.85 ‘Sale or transfer of ownership’: The right of distribution86 is exhausted when the first sale (or transfer 11.56 of ownership)87 of the work is made by the right holder himself or with his consent and it always relates to the particular original or copy of the work rather than generally to the work incorporated in it. The rule of exhaustion of the distribution right does not apply in cases where a reproduction of a protected work has undergone an alteration of its medium, such as the transfer of that reproduction from a paper poster onto a canvas and is placed on the market again in its new form, as affirmed in Case C-419/13 Art & Allposters; in addition, the exhaustion rule does not cover copying a computer program and offering it for sale, as per Case C-166/15 Ranks.88 The distribution right presupposes a transfer of ownership in all cases.89 That means that acts such as rental and lending

82 83

84 85 86 87

88

See Annex 17 no. 9(e) and Protocol 28 Art. 2 to the EEA Agreement. The EEA countries are Norway, Iceland and Liechtenstein. For further details see I. Stamatoudi, Community Competition Law and Intellectual Property. Abuse of Dominant Position, Nomiki Vivliothiki, Athens, 2006, 59 et seq. (in Greek). See also I. Stamatoudi, ‘From drugs to spirits and from boxes to publicity. Decided and undecided issues in relation to trade marks and copyright exhaustion’, (1999) Intellectual Property Quarterly, 1, 95; I. Stamatoudi, ‘International Exhaustion in the European Union in the Light of Zino Davidoff: Contract v Trade Mark Law?’ (2000) IIC, 2, 123, with P. Torremans; I. Stamatoudi, ‘Exhaustion of rights in relation to trademarks’ (2003) Private Law Chronicles, 565 (in Greek). Before the enactment of the Information Society Directive, this was expressly provided solely for computer programs, databases (both for copyright and the sui generis right) and the four related rights in the corresponding Directives. Stamatoudi, 2006, 59 et seq. It is only the right of distribution that is exhausted. Earlier Directives followed a narrower approach since they did not refer to ‘other transfer of ownership’ (Art. 4(2) of the Computer Programs Directive; Arts 5(c) and 7(2)(b) of the Database Directive; and Art. 9(2) of the Rental and Lending Rights Directive). It can be submitted though that they should be interpreted in the same manner. See Case C-419/13 Art & Allposters International BV v Stichting Pictoright [2015] EUECJ C-419/13, where the CJEU was asked whether: article 4 of the Copyright Directive governs the answer to the question whether the distribution right of the copyright holder may be exercised with regard to the reproduction of a copyright-protected work which has been sold and delivered within the European Economic Area by or with the consent of the rightholder in the case where that reproduction had subsequently undergone an alteration in respect of its form;

89

also see Case C-166/15 Aleksandrs Ranks and Jurijs Vasiļevicˇs v Finanšu un ekonomisko noziegumu izmeklēšanas prokoratūra and Microsoft Corp [2016] EUECJ C-166/15. See e.g. Case C-98/13 Martin Blomqvist v Rolex SA, Manufacture des Montres Rolex SA [2014] ETMR 25, para. 28, where the CJEU held: Distribution to the public is characterised by a series of acts going, at the very least, from the conclusion of a contract of sale to the performance thereof by delivery to a member of the public. A trader in such circumstances bears responsibility for any act carried out by him or on his behalf giving rise to a ‘distribution to the public’ in a Member State where the goods distributed are protected by copyright.

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are not included.90 This is also in line with the interpretation of the distribution right in the WCT and WPPT.91 If the transfer of ownership is limited in time it is disputed whether exhaustion applies.92 11.57 Exhaustion in relation to goods rather than services: Exhaustion applies in relation to goods rather than services. This does not preclude instances where tangible goods are sold/distributed online as well as instances where intangible goods are distributed online by means of downloads. It does not apply to the communication right or the making available right as well as to the rental and lending rights. 11.58 The inclusion of both tangible and intangible copies is dictated by the objective of the principle of exhaustion, which is to avoid the partitioning of markets and to limit restrictions of the distribution of those works to what is necessary to safeguard the specific subject matter of the intellectual property concerned.93 11.59 Consent: In order for the principle of exhaustion to apply the first sale (or transfer of ownership) of the object should be made by the right holder or with his consent. That means that third parties such as licensees, distributors and so on may also sell the product in the EU (or EEA) after they have been authorised to do so by the right holder on the basis, for example, of an agreement, licence or contract. 11.60 The fact that different right holders for the same article exist in different EU Member States does not carry any legal weight as long as this article has been put on the market in a Member State with the consent of the right holder of that Member State. Who the right holder is though is a matter to be determined by the law of the State where exhaustion is claimed.

90

91

S. Bechtold, 365. Contra: Walter and von Lewinski, 993–4. The opposite view is followed later on in the same publication by M. Walter and L. Riede in M. Walter and S. von Lewinski (eds), European Copyright Law, Oxford University Press, Oxford, 2010, 997 et seq. See also CJEU’s case law that distinguishes between rental and cases of transfer of ownership: Case C-158/86 Warner Brothers Inc and Metronome Video ApS v Erik Viuff Christiansen [1988] ECR I-02605; Case C-200/96 Metronome Musik [1998] ECR I-1953 and Case C-61/97 FDV [1998] ECR I-5171. See Case C-456/06, Peek & Cloppenburg KG v Cassina SpA [2014] EUECJ C-325/13, where it was provided that: [t]he concept of distribution ‘by sale or otherwise’ for the purpose of Article 4(1) of Directive 2001/29 must be interpreted in the light of the definitions given in the World Intellectual Property Organisation (WIPO) Copyright Treaty and the WIPO Performances and Phonograms Treaty, that directive being intended to implement at Community level the Community’s obligations under those Treaties. Those Treaties link the concept of distribution exclusively to that of transfer of ownership.

92

According to Case C-128/11 (UsedSoft GmbH v Oracle International Corp [2012] EUECJ C-128/11, para. 47: It makes no difference, in a situation such as that at issue in the main proceedings, whether the copy of the computer program was made available to the customer by the rightholder concerned by means of a download from the rightholder’s website or by means of a material medium, such as a CD-ROM or DVD. Even if, in the latter case too, the rightholder formally separates the customer’s right to use the copy of the program supplied from the operation of transferring the copy of the program to the customer on a material medium, the operation of downloading from that medium a copy of the computer program and that of concluding a licence agreement remain inseparable from the point of view of the acquirer […]. Since an acquirer who downloads a copy of the program concerned by means of a material medium such as a CD-ROM or DVD and concludes a licence agreement for that copy receives the right to use the copy for an unlimited period in return for payment of a fee, it must be considered that those two operations likewise involve, in the case of the making available of a copy of the computer program concerned by means of a material medium such as a CD-ROM or DVD, the transfer of the right of ownership of that copy.

93

See Case C-128/11 UsedSoft GmbH v Oracle International Corp [2012] EUECJ C-128/11, paras 62–3; Case C-200/96 Metronome Musik, para. 14; Case C-61/97 FDV [1998] ECR I-1953, para. 13; and Case C-403/08 Football Association Premier League and Others [2011] ECR I-9083, paras 105–6; for a discussion on the distinction between goods and services in the context of copyright exhaustion see S. Karapapa, ‘Reconstructing copyright exhaustion in the online world’ (2014) Intellectual Property Quarterly, 4, 304–22.

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The consent required should always be given by the person having the exclusive right of distribution 11.61 in the particular article or articles that are put on the market. If more than one person has this right then consent from all persons is required. The consent has to relate to the first sale of the particular product in the EU. If the licence is 11.62 granted for a particular Member State that means that a first sale in any other Member State will fall outside the scope of the licence and will therefore not occur with the consent of the right holder. That means that if a licensee is licensed to sell the products in Greece, but he sells them in France, then exhaustion does not apply, as the sale did not occur with the consent of the right holder. Exhaustion also does not apply in cases where a product is marketed by a third party in an area where there is no copyright protection for that particular product. The right holder’s consent cannot be assumed in this case since no protection is available.94 Consent is not defined in the Directive. However, it should be construed in an autonomous and 11.63 uniform manner in the EU95 for the sake of harmonisation in conjunction also with the ‘consent’ provided under the Trademark Directive.96 Consent can either be expressed (in writing) or be inferred from the facts or circumstances of the case prior to, simultaneous with or subsequent to, the placing of the goods on the market.97 There are differing views as to who bears the burden of proof that an article has been sold with the right holder’s consent within the EU. It seems however only to be fair and practical (and also consistent with Article 8 of the Enforcement Directive) that for the party alleging that the article has been sold with the right holder’s consent within the EU it suffices for it to prove that the article has indeed been sold for the first time within the EU. It is up to the right holder to prove that this sale has either not occurred or did not occur with his consent.98 Constraints on consent (e.g. geographical, time and mode of distribution): Right holders may place 11.64 certain limits on their consent as long as these limits are not geographical concerning the area of the EU and EEA. Such limits would impinge on the free movement of goods and therefore on Articles 34–36 TFEU and potentially on competition rules, too.99 The right holder may place constraints on his consent relating to time or modes of distribution.100 11.65 He may, for example, only allow the sale of paperback books or of CDs packed together with a newspaper or magazine. Time constraints seem to be meaningless for articles that have been

94 95 96

97 98

See, e.g., Case C-456/06 Peek & Cloppenburg KG v Cassina SpA, in relation to the rental right; C-341/87 EMI Electrola v Patricia et al. [1989] ECR 79; C-144/81 Keurkoop v Nancy Kean Gifts [1982] ECR 2853. See also Art. 3, section 5. See also Joined cases C-414/99; C-415/99; C-416/99; Zino Davidoff SA v A & G Imports Ltd and Levi Strauss & Co and Others v Tesco Stores Ltd and Others [2003] ECR I-389 in relation to Dir. 89/104/EEC of 21 December 1988 to approximate the laws of the Member States relating to trade marks, OJ L 40/1, 11.2.1989. Joined cases C-414/99 to C-416/99, para. 46. Differing approaches have been followed in Joined cases C-414/99; C-415/99; C-416/99 Zino Davidoff SA v A & G Imports Ltd and Levi Strauss & Co and Others v Tesco Stores Ltd and Others [2003] ECR I-389 and in C-244/00 Van Doren + Q. GmbH v Lifestyle sports + sportswear Handelsgesellschaft mbH and Michael Orth. [2003] ECR I-3051. According to the latter case: a trader against whom proceedings are brought on the basis of a trade mark for marketing original goods, and who claims that the trade-mark right has been exhausted within the meaning of Article 7 of Directive 89/104/EEC, has to plead and, if necessary, prove that the goods marketed by him have already been put on the market in the European Economic Area for the first time by the trade-mark owner himself or with his consent […].

99

100

Case 78/70 Deutsche Grammophon GmbH v Metro-SB-Grossmarkte GmbH & Co KG [1971] ECR 487. Joined Cases C-55 and C-57/80 Musik-Vertrieb Membran GmbH v GEMA, [1981] ECR 147. See also C-40/70 Sirena [1971] ECR 69; Joined Cases 56 and 58–64, Établissements Consten S.à.R.L. and Grundig-Verkaufs-GmbH v Commission of the European Economic Community [1966] ECR 429; Case 170/83 Hydrotherm Gerätebau GmbH v Compact del Dott. Ing. Mario Andreoli 1984 ECR 2999 and C-58/80 Dansk Supermarked A/S v A/S Imerco, [1981] ECR 181. Bechtold, 366.

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lawfully sold before time limitations expire. The rights of distribution cannot revive for those articles. It is disputed whether exceeding the limits of the licence is considered to be a breach of contract or a copyright infringement. This will very much depend on the applicable national law since the Directive is silent on these issues.101 11.66 In any case consent relates to particular copies only and it is in relation to those copies only that the right of distribution is exhausted.102 11.67 International exhaustion: According to the Information Society Directive international exhaustion does not apply. This was expressly provided both by the Court of Justice of the European Union (Silhouette case)103 as well as by the EFTA Court (L’Oréal case).104 This means that also EU Member States are barred from applying international exhaustion.105

NOTES 1. Related instruments The WIPO Copyright Treaty (WCT) (1996). The WIPO Performances and Phonograms Treaty (WPPT) (1996). Directive 2009/140/EC of the European Parliament and of the Council of 25 November 2009 amending Directives 2002/21/EC on a common regulatory framework for electronic communications networks and services, 2002/ 19/EC on access to, and interconnection of, electronic communications networks and associated facilities, and 2002/20/EC on the authorization of electronic communications networks and services, (2009) OJ L 337/37. Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights, OJ L 157/45, 30.4.2004. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market, OJ L 178/1, 17.07.2000. Communication from the Commission. Copyright in the Knowledge Economy, 19.10.2009, COM (2009) 532 final. Green Paper on Copyright in the Knowledge Economy, 16.7.2008, COM (2008) 466/3. Commission Staff Working Document Report to the Council, the European Parliament and the Economic and Social Committee on the application of Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society SEC (2007) 1556.

2a. CJEU case law Aleksandrs Ranks and Jurijs Vasiļevicˇs v Finanšu un ekonomisko noziegumu izmeklēšanas prokoratūra and Microsoft Corp (Case C-166/15) [2016] EUECJ C-166/15. Art & Allposters International BV v Stichting Pictoright (Case C-419/13) [2015] EUECJ C-419/13. Coty Prestige Lancaster Group (Case C-127/09) [2010] ECR I-4965. Criminal proceedings against Titus Alexander Jochen Donner (Case C-5/11) [2012] EUECJ C-5/11. Dansk Supermarked A/S v A/S Imerco (C-58/80) [1981] ECR 191. Deutsche Grammophon GmbH v Metro-SB-Grossmarkte GmbH & Co KG (Case 78/70) [1971] ECR 487. EMI Electrola v Patricia et al. (C-341/87) [1989] ECR 79.

101 102 103 104

105

For Germany see, e.g., OEM-Version, Bundesgerichtshof (BGH) (Federal Supreme Court) 6 July 2000, Case I ZR 244/97 (2001) GRUR 153. C-173/98 Sebago Inc and Ancienne Maison Dubois & Fils SA v GB Unic SA [1999] ECR I-4103 and Case C-479/04 Laserdisken ApS v Kulturministeriet [2006] ECR I-8089. Case C-355/96 Silhouette International Gmbh and Co KG v Hartlauer Handelsgesellschaft mbH [1998] ECR I-676. The European Free Trade Association (EFTA) Court in the Joined Cases E-9/07 and E-10/07 L’Oréal Norge AS v Per Aarskog AS and L’Oréal SA v Smart Club AS [2008] ETMR 60, which overturned Case E-2/97 Mag Instruments (1997 EFTA Court Report, 127). See Bechtold, 366 who refers to the Explanatory Memorandum to the Directive and to Case 270/80 Polydor Ltd and RSO Records Inc v Harlequin Record Shops Ltd and Simons Records Ltd [1982] ECR 329 where it is provided that international exhaustion also applies to countries that have signed a free trade agreement with the EU.

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ARTICLE 4: DISTRIBUTION RIGHT Établissements Consten S.à.R.L. and Grundig-Verkaufs-GmbH v Commission of the European Economic Community (Joined Cases 56 and 58–64) [1966] ECR 429. FDV (C-61/97) [1998] ECR I-5171. Football Dataco Ltd and Others v Sportradar GmbH et Sportradar AG (Case C-173/11) [2012] EUECJ C-173/11. Hydrotherm Gerätebau GmbH v Compact del Dott. Ing. Mario Andreoli (Case 170/83) [1984] ECR 2999. Keurkoop v Nancy Kean Gifts (C-144/81) [1982] ECR 2853. Laserdisken ApS v Kulturministeriet (Case C-479/04) [2006] ECR I-08089. L’Oréal SA and Others v eBay International AG and Others (C-324/09) [2011] ECR I-6011. Martin Luksan v Petrus van der Let (C-277/10) [2012] EUECJ C-277/10. Metronome Musik (C-200/96) [1998] ECR I-1953. Musik-Vertrieb Membran GmbH GEMA (Joined Cases C-55 and C-57/800 [1981] ECR 147. Peak Holding AB v Axolin-Elinor AB (C-16/03) [2004] ECR I-11313. Peek & Cloppenburg (C-456/06) [2008] ECR I-2731. Polydor Ltd and RSO Records Inc v Harlequin Record Shops Ltd and Simons Records Ltd (Case 270/80) [1982] ECR 329. Silhouette International Gmbh and Co KG v Hartlauer Handelsgesellschaft mbH (Case C-355/96) [1998] ECR I-676. Sirena (C-40/70) [1971] ECR 69. UsedSoft GmbH v Oracle International Corp (Case C-128/11) [2012] EUECJ C-128/11. Van Doren + Q. GmbH v Lifestyle sports + sportswear Handelsgesellschaft mbH and Michael Orth. (C-244/00) [2003] ECR I-3051. Warner Brothers Inc and Metronome Video ApS v Erik Viuff Christiansen (Case C-158/86) [1988] ECR I-02605. Zino Davidoff SA v A & G Imports Ltd and Levi Strauss & Co and Others v Tesco Stores Ltd and Others (Joined Cases C-414/99, C-415/99 C-416/99) [2003] ECR I-389.

2b. ECtHR Neij and Sunde Kolmisoppi v Sweden case (application no. 40397/12) – 19.2.2013.

3. Bibliography Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2008. Dreier, T. and P.B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law International, Alphen aan den Rijn, 2006. Ficsor, M. The Law of Copyright and the Internet. The 1996 WIPO Treaties, Their Interpretation and Implementation, Oxford University Press, Oxford, 2002. Karapapa, S. ‘Reconstructing copyright exhaustion in the online world’ (2014) Intellectual Property 4, 304–22. Reinbothe, J. and S. von Lewinski, The WIPO Treaties 1996. Comments and Legal Analysis, Butterworths, LexisNexis, London, 2002. Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law & Business, Alphen aan den Rijn, 2010. Stamatoudi, I. ‘ACTA, internet service providers and the acquis communautaire ’, in Rosén, J. (ed.), Intellectual Property at the Crossroads of Trade, ATRIP Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2012. Stamatoudi, I. ‘Data protection, secrecy of communications and copyright protection. Conflicts and convergences. The example of Promusicae v. Telefonica ’, in Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Information Law Series (Hugenholtz, B. (general ed.)), Kluwer Law International, Alphen aan den Rijn, 2010. Stamatoudi, I. ‘The role of internet service providers. Ethics, reality and the law: The example of Promusicae v. Telefonica ’, 8th International Conference, Computer Ethics: Philosophical Enquiry, Ionio University, Corfu, 26–28 June 2009, Nomiki Vivliothiki, Athens, 2009. Stamatoudi, I. Community Competition Law and Intellectual Property. Abuse of Dominant Position, Nomiki Vivliothiki, Athens, 2006 (in Greek). Stamatoudi, I. ‘From drugs to spirits and from boxes to publicity. Decided and undecided issues in relation to trade marks and copyright exhaustion’, (1999) Intellectual Property Quarterly, 1, 95. Stamatoudi, I. with Paul Torremans, ‘International exhaustion in the European Union in the light of Zino Davidoff: Contract v Trade Mark Law?’, (2000) IIC 2, 123. Stamatoudi, I. ‘Exhaustion of rights in relation to trademarks’ (2003) Private Law Chronicles 565 (in Greek). Stamatoudi, I. ‘Article 2’ in Kotsiris, L. and I. Stamatoudi, Comments on Greek Copyright Law, Sakkoulas Publications, Athens, Thessaloniki, 2009 (2nd ed. 2012) (in Greek).

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Chapter 11 THE INFORMATION SOCIETY DIRECTIVE Stamatoudi, I. and G. Koumantos, ‘Greek Copyright Law’ in Geller, P.E. (ed.) International Copyright Law and Practice, Matthew Bender, USA, 2014. Walter, M. and S. von Lewinski (eds), European Copyright Law, Oxford University Press, Oxford, 2010.

ARTICLE 5: EXCEPTIONS AND LIMITATIONS 1.

2.

3.

Temporary acts of reproduction referred to in Article 2, which are transient or incidental [and] an integral and essential part of a technological process and whose sole purpose is to enable: (a) a transmission in a network between third parties by an intermediary, or (b) a lawful use of a work or other subject matter to be made, and which have no independent economic significance, shall be exempted from the reproduction right provided for in Article 2. Member States may provide for exceptions or limitations to the reproduction right provided for in Article 2 in the following cases: (a) in respect of reproductions on paper or any similar medium, effected by the use of any kind of photographic technique or by some other process having similar effects, with the exception of sheet music, provided that the right holders receive fair compensation; (b) in respect of reproductions on any medium made by a natural person for private use and for ends that are neither directly nor indirectly commercial, on condition that the right holders receive fair compensation which takes account of the application or non-application of technological measures referred to in Article 6 to the work or subject-matter concerned; (c) in respect of specific acts of reproduction made by publicly accessible libraries, educational establishments or museums, or by archives, which are not for direct or indirect economic or commercial advantage, without prejudice to the exceptions and limitations provided for in Directive (EU) 2019/790 of the European Parliament and of the Council; (d) in respect of ephemeral recordings of works made by broadcasting organisations by means of their own facilities and for their own broadcasts; the preservation of these recordings in official archives may, on the grounds of their exceptional documentary character, be permitted; (e) in respect of reproductions of broadcasts made by social institutions pursuing noncommercial purposes, such as hospitals or prisons, on condition that the right holders receive fair compensation. Member States may provide for exceptions or limitations to the rights provided for in Articles 2 and 3 in the following cases: (a) use for the sole purpose of illustration for teaching or scientific research, as long as the source, including the author’s name, is indicated, unless this turns out to be impossible and to the extent justified by the non-commercial purpose to be achieved; (b) uses, for the benefit of people with a disability, which are directly related to the disability and of a non-commercial nature, to the extent required by the specific disability, without prejudice to the obligations of Member States under Directive (EU) 2017/1564 of the European Parliament and of the Council; (c) reproduction by the press, communication to the public or making available of published articles on current economic, political or religious topics or of broadcast works or other subject-matter of the same character, in cases where such use is not expressly reserved, and as long as the source, including the author’s name, is indicated, or use of works or other subject-matter in connection with the reporting of

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4.

5.

6.

current events, to the extent justified by the informatory purpose and as long as the source, including the author’s name, is indicated, unless this turns out to be impossible; (d) quotations for purposes such as criticism or review, provided that they relate to a work or other subject-matter which has already been lawfully made available to the public, that, unless this turns out to be impossible, the source, including the author’s name, is indicated, and that their use is in accordance with fair practice, and to the extent required by the specific purpose; (e) use for the purposes of public security or to ensure the proper performance or reporting of administrative, parliamentary or judicial proceedings; (f) use of political speeches as well as extracts of public lectures or similar works or subject-matter to the extent justified by the informatory purpose and provided that the source, including the author’s name, is indicated, except where this turns out to be impossible; (g) use during religious celebrations or official celebrations organised by a public authority; (h) use of works, such as works of architecture or sculpture, made to be located permanently in public places; (i) incidental inclusion of a work or other subject-matter in other material; (j) use for the purpose of advertising the public exhibition or sale of artistic works, to the extent necessary to promote the event, excluding any other commercial use; (k) use for the purpose of caricature, parody or pastiche; (l) use in connection with the demonstration or repair of equipment; (m) use of an artistic work in the form of a building or a drawing or plan of a building for the purposes of reconstructing the building; (n) use by communication or making available, for the purpose of research or private study, to individual members of the public by dedicated terminals on the premises of establishments referred to in paragraph 2(c) of works and other subject-matter not subject to purchase or licensing terms which are contained in their collections; (o) use in certain other cases of minor importance where exceptions or limitations already exist under national law, provided that they only concern analogue uses and do not affect the free circulation of goods and services within the Community, without prejudice to the other exceptions and limitations contained in this Article. Where the Member States may provide for an exception or limitation to the right of reproduction pursuant to paragraphs 2 and 3, they may provide similarly for an exception or limitation to the right of distribution as referred to in Article 4 to the extent justified by the purpose of the authorised act of reproduction. The exceptions and limitations provided for in paragraphs 1, 2, 3 and 4 shall only be applied in certain special cases which do not conflict with a normal exploitation of the work or other subject-matter and do not unreasonably prejudice the legitimate interests of the right holder. Notwithstanding the legal protection provided for in paragraph 1, in the absence of voluntary measures taken by rightholders, including agreements between rightholders and other parties concerned, Member States shall take appropriate measures to ensure that rightholders make available to the beneficiary of an exception or limitation provided for in national law in accordance with Article 5(2)(a), (2)(c), (2)(d), (2)(e), (3)(a), (3)(b) or (3)(e) the means of benefiting from that exception or limitation, to the extent necessary to benefit from that exception or limitation and where that beneficiary has legal access to the protected work or subject-matter concerned. A Member State may also take such measures in respect of a beneficiary of an exception or limitation provided for in accordance with Article 5(2)(b), unless reproduction for private use has already been made possible by rightholders to the extent necessary to

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benefit from the exception or limitation concerned and in accordance with the provisions of Article 5(2)(b) and (5), without preventing rightholders from adopting adequate measures regarding the number of reproductions in accordance with these provisions. The technological measures applied voluntarily by rightholders, including those applied in implementation of voluntary agreements, and technological measures applied in implementation of the measures taken by Member States, shall enjoy the legal protection provided for in paragraph 1. The provisions of the first and second subparagraphs shall not apply to works or other subject-matter made available to the public on agreed contractual terms in such a way that members of the public may access them from a place and at a time individually chosen by them. When this Article is applied in the context of Directives 92/100/EEC and 96/9/EC, this paragraph shall apply mutatis mutandis.

I. COMMENTARY 11.68 The economic rights set out in Articles 2–4 of the Directive on copyright and related rights reserve the acts described therein to the author or the holder of a neighbouring right only. Yet not all uses of works protected by copyright amount to infringement of an exclusive right. First, the right holder may of course authorise certain uses of his work, e.g. by contract. Second, certain uses are left outside the sphere of control of the right holder, if they are covered by an ‘exception or limitation’106 to copyright law. 11.69 Before 22 December 2002, the date on which Member States should officially have implemented the provisions of the Directive into their national laws,107 the regimes of exceptions and limitations to copyright law diverged largely. The rapid rise of digital markets and the new possibilities to exploit copyright works in the digital environment called, however, for a more transparent and harmonised legal framework across European borders. While exclusive rights aim at ensuring the economic interests of the creator, limitations to the rights also help ensure freedom to create.108 Limitations can therefore be considered as a stimulus to creativity on the same level as exclusive rights; they have, indeed, often been qualified as ‘rights’ granted to users and future creators.109 Of course, Recital 4 of the Directive sets out that a ‘harmonised legal framework on copyright and related rights, through increased legal certainty and while providing for a high level of protection of intellectual property, will foster substantial investment in creativity and innovation […]’. Recital 31 adds, however, that a ‘fair balance of rights and interests […] between the different categories of rightholders and users of protected subject-matter must be safeguarded’. The recital goes on to say that ‘existing differences in the exceptions and limitations to certain restricted acts have direct negative effects on the functioning of the internal market of copyright and related rights. […] The

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On the terminology and its consequences, see infra. Art. 10(1) of the Directive. See, for instance, C. Geiger, (2010a) ‘Promoting creativity through copyright limitations, reflections on the concept of exclusivity in copyright law’, (2010) Vanderbilt Journal of Entertainment & Technology Law, 12, 515, 525. See, with further references C. Geiger, (2004a) ‘De la nature juridique des limites au droit d’auteur’, (2004), Propriétés intellectuelles, 13, 882–91, 882; Geiger 2010a; Christophe Geiger, (2013a) ‘Effectivité et flexibilité: deux impératifs de l’adaptation du droit des “exceptions”‘ (2013), RLDI, Special issue No 94, 41. See in this sense the decisions of the Supreme Court of Canada, 4 March 2004, CCH Canadienne Limitée v Barreau du Haut-Canada (2004 CSC 13) and more recently the decision of 12 July 2012, Société canadienne des auteurs, compositeurs et éditeurs de musique v Bell Canada, 2012 CSC 36, 2 RCS 3326; Alberta (Education) v Canadian Copyright Licensing Agency (Access Copyright), 2012 CSC 37, 2 RCS 345. The Washington Declaration on Intellectual Property and the Public Interest refers to exceptions and limitations as ‘positive enabling doctrines that function to ensure that intellectual property law fulfills its ultimate purpose of promoting essential aspects of the public interest’ (3), available at http://infojustice.org/washingtondeclaration-html (last accessed on 17 December 2012).

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degree of their harmonisation should be based on their impact on the smooth functioning of the internal market’.110 Therefore, even if the idea of achieving a fair balance of interest is explicitly stated, the focus of the EU institutions in the domain of exceptions and limitations appears to have been the proper functioning of the internal market, and not the promotion of creativity. Moreover, the critique generally brought forward is that the potential of limitations has been underestimated, and that the EU concentrated too much on strengthening exclusive rights.111

II. METHOD OF HARMONISATION OF ARTICLE 5 1. An exhaustive list of limitations A. Exceptions or limitations? Article 5 of the Directive is entitled ‘Exceptions and limitations’, and its text refers to ‘exceptions or 11.70 limitations’ and to exempted acts. These terms, which appear to be put on the same level, are not defined further. They do, however, refer to different legal concepts: an exception describes the derogation from a rule or a principle, whereas a limitation indicates that the exclusive right does not extend to a particular use of the work.112 Such differing concepts would normally impact the understanding and interpretation of the respective provisions. Yet, it has been argued that the European institutions in their legislative function focus on results, and do not usually adopt a dogmatic attitude.113 In accordance with the legal nature of a Directive, the choice of form and methods of achieving the result aimed at by the Directive is left up to the Member States (Art. 288 TFEU).114 In our view, the term ‘limitation’ is, nonetheless, more accurate:115 what should be

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See also in this sense the reflection paper of the European Commission adopted on 22 October 2009, ‘Creative content in a European digital single market: challenges for the future, a reflection document of DG INFSO and DG MARKT’, 15: Community rules on copyright have harmonised the scope and tenor of the exclusive rights without, however, providing clear boundaries for these rights by means of uniform exceptions. This is indeed a state of affairs that should not persist in a truly integrated market. The unclear contours of strong ‘exclusive rights’ are neither beneficial for the internal market in knowledge products nor for the development in internet services. Further harmonisation of copyright laws in the EU, in particular relating to the different and optional limitations and exceptions, would create more certainty for consumers about what they can and cannot do with the content they legally acquire.

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See, with further references, C. Geiger, (2010c), ‘The future of copyright in Europe: striking a fair balance between protection and access to information/L’avenir du droit d’auteur en Europe: Vers un juste équilibre entre protection et accès à l’information’. However, in its Green Paper on ‘Copyright in the Knowledge Economy’, Brussels, COM (2008) 466/3, the Commission seems to admit that it is the exceptions and limitations that ensure the dissemination of knowledge within copyright law and which are the key to the balance to be sought by Community legislation. For a comment, see Geiger et al., ‘What limitations to copyright in the information society? A comment on the European Commission’s Green Paper “Copyright in the Knowledge Economy”,’ (2009) IIC 412. Unfortunately, no initiative of reform has been taken since. See R. Hilty and C. Geiger (eds), Impulse für eine europäische Harmonisierung des Urheberrechts, Urheberrecht im deutsch-französischen Dialog/ Perspectives d’harmonisation du droit d’auteur en Europe, Berlin/ Heidelberg/ New York and Paris, Springer/ Litec LexisNexis, 2007, 363; J.N. Ullrich, ‘Clash of copyrights – Optionale Schranke und zwingender finanzieller Ausgleich im Fall der Privatkopie nach Art. 5 Abs. 2 lit. b) Richtlinie 2001/29/EG und Dreistufentest’ (2009) GRUR Int. 283, 285. See Hilty and Geiger, 609. The open language of Art. 5 should also allow Member States to implement the text in accordance with their own legal tradition. Moreover, the term ‘limitation’ would be more coherent with the general structure of copyright law: the exclusive right is limited in time, since there is a term to its protection prescribed by law; the right to distribution is equally limited by exhaustion within the EU under certain conditions (Art. 4(2) of the Directive). Access to protection is limited to certain categories of original works, and to authors fulfilling a number of legal conditions.

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expressed is the need to determine the exact scope of the author’s right, i.e. to delimit the right, and not the idea that unauthorised uses shall be considered as the exception to the broad exclusive right.116

B. An open or closed list of limitations? 11.71 As Burrell and Coleman sum up, there are, broadly speaking, two ways of construing exceptions or limitations to copyright law: ‘The first approach is to provide a small number of generally worded exceptions. The second approach is to provide a larger number of much more specific exceptions, encompassing carefully defined activities.’117 Whereas this broad classification is not a rigid one, the US fair use approach is often named as a prime example for a generally worded exception. In Europe, longer lists of specific exceptions prevail. This has been said to include the UK copyright system, since the generally worded fair dealing contains a number of limitations itself, e.g. as to the purposes for which it may be invoked.118 In addition to the copyright exceptions and limitations listed in Article 5, there are a number of copyright exceptions and limitations listed in the Digital Single Market Directive (Directive 2019/790). 11.72 Recital 32 of the Directive apparently confirms the choice of the EU legislature to adopt a ‘closedlist approach, stating that the ‘Directive provides for an exhaustive enumeration of exceptions and limitations to the reproduction right and the right of communication to the public’. However, Article 5(3)(o) of the Directive, the so-called ‘grandfather clause’, allows uses ‘in certain other cases of minor importance where exceptions or limitations already exist under national law, provided that they only concern analogue uses and do not affect the free circulation of goods and services within the Community’. Thus, if Member States are not allowed to introduce new exceptions or limitations other than those listed in Article 5, the ‘grandfather clause’ allows some room for the diversity of the Member States’ regimes of limitations.119 The choice of an exhaustive list, which reflects the civil law rather than the common law tradition, has often been criticised. Flexibility is thought to be lacking in two respects: for the accommodation of the specificities of national copyright laws on the one hand; and for adaptation to the extremely rapid development of the, in

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See C. Geiger, (2004b), Droit d’auteur et droit du public à l’information, approche de droit comparé, Paris, Litec, 194; ‘Les exceptions au droit d’auteur en France (analyse critique et prospective)’ in Hilty and Geiger, 349 et seq.; P.B. Hugenholtz, (1997), ‘Fierce Creatures, Copyright Exemptions: Towards Extinction?’ 13 et seq.; Hugenholtz, P.B. ‘Adapting copyright to the information superhighway’, in P.B. Hugenholtz (ed.), The Future of Copyright in a Digital Environment, Kluwer Law International, The Hague, 1996, 94. For an attempt to conceptualise the nature of exceptions and limitations, see A. Christie, ‘Maximising permissible exceptions to intellectual property rights’, in Kur, A. and V. Myzaras (eds), The Structure of Intellectual Property Law – Can One Size Fit All?, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2011, 121. It has been stated however, that the terms of exceptions and limitations in the Directive were consciously used to express that they are construed as defences against accusations of infringement of a property right, and not as users’ rights. See von Lewinski in Walter and von Lewinski, 2010, at 11.5.11. In Joined Cases C-457/11 to C-460/11 VG Wort 2013] EUECJ C-457/11, the CJEU held that the distinction in the ‘in the very title’ of Article 5 should be given effect. In its view, ‘the exclusive right may, depending on the circumstances, be either, as an exception, totally excluded, or merely limited. It is conceivable that such a limitation may include, depending on the particular situations that it governs, in part an exclusion, a restriction, or even the retention of that right’ (para. 34). R. Burrell and A. Coleman, Copyright Exceptions: The Digital Impact, Cambridge University Press, 2005, 4. See E.J. Hudson, ‘Copyright exceptions: The experiences of cultural institutions in the United States, Canada and Australia’, 2011, 15. See M. Van Eechoud, et al., Harmonizing European Copyright Law, The Challenges of Better Lawmaking, Wolters Kluwer Law & Business, Alphen aan den Rijn, 2009, 103, see infra.

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particular, digital environment on the other.120 However, the open wording of Article 5 does, despite the latter’s closed nature, offer some room for flexibility.121 We will get back to this point below.

2. A list of predominantly optional limitations A. One mandatory exception As stated above, the approach chosen in Article 5 is the one of an optional exhaustive list of 11.73 exceptions and limitations. Yet, the transposition of one limitation, the limitation for transient or incidental copies laid down in its first paragraph, was mandatory for Member States. Context and conditions of applicability of Article 5(1) will be explained in more detail below. B. Twenty optional exceptions or limitations Next to the mandatory exception for ephemeral copies, Article 5 offers Member States a list of 20 11.74 exceptions or limitations which they can choose to implement or not. Article 5(2) provides for five optional exceptions or limitations to the reproduction right: reprographic copying, private copying, non-profit copying by public libraries, educational establishments or museums, ephemeral copying by broadcasters, and reproductions of broadcasts made by social institutions. Article 5(3) then lists 15 optional exceptions or limitations to both the right to reproduce and the right to communicate to the public or make available to the public: use for teaching and scientific purposes, uses for people with disabilities, use for reporting current events, quotations, uses for public security, use of political speeches, use during religious celebrations, use of works of architecture, incidental inclusion of a work or other subject-matter, use for advertising public exhibitions, use for caricature, parody or pastiche, use related to the demonstration or repair of equipment, use for the reconstruction of buildings, use for research or private study, and use in other cases of minor importance. The wording of some of the above-mentioned exceptions has been amended by the Digital Single Market Directive (Directive 2001/29/EC) and the Directive implementing the Marrakesh Treaty in the EU (Directive (2017/1564). In addition to the exceptions and limitations of Article 5, other Directives, such as the Orphan 11.75 Works Directive (Directive 2012/28/EU) and the Digital Single Market Directive, introduced further exceptions and limitations to Articles 2 and 3 of the Information Society Directive, corresponding to the reproduction right and the right of communication to the public. These exceptions and limitations are discussed in the chapters corresponding to each Directive. Some of the exceptions or limitations listed in Article 5’s second and third paragraphs will be discussed in more detail below. Article 5(4) allows Member States – where necessary – to provide for exceptions or limitations to 11.76 the distribution right; this applies to cases where Member States equally allow those exceptions or limitations in relation to the reproduction right.

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See, for instance, L. Guibault, ‘Why cherry-picking never leads to harmonisation: The case of the limitations on copyright under Directive 2001/29/EC’, (2010) JIPITEC 1, 55 57; see also for example M. Senftleben (2010a), ‘The international three-step test. A model provision for EC Fair Use Legislation’, (2010) JIPITEC, 1, 67, or Van Eechoud et al., 104. As convincingly demonstrated in P.B. Hugenholtz and M. Senftleben, 2011, ‘Fair use in Europe. In search of flexibilities’, 13 et seq. Detailed on the flexibilities left by the Directive, see also C. Geiger and F. Schönherr, ‘Defining the scope of protection of copyright in the EU: The need to reconsider the acquis regarding limitations and exceptions’, in T-E. Synodinou (ed.), Codification of European Copyright Law, Challenges and Perspectives, Kluwer Law International, Alphen aan den Rijn, 2012, 133 et seq.

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11.77 It has often been suggested that exceptions and limitations be divided into different categories according to their respective justification. Possible categories would be freedom of expression or fundamental rights in general (also including, e.g. the right to privacy), public interest, and market failure or practical justifications.122 In the exhaustive list, limitations justified by fundamental rights would be the ones relating to press, to quotations, to caricature, to religious celebrations or to private copying (see infra); public interest considerations justify limitations relating to education and libraries, social institutions, people with a disability, public security, use of works made to be located in public places or to promote a public exhibition; limitations relating to temporary acts of reproduction, to ephemeral recordings related to broadcasting, use in connection with the demonstration or repair of equipment or reconstruction of a building may rather be explained by practical reasons.123 Yet, although such a categorisation is useful insofar as it helps to identify the rationale underlying the permitted use, it is not easy to establish, since exceptions and limitations often have multiple justifications.

3. The limit of Member States’ discretion: the three-step test of Article 5(5) A. International and EU three-step test 11.78 All uses potentially covered by one of the exceptions and limitations listed in Article 5 have, in addition, to comply with the so-called three-step test laid down in Article 5(5) of the Directive. According to the latter, limitations shall only apply in ‘certain special cases which do not conflict with a normal exploitation of the work or other subject-matter and do not unreasonably prejudice the legitimate interests of the right holder’. Recital 44 specifies that, in particular with regard to the electronic environment, ‘the scope of certain exceptions or limitations may have to be even more limited when it comes to certain new uses of copyright works and other subject-matter’.124 The fifth paragraph of Article 5, in potentially further restricting the scope of unauthorised uses of works protected by copyright, has been the subject of broad debate and criticism.125 In fact, the idea that the ‘three-step test’ in the Directive is a further restriction mechanism to the scope of limitations and exceptions appears to deviate from its model: the international three-step test, laid down in Article 9(2) of the Berne Convention, Article 13 of the TRIPS Agreement, and Article 10 of the WIPO Copyright Treaty (the WCT, which extends the scope of application of the test to all rights set out in the Berne Convention and the WCT). Of central importance to copyright, this international tool has been qualified as ‘an essential, flexible element that allows national law makers to satisfy domestic social, cultural, and economic needs’.126 Indeed, the agreed statement concerning

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See Hugenholtz, 1997; also see in general S. Karapapa, Defences to Copyright Infringement: Creativity, Innovation and Freedom on the Internet, Oxford University Press, 2020. The European Copyright Code speaks of ‘uses with minimal economic significance’ (Art. 5(1) of the Code), and thereby proposes to introduce a de minimis rule. The Code, moreover, proposes to introduce a new category of limitations covering ‘uses for the purpose of enhancing competition’ (Art. 5(4) of the Code). AG Cruz Villalón takes the view that given the principle of narrow interpretation and the fact that the three-step test is to be applied in addition to the conditions of each individual exception or limitation, the private copying exception could not be extended to situations not expressly foreseen by the Directive. AG Cruz Villalón in Case C-435/12 ACI Adam BV, Opinion delivered on 9 January 2014, at 71. As affirmed in Case C-435/12 ACI Adam BV [2014] EUECJ C-435/12: ‘Article 5(5) of Directive 2001/29 is not intended either to affect the substantive content of provisions falling within the scope of Article 5(2) of that directive or, inter alia, to extend the scope of the different exceptions and limitations provided for therein.’ Senftleben argues that the option chosen in the Directive, an ‘open-ended three-step test’ that erodes ‘legal certainty following from precisely defined exceptions instead of using the test as a means of providing sufficient flexibility’, leads to a ‘worst case scenario’: a system that offers neither flexibility nor legal certainty. Senftleben, 2010a, 68. Senftleben, 2010a, 67. See also detailed on the issue, C. Geiger, D. Gervais and M. Senftleben, ‘The Three Step Test Revisited: How to Use the Test’s Flexibility in National Copyright Law’ (with D. Gervais and M. Senftleben), PIJIP Research Paper no. 2013-04; forthcoming in: American University International Law Review 2014.

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Article 10 of the WCT127 permits Contracting Parties ‘to carry forward and approximately extend into the digital environment limitations and exceptions in their national laws’, and ‘to devise new exceptions and limitations that are appropriate in the digital network environment’.128 Moreover, the preamble to the WCT recognises ‘the need to maintain a balance between the rights of authors and the larger public interest, particularly education, research and access to information, as reflected in the Berne Convention’.129 According to Recital 44 of the Directive, exceptions and limitations ‘should be exercised in accordance with international obligations’.130 In order to open up the current EU system of limitations, it would be advisable to read the EU 11.79 three-step test in a manner coherent with its international background originating from the WIPO treaties or the TRIPS Agreement;131 the aim being to achieve a better balance of interests (see infra). International agreements concluded by the Union are binding upon EU institutions and Member States (Art. 216 TFEU).132 Considering the currently fragmented harmonisation of copyright law, it could, therefore, be argued that the EU three-step test should at least have to be read in the light of the corresponding provisions of WCT and TRIPs,133 both mixed agreements.

B. Article 5(5) as a tool for flexible interpretation of limitations Proposals suggesting that the three-step test could be construed as an enabling clause similar to a 11.80 generally worded ‘EU-fair use’ type provision134 have been welcomed by many. It is argued that

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Article 31(1) of the 1969 Vienna Convention of the Law of Treaties states that a ‘treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose’. Such context shall include, amongst other things, ‘any agreement relating to the treaty which was made between all the parties in connection with the conclusion of the treaty’ (Art. 31(2)(a)). The agreed statement adds, however, that Art. 10(2) of the WCT ‘neither reduces nor extends the scope of applicability of the limitations and exceptions permitted by the Berne Convention’. It has been suggested that WCT members agree to remove this last statement: S. Ricketson, WIPO information session on limitations and exceptions, 2008. Ricketson, moreover, proposes adding further steps to the test, thereby increasing focus on public interest justifications and recognition and protection of moral rights. See for example in this sense, M-C. Janssens, ‘The issue of exceptions: Reshaping the keys to the gates in the territory of literary, musical and artistic creation’, in E. Derclaye (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2009, 323. One of the goals of the Directive was, indeed, to transpose the international obligations arising from the WCT. Recital 44 has, therefore, been said to particularly address Art. 10 WCT. As confirmed by the agreed statement and the preamble, Art. 10 is also thought to be a guideline for the extension of existing and introduction of new limitations (see M. Senftleben, ‘Comparative approaches to fair use: An important impulse for reforms in EU Copyright Law’, in G.B. Dinwoodie (ed.), Methods and Perspectives in Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/ Northampton (US), (2014), 30 sq.). See C. Geiger, D. Gervais and M. Senftleben, ‘Understanding the “Three-Step Test”‘, in D. Gervais (ed.), Research Handbook on International Intellectual Property Law, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2014 (forthcoming). In Hermès, the Court stated that EU law should be interpreted in the light of the TRIPs as a WTO agreement, and thereby affirmed the principle of harmonious application (Case C-53/96 Hermès International v FHT Marketing Choice [1998] ECR I-3603). In Case 181/73 Haegemann v Belgian State [1974] ECR 449, concerning a mixed agreement, the Court held that the provisions of an agreement, ‘from the coming into force thereof, form an integral part of Community law’ (para. 5). In Case C-61/94 Commission of the European Communities v Federal Republic of Germany [1996], ECR 1996 Page I-03989, the Court held that secondary law must, insofar as is possible, be interpreted in a manner that is consistent with international agreements concluded by the EU (para. 52). Regarding Art. 13 TRIPs, it might, read with reference to the public interest considerations in Arts 7–8 TRIPS, allow for wider exceptions. Art. 2(2) TRIPS emphasises that the provisions of the Agreement shall not ‘derogate from existing obligations that Members may have to each other under the […] Berne Convention’; yet, it has been held that if Art. 2(2) does not allow the creation of new exceptions, further restrictions may be added cumulatively as long as they are consistent with existing provisions. See Ricketson, 2008. In this sense see K.J. Koelman, ‘Fixing the three-step test’ (2006) EIPR 28(8), 407–12, 407; M. Senftleben, ‘Beperkingen à la carte: Waarom de Auteurrechtrichtlijn ruimte lat voor fair use’, (2003) AMI, 10, M. Senftleben ‘L’application du triple test: vers un système de fair use européen?’ (2007), Propriétés intellectuelles 25, 453–60, 453 et seq., M. Senftleben, ‘Fair use in the Netherlands – A renaissance?’ (2009), Tijdschrift voor auteurs, media en informatierecht 1,

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rights of users and right holders could be better balanced if the criteria of the three-step test were understood as open-ended factors; at the same time, it should be recognised that such criteria equally allow for the introduction and broadening of limitations (and not only for their restriction). 11.81 For better practical applicability of proposals suggesting a more open interpretation of the three-step test at the international, regional, and national level, a group of scholars elaborated a ‘Declaration on the Balanced Interpretation of the Three-Step Test in Copyright Law’ (the Declaration).135 The drafters of the Declaration call, among other things, for a comprehensive overall assessment, whereby ‘no single step is to be prioritized’.136 Moreover, the Declaration clearly states that limitations are not necessarily to be interpreted narrowly, and according to their objectives and purposes.137 With regard to the first step, it might be considered that a certain special case is assumed in all situations described in Article 5;138 the Declaration suggests that step number one should neither be an impediment to the introduction, under certain conditions, of open ended limitations, nor to the extended application of existing limitations or to the creation of new ones by the judiciary.139 As to the second step, the Declaration claims that its conditions should be fulfilled if the limitation is based on important competing considerations, or helps counter anti-competitive practices or effects.140 With regard to the third step, the Declaration focuses on adequate compensation, which should provide for sufficient incentives for the continued creation and dissemination of works.141 Consideration should also be given to third parties’ interests, relating, amongst others, to human rights, public interests, or competition.142

1; Senftleben, 2010a, 68; C. Geiger ‘Flexibilising copyright’, (2008a), IIC, 178; C. Geiger, ‘The role of the three-step test in the adaptation of copyright law to the information society’, (2007b), e-Copyright Bulletin, 15 et seq.; C. Geiger, ‘Limitations and exceptions, “fair use” and the three-step test in relation to educational materials – A European perspective’, 2012b. See, for example, the decision of the Court of Appeal of Barcelona (SAP), 17 September 2008. Westlaw AC 2008/1773. Commenting on this decision, one scholar notes that the three-step test: is set to guide the interpretation and application of the statutory exceptions in similar terms to what the ‘fair use’ doctrine does in sec. 107 USCA, the ruling showing ‘the tendency of Spanish Courts to use the three-step-test as a flexible interpretation clause, and not only as a restrictive instrument, in the application of the statutory exceptions’.

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R. Xalabarder, ‘Google News and Copyright’, in A. Lopez-Tarruella (ed.), Google and the Law, T.M.C. Asser Press, The Hague, 2012, 147, note 168. According to this scholar, ‘Spanish case law proves that the test can be used by courts not to further “restrict” the scope of a statutory exception but to provide for some well-needed room to “manoeuvre” in applying the exceptions to specific cases and scenarios’, R. Xalabarder, ‘Fair Use in Spain. The EUCD Aftermath’, in G. Ghidini and L.M. Genovesi (eds.), Intellectual Property and Market Power, EUDEBA, Buenos Aires, 2008, 819. On this declaration, see C. Geiger, R. Hilty, J. Griffiths and U. Suthersanen, ‘Declaration a balanced interpretation of the ‘three-step test’ in copyright law’ (2010) JIPITEC, 1, 119, 2008, 489. For a proposal to take the declaration further and draft interpretation guidelines to be incorporated in a soft law instrument at the international level, see C. Geiger, ‘Implementing an International Instrument for Interpreting Copyright Limitations and Exceptions’, 2009, 627. See the considerations of the Declaration. According to Art. 1 of the Declaration, ‘the three-step test constitutes an indivisible entirety. The three steps are to be considered together and as a whole in a comprehensive overall assessment’. Point 2 of the Declaration. (On the ‘principle’ of narrow interpretation, see infra). The Court of Justice’s reasoning in FAPL, as well as in Case C-302/10 Infopaq II [2012] EUECJ C-302/10, suggests that, at least in relation to Art. 5(1), the text of the provision itself has taken into consideration all three steps: […] suffice it to note that if those acts of reproduction fulfil all the conditions of Article 5(1) of Directive 2001/29, as interpreted by the case-law of the Court, it must be held that they do not conflict with the normal exploitation of the work or unreasonably prejudice the legitimate interests of the rightholder […]. (Infopaq II, para. 56).

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In AG Cruz Villalón’s view, the precise definition of exceptions and limitations in Article 5 in any case strives at passing the first step of the test. AG Cruz Villalón in Case C-435/12 ACI Adam BV, Opinion delivered on 9 January 2014, at 51. Point 3 of the Declaration. Point 4 of the Declaration. Point 4 and considerations of the Declaration. Point 6 of the Declaration.

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III. EFFECT OF ARTICLE 5 1. A degree of harmonisation A. Increased convergence among the different systems Recital 32 of the Directive states that ‘Member States should arrive at a coherent application of 11.82 these exceptions and limitations, which will be assessed when reviewing implementing legislation in the future’. Indeed, various studies were carried out once all Member States had actually finished the implementation of the Directive.143 Given the optional nature of the 20 exceptions and limitations proposed in Article 5, the general feedback of academia has been that the provision’s harmonising effect proved to be minimal.144 Not only was the optional character considered to be an obstacle to proper approximation of national laws; the fact that Member States also had discretion as to the way in which the relevant provisions are both transposed and interpreted has helped them hold on to particularities of their national regimes.145 It might, however, be objected that such criticism actually amounts to criticism of the choice of a Directive as a legal instrument: Directives are only binding as to the result to be achieved, and by nature leave the choice of form and methods up to the Member States (Art. 288 TFEU, see supra).146 The cautious approach of Article 5 has also been justified by reasons of competence.147 Yet, the fragmented landscape of limitations across Europe fails to offer legal certainty, even though, especially in the context of the online environment, certainty regarding allowed uses is crucial. However, some positive effects might be noted: the implementation process did give Member 11.83 States the opportunity to review their copyright regimes and thereby to reconsider their definition of the scope of exclusive rights;148 many Member States have thus introduced new exceptions and limitations. In any case, a thorough review of Article 5 is necessary (see infra); yet, some of the items that are being discussed such as, e.g. the possible introduction of a fair use type opening clause into EU law, are politically and legally difficult to realise. A few Member States, as for instance currently the UK, therefore envisaged reforming their regime of exceptions and limitations within the legal framework of Article 5. The Hargreaves Review stated that the UK did not exploit all exceptions

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See, for instance, Van Eechoud et al., 2009, or G. Westkamp, ‘Part II, The Implementation of Directive 2001/29/EC in the Member States’, Centre for Commercial Law Studies, Queen Mary, University of London, February 2007. These studies revealed that the Member States’ regimes of exceptions and limitations still diverged in many ways after implementation of the Directive. The number, as well as the form and extent of limitations available is thus not uniform throughout the EU. See, amongst others, Guibault, 2010, 57. See also S. Bechtold, ‘Information Society Directive, Article 5’, in T. Dreier and P.B. Hugenholtz, Concise European Copyright Law, Kluwer Law International, Alphen aan den Rijn, 2006, 369: ‘Due to the broad latitude left to Member States regarding which limitations to implement in what way, it is questionable whether art. 5 will lead to true harmonisation of copyright limitations across the European Union’; Janssens, 332. More generally on this issue see P.B. Hugenholtz, ‘The dynamics of harmonization of copyright at the European level’, in C. Geiger (ed.), Constructing European Intellectual Property: Achievements and New Perspectives, EIPIN Series vol. 1, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2013, 273 et seq. See Van Eechoud et al., 2009, 105. It has been argued that harmonisation should not lead to uniformity, and that Directives should thus leave some discretion to Member States to adapt to their domestic needs and local cultural traditions. See Guibault, 2010, 57, referring to the Legal Advisory Board (LAB), Commentaires du Legal Advisory Board sur la Communication de la Commission du 20 novembre 1996: Suivi du Livre vert, § 9A. Sentence 3 of Recital 32 states that the ‘list takes due account of the different legal traditions in Member States, while, at the same time, aiming to ensure a functioning internal market’. A higher degree of harmonisation was, at the time of the adoption of the Directive, considered sufficient in view of the criterion of necessity to ensure the proper functioning of the internal market. See von Lewinski, 2010, at 11.5.9. See F. Gotzen, ‘Copyright in Europe: quo vadis? Some conclusions after the implementation of the information society harmonisation directive’, (2007) RIDA, 211, 3, 4; see von Lewinski, 2010, at 11.5.9.

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available in EU law.149 In its response to the copyright consultation,150 the UK Government announced it would ‘legislate for a new system of permitted acts for copyright works […] through the smallest possible number of Statutory Instruments’ to help the ‘system be clear and consistent’.151 Indeed, the UK Copyright, Designs and Patents Act was subject to reform in 2014. The result was the introduction of new copyright exceptions and limitations and the broadening of the scope of previously existing exceptions and limitations.

B. One EU-wide mandatory limitation for transient copies (Art. 5(1)) 11.84 Article 5(1), the only mandatory provision, was implemented literally in almost all Member States.152 Recital 33 explains the purpose of Article 5(1) in more detail.153 In a number of decisions, the Court of Justice has, moreover, clarified the meaning and scope of the provision. In LSG, the Court shed some light on the meaning of ‘intermediaries’.154 In Infopaq, the Court held that the conditions set out in Article 5(1) are cumulative, and need to be interpreted in a restrictive manner, in the light of Article 5(5).155 In Infopaq II, however, the Court stated that the three-step test should, in theory, not further restrict the scope of the exception for transient copies: ‘[…] if those acts of reproduction fulfil all the conditions of Article 5(1) of Directive 2001/29, as interpreted by the case-law of the Court, it must be held that they do not conflict with the normal exploitation of the work or unreasonably prejudice the legitimate interests of the rightholder’.156 In FAPL, the CJEU acknowledged that the ‘interpretation of those conditions must enable the effectiveness of the exception […] and permit observance of the exception’s purpose’157 (see also infra). Besides, the Court clarified the meaning of independent economic significance, stating that, in this case,

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See Hargreaves, 2011, 42. Hargreaves concludes that there are ‘genuine legal doubts about the viability of a US case law based legal mechanism in a European context’. (52). See also J. Smith and R. Montagnon, ‘The Hargreaves Review – A “digital opportunity”‘, (2011) EIPR, 33(9) 596–9, 597. HM Government, ‘Modernising copyright: a modern, robust and flexible framework, Government response to consultation on copyright exceptions and clarifying copyright law’, published on 20 December 2012; it had already broadly accepted the Hargreaves’s ten recommendations in its response issued on 3 August 2011. Ibid., 21. It is proposed, among other things, to introduce a narrow private copying exception, allowing copying of content lawfully owned by an individual to another medium for their strictly personal use; a fair dealing exception for non-commercial use of copyright materials in teaching; an exception allowing fair dealing with quotations, the source needing to be indicated; a new ‘copyright exception to cover text and data analytics for non-commercial research within certain restricted limits, which will protect publishers from large-scale copyright infringement’; ‘a fair dealing exception allow limited copying for parody, pastiche, while maintain current system of moral rights’; the scope of the research and private study exception is to be extended (16). In summer 2013, the UK Government released sets of draft legislation on copyright exceptions for technical review; they included proposed amendments relating to persons with a disability, data analysis for non-commercial research, education, and research, libraries and archives, as well as for private copying, parody, quotation and public administration. In March 2014, the UK Government informed that it had made a number of technical changes to the draft regulations, and that it would lay the regulations before Parliament soon. See Copyright and Rights in Performances (Research, Education, Libraries and Archives) Regulations 2014. See Westkamp, 2007, 12. It states, among other things, that: […] this exception should include acts which enable browsing as well as acts of caching to take place, including those which enable transmission systems to function efficiently, provided that the intermediary does not modify the information and does not interfere with the lawful use of technology, widely recognised and used by industry, to obtain data on the use of the information. A use should be considered lawful where it is authorised by the right holder or not restricted by law.

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‘[…] access providers which merely provide users with Internet access, without offering other services such as email, FTP or file sharing services or exercising any control, whether de iure or de facto, over the services which users make use of, must be regarded as “intermediaries”’. Case C-557/07 LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH (Order of the Court) [2009] EUECJ C-557/07_O (para. 46). Case C-5/08 Infopaq International A/S v Danske Dagblades Forening [2009] ECR I-6569, paras 56–8. Case C-302/10 Infopaq International A/S v Danske Dagblades Forening (Order of the Court) [2012] EUECJ C-302/10, para. 56. Joined Cases C-403/08 and C-429/08 Football Association Premier League Ltd and Others v QC Leisure and Others (C-403/08) and Karen Murphy v Media Protection Services Ltd (C-429/08) [2011], para. 163.

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‘significance must also be independent in the sense that it goes beyond the economic advantage derived from mere reception of a broadcast containing protected works […]’.158 In Infopaq II, the Court added that ‘[…] an advantage derived from an act of temporary reproduction is distinct and separable if the author of that act is likely to make a profit due to the economic exploitation of the temporary reproductions themselves’.159 ‘The same is true if the acts of temporary reproduction lead to a change in the subject matter reproduced, as it exists when the technological process concerned is initiated, because those acts no longer aim to facilitate its use, but the use of a different subject matter.’160 In Meltwater, clarification was given on the ‘application of copyright law to the technical processes involved in viewing copyright material on the internet’.161 According to the British court, one objective of Article 5(1) is to ‘authorise the making of copies to enable the end-user to view copyright material on the internet’, and the Article’s conditions should be construed in a manner consistent with that purpose; indeed, the CJEU held that such activity satisfies the conditions that the copies must be temporary, that they must be transient or incidental in nature and that they must constitute an integral and essential part of a technological process, as well as the conditions laid down in Article 5(5) of the Information Society Directive, with the effect that authorisation from the copyright holders is not necessary.162 In Case C-527/15 Stichting Brein v Jack Frederik Wullems [2017] EUECJ C-527/15, the CJEU held that according to Article 5(1) and (5), acts of temporary copying on a multimedia player of a copyright work obtained by streaming from a third-party website without the consent of the copyright holder does not satisfy the conditions set out in those Articles.

2. The role of case law A. Case law of the CJEU: enhancing transparency through harmonious interpretation So far, Article 5’s harmonising effect has been modest. It has, however, been advanced by the CJEU 11.85 by way of interpretation. i.

Harmonising effect of the Directive’s recitals

When interpreting the exceptions and limitations set out in Article 5, the CJEU often refers to one 11.86 of the numerous recitals of the Directive.163 Recital 9, for instance, states that ‘[a]ny harmonisation of copyright and related rights must take as a basis a high level of protection […]’; Recital 4 explains that ‘[a] harmonised legal framework on copyright and related rights’ should provide ‘for a high level of protection of intellectual property’. These statements of reasons have reinforced the principle of a broad interpretation of rights, and of a narrow interpretation of exceptions.164 In principle, ‘the purpose of the recitals is to set out concise reasons for the chief provisions of the enacting terms, without reproducing or paraphrasing them. They shall not contain normative provisions or political

158 159 160 161

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FAPL, para. 175. Sentence 2 of Recital 33 states that ‘the acts of reproduction concerned should have no separate economic value on their own’. Infopaq II, para. 52. Ibid., para. 53. UKSC 18 Public Relations Consultant Association Limited (Appellant) v The Newspaper Licensing Agency and others (Respondents) [2013], para. 1. See Case C-360/13 Public Relations Consultants Association Ltd v The Newspaper Licensing Agency Ltd and others [2014] EUECJ C-360/13. UKSC 18, para. 27; also see Case C-360/13 Public Relations Consultants Association v Newspaper Licensing Agency Ltd and Ors [2014] EUECJ C-360/13. The Directive contains 61 recitals, placed between the citations and the enactment terms, i.e. the legislative provisions. See, for instance, Infopaq, paras 56–9 (see supra). With regard to the cumulative conditions of applicability of Art. 5(1), the Court stated that ‘[i]n accordance with recitals 4, 6 and 21 […], the conditions laid down in Article 5(1) thereof must also be interpreted in the light of the need for legal certainty for authors with regard to the protection of their works’ (para. 59).

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exhortations’.165 As to basic legislative acts, ‘the statement of reasons should seek to expound the general philosophy of the act […]. But specific reasons will be given for a number of individual provisions either because of their importance or because they are not inherent in the general philosophy’.166 As to special provisions, recitals should pay particular attention to provisions such as ‘derogations; departures from the general scheme of rules; exceptions to a general principle […]’.167 Indeed, Recitals 31–40 of the Directive relate to limitations: they explain the general functioning of Article 5, and of some of the specific exceptions included in the latter. There has been debate about the actual legal effect of recitals in EU legislation. The Court clarified that ‘[…] the preamble to a Community act has no binding legal force and cannot be relied on as a ground for derogating from the actual provisions of the act in question’.168 A recital could therefore not restrict a right.169 Recitals may be used as an interpretative tool in the context of ambiguous provisions, i.e. to clarify the nature or scope of a provision; it has, however, been held that purposive interpretation by reference to a recital diminishes legal certainty.170 Yet, in the case of Article 5, the regular reference to recitals has, by clarifying the scope of certain exceptions, often led to a more harmonious application of the different provisions. In DR, TV2 Danmark A/S, for instance, the Court stated, in regard to the divergence between the different language versions of Recital 41, that the latter had ‘to be interpreted by reference to the purpose and general scheme of the rules of which it forms part’;171 it clarified that the two conditions set out in Recital 41 must be understood as being equivalent and, therefore, alternative in nature.172 Interestingly, this interpretation of a broadcaster’s own facilities led to a broader scope of the exception of Article 5(2)(d).173 With a view to a possible revision of the Directive, it would be desirable that the recitals take the above-outlined importance of limitations for the enhancement of creativity into account. If legal certainty for right holders is important, this equally applies to users and potential creators regarding allowed uses of works.

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Point 10 of the Joint Practical Guide of the European Parliament, the Council and the Commission for persons involved in the drafting of legislation within the Community institutions (‘the Guide’), accessible at http://eurlex.europa.eu/en/techleg/10.htm. Point 10.2 of the Guide specifies: [t]he purpose [of stating reasons] is to enable any person concerned to ascertain the circumstances in which the enacting institution exercised its powers as regards the act in question (see Case 24/62 Germany v Commission [1963] ECR 63), to give the parties to a dispute the opportunity to defend their interests and to enable the Community judicature to exercise its power of review.

166 167 168 169

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Point 10.9 of the Guide. Point 10.14 of the Guide. Case-162/97 Nilsson and others [1998] ECR I-7477, para. 54. See T. Klimas and J. Vaiciukaite, ‘The Law of Recitals in European Community Legislation’ (2008) ILSA Journal of International and Comparative Law, 15, 26. Such reasoning would not only favour right holders, but also legitimate users, if limitations were to be understood as subjective rights. Ibid, 26–7. Recitals’ legal effect is limited: as stand-alone provisions (i.e. not in correlation with legislative provision), they cannot create any legitimate expectations. In Case C-63/93 Duff and others [1996] ECR I-569, the Court held that: [the principle of legitimate expectations] […] which is part of the Community legal order (see the judgement in Joined Cases 205/82 to 215/82 Deutsche Milchkontor and Others v Germany [1983] ECR 2633, paragraph 30), is the corollary of the principle of legal certainty, which requires that legal rules be clear and precise, and aims to ensure that situations and legal relationships governed by Community law remain foreseeable (para. 20).

171 172 173

Such a definition should not be applicable to recitals, which constitute statements of intent. See Klimas and Vaiciukaite, 30. Case C-510/10 DR, TV2 Danmark A/S v NCB – Nordisk Copyright Bureau 012] EUECJ C-510/10. Ibid., paras 55–56. The Court comes to the conclusion that in view of the aim and objective of the exception, the conditions set out in the recital are to be seen as cumulative – even if the recital uses the connective term ‘and’.

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ii.

The ‘mitigated’ principle of narrow interpretation

In the CJEU’s view, the exclusive right appears to be the principle, and the exception the derogation 11.87 from the principle.174 Apart from the above-mentioned Recitals 4 and 9, Recital 21 states, with regard to the reproduction right, that ‘[a] broad definition of these acts is needed to ensure legal certainty within the internal market’. Consequently, the right will be interpreted broadly, and the exception in a restrictive manner.175 This tendency to interpret exceptions and limitations narrowly can also be observed at the national level in most Member States;176 it has been qualified as a symptom of the ‘right owner’-centred perspective of the EU copyright acquis.177 Recent decisions defining ‘communication to the public’ broadly confirm this view.178 Furthermore, with the coming into force of the Treaty of Lisbon on 1 December 2009, the Charter of Fundamental Rights of the European Union (‘the Charter’) has become primary law of the EU. Copyright has been said to henceforth enjoy a special status within EU law: it is, first, protected by secondary law (i.e. the various Directives at the legislative level), and, secondly, by primary law, as the fundamental right to intellectual property.179 The broad interpretation of notions such as ‘work’, ‘communication to the public’, or ‘remuneration’ (see infra) has thus been held to amount to a broad interpretation of the exclusive right, which would also be enshrined in Article 17(2) of the Charter.180 As the Court clarified in Promusicae, the Directive and the national law implementing its provisions need to respect the fundamental rights guaranteed in the Charter.181

174 175

It has been held that narrow interpretation of exceptions is ‘based upon an alleged principle of European Law, rather than on a principle of copyright law’. Westkamp, 2013. In Case C-5/08 Infopaq International A/S v Danske Dagblades Forening [2009] ECR I-6569, the Court held, in relation to Art. 5(1) of the Directive and to the reproduction right, that: […] according to settled case-law, the provisions of a directive which derogate from a general principle established by that directive must be interpreted strictly […]. This holds true for the exemption provided for in Article 5(1) of Directive 2001/29, which is a derogation from the general principle established by that directive, namely the requirement of authorisation from the rightholder for any reproduction of a protected work. (paras 56–7)

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See also Joined Cases C-403/08 and C-429/08 FAPL, para. 162, or Case C-302/10 Infopaq II, para. 27. It has been held that the narrow interpretation of ‘exceptions’ to the exclusive right in authors’ rights countries such as France can be explained by the natural justice rationale that still underlies these copyright systems. A counterexample is the US copyright system, based on a mainly utilitarian doctrine, where fair use allows a wide range of uses under certain conditions, with special focus being on the notion of possible harm. See P. Goldstein and B. Hugenholtz, International Copyright, Principles, Law and Practice, 2nd ed., Oxford University Press, New York, 2010, 6–7. See on this issue T. Dreier, ‘Limitations: The centrepiece of copyright in distress’, 2010, JIPITEC, 1, 51. In C-607/11 ITV Broadcasting Ltd, ITV 2 Ltd, ITV Digital Channels Ltd, Channel 4 Television Corporation, 4 Ventures Ltd, Channel 5 Broadcasting Ltd, ITV Studios Ltd v TV Catchup Ltd, 7 March 2012, [2013] EUECJ C-607/11, the Court stated that the concept of communication must be defined in the light of the context in which it occurs and in light of the objective to establish a high level of protection of authors (para. 22). Exhaustion does not apply to the right of communication to the public, which is granted for each transmission or retransmission of a work which uses a specific technical means (paras 23–24). See J. Malenovský, ‘La contribution de la Cour de justice à l’harmonisation du droit d’auteur dans l’Union européenne’, ERA Forum, August 2012. See also Geiger, 2010, 255. See Malenovský. In Case C-275/06 Productores de Música de España (Promusicae) v Telefónica de España SAU [2008] ECR I-271, the Court had to weigh the IP right against the right to privacy, and held that: […] the Member States must, when transposing the directives mentioned above, take care to rely on an interpretation of the directives which allows a fair balance to be struck between the various fundamental rights protected by the Community legal order. Further, when implementing the measures transposing those directives, the authorities and courts of the Member States must not only interpret their national law in a manner consistent with those directives but also make sure that they do not rely on an interpretation of them which would be in conflict with those fundamental rights or with the other general principles of Community law, such as the principle of proportionality […] (para. 68).

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11.88 In any case, any maximalist reading of Article 17 (2) in the copyright context, as brought forward by some commentators, does not seem to be justified.182 The rights of the Charter are never absolute. Article 17(1) of the Charter, in the light of which Article 17(2) needs to be read, states that ‘the use of property may be regulated by law insofar as is necessary for the general interest’ (see infra). It could therefore be argued that where a limitation is justified by the public interest, e.g. by public policy goals relating to education or culture, the scope of that limitation should not be further narrowed. Moreover, intellectual property rights need to be weighed against other competing fundamental rights and freedoms, such as the freedom of expression or freedom to conduct business. A general principle according to which one fundamental right, i.e. the right to property, should always be given more weight than competing fundamental rights cannot, in this perspective, be sustained.183 In theory, there should be no hierarchy among the rights guaranteed in the Charter and the weighting will depend on the circumstances of each specific case. Article 52(1) states that: any limitation on the exercise of the rights and freedoms recognised by this Charter must be provided for by law and respect the essence of those rights and freedoms. Subject to the principle of proportionality, limitations may be made only if they are necessary and genuinely meet objectives of general interest recognised by the Union or the need to protect the rights and freedoms of others.

This provision could, at first sight, appear to support the restrictive interpretation of limitations to copyright. Yet it should, in reality, also apply vice versa: a limitation to certain rights and freedoms guaranteed in the Charter by another person’s copyright needs to be necessary and proportional. 11.89 The European Court of Human Rights (ECtHR) clarified its understanding of the interface between copyright and freedom of expression in two recent decisions.184 In Ashby Donald, the complainants, three fashion photographers, argued that their condemnation by French courts for copyright infringement (uploading of photographs to a website without the author’s consent) violated their freedom of expression as guaranteed by Article 10 of the Convention. 11.90 In this case, the ECtHR first established that the condemnation does constitute interference by a public authority to the complainants’ freedom of expression.185 The large discretion accorded to Member States in the context of, in particular, commercial speech, is being highlighted.186 In considering that the restriction of freedom of expression for the protection of copyright was

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See Geiger, 2009a, ‘Intellectual Property shall be protected!? Article 17(2) of the Charter of Fundamental Rights of the European Union: a Mysterious Provision with an Unclear Scope’, (2009) EIPR 31(3), 113–17; J. Griffiths and L. McDonagh, ‘Fundamental rights and European IP law: The case of Art 17(2) of the EU Charter’ in C. Geiger (ed.), Constructing European Intellectual Property: Achievements and New Perspectives, 75 et seq. The German Constitutional Court confirmed, in a case relating to the making available of articles including pictures of works of art in an online archive, that in cases involving conflicting fundamental rights, narrow interpretation of copyright limitations must not be the rule. At the same time, the conflicting fundamental right, in this case the freedom of press, cannot, as a general rule, always prevail over the right to property. Interpretation of the statutory limitation must take into account the wording of the provision, the motivation of the legislator, and aim and objective of the rule. See 1 BvR 1145/11, MMR 2012, 177. In Ashby Donald and others v France, appl. no 36769/08 [2013], the ECtHR recognised that Art. 10 of the Convention can be applicable to copyright cases, but leaves a wide margin of appreciation to Member States, notably when it comes to commercial speech (paras 39, 40). For a commentary, see D. Voorhoof and I. Høedt-Rasmussen, ‘ECHR: Copyright vs. freedom of expression’, who take the view that although the criteria for balancing the various rights remain unclear, in future cases freedom of expression might be given more weight as compared to copyright. Examples they give are situations involving artistic freedom of expression, political speech, reproduction and communication to the public for the purpose of education or science, etc. See also the ECtHR’s decision in Fredrik Neij and Peter Sunde Kolmisoppi (The Pirate Bay) v Sweden [2013], appl. no 40397/12. On these decisions see Geiger, 2013b, ‘L’utilisation jurisprudentielle des droits fondamentaux en Europe en matière de propriété intellectuelle: Quel apport? Quelles perspectives?’; C. Geiger and E. Izyumenko, ‘Copyright on the human rights trial: redefining the boundaries of the exclusive right through freedom of expression’ (2014) IIC. At para. 35. At paras 39–41.

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prescribed by law and necessary in a democratic society, for the protection of rights of others, the French courts did not exceed their margin of appreciation.187 The Ashby Donald decision is particularly interesting because it addresses copyright law from a 11.91 different angle: as derogation from the principle, which is freedom of expression. Such derogation needs to be prescribed by law and be necessary. If intellectual property is considered as an exception, even the exclusive right might be interpreted narrowly in the future. In this perspective, it may be asked whether the dogma of narrow interpretation of limitations and broad interpretation of rights can be sustained in the future. Considering the foregoing, it seems difficult to justify such reasoning. In this vein, the Court held in FAPL that Article 5(1)’s conditions must be interpreted in such a way 11.92 as to allow for the effectiveness and purpose of the exception, and that ‘[i]n accordance with its objective, that exception must allow and ensure the development and operation of new technologies and safeguard a fair balance between the rights and interests of right holders, on the one hand, and of users of protected works who wish to avail themselves of those new technologies, on the other’.188 In Painer, the CJEU explained that the purpose of the exception of Article 5(3)(d) was to ‘strike a fair balance between the right to freedom of expression of users of a work or other protected subject-matter and the reproduction right conferred on authors’.189 It has been argued that this ‘opening up’ of an exception by FAPL should be understood to apply to all limitations of Article 5, even if a broad interpretation of limitations has so far not been advocated by the CJEU.190 In the absence of clear guidance by the CJEU, national courts may play a role in strengthening the 11.93 position of users. It has been advocated that national courts should, under certain conditions, be authorised to review EU secondary legislation where effective protection of human rights guaranteed in the Charter is not ensured.191 At least, even without such a radical understanding, a reading of the different limitations and exceptions in the light of fundamental rights could lead to greater understanding of the existing provisions in the Directive. On the intersection of copyright and human rights, the question arises whether a defendant can rely 11.94 directly on the fundamental right underpinning a copyright exception in order to build a defence against allegations for copyright infringement. On July 2019, the CJEU held that fundamental rights, such as freedom of information and of the press cannot justify a derogation from the rights of copyright holders beyond what is allowed under copyright exceptions and limitations. Yet,

187 188

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At para. 42. Joined Cases C-403/08 and C-429/08 Football Association Premier League Ltd and Others v QC Leisure and Others (C-403/08) and Karen Murphy v Media Protection Services Ltd [2011] EUECJ C-403/08), para. 164. The suggested flexible interpretation of limitations has been welcomed: See A. Metzger, ‘Der Einfluss des EuGH auf die gegenwärtige Entwicklung des Urheberrechts’, 2012, 123. Case C-145/10 Eva-Maria Painer v Standard VerlagsGmbH and Others [2011] EUECJ C-145/10, para. 134. The Court concluded: [t]hat fair balance is struck, in this case, by favouring the exercise of the users’ right to freedom of expression over the interest of the author in being able to prevent the reproduction of extracts from his work which has already been lawfully made available to the public, whilst ensuring that the author has the right, in principle, to have his name indicated. (para. 135)

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See C. Berger, ‘Aktuelle Entwicklungen im Urheberrecht – Der EuGH bestimmt die Richtung’ (2012) ZUM, 358. Berger suggests that the future formula of interpretation of limitations might be phrased as follows: ‘narrow, but appropriate to the purpose’. See also Metzger, 2012, who speaks about a partial renunciation to the narrow interpretation of limitations, and of an emerging ‘flexibilisation’ of interpretation of limitations (123 et seq.). In the EU legal order, rights of the Charter would have primacy over the principle of uniform application of EU law. Standard for review would have to be EU primary law, and not national constitutional provisions. Such review would be limited to individual cases relating to individuals, while the construction of general legal principles would remain competence of the CJEU. See D. Leczykiewicz, ‘“Effective judicial protection” of human rights after Lisbon: Should national courts be empowered to review EU secondary law’ (2010) European Law Review, 35(3), 341–5.

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fundamental rights can and should be taken into account when applying the existing exceptions and limitations as these are enshrined in EU law. There is a trilogy of cases that have addressed this issue: Case C-469/17 Funke Medien [2019] EUECJ C-469/17; Case C-476/17 Pelham [2019] EUECJ C-476/17 and Case C-516/17 Spiegel Online [2019] EUECJ C-516/17. In Pelham, the question was whether sampling, i.e. copying of the sounds fixed in a phonogram, requires a licence from the relevant phonogram producer. The CJEU held that unauthorised samples, however short, may infringe a phonogram producer’s rights as they are deemed to be reproductions ‘in part’ of the original work. Commenting on the relationship between fundamental rights and copyright exceptions, the Court held in [34] that: A balance must be struck between [intellectual property rights] and other fundamental rights, including freedom of the arts, enshrined in Article 13 of the Charter, which, in so far as it falls within the scope of freedom of expression, enshrined in Article 11 of the Charter and in Article 10(1) of the European Convention for the Protection of Human Rights and Fundamental Freedoms, signed at Rome on 4 November 1950, affords the opportunity to take part in the public exchange of cultural, political and social information and ideas of all kinds.

In Funke Medien, the Court offered more clarity on how such a balance can be achieved. The case concerned the owner of a website of a German newspaper who requested from competent Germany authorities access to classified, weekly military status reports. The application was rejected for reasons of public security. Funke Medien obtained a portion of the aforementioned documents from an undisclosed source and published individually scanned pages online. The Federal Republic of Germany brought proceedings, requesting the removal of the materials on grounds of copyright infringement. The CJEU held that: freedom of information and freedom of the press, enshrined in Article 11 of the Charter of Fundamental Rights of the European Union, are not capable of justifying, beyond the exceptions or limitations provided for in Article 5(2) and (3) of Directive 2001/29, a derogation from the author’s exclusive rights of reproduction and of communication to the public, referred to in Article 2(a) and Article 3(1) of that directive respectively. In striking the balance which is incumbent on a national court between the exclusive rights of the author referred to in Article 2(a) and in Article 3(1) of Directive 2001/29 on the one hand, and, on the other, the rights of the users of protected subject matter referred to in Article 5(3)(c), second case, and (d) of that directive, the latter of which derogate from the former, a national court must, having regard to all the circumstances of the case before it, rely on an interpretation of those provisions which, whilst consistent with their wording and safeguarding their effectiveness, fully adheres to the fundamental rights enshrined in the Charter of Fundamental Rights of the European Union.

In Spiegel Online, subject to discussion was the compatibility with EU law of an open-ended general copyright exception like the German ‘free use’. The CJEU held that: the exception for quotations applies only if the quotation in question relates to a work which has already been lawfully made available to the public. That is the case where the work, in its specific form, was previously made available to the public with the rightholder’s authorisation or in accordance with a non-contractual licence or statutory authorisation.

On the relationship between intellectual property rights and fundamental freedom the Court echoed the approach adopted in Funke Medien, holding that freedom of information and freedom of the press are not capable of justifying a derogation from the author’s exclusive rights of reproduction and of communication to the public, beyond what is covered in the exceptions or limitations provided for in Article 5(2) and (3) of the Information Society Directive 2001/29. The CJEU further held that in striking the balance between the exclusive rights on the one hand, and, on the other, the rights of the users, a national court should interpret the relevant provisions which, whilst consistent with their wording and safeguarding their effectiveness, fully adheres to the protection of fundamental rights.

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The aforementioned cases illustrate the significant influence of fundamental freedoms on the scope 11.95 and exceptions to intellectual property fundamental freedoms, such as freedom of expression, are vital towards defining the scope of exclusive rights, e.g. the subject matter of copyright protection and, importantly, the contours of copyright exceptions and limitations. According to the CJEU in Funke Medien, para. 70 and Spiegel Online, para. 54: ‘[a]lthough Article 5 of Directive 2001/29 is expressly entitled ‘Exceptions and limitations’, it should be noted that those exceptions or limitations do themselves confer rights on the users of works or of other subject matter’. This express affirmation of the nature of copyright exceptions and limitations as user rights, particularly when such exceptions and limitations are underpinned by a fundamental rights justification, was supported by cross-references to the case law of the European Court of Human Rights. Funke Medien, Pelham and Spiegel Online, however, categorically refuse the application of fundamental rights defences beyond the list of exceptions and limitations enumerated in Article 5 of the Information Society Directive, hence reiterate that copyright has its internal balancing mechanisms in place. iii.

Autonomous concepts of EU law

The CJEU, when interpreting the Treaties,192 renders decisions on the limits of the EU’s 11.96 competence, defines principles of EU law,193 and has at times significantly advanced the process of European integration.194 Its interpretative method is often described as teleological or purposive, and thereby, the purpose of EU law is, e.g. by use of systemic values such as effectiveness or unity, characterised at a broad level.195 Historical interpretation usually plays an ancillary role in the Court’s interpretation, its aim being the coherent and harmonious application of EU law throughout the Union.196 One technique used by the Court, including when it interprets secondary legislation relating to copyright, is the definition of certain notions of a provision as ‘autonomous concepts of Union law’.197 In Padawan, for instance, the Court argued that ‘the concept of “fair compensation” which appears in a provision of a directive which does not contain any reference to national laws must be regarded as an autonomous concept of European Union law and interpreted uniformly throughout the European Union’.198 It has been argued that such an interpretation could be understood to mean that where a limitation of the Directive does not expressly refer to national

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In accordance with Art. 19(1) TEU. Such as direct effect or supremacy. P. Craig and G. De Búrca, EU Law, Text, Cases, and Materials, 2011, 63–4. See, for instance, G. Conway, ‘Levels of generality in the legal reasoning of the European Court of Justice’ (2008) European Law Journal, 14(6), 790 et seq. See also supra on the role of recitals. See J.L. Murray, ‘Methods of interpretation – Comparative law method’, 40. In Case C-283/81 SRL CILFIT v Ministero della Sanità [1982] ECR 3415, the Court stated that: ‘[…] Community law uses terminology which is peculiar to it. Furthermore, it must be emphasized that legal concepts do not necessarily have the same meaning in Community law and in the law of the various Member States’ (para. 19). Finally, every provision of Community law must be placed in its context and interpreted in the light of the provisions of Community law as a whole, regard being had to the objectives thereof and to its state of evolution at the date on which the provision in question is to be applied’ (para. 20).

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In Case C-245/00 Stichting ter Exploitatie van Naburige Rechten (SENA) v Nederlandse Omroep Stichting (NOS) [2003] ECR I-1251, the Court justified this method as follows: […] the Court has already held that the need for uniform application of Community law and the principle of equality require that the terms of a provision of Community law which makes no express reference to the law of the Member States for the purpose of determining its meaning and scope must normally be given an autonomous and uniform interpretation throughout the Community; that interpretation must take into account the context of the provision and the purpose of the legislation in question […] (para. 23)

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Case C-467/08 Sociedad General de Autores y Editores (SGAE) versus Padawan SL [2011] ECDR 1, para. 33. The Court also refers to Recital 32, ‘which calls on the Member States to arrive at a coherent application of the exceptions to and limitations on reproduction rights, with the aim of ensuring a functioning internal market’, and stresses that the Directive’s objective is to ‘[…] ensure competition in the internal market is not distorted as a result of Member States’ different legislation, […] which requires the elaboration of autonomous concepts of European Union law’ (para. 35).

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law regarding the determination of its scope, the EU version of the limitation should be applied.199 In that perspective, many situations listed in Article 5200 could be considered as referring to ‘autonomous concepts of EU law’. In Member States where a limitation’s wording is narrower than the one of the Directive, the wording and scope of the Directive would then have to be applied by national courts.201 In TV2 Danmark, the Court declared the expression ‘by means of its own facilities’ an autonomous concept of EU law. Interestingly, the CJEU emphasised that even if the exception in question (Art. 5(2)(d)) were optional, its interpretation would have to be uniform throughout the Union; in line with the objectives of the Directive, the guiding principle must be a ‘coherent application of the exceptions to and limitations on reproduction rights, with a view to ensuring a functioning internal market’.202 In Johan Deckmyn, the CJEU held that the concept of ‘parody’ should be considered an autonomous concept of Union law, and clarified the specific conditions that a parody must fulfil.203 This technique, in taking an overall, transversal perspective of the various Directives in the field of copyright law,204 has been qualified as a ‘notional approach’.205 It has been criticised as amounting to ‘creeping codification’206 or ‘harmonization by stealth’.207

B. National case law: taking advantage of flexibilities 11.97 Interpretation has thus helped increase the harmonising effect of Article 5; it has, at the same time, been a tool to accommodate the Member States’ diversity and to adapt to a changing context. i.

Respect of the diversity of legal traditions – the openness of Art. 5

11.98 In a Union of 28 Member States, compromise on single provisions applicable to all national legal traditions is usually hard to achieve. A common assumption is that the two main legal regimes represented in the EU, i.e. the common law’s copyright, and the civil law’s authors’ rights, are at times irreconcilable since they are based on approaches influenced by either utilitarianism or natural rights. Both philosophical justifications are, however, present in the two systems; some argue that the traditions will continue to converge as a consequence of regional and international harmonisation and the globalisation of information markets.208 Yet, copyright at the EU level has until now only been partially harmonised and certain key aspects have, apart from harmonisation through international treaties, not been touched. Different intellectual conceptions of copyright do therefore 199

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V-L. Bénabou, ‘Propriétés intellectuelles No. 38’, 2011, at 112. Generally, where national legislators choose to implement one of the exceptions and limitations of Art. 5, ‘these must comply with the specific requirements thereunder […]’, von Lewinski in von Lewinski and Walter, 2010, at 11.5.21. Except Art. 5(3)(o) which refers to limitations present in national legislation. See Geiger and Schönherr, 154. On the harmonising effect of the decisions of the Court of Justice in the field of IP, see Geiger, 2013c, ‘The construction of intellectual property in the European Union: Searching for coherence’, 5; see also Metzger, 2012. Case C-510/10 DR, TV2 Danmark A/S v NCB – Nordisk Copyright Bureau [2017] EUECJ C-649/15, para. 35. Case C-201/13 Johan Deckmyn, Vrijheidsfonds VZW v Helena Vandersteen and Others [2014] EUECJ C-201/13. In Padawan, the Court refers, inter alia, to the concept of ‘equitable remuneration’ of Art. 8(2) of [the Rental Right Directive] (Padawan, para. 33). In Case C-271/10 Vereniging van Educatieve en Wetenschappelijke Auteurs (VEWA) v Belgische Staat [2011], the Court ruled as follows: With regard to the context in which the concept of remuneration arises, it must be observed that Directive 92/100 is not the only instrument in the field of intellectual property and that, regard being had for the requirements deriving from the unity and coherence of the legal order of the European Union, that concept of remuneration must be interpreted in the light of the rules and principles established by all of the directives on intellectual property, as interpreted by the Court (para. 27).

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See Malenovský, 2012. Ibid. See L. Bently, ‘Harmonization by stealth: The role of the ECJ’, 2012. See Goldstein and Hugenholtz, 2010, 6; G. Davies, ‘The convergence of copyright and authors’ rights – Reality or Chimera’, (1995) IIC, 964; Strowel, A. ‘Convergences entre droit d’auteur et copyright dans la société de l’information’, 1998, 59.

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still influence the making and practice of copyright law; this will also have an impact on the way provisions on limitations will be justified and interpreted. We have seen that the choice of an optional exhaustive list as part of a Directive does represent a 11.99 compromise: it leaves it up to Member States to implement those provisions which best suit their needs, in the way that best fits their respective legal tradition. First, Article 5(3)(o), the ‘grandfather clause’ (see supra), allows Member States, under a number of conditions, to maintain certain exceptions that already existed before the coming into force of the Directive. In practice, however, because of the conditions of application of the provision and the three-step test, few exceptions in national laws might be exempted.209 Second, Article 5(4) allows Member States to extend (‘provide similarly’ for) exceptions granted to the right of reproduction to the right of distribution, to the extent that this is justified by the purpose. This provision appears to broaden Member States’ leeway to introduce new exceptions; however, according to some commentators, a closer look reveals that such an extension might in practice often be impossible or pointless.210 Third, the open wording of Article 5 gives leeway to national courts when they interpret their law in the light of the Directive. Hugenholtz and Senftleben convincingly demonstrated that, to a certain extent, the scope of protection granted by copyright may be redefined by means of interpretation.211 Apart from the above-mentioned three-step test, a number of openly formulated, undefined notions and expressions in the text of Article 5 may provide national courts with flexibility.212 To name but some examples, reproductions may be permitted for non-commercial private use ‘on any medium’ (Art. 5(2)(b)); uses for ‘non-commercial’ scientific research and illustrations for teaching may be permitted, provided that the source is indicated (Art. 5(3)(a)).213 Unless such ‘open notions’ are defined by the CJEU, they thus leave some discretion to the Member States’ judges. Yet, it has been advocated that to ensure some coherency in the application of EU law, judges should take into consideration how provisions have been interpreted in other national jurisdictions.214 In that way, national decisions interpreting a specific exception in a broad manner or extending it to new uses could serve as an example for courts in other Member States. ii.

Adaptation to new challenges in the digital environment – redefining exempted uses and uses consented to

Interpretation may also play an important role when it comes to deciding whether the exclusive 11.100 right should apply to new uses, i.e. uses that were not an issue or not practically possible at the time the Directive was adopted. A lot of those uses are related to the online environment and search engines. One example of such judge-made solutions is the so-called doctrine of implied licence. In the 2010 German case Vorschaubilder I,215 the Federal Court of Justice ruled that the use of an image as a thumbnail without permission of the author did not constitute copyright infringement where the latter had not taken any measures to prevent such use. While rejecting the applicability of any of the limitations invoked, the German Court thus allowed the use of the protected material as

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See von Lewinski, 2010, at 11.5.73. Ibid., at 11.5.74. Exceptions to the reproduction right which might legitimately be extended to the right to distribution are, for instance, the ones listed in Art. 5(3)(a), (b), (c), (f), (h), or (d). Hugenholtz and Senftleben analysed, among other things, how far the current EU and international legal framework leaves Member States space to adopt open limitations and exceptions, using the example of the American ‘fair use’ model (2011). Gotzen had pointed out that ‘the rather vague wording at times of a number of these permitted exceptions is not very conducive from the outset to a true ‘harmonisation’ in this sector’. Gotzen, 15. See Hugenholtz and Senftleben, 14. They furthermore refer to the open notions of ‘specific acts of reproduction’ (Art. 5(2)(c)), the ‘informatory purpose’ of press articles which will justify use for the reporting of current events (Art. 5(3)(c) and (f)), the term of ‘fair practice’ in relation to quotations (Art. 5(3)(d)), or the purposes of ‘caricature, parody or pastiche’ (Art. 5(3)(k)). Murray, 40. Bundesgerichtshof, I ZR 69/08 Vorschaubilder, 29 April 2010.

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consented to by the author.216 In Vorschaubilder II,217 the Federal Court extended its permissive attitude to images which had been made available online without authorisation of the right holder. In this case, no implied consent due to lack of preventive measures was found; however, the consent given by the right holder to any third party to make the image in question available online was considered a sufficient justification for Google to use such an image as a thumbnail. 11.101 Indeed, the solution of assuming an implied licence has been applied in several Member States in the context of linking. Recital 30 of the Directive states that exclusive rights ‘may be transferred, assigned or subject to the granting of contractual licences, without prejudice to the relevant national legislation on copyright and related rights’. Copyright contract law not being harmonised, the conception of an implied licence will thus depend on the respective national law relating to assignments and waivers.218 The CJEU addressed the question of linking in Svensson and Others,219 upholding that the provision of clickable links does not amount to an act of communication to the public insofar as a ‘new public’ has not been reached, namely a public that was not taken into account by the copyright holders when they authorised the initial communication to the public. This was upheld in other cases of the Court of Justice, too.220 It has been argued that the ‘new public’ requirement as developed in Svensson reflected an implied licence argument (with some scholars accepting that it introduced a ‘waiver erga omnes (or at least, as to all members of the intended public)’, having an equivalent effect to the exhaustion of rights.221 11.102 It has been suggested that such national jurisprudential constructions, looking for solutions in general civil and contract law, should lead to changes at the legislative level; the idea being that uses of images such as thumbnails be covered by an exception or limitation.222 It has been pointed out

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As Westkamp explains, such consent does not amount to authorisation: it does not confer rights on third parties, but creates a defence (in addition to the exceptions and limitations listed in Art. 5). See Westkamp, 2013. Bundesgerichtshof, I ZR 140/10 Vorschaubilder II, 19 October 2011. For a commentary, see C. Fahl, ‘BGH: Vorschaubilder II’ (2012) MMR-Aktuell who criticises that the making available of the image, which constitutes an exclusive right of the author, should not have been considered as an authorisation if realised by a third party. In addition, the relevant provision of German law would not allow the right holder to give an authorisation which includes images on other websites. See T. Pihlajarinne, ‘Setting the limits for the implied license in copyright and linking discourse – The European perspective’ (2012) IIC, 706 et seq. Case C-466/12 Nils Svensson, Sten Sjögren, Madelaine Sahlman, Pia Gadd v Retreiver Sverige AB[2014] EUECJ C-466/12. For a commentary see Bently et al. ‘The reference to the CJEU in Case C-466/12 Svensson ’, 2013. See e.g. Case C-279/13 C More Entertainment v Linus Sandberg [2015] EUECJ C-279/13; Case C-348/13 BestWater International GmbH v Michael Mebes, Stefan Potsch [2014] EUECJ C-348/13. On the exhaustion argument see: Association Littéraire et Artistique Internationale (ALAI), ‘Opinion on the Criterion “New Public”, Developed by the Court of Justice of the European Union (CJEU), Put in the Context of Making Available and Communication to the Public’, 17 September 2014, available at http://www.alai.org/en/assets/files/ resolutions/2014-opinion-new-public.pdf, 15–16; M.J. Ficsor, ‘Svensson: Honest Attempt at Establishing Due Balance Concerning the Use of Hyperlinks – Spoiled by the Erroneous “New Public” Theory’, 2015, available online at http://www.copyrightseesaw.net, at 1.2.3. On the implied licence argument see: S. Karapapa, ‘The requirement for a “new public” in EU copyright law’ (2017) European Law Review, 1, 63–81. A. Wiebe, ‘Vertrauensschutz und geistiges Eigentum am Beispiel der Suchmaschinen’ (2011) GRUR 888. explains that the (politically difficult) introduction of a fair use clause into the EU regime of limitations might be one option (see infra). In Kelly v Arriba Soft Corp, 336 F. 3d 811 (2003), the 9th circuit allowed the use of images as thumbnails as being a transformative use. Another option would be to add a specific exception to the closed catalogue. Focus on a balance of interests is crucial to foster the understanding of copyright as a veritable right to communication. See Wiebe, 893 et seq. Aforementioned proposals for a balanced reading of the three-step test could also lead to the desired result, as thumbnails are usually unlikely to unreasonably harm the interests of the right holder. Use of a ‘robots.txt’-file to prevent use of an image could be considered a reasonable, proportionate requirement. M. Leistner, ‘The German Federal Supreme Court’s judgment on Google’s Image Search – a topical example of the “limitations” of the European approach to exceptions and limitation’ (2011) IIC, 42(4) points out that the search engine service and the copyright holder act on different markets; the former does not aim at exploiting the image commercially, and the latter rather profits from the additional traffic generated to his website. As to legislative amendments adapting the current framework to new uses in

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that a balance of interests of the right holder, the user, and the general public223 is primordial in this context. Notably the issue of combining such uses with a remuneration claim might need to be discussed.224 Professor Hargreaves recommended that the UK, apart from extending its portfolio of exceptions within the possibilities offered by Article 5 (see supra), explores, with its EU partners ‘a new mechanism in copyright law to create a built-in adaptability to future technologies which, by definition, cannot be foreseen in precise detail by today’s policy makers’.225 He advocates the: introduction of an exception allowing uses of a work enabled by technology which do not directly trade on the underlying creative and expressive purpose of the work […]. The idea is to encompass the uses of copyright works where copying is really only carried out as part of the way the technology works.

Such uses ‘do not compete with the normal exploitation of the work itself’ but ‘may facilitate it’.226 Such a mechanism has neither been introduced during the 2014 copyright reform in the UK nor through the Digital Single Market Directive (Directive 2019/790), however.

IV. POSSIBLE REVISION OF ARTICLE 5 1. Willingness to reform the EU system of limitations to copyright law Calls for change of the EU legal framework of exceptions and limitations to copyright law have 11.103 been numerous.227 Indeed, the European Commission itself recognised the limits of Article 5. In its 2008 Green Paper on copyright in the knowledge economy,228 the Commission highlighted the pre-eminent role of certain exceptions and limitations in the dissemination of knowledge. It also noted that the phrasing of Member States’ exceptions or limitations is often narrower as compared to the text of the Directive; in this public consultation aimed at stakeholders, the Commission asked whether certain categories of exceptions should be made mandatory. The Green Paper also emphasised the option of contractual arrangements between right holders and users for the implementation of copyright exceptions, and relating to other aspects not covered by copyright exceptions.229 In a 2009 Reflection Document, the Commission’s services stated that: a rather more nuanced approach to exceptions and limitations might be in order in the medium term. There are ‘public interest’ exceptions for research and teaching or for access to works in favour of persons with a disability on the one hand, and there are the ‘consumer’ exceptions, such as private copying, on the other hand. […] Future policy should make a clear distinction and proposals should clearly state which exceptions should be harmonised and made mandatory in scope as a matter of priority and the precise goals pursued in doing so.230

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the online environment, Leistner prefers a ‘careful “opening” of the catalogue of exceptions at European level’. See Leistner, 418, 441. In this context, the importance of search engines for the functioning of the internet is regularly stressed. See Leistner, 2011, 431. Hargreaves at 5.23, 47. Ibid, 5.24, 47. For instance, Janssens, 2009; Geiger, 2010c, ‘The future of copyright in Europe: Striking a fair balance between protection and access to information’; Hugenholtz, 2013; Hilty and Geiger, 2007. Green Paper from the European Commission on Copyright in the Knowledge Economy, COM(2008) 466 final, Brussels, 16 July 2008. For a commentary see, for instance, Geiger et al., 2009, 412; Hilty et al., 2009, 309. In October 2009, the Commission issued a Communication in order to provide an overview of the outcome of the public consultation and announced a number of planned actions; Communication from the Commission on Copyright in the Knowledge Economy, COM(2009) 532 final, Brussels, 19 October 2009. See Geiger and Schönherr, 157 et seq. Creative Content in a European Digital Single Market: Challenges for the Future, Reflection Document of DG INFSO and MARKT of the European Commission, 22 October 2009, 15. For a differentiated approach see also Geiger, 2010c, 14, recommending identifying ‘the exceptions and limitations essential for freedom of expression and

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11.104 In its Communication of 24 May 2011, the Commission evoked the possibility of creating a European Copyright Code to allow for a ‘comprehensive codification of the present body of EU copyright directives in order to harmonise and consolidate the entitlements provided by copyright and related rights at EU level’.231 The Commission took the view that ‘a Code could […] help to clarify the relationship between the various exclusive rights enjoyed by rightsholders and the scope of the exceptions and limitations to those rights’.232 An orientation debate (28 November 2012) reiterated the need to modernise the copyright system: ‘[a] revision of the framework must be based on a comprehensive economic and legal analysis, taking into account impacts on the value chain [consisting of content, content providers, Internet service providers, and end-users]’.233 One of the elements to be addressed was ‘the extent to which the current level of harmonisation as well as the scope of the limitations and exceptions to copyright are appropriate for the digital age, given that they [are] implemented to varying degrees in the Member States’.234 In its follow-up Communication of 18 December 2012,235 the Commission acknowledged that ‘good progress has been made in delivering the copyright-related actions identified in the Digital Agenda236 and the Intellectual Property Strategy [but that] there remains work to be done to ensure an effective single market in the area of copyright’.237 The Commission proposed to work on ‘two parallel tracks of action. On the one hand, it will complete its on-going effort to review and to modernise the EU copyright legislative framework. In parallel, [it] will set out to address a number of issues on which rapid progress is necessary and possible’.238 As to the short-term objectives, the initiative ‘Licences for Europe’ chose the approach of a stakeholder dialogue and addressed, amongst other things, the issues of user-generated content and licensing for small-scale users of protected materials, and text and data mining.239 As to a general review of limitations and exceptions to copyright law, the Commission announced it would ‘complete its on-going review of the EU copyright framework, based on market studies and impact assessment and legal drafting work, with a view to a decision in 2014 whether to table the resulting legislative reform proposals’.240 In December 2013, it launched

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information in a democratic society and ensure that these are fully effective. In contrast, identify the exceptions and limitations which are merely incidental to this objective and propose a differentiated approach’. Commission Communication on a Single Market for Intellectual Property Rights, Boosting creativity and innovation to provide economic growth, high quality jobs and first class products and services in Europe, COM(2011)0287 final, 11. Ibid. Orientation debate on content in the Digital Economy, Secretary General of the European Commission, addressed to the members of the Commission and the Director-Generals and head of units (chefs de service), SEC(2012) 680, 28 November 2012, 4. Ibid. Other specific issues to be addressed in the short term are user-generated content, text and data mining, the issue of private copying levies, and exceptions to exclusive rights in relation to cultural heritage institutions. Communication from the Commission on content in the Digital Single Market, COM(2012) 789 final, Brussels, 18 December 2012. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, A Digital Agenda for Europe, COM(2010)245 final, Brussels, 19 May 2010. Communication from the Commission on content in the Digital Single Market, COM(2012) 789 final, Brussels, 18 December 2012, 2. Ibid., 2–3. At the end of 2013, stakeholders made a number of pledges in order to address practical problems. See ‘Licences for Europe: industry pledges solutions to make more content available in the Digital Single Market’ IP/13/1072 of 13 November 2013. Ibid., 5. In accordance with Art. 12 of the Directive, reports on the application of the Directive should regularly be submitted to the Commission; in particular, the application of Arts 5 and 6 to be examined in the light of the development of the digital market. ‘Where necessary, in particular to ensure the functioning of the internal market pursuant to Article 14 of the Treaty, it shall submit proposals for amendments to this Directive.’ There has, indeed, been an increased call for empirical studies prior to any further harmonising action or legislative amendment in the field of exceptions and limitations to copyright. See, to this end, Hudson, 2011, calling for a change of paradigm and concluding that it ‘is only through use of both doctrinal and empirical techniques that accurate assessments can be made regarding the scope and utilisation of existing exceptions, whether there are any issues in their operation, and the efficacy of proposed solutions’ (270).

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a public consultation on the review of EU copyright law, including an important section on copyright limitations.241 The result of these initiatives was the launch of the Digital Single Market Directive (Directive 2019/790), which introduced a number of new copyright exceptions and limitations, such as text and data mining, and ensured that copyright exceptions and limitations will be mandatory against contractual restriction. Even though this Directive did not result in the introduction of a European Copyright Code, it enhanced the breadth of available exceptions and limitations.

2. A transparent framework capable of coping with future developments A. Setting the framework: education, information and expression as guiding objectives A logical consequence of the criticism of Article 5’s mainly optional nature is the call for – at least 11.105 some – mandatory exceptions.242 As mentioned above, the Commission already makes the distinction between ‘public interest’ and ‘consumer’ exceptions.243 One example implementing the idea of limitations categorised according to their purpose is the Wittem group’s draft of a European Copyright Code (‘the Code’).244 Chapter 5 of the Code on limitations defines four different categories of uses: uses with minimal economic significance; uses for the purpose of freedom of expression and information; uses permitted to promote social, political and cultural objectives; and uses for the purpose of enhancing competition.245 Article 5(2)–(4) moreover, distinguishes free uses from uses for which remuneration is due.246 With regard to remuneration, reference to collective management of rights or to individual negotiation is often made. A parallel could be drawn with proposals for minimum mandatory limitations at the international level.247 Both at the international and EU level, exceptions for libraries and archives, including the issues of digitisation and orphan 241

242 243 244

245

European Commission ‘Public Consultation on the review of the EU copyright rules’ (from 5 December 2013 to 5 March 2014, available at http://ec.europa.eu/internal_market/consultations/2013/copyright-rules/docs/consultationdocument_en.pdf). See Geiger, 2013a, ‘Effectivité et flexibilité: deux impératifs de l’adaptation du droit des “exceptions’”, with further references. Creative Content in a European Digital Single Market: Challenges for the Future, Reflection Document of DG INFSO and MARKT of the European Commission, 22 October 2009, 15, see supra. The ‘European Copyright Code’, released on 26 April 2010, can be found at: www.copyrightcode.eu. A version was published in the European Intellectual Property Review (EIPR) 2011, 76. For commentaries, see, among others, J.C. Ginsburg, ‘European copyright code – Back to first principles (with some additional detail)’, 2011; E. Rosati, ‘The Wittem Group and the European Copyright Code’, 2010; R. Kuhlen, ‘Richtungsweisend oder eine nur begrenzt wahrgenommene Chance? Der Copyright-Code des Wittem-Projekts’ 2011; L. Belder, L.E. Dijkman and A.E.M. Mombers, ‘The age of copyright: Wittem’s copyright reform proposal compared to Samuelson’s Preliminary Thoughts’, 2011. Article 5(1)–(4) of the Code. Besides, the chapter contains a provision on further limitations (see infra), on the relation of limitations with moral rights, on the amount and collection of remuneration, and on the relation between limitations and technical protection measures. Chapter 5’s temerity has been praised for: […] displaying an impetus to break through the rigidity of the current EU and national systems of copyright exceptions in order to favour EU-wide uses of copyrighted works in which, in the drafters’ perception, the interests of third parties, including the public, outweigh those of the authors or copyright owners (Ginsburg, 2011, 2).

246

247

In the drafters’ view, the chapter on limitations is the most expansive one, which differs most from the EU copyright law acquis (Dreier, 2013, 305). In the drafters’ view, the public has a strong interest in accessing certain works; at the same time, the author has, in some instances, a greater interest in receiving compensation for third parties’ use than in preventing such use. See Dreier, 2013, 306. See, for instance, the Proposal of the African Group for a Draft WIPO Treaty on Exceptions and Limitations for the Persons with Disabilities, Educational and Research Institutions, Libraries and Archives, SCCR/22/12, Geneva, 15–24 June 2011. In a 2006 study within the framework of the UNCTAD/ICTSD Project on Intellectual Property Rights and Sustainable Development, Okediji identified ten exceptions which should be accorded international status. Insisting on the ‘critical strategic value’ of enhancing the international legal framework in exceptions and limitations, she highlights the important role of international law for shaping intellectual property law. See R. Okediji, ‘The international copyright system: Limitations, exceptions and public interest considerations for developing countries, 22–23; B. Hugenholtz and R. Okediji, ‘Conceiving an international instrument on limitations and exceptions to copyright’, 2008.

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works, the dissemination of works for teaching and research, and exceptions and limitations for the benefit of persons with a disability are considered crucial,248 not least because they are justified by the fundamental rights of equal access to education, culture, information and communication. Whether any remuneration is due for such use of a work protected by copyright is often left to Member States to decide. At the EU level, amended versions of the limitations relating to libraries, teaching and scientific research could thus be declared mandatory. In Laserdisken, the Court held that ‘the right to education, which the Community legislature must take into account in its action, ha[s] been fully taken into consideration by the Community institutions in the drafting and adoption of Directive 2001/29’.249 Yet, modern teaching methods, taking advantage of digital networks, should not be hindered by too narrowly phrased limitations.250 Respect of the right to attribution and fair compensation should be a sufficient guarantee for balancing the different interests at stake. The amount of compensation, as well as the criteria of non-commerciality of the relevant institutions251 might be better regulated at Member State level. 11.106 Several exceptions listed in Article 5 are justified by the higher ranking goals of access to information and freedom of expression.252 Regarding quotations, the CJEU clarified in Painer that ‘Article 5(3)(d) […] is intended to strike a fair balance between the right to freedom of expression of users of a work or other protected subject-matter and the reproduction right conferred on authors.’253 That fair balance is struck, in this case, by favouring the exercise of the users’ right to freedom of expression over the interest of the author in being able to prevent the reproduction of extracts from his work which has already been lawfully made available to the public, whilst ensuring that the author has the right, in principle, to have his name indicated.254

248 249 250

251

252 253 254

As highlighted, at the EU level, by the Green Paper from the European Commission on Copyright in the Knowledge Economy, COM(2008) 466 final, Brussels, 16 July 2008. Case C-479/04 Laserdisken ApS v Kulturministeriet [2006] ECR I-8089, para. 80. A recent report concluded that the current Art. 5(3)(n) does not allow for the introduction of a copyright exception for online e-lending for public libraries; the wording of the provision referring to making available via terminals. E-book lending therefore needs to be covered by agreements with authors and other right holders. The report welcomes such contractual solutions and encourages the role of CMOs and possibly of extended collective licensing. See van der Noll, K. Breemen, V. Breemen, Hugenholtz, Brom, Poort, ‘Online uitlenen van e-books door bibliotheken, Verkenning juridische mogelijkheden en economische effecten’, Amsterdam, November 2012, available at http://www.ivir.nl/ publicaties/poort/Online_uitlenen_van_e-books.pdf (accessed on 5 March 2012). An English commentary was published by two of the authors, Breemen and Breemen at http://kluwercopyrightblog.com/2013/03/04/can-e-lendingland-itself-a-spot-under-the-public-lending-right/ (accessed on 5 March 2012). In Case C-117/13 Technische Universität Darmstadt [2014] EUECJ C-117/13, the CJEU addressed the question of whether Art. 5(3)(n) allows establishments to digitise works contained in their collections in order to make them available on terminals, and whether national laws may allow users to store on USB sticks works made available on terminals (C-117/13 Technische Universität Darmstadt, lodged on 14 March 2013). The CJEU held that Art. 5(3)(n), read in conjunction with Art. 5(2)(c) of the Information Society Directive does not preclude Member States from providing publicly accessible libraries with the right to digitise the works contained in their collections, if such act of reproduction is necessary for the purpose of making those works available to users through dedicated terminals. In addition, the CJEU held that Art. 5(3)(n) does not cover acts such as the printing out of works on paper or their storage on a USB stick, carried out by users from dedicated terminals installed in publicly accessible libraries. However, national law may allow such acts on the basis of Art. 5(2)(a) or (b) of the Information Society Directive on condition that the requirements laid down by those provisions are met. Recital 42 already provides some useful guidance in this respect, stating that the ‘non-commercial nature of the activity in question should be determined by that activity as such. The organisational structure and the means of funding of the establishment concerned are not the decisive factors […]’. Namely, Art. 5(3)(c) and (f) enhancing access to information, and Art. 5(3)(d) and (h) allowing for freedom of expression properly speaking. Case C-145/10 Eva-Maria Painer v Standard VerlagsGmbH and Others [2011] EUECJ C-145/10, para. 134. Painer, para. 135. In this vein, the UK Government recently announced that it would introduce: a more general permission for quotation of copyright works for any purpose, as long as the use of a particular quotation is ‘fair dealing’ and its source is acknowledged. Minor uses of copyright materials, such as references and

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It should be noted that in certain cases, quotation of undisclosed works might be necessary for the sake of freedom of expression or information; it could be justified by Article 10 ECHR, even if it might be considered contra legem in certain cases.255 The general rule, however, as developed in Case C-516/17 Spiegel Online [2019] EUECJ C-516/17, is that: the exception for quotations applies only if the quotation in question relates to a work which has already been lawfully made available to the public. That is the case where the work, in its specific form, was previously made available to the public with the rightholder’s authorisation or in accordance with a non-contractual licence or statutory authorisation.

An important aspect in the debate about mandatory limitations is the relation between the latter 11.107 and copyright contracts, which has not been regulated by the Directive.256, 257 Recital 45 states that limitations should not ‘prevent the definition of contractual relations designed to ensure fair compensation for the rightholders insofar as permitted by national law’. Recital 51 adds that, ‘Member States should promote voluntary measures taken by rightholders, including the conclusion and implementation of agreements between rightholders and other parties concerned, to accommodate achieving the objectives of certain exceptions or limitations provided for in national law in accordance with this Directive’. The fact that limitations may be overridden by contract has been subject to criticism. At first sight, the Directive’s wording appears to indicate that focus is put on the effect of limitations and on adequate remuneration (see infra). Yet, it is being argued that due to the contracting parties’ different levels of bargaining power, contracts often do not lead to a fair balance of interests.258 Consequently, at least some limitations should be made mandatory by the EU legislator.259

B. A clear legal framework for the accommodation of unknown new uses Article 5’s optional nature thus calls for reform. At the same time, the exhaustive nature of the list of 11.108 limitations is being questioned. Discussion has concentrated, on the one hand, on increasing uniformity of rights and limitations across the EU; on the other hand, numerous proposals to increase flexibility of the closed list system have been put forward (see supra). A popular topic is the debate about whether a flexible fair use clause inspired by the US copyright system could be introduced to the EU system of limitations.260 Yet, opinions diverge on the desirability and

citations in academic papers, quotation as part of educational activities and short quotations on internet blogs or in tweets, will therefore be permitted as long as they are fair. Photographs will continue to be excluded from news reporting provisions, as they are at present. (Modernising Copyright: A modern, robust and flexible framework, 2012, 4; 26.)

255 256 257

258 259

260

Moreover, the introduction of limited copying on the basis of fair dealing for parody, caricature and pastiche is planned, which should leave the existing moral rights regime unchanged. See at 31. See the wording of Art. 10(1) of the Berne Convention: ‘It shall be permissible to make quotations from a work which has already been lawfully made available to the public […].’ See von Lewinski, 2010, at 11.5.80. Art. 6(4) relating to technical protection measures states that the exercise of certain exceptions does not have to be guaranteed with regard ‘to works or other subject-matter made available to the public on agreed contractual terms in such a way that members of the public may access them from a place and at a time individually chosen by them’ (see infra). See Guibault, 2010, 58–9. See also Hargreaves, 2011, 51, who adds that a legal rule provides for more clarity than a landscape of diverse contracts and licences. Another parallel with debates at the international level can be drawn; Art. 19 of the Proposal of the African Group for a Draft WIPO Treaty on Exceptions and Limitations for the Persons with Disabilities, Educational and Research Institutions, Libraries and Archives (see supra), reads as follows: ‘Any contractual provisions which provide exemptions from the application of the limitations and exceptions listed in Article 2 shall be null and void.’ See, for instance, J. Griffiths, ‘Unsticking the centre-piece – the liberation of European copyright law?’ 2010; M. Senftleben, 2010b, ‘Bridging the differences between copyright’s legal traditions – The emerging fair use doctrine’. The same author has also looked at whether the EU three-step test could function as an EU fair-use clause, see supra.

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feasibility of transposing what has been called the ‘fair use panacea’261 to EU law.262 Counter arguments are a lack of legal certainty, proliferation of costly litigation, or the fact that the shape of IP law is not exclusively responsible for the US creative industry’s success.263 It has, on the other hand, been argued that civil law judges have long-standing experience in interpreting open notions of, e.g. certain civil codes. This exercise has helped adapt rules to changing contexts and paradigms.264 Article 5(5) of the European Copyright Code265 provides an example of an opening clause that allows the introduction of new limitations under certain conditions. While striving for a compromise between the common law and the civil law approach,266 the drafters did not follow the US fair use model based on abstract, non-specific criteria. On the contrary, a positive reading of the three-step test should allow for the test’s criteria to define the outer limits of permissible limitations.267 Recent amendments of the Korean Copyright Act give an example of how the fair use and the closed-list approach have been reconciled on the basis of the three-step test: as a general guideline, the first paragraph of the new provision states that non-enumerated uses of works may be permitted as long as the second and third steps are fulfilled. A second paragraph then adds, along the lines of the US fair use provision, four statutory factors to be taken into account when assessing the lawfulness of the use.268

261 262

263 264 265

See Hudson, who cautions against the idea of a tailor-made one-size-fits-all solution; she calls for a combination of doctrinal and empirical considerations, and of a contextual approach, 269–71. Leistner, for instance, objects that the CJEU would not be in a position to offer sufficient guidance, as it lacks a clear methodology; the preliminary ruling procedure does not appear apt for the purpose and would lead to a case overload. Leistner, 2011, 437. See Hargreaves, 2011, 44–6. See Senftleben, 2014, 9 et seq. The draft provision, entitled ‘Further limitations’, reads as follows: Any other use that is comparable to the uses enumerated […] is permitted provided that the corresponding requirements of the relevant limitation are met and the use does not conflict with the normal exploitation of the work and does not unreasonably prejudice the legitimate interests of the author or rightholder, taking account of the legitimate interests of third parties.

266 267

268

See in this sense Fn. 48 of the Code. See R. Hilty, ‘Declaration on the three-step test: Where do we go from here?’, 2010, 83–4. See also the aforementioned ‘Declaration on a balanced interpretation of the three-step-test’, supra. Ideally, the three-step test in the proposed version should be understood to be directed at both legislatures and court. See also in this sense M. Senftleben, ‘Comparative approaches to fair use: An important impulse for reforms in EU copyright law’, in G.B. Dinwoodie (ed.), Methods and Perspectives in Intellectual Property, 2014, who proposes to read the broadly worded ‘prototype’ exceptions of Art. 5 as a ‘semi-open norm’ in combination with the open criteria of the three-step test (notably the second and third steps). In order to allow judges to introduce new exceptions the legislative framework would, however, have to be revised; See Geiger, 2008a; 2013a. Article 35(3) of the Korean Copyright Act (Fair Use of Copyrighted Material) reads as follows: 1.

2.

Except for situations enumerated in art. 23 to art. 35-2 and in art. 101-3 to 101-5, provided it does not conflict with a normal exploitation of copyrighted work and does not unreasonably prejudice the legitimate interest of the copyright holder, the copyrighted work may be used, among other things, for reporting, criticism, education, and research. In determining whether art. 35-3(1) above applies to a use of copyrighted work, the following factors must be considered: the purpose and character of the use, including whether such use is of a commercial nature or is of a nonprofit nature; the type or purpose of the copyrighted work; the amount and importance of the portion used in relation to the copyrighted work as a whole; the effect of the use of the copyrighted work upon the current market or the current value of the copyrighted work or on the potential market or the potential value of the copyrighted work.

According to Cho, ‘Newly Implemented Korean Fair Use and the Three Step Test’, 28 February 2013, found at http://infojustice.org/archives/28766#more-28766 on 5 March 2013. In Ireland, the Report of the Copyright Review Committee ‘Modernising Copyright’ (Dublin, 2013) recommends the introduction of a fair use exception which differs substantially from the US doctrine: in order for it to apply, existing exceptions must be exhausted; up to eight separate factors may be applied to determine if a use is fair (11, 89 et seq.)

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3. Relation to Technical Protection Measures (TPMs) and Article 6(4) of the Directive At the time of the adoption of the Directive, one of the crucial issues to be addressed was the 11.109 protection against circumvention of technical protection measures. Article 6 of the Directive finally implemented Articles 11 of the WCT and 18 of the WPPT, thus offering a ‘third layer of protection’ to right holders.269 As a consequence, the enforcement of certain limitations and exceptions, and therefore the balance of interests guaranteed by the legislator, was, in theory, endangered.270 Article 6(4) was thought to re-establish that balance; its first paragraph states that: […] in the absence of voluntary measures taken by rightholders, including agreements between rightholders and other parties concerned, Member States shall take appropriate measures to ensure that rightholders make available to the beneficiary of an exception or limitation provided for in national law in accordance with Article 5(2)(a), (2)(c), (2)(d), (2)(e), (3)(a), (3)(b) or (3)(e) the means of benefiting from that exception or limitation, to the extent necessary to benefit from that exception or limitation and where that beneficiary has legal access to the protected work or subject-matter concerned.

This solution has been criticised as unsatisfactory for various reasons.271 First, the clear preference given to contractual agreements has enhanced the impression of increasing ‘privatisation’ of copyright law. In response to such a tendency it has been argued that exceptions, which define the limits of the exclusive right, should be non-negotiable; all the more since right holders usually have more bargaining power.272 Incidentally, Member States have, in cases where voluntary measures are absent, provided for different mechanisms of enforcement, e.g. judicial or administrative procedures or mediation systems.273 All of them do, however, appear to impose a non-proportional burden on the lawful user, and are likely to have a deterring effect.274

269 270

See von Lewinski, 2010, at 11.6.2. See, more detailed, Geiger, 2008c, ‘The answer to the machine should not be the machine, safeguarding the private copy exception in the digital environment’, EIPR 121. In her conclusions in Nintendo, AG Sharpston held that in order to determine if a TPM is protected or not according to Article 6 of the Directive, the principle of proportionality needs to apply; it especially needs to be considered whether the technical measure has the effect of preventing or restricting not only acts which require the right holder’s authorisation but also acts which do not require such authorisation. Case C-355/12 Nintendo Co Ltd and Others v PC Box Srl and 9Net Srl, Opinion of Advocate General Sharpston delivered on 19 September 2013, para. 79. In this relation the Court held that: the concept of an ‘effective technological measure’, for the purposes of Article 6(3) …, is capable of covering technological measures comprising, principally, equipping not only the housing system containing the protected work, such as the videogame, with a recognition device in order to protect it against acts not authorised by the holder of any copyright, but also portable equipment or consoles intended to ensure access to those games and their use.

271

272

273

274

See Case C-355/12 Nintendo Co Ltd and Others v PC Box Srl and 9Net Srl [2014] EUECJ C-355/12. An empirical study on the ability of users to take advantage of certain statutory exceptions to copyright in the UK reached interesting results: certain allowed uses, including ‘privileged exceptions’ are adversely affected; often, beneficiaries do not use the UK complaints mechanism in order to access the work; often, intervention of regulatory bodies is necessary before content owners act. See P. Akester, ‘The impact of digital rights management on freedom of expression – The first empirical assessment’ (2010) IIC, 38. See, for instance, S. Dusollier, ‘Exceptions and technological measures in the European Copyright Directive of 2001 – An empty promise’, 2003, 61, 62. It is often held that the WIPO Treaties, in adopting a right holder friendly approach, reflect lobbying efforts of the US cultural industry. See C.P. Rigamonti, ‘Schutz gegen Umgehung technischer Maßnahmen im Urheberrecht aus internationaler und rechtsvergleichender Perspektive’ 2005, 2 et seq.; Hilty, 2005. Rigamonti highlights that even if the WIPO Treaties provide for minimum rights, Articles 11 WCT and 18 WPPT cannot be abused: they should assist the right holder in enforcing his rights, and not in expanding them, and should also protect third parties. Preference always needs to be given to the material copyright law, i.e. the exceptions listed (6). The fact that the user may claim that the necessary means to circumvent the TPM are made available may serve as an argument in favour of the perspective that exceptions actually confer rights and not solely defences/means of defence on users (see Geiger, 2004b, 201). Art. 6(4) does not, however, grant a right to circumvent technical protection. This would constitute infringement. See von Lewinski, 2010, at 11.5.11. Geiger, 2008c, 125.

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11.110 Next, the limitation of the scope of the provision to certain exceptions has been criticised.275 Certain exceptions with a strong justification such as caricature, quotations or pastiche are not covered by the exemption.276 11.111 Another criticism relates to the optional application of the limit to private copying.277 The second paragraph of Article 6(4) states that: a Member State may also take such measures in respect of a beneficiary of an exception or limitation provided for in accordance with Article 5(2)(b), unless reproduction for private use has already been made possible by rightholders to the extent necessary to benefit from the exception or limitation concerned and in accordance with the provisions of Article 5(2)(b) and (5), without preventing rightholders from adopting adequate measures regarding the number of reproductions in accordance with these provisions (emphasis added).

Private use of works, which was traditionally encouraged and privileged by copyright law, can thus, in practice, be controlled by the rightholder.278 It has been argued that private use, which is also justified by privacy and freedom of information, should become one of the ‘privileged exceptions’. The purpose of the exception in question, i.e. the spirit of the law, should be taken into account in order to determine whether a ‘sub-optimal’ use (e.g. the making of a copy at a lower quality or involving extra costs) can be considered as sufficient.279 11.112 Third, the text of Article 6(4) goes on to say that ‘the provisions of the first and second subparagraphs shall not apply to works or other subject-matter made available to the public on agreed contractual terms in such a way that members of the public may access them from a place and at a time individually chosen by them’. The exclusion from the benefit of the provision of on-demand services280 has been perceived as not forward looking with a view to online distribution business models.281 Indeed, it appears that the use of TPMs, in particular in the field of music, is decreasing.282 Yet, in new digital markets such as the one for e-books, TPMs can give the right holder extensive control over the use of the work. The exercise of various exceptions covering, e.g. quotations or certain private uses and format shifting can thereby be prevented.283 TPMs have, in addition, acquired a new meaning as a tool of expressing the right holder’s will to authorise certain uses of the protected work. In the context of the doctrine of implied licences, non-use of TPMs has been interpreted as the author’s consent to third parties’ use of the work (see supra).

275 276 277

See, for instance, S. Dusollier, Droit d’auteur et protection des œuvres dans l’univers numérique, Droits et exceptions à la lumière des dispositifs de verrouillage des œuvres, 2007, 165–8. See Geiger, 2004b, 380–81; S. Karapapa, Private Copying, Routledge research in intellectual property. Routledge, 2012. Recital 39 adds that: When applying the exception or limitation on private copying, Member States should take due account of technological and economic developments, in particular with respect to digital private copying and remuneration schemes, when effective technological protection measures are available. Such exceptions or limitations should not inhibit the use of technological measures or their enforcement against circumvention.

278 279 280

See R. Hilty, ‘L’avenir du droit d’auteur dans le “dilemme numérique”‘, 2005. See V. Samartzi, ‘Optimal vs sub-optimal use of DRM-protected works’ (2011) EIPR, 33(8), 520–21. Recital 53 explains that: The protection of technological measures should ensure a secure environment for the provision of interactive on-demand services, in such a way that members of the public may access works or other subject-matter from a place and at a time individually chosen by them. Where such services are governed by contractual arrangements, the first and second subparagraphs of Article 6(4) should not apply. Non-interactive forms of online use should remain subject to those provisions.

281 282 283

Dusollier, 2003, 61, 62. See von Lewinski, 2010, at 11.6.14. See T-E. Synodinou, ‘E-books, a new page in the history of copyright law?’ (2013), EIPR, 35(4), 225–6.

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4. Relation to moral rights Article 5 lays down limitations to the author’s economic rights.284 In addition, respect of the right of 11.113 attribution is required by a number of exceptions.285 An express mention of the relation between limitations to economic rights and moral rights, as suggested by the Wittem Code,286 appears forward-thinking.287 A possible future reform of limitations might thus be an opportunity to clarify the scope of moral rights when derogating from an economic right: while certain basic nonpecuniary interests of the author should always be respected, they should not lead to abusive hampering of creative uses.

V. FAIR COMPENSATION, REMUNERATION AND THE LINK TO COLLECTIVE MANAGEMENT 1. The notion of ‘fair compensation’ and the right to property Three exceptions listed in Article 5 allow certain uses, provided that the right holders receive fair 11.114 compensation.288 Regarding terminology, ‘fair compensation’ was thought to ‘bridge the gap between such […] Member States having levy systems that provide for “equitable remuneration” and those […] that have so far resisted levies altogether’.289 These differing notions refer, respectively, to justifications of natural justice providing for a general right to remuneration deriving from the exclusive right,290 and to the notion of harm, for which compensation would be due.291 In order to enhance creativity which requires use of protected works, focus on remuneration appears more appropriate. The option of rethinking the concept of exclusivity in copyright law to allow for a veritable limitation-based right to remuneration should receive more attention.292

284

Recital 19 states that: moral rights of rightholders should be exercised according to the legislation of the Member States and the provisions of the Berne Convention for the Protection of Literary and Artistic Works, of the WIPO Copyright Treaty and of the WIPO Performances and Phonograms Treaty. Such moral rights remain outside the scope of this Directive.

285

286 287 288

289

290

291 292

Articles 5(3)(a) (teaching and research), 5(3)(c) (press articles), 5(3)(d) (quotations), and 5(3)(f) (public speeches) ask for a reasonable effort of the user to indicate the source, including the author’s name. It has been suggested that such an obligation may be interpreted as declaratory, since the Berne Convention, which binds the Member States, lays down the moral right to authorship. See von Lewinski, 2010, at 11.5.46. Moral rights are set out in Chapter 3 of the Code. Hugenholtz recently raised the question whether, in a ‘culture of copying’, the trend should be towards a focus in copyright law on the right of attribution, 2012. Article 5(2)(a), (b), and (e). However, Recital 36 adds that ‘Member States may provide for fair compensation for rightholders also when applying the optional provisions on exceptions or limitations which do not require such compensation.’ Bechtold in Dreier and Hugenholtz (eds), 2006, 373. Countries unfamiliar with statutory remuneration rights, like the UK or Ireland, can thus also provide for other forms of compensation. See von Lewinski in von Lewinski and Walter, 2010, 11.5.24. The German Copyright Act, for instance, recognises a comprehensive exclusive right of the author over all existing and future ways of exploitation of his work (Art. 15 of the Copyright Act). Any use, be it in public or in private, justifies a claim to remuneration. Section 6 of the German Copyright Act provides for appropriate remuneration for most exempted uses; art. 63(a) states that such claims to remuneration cannot be waived in advance. The German term ‘Vergütung’, which is also used in the German version of the Directive, refers to remuneration. Bechtold in Dreier and Hugenholtz (eds), 2006, 373. Bechtold points out that an obligation to pay equitable remuneration is stronger than a claim to fair compensation. See Geiger, 2010a, 528; also see on exclusivity and compensation J. Reinbothe, ‘Chapter 11: Private Copy Levies’ in I Stamatoudi (ed.), New Developments in EU and International Copyright Law, Alphen aan den Rijn: Kluwer Law International, 2016, 298.

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11.115 According to the CJEU’s case law, however, the word ‘compensate’ should be understood as referring to a compensation scheme triggered by the existence of harm to the detriment of the right holders. ‘Fair compensation must necessarily be calculated on the basis of the criterion of the harm caused to authors […].’293 In Hewlett-Packard Belgium, the Court was asked to clarify whether a national law prescribing a proportional remunerative payment or a lump-sum remunerative payment not calculated on the basis of harm is compatible with the concept of fair compensation.294 The Court held that the interpretation of the phrase ‘fair compensation’ requires drawing a distinction according to whether the reproduction on paper or a similar medium effected by the use of a photographic technique or similar process is carried out by any user for private use and for ends that are neither directly nor indirectly commercial. 11.116 A right to fair compensation might at times derive from the three-step test. Indeed, the possibility for the test to provide for a remuneration right or a claim to fair compensation – if allowed by the wording of the national provisions or not already prescribed explicitly – was one of the goals of including the test in the Directive.295 In this context, reference to the assessment of fair use in US copyright law may be made: in light of the important economic aspect of use of protected works,296 the criterion of possible harm becomes primordial.297 The Directive itself does not define the notions of fair compensation or possible harm any further. Recital 35 simply states that: when determining the form, detailed arrangements and possible level of such fair compensation, account should be taken of the particular circumstances of each case. When evaluating these circumstances, a valuable criterion would be the possible harm to the rightholders resulting from the act in question. […] In certain situations where the prejudice to the rightholder would be minimal, no obligation for payment may arise.298

11.117 In Case C-463/12 Copydan, the CJEU offered some clarification on the notion of ‘situations where the prejudice to the rightholder would be minimal’, holding that Article 5(2)(b), read in the light of Recital 35, allows Member States to provide for an exemption from the requirement under the private copying exception to pay fair compensation, provided that the prejudice caused to

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See Case C-467/08 Padawan SL v Sociedad General de Autores y Editores de España (SGAE) [2010] ECR I-10055, paras 41–42, relating to the private copying exception. See also Case C-435/12 ACI Adam BV [2014] EUECJ C-435/12, para. 56: Consequently, all the users who purchase such equipment, devices and media are indirectly penalised since, by bearing the burden of the levy which is determined regardless of the lawful or unlawful nature of the source from which such reproductions are made, they inevitably contribute towards the compensation for the harm caused by reproductions for private use made from an unlawful source, which are not permitted by Directive 2001/29, and are thus led to assume an additional, non-negligible cost in order to be able to make the private copies covered by the exception provided for by Article 5(2)(b) of that directive.

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and Opinion of AG Cruz Villalón, delivered on 9 January 2014, who states that the Directive refers to adequate compensation rather than to remuneration (at 41). Case C-572/13 Hewlett-Packard Belgium v Reprobel [2015] EUECJ C-572/13. See von Lewinski, 2010, at 11.5.78. The author cautions, however, against initiatives proposing the replacement of certain exclusive rights by a general right to remuneration, the list of exceptions being exhaustive and laying down maximum exceptions. An example of such models is the French proposal of a ‘licence globale’ which would legalise the non-commercial online exchange of works protected by copyright against payment of a flat rate. More generally on the US fair use provision and the factor test, see S.W. Halpern, C.A. Nard and K.L. Port, Fundamentals of United States Intellectual Property Law: Copyright, Patent, Trademark, 2011. It has been held that limitations to the continental European author’s right could not solely be determined by reference to economic harm, since effective protection needs to be granted to the right holder in any case. See Ullrich, 2009, 285. Harm could, therefore, only be one criterion when evaluating the need for and amount of remuneration. See also von Lewinski in von Lewinski and Walter, 2010, at 11.5.24. The criteria of minimal harm might serve as an argument in the afore-mentioned discussion of protected works in order to enable the proper functioning of search engines. The Wittem group’s text of a European Copyright Code exempts certain uses ‘with minimal economic significance’ as free uses (Art. 5(1) of the Code).

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rightholders in such cases is minimal.299 António Vitorino recommended that the notion of harm be interpreted uniformly across the EU. In addition, he calls for an explainable and clear correlation between the level of levies and the definition of ‘harm’; harm could then be defined as the value consumers attach to additional copies in question (lost profit).300 As pointed out before, intellectual property, including copyright, is now also protected at the 11.118 constitutional level by Article 17(2) of the Charter. Taking into account that the ECHR’s case law relating to Article 1 of Protocol 1 will probably be applicable also in the context of Article 17(2),301 the fair balance test might be of importance when assessing whether an interference with the article is justified. Compensation (or remuneration302), which needs to be proportionate,303 may thereby play a key role. It could thus be argued that the author’s or right holder’s economic right is being respected as long as proportionate remuneration or compensation is provided. When determining the appropriate amount, IP protection’s overall goal, i.e. protecting creators while at the same time incentivising creativity, should serve as a guide.304 With a view to further harmonisation, clarification regarding uses for which remuneration shall be required305 and the determination of the amount appears desirable.

2. An exception justified by practical considerations and privacy protection: private copying and Article 5(2)(b) One of the most important, and at the same time most controversial, exceptions is the one for 11.119 private copying laid down in Article 5(2)(b).306 As to the exception’s justification, it has been held that unlike limitations based on higher ranking considerations such as access to information, the

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Case C-463/12 Copydan Båndkopi v Nokia Danmark A/S [2015] EUECJ C-463/12. On the notion of fair compensation and the relation to technical protection measures, the CJEU held that: The implementation of technological measures under Article 6 of Directive 2001/29 for devices used to reproduce protected works, such as DVDs, CDs, MP3 players and computers, can have no effect on the requirement to pay fair compensation in accordance with the exception to the reproduction right in respect of reproductions made for private use by means of such devices. However, the implementation of such measures may have an effect on the actual level of such compensation.

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Vitorino, 2013, 20. Article 52(3) of the Charter states that the meaning and scope of rights which correspond to rights guaranteed by the Convention shall be the same as of those Convention rights. Yet, Union law may provide for more extensive protection. It is interesting to see that the French and English wording of Recital 35 of the Directive refers to compensation in the context of copyright levies, while the German version of the Directive uses the term ‘remuneration’. See C. Geiger, 2009b, ‘Drafting the appropriate and balanced scope of copyright protection in the European Union – What language can contribute to the debate’, 74. See, for instance, James v United Kingdom (1986) 8 EHRR 123, see Griffiths and McDonagh, 86. The drafters of the Declaration for a balanced interpretation of the three-step test consider the key incentive for creation to be compensation at market rate. However, compensation should be deemed to be sufficient as long as there is incentive to create. Compensation has been recognised to be mandatory for private copying (see Recital 38; C-467/08 Padawan SL v Sociedad General de Autores y Editores de España (SGAE) [2010] EUECJ C-467/08, para. 36). The feasibility of compensation mentioned in Art. 5(2)(a) and (e), read in the light of the three-step test could have been discussed in Case C-351/12 OSA where the referring court asked whether non-mandatory exceptions as well as the three-step test of Art. 5(5) have direct effect, and may be relied upon directly by a collecting society in private litigation. The CJEU did not directly address this issue but held that Art. 3(1) of the Information Society Directive precludes national legislation, which excludes the right of authors to authorise or prohibit the communication of their works, by a spa establishment through the intentional distribution of a signal by means of television or radio sets in the bedrooms of the establishment’s patients. Art. 5(2)(e), (3)(b) and (5) are not such as to affect that interpretation. See Case C-351/12 Ochranný svaz autorský pro práva k dílům hudebním o.s.(OSA) v Lécˇebné lázně Mariánské Lázně a.s. [2014] EUECJ C-351/12. At the Stockholm conference in 1967, which led to the adoption of the three-step test in the Berne Convention, private use was initially inserted as it was considered as particularly important. See Hudson, 22.

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private copying exception is merely justified by reasons of practicability.307 However, it could be argued that the right to privacy and access to information may in some cases legitimate private use.308 Non-interference with individuals’ private life could be considered a basis of the private copying exception. Moreover, access to information, culture, or education can, at times, be enabled by the private copying exception in case none of the more specific exceptions is applicable.309 The exception only applies to the right to reproduction, and under certain conditions: the beneficiary needs to be a natural person; purpose of the use has to be private and neither directly nor indirectly commercial; and right holders need to receive fair compensation.310 The limitation of the exception to acts of reproduction has been criticised as outdated: in digital networks (as opposed to the analogue world), private copying often also implies acts of making available and communication to the public.311 In Case C-265/16 VCAST Ltd v RTI SpA [2017] EUECJ C-265/16, it was held that Article 5(2)(b) does not allow a commercial undertaking to provide private individuals with a cloud service for the remote recording of private copies of works protected by copyright, by means of a computer system, by actively involving itself in the recording, without the right holder’s consent. While ‘fair compensation’ has meanwhile been declared an autonomous concept of Union law (see supra), organisation of mechanisms ensuring compensation and calculation of tariffs still diverge largely among Member States.312 In Amazon, the Court provided some further clarification on the modalities of payment of levies.313

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See, for instance, Vitorino, 20, who refers to ‘the practical difficulty of the licensing of copies made by consumers for their private use’ which makes it ‘fair and reasonable to compensate rightholders precisely for lost income opportunities, e.g. via the license agreements they would have concluded if there were no exception’. See Geiger, 2008c, 122; See Hugenholtz, 1996, 94–5. The detailed private copying provision of the German Copyright Act (Art. 53), for instance, includes, amongst others, certain uses for private study or educative purposes. It has been held that the concept of ‘own use’, broader than ‘private use’ of some national laws will need to be considered under other provisions of Art. 5, such as, for instance, Art. 5(2)(a), (c), or (e). Von Lewinski in von Lewinski and Walter, 2010, at 11.5.31. Recital 38 reiterates that a private copying exception needs to be: accompanied by fair compensation. This may include the introduction or continuation of remuneration schemes to compensate for the prejudice to rightholders. Although differences between those remuneration schemes affect the functioning of the internal market, those differences, with respect to analogue private reproduction, should not have a significant impact on the development of the information society. Digital private copying is likely to be more widespread and have a greater economic impact. Due account should therefore be taken of the differences between digital and analogue private copying and a distinction should be made in certain respects between them.

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Recital 52 refers to contracts and TPMs, emphasising that Member States should keep in mind the goal of ‘achieving the objectives of such exception or limitation’. Special attention was paid to the relation between compensation and TPMs in order to avoid ‘double remuneration through a statutory remuneration system on the one hand and an individual fee paid for uses following the removal of technical protection measures on the other hand’. Von Lewinski in von Lewinski and Walter, 2010, at 11.5.31. In Case C-462/09 Stichting de Thuiskopie v Opus Supplies Deutschland GmbH and Others [2011] EUECJ C-462/09, the Court reiterated the mandatory nature of compensation, highlighting that ‘unless they are to be deprived of all practical effect, those provisions impose on a Member State which has introduced the private copying exception into its national law an obligation to achieve a certain result’ (para. 34). In Case C-277/10 Martin Luksan v Petrus van der Let [2012] EUECJ C-277/10, the CJEU stated that the right to fair compensation could not be waived (para. 100). In VG Wort, the Court stated that ‘[…] the possibility of applying technological measures under Article 6 of Directive 2001/29 cannot render inapplicable the condition relating to fair compensation provided for by Article 5(2)(b) of that directive’, para. 59. See M. Kretschmer, ‘Private copying and fair compensation: An empirical study of copyright levies in Europe’ 2011, 9. He names the examples of file sharing in digital networks, online publication, performance and distribution within networks, and user generated content/mixing/mash-up. The majority of Member States use levy systems, with the exception of the UK, Ireland, Malta, Luxembourg, and Cyprus. Among those 22 States, there are, furthermore, differences relating to the equipment to which levies apply, tariffs, beneficiaries, or regulatory structures. See Kretschmer, 10; also see S. Karapapa, Private Copying, Routledge research in intellectual property, Routledge, 2012. Case C-521/11 Amazon.com International Sales Inc and Others v Austro-Mechana Gesellschaft zur Wahrnehmung mechanisch-musikalischer Urheberrechte Gesellschaft mbH [2013] EUECJ C-521/11. According to the Court, a private copying levy may, under certain conditions, be indiscriminately applied on the first placing on the market of recording media suitable for reproduction. A rebuttable presumption of private use of such media can be admissible; a part of the

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A recent study suggests a de minimis exception where there is no lost sale.314 However, this may no 11.120 longer be supported following the quashing of the private copying exception, which was introduced in UK law during the 2014 copyright reform. The British Academy of Songwriters, Composers and Authors (BASCA), the Musicians’ Union (MU) and UK Music challenged the introduction of the private copying exception, arguing that it was unlawful for failing to provide fair compensation to right holders in line with EU copyright.315 The private copying exception has been subject to review in a number of Member States.316 The question concerning the legality of the source has recently been decided at the EU level.317 In 11.121 his Opinion in ACI Adam BV, AG Cruz Villalón stated that legality of the source should be a condition for the private copying exception to apply. Allowing file-sharing as private copying on the ground that it would be the only feasible way to compensate right holders for their loss was, in the AG’s view, incompatible with the purpose of the exception and with the three-step test.318 Cruz Villalón holds the view that file-sharing cannot be put on a par with the normal exploitation of the works in question; the levy paid could, moreover, not adequately compensate the right holders’ loss suffered from infringement of their various exclusive rights. It remains to be seen if this very restrictive understanding of the scope of the levy system with regard to the private copying exception is confirmed by the Court of Justice. In any case, the AG’s opinion seems to start from the assumption that only exclusive rights can provide for proper remunerations to creators, which is disputable;319 this also leaves mass uses of copyrighted works on peer-to-peer file-sharing sites unremunerated, which is equally unsatisfying.320 The Court of Justice held: ‘that Article 5(2)(b) read in the light of Article 5(5) precludes national legislation, which does not distinguish the

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funds may be paid to social and cultural institutions under certain conditions if they benefit those entitled; and the obligation to pay the levy may not be excluded where a comparable levy has already been paid in another Member State. See Kretschmer, 19. As to the concepts of harm, he criticises the aforementioned notion of lost profit (see supra): first, if there is an exception, there could in theory not be any lost profit (17); second, consumers’ (diverging) willingness to pay will influence the relation between the number of works produced and the number of works consumed. As to the de minimis rule, one question referred by the national court in Copydan Båndkopi relates to the definition of ‘situations where the prejudice to the rightholder would be minimal’. See former s.28B and Schedule 2 (1B) of the UK Copyright, Designs and Patents Act 1988); also see see BASCA v Secretary of State for Business and Innovation [2015] EWHC 1723, and follow-up judgment [2015] EWHC 2041. In Spain, Real Decreto 1657/2012, de 7 de diciembre, por el que se regula el procedimiento de pago de la compensación equitativa por copia privada con cargo a los Presupuestos Generales del Estado abolished the levy due on certain media; instead, a certain amount will be taken from the State Budget, and paid by the government to collecting societies every year. Case C-435/12 ACI Adam BV and Others v Stichting de Thuiskopie and Others [2014] EUECJ C-435/12. Also see some national initiatives preceeding ACI Adam. For instance,the French legislator recently clarified that reproductions made from an illicit source are excluded from the scope of the private copy exception, Law No. 2011–1898 dated 20 December 2011 on the remuneration for private copy, OJ 21 December 2011 at 21546, modifying Art. L. 122–5, 2° of the French Intellectual Property Code. The Wittem Code proposes to include such a requirement (Art. 5(3)(2)(a) of the Code). In Case C-314/12 UPC Telekabel Wien [2014] EUECJ C-314/12, the Austrian court asks, amongst other things, whether ‘[…] reproduction for private use (Article 5(2)(b) of the Information Directive) and transient and incidental reproduction (Article 5(1) of the Information Directive)[is] permissible only if the original of the reproduction was lawfully reproduced, distributed or made available to the public’. AG Cruz Villalón in Case C-435/12 ACI Adam BV, Opinion delivered on 9 January 2014, at 74 et seq. The referring court, Hoge Raad der Nederlanden (Netherlands) had also asked about the possible role of the three-step test and TPM in this context. In Hewlett-Packard Belgium, the Belgian Court asked the CJEU whether a levy which would also compensate for counterfeit reproductions could be admissible. In Case C-314/12 UPC Telekabel Wien (Reference for a preliminary ruling from the Oberster Gerichtshof (Austria) lodged on 29 June 2012) the Austrian court asks, amongst other things, whether ‘[…] reproduction for private use (Article 5(2)(b) of the Information Directive) and transient and incidental reproduction (Article 5(1) of the Information Directive) [is] permissible only if the original of the reproduction was lawfully reproduced, distributed or made available to the public’. See in this sense C. Geiger, 2010a. C. Geiger, ‘Challenges for the enforcement of copyright in the online world: Time for a new approach’ in P. Torremans (ed.) Research Handbook on the Cross-Border Enforcement of Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/ Northampton (US), 2014.

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situation in which the source from which a reproduction for private use is made is lawful from that in which that source is unlawful’.321

3. Towards horizontal harmonisation of practical solutions? 11.122 On the practical level, and in the absence of harmonisation, remuneration or compensation is being negotiated individually, by contract, or collectively, by collecting societies.322 Two recent related EU initiatives contain provisions on remuneration and/or compensation: in relation to permitted uses, Article 6(5) of the Orphan Works Directive323 lays down that: Member States shall provide that a fair compensation is due to rightholders that put an end to the orphan work status of their works […]. Member States shall be free to determine the circumstances under which the payment of such compensation may be organised. The level of the compensation shall be determined, within the limits imposed by Union law, by the law of the Member State in which the organisation which uses the orphan work in question is established.

11.123 Recital 18 adds that: due account should be taken, inter alia, of Member States’ cultural promotion objectives, of the noncommercial nature of the use made by the organisations in question in order to achieve aims related to their public-interest missions, such as promoting learning and disseminating culture, and of the possible harm to rightholders.324

11.124 Article 16(2) of the proposed Rights Management Directive325 states that: Licensing terms shall be based on objective and non-discriminatory criteria. When licensing rights, collective management organisations shall not be required to use, as a precedent for other online services, licensing terms agreed with a user where the user is providing a new type of online service which has been available to the public in the Union for less than three years. Rightholders shall receive appropriate remuneration for the use of their rights. Tariffs for exclusive rights and rights to remuneration shall be reasonable in relation to, inter alia, the economic value of the use of the rights in trade, taking into account the nature and scope of the use of the work and other subject-matter, as well as in relation to the economic value of the service provided by the collective management organisation. Collective management organisations shall inform the user concerned of the criteria used for the setting of those tariffs.

11.125 Large discretion is thus given to Member States in the determination of the appropriate amount of compensation; the main criterion given being the rights’ economic value in trade. With a view to ensuring coherence, subsequent clarifications of notions such as harm or fairness should be applied in a systematic and uniform manner across the copyright acquis. Article 5(7) of the Wittem Code contains some elements on fair and adequate remuneration, and imposes collective management of rights for some uses (including for private copying). Beyond systemic interpretation, actual

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Case C-435/12 ACI Adam BV and Others v Stichting de Thuiskopie and Others [2014] EUECJ C-435/12. The aforementioned agreement on remuneration between Google and French newspaper editors illustrates the territorial nature of solutions found in the current legal framework. Directive 2012/28/EU of the European Parliament and the Council of 25 October 2012 on certain permitted uses of orphan works. Guibault comments that application of these factors could lead to a very low compensation, as long as it qualifies as fair. Guibault, 2012. Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market, OJ L 84, 20.3.2014. Several recitals of the Copyright Directive acknowledge the importance of collective management for simple and transparent rights clearance (see Recitals 17, 26, and 55). Yet, Member States have the choice of arrangements relating to rights management (Recital 18).

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harmonisation of rights management might, indeed, be given some consideration as an ultimate means to facilitate permitted uses.

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights signed on 15 April 1994 (TRIPS). Berne Convention for the Protection of Literary and Artistic Works. Council Directive 91/250/EEC of the European Parliament and of the Council of 14 May 1991 on the legal protection of computer programs, OJ L 122/42, 17.5.1991. Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 346/61, 27.11.1992. Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, OJ L 248/5, 27.9.1993. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases, OJ No L 77/20, 27.03.96. Directive 2006/115 of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376, 27.12.2006 (codified version). Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs, OJ L111/16, 5.6.2009 (codified version). Directive 2012/28/EU of the European Parliament and the Council of 25 October 2012 on certain permitted uses of orphan works, OJ L 299, 27.10.2012. Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market, OJ L 84, 20.3.2014. International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations (Rome, 26 October 1961). Recommendation 2005/737/EC on collective cross-border management of copyright and related rights for legitimate online music services. WIPO Copyright Treaty (Geneva, 20 December 1996).

2. CJEU case law ACI Adam BV and Others v Stichting de Thuiskopie and Others (Case C-435/12) [2014] EUECJ C-435/12; Opinion of Advocate General Pedro Cruz Villalón delivered on 9 January 2014). Amazon.com International Sales Inc and Others v Austro-Mechana Gesellschaft zur Wahrnehmung mechanisch-musikalischer Urheberrechte Gesellschaft mbH (Case C-521/11) [2013] EUECJ C521/11. BestWater International GmbH v Michael Mebes, Stefan Potsch (Order of the Court) (Case C-348/13) [2014] EUECJ C-348/13_CO. C More Entertainment AB v Linus Sandberg (Case C-279/13) [2015] EUECJ C279/13. Copydan Båndkopi v Nokia Danmark A/S (Case C-463/12) [2015] EUECJ C-463/12. Deckmyn and Vrijheidsfonds (Case C-201/13) [2014] EUECJ C-201/13. DR, TV2 Danmark A/S v NCB – Nordisk Copyright Bureau (Case C-510/10) [2012] 26 April, not yet published; [2012] 2 CMLR 46. Duff and others (Case C-63/93) [1996] ECR I-569. Eva-Maria Painer v Standard VerlagsGmbH and Others (Case C-145/10) [2011] ECR I-00000; [2012] ECDR 6. Hewlett-Packard Belgium (Case C-572/13) [2015] EUECJ C-572/13. Football Association Premier League Ltd and Others v QC Leisure and Others and Karen Murphy v Media Protection Services Ltd (Joined Cases C-403/08 and C-429/08) [2011] ECR I-00000; [2012] ECDR 8. Funke Medien (Case C-469/17) [2019] EUECJ C-469/17. Haegemann v. Belgian State (Case 181/73) [1974] ECR 1974. Hermès International v. FHT Marketing Choice (Case C-53/96) [1998] ECR I-3603. Infopaq International A/S v Danske Dagblades Forening (Case C-5/08) [2009] ECR I-06569.

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Chapter 11 THE INFORMATION SOCIETY DIRECTIVE Infopaq International A/S v Danske Dagblades Forening (Order of the Court) (Case C-302/10) [2012] ECR I-00000; available at curia.europa.eu. Laserdisken ApS v Kulturministeriet (Case C-479/04) [2006] ECR I-08089. LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH (Order of the Court) (Case C-557/07) [2009] ECR I-01227. Martin Luksan v Petrus van der Let (Case C-277/10) [2012] EUECJ C-277/10. Nils Svensson, Sten Sjögren, Madelaine Sahlman, Pia Gadd v. Retreiver Sverige AB (Case C-466/12) [2014] EUECJ C-466/12]. Nilsson and others (Case-162/97) [1998] ECR I-7477. Nintendo and Others (Case C-355/12) [2013] EUECJ C-355/12. Ochranný svaz autorský pro práva k dílům hudebním, o.s. (OSA) v Lécˇebné lázně Mariánské Lázně, a.s. (Case C-351/12) [2014] EUECJ C-351/12. Padawan SL v Sociedad General de Autores y Editores de España (SGAE) (Case C-467/08) [2010] ECR I-10055. Productores de Música de España (Promusicae) v Telefónica de España SAU, (Case C-275/06) [2008] ECR I-271. Public Relations Consultants Association Ltd v The Newspaper Licensing Agency Ltd and others (Case C-360/13) [2014] EUECJ C-360/13. SENA (Case C-245/00) [2003] ECR I-1251. SRL CILFIT v Ministero della Sanità (Case C-283/81) [1982] ECR 3415. Stichting Brein v Jack Frederik Wullems (Case C-527/15) [2017] EUECJ C-527/15. Stichting de Thuiskopie v Opus Supplies Deutschland GmbH and Others (Case C-462/09) [2011] ECR I-00000; [2011] ECDR 18. Technische Universität Darmstadt (Case C-117/13) [2014] EUECJ C-117/13. UPC Telekabel Wien (Case C-314/12) [2014] EUECJ C-314/12. VCAST Ltd v RTI SpA (Case C-265/16) [2017] EUECJ C-265/16. Vereniging van Educatieve en Wetenschappelijke Auteurs (VEWA) v Belgische Staat (Case C-271/10) [2011] ECR I-00000; [2011] ECDR 19. Verwertungsgesellschaft Wort (VG Wort) v Kyocera, formerly Kyocera Mita Deutschland GmbH, Epson Deutschland GmbH, Xerox GmbH (Case C-457/11), Canon Deutschland GmbH (Case C-458/11), and Fujitsu Technology Solutions GmbH (Case C-459/11), Hewlett-Packard GmbH (Case C-460/11) v Verwer- tungsgesellschaft Wort (VG Wort) (Joined Cases C-457/11 to C-460/11) [2013].

3. Bibliography Akester, P. ‘The impact of digital rights management on freedom of expression – the first empirical assessment’, (2010) IIC, 31. Bechtold, S. ‘Information Society Directive, Article 5’, in Dreier, T. and P.B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law International, Alphen aan den Rijn, 2006. Belder, L., L.E. Dijkman and A.E.M. Mombers, ‘The age of copyright: Wittem’s copyright reform proposal compared to Samuelson’s preliminary thoughts’ (2011) QMJIP, 1(3), 200. Bénabou, V.-L. (2011) Propriétés intellectuelles No. 38. Bently, L. ‘Harmonization by stealth: The Role of the ECJ’, at the CRID/IvIR Conference, Ten Years after the EU Directive on Copyright in the Information Society: Looking Back and Looking Forward, European Parliament, Brussels, 13 January 2012. Bently, L. , E. Derclaye, R. Clark, G. Dinwoodie, T. Dreier, S. Dusollier, Ch. Geiger, J. Griffiths, R.M. Hilty, P.B. Hugenholtz, M.-C. Janssens, M. Kretschmer, A. Metzger, A. Peukert, M. Ricolfi, M. Senftleben, A. Strowel, M. Vivant and R. Xalabarder, ‘The reference to the CJEU in Case C-466/12 Svensson ’, University of Cambridge Faculty of Law Research Paper No. 6/2013. Berger, C. ‘Aktuelle Entwicklungen im Urheberrecht – Der EuGH bestimmt die Richtung’ (2012) ZUM, 353. Burrell R. and A. Coleman, Copyright Exceptions: The Digital Impact, Cambridge University Press, Cambridge, 2005. Christie, A. ‘Maximising permissible exceptions to intellectual property rights’, in Kur, A. and V. Myzaras (eds), The Structure of Intellectual Property Law – Can One Size Fit All?, Edward Elgar Publishing, Cheltenham (UK)/ Northampton (US), 2011. Conway, G. ‘Levels of generality in the legal reasoning of the European Court of Justice’, (2008) European Law Journal, 14(6), 787–805. Available at SSRN: http://ssrn.com/abstract=1283223 (accessed on 7 December 2012). Craig, P. ‘The legal effect of Directives: Policy, rules and exceptions’, (2009) European Law Review 34(3), 349–77. Craig, P. and G. De Búrca, EU Law, Text, Cases, and Materials, 5th ed., Oxford University Press, Oxford, 2011. Davies, G. ‘The convergence of copyright and authors rights – Reality or chimera?’, (1995) IIC, 964.

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ARTICLE 5: EXCEPTIONS AND LIMITATIONS Dreier, T. ‘The Wittem Project of a European Copyright Code’, in Geiger, C. (ed.), Constructing European Intellectual Property: Achievements and New Perspectives, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2013. Dreier, T. ‘Das WITTEM-Projekt eines “European Copyright Code”’, in Erdmann, W., M. Leistner, W. Rüffer, T. Schulte-Beckhaus (eds), Festschrift für Michael Loschelder, Verlag Otto Schmidt, Cologne, 2010. Dreier, T. ‘Limitations: The centerpiece of copyright in distress’, (2010) JIPITEC, 1, 50. Dreier, T. ‘Regulating competition by way of copyright limitations and exceptions’, in Torremans, P. (ed.), Copyright Law: A Handbook of Contemporary Research, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2007. Dusollier, S. and C. Colin ‘Peer-to-peer file sharing and copyright: what could be the role of collective management?’ (2011) Columbia Journal of Law & the Arts, 34(4), 809. Dusollier, S. and C. Ker, ‘Private copy levies and technical protection of copyright: the uneasy accommodation of two conflicting logics’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2009. Dusollier, S. Droit d’auteur et protection des œuvres dans l’univers numérique, Droits et exceptions à la lumière des dispositifs de verrouillage des œuvres, Larcier, Bruxelles, 2007. Dusollier, S. ‘Exceptions and technological measures in the European Copyright Directive of 2001 – An empty promise’ (2003) IIC 62. European Commission, ‘Public Consultation on the review of the EU copyright rules’, from 5 December 2013 to 5 February 2014, available at http://ec.europa.eu/internal_market/consultations/2013/copyright-rules/docs/ consultation-document_en.pdf (accessed in December 2013). European Commission, ‘Licences for Europe: industry pledges solutions to make more content available in the Digital Single Market’, IP/13/1072, 13 November 2013. Fahl, C.‚ ‘BGH: Vorschaubilder II’ (2012) MMR-Aktuell 331727. Geiger, C. (2014) ‘Challenges for the Enforcement of Copyright in the Online World: Time for a New Approach’, in Torremans, P. (ed.), Research Handbook on the Cross-Border Enforcement of Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US). Geiger, C. (2013a) ‘Effectivité et flexibilité: deux impératifs de l’adaptation du droit des “exceptions”’, RLDI, Special issue No 94, 41. Geiger, C. (2013b) ‘L’utilisation jurisprudentielle des droits fondamentaux en Europe en matière de propriété intellectuelle: Quel apport? Quelles perspectives?’, in Geiger, C. (ed.), La contribution de la jurisprudence à la construction de la propriété intellectuelle en Europe, Collection du CEIPI, Litec, Paris, 2013. Geiger, C. (2013c) ‘The construction of intellectual property in the European Union: Searching for coherence’, in Geiger, C. (ed.), Constructing European Intellectual Property: Achievements and New Perspectives, EIPIN Series vol 1, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2013. Geiger, C. (2012a) ‘Counterfeiting and the music industry: towards a criminalization of end users? The French “HADOPI” example’, in Geiger, C. (ed.), Criminal Enforcement of Intellectual Property: A Handbook of Contemporary Research, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2012. Geiger, C. (2012b) ‘Limitations and exceptions, “fair use” and the three-step test in relation to educational materials – A European perspective’, at the workshop, The International Copyright System and Access to Education: Challenges, New Access Models and Prospects for New Principles, Max Planck Institute for Intellectual Property and Competition Law, Munich, 14 May 2012. Geiger, C. (2011a) ‘Copyright and digital libraries, securing access to information in the digital age’, in Iglezakis, I., T.-E. Synodinou and S. Kapidakis (eds), E-Publishing and Digital Libraries: Legal and Organizational Issues, IGI Global Publishing, Hershey, PA, 2011. Geiger, C. (2011b) ‘Exploring the flexibilities of the TRIPS Agreement provisions on limitations and exceptions’, in Kur, A. and V. Mizaras (eds), The Structure of Intellectual Property Law – Can One Size Fit All?, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2011. Geiger, C. (2010a) ‘Promoting creativity through copyright limitations, reflections on the concept of exclusivity in copyright law’, (2010) Vanderbilt Journal of Entertainment & Technology Law, 12, 515. Geiger, C. (2010b) ‘Intellectual “property” after the Treaty of Lisbon, towards a different approach in the new European legal order?’, (2010) EIPR, 255. Geiger, C. (2010c) ‘The future of copyright in Europe: Striking a fair balance between protection and access to information/ L’avenir du droit d’auteur en Europe: Vers un juste équilibre entre protection et accès à l’information’, Report for the Committee on Culture, Science and Education – Parliamentary Assembly, Council of Europe, Strasbourg, July 2009, revised and updated in October 2009, extended version published in (2010) Intellectual Property Quarterly, 1–14.

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Chapter 11 THE INFORMATION SOCIETY DIRECTIVE Geiger, C. (2009a) ‘Intellectual property shall be protected!? – Article 17(2) of the Charter of Fundamental Rights of the European Union: A mysterious provision with an unclear scope’, (2009) EIPR, 31(3), 113–17. Geiger, C. (2009b) ‘Drafting the appropriate and balanced scope of copyright protection in the European Union – What language can contribute to the debate’, in Gendreau, Y. and A. Drassinower (eds), Language and Copyright/ Langues et droit d’auteur, Carswell/Bruylant, Québec/Brussels, 2009. Geiger, C. (2008a) ‘Flexibilising copyright’, (2008) IIC, 178. Geiger, C. (2008b) ‘Legal or illegal: That is the question! Private copying and downloading on the internet’, (2008) IIC, 597. Geiger, C. (2008c) ‘The answer to the machine should not be the machine, safeguarding the private copy exception in the digital environment’, (2008) EIPR, 121. Geiger, C. (2007a) ‘From Berne to national law, via the Copyright Directive: The dangerous mutations of the three-step test’, (2007) EIPR, 486. Geiger, C. (2007b) ‘The role of the three-step test in the adaptation of copyright law to the information society’, (2007) e-Copyright Bulletin, January–March. Geiger, C. (2007c) ‘Les exceptions au droit d’auteur en France (analyse critique et prospective)’, in Hilty, R.M. and C. Geiger (eds.), Impulse für eine europäische Harmonisierung des Urheberrechts, Urheberrecht im deutsch-französischen Dialog/Perspectives d’harmonisation du droit d’auteur en Europe, Springer/Litec LexisNexis, Berlin/Heidelberg/New York and Paris, 2007. Geiger, C. (2004a) ‘De la nature juridique des limites au droit d’auteur’, (2004) Propriétés intellectuelles, 13, 882–91. Geiger, C. (2004b) Droit d’auteur et droit du public à l’information, approche de droit comparé, Paris, Litec, 2004. Geiger, C. and F. Schönherr, ‘Defining the scope of protection of copyright in the EU: The need to reconsider the acquis regarding limitations and exceptions’, in Synodinou, T.-E. (ed.), Codification of European Copyright Law, Challenges and Perspectives, Kluwer Law International, Alphen aan den Rijn, 2012. Geiger, C., R. Hilty, J. Griffiths, and U. Suthersanen, ‘Declaration a balanced interpretation of the “three-step test” in copyright law’, (2010) JIPITEC, 1, 119. Geiger, C., F. Macrez, A. Bouvel, S. Carre, T. Hassler and J. Schmidt, ‘What limitations to copyright in the information society? A comment on the European Commission’s Green Paper “Copyright in the Knowledge Economy”’, (2009) IIC, 412. Ginsburg, J.C. ‘European copyright code – Back to first principles (with some additional detail)’, (2011) Columbia Public Law Research Paper, No. 11-261. Goldstein, P. and B. Hugenholtz, International Copyright, Principles, Law, and Practice, 2nd ed., Oxford University Press, New York, 2010. Gotzen, F. ‘Copyright in Europe: quo vadis? Some conclusions after the implementation of the information society harmonisation directive’, (2007) RIDA, 211, 3. Griffiths, J. ‘Unsticking the centre-piece – The liberation of European copyright law?’, (2010) JIPITEC, 1, 87. Griffiths, J. and L. McDonagh, ‘Fundamental rights and European IP law: The case of Art 17(2) of the EU Charter’, in Geiger, C. (ed.), Constructing European Intellectual Property: Achievements and New Perspectives, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2013. Guibault, L. ‘Are European orphans about to be freed?’, Kluwer copyright blog, 21 September 2012 (Retrieved from http://kluwercopyrightblog.com/2012/09/21/are-european-orphans-about-to-be-freed/ on 24 September 2012). Guibault, L. ‘Why cherry-picking never leads to harmonisation: The case of the limitations on copyright under Directive 2001/29/EC’, (2010) JIPITEC, 1, 55. Guibault, L. ‘Relationship between copyright and contract law’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2009. Halpern, S.W., C.A. Nard and K.L. Port, Fundamentals of United States Intellectual Property Law: Copyright, Patent, Trademark, 3rd ed., Wolters Kluwer, Alphen aan den Rijn, 2011. Hargreaves, I. ‘Digital opportunity, A review of intellectual property and growth’, May 2011, available at http:// www.ipo.gov.uk/ipreview-finalreport.pdf (last accessed on 23 October 2012). Hilty, R. ‘Declaration on the three-step test: Where do we go from here?’, (2010) JIPITEC, 1, 83. Hilty, R. ‘Copyright law and scientific research’, in Torremans, P. (ed.), Copyright Law: A Handbook of Contemporary Research, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2007. Hilty, R. ‘Five lessons about copyright in the information society: Reaction of the scientific community to over-protection and what policy makers should learn’, (2006) J Copyright Soc’y USA, 53. Hilty, R. ‘L’avenir du droit d’auteur dans le “dilemme numérique”’, (2005) Revue Lamy Droit de l’Immatériel, 1. Hilty, R., S. Krujatz, B. Bajon, A. Frueh, A. Kur, J. Drexl, C. Geiger, and N. Klass, ‘European Commission – Green Paper: Copyright in the Knowledge Economy – Comments by the Max Planck Institute for Intellectual

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ARTICLE 5: EXCEPTIONS AND LIMITATIONS Property, Competition and Tax Law’, Max Planck Institute for Intellectual Property, Competition & Tax Law Research Paper Series No. 08-05. Hilty, R. and C. Geiger (eds), Impulse für eine europäische Harmonisierung des Urheberrechts, Urheberrecht im deutschfranzösischen Dialog/ Perspectives d’harmonisation du droit d’auteur en Europe, Springer/ Litec LexisNexis, Berlin/ Heidelberg/ New York and Paris, 2007. Hudson, E.J. ‘Copyright exceptions: The experiences of cultural institutions in the United States, Canada and Australia’, Submitted in total fulfilment of the requirements of the degree of Doctor of Philosophy, Faculty of Law, University of Melbourne, November 2011. Available at http://dtl.unimelb.edu.au//exlibris/dtl/d3_1/apache_ media/L2V4bGlicmlzL2R0bC9kM18 xL2FwYWNoZV9tZWRpYS8yODM5MDM=.pdf (last accessed on 29 November 2012). Hugenholtz, P.B. ‘The dynamics of harmonization of copyright at the European level’, in Geiger, C. (ed.), Constructing European Intellectual Property: Achievements and New Perspectives, EIPIN Series vol 1, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2013. Hugenholtz, P.B. ‘Plagiarism and copyright’, at the 13th EIPIN conference, Imitation as Innovation, at the European Patent Office, Munich, 3–5 February 2012. Hugenholtz, P.B. ‘Fierce creatures, copyright exemptions: Towards extinction?’, at the IFLA/IMPRIMATUR Conference, Rights, Limitations and Exceptions: Striking a Proper Balance, Amsterdam, 30–31 October 1997. Hugenholtz, P.B. ‘Adapting copyright to the information superhighway’, in Hugenholtz, P.B. (ed.), The Future of Copyright in a Digital Environment, Kluwer Law International, The Hague, 1996. Hugenholtz, P.B. and M. Senftleben, ‘Fair Use in Europe. In Search of Flexibilities’, Amsterdam, November 2011, last accessed at http://www.ivir.nl/publications/hugenholtz/Fair%20Use%20Report%20PUB.pdf, on 28 January 2012. B. Hugenholtz, P.B. and R. Okediji, ‘Conceiving an international instrument on limitations and exceptions to copyright’, Final Report, March 2008. Janssens, M-C. ‘The issue of exceptions: reshaping the keys to the gates in the territory of literary, musical and artistic creation’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2009. Karapapa, S. Private Copying, Routledge research in intellectual property, Routledge, 2012. Karapapa, S. ‘Padawan v SGAE: a right to private copy?’, (2011) EIPR, 33(4), 244–59. Klimas, T. and J. Vaiciukaite, ‘The law of recitals in European Community legislation’, (2008) ILSA Journal of International & Comparative Law, 15 (available at SSRN: http://ssrn.com/abstract=1159604, last accessed on 16 November 2012). Koelman, K.J. ‘Fixing the three-step test’, (2006) EIPR, 28(8), 407–12. Kretschmer, M. ‘Private copying and fair compensation: A comparative study of copyright levies in Europe’, A Report for the UK Intellectual Property Office, September 2011. Kretschmer, M. ‘Private copying and fair compensation: An empirical study of copyright levies in Europe’, independent report commissioned by the Intellectual Property Office (IPO) and supported by the Economic and Social Research Council (ESRC) (grant RES-173–27–0220), September 2011 (found at http://www.ipo.gov.uk/ ipresearch-faircomp-full-201110.pdf in January 2013). Kuhlen, R. ‘Richtungsweisend oder eine nur begrenzt wahrgenommene Chance? Der Copyright-Code des WittemProjekts’, (2011) JIPITEC, 2, 18. Leczykiewicz, D. ‘“Effective judicial protection” of human rights after Lisbon: should national courts be empowered to review EU secondary law?’, (2010) European Law Review 35(3), 326–48. Leistner, M. ‘The German Federal Supreme Court’s judgment on Google’s image search – A topical example of the “limitations” of the European approach to exceptions and limitation’, (2011) IIC, 42(4), 417–42. Lucas, A. ‘For a reasonable interpretation of the three-step test’, (2010) EIPR, 278. Malenovský, J. ‘La contribution de la Cour de justice à l’harmonisation du droit d’auteur dans l’Union européenne’, ERA Forum, August 2012, available at http://link.springer.com/article/10.1007/s12027-012-0264-x (last accessed on 23 October 2012). Metzger, A. ‘Der Einfluss des EuGH auf die gegenwärtige Entwicklung des Urheberrechts’, (2012) GRUR, 118. Murray, Justice John L. (President of the Supreme Court and Chief Justice of Ireland), ‘Methods of Interpretation – Comparative Law Method’, Actes du colloque pour le cinquantième anniversaire des Traités de Rome 39–47. O’Dell, E., McGovern P., Hedley S., ‘Modernising Copyright, A report prepared by the Copyright Review Committee for the Department of Jobs, Enterprise and Innovation’, Dublin, 2013. Ohly, A. ‘Economic rights’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2009.

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Chapter 11 THE INFORMATION SOCIETY DIRECTIVE Okediji, R. ‘The international copyright system: Limitations, exceptions and public interest considerations for developing countries’ (2006) UNCTAD-ICTSD Project in IPRs and Sustainable Development, Issue Paper No. 15. Pihlajarinne, T. ‘Setting the limits for the implied license in copyright and linking discourse – The European perspective’, (2012) IIC, 700. Rahmatian, A. ‘Dealing with rights in copyright-protected works: Assignments and licenses’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2009. Reinbothe, J. ‘Chapter 11: Private Copy Levies’ in I. Stamatoudi (ed.), New Developments in EU and International Copyright Law, Alphen aan den Rijn: Kluwer Law International, 2016, 298. Ricketson, S. WIPO Information Session on Limitations and Exceptions, WIPO Study on Limitations and Exceptions of Copyright and Related Rights and the Digital Age, Geneva, 3–4 November 2008 (available at http://www.wipo.int/edocs/mdocs/copyright/en/sccr_17/sccr_17_www_111472.pdf). Rigamonti, C.P. ‘Schutz gegen Umgehung technischer Maßnahmen im Urheberrecht aus internationaler und rechtsvergleichender Perspektive’, (2005) GRUR Int. 1. Rosati, E. ‘The Wittem Group and the European Copyright Code’, (2010) JIPLP, 5(12), 862–8. Schillig, M. ‘The interpretation of European private law in the light of market freedoms and EU fundamental rights’, (2008) Maastricht Journal of European and Comparative Law, 15, 285–321. Available at SSRN: http://ssrn.com/ abstract=1341583 (last accessed on 7 December 2012). Samartzi, V. ‘Optimal vs sub-optimal use of DRM-protected works’, (2011) EIPR, 33(8), 517–27. Senftleben, M. ‘Comparative approaches to fair use: An important impulse for reforms in EU Copyright Law’, in Dinwoodie, G.B. (ed.), Methods and Perspectives in Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2014. Senftleben, M. (2010a) ‘The international three-step test. A model provision for EC fair use legislation’, (2010) JIPITEC, 1, 67. Senftleben, M. (2010b) ‘Bridging the differences between copyright’s legal traditions – The emerging fair use doctrine’, (2010) Journal of the Copyright Society of the USA, 57(3), 521. Senftleben, M. ‘Fair Use in the Netherlands – A Renaissance?’, (2009), Tijdschrift voor auteurs, media en informatierecht, 1, 2–4. Senftleben, M. ‘L’application du triple test: vers un système de fair use européen?’, (2007) Propriétés intellectuelles, 25, 453–60. Senftleben, M. ‘Beperkingen à la carte: Waarom de Auteurrechtrichtlijn ruimte lat voor fair use’, (2003) AMI. Sirinelli, P., A. Lucas, and A. Bensamoun (eds.), Les exceptions au droit d’auteur: Etat des lieux et perspectives dans l’Union Européenne, Dalloz, Paris, 2012. Smith, J. and R. Montagnon, ‘The Hargreaves Review – A “digital opportunity”‘, (2011) EIPR, 33(9), 596–9. Strowel, A. ‘Convergences entre droit d’auteur et copyright dans la société de l’information’, in INTERGU (ed.), Schutz von Kultur und geistigem Eigentum in der Informationsgesellschaft, Nomos, Baden-Baden, 1998. Synodinou, T.-E. ‘E-books, a new page in the history of copyright law?’, (2013) EIPR, 35(4), 220–27 Torremans, P.L.C. ‘L’exception de copie privée au Royaume-Uni’, in Sirinelli, P., A. Lucas, and A. Bensamoun (eds), Les exceptions au droit d’auteur: Etat des lieux et perspectives dans l’Union européenne, Paris, Dalloz, 2012. Ullrich, J.N. ‘Clash of copyrights – Optionale Schranke und zwingender finanzieller Ausgleich im Fall der Privatkopie nach Art. 5 Abs. 2 lit. b) Richtlinie 2001/29/EG und Dreistufentest’, (2009) GRUR Int., 283. van Eechoud, M., P.B. Hugenholtz, S. van Gompel, L. Guibault, N. Helberger, Harmonizing European Copyright Law, The Challenges of Better Lawmaking, Wolters Kluwer Law & Business, Alphen aan den Rijn, 2009. von Lewinski, S. ‘Article 5 Exceptions and Limitations’, in Walter, M.M. and S. von Lewinski (eds), European Copyright Law, A Commentary, Oxford University Press, Oxford, 2010. von Lewinski, S. ‘Rights management information and technical protection measures as implemented in EC Member States’, (2004) IIC, 844. Voorhoof, D. and I. Høedt-Rasmussen ‘ECHR: Copyright vs. freedom of expression’, 25 January 2013, Kluwer Blog, available at http://kluwercopyrightblog.com/2013/01/25/echr-copyright-vs-freedom-of-expression/ (last accessed on 26 March 2013). Westkamp, G. ‘Emerging escape clauses? Online exhaustion, consent and European copyright law’, in Rosén, J. (ed.), Intellectual Property at the Crossroads of Trade, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2013. Westkamp, G. ‘Part II, The Implementation of Directive 2001/29/EC in the Member States’, Centre for Commercial Law Studies, Queen Mary, University of London, February 2007. Wiebe, A. ‘Vertrauensschutz und geistiges Eigentum am Beispiel der Suchmaschinen’, (2011) GRUR, 888.

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ARTICLE 6: OBLIGATIONS AS TO TECHNOLOGICAL MEASURES Xalabarder, R. ‘Google News and Copyright’, in Lopez-Tarruella, A. (ed.), Google and the Law, TMC Asser Press, The Hague, 2012. Xalabarder, R. ‘Fair Use in Spain. The EUCD Aftermath’, in Ghidini, G. and L.M. Genovesi (eds.), Intellectual Property and Market Power, EUDEBA, Buenos Aires, 2008.

CHAPTER III PROTECTION OF TECHNOLOGICAL MEASURES AND RIGHTS-MANAGEMENT INFORMATION ARTICLE 6: OBLIGATIONS AS TO TECHNOLOGICAL MEASURES 1. 2.

3.

4.

Member States shall provide adequate legal protection against the circumvention of any effective technological measures, which the person concerned carries out in the knowledge, or with reasonable grounds to know, that he or she is pursuing that objective. Member States shall provide adequate legal protection against the manufacture, import, distribution, sale, rental, advertisement for sale or rental, or possession for commercial purposes of devices, products or components or the provision of services which: (a) are promoted, advertised or marketed for the purpose of circumvention of, or (b) have only a limited commercially significant purpose or use other than to circumvent, or (c) are primarily designed, produced, adapted or performed for the purpose of enabling or facilitating the circumvention of, any effective technological measures. For the purposes of this Directive, the expression “technological measures” means any technology, device or component that, in the normal course of its operation, is designed to prevent or restrict acts, in respect of works or other subject-matter, which are not authorised by the rightholder of any copyright or any right related to copyright as provided for by law or the sui generis right provided for in Chapter III of Directive 96/9/EC. Technological measures shall be deemed “effective” where the use of a protected work or other subject-matter is controlled by the rightholders through application of an access control or protection process, such as encryption, scrambling or other transformation of the work or other subject-matter or a copy control mechanism, which achieves the protection objective. Notwithstanding the legal protection provided for in paragraph 1, in the absence of voluntary measures taken by rightholders, including agreements between rightholders and other parties concerned, Member States shall take appropriate measures to ensure that rightholders make available to the beneficiary of an exception or limitation provided for in national law in accordance with Article 5(2)(a), (2)(c), (2)(d), (2)(e), (3)(a), (3)(b) or (3)(e) the means of benefiting from that exception or limitation, to the extent necessary to benefit from that exception or limitation and where that beneficiary has legal access to the protected work or subject-matter concerned. A Member State may also take such measures in respect of a beneficiary of an exception or limitation provided for in accordance with Article 5(2)(b), unless reproduction for private use has already been made possible by rightholders to the extent necessary to benefit from the exception or limitation concerned and in accordance with the provisions of Article 5(2)(b) and (5), without preventing rightholders from adopting adequate measures regarding the number of reproductions in accordance with these provisions. The technological measures applied voluntarily by rightholders, including those applied in implementation of voluntary agreements, and technological measures applied in implementation of the measures taken by Member States, shall enjoy the legal protection provided for in paragraph 1.

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The provisions of the first and second subparagraphs shall not apply to works or other subject-matter made available to the public on agreed contractual terms in such a way that members of the public may access them from a place and at a time individually chosen by them. When this Article is applied in the context of Directives 92/100/EEC and 96/9/EC, this paragraph shall apply mutatis mutandis.

SELECTED RECITALS (47) Technological development will allow rightholders to make use of technological measures designed to prevent or restrict acts not authorised by the rightholders of any copyright, rights related to copyright or the sui generis right in databases. The danger, however, exists that illegal activities might be carried out in order to enable or facilitate the circumvention of the technical protection provided by these measures. In order to avoid fragmented legal approaches that could potentially hinder the functioning of the internal market, there is a need to provide for harmonised legal protection against circumvention of effective technological measures and against provision of devices and products or services to this effect. (48) Such legal protection should be provided in respect of technological measures that effectively restrict acts not authorised by the rightholders of any copyright, rights related to copyright or the sui generis right in databases without, however, preventing the normal operation of electronic equipment and its technological development. Such legal protection implies no obligation to design devices, products, components or services to correspond to technological measures, so long as such device, product, component or service does not otherwise fall under the prohibition of Article 6. Such legal protection should respect proportionality and should not prohibit those devices or activities which have a commercially significant purpose or use other than to circumvent the technical protection. In particular, this protection should not hinder research into cryptography. (49) The legal protection of technological measures is without prejudice to the application of any national provisions which may prohibit the private possession of devices, products or components for the circumvention of technological measures. (50) Such a harmonised legal protection does not affect the specific provisions on protection provided for by Directive 91/250/EEC. In particular, it should not apply to the protection of technological measures used in connection with computer programs, which is exclusively addressed in that Directive. It should neither inhibit nor prevent the development or use of any means of circumventing a technological measure that is necessary to enable acts to be undertaken in accordance with the terms of Article 5(3) or Article 6 of Directive 91/250/EEC. Articles 5 and 6 of that Directive exclusively determine exceptions to the exclusive rights applicable to computer programs. (51) The legal protection of technological measures applies without prejudice to public policy, as reflected in Article 5, or public security. Member States should promote voluntary measures taken by rightholders, including the conclusion and implementation of agreements between rightholders and other parties concerned, to accommodate achieving the objectives of certain exceptions or limitations provided for in national law in accordance with this Directive. In the absence of such voluntary measures or agreements within a reasonable period of time, Member States should take appropriate measures to ensure that rightholders provide beneficiaries of such exceptions or limitations with appropriate means of benefiting from them, by modifying an implemented technological measure or by other means. However, in order to prevent abuse of such measures taken by rightholders, including within the framework of agreements, or taken by

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a Member State, any technological measures applied in implementation of such measures should enjoy legal protection. (52) When implementing an exception or limitation for private copying in accordance with Article 5(2)(b), Member States should likewise promote the use of voluntary measures to accommodate achieving the objectives of such exception or limitation. If, within a reasonable period of time, no such voluntary measures to make reproduction for private use possible have been taken, Member States may take measures to enable beneficiaries of the exception or limitation concerned to benefit from it. Voluntary measures taken by rightholders, including agreements between rightholders and other parties concerned, as well as measures taken by Member States, do not prevent rightholders from using technological measures which are consistent with the exceptions or limitations on private copying in national law in accordance with Article 5(2)(b), taking account of the condition of fair compensation under that provision and the possible differentiation between various conditions of use in accordance with Article 5(5), such as controlling the number of reproductions. In order to prevent abuse of such measures, any technological measures applied in their implementation should enjoy legal protection. (53) The protection of technological measures should ensure a secure environment for the provision of interactive on-demand services, in such a way that members of the public may access works or other subject-matter from a place and at a time individually chosen by them. Where such services are governed by contractual arrangements, the first and second subparagraphs of Article 6(4) should not apply. Non-interactive forms of online use should remain subject to those provisions.

RELATED INTERNATIONAL INSTRUMENTS WIPO COPYRIGHT TREATY ARTICLE 11: OBLIGATIONS CONCERNING TECHNOLOGICAL MEASURES Contracting Parties shall provide adequate legal protection and effective legal remedies against the circumvention of effective technological measures that are used by authors in connection with the exercise of their rights under this Treaty or the Berne Convention and that restrict acts, in respect of their works, which are not authorized by the authors concerned or permitted by law.

WIPO PERFORMANCES AND PHONOGRAMS TREATY ARTICLE 18: OBLIGATIONS CONCERNING TECHNOLOGICAL MEASURES Contracting Parties shall provide adequate legal protection and effective legal remedies against the circumvention of effective technological measures that are used by performers or producers of phonograms in connection with the exercise of their rights under this Treaty and that restrict acts, in respect of their performances or phonograms, which are not authorized by the performers or the producers of phonograms concerned or permitted by law.

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I. COMMENTARY 1. Background 11.126 Articles 6 and 7 of the Information Society Directive implement Article 11 WCT and Article 18 WPPT into European Union law. They reflect the tendency of recent years towards piracy and the fact that it has been accelerated by reason of digital technologies and the internet, which is that ‘the answer to the machine is the machine’.326 Yet, this is the sole international legal instrument that deals with anti-circumvention devices with the exception to a certain extent of the Council of Europe’s Convention of Cybercrime 2001.327

2. Similar provisions in EU law 11.127 At EU level, relevant provisions are found in other Directives, too. In particular the first provisions were found in the Computer Programs Directive328 and later in the Conditional Access Directive.329 Yet, these provisions either do not share the same purpose or are not meant to work together.330 Article 6 of the Information Society Directive, which is the most general one, prohibits (a) the circumvention of any effective technological devices used by the right holders of copyright of related rights with the aim to protect their works (para 1) and (b) a wide range of preparatory activities, such as the manufacture, import, distribution, sale, rental, advertisement for sale or rental, or possession for commercial purposes of such devices (para 2). The same article also defines ‘effective technological measures’ (para 3) and tries to reconcile such measures with the exceptions and limitations to copyright (para 4). Article 7(1)(c) of the Computer Programs Directive prohibits the circulation or possession for commercial purposes of any device solely meant to circumvent technological measures protecting computer programs. This article is meant to work alone (see Recital 50). 11.128 The Information Society Directive however affects its operation. Article 4 of the Conditional Access Directive prohibits the manufacture, import, distribution, sale, rental or possession, the installation, maintenance or replacement for commercial purposes as well as the use of commercial communications to promote anti-circumvention devices used in the pay TV, radio and information society services. Although this later provision comes very close to the Information Society Directive they do not share the same aim. The first is intended to protect services (and in particular the unauthorised reception of conditional access services) and the latter to protect copyright and/or related rights content. It does not follow that the aforementioned services contain such copyright and/or related rights protected content.

3. Effective technological measures (para. 3) 11.129 Article 6(3) defines what ‘effective technological measures’ are. ‘Technological measures’ are:

326 327 328 329 330

C. Clark, ‘The answer to the machine, is the machine’, in P.B. Hugenholtz, The Future of Copyright in a Digital Environment, Kluwer Law International, 1996, 139. And in particular Arts 2, 3 and 6. The Convention came into force in July 2004. Article 7(1)(c) Dir. 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs (codified version) OJ L 111/16, 5.5.2009. Article 4 of Dir. 98/84/EC of the European Parliament and of the Council of 20 November 1998 on the legal protection of services based on, or consisting of, conditional access OJ L 320/54, 28.11.1998. See also Case C-458/13, Andreas Grund acting as administrator in the insolvency proceedings concerning the assets of SR-Tronic GmbH, and Others v Nintendo Co Ltd and Nintendo of America Inc (Order of the Court of 7 May 2014).

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ARTICLE 18: OBLIGATIONS CONCERNING TECHNOLOGICAL MEASURES any technology, device or component that, in the normal course of its operation, is designed to prevent or restrict acts, in respect of works or other subject matter, which are not authorised by the right holder of any copyright or any right related to copyright as provided for by law or the sui generis right.

‘Technology, device or component’ includes both software and hardware, which are either independent or part of another entity. Technological measures may include measures incorporated not only in protected works themselves but also in devices designed to allow access to those works. In Case C-355/12 Nintendo, the Court of Justice held that the concept of an: ‘effective technological measure’, for the purposes of Article 6(3), covers technological measures comprising, principally, equipping not only the housing system containing the protected work, such as the videogame, with a recognition device in order to protect it against acts not authorised by the holder of any copyright, but also portable equipment or consoles intended to ensure access to those games and their use.331

Technological measures may be in digital or analogue form. No particular prerequisites in this respect are set by the Directive. They must be designed in the normal course of their operation to prevent or restrict acts in respect of protected works or subject matter. That means that their aim – or at least their main aim – should consist in preventing or restricting acts either through the control of access or use of such works.332 This may become apparent because it is expressly indicated on the device or is assumed by the features accompanying the device or by the circumstances (e.g. advertising) or even by its actual operation. These technological measures need to be ‘effective’. They are deemed ‘effective’ where – through the 11.130 application of an access control or protection process – they achieve the protection objective. In other words, if the objective is not attained then the device is not considered effective. That would, for example, be the case if the device did not work at all. It would not be the case though if the technological measure at issue was of a low quality or primitive technology (e.g. could be easily hacked) to the extent that the protection it provided to the work was at best limited. Paragraph 3 mentions types of access control and protection processes such as encryption, scrambling or other transformation of the work or other subject matter as well as copy control mechanisms.333 This

331 332

See Case C-355/12 Nintendo and Others [2014] EUECJ C-355/12. When determining whether measures of that kind qualify for protection pursuant to Article 6 of Directive 2001/29/EC where they have the effect of preventing or restricting not only acts which require the rightholder’s authorisation pursuant to that directive but also acts which do not require such authorisation, a national court must verify whether the application of the measures complies with the principle of proportionality and, in particular, must consider whether, in the current state of technology, the former effect could be achieved without producing the latter effect or while producing it to a lesser extent. See also: When determining whether protection must be provided against any supply of devices, products, components or services pursuant to Article 6(2) of Directive 2001/29, it is not necessary to consider the particular intended use attributed by the rightholder to a device designed to allow access to protected works. By contrast, the extent to which the devices, products, components or services against which protection is sought are or can be used for legitimate purposes other than allowing acts which require the rightholder’s authorisation is a relevant consideration.

333

AG’s Opinion in Nintendo and Others (Case C-355/12) (19 September 2013). The Court’s decision was issued on 23 January 2014, [2013] EUECJ C-355/12. M.M. Walter, in M.M. Walter (ed.), Europäisches Urheberrecht: Kommentar, Vienna, Springer, 2001, 1068 distinguishes between three categories of technological measures: (a) those that protect access to and use of copyright works (e.g. encryption technologies, digital containers, passwords, serial numbers and copy-control devices such as CGMS and SCMS), (b) those that protect the integrity and authenticity of copyright works and devices (e.g. hash functions, digital signatures and challenge response controls), and (c) those that prevent a third party from tampering with security features (e.g. smart cards, code obfuscation, trusted computing technology and other tamper-resistant hardware and software). Even region coding systems found in commercial DVDs may also be considered anti-circumvention devices. See Kabushiki Kaisha Sony Computer Entertainment Inc et al. v Ball et al., High Court of Justice (UK) (Chancery Division) 19 July 2004 [2004] EWHC 1738.

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enumeration in law is only indicative and by no means exhaustive. It also encompasses technological advances in the area even if they are combined with other devices such as rights management information aiming at the management/licensing of works. 11.131 Technological measures should aim at the protection of works protected by copyright, related rights as well as by the sui generis right provided in the database Directive.334 The wording ‘provided for by law’ assumes that copyright and related rights in general are covered by this Article and not only the rights enshrined in the Directive.335 The wording of Recitals 47 and 48 is also similar.336 An a contrario argument can be derived in this respect by the wording of Article 7(1)(b) which makes direct reference to ‘other subject matter protected under this Directive’ and by the fact that this is not uncommon in EU law if we take the example of the Enforcement Directive, which applies to copyright and related rights in general. Given that anti-circumvention devices constitute means of practical enforcement it would only be logical to derive that they cover the whole scope of copyright and related rights as the case is with the Enforcement Directive. The sui generis database right is mentioned expressly since it is not considered sensu stricto a related right. 11.132 Acts to be prevented or restricted should not have been authorised by the right holders. Right holders may be the original author or related rights right holder or any agent, licensee, subsequent right holder or anyone who derives rights from the initial or subsequent right holder concerning all or part of the rights in a work or subject matter. 11.133 If a work (or other subject matter) is not protected (or is no longer protected) technological measures may be circumvented. That, however, is not the case where both protected and unprotected matter are combined or co-exist in the same product. In this case technological measures are justified to the extent that there is no misuse of such dual use; such case would be, for example, where technological measures are used to substitute the absence of copyright protection by technological protection.337 11.134 Article 6 does not impose any obligation on producers to produce or offer products or services complying with technological measures. It is up to them to decide whether or not they want to make use of this provision (Recital 48).

4. Circumvention (para. 1) 11.135 Article 6(1) focuses on circumvention. According to it Member States have to provide adequate legal protection against the circumvention of any effective technological measures, which the person concerned carries out in the knowledge, or with reasonable grounds to know, that he or she is pursuing that objective. 11.136 By ‘circumvention’ is meant any act aiming at tampering with the technological measure so as to avoid it, eliminate it or escape its function, in order for the person tampering with it – or a third person on whose behalf the former tampers with the measure – to gain access to the work and perform the protected act, which would otherwise have been prevented by the measure.

334 335

336 337

Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases, OJ L 77/20, 27.03.1996. von Lewinski in von Lewinski and Walter (2010), 1066–7, which alleges that copyright – as provided in national law – is covered, and that related rights – provided in the Information Society Directive only – are covered. Bechtold (2006), 386, alleges that only the rights provided in the Information Society Directive are included. ‘… any copyright, rights related to copyright or the sui generis right in databases’. As in von Lewinski, 1067 and Bechtold, 387.

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Tampering may take place by any means or manner and it is not technology specific. The 11.137 circumvention should take place in relation to ‘effective technological measures’ as these measures have been defined in the previous section. In other words, the technology should be functional and should not have already been eliminated/circumvented by someone else. The person who circumvents the measure should carry out this act in the knowledge, or with 11.138 reasonable grounds to know, that he is pursuing that objective. That means that the person should act either with intention or with gross negligence. If that is not the case (e.g. the person performs some other act and in the course of this action he also eliminates the measure by mistake) no sanctions should be imposed on that person. Member States must provide for ‘adequate legal protection’ against circumvention. The content of 11.139 this protection is not specified but rather left at the discretion of Member States. That means that Member States may provide for any appropriate legal means, such as administrative remedies, civil remedies or criminal remedies or a combination thereof. Civil remedies may include interim measures/injunctions, seizures and damages. Such legal protection should respect proportionality and should not prohibit those devices or 11.140 activities, which have a commercially significant purpose or use other than to circumvent the technical protection (Recital 48). This is the case where technological measures are circumvented for security systems research, e.g. research into cryptography. This is necessary in order for technology to advance and new systems (safer and more secure) to be developed. Technological protection, as this protection is enshrined in Article 6, should not hinder such research.

5. Preparatory acts (para. 2) Paragraph 2 focuses on preparatory acts. In any case no protection would be effective or adequate if 11.141 preparatory acts – that have a multiplying effect with regard to third party possibility of circumventing technological measures – were not covered. Such acts are expressly mentioned in Article 6 (2) and discussed below:

A. The Manufacture, Import, Distribution, Sale, Rental, Advertisement for Sale or Rental, or Possession for Commercial Purposes of Devices, Products or Components or the Provision of Services ‘Manufacture’ equals the production of any tangible tools (e.g. devices, products or components that 11.142 as such may not be used for circumvention but if combined with other components or devices they may perform this task). ‘Import’ signifies both commercial and private import in a tangible form in the EU, however it does 11.143 not cover the provision of services through online transmission from a non-EU country. ‘Distribution’ can only be understood as covering sale since rental is mentioned separately.

11.144

‘Rental’ should be afforded the meaning it has under the Rental and Lending Rights Directive.338

11.145

338

Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (codified version), OJ L 376/28, 27.12.2006.

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11.146 ‘Advertising’ means the promotion for sale or rental to the general public, specialised entities or interested parties through print media (e.g. journals, magazines, leaflets) or TV, radio and the internet. It has to be distinguished from mere reporting (see Munich Court of Appeals, 2005).339 11.147 ‘Possession for commercial purposes’ of devices, etc., is also included. Possession should be understood to include illegal possession, too, since it is not referred to with a particular meaning in the law but as a matter of fact. Although the Directive refers to ‘possession for commercial purpose’ Member States may also prohibit the private possession of circumvention tools (Recital 49). 11.148 ‘Provision of services’ covers the online transmission of circumvention tools as well as the provision of any kind of services, which do not relate to the provision of tangible goods, such as offering assistance or guidance in circumventing a technological protection measure. 11.149 The aforementioned acts are actionable and subject to sanctions if at least one out of the three requirements which follow are met. (a)

(b) (c)

They are promoted, advertised or marketed for the purpose of circumvention. That means that if they are promoted for purposes other than circumvention and in any case if the main purpose of their advertising is not the circumvention then these acts cannot be sanctioned. They have only a limited commercially significant purpose or use other than to circumvent. That means that their main purpose should be circumvention. They are primarily designed, produced, adapted or performed for the purpose of enabling or facilitating circumvention. This issue should be assessed on an objective rather than subjective basis. It is not the intention of the designer, producer or other that should be examined but rather the objective features and purpose of the technology designed.

11.150 Contributory infringement applies in relation to the aforementioned acts in compliance with what is provided in national laws. In 2005 the Munich Court of Appeals prohibited an online news site from putting a hypertext link to a site offering illegal circumvention tools. Yet, this case was subsequently reversed.340 For comments on Article 6(4) see the section on Article 5, paras 11.109 to 11.113.

339 340

BMG Records GmbH v Heise Zeitshcriften Verlag GmbH & KG, Oberlandesgerichthof Munchen No 29 U 2887/05 28 July 2005 ECLR vol. 10, No 31, 792. The Bundesverfassungsgericht (German Federal Constitutional Court), Germany’s highest court, confirmed the BGH’s decision (case reference: 1 BvR 1248/11) of 15 December 2011 and agreed with the lower court’s balancing of Intellectual Property Rights and freedom of press and freedom of opinion. In summary: placing a link to a third party website on one’s own website ‘could not only be interpreted as a mere technical service and thus in isolation, but was due to its character of providing information’ also covered by the constitutional guarantees of freedom of press and freedom of opinion. The Bundesverfassungsgericht thus agreed with the BGH, which had held that purpose of the links on Heise’s website was not only to technically facilitate to access the SlySoft’s website but the links were to be regarded as part of Heise’s reporting because they were complementing and ‘backing up’ what was reported with additional information. The BGH had also held that the fact that Heise was aware that the software offered on SlySoft’s website was copyright infringing did not change this and so could not be blamed on Heise since the information interest of the general public was of higher importance. In its appeal decision the Bundesverfassungsgericht stressed that by placing the link to SlySoft’s website on its own website, Heise did not automatically make the content of SlySoft’s website its own opinion. Finally, the Bundesverfassungsgericht pointed out that the BGH had correctly balanced the conflicting rights when it had found that Heise’s placing of the link did not further encroach (‘no deepening of the encroachment’) in the claimant’s copyrights since SlySoft’s website could very easily be found via an Internet search engine anyway extract from http://ipkitten. blogspot.gr/2012/02/german-constitutional-court-confirms.html.

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NOTES 1. Related instruments Directive 98/84/EC of the European Parliament and of the Council of 20 November 1998 on the legal protection of services based on, or consisting of, conditional access, OJ L 320/54, 28.11.1998. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases, OJ L 77/20, 27.03.1996. Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (codified version), OJ L 376/28, 27.12.2006. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs (codified version) OJ L 111/16, 5.5.2009. World Copyright Treaty (WCT) of 20 December 1996. WIPO Performances and Phonograms Treaty (WPPT) of 20 December 1996. See also Related Instruments at Art. 5.

2. CJEU case law See case law at Art. 5.

3. Bibliography Bechtold, S. ‘Information Society Directive, Article 5’, in Dreier, T. and P.B. Hugenholtz (eds), Concise European Copyright Law, Kluwer Law International, Alphen aan den Rijn, 2006. Clark, C. ‘The answer to the machine, is the machine’, in P.B. Hugenholtz, The Future of Copyright in a Digital Environment, Kluwer Law International, Alphen aan den Rijn, 1996. See also Bibliography at Arts 4 and 5.

ARTICLE 7: OBLIGATIONS CONCERNING RIGHTS-MANAGEMENT INFORMATION 1.

2.

Member States shall provide for adequate legal protection against any person knowingly performing without authority any of the following acts: (a) the removal or alteration of any electronic rights-management information; (b) the distribution, importation for distribution, broadcasting, communication or making available to the public of works or other subject-matter protected under this Directive or under Chapter III of Directive 96/9/EC from which electronic rightsmanagement information has been removed or altered without authority, if such person knows, or has reasonable grounds to know, that by so doing he is inducing, enabling, facilitating or concealing an infringement of any copyright or any rights related to copyright as provided by law, or of the sui generis right provided for in Chapter III of Directive 96/9/EC. For the purposes of this Directive, the expression “rights-management information” means any information provided by rightholders which identifies the work or other subject-matter referred to in this Directive or covered by the sui generis right provided for in Chapter III of Directive 96/9/EC, the author or any other rightholder, or information about the terms and conditions of use of the work or other subject-matter, and any numbers or codes that represent such information. The first subparagraph shall apply when any of these items of information is associated with a copy of, or appears in connection with the communication to the public of, a work or other subject-matter referred to in this Directive or covered by the sui generis right provided for in Chapter III of Directive 96/9/EC.

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SELECTED RECITALS (54) Important progress has been made in the international standardisation of technical systems of identification of works and protected subject-matter in digital format. In an increasingly networked environment, differences between technological measures could lead to an incompatibility of systems within the Community. Compatibility and interoperability of the different systems should be encouraged. It would be highly desirable to encourage the development of global systems. (55) Technological development will facilitate the distribution of works, notably on networks, and this will entail the need for rightholders to identify better the work or other subject-matter, the author or any other rightholder, and to provide information about the terms and conditions of use of the work or other subject-matter in order to render easier the management of rights attached to them. Rightholders should be encouraged to use markings indicating, in addition to the information referred to above, inter alia their authorisation when putting works or other subject-matter on networks. (56) There is, however, the danger that illegal activities might be carried out in order to remove or alter the electronic copyright-management information attached to it, or otherwise to distribute, import for distribution, broadcast, communicate to the public or make available to the public works or other protected subject-matter from which such information has been removed without authority. In order to avoid fragmented legal approaches that could potentially hinder the functioning of the internal market, there is a need to provide for harmonised legal protection against any of these activities. (57) Any such rights-management information systems referred to above may, depending on their design, at the same time process personal data about the consumption patterns of protected subject-matter by individuals and allow for tracing of on-line behaviour. These technical means, in their technical functions, should incorporate privacy safeguards in accordance with Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and the free movement of such data.

RELATED INTERNATIONAL INSTRUMENTS WIPO COPYRIGHT TREATY ARTICLE 12: OBLIGATIONS CONCERNING RIGHTS MANAGEMENT INFORMATION (1)

(2)

Contracting Parties shall provide adequate and effective legal remedies against any person knowingly performing any of the following acts knowing, or with respect to civil remedies having reasonable grounds to know, that it will induce, enable, facilitate or conceal an infringement of any right covered by this Treaty or the Berne Convention: (i) to remove or alter any electronic rights management information without authority; (ii) to distribute, import for distribution, broadcast or communicate to the public, without authority, works or copies of works knowing that electronic rights management information has been removed or altered without authority. As used in this Article, “rights management information” means information which identifies the work, the author of the work, the owner of any right in the work, or information about the terms and conditions of use of the work, and any numbers or codes that represent such information, when any of these items of information is attached to a copy of a work or appears in connection with the communication of a work to the public.

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ARTICLE 19: OBLIGATIONS CONCERNING RIGHTS MANAGEMENT INFORMATION

WIPO PERFORMANCES AND PHONOGRAMS TREATY ARTICLE 19: OBLIGATIONS CONCERNING RIGHTS MANAGEMENT INFORMATION (1)

(2)

Contracting Parties shall provide adequate and effective legal remedies against any person knowingly performing any of the following acts knowing, or with respect to civil remedies having reasonable grounds to know, that it will induce, enable, facilitate or conceal an infringement of any right covered by this Treaty: (i) to remove or alter any electronic rights management information without authority; (ii) to distribute, import for distribution, broadcast, communicate or make available to the public, without authority, performances, copies of fixed performances or phonograms knowing that electronic rights management information has been removed or altered without authority. As used in this Article, “rights management information” means information which identifies the performer, the performance of the performer, the producer of the phonogram, the phonogram, the owner of any right in the performance or phonogram, or information about the terms and conditions of use of the performance or phonogram, and any numbers or codes that represent such information, when any of these items of information is attached to a copy of a fixed performance or a phonogram or appears in connection with the communication or making available of a fixed performance or a phonogram to the public.

I. COMMENTARY 1. Background Article 7 of the Information Society Directive deals with rights management information (also 11.151 known as DRM) and implements Article 12 WCT and Article 19 WPPT into EU law. The aim of this Article is to protect the means by which content is not only copied (Art. 6 of the Information Society Directive) but also identified and managed. For the purposes of the Directive such content should be protected by copyright, related rights (those covered by the Directive) and the sui generis database right. Public domain works are not covered.

2. Rights management information ‘Rights management information’ (according to Art. 7(2)) means any information provided by right 11.152 holders, which identifies the work or other subject matter, the author or any other right holder, or information about the terms and conditions of use of the work or other subject matter as well as any numbers or codes that represent such information. Therefore DRMs used for the management of the work are the ones that identify the work, the author/right holder and the usage terms. They cover both rights management information and the numbers and codes representing such information to the extent that they appear in electronic format. Conventional information or numbering such as ISBN (for books), ISSN (for periodicals) and so on are not covered by this Article to the extent that they are applied on conventional non-electronic works. The rights management information does not necessarily need to be embedded in the work or be directly attached to it. They may accompany it, be associated with it, or appear in connection with it. For example such information may be stored and retrieved from a central database once the work is transmitted. It does not also form a prerequisite that such information is visible to users.

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11.153 Rights management information should also incorporate privacy safeguards in accordance with EU privacy directives. That means that in cases where such facility processes personal data about the consumption patterns of protected subject matter by individuals and allows for the tracing of individuals’ online behaviour, it is not covered by this article and therefore not protected with regard to those functions (Recital 57).

3. ‘Adequate legal protection’ for persons ‘knowingly’ performing ‘unauthorised’ acts of ‘works or protected subject matter’ 11.154 The protection extends beyond and above rights management information in order to meet the needs of a practically effective system. It provides that Member States should enact adequate legal protection against any person knowingly (a) removing or altering any rights management information or (b) distributing, importing for distribution, broadcasting, communication or making available to the public of works or other subject matter protected under this Directive (including the sui generis right in databases) without the right holder’s authorisation. 11.155 This article applies to copyright (including statutory remuneration rights, which derive either by reason of the exceptions and limitations or as independent rights), to the four related rights provided in the Directive (performances, phonograms, films and broadcasts) and the sui generis right in databases. In this sense it extends the scope of application of the equivalent articles in WCT and WPPT to film producers, broadcasting organisations and the sui generis right. 11.156 ‘Adequate legal protection’ means that Member States have the discretion to apply a set of remedies and sanctions of administrative, civil or criminal nature or a combination thereof in the same manner as provided under Article 6. 11.157 Concerning the ‘right holder’s authorization’ the discussion under Article 6 applies here, too. An act is authorised if the right holder has permitted its removal or alteration. 11.158 A person has acted knowingly if that person knew or had reasonable grounds to know, that by doing so he was inducing, enabling, facilitating or concealing an infringement of any of the rights covered by the Directive. So first-degree knowledge (or else positive knowledge)/intention is required. Gross negligence (‘had reasonable grounds to know’) is also included. One induces, enables, facilitates or conceals an infringement when he performs any act, which leads a third party in good faith to further use/license/exploit a work on the basis of the information carried by it and which he trusts as being the authentic.

4. Actionable acts 11.159 One has to either (a) remove or alter any rights management information (DRM) or (b) distribute, import for distribution, broadcast, communicate or make available to the public works or protected subject matter from which electronic rights management information has been removed or altered without authority. 11.160 Under (a) any acts which result in the removal/destruction or change by means of addition, deletion or transformation of DRM, are included. Under (b) any subsequent acts relating to works or subject matter whose DRM has been touched upon/altered or removed by the aforementioned means are also actionable to the extent that they are considered to be distribution, importation for distribution or communication to the public (i.e. broadcast or making available to the public). According to

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S. von Lewinski,341 the distribution right should be construed widely and cover all forms of distribution including rental and lending (and not only sale or other forms of transfer of property: distribution in the narrow sense). Otherwise there could be a situation where this article would apply in the case where a DVD was imported into the EU for sale but not for rental. This would defy the purpose of the provision. Importation should be understood as importation from a third country into the EU in order for obstacles to the Single Market not to be created. The remainder of the rights indicated in this provision can be bundled under the broader right of communication. Reproduction of a work whose DRM has been touched upon/altered or removed by the afore- 11.161 mentioned (under (a) above) means and the sending of a copy to a friend are not covered by Article 7. The distribution of false rights management information, if that information was not combined with the work beforehand, is also not covered. Preparatory acts for removing or altering DRMs are not covered such as the production of devices facilitating such removal or alteration.342 DRMs are protected by Article 7 once the right holder decides to apply them to the work. Right holders are under no obligation to apply them. To the extent that any of these acts relate to technological measures used (or also used) for the 11.162 protection of the works at issue then both Article 7 and Article 6 may be infringed.

5. Other issues Recital 54 underlines the progress of international standardisation and identification systems and 11.163 encourages their compatibility and interoperability within the EU. Recital 55 encourages right holders to use markings – on top of the information provided – 11.164 indicating particularly the authorisation of the uses of their work or protected subject matter.

NOTES 1. Related instruments World Copyright Treaty (WCT) of December 20 1996. WIPO Performances and Phonograms Treaty (WPPT) of December 20 1996.

2. Bibliography See also Bibliography at Art. 6.

CHAPTER IV COMMON PROVISIONS ARTICLE 8: SANCTIONS AND REMEDIES 1.

341 342

Member States shall provide appropriate sanctions and remedies in respect of infringements of the rights and obligations set out in this Directive and shall take all the measures necessary to ensure that those sanctions and remedies are applied. The sanctions thus provided for shall be effective, proportionate and dissuasive. von Lewinski, 1079. Bechtold, 397.

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2.

3.

Each Member State shall take the measures necessary to ensure that rightholders whose interests are affected by an infringing activity carried out on its territory can bring an action for damages and/or apply for an injunction and, where appropriate, for the seizure of infringing material as well as of devices, products or components referred to in Article 6(2). Member States shall ensure that rightholders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe a copyright or related right.

SELECTED RECITALS (16) Liability for activities in the network environment concerns not only copyright and related rights but also other areas, such as defamation, misleading advertising, or infringement of trademarks, and is addressed horizontally in Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market (“Directive on electronic commerce”)(4), which clarifies and harmonises various legal issues relating to information society services including electronic commerce. This Directive should be implemented within a timescale similar to that for the implementation of the Directive on electronic commerce, since that Directive provides a harmonised framework of principles and provisions relevant inter alia to important parts of this Directive. This Directive is without prejudice to provisions relating to liability in that Directive. (58) Member States should provide for effective sanctions and remedies for infringements of rights and obligations as set out in this Directive. They should take all the measures necessary to ensure that those sanctions and remedies are applied. The sanctions thus provided for should be effective, proportionate and dissuasive and should include the possibility of seeking damages and/or injunctive relief and, where appropriate, of applying for seizure of infringing material. (59) In the digital environment, in particular, the services of intermediaries may increasingly be used by third parties for infringing activities. In many cases such intermediaries are best placed to bring such infringing activities to an end. Therefore, without prejudice to any other sanctions and remedies available, rightholders should have the possibility of applying for an injunction against an intermediary who carries a third party’s infringement of a protected work or other subject-matter in a network. This possibility should be available even where the acts carried out by the intermediary are exempted under Article 5. The conditions and modalities relating to such injunctions should be left to the national law of the Member States.

I. COMMENTARY 1. Introduction 11.165 Article 8 provides for the means of enforcement of the provisions of the Information Society Directive. In other words it covers only the rights regulated in the Directive and not copyright and related rights in general. The Computer Programs Directive (Art. 7(2)) and the Database Directive (Art. 12) also deal with sanctions and remedies in relation to the subject matter they regulate. At

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EU level, the 2003 Product Piracy Regulation (Art. 18)343 also deals with ‘penalties’ in cases of violation of the Regulation’s provisions. All sanctions or remedies should be effective, proportionate and dissuasive. Yet, the aforementioned provisions are only partial since they refer to the subject matter and scope 11.166 of each Directive/Regulation only and do not follow a holistic approach. This holistic approach is offered by the Enforcement Directive, which harmonises sanctions and remedies offered by Member States under civil law and extends such harmonisation to all intellectual property rights under both EU law and national law, including copyright and related rights. Although Article 2(2) of this Directive provides that the aforementioned provisions remain unaffected, this is of limited significance only since the Directive itself is larger in scope compared to the aforementioned provisions. Member States’ international obligations for providing for sanctions and remedies derive from the 11.167 TRIPs Agreement (Arts 41–61), which has, however, a limited scope compared to the Enforcement Directive; they also derive from Article 14(2) WCT (regarding copyright) and Article 23(2) WPPT (regarding related rights for performing artists and producers of phonograms). Article 8 of the Information Society Directive implements such obligations.

2. Article 8(1) Article 8(1) provides for the following obligations: (a) Member States should provide for ‘appropri- 11.168 ate sanctions and remedies’ in cases of infringements of any rights/obligations enshrined in the Directive; (b) these sanctions/remedies should be ‘effective, proportionate and dissuasive’ (in conformity with Directive 2004/48 on Enforcement and in particular Art. 3(2) and Art. 18 of the Product Piracy Regulation 2003) and (c) Member States should also provide for the means of enforcing/applying these sanctions and remedies. The term ‘appropriate’ does not seem to add anything to the nature of the sanctions and remedies 11.169 compared to what is required under the adjectives ‘effective, proportionate and dissuasive’. In any case the emphasis is placed on the effective nature of the means. Once effectiveness is stressed, proportionality follows, while the sentence closes with another form of ‘effectiveness’, this being the fact that the means should also be dissuasive.

3. Article 8(2) According to Article 8(2) Member States should take measures necessary to ensure that right 11.170 holders, whose interests are affected by an infringing activity carried out on its territory, can bring an action for damages and/or apply for an injunction and, where appropriate, for the seizure of infringing material as well as of devices, products or components referred to in Article 6(2). Damages and injunctions – as provided by this article – only apply to those rights enshrined in the Directive. Equivalent harmonised provisions, however, are found in Directive 2004/48 on Enforcement (i.e. Art. 9(1)(b) (seizure), Art. 11 (injunction), Art. 13 (damages)). These Articles are more detailed and extended in scope (e.g. Art. 9(1)(b) Directive 2004/48 on Enforcement is not limited to seizures ‘where appropriate’).

343

As of January 2014, Regulation 608/2013 applies repealing Council Regulation (EC) No 1383/2003 of 22 July 2003 concerning customs action against goods suspected of infringing certain intellectual property rights and the measures to be taken against goods found to have infringed such rights, OJ L 181, 29.6.2013.

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4. Article 8(3) – Injunctions against intermediaries A. Introduction 11.171 Article 8(3) imposes on Member States the obligation to ensure that right holders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe a copyright or related right. 11.172 The concept of ‘intermediaries’ should be construed broadly so as to include all intermediaries ‘whose services are used by a third party to infringe an intellectual property right’. This encompasses intermediaries with no direct contractual relationship or connection with the infringer. Internet service providers (ISPs) are also considered to be intermediaries irrespective of the type of service they offer (mere conduit, caching or hosting) as well as online market places,344 search engines, social media forums345 or other internet platforms (see the discussion under paragraphs 12.167– 12.169 of Directive 2004/48 on Enforcement). Although it is a requirement that the service should be offered for remuneration in order to qualify for the safe harbours of Directive 2000/31 on E-Commerce (hereinafter E-Commerce Directive), it is immaterial whether the service is paid for directly by the user. 11.173 The Digital Single Market Directive (Directive 2019/709) adopts a similar definition of information society services and also defines ‘online content-sharing service providers’ as a sub-category of information society service providers, for which the special rules of this Directive apply. An online content-sharing service provider is, according to Article 2(6) of the Directive: a provider of an information society service of which the main or one of the main purposes is to store and give the public access to a large amount of copyright-protected works or other protected subject matter uploaded by its users, which it organises and promotes for profit-making purposes.

Although the Digital Single Market Directive does not affect the legal framework outlined in the E-Commerce Directive, and is merely meant to complement it, online content-sharing providers are expected to be subject to two systems of liability: primary liability for possible infringements of the right of communication and making available to the public (discussed in the Chapter on the Digital Single Market Directive) and secondary liability for activities falling within the scope of the E-Commerce Directive.

344

See C-324/09 L’Oréal SA and Others v eBay International AG and Others [2011] ECR I-06011, according to which: The third sentence of Article 11 of Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights must be interpreted as requiring the Member States to ensure that the national courts with jurisdiction in relation to the protection of intellectual property rights are able to order the operator of an online marketplace to take measures which contribute, not only to bringing to an end infringements of those rights by users of that marketplace, but also to preventing further infringements of that kind. Those injunctions must be effective, proportionate, and dissuasive and must not create barriers to legitimate trade.

345

See also C-314/12 PC Telekabel Wien [2014] EUECJ C-314/12. The Opinion of the Advocate General in this case was delivered on 26.11.2013. C-360/10 BelgischeVereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV [2012] EUECJ C-360/10 in relation to a ‘hosting service provider’ (in the case at issue an online social networking platform where every person who registered acquired a personal space known as a ‘profile’ which the user could complete himself and which become available globally).

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B. Liability of internet service providers i.

No general obligation to monitor

Issues of liability of ISPs are dealt with under the E-Commerce Directive. In fact Articles 12–14 of 11.174 the E-Commerce Directive restrict the liability of ISPs in cases of mere conduit (Art. 12), caching (Art. 13) and hosting (Art. 14) by providing that Member States should not impose a general obligation on them to monitor the information they transmit or store or a general obligation actively to seek facts or circumstances indicating illegal activity (Art. 15(1)). According to Recital 47 of the E-Commerce Directive Member States are prevented from imposing 11.175 a monitoring obligation on service providers only with respect to obligations of a general nature. This does not concern monitoring obligations in specific cases and, in particular, does not affect orders by national authorities in accordance with national legislation. Therefore national systems providing for filtering by ISPs of particular sites either through court orders or orders by national authorities are in compliance with the E-Commerce Directive. Recent case law of the CJEU on the issue of general filtering was very instructive in this respect. In 11.176 Scarlet 346 the CJEU ruled that the relevant EU Directives – if read together and construed in the light of the requirements stemming from the protection of the applicable fundamental rights – must be interpreted as precluding the imposition of an injunction against an ISP, which requires it to install a system to filter all electronic communications passing via its services (in particular, those involving the use of peer-to-peer software), which (i) applies indiscriminately to all its customers, as a preventive measure, exclusively at its expense, and for an unlimited period; and (ii) is capable of identifying on that provider’s network the movement of electronic files containing a musical, cinematographic or audiovisual work in respect of which the applicant claims to hold intellectual property rights, with a view to blocking the transfer of files the sharing of which infringes copyright. The same outcome was reached in the Netlog case in relation to a ‘hosting service provider’.347 There are numerous systems in the EU providing for various forms of measures to be taken by ISPs 11.177 either on the basis of court orders or on the basis of orders originating from national authorities. Some of them have to do with the suspension or limitation of access to the internet or filtering. On the basis of the EU Telecom Package not only judicial authorities but also other authorities may impose measures with regard to end-users’ access to, or use of, services and applications through electronic communications networks.348

346 347 348

Case C-70/10 Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) [2011] ECR I-11959. C-360/10 Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV [2012] EUECJ C-360/10. Amendment 46 (ex 138) of the Telecom Package (Dir. 2009/140/EC of the European Parliament and of the Council of 25 November 2009 amending Dirs 2002/21/EC on a common regulatory framework for electronic communications networks and services, 2002/19/EC on access to, and interconnection of, electronic communications networks and associated facilities, and 2002/20/EC on the authorization of electronic communications networks and services (OJ L 337/37, 18.12.2009), which amends Art. 1(3a) of Dir. 2002/22/EC of the European Parliament and of the Council of 7 March 2002 on universal service and users’ rights relating to electronic communications networks and services, which amends Art. 1 para. 3a) of Dir. 2002/22/EC of the European Parliament and of the Council of 7 Mar. 2002 on universal service and users’ rights relating to electronic communications networks and services (Universal Service Directive): 3a. Measures taken by Member States regarding end-users’ access to or use of services and applications through electronic communications networks shall respect the fundamental rights and freedoms of natural persons, as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms and general principles of Community law. Any of these measures regarding end-users’ access to or use of services and applications through electronic communications networks liable to restrict those fundamental rights or freedoms may only be imposed if they are appropriate, proportionate and necessary within a democratic society, and their

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11.178 Examples of national systems concerning the role of ISPs in relation to intellectual property infringements are the French Hadopi Act,349 the UK Digital Economy Act (12.6.2010) and OFCOM Code of Obligations (July 2012), the Hungarian Notice and Take Down Act (Act 2001/108), the German Act (18.6.2009), the Irish Agreement between IRMA and EIRCOM (January 2009), the Dutch ‘Notice-and-Take-Down Code of Conduct’, the Spanish Law for Sustainable Economy (8.1.2010)350 and the Swedish Law (1.4.2009).351 11.179 With regard to criminal proceedings Recital 26 of the E-Commerce Directive provides that Member States, in conformity with conditions established in the Directive, may apply their national rules on criminal law and criminal proceedings with a view to taking all investigative and other measures necessary for the detection and prosecution of criminal offences, without there being a need to notify such measures to the Commission. It goes without saying that Member States may have provided (or may provide in the future) for criminal sanctions with regard to copyright and related rights infringement.352 No exception is made for those sanctions. Member States may apply them in their national laws. 11.180 Article 15(2) of the E-Commerce Directive provides for an exception to paragraph (1). Member States may establish (a) obligations for ISPs promptly to inform the competent public authorities of alleged illegal activities undertaken or information provided by recipients of their service or (b) obligations to communicate to the competent authorities, at their request, information enabling the identification of recipients of their service with whom they have storage agreements. Recital 48 of the E-Commerce Directive elaborates further on that by providing that this Directive does not affect the possibility for Member States requiring service providers, who host information provided by recipients of their service, to apply duties of care, which can reasonably be expected from them and which are specified by national law, in order to detect and prevent certain types of illegal activities. Although this provision allows Member States to provide an obligation for ISPs to

implementation shall be subject to adequate procedural safeguards in conformity with the European Convention for the Protection of Human Rights and Fundamental Freedoms and with general principles of Community law, including effective judicial protection and due process. Accordingly, these measures may only be taken with due respect for the principle of presumption of innocence and the right to privacy. A prior fair and impartial procedure shall be guaranteed, including the right to be heard of the person or persons concerned, subject to the need for appropriate conditions and procedural arrangements in duly substantiated cases of urgency in conformity with European Convention for the Protection of Human Rights and Fundamental Freedoms. The right to an effective and timely judicial review shall be guaranteed. 349 350

351

352

Hadopi II (Loi n° 2009–1311/28.10.2009). This law provides, amongst other issues, for the creation of an Intellectual Property Commission (IPC) that, together with a judge, will deal with complaints concerning alleged illegal downloading. This law will give the authorities the power to shut down file-sharing sites within a few days from the date on which the complaint is filed with IPC. The court is to decide within four days from that date whether a certain site is infringing the law or not. See http://www.edri.org/edrigram/number8.1/spain-law-file-sharing. See M.M. Frabboni, ‘File sharing and the role of intermediaries in the marketplace: National, European Union and international developments’; A. Strowel, ‘“The gradutated response” in France: Is it the good reply to online copyright infringements?’; V-L. Bénabou, ‘The chase: The French insight into the “three-strikes” system’, I. Stamatoudi, ‘Data protection, secrecy of communications and copyright: conflicts and convergences – the example of Promusicae v Telefonica ’, all in I. Stamatoudi (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law & Business, Alphen aan den Rijn, 2010, at 117, 147 163 and 199 respectively. See also I. Stamatoudi ‘ACTA, internet service providers and the acquis communautaire ’, in J. Rosén (ed.), Intellectual Property at the Crossroads of Trade, ATRIP Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2012, 237. See also the Report by the Hellenic Copyright Organisation concerning national laws and case law with regard to copyright infringements on the internet, www.opi.gr. Criminal sanctions are not harmonised (yet) at EU level. However, Member States are free to retain or introduce such sanctions into their national laws (see Art. 16 Dir. 2004/48 on Enforcement and the commentary on this article).

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communicate to the competent authorities – at their request – information enabling the identification of the recipients of their services, it does not introduce a general right of information. Such right is provided in Article 8 Directive 2004/48 on Enforcement.353 ii.

The three cases of limitation of ISPs’ liability (Arts 12–15 Dir. 2000/31 on E-Commerce)

Mere conduit takes place where the information society service provided consists of the transmis- 11.181 sion in a communication network of information provided by a recipient of the service, or the provision of access to a communication network on condition that the provider (a) does not initiate the transmission, (b) does not select the receiver of the transmission and (c) does not select or modify the information contained in the transmission (Art. 12(1)). The limitation of ISPs’ liability in this instance (Art. 12(1)) covers both the right of reproduction and the right of making available to the public. Providing access to the internet and the transmission of copyright and related rights material 11.182 through it requires intermediate storage. It would therefore be absurd to ‘clear’ liability for transmission and access and leave in intermediate storage. Therefore such transmission and provision of access (which include the automatic, intermediate and transient storage of the information transmitted insofar as this takes place for the sole purpose of carrying out the transmission in the communication network, and provided that the information is not stored for any period longer than is reasonably necessary for the transmission) is also exempted from liability on the basis of Article 12(2), which is also in conformity with Article 5(1) of the Information Society Directive. Such copies are irrelevant from a copyright point of view. Therefore when ISPs’ services are merely passive (i.e. ISPs play the role of ‘access providers’ only 11.183 and are not involved in either the selection of the information transmitted or the transmission process itself by initiating it or selecting the recipients) ISPs are exempted from any liability.354 ‘Caching’ takes place where the information society service provided consists of the transmission in 11.184 a communication network of information provided by a recipient of the service and where the automatic, intermediate and temporary storage of that information is performed for the sole purpose of making more efficient the information’s onward transmission to other recipients of the service upon their request, on condition that (a) the provider does not modify the information, (b) the provider complies with conditions on access to the information, (c) the provider complies with rules regarding the updating of the information, specified in a manner widely recognised and used by industry, (d) the provider does not interfere with the lawful use of technology, widely recognised and used by industry, to obtain data on the use of the information, and (e) the provider acts expeditiously to remove or to disable access to the information it has stored upon obtaining actual knowledge of the fact that the information at the initial source of the transmission has been

353 354

For details on the right of information in relation to ISPs see the commentary on Art. 8 Dir. 2004/48 on Enforcement. See also Recital 43 of the E-Commerce Directive according to which: [a] service provider can benefit from the exemptions for ‘mere conduit’ and for ‘caching’ when he is in no way involved with the information transmitted; this requires among other things that he does not modify the information that he transmits; this requirement does not cover manipulations of a technical nature which take place in the course of the transmission as they do not alter the integrity of the information contained in the transmission. For an overview of the regulatory framework in Europe see C. Angelopoulos, European Intermediary Liability in Copyright, Kluwer Law International, 2016; J. Riordan, The Liability of Internet Intermediaries, Oxford University Press, 2016; M. Husovec, Injunctions Against Intermediaries in the European Union: Accountable but not Liable, Cambridge University Press, 2017. See also I. Stamatoudi, ‘Copyright enforcement and the role of internet service providers’ in P. Torremans (ed.), The EU Enforcement Directive, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2014, at 789; I. Stamatoudi, ‘ACTA, internet service providers and the acquis communautaire ’, in Jan Rosén (ed.), Intellectual Property at the Crossroads of Trade, ATRIP Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2012, at 237.

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removed from the network, or access to it has been disabled, or that a court or an administrative authority has ordered such removal or disablement (Art. 13(1)).355 This case relates to the functionality of transmission/further transport of the information over digital networks. ‘Temporary storage’ seems to equal ‘temporary acts of reproduction’ as these are referred to under Article 5(1) of the Information Society Directive. However, it is not clear whether temporary storage always involves acts of reproduction, which are transient.356 11.185 ‘Hosting’ takes place where the information society service provided consists of the storage of information provided by a recipient of the service on condition that (a) the provider does not have actual knowledge of illegal activity or information and, as regards claims for damages, is not aware of facts or circumstances from which the illegal activity or information is apparent; or (b) the provider, upon obtaining such knowledge or awareness, acts expeditiously to remove or to disable access to the information.357 This does not apply when the recipient of the service is acting under the authority or the control of the provider.358 In Case C-238/08 Google France v Louis Vuitton [2010] EUECJ C-238/08 and Case C-324/09 L’Oréal v eBay [2011] ECR I-6011, the CJEU held that, even if it were established that a user had been engaged in infringing activity, the service provider would be exempt from liability if their conduct had been automatic, passive, and merely technical. By contrast, the provider would be liable if they had control over the illegal information. 11.186 Therefore the crucial point is whether the ISP had actual knowledge with regard to the infringing act. According to this writer’s view gross negligence would suffice.359 It is accepted that a communication network access provider, unlike internet website hosts, may not always be in a position to remove certain pieces of information or disable access to them at a later time, as affirmed in Case C-484/14 Tobias Mc Fadden v Sony Music Entertainment Germany GmbH [2016] EUECJ C-484/14. Although lack of actual knowledge is provided as a necessary prerequisite for exemption from liability in relation to ‘hosting’ Recital 42 brings the element of fault in, in relation to all acts enshrined in Articles 12–14, by providing that these activities should be of a mere technical, automatic and passive nature, which implies that the ISP has neither knowledge of, nor control over, the information, which is transmitted or stored. Again fault here is submitted to mean (‘actual’) knowledge or gross negligence. Useful in this respect is also Recital 44 of the E-Commerce Directive, which provides that a service provider – who deliberately collaborates with one of the recipients of his service in order to undertake illegal acts – goes beyond the activities of ‘mere conduit’ or ‘caching’ and as a result cannot benefit from the liability exemptions established for these activities. 11.187 In the aforementioned cases (mere conduit, caching and hosting) and if the requirements provided in the relevant articles are met, ISPs cannot be held directly (primary infringement) or indirectly (secondary infringement) liable for copyright or related rights infringement. Exemption of liability

355 356 357 358

359

Ibid., Recital 43. See von Lewinski and Walter, 1090. It goes without saying that Art. 5(1) of the Information Society Directive does not apply since such storage (i.e. reproduction) is generally not transient or incidental and does not form an integral part of a technological process. See a French case by the Court of Appeal of Bastia (24.09.2008) where the Court found that the owner of a website who posted hyperlinks on it that allowed the illegal downloading of files containing copyright material committed copyright infringement. The Court of Appeal dismissed the appellant’s claims that he was covered by the immunity conferred by the E-Commerce Directive because he acted as a (content) publisher and not merely as a hosting provider. See the French case Tiscali Media/Dargaud Lombard, Lucky Comics (Cour d’appel de Paris 4ème chambre, section A Arrêt, 07.06.2006) where the Court found that the hosting provider was negligent given the fact that the details declared to it by the infringer (in French ‘Nom: Bande, Prénom: Dessinée, Adresse: rue de la BD’) were such that should have attracted the attention of the (defendant) service provider. See also von Lewinski and Walter, 1091. Also see Case C-610/15 Stichting Brein v Ziggo BV and XS4All Internet BV [2017] EUECJ C-610/15.

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ARTICLE 8: SANCTIONS AND REMEDIES

extends to all claims for copyright or related rights infringement (including claims for damages and corrective measures). However, injunctive relief 360 and the right of information361 remain unaffected. To this the fact that the temporary acts of reproduction by intermediaries, which are transient or 11.188 incidental and form an integral and essential part of a technological process and whose sole purpose is to enable a transmission in a network between third parties, are exempted (from the reproduction right) under Article 5(1) of the Information Society Directive should be added.362 Therefore intermediaries cannot incur any (primary or secondary) liability with regard to such transmissions, which are considered irrelevant from a legal point of view. iii.

Injunctions against intermediaries

In all three cases (Arts 12(3), 13(2) and 14(3) E-Commerce Directive) courts or administrative 11.189 authorities, in accordance with Member States’ legal systems, may require an ISP to terminate or prevent an infringement. In relation to hosting (Art. 14(3)) Member States may also establish procedures governing the removal or disabling of access to information.363 Although these articles do not expressly refer to injunctive relief they are, however, wide enough to include it. Recital 16 of the Information Society Directive provides that its provisions are without prejudice to 11.190 the E-Commerce Directive. However, Member States, irrespective of the ISPs’ liability, are under an obligation to ensure that right holders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe a copyright or related right (Art. 8(3) Information Society Directive). This is so by reason of the fact (as is also provided in Recital 59 of the Information Society Directive) that in the digital environment the services of intermediaries are increasingly used by third parties for infringing activities and in many cases such intermediaries are best placed to bring such infringing activities to an end. Recital 45 of the E-Commerce Directive confirms that the limitations on ISPs’ liability do not affect the possibility of injunctions of different kinds. Such injunctions may consist of orders by courts or administrative authorities requiring the termination or prevention of any infringement, including the removal of illegal information or the disabling of access to it.364 Injunctions can prove very useful especially in cases where the right of information is ineffective, e.g. 11.191 in cases where the infringers cannot be found since they are established in a country outside the EU or in any forum that is not prepared to give the details of the infringer. This may also be the case within the EU on the basis of data protection, data retention and privacy laws.365

360 361 362 363 364

365

As provided under the Information Society Directive and the Enforcement Directive. As provided under the Enforcement Directive. As explained above such acts of reproduction may fall within ‘mere conduit’; and ‘caching’ but not ‘hosting’. In relation to ‘hosting’ Member States may provide for broader legislature (compared to ‘mere conduit’ and ‘caching’) concerning ISPs extending to corrective measures, too, as these measures are indicated under Art. 14(3). The date of implementation into national laws of the Information Society Directive and the E-Commerce Directive was co-ordinated on the basis of the connection of these two Directives (see Recital 16 of the Information Society Directive and Recital 50 of the E-Commerce Directive). Recent times have seen a rise in blocking injunctions and award of damages. See e.g. Twentieth Century Fox and others v British Telecommunications plc [2011] EWHC 1981 (Ch) (UK); Cartier International and Others v BSkyB and others [2014] EWHC 3354 (Ch) (UK); D.M. v APP, Microsoft, Sacem and others, Paris Court of Appeal, Pol 5, Ch 13, 7 June 2017 (France); First Instance Criminal Court of Paris, 2 April 2015 (France); for an overview of the legal framework governing blocking injunctions in Europe see C. Angelopoulos, ‘Are blocking injunctions against ISPs allowed in Europe? Copyright enforcement in the post-Telekabel EU legal landscape’ (2014) Journal of Intellectual Property Law & Practice 10, 812. See in Stamatoudi, 2010 – Frabboni, 117; Strowel, 147; Bénabou, 163; and Stamatoudi, 199. See also Stamatoudi, 2012, 237. See also Case C-461/10 Bonnier Audio AB, Earbooks AB, Norstedts Förlagsgrupp AB, Piratförlaget AB, Storyside AB v Perfect Communication Sweden AB, 19 April 2012, not yet published; C-557/07 LSG-Gesellschaft zur Wahrnehmung

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11.192 Injunctive relief provided under Article 8(3) of the Information Society Directive was extended to cover all intellectual property rights under Article 11 of the Enforcement Directive. In any case though (as provided in Art. 11(2)) obligations under Article 8(3) of the Information Society Directive remain unaffected. 11.193 Further issues were clarified in Case C-314/12 UPC Telekabel Wien where the Court of Justice held that Article 8(3) should be understood to mean that a person who makes protected subject matter available to the public on a website without the agreement of the right holder is using the services of the ISP of the persons accessing that subject matter, which must be regarded as an intermediary within the meaning of Article 8(3). In addition, the fundamental rights recognised by EU law do not preclude: a court injunction prohibiting an internet service provider from allowing its customers access to a website placing protected subject-matter online without the agreement of the rightholders when that injunction does not specify the measures which that access provider must take and when that access provider can avoid incurring coercive penalties for breach of that injunction by showing that it has taken all reasonable measures, provided that (i) the measures taken do not unnecessarily deprive internet users of the possibility of lawfully accessing the information available and (ii) that those measures have the effect of preventing unauthorised access to the protected subject-matter or, at least, of making it difficult to achieve and of seriously discouraging internet users who are using the services of the addressee of that injunction from accessing the subject-matter that has been made available to them in breach of the intellectual property right, that being a matter for the national authorities and courts to establish.366

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights signed on 15 April 1994 (TRIPS). Directive 2009/140/EC of the European Parliament and of the Council of 25 November 2009 amending Directive 2002/21/EC on a common regulatory framework for electronic communications networks and services, Directive 2002/19/EC on access to, and interconnection of, electronic communications networks and associated facilities, and Directive 2002/20/EC on the authorisation of electronic communications networks and services, OJ L 337/37, 18.12.2009. Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights, OJ L 157/45, 30.4.2004. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market, O J L 178/1, 17/07/2000. World Copyright Treaty (WCT) of 20 December 1996. WIPO Performances and Phonograms Treaty (WPPT) of 20 December 1996.

2. CJEU case law ACI Adam and Others (Case C-435/12) [2014] EUECJ C-435/12. Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV (Case C-360/10) [2012] EUECJ C-360/10. Bonnier Audio AB, Earbooks AB, Norstedts Förlagsgrupp AB, Piratförlaget AB, Storyside AB v Perfect Communication Sweden AB, (Case C-461/10) [2012] EUECJ C-461/10. Google France v Louis Vuitton (Case C-238/08) [2010] EUECJ C-238/08. L’Oréal SA and Others v eBay International AG and Others (Case C-324/09) [2011] ECR I-06011.

366

von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH [2009] ECR I-1227; Case C-275/06 Productores de Música de España (Promusicae) v Telefónica de España SAU [2008] ECR I-271. Case C-314/12 UPC Telekabel Wien [2014] EUECJ C-314/12.

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ARTICLE 9: CONTINUED APPLICATION OF OTHER LEGAL PROVISIONS LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH (Case C-557/ 07) [2009] ECR I-1227. Productores de Música de España (Promusicae) v Telefónica de España SAU (Case C-275/06) [2008] ECR I-271. Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) (Case C-70/10) [2011] ECR I-11959. Stichting Brein v Ziggo BV and XS4All Internet BV (Case C-610/15) [2017] EUECJ C-610/15. Tobias Mc Fadden v Sony Music Entertainment Germany GmbH (Case C-484/14) [2016] EUECJ C-484/14. UPC Telekabel Wien (Case C-314/12) [2014] EUECJ C-314/12.

3. Bibliography Angelopoulos, C. ‘Are blocking injunctions against ISPs allowed in Europe? Copyright enforcement in the post-Telekabel EU legal landscape’ (2014) 10 Journal of Intellectual Property Law & Practice 812. Angelopoulos, C. European Intermediary Liability in Copyright, Kluwer Law International, Alphen aan den Rijn, 2016. Bénabou, V.-L. ‘The Chase: The French insight into the ‘three-strikes’ system’, in Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law and Business, Alphen aan den Rijn, 2010. Frabboni, M.-M. ‘File sharing and the role of intermediaries in the marketplace: National, European Union and international developments’, in Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law and Business, Alphen aan den Rijn, 2010. Husovec, M. Injunctions Against Intermediaries in the European Union: Accountable but not Liable, Cambridge University Press, Cambridge, 2017. Karapapa, S. Defences to Copyright Infringement: Creativity, Innovation and Freedom on the Internet, Oxford University Press, Oxford, 2020. Riordan, J. The Liability of Internet Intermediaries, Oxford University Press, Oxford, 2016. Stamatoudi, I. ‘The Role of Internet Service Providers. Ethics, Reality and the Law: The Example of Promusicae v. Telefonica ’, in Botti, M. (ed.) 8th International Conference, Computer Ethics: Philosophical Enquiry, Ionio University, Corfu, 26–28 June 2009, Nomiki Vivliothiki, Athens, 2009, 750. Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Information Law Series (B. Hugenholtz (general editor), Wolters Kluwer Law & Business, Alphen aan den Rijn, 2010. Stamatoudi, I. ‘Data protection, secrecy of communications and copyright protection. conflicts and convergences. The example of Promusicae v. Telefonica’ in Stamatoudi, I. (ed), Copyright Enforcement and the Internet, Information Law Series (B. Hugenholtz (general editor)), Kluwer Law International, Alphen aan den Rijn, 2010, 199. Stamatoudi, I. ‘ACTA, internet service providers and the acquis communautaire ’ in Rosén, J. (ed.), Intellectual Property at the Crossroads of Trade, ATRIP Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2012, 237. Stamatoudi, I. ‘Towards an updated EU enforcement Directive? Selected topics and problems’, 4th International Seminar on Information Law 2011, Aristotle University of Thessaloniki, University of Macedonia and Ionio University, Thessaloniki 19–22 May 2011, Nomiki Vivliothiki, e-book. Stamatoudi, I. ‘Copyright enforcement and the role of internet service providers’ in Torremans, P. (ed.), The EU Enforcement Directive, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2014, 789. Strowel, A.“‘The Graduated Response” in France: Is it the good reply to online copyright infringements?’, in Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law and Business, Alphen aan den Rijn, 2010. von Lewinski, S. and M. Walter, ‘Information Society Directive’, in von Lewinski, S. and M. Walter (eds), European Copyright Law, Oxford University Press, Oxford, 2010. See also Bibliography at Art. 4.

ARTICLE 9: CONTINUED APPLICATION OF OTHER LEGAL PROVISIONS This Directive shall be without prejudice to provisions concerning in particular patent rights, trade marks, design rights, utility models, topographies of semi-conductor products, type faces,

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conditional access, access to cable of broadcasting services, protection of national treasures, legal deposit requirements, laws on restrictive practices and unfair competition, trade secrets, security, confidentiality, data protection and privacy, access to public documents, the law of contract.

SELECTED RECITALS (60) The protection provided under this Directive should be without prejudice to national or Community legal provisions in other areas, such as industrial property, data protection, conditional access, access to public documents, and the rule of media exploitation chronology, which may affect the protection of copyright or related rights.

I. COMMENTARY 11.194 Article 9 reiterates a rule found in a number of other EU Directives (e.g. Art. 9 Directive 91/250 on Computer Programs, Art. 14 Directive 2006/115 on Rental and Lending Rights (codification of 1992/100), Art. 9 Directive 2011/77 on the Term of Protection (amending 2006/116, which codified 1993/98)) and was modelled on Article 13 Directive 96/9 on Databases. The Information Society Directive does not affect any other EU provision or national provisions, which may overlap with those enshrined in it. It also does not prejudice any other intellectual property rights, which are not regulated by this Directive. If an overlap is found the two (or more instruments) are supposed to work parallel to each other. And in any case EU law is not supposed to contain contradictions. Where such contradictions are visible though a fair balance should be struck between the various rights/interests involved.367 11.195 Article 9 refers to particular rights (such as patent rights, trade marks, design rights, utility models, topographies of semi-conductor products, type faces, conditional access, access to cable of broadcasting services, protection of national treasures, legal deposit requirements, laws on restrictive practices and unfair competition, trade secrets, security, confidentiality, data protection and privacy, access to public documents and the law of contract). The listing is indicative rather than exhaustive. This is also indicated by the fact that Recital 60 refers to ‘the rule of media exploitation chronology’, which is not found in the actual text of the Directive.

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights signed on 15 April 1994 (TRIPS). Council Directive 91/250/EEC of the European Parliament and of the Council of 14 May 1991 on the legal protection of computer programs, OJ L 122/42, 17.5.1991. Directive 1996/9/EC of the European Parliament and of the Council on the legal protection of databases, OJ L 77/20, 27.3.1996. Directive 2006/115 of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376, 27.12.2006.

367

See C-557/07 LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH [2009] ECR I-1227 and Case C-275/06 Productores de Música de España (Promusicae) v Telefónica de España SAU, [2008] ECR I-271 and so on regarding the balancing of fundamental rights such as the right to intellectual property and the right to privacy. See also ECtHR Neij and Sunde Kolmisoppi v Sweden case (App no. 40397/12) – 19.2.2013, where the Court found that file-sharing of copyright material is covered by the freedom of expression but national courts had rightly weighed the conflicting interests, the transmission and receipt of information and the protection of intellectual property when they condemned the applicants (founders of ‘The Pirate Bay’).

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ARTICLE 10: APPLICATION OVER TIME Directive 2011/77/EU of the European Parliament and of the Council of 27 September 2011, amending Directive 2006/116/EC on the term of protection of copyright and certain related rights, OJ L 265/1, 11.10.2011.

2. CJEU case law LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v. Tele2 Telecommunication GmbH (Case C-557/ 07) [2009] ECR I- 1227. Productores de Música de España (Promusicae) v. Telefónica de España SAU (Case C-275/06) [2008] ECR I-271.

ARTICLE 10: APPLICATION OVER TIME 1.

2.

The provisions of this Directive shall apply in respect of all works and other subjectmatter referred to in this Directive which are, on 22 December 2002, protected by the Member States’ legislation in the field of copyright and related rights, or which meet the criteria for protection under the provisions of this Directive or the provisions referred to in Article 1(2). This Directive shall apply without prejudice to any acts concluded and rights acquired before 22 December 2002.

I. COMMENTARY According to Article 10(1) (following the paradigm of earlier Directives) the Directive applies to all 11.196 works or subject matter referred to in this Directive, which are protected by the laws of the Member States, on 22 December 2002 (i.e. the ultimate date of the implementation of the Directive) or which meet the criteria for such protection under the provisions of the Directive including the provisions referred to under Article 1(2). The Directives referred to under Article 1(2) are (a) Directive 1991/250 on Computer Programs, (b) Directive 2006/115 on Rental and Lending Rights (codification of 1992/100), (c) Directive 1993/83 on Satellite and Cable, (d) Directive 2011/77 on the Term of Protection (amending 2006/116, which codified 1993/98), and (e) Directive 1996/9 on Databases. According to Article 10(2) the Directive applies to any acts concluded (including licence or any type 11.197 of (exclusive or non-exclusive) exploitation contracts or agreements) or rights acquired before 22 December 2002.

NOTES 1. Related instruments Council Directive 91/250/EEC of the European Parliament and of the Council of 14 May 1991 on the legal protection of computer programs, OJ L 122/42, 17.5.1991. Council Directive 93/98/EEC of 29 October 1993 harmonising the term of protection of copyright and certain related rights, OJ L 290/9, 24.11.1993. Directive 1996/9/EC of the European Parliament and of the Council of on the legal protection of databases, OJ L 77/20, 27.3.1996. Directive 2006/115 of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376, 27.12.2006. Directive 2011/77/EU of the European Parliament and of the Council of 27 September 2011, amending Directive 2006/116/EC on the term of protection of copyright and certain related rights, OJ L 265/1, 11.10.2011.

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ARTICLE 11: TECHNICAL ADAPTATIONS 1.

2.

Directive 92/100/EEC is hereby amended as follows: (a) Article 7 shall be deleted; (b) Article 10(3) shall be replaced by the following: “3. The limitations shall only be applied in certain special cases which do not conflict with a normal exploitation of the subject-matter and do not unreasonably prejudice the legitimate interests of the rightholder.” Article 3(2) of Directive 93/98/EEC shall be replaced by the following: “2. The rights of producers of phonograms shall expire 50 years after the fixation is made. However, if the phonogram has been lawfully published within this period, the said rights shall expire 50 years from the date of the first lawful publication. If no lawful publication has taken place within the period mentioned in the first sentence, and if the phonogram has been lawfully communicated to the public within this period, the said rights shall expire 50 years from the date of the first lawful communication to the public.” However, where through the expiry of the term of protection granted pursuant to this paragraph in its version before amendment by Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society the rights of producers of phonograms are no longer protected on 22 December 2002, this paragraph shall not have the effect of protecting those rights anew.

SELECTED RECITALS (61) In order to comply with the WIPO Performances and Phonograms Treaty, Directives 92/100/EEC and 93/98/EEC should be amended.

RELATED LEGAL INSTRUMENTS WIPO PERFORMANCES AND PHONOGRAMS TREATY ARTICLE 17(2): WPPT I. COMMENTARY 1. Article 11(1) 11.198 Article 11(1)(a) concerns amendments to Directive 1992/100 on Rental and Lending Rights (later codified as Dir. 2006/115). Article 7 of Directive 1992/100 on Rental and Lending Rights, which granted a right of reproduction to performers and other related rights’ holders, is deleted and replaced by the general provision of Article 2 of the Information Society Directive, which now equally applies to related right holders (provided in the Directive). 11.199 Article 10(3) of Directive 1992/100 on Rental and Lending Rights is repealed (by Art. 11(1)(b)) so that the three-step test368 can be introduced for related right holders, too.

368

See also Art. 5(2)(b) Dir. 2001/29 on the Information Society.

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ARTICLE 12: FINAL PROVISIONS

2. Article 11(2) Article 11(2)(1) repeals Article 3(2) of Directive 1993/98 on the Term of Protection (later codified 11.200 as Dir. 2006/116 and then amended as Dir. 2011/77) so as to align the term of protection for producers of phonograms with Article 17(2) WPPT. The point of calculation of the term of protection before the amendment was the fixation of the phonogram or its communication to the public, whilst after the amendment it is the time of publication rather than its communication to the public. However, if a phonogram is not published within a period of 50 years from fixation but is communicated to the public it is this later date, which constitutes the point of calculation. This amendment is linked to a transitional rule (Art. 11(2)(2)) according to which if the protection 11.201 of a phonogram has expired before 22 December 2002 (i.e. the ultimate date of the implementation of the Directive and therefore amendment of Art. 3(2) of Dir. 1993/98 on the Term of Protection) it does not revive.

ARTICLE 12: FINAL PROVISIONS 1.

2. 3.

4.

Not later than 22 December 2004 and every three years thereafter, the Commission shall submit to the European Parliament, the Council and the Economic and Social Committee a report on the application of this Directive, in which, inter alia, on the basis of specific information supplied by the Member States, it shall examine in particular the application of Articles 5, 6 and 8 in the light of the development of the digital market. In the case of Article 6, it shall examine in particular whether that Article confers a sufficient level of protection and whether acts which are permitted by law are being adversely affected by the use of effective technological measures. Where necessary, in particular to ensure the functioning of the internal market pursuant to Article 14 of the Treaty, it shall submit proposals for amendments to this Directive. Protection of rights related to copyright under this Directive shall leave intact and shall in no way affect the protection of copyright. A contact committee is hereby established. It shall be composed of representatives of the competent authorities of the Member States. It shall be chaired by a representative of the Commission and shall meet either on the initiative of the chairman or at the request of the delegation of a Member State. The tasks of the committee shall be as follows: (a) to examine the impact of this Directive on the functioning of the internal market, and to highlight any difficulties; (b) to organise consultations on all questions deriving from the application of this Directive; (c) to facilitate the exchange of information on relevant developments in legislation and case-law, as well as relevant economic, social, cultural and technological developments; (d) to act as a forum for the assessment of the digital market in works and other items, including private copying and the use of technological measures. (e) to examine the impact of the transposition of Directive (EU) 2019/790 on the functioning of the internal market and to highlight any transposition difficulties; (f) to facilitate the exchange of information on relevant developments in legislation and case law as well as on the practical application of the measures taken by Member States to implement Directive (EU) 2019/790; (g) to discuss any other questions arising from the application of Directive (EU) 2019/ 790.

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I. COMMENTARY 1.

Article 12(1)

11.202 Article 12(1) provides for the Commission’s obligation – as this obligation is provided in other Directives, too – to report to the European Parliament, the Council and the Economic and Social Committee on the application of the Directive on the basis of specific information supplied by the Member States. Yet, most Member States failed to implement the Directive on time.369 This is assumed to be one of the reasons why the Commission’s Report (which was a preliminary report) was only submitted almost three years later than circumscribed in this article, i.e. on 30 November 2007 instead of 22 December 2004.370 The Report was rather limited and dealt with the application of Articles 5, 6 and 8 in the light of the developments in the digital market and an assessment on how these articles were transposed by the Member States and applied by the national courts.

2. Article 12(2) 11.203 Article 12(2) reiterates the premise found in international conventions (i.e. Art. 1 of the Rome Convention and Article 1(2) WPPT) and EU law (i.e. Art. 14 Dir. 2006/115 on Rental and Lending Rights) that related rights’ protection (and in the case at issue the protection provided under Articles 2, 3(2) and 6–8) is independent from and leaves intact copyright protection since the two types of protection serve different interests and goals. Copyright protects creativity whilst related rights protection protects effort, investment and achievement.

3. Article 12(3) and (4) 11.204 Article 12(3) provides for the establishment of a ‘contact committee’. This Committee consists of representatives of the competent authorities of the Member States and is chaired by a representative of the Commission. It meets either on the initiative of the chairman or at the request of the delegation of a Member State. 11.205 The tasks of the Committee are set out in Article 12(4): (a) to examine the impact of the Directive on the functioning of the internal market and highlight potential difficulties; (b) to organise consultations on all questions deriving from the application of the Directive; (c) to facilitate the exchange of information on relevant developments in legislation and case law, as well as relevant economic, social, cultural and technological developments; and (d) to act as a forum for the assessment of the digital market in works and other items, including private copying and the use of technological measures. 11.206 Following the introduction of the Digital Single Market Directive (Directive 2019/790), three new tasks were allocated to the Committee. These include (e) the examination of the impact of the transposition of the Digital Single Market Directive on the functioning of the internal market and to highlight any transposition difficulties; (f) the facilitation of the exchange of information on relevant developments in legislation and case law as well as on the practical application of the measures taken by Member States to implement the Digital Single Market Directive; and the discussion of other questions arising from the application of the Digital Single Market Directive.

369 370

See the Commentary under Art. 13. Commission Staff Working Document. Report to the Council, the European Parliament and the Economic and Social Committee on the application of Directive 2001/29/EC on the harmonization of certain aspects of copyright and related rights in the information society, 30.11.2007 SEC (2007) 1556.

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ARTICLE 15: ADDRESSEES

ARTICLE 13: IMPLEMENTATION 1.

2.

Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive before 22 December 2002. They shall forthwith inform the Commission thereof. When Member States adopt these measures, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods of making such reference shall be laid down by Member States. Member States shall communicate to the Commission the text of the provisions of domestic law which they adopt in the field governed by this Directive.

I. COMMENTARY Member States had to implement the Directive before 22 December 2002 (18 months after its 11.207 adoption in May 2001). This deadline was only met by Denmark and Greece. Italy and Austria implemented the Directive in April and June 2003 respectively. The Commission decided to send reasoned opinions to the other 11 Member States (Belgium, Germany, Spain, France, Ireland, Luxembourg, the Netherlands, Portugal, Finland, Sweden and the UK).371 After that the Commission lodged proceedings for failure to implement the Directive against eight ‘old’ Member States, Belgium, Finland, France, the Netherlands, Portugal, Spain, Sweden and the UK for the territory of Gibraltar.372 Proceedings were also lodged against Luxembourg but were closed as Luxembourg implemented the Directive in April 2004.373

ARTICLE 14: ENTRY INTO FORCE This Directive shall enter into force on the day of its publication in the Official Journal of the European Communities.

I. COMMENTARY The Directive was published in the Official Journal on 22 June 2001 ([2001] OJ L167/10) and (as 11.208 provided in Art. 14) entered into force on that day.

ARTICLE 15: ADDRESSEES This Directive is addressed to the Member States.

371 372 373

IP/03/1005. IP/03/1752. For France see also IP/06/14. For France, Finland, Spain and the Czech Republic being sent a formal notice by the Commission see IP/05/921. IP/01/528.

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Chapter 11 THE INFORMATION SOCIETY DIRECTIVE

I. COMMENTARY 11.209 The Directive is binding upon Member States (Art. 249(3) EC Treaty) as well as upon EEA Member States (Annex 17 No. 9(e) to the EEA Agreement), i.e. Iceland, Lichtenstein and Norway.

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12 THE ENFORCEMENT DIRECTIVE Irini Stamatoudi and Olivier Vrins DIRECTIVE 2004/48/EC, 30.04.2004 of the European Parliament and of the council of 29 April 2004 on the enforcement of intellectual property rights

[2004] OJ L 157/45 [Corrigendum to Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights (OJ L 195, 2.6.2004, pp. 16–25)] [Corrigendum to Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights (OJ L 204, 4.8.2007, p. 27)] [Statement by the Commission concerning Article 2 of Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights (OJ L 94, 13.4.2005, p. 37)] I.

COMMENTARY 1. Introduction A. Historical background B. Policy reasons and timing C. Procedural steps

12.01 12.01 12.01 12.02 12.05

CHAPTER II: MEASURES, PROCEDURES AND REMEDIES SECTION 1: GENERAL PROVISIONS ARTICLE 3: GENERAL OBLIGATION

CHAPTER I: OBJECTIVE AND SCOPE

I.

ARTICLE 1: SUBJECT MATTER

ARTICLE 4: PERSONS ENTITLED TO APPLY FOR THE APPLICATION OF THE MEASURES, PROCEDURES AND REMEDIES

I.

COMMENTARY 1. ‘Measures, procedures and remedies’ 2. ‘Intellectual property rights’

12.06 12.06 12.07

I.

ARTICLE 2: SCOPE I.

COMMENTARY 1. Article 2(1) A. ‘Any infringement’ B. ‘Intellectual property rights’ 2. Article 2(2) and (3) A. General reservation term with regard to other EU and international obligations B. ‘Intermediaries’

12.10 12.10 12.10 12.15 12.16

12.16 12.21

COMMENTARY

12.23

COMMENTARY 1. Introduction 2. Article 4(a) and ‘holders’ of intellectual property rights 3. Article 4(b) and ‘all other persons authorised to use those rights’ 4. Article 4(c) and (d) A. ‘Intellectual property collective rights-management bodies’ and ‘professional defence bodies’ B. ‘Regularly recognised as having a right to represent holders of intellectual property rights’

12.29 12.29 12.33 12.36 12.39

12.39

12.40

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Chapter 12 THE ENFORCEMENT DIRECTIVE C. ‘In so far as permitted by and in accordance with the provisions of the applicable law’

12.43

ARTICLE 5: PRESUMPTION OF AUTHORSHIP OR OWNERSHIP I.

4. Article 8(3) 12.117 5. Conflicts between copyright protection and privacy in the light of the case law of the CJEU concerning ISPs 12.127

COMMENTARY 1. Introduction 2. ‘Author’ 3. ‘On the work in the usual manner’ 4. ‘Holders of rights related to copyright’

12.44 12.44 12.46 12.50 12.52

SECTION 4: PROVISIONAL AND PRECAUTIONARY MEASURES ARTICLE 9: PROVISIONAL AND PRECAUTIONARY MEASURES I.

COMMENTARY 1. Introduction 2. Injunctions against ‘intermediaries’ 3. Seizure of goods 4. Precautionary seizure of assets to secure financial claims

SECTION 2: EVIDENCE ARTICLE 6: EVIDENCE I.

COMMENTARY 1. Introduction 2. Article 6(1) A. The terms ‘party’ and ‘opposing party’ B. The nature of proceedings in the context of which the application is filed C. ‘Specified evidence’ D. ‘In the control of the opposing party’ E. ‘Reasonably available evidence sufficient to support its claims’ F. Sanctions G. Confidentiality H. Sampling 3. Article 6(2) A. ‘Infringement committed on a commercial scale’ B. ‘Banking, financial or commercial documents’ C. ‘Under the same conditions […] enable the competent judicial authorities to order, where appropriate’ D. ‘Party’ and ‘opposing party’ E. ‘Under the control of the opposing party’ F. ‘Confidentiality’

12.54 12.54 12.56 12.56

COMMENTARY 1. Introduction 2. Article 7(1) 3. Article 7(2) 4. Article 7(3) 5. Article 7(4) 6. Article 7(5)

COMMENTARY

12.160

ARTICLE 11: INJUNCTIONS I.

COMMENTARY 1. Introduction 2. Enforcing an injunction 3. Injunctions against intermediaries

ARTICLE 12: ALTERNATIVE MEASURES

12.77

ARTICLE 13: DAMAGES

I.

COMMENTARY

12.184

I.

COMMENTARY 1. Introduction 2. Article 13(1) A. Article 13(1)(a) B. Article 13(1)(b) 3. Article 13(2)

12.192 12.192 12.196 12.198 12.201 12.205

ARTICLE 14: LEGAL COSTS 12.85 12.86

I.

COMMENTARY

12.206

SECTION 7: PUBLICITY MEASURES ARTICLE 15: PUBLICATION OF JUDICIAL DECISIONS

12.87 12.87 12.88 12.100 12.101 12.102 12.105

I.

COMMENTARY

12.219

CHAPTER III: SANCTIONS BY MEMBER STATES ARTICLE 16: SANCTIONS BY MEMBER STATES I.

COMMENTARY

12.226

SECTION 3: RIGHT OF INFORMATION

CHAPTER IV: CODES OF CONDUCT AND ADMINISTRATIVE COOPERATION

ARTICLE 8: RIGHT OF INFORMATION

ARTICLE 17: CODES OF CONDUCT

I.

COMMENTARY 1. Introduction 2. Article 8(1) 3. Article 8(2)

12.169 12.169 12.174 12.176

SECTION 6: DAMAGES AND LEGAL COSTS

12.82 12.84

ARTICLE 7: MEASURES FOR PRESERVING EVIDENCE I.

ARTICLE 10: CORRECTIVE MEASURES

12.62 12.65 12.66 12.68 12.75

12.79

12.151

SECTION 5: MEASURES RESULTING FROM A DECISION ON THE MERITS OF THE CASE I.

12.57 12.59 12.61

12.129 12.129 12.142 12.148

12.106 12.106 12.109 12.116

I.

COMMENTARY

12.229

ARTICLE 18: ASSESSMENT I.

COMMENTARY

12.233

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I. COMMENTARY I.

ARTICLE 19: EXCHANGE OF INFORMATION AND CORRESPONDENTS I.

COMMENTARY

12.239

CHAPTER V: FINAL PROVISIONS

COMMENTARY

12.240

ARTICLE 21: ENTRY INTO FORCE I.

COMMENTARY

12.242

ARTICLE 22: ADDRESSEES

ARTICLE 20: IMPLEMENTATION

I. COMMENTARY 1. Introduction A. Historical background Directive 2004/48 on the enforcement of intellectual property rights (hereinafter the ‘Enforcement 12.01 Directive’ or the ‘Directive’), which came into force on 20 May 2004, although a compromise as are most EU Directives, is the most comprehensive piece of EU legislation when it comes to counterfeiting and piracy. It harmonises the minimum means available to right holders and public authorities for fighting infringements of intellectual property (IP) rights and establishes a general framework for exchanging information and administrative cooperation between national authorities and with the Commission.1 It is the only EU legal instrument which deals with all IP rights (copyright and industrial property rights) without any distinction between them encompassing even those that have not been harmonised at EU level. It also sets the basis for EU harmonisation in an area that had not been touched upon before. It covers both substantive and procedural rules though mainly targeted to the latter. Issues that are not covered although included in the initial proposal are criminal sanctions and technical protection measures. Issues that are not covered and for which there was no such intention from the start are rules applicable to judicial cooperation, judicial powers, the recognition and enforcement of decisions in civil and commercial matters and applicable national law. B. Policy reasons and timing The enactment of the Directive came as a response to the problem of counterfeiting and piracy that 12.02 tormented the EU as well as its Member States and other countries for decades. In fact the need for enactment of legislation in this area had been on the European Commission’s agenda since the 1980s and was reflected in the 1988 European Commission Green Paper.2 Limited provisions on enforcement were already found in Directive 2009/24 on computer programs3 and Directive 2001/29 on the information society4 but were not targeted to the issue and in any case they were not sufficient to tackle the general problem. The TRIPs Agreement5 was more meticulous on this issue 1

2 3

4 5

Report from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions. Application of Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004 on the enforcement of intellectual property rights (COM (2010) 779 final) (hereinafter Report I), at 2 and Commission Staff Working Document. Analysis of the application of Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004 on the enforcement of intellectual property rights in the Member States (SEC (2010) 1589 final) (hereinafter Report II), at 5. Specifically in the second chapter on ‘Piracy’. Green Paper on Copyright and the Challenge of Technology – Copyright Issues Requiring Immediate Action, COM (88) 172 final, 7.06.1988. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs (codified version of Council Directive of 14 May 1991 on the legal protection of computer programs [91/250/EEC], OJ L 122/42 of 17.5.1991), OJ L 111/16 of 5.5.2009. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10 of 22.6.2001. The 1994 Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPs Agreement), part of the multilateral trade agreements under the World Trade Organization (WTO).

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in contrast with the Berne Convention6 and the Paris Convention7 (as well as other WIPO administered international treaties), which while providing for substantive rights were silent on sanctions and remedies. The TRIPs Agreement contained an entire chapter on enforcement providing for, among others, access to justice, border measures, damages, seizure as well as provisional measures for IP infringements, which formed the basis for other international treaties that followed as well as for the Enforcement Directive. However, the TRIPs Agreement falls mainly within the class of measures intended as trade-related enforcement measures concerning the import and export of infringing goods and services into and from the EU rather than as internal enforcement measures aiming at safeguarding the functioning of the EU internal market. The Enforcement Directive’s aim is also made clear by the use of Article 95 EC Treaty (now Art. 114 TFEU)8 as the legal basis for its enactment.9 12.03 The EU also approaches the issue of enforcement from an additional point of view. Apart from the trade-related aspects with third countries, which are tackled within the framework of bilateral or multilateral trade agreements (e.g. TRIPs Agreement) and the EU legal framework for enforcement measures as part of the acquis communautaire, the EU is also concerned with the EU external borders with third countries where customs rules and practice become relevant.10 All these measures are equally important and should be approached in conjunction with each other.11 12.04 Although there was much controversy with regard to certain issues including the EU’s competence to legislate in this particular area, the enactment of the Enforcement Directive went rather fast.12 The reason for that was the fact that EU Member States had realised that there were gaps in the enforcement rules relating to substantive IP rights already harmonised in the EU and that there were no harmonised enforcement rules especially in IP law. EU Member States had also realised the need to combat counterfeiting and piracy and restore a safe EU environment capable of receiving investment and offering fair competition. Added to this fact was the momentum of the accession of ten new Member States (Eastern Enlargement – 1 May 2004) where such activities allegedly flourished. If this Directive were enacted soon enough, it would become part of the acquis communautaire with which these States would have to abide in order to become part of the EU. It was thus realised that this opportunity should not be missed.

C. Procedural steps 12.05 The issue of IP enforcement in the EU dates back many years. Two of the first instruments in this area were the Council Resolution of 24 July 1994 on measures to combat audiovisual pirating13 and

6 7 8

9 10 11

12 13

The 1886 Berne Convention for the Protection of Literary and Artistic Works. The 1883 Paris Convention for the Protection of Industrial Property. Under Part III of the Treaty entitled ‘Union Policies and Internal Actions’. It is worth noting that the European Community based the need for action in this field on the improvement of the functioning of the Internal Market rather than on the increase of the level of protection of IP rights in the EU. J. Reinbothe, ‘The EU Enforcement Directive 2004/48/EC as a tool for copyright enforcement’ in I. Stamatoudi (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law and Business, Alphen aan den Rijn, 2010, 3, 5–6. Ibid. Other EU initiatives have also been conducted in the area of IP infringements. Commission Communication of 16 July 2008: ‘An industrial property rights strategy for Europe’, COM (2008) 465 final; Commission Communication: ‘Enhancing the enforcement of intellectual property rights in the internal market’, COM (2009) 467 final. Council Resolution of 25 September 2008 on a comprehensive European anti-counterfeiting and anti-piracy plan, OJ C 253/1, 4.10.2008. Council Resolution of 1 March 2010 on the enforcement of intellectual rights in the internal market, OJ C 56/1, 6.3.2010. European Parliament, Resolution of 22 September 2010 on enforcement of intellectual property rights in the internal market (2009/2178(INI)), A7–0175/2010. The Directive was adopted 15 months after the Commission’s Proposal in one only reading of the European Parliament with vast majorities in all EU institutions involved in the process. OJ C 204/1 of 3.8.1984.

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I. COMMENTARY

the Product Piracy Regulation 199414 dealing with border measures. The issue was initially addressed in the 1998 EU Green Paper,15 which aimed to assess the economic impact of counterfeiting and piracy in the EU, review relevant existing legislation and assess the need for further action in the field. The Green Paper launched a consultation process. The Economic and Social Committee issued an opinion on 28 April 1999 endorsing the Commission’s proposal. The Commission’s proposal was also endorsed by the industry in a hearing held in March 1999 at the European Patent Office in Munich. In June 1999 the Commission published a Report on the responses to the Green Paper. On 4 May 2000 the European Parliament adopted a Resolution providing for deterring measures concerning IP enforcement as proposed in the 1998 Green Paper. On 30 November 2000 the Commission issued a Communication, which announced among other measures a Proposal for a Directive in the scope of an action plan that had to be executed as a matter of urgency. The Proposal would aim at (a) covering the enforcement of all intellectual property rights, including copyright and industrial property rights, irrespective of whether they were harmonised or not, (b) operating as a ‘TRIPs Plus’ element increasing the yardstick of enforcement in the EU, since Member States had already implemented the TRIPs provisions in their national laws and (c) working as a meaningful and effective tool in the area including copyright infringements in the digital environment.16 The Commission’s proposal was endorsed by the Economic and Social Committee in its Supplementary Opinion issued on 30 May 2001. On 30 January 2003 the Commission submitted its Proposal for a Directive. The Proposal did not focus on the combat of counterfeiting and piracy but rather followed a more general approach covering all intellectual property rights. The initial proposal differed from the final text that formed the Enforcement Directive in the following points: (a) the initial proposal included only harmonised or unitary IP rights. The final text included all IP rights irrespective of whether they were harmonised or not since any other approach was deemed to be impractical, especially in the area of copyright, (b) the initial proposal was intended to cover only acts of infringement conducted for commercial purposes or causing significant harm to the right holders, while the final text covered all acts of infringement, (c) the initial proposal included criminal sanctions, which were omitted from the final text of the Directive, and (d) the initial proposal included provisions against the circumvention of technical devices, which were also omitted from the final text of the Directive.17 Negotiations turned out to be difficult. On 29 October 2003 the Economic and Social Committee in its Opinion endorsed the proposal, making a number of remarks concerning the balancing of IP enforcement with other rights and interests such as the protection of bona fide consumers, the dissemination of knowledge, privacy and other legitimate rights of internet users. In fact it tried to effect a compromise between two different camps of ideas, one alleging that the proposal was not effective enough to combat large-scale criminal infringements, while the other alleged that it did not fully abide by consumers’ and private users’ rights. Negotiations in the European Parliament’s Committee on Legal Affairs and the Internal Market were conducted in the same spirit. On 5 December 2003 a draft report was issued by the European Parliament’s Legal Committee referring to an Opinion of the Committee on Industry, External Trade, Research and Energy. On the basis of these documents changes were made to the text of the proposal. On 16 February 2004 the Council’s Committee of Permanent Representatives (COREPER) submitted a compromise text with the most controversial issues

14

15 16 17

Council Regulation (EC) 3295/94 of 22 December 1994 laying down measures to prohibit the release for free circulation, export, re-export or entry for a suspensive procedure of counterfeit and pirated goods, OJ L 341/8, 30.12.1994. Regulation 3295/94 replaced Regulation (EEC) 3842/86, which only applied to counterfeit trademark goods. The latest instrument in the area (as of 1 January 2014) is Regulation (EU) 608/2013 of the European Parliament and of the Council of 12 June 2013 concerning customs enforcement of intellectual property rights and repealing Council Regulation (EC) 1383/2003, OJ L 181/15, 29.06.2013. Green Paper on Combating Counterfeiting and Piracy in the Internal Market, COM (98) 569 final, 15.10.1998. See also K. Huniar, ‘The Enforcement Directive – Its effects on UK law’, (2006) EIPR, 28(2), 92. Reinbothe, 9. M. Walter and D. Goebel, ‘Enforcement Directive’, in S. von Lewinski and M. Walter (eds), European Copyright Law, Oxford University Press, Oxford, 2010, 1206–7.

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(criminal sanctions and technical protection measures) being deleted while at the same time extending the scope of the Directive to all IP rights protected by the Member States’ national laws. On 9 March 2004 the European Parliament accepted the amended proposal at first reading with only minor changes. On 11 March 2004 at the Competitive Council’s meeting the Council confirmed this approval. The Directive was officially passed in the Council on 26 April 2004 and signed on 29 April 2004 by the Presidents of the European Parliament and the Council. In November 2004, the Enforcement Strategy towards third countries was adopted.18

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). Berne Convention for the Protection of Literary and Artistic Works, 9 September 1886, last amended on 28 September 1979. Commission Staff Working Document. Analysis of the application of Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004 on the enforcement of intellectual property rights in the Member States (SEC (2010) 1589 final). Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.6.2001. Regulation (EU) 608/2013 of the European Parliament and of the Council of 12 June 2013 concerning customs enforcement of intellectual property rights and repealing Council Regulation (EC) No 1383/2003, OJ L 181/15, 29.06.2013. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs, OJ L111/16, 5.6.2009. Green Paper of 7 June 1988 on Copyright and Challenge of Technology – Copyright Issues Requiring Immediate Action (COM (88)172 final). Green Paper of 15 October 1998 on Combating Counterfeiting and Piracy in the Internal Market (COM (98) 569 final). Guidance of 29 November 2017 on Certain Aspects of Directive 2004/48/EC of the European Parliament and of the Council on the enforcement of intellectual property rights (COM (2017) 708 final). Paris Convention for the Protection of Industrial Property, 20 March 1883, last amended on 28 September 1979. Report from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on the Application of Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004 on the enforcement of intellectual property rights (COM (2010) 779 final). WIPO Performances and Phonograms Treaty, 20 December 1996 (WPPT). WIPO Copyright Treaty (WCT), 20 December 1996.

2. Bibliography Huniar, K. ‘The Enforcement Directive – Its effects on UK law’ (2006) EIPR, 28(2), 92. Reinbothe, J. ‘The EU Enforcement Directive 2004/48/EC as a tool for copyright enforcement’, in Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law and Business, Alphen aan den Rijn, 2010. Walter, M. and D. Goebel, ‘Enforcement Directive’, in von Lewinski, S. and M. Walter (eds), European Copyright Law, Oxford University Press, Oxford, 2010. Wilman, F.G. ‘A decade of private enforcement of intellectual property rights under IPR Enforcement Directive 2004/48: where do we stand (and where might we go)?’ (2017) E.L. Rev., 42(4), 509.

18

[2005] OJ C 129/3.

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ARTICLE 1: SUBJECT MATTER

CHAPTER I OBJECTIVE AND SCOPE ARTICLE 1: SUBJECT MATTER This Directive concerns the measures, procedures and remedies necessary to ensure the enforcement of intellectual property rights. For the purposes of this Directive, the term ‘intellectual property rights’ includes industrial property rights.

SELECTED RECITAL (13) It is necessary to define the scope of this Directive as widely as possible in order to encompass all the intellectual property rights covered by Community provisions in this field and/or by the national law of the Member State concerned. Nevertheless, that requirement does not affect the possibility, on the part of those Member States which so wish, to extend, for internal purposes, the provisions of this Directive to include acts involving unfair competition, including parasitic copies, or similar activities.

I. COMMENTARY 1. ‘Measures, procedures and remedies’ The Directive uses this multiplicity of terms in order to refer comprehensively to all means provided 12.06 in it, which are necessary to ensure the enforcement of IP rights irrespective of the term used in the laws of the Member States as well as irrespective of whether they form part of their substantive or procedural law. These means (or else sanctions) are set out and regulated in detail in other provisions of the Directive as they form the main part of it (Arts 3 and 6–15). It should be noted that according to Article 16 of the Directive, and bearing in mind that the Directive provides for a minimum of harmonisation rather than a maximum, Member States are free to introduce additional sanctions or apply more effective/stricter ones if it is deemed appropriate.

2. ‘Intellectual property rights’ The Directive covers all IP rights irrespective of whether they are harmonised at EU level or 12.07 constitute unitary rights or not. It also covers rights provided in the national laws of the EU Member States without these rights being harmonised or provided in the EU legislation (see also Art. (2(1)). This is also irrespective of whether these rights were enshrined in the laws of a Member State before or appeared after the enactment of the Directive. It also covers IP rights that may be provided for in EU legislation after the enactment of the Directive. This broad definition of the term ‘intellectual property’ is also in conformity with the same term found in Article 133(5) of the EC Treaty concerning international negotiations on common commercial policy. It is also in conformity with Article 30 of the EC Treaty which – although it refers to ‘industrial and commercial property’ – also covers copyright and related rights. ‘Commercial property’ also covers trademarks, trade names or other equivalent rights.

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12.08 The Commission, in a Statement which appeared almost a year after the enactment of the Directive, sought to clarify this issue further.19 It provides for a list of IP rights covered by the Directive (copyright, rights related to copyright, sui generis right of a database maker, rights of the creator of the topographies of a semiconductor product, trademark rights, design rights, patent rights, including rights derived from supplementary protection certificates, geographical indications, utility model rights, plant variety rights and trade names insofar as these are protected as exclusive property rights in the national law concerned). This Statement, however, is not legally binding. Nor is the list it contains exhaustive.20 The reference to the fact that trade names are covered only insofar as these are protected as exclusive property rights in the national law of the Member State concerned means that the Directive is obligatory only for those IP rights that are provided as exclusive rights within its national law.21 This does not apply to the classic IP rights cited in the Commission’s Statement (such as copyright and related rights): these rights are covered fully since they are not found in the ‘grey area’ as trade names are. In other words, claims to equitable remuneration are also covered by the Directive such as the private copy levy or performers’ claims for equitable remuneration concerning the broadcasting of their works. Member States are free to extend this protection to other IP rights, but this is so only if they wish to. This is also the logic applying to acts involving unfair competition such as parasitic copies or similar activities. It is at the Member States’ discretion whether they shall extend the scope of the Directive to these activities too. 12.09 As far as trade secrets are concerned, the Enforcement Directive only applies to them insofar as its scope does not overlap with that of the Trade Secrets Directive;22 when the scope of both Directives overlaps, the Trade Secrets Directive takes precedence.23 Thus, any victim of an unlawful acquisition, use or disclosure of trade secrets, as defined in that Directive, will be able to benefit in the first place from the measures, procedures and remedies set out in the Trade Secrets Directive. For all the acts of unfair competition governed by national law that do not fall within the scope of the Trade Secrets Directive, the provisions of the Enforcement Directive will only be applicable if the Member State concerned decided to extend its application on the national level in line with Recital 13 of that Directive.

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). Regulation (EU) 608/2013 of the European Parliament and of the Council of 12 June 2013 concerning customs enforcement of intellectual property rights and repealing Council Regulation (EC) No 1383/2003, OJ L 181/15, 29.06.2013

19 20 21 22

23

Statement by the Commission concerning Article 2 of Directive 2004/48/EC of 29 April 2004 on the Enforcement of Intellectual Property Rights, OJ L 94/37, 13.4.2005. By contrast, Art. 2 of the Product Piracy Regulation 608/2013 contains a list which is both exhaustive and legally binding. See contra Walter and Goebel, 1213. Directive (EU) 2016/943 of the European Parliament and of the Council of 8 June 2016 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure, OJ L 157/1, 15.6.2016. Recital 39 of the Trade Secrets Directive provides: This Directive should not affect the application of any relevant law in other areas, including intellectual property rights and the law of contract. However, where the scope of application of Directive 2004/48/EC of the European Parliament and of the Council and the scope of this Directive overlap, this Directive takes precedence as lex specialis.

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2. CJEU case law ACI Adam BV and Others v Stichting de Thuiskopie and Stichting Onderhandelingen Thuiskopie vergoeding (Case C-435/12), ECLI:EU:C:2014:254. Coty Germany v Stadtsparkasse Magdeburg (Case C-580/13), ECLI:EU:C:2015:485. Diageo Brand BV v Simiramida-04 EOOD (Case C-681/13), ECLI:EU:C:2015:471.

3. Bibliography Blakeney, M. Trade Related Aspects of Intellectual Property Rights: A Concise Guide to the Trips Agreement, Sweet & Maxwell, 1996. Gervais, D. The TRIPS Agreement-Drafting History and Analysis, 2nd ed., Sweet & Maxwell, 2003. Harbottle, G. ‘Minimalism or mayhem? – The impact of the Enforcement Directive in the United Kingdom’ (2005) 148 March CW 22. Keplinger, M. ‘Enforcement of IP Rights in the Digital Environment: the Role of the World Intellectual Property Organization’ (2007) GRUR Int. 648. Lakits-Josse, A. ‘Directive 2004/48 of the European Parliament and of the Council of 29 April 2004 on the Enforcement of Intellectual Property Rights’ in Cottier, T. and P. Veron, Concise International and European IP Law, 2nd ed., Wolters Kluwer Law and Business, Alphen aan den Rijn, 2011. Reinbothe, J. ‘The EU Enforcement Directive 2004/48/EC as a tool for copyright enforcement’ in Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law and Business, Alphen aan den Rijn, 2010. Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law and Business, Alphen aan den Rijn, 2010. Walter, M. and D. Goebel, ‘Enforcement Directive’ in von Lewinski, S. and M. Walter (eds), European Copyright Law, Oxford University Press, Oxford, 2010.

ARTICLE 2: SCOPE 1.

2.

3.

Without prejudice to the means which are or may be provided for in Community or national legislation, in so far as those means may be more favourable for rightholders, the measures, procedures and remedies provided for by this Directive shall apply, in accordance with Article 3, to any infringement of intellectual property rights as provided for by Community law and/or by the national law of the Member State concerned. This Directive shall be without prejudice to the specific provisions on the enforcement of rights and on exceptions contained in Community legislation concerning copyright and rights related to copyright, notably those found in Directive 91/250/EEC and, in particular, Article 7 thereof or in Directive 2001/29/EC and, in particular, Articles 2 to 6 and Article 8 thereof. This Directive shall not affect: (a) the Community provisions governing the substantive law on intellectual property, Directive 95/46/EC, Directive 1999/93/EC or Directive 2000/31/EC, in general, and Articles 12 to 15 of Directive 2000/31/EC in particular; (b) Member States’ international obligations and notably the TRIPS Agreement, including those relating to criminal procedures and penalties; (c) any national provisions in Member States relating to criminal procedures or penalties in respect of infringement of intellectual property rights.

SELECTED RECITALS (4) At international level, all Member States, as well as the Community itself as regards matters within its competence, are bound by the Agreement on trade-related aspects of intellectual property (the TRIPS Agreement), approved, as part of the multilateral negotiations of the

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Uruguay Round, by Council Decision 94/800/EC and concluded in the framework of the World Trade Organization. (5) The TRIPS Agreement contains, in particular, provisions on the means of enforcing intellectual property rights, which are common standards applicable at international level and implemented in all Member States. This Directive should not affect Member States’ international obligations, including those under the TRIPS Agreement. (6) There are also international conventions to which all Member States are parties and which also contain provisions on the means of enforcing intellectual property rights. These include, in particular, the Paris Convention for the Protection of Industrial Property, the Berne Convention for the Protection of Literary and Artistic Works, and the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations. (7) It emerges from the consultations held by the Commission on this question that, in the Member States, and despite the TRIPS Agreement, there are still major disparities as regards the means of enforcing intellectual property rights. For instance, the arrangements for applying provisional measures, which are used in particular to preserve evidence, the calculation of damages, or the arrangements for applying injunctions, vary widely from one Member State to another. In some Member States, there are no measures, procedures and remedies such as the right of information and the recall, at the infringer’s expense, of the infringing goods placed on the market. (11) This Directive does not aim to establish harmonised rules for judicial cooperation, jurisdiction, the recognition and enforcement of decisions in civil and commercial matters, or deal with applicable law. There are Community instruments which govern such matters in general terms and are, in principle, equally applicable to intellectual property. (13) It is necessary to define the scope of this Directive as widely as possible in order to encompass all the intellectual property rights covered by Community provisions in this field and/or by the national law of the Member State concerned. Nevertheless, that requirement does not affect the possibility, on the part of those Member States which so wish, to extend, for internal purposes, the provisions of this Directive to include acts involving unfair competition, including parasitic copies, or similar activities. (14) The measures provided for in Articles 6(2), 8(1) and 9(2) need to be applied only in respect of acts carried out on a commercial scale. This is without prejudice to the possibility for Member States to apply those measures also in respect of other acts. Acts carried out on a commercial scale are those carried out for direct or indirect economic or commercial advantage; this would normally exclude acts carried out by end consumers acting in good faith. (15) This Directive should not affect substantive law on intellectual property, Directive 95/46/EC of 24 October 1995 of the European Parliament and of the Council on the protection of individuals with regard to the processing of personal data and on the free movement of such data, Directive 1999/93/EC of the European Parliament and of the Council of 13 December 1999 on a Community framework for electronic signatures and Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market. (16) The provisions of this Directive should be without prejudice to the particular provisions for the enforcement of rights and on exceptions in the domain of copyright and related rights set out in Community instruments and notably those found in Council Directive 91/250/EEC of 14

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May 1991 on the legal protection of computer programs or in Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society. (23) Without prejudice to any other measures, procedures and remedies available, rightholders should have the possibility of applying for an injunction against an intermediary whose services are being used by a third party to infringe the rightholder’s industrial property right. The conditions and procedures relating to such injunctions should be left to the national law of the Member States. As far as infringements of copyright and related rights are concerned, a comprehensive level of harmonisation is already provided for in Directive 2001/29/EC. Article 8(3) of Directive 2001/29/EC should therefore not be affected by this Directive. (28) In addition to the civil and administrative measures, procedures and remedies provided for under this Directive, criminal sanctions also constitute, in appropriate cases, a means of ensuring the enforcement of intellectual property rights.

I. COMMENTARY 1. Article 2(1) A. ‘Any infringement’ The measures, procedures and remedies provided for by the Directive only apply in proceedings 12.10 aiming to ensure that IP rights are protected. The Directive also covers IP infringements resulting from the breach of a contractual clause relating to the exploitation of an IP right, such as that of an author of a computer program.24 By contrast, it does not apply in proceedings aimed exclusively at the invalidation of such rights.25 Nor does it apply to proceedings entailing an action to pay compensation to copyright holders brought against collecting societies under Article 5(2)(b) of Directive 2001/29 on the information society.26 The final text of the Directive covers all acts of infringement and not only acts of infringement 12.11 carried out for commercial purposes or causing significant harm to the right holders as was intended in the initial proposal tabled by the Commission. There are, however, measures in the Directive, particularly Articles 6(2), 8(1) and 9(2), that apply only in respect of acts carried out on a commercial scale. There have been many views as to the specific scope of ‘infringement’ and it is very likely that 12.12 Member States will use their own legal traditions to define it. Any business carried out either by individuals or by legal entities is covered by the concept of 12.13 ‘infringement’, irrespective of the fact whether there is direct or indirect financial gain/benefit.

24 25 26

Case C-666/18, IT Development SAS v Free Mobile SAS, ECLI:EU:C:2019:1099, paras 36 and 49. Case C-180/11, Bericap Záródástechnikai Bt. v Plastinnova 2000 Kft., ECLI:EU:C:2012:717, paras 79–81. Judment in Case C-435/12, ACI Adam BV and Others v Stichting de Thuiskopie and Stichting Onderhandelingen Thuiskopie vergoeding, ECLI:EU:C:2014:254, para. 63. The Court recalled, at paras 61–62, that the provisions of the Enforcement Directive are not intended to govern all aspects of IP rights, but only those aspects inherent, first, in the enforcement of those rights and, secondly, in infringement of them, by requiring that there must be effective legal remedies designed to prevent, terminate or rectify any infringement of an existing IP right. Those provisions simply ensure the enforcement of the various rights enjoyed by the proprietors of IP rights, and cannot be interpreted as being intended to govern the various measures and procedures available to persons who are not themselves the proprietors of such rights, and which do not relate solely to an infringement of those rights. See also, in this regard, Case C-180/11 Bericap Záródástechnikai, ECLI:EU:C:2012:717, paras 75 and 77.

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‘Infringement’ should therefore be distinguished from ‘commercial scale infringement’. This is also irrespective of the fact whether the benefit accrues to the offender or third parties. Quantitative criteria do not apply. Thus, the multiplicity of actions, the size of the enterprise, the character and dimension of the acts, the number of infringing goods or services offered, the damage caused or the fact that the particular activity is not the party’s sole or core business activity, are irrelevant. 12.14 These provisions are obligatory for Member States. In the case of measures intended for ‘commercial scale’ infringements Member States are free to extend them to other infringements, too. The concept of ‘commercial scale’ is rather broadly defined in Recital 14 of the Directive (which copies part of it from Article 1(3) of Directive 2006/115 on Rental and Lending Rights). It refers to acts carried out for direct or indirect economic or commercial advantage, which would normally exclude acts carried out by end consumers acting in good faith. The term thus only excludes good faith private parties (end consumers), in other words private parties in their private (and not commercial) activity/capacity that (positively) believe that either they own a right or have a right to use a certain product or service even if there is some economic advantage from this act (e.g. they save the money they would spend if they bought the particular product). Users of BitTorrent sites up- or downloading IP-infringing content may not be considered ‘end consumers acting in good faith’ given the fact that it is very unlikely that the ‘good faith’ requirement applies to them. However, the notion of commercial scale seems to be narrower compared to the initial terms ‘acts carried out for commercial purposes’ or ‘cause significant harm to the rightholders’. The two latter terms would seem capable of applying to most IP infringements since most infringements would imply some form of commercial purpose or some form of significant harm.27 This would especially be so if infringements were committed with the use of new technologies, which allow the repetition or the multiplicity of infringements, which, if seen in a larger scale, may cause significant harm to right holders, such as the exchange of files (P2P) through the internet. In the Commission’s view, the notion of ‘commercial scale’ as used in the Directive should be interpreted and applied taking account of qualitative elements, such as the economic or commercial advantage that may be pursued by the infringements in question, as well as quantitative elements, such as the number and extent of the infringements.28 In any case, however, the ‘proportionality’ of the measure, which is each time at issue, will have to be assessed by the court. In the case, for example, of an application for disclosure of bank, financial or commercial documents (Art. 6(2)) the ‘appropriateness’ of the measure will also be assessed.

B. ‘Intellectual property rights’ 12.15 See the discussion under Article 1 at paragraphs 12.07 to 12.09. 2. Article 2(2) and (3) A. General reservation term with regard to other EU and international obligations 12.16 These two provisions (Art. 2(2)–(3)) set out in detail one basic principle that is valid for the whole of the Directive: the Directive is without prejudice to/leaves unaffected (a) any national provision

27

28

The term ‘commercial scale’ is understood and applied differently across the Member States. Some Member States have provided for the definition of this term (e.g. Germany, Czech Republic, Romania, Slovenia. In Italy scholars seem to conclude that ‘on a commercial scale’ means ‘in the course of trade’). The definition is often given by using the notion of ‘commercial purpose’ and defining it as ‘purposes aimed at direct or indirect economic or commercial gain’ or similar. In Germany they place the emphasis on the ‘number and severity of infringements’. These definitions are probably directly inspired by Recital 14 of the Directive. Report II, 9. Guidance of 29 November 2017 on Certain Aspects of Directive 2004/48/EC of the European Parliament and of the Council on the enforcement of intellectual property rights (COM (2017) 708 final) (hereinafter Guidance), at 9.

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which is more favourable towards IP protection, compared to the ones provided in the Directive,29 (b) any national provisions relating to criminal sanctions and penalties, (c) any other EU substantive IP obligation or EU enforcement provision, as well as (d) any international obligation. In paragraph 2 there is an express reference to Community legislation on copyright and related 12.17 rights and notably to Article 7 of Directive 2009/24 on computer programs and Articles 2–6 and 8 of Directive 2001/29 on the information society (see also Recital 16). Articles 2–5 contain substantive provisions which are not directly relevant to the Enforcement Directive. However, Article 6 refers to the protection of technological protection measures in relation to software. The reference is useful since the drafters of the Enforcement Directive wanted to point to the fact that the omission from the original text of the proposal of the provisions on technical protection measures does not signify any change in attitude towards existing provisions. On top of it, Member States are free to extend the measures laid down in the Enforcement Directive to other areas of IP protection, too, including the circumvention of technical protection measures. Paragraph 3 sets out another set of EU legal instruments, which the Directive leaves unaffected. 12.18 The express reference to those legal instruments at this point is perhaps dictated by the particular importance and relevance of these Directives to the Enforcement Directive. Thus, there is an express reference to the substantive EU IP legislation (i.e. to all relevant Directives and Regulations), to Directive 95/46 on the processing of personal data and its free movement (which has in the meantime been repealed and replaced by the General Data Protection Regulation),30 to Directive 99/93 on electronic signatures and to Directive 2000/31 on electronic commerce31 (Recital 15). The listing is not exhaustive but rather indicative since other relevant instruments, such as Directive 2002/58 on personal data and the protection of privacy in electronic communications,32 Regulation 867/2007 on the law applicable to non-contractual obligations (Rome II),33 Regulation 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Brussels I-bis)34 and Regulation 608/2013,35 are missed out. Issues relating to jurisdiction of courts, the recognition and enforcement of court decisions arising in the framework of IP infringement proceedings are to be decided in accordance with the Brussels I-bis Regulation. The Brussels I-bis Regulation, in particular, provides certain clarifications regarding the jurisdiction of courts with respect to the application of provisional measures based on Articles 6 and 7 of the Enforcement Directive in cross-border cases.36 The Rome II Regulation sets out rules on

29

30 31

32 33 34

35

36

See Case C-367/15 Stowarzyszenie ‘Oławska Telewizja Kablowa’ w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie, ECLI:EU:C:2017:36, para. 23: ‘Directive 2004/48 lays down a minimum standard concerning the enforcement of intellectual property rights and does not prevent the Member States from laying down measures that are more protective.’ C-275/06 Productores de Música de España (Promusicae) v Telefónica de España SAU, ECLI:EU:C:2008:54; C-580/13, Coty Germany v Stadtsparkasse Magdeburg, ECLI:EU:C:2015:485. C-324/09, L’Oréal SA and Others v eBay International AG and Others, ECLI:EU:C:2011:474; C-70/10 Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM), ECLI:EU:C:2011:771; C-360/10 Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV, ECLI:EU:C:2012:85. C-275/06 Productores de Música de España (Promusicae) v Telefónica de España SAU, ECLI:EU:C:2008:54. Regulation (EC) 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law applicable to non-contractual obligations, OJ L 199/40, 31.7.2007. Regulation (EU) 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, OJ L 351/1, 20.12.2012. See further Chapter 24 of this book regarding this Regulation. Regulation (EU) No 608/2013 of the European Parliament and of the Council of 12 June 2013 concerning customs enforcement of intellectual property rights and repealing Council Regulation (EC) No 1383/2003, OJ L 181/15, 29.06.2013. See further Chapter 21 of this book regarding this Regulation. Recital 25 of the Brussels I-bis Regulation clarifies that the notion of ‘provisional, including protective, measures’ within the meaning of, inter alia, Art. 35 of the Regulation includes, amongst others, protective orders aimed at preserving evidence as referred to in Arts 6 and 7 of the Enforcement Directive.

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the applicable law in respect of non-contractual obligations, which are often at issue in IP enforcement proceedings. 12.19 Paragraphs 2 and 3 indicate that the Enforcement Directive is not meant to work independently or irrespective of other EU obligations expressed through primary or secondary legislation. On the contrary, it is meant to work in conformity with them since EU legal instruments are meant to work either in conjunction with each other or else complement each other so that no conflict should arise. In case of conflict, however, the provisions of the Directives mentioned expressly in the Articles or Recitals of the Enforcement Directive as staying unaffected, prevail. Regarding the relationship between the Enforcement Directive and the Trade Secrets Directive, see paragraph 12.09. 12.20 In accordance with Recitals 5 and 6 and Article 2(3)(b) of the Directive, it is necessary, for the purpose of interpreting the Directive’s provisions, to take account of obligations on the Member States resulting from international agreements, including the TRIPs Agreement, the Berne Convention and the Rome Convention.37 The TRIPs Agreement is still to a large extent today the only international agreement providing for quite comprehensive means of enforcement relating to intellectual property infringements. Particular reference is made to the criminal sanctions provided in the TRIPs Agreement. The drafters of the Directive did not want the omission of criminal sanctions from the original proposal to be considered a setback in relation to their TRIPs obligations concerning criminal sanctions (see Recital 5 where the TRIPs Agreement provisions on the means of enforcing IP rights are considered to be common standards applicable at international level and implemented in all Member States). In the same spirit Recital 23 of the Directive provides that in addition to the civil and administrative measures, procedures and remedies provided for under this Directive, criminal sanctions also constitute, in appropriate cases, a means of ensuring the enforcement of IP rights.

B. ‘Intermediaries’ 12.21 Article 8 of Directive 2001/29 on the information society in its first two paragraphs provides for general sanctions and remedies as well as for the possibility for right holders to bring an action for damages and/or apply for an injunction and, where appropriate, for the seizure of infringing material as well as of devices, products or components where their interests are affected by an infringing activity. Paragraph 3 of the same Article provides that right holders should be in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe a copyright or related right. 12.22 This same principle is provided for in the Enforcement Directive. The concept of ‘intermediaries’ should be construed broadly so as to include all intermediaries ‘whose services are used by a third party to infringe an intellectual property right’. This encompasses intermediaries with no direct contractual relationship or connection with the infringer.38 Yet, this Article (Art. 2(2) and Recital 23) provides that the provision in Directive 2001/29 on the information society is not affected by the provisions of the Enforcement Directive. That means that in case of conflict between the two Directives, Directive 2001/29 on the information society prevails.39 Yet, since the Enforcement Directive was enacted having in mind Directive 2001/29, it can be assumed that the drafters of the

37 38 39

See Case C-367/15 Stowarzyszenie ‘Oławska Telewizja Kablowa’ w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie, ECLI:EU:C:2017:36, para. 24. Report I, 6. Reinbothe, 12.

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former have borne in mind the content of the latter. Thus the two Directives should work in conjunction with each other rather than against one another. For more information on intermediaries, see paragraphs 12.141 to 12.144, and Chapter 11 on the Information Society Directive, paragraphs 11.170–11.193.

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.6.2001. Directive 2006/115 of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, OJ L 376, 27.12.2006 as amended by Directive 2011/77. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs, OJ L 111/16, 5.6.2009. Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation), OJ L 119/1, 4.5.2016. See also Related instruments at Art. 1.

2. CJEU case law ACI Adam BV and Others v Stichting de Thuiskopie and Stichting Onderhandelingen Thuiskopie vergoeding (C-435/12), ECLI:EU:C:2014:254. Bayer Pharma AG v Richter Gedeon Vegyészeti Gyár Nyrt. and Others (C-688/17), ECLI:EU:C:2019:722. Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV (C-360/10), ECLI:EU: C:2012:85. Bericap Záródástechnikai Bt. v Plastinnova 2000 Kft. (C-180/11), ECLI:EU:C:2012:717. Coty Germany v Stadtsparkasse Magdeburg (C-580/13), ECLI:EU:C:2015:485. IT Development SAS v Free Mobile SAS (C-666/18), ECLI:EU:C:2019:1099. L’Oréal SA and Others v eBay International AG and Others (C-324/09), ECLI:EU:C:2011:474. LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH (C-557/07), ECLI:EU:C:2009:107. Productores de Música de España (Promusicae) v Telefónica de España SAU (C-275/06), ECLI:EU:C:2008:54. Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) (C-70/10), ECLI:EU: C:2011:771. Stowarzyszenie ‘Oławska Telewizja Kablowa’ w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie (C-367/15), ECLI:EU:C:2017:36. Tommy Hilfiger Licensing LLC and Others v Delta Center a.s. (C-494/15), ECLI:EU:C:2016:528.

3. Bibliography See Bibliography at Art. 1.

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CHAPTER II MEASURES, PROCEDURES AND REMEDIES SECTION 1 GENERAL PROVISIONS ARTICLE 3: GENERAL OBLIGATION 1.

2.

Member States shall provide for the measures, procedures and remedies necessary to ensure the enforcement of the intellectual property rights covered by this Directive. Those measures, procedures and remedies shall be fair and equitable and shall not be unnecessarily complicated or costly, or entail unreasonable time-limits or unwarranted delays. Those measures, procedures and remedies shall also be effective, proportionate and dissuasive and shall be applied in such a manner as to avoid the creation of barriers to legitimate trade and to provide for safeguards against their abuse.

SELECTED RECITALS (2) The protection of intellectual property should allow the inventor or creator to derive a legitimate profit from his/her invention or creation. It should also allow the widest possible dissemination of works, ideas and new know-how. At the same time, it should not hamper freedom of expression, the free movement of information, or the protection of personal data, including on the Internet. (12) This Directive should not affect the application of the rules of competition, and in particular Articles 81 and 82 of the Treaty. The measures provided for in this Directive should not be used to restrict competition unduly in a manner contrary to the Treaty. (14) The measures provided for in Articles 6(2), 8(1) and 9(2) need to be applied only in respect of acts carried out on a commercial scale. This is without prejudice to the possibility for Member States to apply those measures also in respect of other acts. Acts carried out on a commercial scale are those carried out for direct or indirect economic or commercial advantage; this would normally exclude acts carried out by end consumers acting in good faith. (15) This Directive should not affect substantive law on intellectual property, Directive 95/46/EC of 24 October 1995 of the European Parliament and of the Council on the protection of individuals with regard to the processing of personal data and on the free movement of such data (1), Directive 1999/93/EC of the European Parliament and of the Council of 13 December 1999 on a Community framework for electronic signatures (2) and Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market (3). (17) The measures, procedures and remedies provided for in this Directive should be determined in each case in such a manner as to take due account of the specific characteristics of that case, including the specific features of each intellectual property right and, where appropriate, the intentional or unintentional character of the infringement. (24) Depending on the particular case, and if justified by the circumstances, the measures, procedures and remedies to be provided for should include prohibitory measures aimed at preventing further infringements of intellectual property rights. Moreover there should be

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ARTICLE 41

corrective measures, where appropriate at the expense of the infringer, such as the recall and definitive removal from the channels of commerce, or destruction, of the infringing goods and, in appropriate cases, of the materials and implements principally used in the creation or manufacture of these goods. These corrective measures should take account of the interests of third parties including, in particular, consumers and private parties acting in good faith. (25) Where an infringement is committed unintentionally and without negligence and where the corrective measures or injunctions provided for by this Directive would be disproportionate, Member States should have the option of providing for the possibility, in appropriate cases, of pecuniary compensation being awarded to the injured party as an alternative measure. However, where the commercial use of counterfeit goods or the supply of services would constitute an infringement of law other than intellectual property law or would be likely to harm consumers, such use or supply should remain prohibited. (32) This Directive respects the fundamental rights and observes the principles recognised in particular by the Charter of Fundamental Rights of the European Union. In particular, this Directive seeks to ensure full respect for intellectual property, in accordance with Article 17(2) of that Charter.

RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT ENFORCEMENT OF INTELLECTUAL PROPERTY RIGHTS SECTION 1 GENERAL OBLIGATIONS ARTICLE 41 1.

2. 3.

4.

5.

Members shall ensure that enforcement procedures as specified in this Part are available under their law so as to permit effective action against any act of infringement of intellectual property rights covered by this Agreement, including expeditious remedies to prevent infringements and remedies which constitute a deterrent to further infringements. These procedures shall be applied in such a manner as to avoid the creation of barriers to legitimate trade and to provide for safeguards against their abuse. Procedures concerning the enforcement of intellectual property rights shall be fair and equitable. They shall not be unnecessarily complicated or costly, or entail unreasonable time-limits or unwarranted delays. Decisions on the merits of a case shall preferably be in writing and reasoned. They shall be made available at least to the parties to the proceeding without undue delay. Decisions on the merits of a case shall be based only on evidence in respect of which parties were offered the opportunity to be heard. Parties to a proceeding shall have an opportunity for review by a judicial authority of final administrative decisions and, subject to jurisdictional provisions in a Member’s law concerning the importance of a case, of at least the legal aspects of initial judicial decisions on the merits of a case. However, there shall be no obligation to provide an opportunity for review of acquittals in criminal cases. It is understood that this Part does not create any obligation to put in place a judicial system for the enforcement of intellectual property rights distinct from that for the

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enforcement of law in general, nor does it affect the capacity of Members to enforce their law in general. Nothing in this Part creates any obligation with respect to the distribution of resources as between enforcement of intellectual property rights and the enforcement of law in general.

SECTION 2 CIVIL AND ADMINISTRATIVE PROCEDURES AND REMEDIES ARTICLE 42: FAIR AND EQUITABLE PROCEDURES Members shall make available to right holders40 civil judicial procedures concerning the enforcement of any intellectual property right covered by this Agreement. Defendants shall have the right to written notice which is timely and contains sufficient detail, including the basis of the claims. Parties shall be allowed to be represented by independent legal counsel, and procedures shall not impose overly burdensome requirements concerning mandatory personal appearances. All parties to such procedures shall be duly entitled to substantiate their claims and to present all relevant evidence. The procedure shall provide a means to identify and protect confidential information, unless this would be contrary to existing constitutional requirements.

I. COMMENTARY 12.23 This is a rather general provision, which sets out the overall philosophy and scope within which the Enforcement Directive should operate. In this sense it draws upon and repeats to a large extent the wording found in other legislative instruments such as the TRIPs Agreement, the Product Piracy Regulation and Directive 2001/29 on the information society. 12.24 Article 3(1) provides that Member States shall provide for measures, procedures and remedies necessary to ensure the enforcement of IP rights. This provision signifies that Member States should adopt all these means irrespective of their nature (i.e. measures, procedures, remedies or other; the reference of terms is indicative). Also the obligation of Member States is substantial and not typical. The second sentence of the same paragraph refers to the fact that these means should be ‘fair and equitable and shall not be unnecessarily complicated or costly, or entail unreasonable time limits or unwarranted delays’. This phrase is a literal copying of paragraph 2 of Article 41 of the TRIPs Agreement. On the one hand, it is there to indicate effective means of enforcement in practice. It does not suffice to have the necessary legal provisions in place but also provides for the conditions that will allow these provisions to be applied effectively, especially through the judicial, administrative or other national system used for their implementation. On the other hand, it is there to disperse the fears of those fearing that the scope of the provisions by encompassing all sorts of infringements and not only those carried out on a commercial scale goes too far and may be used abusively. The fact that enforcement means must be ‘fair and equitable’ works as a necessary safeguard to any such abuse. 12.25 The content of such safeguards is indicated in the Recitals to the Directive by reference to particular cases such as the fact that freedom of expression, the free movement of information and the protection of personal data should not be hampered (Recital 2). Competition law should not be affected (Recital 12). Certain provisions of the Directive refer to acts carried out on a commercial scale only (i.e. Arts 6(2), 8(1) and 9(2)) (Recital 14). The means of enforcement should be determined in each case in such a manner as to take into account the specific characteristics of each

40

For the purpose of this Part, the term ‘right holder’ includes federations and associations having legal standing to assert such rights.

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case, including the specific features of the IP right at issue and, where appropriate, the intentional or unintentional character of the infringement (i.e. application of the principle of proportionality) (Recital 17). Also in relation to the application of corrective measures the interests of third parties including in particular, consumers and private parties acting in good faith, should be taken into account (Recital 24). In addition where an infringement is committed unintentionally and without negligence and where the corrective measures or injunctions would be disproportionate, Member States have the option to provide for pecuniary compensation being awarded to the injured party as an alternative measure (Recital 25). Lastly in Recital 32 there is a direct reference to the fact that the Directive respects fundamental 12.26 rights and principles recognised by the Charter of Fundamental Rights of the European Union. The rules set out in the Directive must, therefore, be interpreted and applied in such a manner that not only is the fundamental right to protection of intellectual property, enshrined in Article 17(2) of the Charter, safeguarded, but other fundamental rights at issue (such as the rights to effective judicial protection and to protection of privacy and personal data, as well as the freedom to conduct a business) are also fully considered and respected.41 In this regard, the CJEU has held on several occasions, in the context of litigation relating to copyright infringements, that, when deciding on right of information requests and the awarding of injunctions, for example, where various conflicting fundamental rights protected in the EU’s legal order are at stake, a fair balance must be struck between them, in light of the principle of proportionality.42 Article 3(2) provides that the measures, procedures and remedies must be effective, proportionate 12.27 and dissuasive. This is the wording found in Article 18 of the Product Piracy Regulation 3295/94 and Article 8(1) of Directive 2001/29 on the information society. It is, however, characteristic that the emphasis is placed on the effective nature of the means. Once effectiveness is stressed proportionality follows, while the sentence closes with another form of ‘effectiveness’, this being the fact that the means should also be dissuasive. The fact that these ‘measures, procedures and remedies shall be applied in such a manner so as to 12.28 avoid the creation of barriers to legitimate trade and to provide for safeguards against their abuse’ is a literal copying of Article 41(1) of the TRIPs Agreement and does not add anything new to what already applied before the enactment of the Directive. The fact that in the TRIPs Agreement reference is made to ‘procedures’ only instead of ‘measures, procedures and remedies’ is not an issue that carries any special weight.

41

In Cases C-275/06 Productores de Música de España (Promusicae) v Telefónica de España SAU and C-557/07 LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH, it has been provided in reference to Directives 2000/31, 2001/29, 2004/48 and 2002/58 that: […] Community law requires that, when transposing those directives, the Member States take care to rely on an interpretation of them, which allows a fair balance to be struck between the various fundamental rights protected by the Community legal order. Further, when implementing the measures transposing those directives, the authorities and courts of the Member States must not only interpret their national law in a manner consistent with those directives but also make sure that they do not rely on an interpretation of them which would be in conflict with those fundamental rights or with the other general principles of Community law, such as the principle of proportionality.

42

See, inter alia, Case C-275/06 Productores de Música de España (Promusicae) v Telefónica de España SAU, ECLI: EU:C:2008:54; Case C-557/07 LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH, ECLI:EU:C:2009:107; Case C-70/10, Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM), ECLI:EU:C:2011:771; Case C-360/10, Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV, ECLI:EU:C:2012:85; Case C-461/10 Bonnier Audio AB, Earbooks AB, Norstedts Förlagsgrupp AB, Piratförlaget AB, Storyside AB v Perfect Communication Sweden AB, ECLI:EU:C:2012:219; Case C-314/12, UPC Telekabel Wien GmbH v Constantin Film Verleih GmbH & Wega Filmproduktionsgesellschaft GmbH, ECLI:EU:C:2014:192; Case C-580/13, Coty Germany GmbH v Stadtsparkasse Magdeburg, ECLI:EU:C:2015:485; Case C-484/14, Tobias Mc Fadden v Sony Music Entertainment Germany GmbH, ECLI:EU:C:2016:689. See also further below concerning Arts 8, 9 and 11 of the Directive, and chapter 21, paras 21.155–21.173.

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NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.6.2001. See also related instruments at Art. 1.

2. CJEU case law Bastei Lübbe GmbH & Co. KG v Michael Strotzer (C-149/17), ECLI:EU:C:2018:841. Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV (C-360/10), ECLI: EU:C:2012:85. Coty Germany v Stadtsparkasse Magdeburg (C-580/13), ECLI:EU:C:2015:485. IT Development SAS v Free Mobile SAS (C-666/18), ECLI:EU:C:2019:1099. LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH (C-557/07), ECLI:EU:C:2009:107. Productores de Música de España (Promusicae) v Telefónica de España SAU (C-275/06), ECLI:EU:C:2008:54. Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) (C-70/10), ECLI:EU: C:2011:771. Tobias Mc Fadden v Sony Music Entertainment Germany GmbH (C-484/14), ECLI:EU:C:2016:689. UPC Telekabel Wien GmbH v Constantin Film Verleih GmbH & Wega Filmproduktionsgesellschaft GmbH (C-314/12), ECLI:EU:C:2014:192.

ARTICLE 4: PERSONS ENTITLED TO APPLY FOR THE APPLICATION OF THE MEASURES, PROCEDURES AND REMEDIES Member States shall recognise as persons entitled to seek application of the measures, procedures and remedies referred to in this chapter: (a) (b) (c) (d)

the holders of intellectual property rights, in accordance with the provisions of the applicable law; all other persons authorised to use those rights, in particular licensees, in so far as permitted by and in accordance with the provisions of the applicable law; intellectual property collective rights-management bodies which are regularly recognised as having a right to represent holders of intellectual property rights, in so far as permitted by and in accordance with the provisions of the applicable law; professional defence bodies which are regularly recognised as having a right to represent holders of intellectual property rights, in so far as permitted by and in accordance with the provisions of the applicable law.

SELECTED RECITAL (18) The persons entitled to request application of those measures, procedures and remedies should be not only the rightholders but also persons who have a direct interest and legal standing in so far as permitted by and in accordance with the applicable law, which may include professional organisations in charge of the management of those rights or for the defence of the collective and individual interests for which they are responsible.

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ARTICLE 42: FAIR AND EQUITABLE PROCEDURES

RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT ARTICLE 42: FAIR AND EQUITABLE PROCEDURES Members shall make available to right holders43 civil judicial procedures concerning the enforcement of any intellectual property right covered by this Agreement. Defendants shall have the right to written notice which is timely and contains sufficient detail, including the basis of the claims. Parties shall be allowed to be represented by independent legal counsel, and procedures shall not impose overly burdensome requirements concerning mandatory personal appearances. All parties to such procedures shall be duly entitled to substantiate their claims and to present all relevant evidence. The procedure shall provide a means to identify and protect confidential information, unless this would be contrary to existing constitutional requirements.

I. COMMENTARY 1. Introduction Article 4 describes the categories of persons (natural and legal) who are entitled to apply for the 12.29 application of the measures, procedures and remedies referred to in Chapter II of the Directive.44 It divides them into four main categories, which are more or less recognised in all Member States and links their legal standing for applying (locus standi) (with the exception of the first category referring to original right holders) to the provisions of the applicable law. While Article 4(a) provides that Member States are to recognise, in any case, holders of IP rights as persons entitled to seek application of the measures, procedures and remedies, Article 4(b) to (d) states that it is only insofar as permitted by, and in accordance with, the provisions of the applicable law that Member States may recognise other persons, as well as certain specific bodies, as having the same standing. Original right holders (Art. 4(a)), licensees and their successors in title (Art. 4(b)), collecting 12.30 societies (Art. 4(c)) and professional organisations (Art. 4(d)) are all entitled to and can invoke the enforcement rules. Article 4 is also in conformity with Article 42 of the TRIPs Agreement, which provides that 12.31 ‘Members shall make available to right holders civil judicial procedures concerning the enforcement of any intellectual property right covered by this Agreement’. A note to this Article provides that ‘the term “right holder” includes federations and associations having legal standing to assert such rights’. It is alleged that persons/bodies referred to in Article 4 of the Enforcement Directive are entitled to 12.32 sue for copyright infringement in their own names and not as representatives acting on behalf of the initial/original right owners.45 Yet, this issue is of limited importance (except perhaps for claims for damages) and is not clear-cut in the relevant provision. What happens in reality is that Member States follow their own laws, some providing for such a legal capacity only for the right holder,

43 44 45

For the purpose of this Part, the term ‘right holder’ includes federations and associations having legal standing to assert such rights. The possibility of making such a request is not subject to any limitation as to the origin, contractual or otherwise, of the IP infringement: see Case C-666/18, IT Development SAS v Free Mobile SAS, ECLI:EU:C:2019:1099, para. 41. Walter and Goebel, 1226.

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while others (which is more common) provide for parallel actionability (allowing or requiring the right holder to sue herself/himself in parallel with the licensee).

2. Article 4(a) and ‘holders’ of intellectual property rights 12.33 The first category of beneficiaries are right owners of copyright and/or related rights who (a) have created/authored the copyright work, performed the work, produced the phonogram or first fixation of film, broadcast the work or made the database (i.e. executed the ‘creative’ or ‘related to it’ act that renders them beneficiaries by law and gives rise to the right itself) or (b) have inherited the rights from the original creator or beneficiary of related rights. 12.34 The fact that apart from copyright related rights are also included derives (a) from the fact that intellectual property is defined in the Directive as including related rights and (b) from Article 5 which refers to presumptions of authorship and ownership where related rights are expressly mentioned. In any case any other interpretation would make no sense since it would limit the scope of the Directive unjustifiably and would contradict the remainder of its provisions. 12.35 According to this Article the ‘holders of intellectual property rights’ have the right to sue unconditionally and with no reservation. This is assumed by the fact that the phrase ‘in so far as permitted by’ contained in paragraphs (b)–(d) is not provided for in paragraph (a). However, who the original right holder is, is a matter to be decided on the basis of the applicable law. Whoever the right holder is Member States have to provide to it the rights enshrined in the Directive.

3. Article 4(b) and ‘all other persons authorised to use those rights’ 12.36 This is a rather general term aiming at encompassing licensees and successors in title. A Member State’s legal system concerning transfer of rights (whole or partial), assignments, (exclusive or non-exclusive) licences or any other kind of contract or agreement for the exploitation or use of a right does not affect the operation of Article 4(b). This provision had to be drafted in such a general manner so as to accommodate the fact that disposing of IP rights by means of contract was not harmonised in the EU as well as the needs of the differing national systems. 12.37 Authorised third parties are entitled to sue only insofar as permitted by and in accordance with the provisions of the applicable law. The reference to applicable law should be understood, in the light of Article 2(1) of the Directive, as referring to both national and EU legislation, as appropriate.46 Yet, the wording of Article 4(b) is not entirely clear. At first sight it seems that authorised third parties have a legal standing only if this is permitted and to the extent it is permitted by the applicable law. However, the reference to the ‘applicable law’ does not fully indicate whether it is a reference to the substantive law of the Member State concerned or a reference to a conflict of laws rule. Different views have been expressed. First, it has been argued that the provision refers to the Member States’ discretion to provide or not for such a legal standing for the parties at issue. This, however, would make no sense since a particular reference in the Directive would not be required. Member States would continue to apply their own laws with no change whatsoever. At the same time this provision would have nothing to add to reinforce the enforcement of IP rights. This interpretation would also contradict the aim and spirit of the provision. Second, it has been argued that Member States are obliged to provide for the legal standing of those parties in principle. Yet, which authorised third parties may sue (e.g. whether only exclusive or non-exclusive licensees can sue, whether the owner has to combine forces/join an action with the licensee suing or not, etc.)

46

See, by analogy, regarding Art. 4(c), Case C-521/17, Coöperatieve Vereniging SNB-REACT U.A. v Deepak Mehta, ECLI:EU:C:2018:639, para. 31.

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and the particulars of such legal standing (e.g. time limitations, before what courts they may appear, if they need a lawyer to do so, etc.) would be defined according to the law of the Member State at issue. In this second case a minimum is secured according to which Member States may provide that certain licensees or assignees should be allowed to sue or may sue under certain conditions; however in no case can a Member State exclude legal standing for authorised third parties altogether since this would contradict both with the letter and the spirit of the Directive.47 Third, there is the view that all authorised third parties should be able to sue. Yet, if that were the case no reservation would follow referring to ‘permission’ or ‘applicable law’.48 There is also a fourth view according to which the reference to the applicable law is a reference to a conflict of laws rule, which allows Member States to decide which law applies in order to decide the issue of legal standing in a particular case. This could be, for example, the substantive law of the country where the infringement took place and protection is sought, the country of origin of the work or the country where the contract has been concluded.49 The second and the fourth interpretations seem to be closer to the spirit of the Directive. It follows 12.38 from the CJEU’s recent case law dealing with the meaning and scope of the terms ‘applicable law’ and ‘as permitted’ in relation with Article 4(c) that the first one is incorrect.50

4. Article 4(c) and (d) A. ‘Intellectual property collective rights-management bodies’ and ‘professional defence bodies’ This provision is equivalent to the previous one (Art. 4(b)), this time referring to collective rights 12.39 management societies and professional defence bodies. Such bodies may in some cases be better positioned and equipped than the right holders themselves to effectively bring legal proceedings to address IP infringements where needed, in particular where the right holders are SMEs.51 Again it is up to the Member States to decide to what extent these societies and bodies have a legal standing and the particulars of such a legal standing and representation (see also Art. 5 in this respect). It is also up to the Member States to decide whether these bodies will sue under their own names or the names of the original right holders or both. Yet, Member States are obliged to provide for such a capacity in their laws otherwise it would make no sense to have such a provision in the Directive with the aim to ensure effective enforcement of IP rights. Thus, paragraphs (c) and (d) of Article 4 cannot be interpreted as meaning that they afford unlimited discretion to the Member States as to whether or not to recognise collective rights management societies and professional defence bodies as persons entitled to seek, in their own name, the application of the remedies laid down by the Directive. Such an interpretation would render entirely ineffective those provisions, which are intended to harmonise the laws of the Member States. Where a Member State’s national law regards a body collectively representing IP right holders as having a direct interest in the defence of IP rights and as being allowed to bring legal proceedings to that end (as the case is in Belgium, France, the Netherlands and Portugal), it must recognise such a body as a person entitled to seek, in its own name, the application of the measures, procedures and remedies provided for by the Directive.52

47

48 49 50 51 52

D. Frey and M. Rudolph [2004] ZUM, 527; A. Lakits-Josse, ‘Directive 2004/48 of the European Parliament and of the Council of 29 April 2004 on the Enforcement of Intellectual Property Rights’, in T. Cottier and P. Veron, Concise International and European IP Law, 2nd ed., Wolters Kluwer, Law and Business, The Hague, 2014, 392; Walter and Goebel, 1228–1229. G. Harbottle [2005] 148 March CW 22, 23, as quoted in Walter and Goebel, 1228. M. Walter, Rechtsdurchsetzung, 252 ff; Walter and Goebel, 1229. See the discussion above under Art. 4(c) and (d) in the next paragraph. Guidance, 25. Case C-521/17, Coöperatieve Vereniging SNB-REACT U.A. v Deepak Mehta, ECLI:EU:C:2018:639, paras. 32 and 34.

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B. ‘Regularly recognised as having a right to represent holders of intellectual property rights’ 12.40 Collective rights management societies and professional defence bodies are usually authorised by original right holders to be able to enforce their rights. This is a practice which is common throughout the EU. This provision allows these bodies to institute proceedings even in cases where such an authorisation is not express or even not provided. This aims at facilitating the legal standing of collective management or collective protection societies, which manage hundreds or thousands of rights introducing at the same time a rebuttable presumption, meaning that the court, the original right holder or whoever draws rights or interests from the case at issue may prove that such an authorisation is not there. 12.41 This is also linked to the fact that collecting societies may have the ability (depending on what national law provides) to sue on the basis of their whole repertory and not only on the basis of the single work infringed, and to represent right holders who are not their members or are not their members yet by reason, e.g., of a legal presumption found in national law (as the case is in Greece in relation to right holders of related rights)53 according to which it is presumed that a collecting society represents without exception all beneficiaries, both national and foreign, and all their works. This is especially true for claims for equitable remuneration where right holders of related rights may not be able to sue themselves but only through a collecting society. This is dictated by reasons of practice in order for users to be able to clear rights more easily and effectively though a centralised body. 12.42 According to Article 12 TFEU and Directive 2006/123 on services in the internal market such bodies may institute proceedings in a Member State irrespective of the Member State in which they are established. In any case, however, these bodies need to abide by the general rules applicable to collecting societies or collective protection societies in the Member State at issue.

C. ‘In so far as permitted by and in accordance with the provisions of the applicable law’ 12.43 See the discussion under Art. 4(b).

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). Treaty on the Functioning of the European Union (TFEU), 1 December 2009. See also related instruments at Art. 1.

53

Article 55(2) of the Greek Copyright Act No. 2121/1993: A collecting society shall be presumed to have the competence to administer and/or protect the rights in all of the works or in respect of all of the authors concerning which or for whom a declaration of transfer to the society has been effected in writing, or for which it has been granted power of attorney. Where a collecting society operating with the approval of the Minister of Culture and Tourism exercises the right to a single equitable remuneration as described in paragraph 1 of Article 49 of this Law it shall be presumed that such collecting society represents without exception all beneficiaries, both national and foreign, and all their works. In such a case, the same shall be presumed where, for each category of beneficiaries there are more collecting societies, given that the rights are exercised by the competent collecting societies altogether (as added with Article 46 of Law No. 3905/2010). Regardless of whether its authorisation rests on a transfer of rights or on power of attorney, a collecting society shall in all circumstances be entitled to initiate judicial or extrajudicial action in its own name and to exercise in full legitimacy all the rights transferred to it, or for which it holds power of attorney.

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2. CJEU case law IT Development SAS v Free Mobile SAS (C-666/18), ECLI:EU:C:2019:1099. Coöperatieve Vereniging SNB-REACT U.A. v Deepak Mehta (C-521/17), ECLI:EU:C:2018:639.

3. Bibliography See Bibliography at Art. 1.

ARTICLE 5: PRESUMPTION OF AUTHORSHIP OR OWNERSHIP For the purposes of applying the measures, procedures and remedies provided for in this Directive, (a) (b)

for the author of a literary or artistic work, in the absence of proof to the contrary, to be regarded as such, and consequently to be entitled to institute infringement proceedings, it shall be sufficient for his/her name to appear on the work in the usual manner; the provision under (a) shall apply mutatis mutandis to the holders of rights related to copyright with regard to their protected subject matter.

SELECTED RECITAL (19) Since copyright exists from the creation of a work and does not require formal registration, it is appropriate to adopt the rule laid down in Article 15 of the Berne Convention, which establishes the presumption whereby the author of a literary or artistic work is regarded as such if his/her name appears on the work. A similar presumption should be applied to the owners of related rights since it is often the holder of a related right, such as a phonogram producer, who will seek to defend rights and engage in fighting acts of piracy.

RELATED LEGAL INSTRUMENTS BERNE CONVENTION ARTICLE 15: RIGHT TO ENFORCE PROTECTED RIGHTS (1)

(2) (3)

In order that the author of a literary or artistic work protected by this Convention shall, in the absence of proof to the contrary, be regarded as such, and consequently be entitled to institute infringement proceedings in the countries of the Union, it shall be sufficient for his name to appear on the work in the usual manner. This paragraph shall be applicable even if this name is a pseudonym, where the pseudonym adopted by the author leaves no doubt as to his identity. The person or body corporate whose name appears on a cinematographic work in the usual manner shall, in the absence of proof to the contrary, be presumed to be the maker of the said work. In the case of anonymous and pseudonymous works, other than those referred to in paragraph (1) above, the publisher whose name appears on the work shall, in the absence of proof to the contrary, be deemed to represent the author, and in this capacity he shall be

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entitled to protect and enforce the author’s rights. The provisions of this paragraph shall cease to apply when the author reveals his identity and establishes his claim to authorship of the work. (4) (a) In the case of unpublished works where the identity of the author is unknown, but where there is every ground to presume that he is a national of a country of the Union, it shall be a matter for legislation in that country to designate the competent authority which shall represent the author and shall be entitled to protect and enforce his rights in the countries of the Union. (b) Countries of the Union which make such designation under the terms of this provision shall notify the Director General by means of a written declaration giving full information concerning the authority thus designated. The Director General shall at once communicate this declaration to all other countries of the Union.

I. COMMENTARY 1. Introduction 12.44 Article 5 deals entirely with copyright and related rights, and in particular with the presumption of authorship and ownership. Given the fact that copyright is not subject to formalities and therefore proof of authorship/ownership may prove difficult, burdensome and expensive, it establishes a rebuttable presumption (‘in the absence of proof to the contrary’) in favour of the person, natural or legal, whose name appears on the work in the usual manner. This person may institute proceedings and apply the measures, procedures and remedies provided in the Directive. Article 5 is thus aimed at facilitating the enforcement possibilities of copyright and related rights owners, in that it prevents infringers from raising artificial defences relying on the alleged lack of entitlement of the claimant to institute infringement proceedings based on such rights. 12.45 In the Commission’s opinion, while the Member States enjoy some discretion when giving effect to Article 5, notably regarding the rules on when and how the necessary proof to rebut the presumption is to be provided, these rules must be interpreted and applied in such a way as to ensure the effectiveness of Article 5, i.e. to safeguard its objective to facilitate the enforcement of their rights by authors and owners of copyright and related rights.54

2. ‘Author’ 12.46 It should be noted here that although the word ‘author’ is used in the text of the provision, nothing indicates that it is necessarily a natural person that is entitled to these rights. If Member States recognise initial ownership by legal persons, these persons will be able to institute proceedings under their names according to the text of the Directive. Although the title of the provision refers both to authorship and ownership, in essence it deals with a right holder’s right to institute proceedings. On top of this the reference to ‘literary and artistic works’ following the wording of the Berne Convention is indicative of the fact that all copyright works are covered. 12.47 This provision has been almost literally copied from Article 15(1) of the Berne Convention with the exception of the second sentence, which provides that ‘[t]his paragraph shall be applicable even if this name is a pseudonym, where the pseudonym adopted by the author leaves no doubt as to his

54

Guidance, 25–26. This follows from the ‘useful effect’ doctrine: see, inter alia, Case 187/87 Land de Sarre v Ministre de l’Industrie, ECLI:EU:C:1988:439, para. 19; Case C-162/09 Lassal, ECLI:EU:C:2010:592, para. 51; Case C-152/13 Holger Forstmann Transporte, ECLI:EU:C:2014:2184, para. 26.

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identity’ (see Recital 19). It is not clear why this sentence was left out. Despite this, however, it applies unreservedly given the fact that all Member States of the EU are parties to the Berne Convention and have to comply with the particular provision. Article 15(2) of the Berne Convention refers to cinematographic works and provides that ‘[t]he 12.48 person or body corporate whose name appears on a cinematographic work in the usual manner shall, in the absence of proof to the contrary, be presumed to be the maker of the said work’. No equivalent provision is found in Article 5 of the Enforcement Directive. Apart from the fact that Article 15(2) applies anyway for all Member States, it can also be argued that cinematographic works come within the scope of literary and artistic works according to Article 2(1) of the Berne Convention and therefore no special mention was required. This also reinforces the argument that the reference in Article 5 of the Enforcement Directive to ‘persons’ includes both natural and legal persons. Article 15(3) of the Berne Convention refers to ‘anonymous and pseudonymous works’. For these 12.49 works the publisher whose name appears on the work is, in the absence of proof to the contrary, deemed to represent the author, and in this capacity s/he is entitled to protect and enforce the author’s rights. If the author reveals his identity and establishes his claim to authorship of the work the presumption in favour of the publisher no longer applies. Although this provision is also absent from the Enforcement Directive, it nevertheless applies to all EU Member States since they are all parties to the Berne Convention.

3. ‘On the work in the usual manner’ According to Article 5, for the provision to apply the name of the author should appear ‘on’ the 12.50 work in the usual manner. It is true that the names of authors usually appear on the work rather than anywhere else, e.g. on the cover of the book, on the cover of the CD or DVD, at the opening or closing titles of the film and so on. It may also appear in the promotion material, e.g. leaflets or blurb accompanying the work. This was especially so in the ‘hard copy’ world while in the digital world where copies of the work may also be in intangible form the word ‘on’ should be interpreted in a broader manner also encompassing the ‘making available’ of the work, its ‘distribution’ or its ‘communication to the public’. Therefore if a copyright work is sent to a user/buyer/licensee being accompanied by an email or other material indicating the author/right holder, or if one accesses the work through a website, which allows one to find out the author by clicking on a particular link on the site or by clicking on a dropdown menu or in any other manner, which indicates the author in a clear, express and unreserved way and this is a manner which may be considered as ‘usual’ in the circumstances and in this particular field of commerce/activity or exploitation of rights, then this manner comes within the scope of the Directive. In any case Member States may provide in their national laws for presumptions of authorship and 12.51 ownership that are more favourable to right holders (e.g. being broader in scope) in the sense that they facilitate their legal standing and claiming of rights before the courts or other competent bodies.55

55

See, for example, French law where the presumption applies if the work is made available to the public in any form or Austrian law where it applies when the author’s name appears on the original work, on the occasion of its publication or its being made available to the public. See Walter and Goebel, 1234. See Case T-19/07 Systran SA and Systran Luxembourg v Commission, ECLI:EU:T:2010:526, para. 206.

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4. ‘Holders of rights related to copyright’ 12.52 If it were not for paragraph (b), Article 5 would present no added value concerning presumptions of authorship and ownership in comparison to the Berne Convention. In fact it could be argued that the Berne Convention would even go further compared to Article 5 of the Enforcement Directive. Yet, paragraph (b) extends the presumption applied to copyright to related rights mutatis mutandis. 12.53 This is very important for the following reasons. First, no international convention, including Article 11 of the Rome Convention, provides for such a presumption in relation to related rights. Second, this presumption was of a high practical significance given the fact that on most occasions it is the right holders of related rights who seek to defend rights and engage in fighting acts of piracy (Recital 19). The reason for that is that right holders are usually entrepreneurs, who draw direct financial gain from their protected subject matter and possess the financial means to effectively enforce their rights in any respect possible while seeking compensation for damage.

NOTES 1. Related instruments Berne Convention for the Protection of Literary and Artistic Works, last amended on 28 September 1979. Rome Convention on the law applicable to contractual obligations 1980 (consolidated version), OJ C 027/34, 26.01.1998. See also related instruments at Art 1.

2. CJEU case law Systran SA and Systran Luxembourg v Commission (C-19/07), ECLI:EU:T:2010:526.

3. Bibliography See Bibliography at Art. 1.

SECTION 2 EVIDENCE ARTICLE 6: EVIDENCE 1.

2.

Member States shall ensure that, on application by a party which has presented reasonably available evidence sufficient to support its claims, and has, in substantiating those claims, specified evidence which lies in the control of the opposing party, the competent judicial authorities may order that such evidence be presented by the opposing party, subject to the protection of confidential information. For the purposes of this paragraph, Member States may provide that a reasonable sample of a substantial number of copies of a work or any other protected object be considered by the competent judicial authorities to constitute reasonable evidence. Under the same conditions, in the case of an infringement committed on a commercial scale Member States shall take such measures as are necessary to enable the competent judicial authorities to order, where appropriate, on application by a party, the communication of banking, financial or commercial documents under the control of the opposing party, subject to the protection of confidential information.

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SELECTED RECITALS (14) The measures provided for in Articles 6(2), 8(1) and 9(2) need to be applied only in respect of acts carried out on a commercial scale. This is without prejudice to the possibility for Member States to apply those measures also in respect of other acts. Acts carried out on a commercial scale are those carried out for direct or indirect economic or commercial advantage; this would normally exclude acts carried out by end consumers acting in good faith. (17) The measures, procedures and remedies provided for in this Directive should be determined in each case in such a manner as to take due account of the specific characteristics of that case, including the specific features of each intellectual property right and, where appropriate, the intentional or unintentional character of the infringement. (20) Given that evidence is an element of paramount importance for establishing the infringement of intellectual property rights, it is appropriate to ensure that effective means of presenting, obtaining and preserving evidence are available. The procedures should have regard to the rights of the defence and provide the necessary guarantees, including the protection of confidential information. For infringements committed on a commercial scale it is also important that the courts may order access, where appropriate, to banking, financial or commercial documents under the control of the alleged infringer.

RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT ARTICLE 43: EVIDENCE 1.

2.

The judicial authorities shall have the authority, where a party has presented reasonably available evidence sufficient to support its claims and has specified evidence relevant to substantiation of its claims which lies in the control of the opposing party, to order that this evidence be produced by the opposing party, subject in appropriate cases to conditions which ensure the protection of confidential information. In cases in which a party to a proceeding voluntarily and without good reason refuses access to, or otherwise does not provide necessary information within a reasonable period, or significantly impedes a procedure relating to an enforcement action, a Member may accord judicial authorities the authority to make preliminary and final determinations, affirmative or negative, on the basis of the information presented to them, including the complaint or the allegation presented by the party adversely affected by the denial of access to information, subject to providing the parties an opportunity to be heard on the allegations or evidence.

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I. COMMENTARY 1. Introduction 12.54 Article 6 is one of the three articles of Section 2 on evidence and information.56 Next to Articles 7 and 8 dealing, respectively, with the preservation of evidence and the right of information, it relates to the disclosure of evidence. It draws its origins from Article 43 of the TRIPs Agreement although it contains some ‘TRIPs Plus’ elements, which will be discussed later on. 12.55 Article 6 provides for the production of evidence by the opposing party on the basis of the applicant’s claim before the courts.

2. Article 6(1) A. The terms ‘party’ and ‘opposing party’ 12.56 The use of the terms ‘party’ and ‘opposing party’ are perhaps meant to be neutral since it is not required in this provision that all right holders or all those having the right to sue apply to the courts or that all infringers (primary or secondary) are sued, especially if not all of them have the evidence of interest in their control. B. The nature of proceedings in the context of which the application is filed 12.57 This provision does not also specify (as the case is with Art. 7) whether this measure may also be available ‘before the commencement of proceedings on the merits’. In other words it is not clear whether use of such a measure may also be made in the course of preliminary or precautionary measures/proceedings such as interlocutory injunctions. This is rather important because a large percentage of IP infringement cases take place through preliminary proceedings and never reach the stage of a proceeding on the merits. Although one could derive an a contrario argument on the basis of Article 7 wording such an argument would not be viable if one looks at Article 9 of the Directive. Article 9 interlocutory injunctions are supplemented by Articles 6 and 7. This is also in line with the aim of the Directive consisting of fast and effective relief and enforcement. In any case, however, the production of evidence needs to take place in the context of pending proceedings, irrespective of the fact whether these are preliminary proceedings or proceedings on the merits. 12.58 Article 6 does not provide whether this measure is to be implemented on the basis of a procedural or substantive provision. It is alleged that ‘the advantage of procedural measures is that they are faster and, therefore, more effective, while also providing better safeguards against abuse since the judge in charge of the pending infringement proceeding is in a better position to recognize possible abuse by the applicant’.57 Yet, it seems clear that if the Directive had opted for one or the other solution it would have provided so in the text of the article. On the contrary, such a provision is not there so the matter is left to the Member States’ discretion. Accordingly, the different Member States provide for different solutions.

C. ‘Specified evidence’ 12.59 Article 6 refers to specified evidence in general without itemising it. Itemising it, of course, would not be possible, unless this was done in a rudimentary or non-exhaustive manner. It therefore seems 56

57

For more information on evidence see ‘Evidence and Right of Information in Intellectual Property Rights’, Study by the European Observatory on Counterfeiting and Piracy (2010), https://euipo.europa.eu/ohimportal/documents/11370/ 80606/Evidence+and+right+of+information+in+Intellectual+Property+rights/9cce8f61-35a1-4e66-b9a4-3e730c09307c. Walter and Goebel, 1237.

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that any kind of evidence relating to the IP case at issue may be subject to this provision irrespective of whether it directly relates to the infringement itself (i.e. aims at proving the infringement) or to aspects of it such as the intent of the party, the number of parties involved, the degree of damage, the means used for the infringement, the source from which the work has been acquired and so on. In a case of the German Federal Supreme Court relating to software, the disclosure of the source code of the computer program was ordered.58 Article 6 does not provide either for the extent of the detail required in order to make the evidence claimed ‘specific’. It is, however, logical to argue that one cannot expect, for example, the applicant to describe the content of a document required but rather its nature. Examples may include invoices relating to the infringing goods, distribution or other kind of agreements, transport documents and so on.59 Article 6 does not determine the degree of specification of the evidence required. In this regard, the 12.60 disclosure regime of the Competition Damages Directive60 goes into further detail: this Directive’s Article 5(2) obliges the Member States to ensure that national courts are able to order the disclosure of specified items of evidence or relevant categories of evidence circumscribed as precisely and as narrowly as possible. A similar approach would be justified when interpreting and applying Article 6 of the Enforcement Directive.61 While the applicant should specify the information he is requesting to the furthest extent possible, requiring an excessive level of detail would call into question the effectiveness of the disclosure measures provided for by Article 6 and would raise the question of the ‘proportionality’ and the ‘fair and equitable’ nature of such requirements. Detailed national requirements of this type could, therefore, be contrary to Article 6, read in conjunction with the obligations set out in Article 3 of the Directive. The degree of specification should, however, be sufficient to allow the opposing party to identify concrete evidence lying in its control and the competent judicial authority to decide on the disclosure request.62 What the provision aimed at by using the word ‘specified’ was to avoid ‘fishing expeditions’ where the right holder does not know what he is looking for but wants to achieve the presentation of any document relating to the infringement without specifying what such a document may be.

D. ‘In the control of the opposing party’ The evidence ordered needs to lie in the control of the opposing party. The opposing party will be 12.61 the ‘alleged’ infringer. This derives from the fact that evidence in possession of third parties – other than the infringer – may be seized on the basis of Article 7. The evidence need not necessarily have been produced/created/authored/made by the opposing party. It suffices that it is in its control, indicating that the opposing party may have not produced it itself or own it but may have it in its possession or may get hold of it.63 In the Commission’s opinion, the use of the word ‘control’ suggests that it is not even necessarily required that the party is in possession of the evidence: Article 6(1) could give grounds to an obligation on a party to carry out a diligent search for the evidence within its organisation (including separate legal entities which it controls), provided that the applicant has adequately substantiated and specified the request for the evidence concerned and, in accordance with Article 3 of the Directive, the obligation does not go beyond what is proportionate

58 59 60

61 62 63

Case IZR 45/01 Faxkarte of BGH of 2 May 2002 BGHZ 150, 377; [2002] GRUR Int 1046; [2002] ZUM-RD 573. Regarding the use and presentation of digital evidence, such as screenshots, in proceedings for the enforcement of IP rights, see Guidance, 21–22. Directive 2014/104/EU of the European Parliament and of the Council of 26 November 2014 on certain rules governing actions for damages under national law for infringements of the competition law provisions of the Member States and of the European Union, OJ L 349/1, 5.12.2014. Guidance, 12; F.G. Wilman, 516. Guidance, 12–13. When the opposing party has produced the evidence but the latter is no longer under that party’s control, Art. 6 does not apply.

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and is not unnecessarily costly, and safeguards against abuse are provided for where necessary.64 In any case one has something in one’s control if one can handle or dispose of it as one wishes.65 If, however, producing such evidence runs contrary to some other provision of law, such as the protection of confidential information, the right to privacy, public order and so on, the court will eventually take these legitimate rights into account before issuing its decision. Article 6 also applies in cases of contributory or secondary infringement where the persons involved are considered in the case at issue as the opposing parties.

E. ‘Reasonably available evidence sufficient to support its claims’ 12.62 The application has to be filed by a party, who has presented reasonably available evidence sufficient to support its claims. The claims mentioned here – in conformity with Article 7 where it is provided that ‘on application by a party who has presented reasonably available evidence to support his/her claims that his/her intellectual property right has been infringed or is about to be infringed’ – refer to claims for infringement. Whether Article 6 also applies to non-infringement claims is unclear. According to some authors, Article 6 is two-sided in nature, which means that not only alleged infringers, as defendants, but also right holders, as plaintiffs, could be required to disclose evidence where appropriate. In those scholars’ opinion, such an interpretation would be consistent with the fundamental right to a fair trial enshrined in Article 47 of the EU’s Charter of Fundamental Rights.66 What is clear in any event is that the applicant needs to present evidence concerning both ownership and infringement. This evidence needs to be ‘reasonably available’ and ‘sufficient’ to support this claim. If this wording is compared to Article 9(3) of the Directive, which requires that the reasonably available evidence satisfies the court with a sufficient degree of certainty that the applicant is the right holder and that the applicant’s right is being infringed, or that such infringement is imminent, one realises that the standard of evidence provided under Article 6 is lower than the one stipulated in Article 9; it directly relates to each case at issue and the specificities and particularities of the IP right involved. This ‘concession’ in evidentiary standards is more pragmatic, takes into account the difficulties of producing evidence in relation to infringement of rights in intangible goods and renders enforcement more effective. Also, it is for the courts to decide whether in the circumstances the evidence presented is ‘reasonably available’ and ‘sufficient’. 12.63 It has been argued that since the claim refers to infringement alone and not to additional elements to it, the applicant does not have to provide in its application that the piece (or pieces) of evidence requested are necessary to fill the puzzle or confirm certain aspects of the case at issue. This would unnecessarily complicate the procedure.67 Yet, this interpretation does not seem to be correct. Since the provision provides that it is for the court to decide (‘may order’) whether to order the disclosure of certain evidence or not it would be almost impossible for the court not to take into account the reasons and the necessity for such a disclosure. If that were not the case the disclosure of evidence would be almost automatic since the court’s discretion would be exhausted solely in examining whether issues of confidentiality arise. The court would in essence have no other power but to examine whether an application for presentation of evidence is abusive or not (e.g. in a case, for example, where information linked to a particular infringement is required for reasons other than those applied). This interpretation is also backed by the fact that according to Article 3(1) measures need to be ‘fair and equitable’ whilst according to Article 3(2) they need to be ‘proportionate’. Proportionality is not assessed on the basis of whether a measure provided in the Directive should

64 65 66 67

Guidance, 13. ‘The practices of the courts vary in this respect but the majority of the courts seem to limit the extent of the disclosure to the items in the possession of the person(s) who is (are) required to disclose.’ Report II, 9. F.G. Wilman, 515. Walter and Goebel, 1239.

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apply or not but on the specificities of the measure, e.g. how and to what extent the measure is applied in the case at issue. Article 6(1) is not a novel provision since it is almost literally copied from Article 43(1) of the TRIPs 12.64 Agreement.

F. Sanctions Interestingly, Article 43(2) of the TRIPs Agreement has not been reiterated in Article 6 of the 12.65 Directive. Therefore there is no particular mention of sanctions relating to a party’s non-compliance with the disclosure order. However, given the fact that according to Article 3(2) of the Directive (in conjunction with Recitals 3 and 20) means need to be ‘effective’ and ‘dissuasive’ as well as the fact that Member States are all members of the TRIPs Agreement and thus obliged to implement its standards, combined with the Directive’s aim to introduce ‘TRIPs Plus’ standards in the field, it can be argued that the absence of Article 43(2) of the TRIPs Agreement in the Directive is only meant as leaving Member States free to introduce their own sanctions in case of a party’s non-compliance with the disclosure order. In any case Member States need to introduce sanctions in order to render such orders effective and dissuasive. G. Confidentiality According to Article 6(1) disclosure of information is subject to the protection of confidentiality. 12.66 This restriction is particularly important when the documents indicated as evidence to be potentially presented contain trade secrets or other commercially sensitive information of the party subject to the disclosure measure. Confidentiality comes into play since the means of the Directive need to be ‘fair and equitable’ (Art. 3(1)) and ‘proportionate’ (Art. 3(2)), while at the same time ‘effective’ and ‘dissuasive’. Thus, while requests for the presentation of evidence should be relevant to prove the claims at issue in the legal proceedings at hand, the claim on the part of the opposing party of ‘confidentiality’ in order to avoid the presentation of evidence applied by the right holder does not suffice. The court first needs to examine whether there are issues of confidentiality relating to the evidence at issue and assess whether these issues apply to the evidence as a whole or only to parts of it. Even if some information in the opposing party’s possession will be crucial for demonstrating the alleged infringement or its scope or consequences, the specific nature of this information could in some cases still be of such an important commercial value that it should not be disclosed to the applicant, especially when the parties are competitors. However, it should be noted, in this regard, that Article 6 does not provide that such confidential information cannot be supplied in the proceedings concerned. Rather, it provides that that information must be protected.68 It follows from Recital 20 of the Directive that evidence is an element of paramount importance for establishing the infringement of IP rights and that it is appropriate to ensure that effective means of presenting, obtaining and preserving evidence are available. Therefore, Member States must, in an effective manner, enable the injured party to obtain the evidence within the opposing party’s control necessary for supporting its claims, provided that providing such evidence respects the protection of confidential information.69 The Directive does not specify how confidentiality is to be protected. Therefore Member States 12.67 need to provide for their own mechanisms, which will serve the needs of right holders and at the same time safeguard confidentiality interests. Different Member States follow different systems, some of them already provided in their civil procedure laws concerning the presentation of evidence in general and not only in IP cases. Most systems operate a ‘filtering system’. Some systems allow

68 69

Guidance, 13–14. Case C-149/17 Bastei Lübbe GmbH & Co. KG v Michael Strotzer, ECLI:EU:C:2018:841, paras. 40–41.

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the court to assess itself which parts of the evidence are considered confidential and which not (this is the case in most Member States including Greece and Germany) or appoint an expert having signed a confidentiality agreement to inspect and assess such evidence in relation to the case at issue. The courts either disclose parts of the evidence or assess the claims at issue on the basis of information submitted to the expert without disclosing such information to the applicant, or have the case heard in camera (i.e. in private proceedings which the public does not have access to) (Germany). These systems do not necessarily apply alternatively. They may also apply cumulatively.

H. Sampling 12.68 The first sentence of Article 6(1) refers to documentation as evidence and is obligatory for Member States while the second sentence refers to infringing articles as such and to the measure of sampling and it is optional.70 Member States may decide not to adopt it. ‘Sampling’ is a practice which was provided in the laws of some Member States (e.g. Greece and Austria) before the enactment of the Directive. Article 6(1) second sentence (sampling) applies both to copyright and related rights. According to it right holders can submit to the court a reasonable sample of a substantial number of copies of their work or other protected subject matter as reasonable evidence that all goods inspected/seized/confiscated are infringing goods. What sample is ‘reasonable’ is for the court to decide. 12.69 This provision is particularly useful in cases of large numbers of infringing goods where it is impractical, costly and time consuming to submit all of them to the court. 12.70 Sampling should not be confused with the right holder’s right to destroy the remaining articles if a reasonable sample is there to be provided to the court. First, one cannot know what a reasonable sample is unless the court considers it to be so. Second, sampling usually takes place in the context of preliminary proceedings while a case on the merits follows. However, irrespective of whether sampling takes place in preliminary or substantive proceedings the court may decide that no infringement has taken place and the defendant may be able to claim the allegedly infringing articles back together with damages or compensation. Until the case on the merits is decided the infringing articles will have to be stored and it is usually the right holder that will bear the storage expenses. 12.71 One, of course, will allege that even if the goods are not stored for evidentiary purposes they will have to be stored under Article 9(1)(b) in order to prevent them either from entering or circulating within the market. Again the issue will have to be decided on the basis of a case on the merits since Article 9(1) applies to interlocutory injunctions. 12.72 However, if Member States wish to provide for expeditious destruction – if the allegedly infringing goods are no longer needed for evidentiary purposes – the measure will be considered proportionate if guarantees are provided as safeguards against abuse (Art. 3(2)).71 These guarantees could include the deposit of a sum by the right holder that can work as compensation towards the alleged infringer if infringement is found not to have taken place.72 Another guarantee that could be envisaged is permission for destruction by the court during preliminary proceedings. Member States may also define in detail what would constitute a ‘reasonable sample’ for evidentiary purposes so that the rest of the articles can be destroyed. An expert may also be tasked in this respect by the court.

70 71 72

This is a ‘TRIPs Plus’ element. Walter and Goebel, 1242. See an equivalent provision in this respect (Art. 7(2)) where ‘the lodging by the applicant of adequate security or an equivalent assurance intended to ensure compensation for any prejudice suffered by the defendant’ is provided.

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ARTICLE 43: EVIDENCE

Expeditious destruction is provided as a proportionate measure by some Member States in the 12.73 context of sanctions applied by State enforcement agencies and not by courts. This usually takes place in the context of measures provided for the combat of piracy and counterfeiting. A characteristic example in this respect is Greece, which has empowered the police, the tax police, the port police, the municipal police and controllers for public markets to confiscate infringing goods and destroy them on the spot. This is operated in the context of provisions for administrative fines as an immediate dissuasive measure, which also attempts to diminish the workload for the courts. It is also operated in the context of law especially introduced for public markets. These provisions mainly apply to cases where infringers sell infringing goods on the streets or open markets without the necessary permits, legitimate invoices and so on. This, of course, is a matter of sanctions and should not be confused with issues of evidence.

12.74

3. Article 6(2) Article 6(2) presents a ‘TRIPs Plus’ element and provides for the disclosure of banking, financial or 12.75 commercial documents which are under the control of the opposing party, subject to the protection of confidential information. This measure relates solely to infringements committed on a commercial scale and can be ordered by the courts where appropriate. It should be remembered here that the Directive provides for minimum standards. Member States 12.76 are free to extend the provision to also cover any infringement and not only those committed on a commercial scale.

A. ‘Infringement committed οn a commercial scale’ See the discussion under Article 2.

12.77

According to Article 6(2) one of the requirements for the ordering of such measures by the court is 12.78 that an infringement is committed on a commercial scale. If this provision applies literally then it would be difficult for right holders to also claim documents that are capable of proving the commitment of the act on such a scale if the remainder of their documents do not suffice. In this light the courts should not apply the criterion of commercial scale in such a manner as not to allow cases where infringement on a commercial scale, though not fully substantiated is, however, very likely to have occurred judging from the circumstances.

B. ‘Banking, financial or commercial documents’ Article 6(2) makes an explicit reference to those documents although it could be argued that they 12.79 are covered by paragraph (1). Yet, express reference to these documents was deemed necessary because they are considered to be ‘sensitive’ documents and Member States would not necessarily allow their disclosure under paragraph (1).73 By ‘banking, financial or commercial documents’ all documents relating to the infringer’s business 12.80 or commercial activities are covered, e.g. invoices, bank statements, contracts, accounting records, bills, transport documents, storage documents and so on. Some of these documents can also be claimed on the basis of Article 6(1) or Article 8 (on the information right). However, the latter aims at disclosing information relating to the origin and distribution network of the infringing goods and

73

Some EU Member States have decided not to limit the communication of banking, financial or commercial documents to infringements committed on commercial scale but extend it to all infringements (e.g. France, Poland and Denmark). Report II, 10.

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services. The claim can be addressed against third parties and not solely against the infringer, as the case is under Article 6. 12.81 It has been argued74 that the disclosure of such information is a procedural measure and not a measure coming within the Member States’ national laws providing for substantive claims for a rendering of accounts. In this sense Member States cannot refer to such substantive claims provided in their national laws instead of implementing Article 6(2). This would render the measure inflexible and would not meet the aims of the Directive. Yet, this is not entirely clear in the text of the Directive.

C. ‘Under the same conditions […] enable the competent judicial authorities to order, where appropriate’ 12.82 Member States have to provide for the disclosure of bank, financial and commercial documents by the infringer (either primary or secondary if contributory or secondary infringement) on the same conditions as the ones referred to and explained above under Article 6(1) (i.e. ‘on application by a party which has presented reasonably available evidence sufficient to support its claims’). 12.83 Paragraph 2 contains an additional requirement compared to paragraph (1): the disclosure of this information should be ordered by the court ‘where appropriate’. As explained above75 the court will in any case take into account the necessity of the presentation of a particular piece of evidence for the purposes of the particular case (although the ‘usefulness’ of the document should be interpreted in such a manner so as to include instances where the applicant thinks that the document may contain (and not only does contain) information which may prove vital for the case at issue). This interpretation also applies to paragraph (2). In this sense one could argue that the ‘appropriateness’ of the disclosure in this paragraph – and with respect to the particularly mentioned types of evidence – can only relate to the court examining whether the case at issue is about financial or compensatory claims and is not about infringement proceedings in general. Other (indicative) factors that may be taken into account by the court are whether useful information concerning financial claims can be obtained in any other manner or from any other source, without such obtaining being particularly burdensome, and whether such information could also be obtained under Article 8 of the Directive. In any case Articles 6 and 8 of the Directive work in a complementary manner rather than alternatively. However, if the right holder proves that he has no other means to obtain such information this will definitely support his claim.

D. ‘Party’ and ‘opposing party’ 12.84 See the discussion above under Article 6(1), paragraph 12.55.

E. ‘Under the control of the opposing party’ 12.85 See the discussion above under Article 6(1), paragraph 12.60. F. ‘Confidentiality’ 12.86 See the discussion above under Article 6(1), paragraphs 12.65–12.66.

74 75

Walter and Goebel, 1242–1243. Under the section ‘reasonably available evidence sufficient to support its claims’.

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ARTICLE 7: MEASURES FOR PRESERVING EVIDENCE

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). See also related instruments at Art. 1. Directive 2014/104/EU of the European Parliament and of the Council of 26 November 2014 on certain rules governing actions for damages under national law for infringements of the competition law provisions of the Member States and of the European Union, OJ L 349/1, 5.12.2014.

2. CJEU case law Bastei Lübbe GmbH & Co. KG v Michael Strotzer (C-149/17), ECLI:EU:C:2018:841.

3. Bibliography Bonadio, E. ‘Remedies and sanctions for the infringements of intellectual property rights under EC law’, (2018) EIPR, 30, 320. See also Bibliography at Art. 1.

ARTICLE 7: MEASURES FOR PRESERVING EVIDENCE 1.

2.

3.

Member States shall ensure that, even before the commencement of proceedings on the merits of the case, the competent judicial authorities may, on application by a party who has presented reasonably available evidence to support his/her claims that his/her intellectual property right has been infringed or is about to be infringed, order prompt and effective provisional measures to preserve relevant evidence in respect of the alleged infringement, subject to the protection of confidential information. Such measures may include the detailed description, with or without the taking of samples, or the physical seizure of the infringing goods, and, in appropriate cases, the materials and implements used in the production and/or distribution of these goods and the documents relating thereto. Those measures shall be taken, if necessary without the other party having been heard, in particular where any delay is likely to cause irreparable harm to the rightholder or where there is a demonstrable risk of evidence being destroyed. Where measures to preserve evidence are adopted without the other party having been heard, the parties affected shall be given notice, without delay after the execution of the measures at the latest. A review, including a right to be heard, shall take place upon request of the parties affected with a view to deciding, within a reasonable period after the notification of the measures, whether the measures shall be modified, revoked or confirmed. Member States shall ensure that the measures to preserve evidence may be subject to the lodging by the applicant of adequate security or an equivalent assurance intended to ensure compensation for any prejudice suffered by the defendant as provided for in paragraph 4. Member States shall ensure that the measures to preserve evidence are revoked or otherwise cease to have effect, upon request of the defendant, without prejudice to the damages which may be claimed, if the applicant does not institute, within a reasonable period, proceedings leading to a decision on the merits of the case before the competent judicial authority, the period to be determined by the judicial authority ordering the measures where the law of a Member State so permits or, in the absence of such determination, within a period not exceeding 20 working days or 31 calendar days, whichever is the longer.

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4.

5.

Where the measures to preserve evidence are revoked, or where they lapse due to any act or omission by the applicant, or where it is subsequently found that there has been no infringement or threat of infringement of an intellectual property right, the judicial authorities shall have the authority to order the applicant, upon request of the defendant, to provide the defendant appropriate compensation for any injury caused by those measures. Member States may take measures to protect witnesses’ identity.

SELECTED RECITAL (20) Given that evidence is an element of paramount importance for establishing the infringement of intellectual property rights, it is appropriate to ensure that effective means of presenting, obtaining and preserving evidence are available. The procedures should have regard to the rights of the defence and provide the necessary guarantees, including the protection of confidential information. For infringements committed on a commercial scale it is also important that the courts may order access, where appropriate, to banking, financial or commercial documents under the control of the alleged infringer.

RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT ARTICLE 50(1)(B): PROVISIONAL MEASURES 1.

The judicial authorities shall have the authority to order prompt and effective provisional measures: […] (b) to preserve relevant evidence in regard to the alleged infringement.

I. COMMENTARY 1. Introduction 12.87 Article 7 aims at harmonising measures concerning the acquisition and preservation of evidence. It draws to a substantial extent on Article 50 of the TRIPs Agreement – with the exception of its last paragraph (i.e. paragraph 5) which is considered a ‘TRIPs Plus’ element – and contains characteristics from equivalent national procedures such as the Anton Piller Orders (now known as search orders) in the UK76 and the saisie contrefaçon in France and in Belgium.77 This Article aims at minimum harmonisation while Member States are free to provide more effective protection if they consider it appropriate.

2. Article 7(1) 12.88 According to paragraph 1 Member States must ensure that, even before the commencement of proceedings on the merits of the case, the competent judicial authorities may, on application by a party who has presented reasonably available evidence to support his/her claims that his/her IP right 76 77

Anton Piller KG v Manufacturing Processes Ltd [1975] EWCA Civ 12. In Ireland this procedure is provided in its national law. Both in France and in Belgium this procedure now applies to all IP rights.

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ARTICLE 50(1)(B): PROVISIONAL MEASURES

has been infringed or is about to be infringed, order prompt and effective provisional measures to preserve relevant evidence in respect of the alleged infringement, subject to the protection of confidential information. The fact that these provisional measures may also be ordered before the commencement of any proceedings on the merits of the case may suggest that these measures may relate to a substantive claim. Yet, it has been argued that the provision does not aim to reflect a particular preference as to the nature of the claim as long as the measures ordered are prompt and effective. The timing is also irrelevant since the provision leaves open when such measures may be ordered. Although in some Member States it remains difficult to apply for provisional preservation measures before the proceedings on the merits of the case have actually begun, it is expressly provided in Article 7(1) that such measures may be ordered before proceedings on the merits, which necessarily means that they may also be ordered after proceedings on the merits have been initiated to the extent that the content of the measure has not already been satisfied on the basis of another provision available under the Directive (e.g. Art. 9(1)(b)). It has been argued78 that the wording ‘before the commencement of proceedings on the merits of the case’ also includes the commencement of interlocutory proceedings. Such argument is in line with the aim of the provision, which is to ensure the acquisition and preservation of evidence ‘at any time’, as well as with the express requirement in Article 3 of the Directive that the measures are prompt and effective. The wording used suggests that any such measures to preserve evidence are only available to right 12.89 holders alleging an infringement, and not also to defendants.79 The measure is subject to an application by the right holder (referred to in the provision as the ‘party’) who has presented reasonably available evidence to support his/her claims that his/her IP right has been infringed or is about to be infringed. Therefore it is not necessary that infringement is committed; it suffices that it is about to be committed. Even when there is an alleged infringement the measure can be ordered if the right holder presents reasonably available evidence, without the need to prove at this stage or submit evidence which demonstrates beyond reasonable doubt that the infringing act has been committed. What should be expected by the court is the submission only of evidence that can be reasonably available in the circumstances and on the basis of which it is likely that infringement has been committed or is about to be committed. This is also the reason why guarantees are provided later on in the same article (i.e. paragraph 2) for the ordering of such a measure. The standard provided for the submission of evidence to the court, while worded slightly differently 12.90 in Article 6(1) concerning interlocutory injunctions, can be assumed to be the same as in that provision. In both cases a ‘sufficient degree of certainty’ as regards infringement needs to be established as a prerequisite for the ordering of the measure. Although the word ‘sufficient’ only appears in Article 6(1) and not in Article 7(1), it can be assumed that if sufficient evidence is not presented claims cannot be supported.80 It is expressly mentioned that the aim of this measure is ‘to preserve relevant evidence in respect of 12.91 the alleged infringement’. Yet, this wording (if seen in conjunction with Recital 20 of the Directive) should be construed broadly encompassing also instances of ‘presenting’ and ‘obtaining’ evidence. The obtaining and preservation of evidence does not aim solely at its preservation from the risk of loss before the main proceedings commence. This would be rather wrong to argue since such a requirement referring to such risk has been deleted from previous drafts of the Directive and remained only as a factor to be taken into account in relation to measures imposed inaudita altera parte. Therefore it can be argued that obtaining and preserving evidence may well be requested – not

78 79 80

Walter and Goebel, 1249. F.G. Wilman, 516. Walter and Goebel, 1252 argue that a lower threshold of certainty is required in relation to evidence provided under Art. 7(1) than under Art. 6(1).

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only for the strict purpose of preserving it for the main proceedings but also for proving infringement as such. 12.92 Article 7(1) refers indicatively to a number of measures such as detailed description, with or without the taking of samples81 or the physical seizure of the infringing goods, including in appropriate cases, the seizure of materials and implements used in the production and/or distribution of these goods. The measure ordered will each time be subject to the IP right allegedly infringed and the circumstances of its infringement. This provision leaves a considerable degree of discretion to the judicial authority ordering the measure so as to decide what the appropriate measure is, taking into account the circumstances at issue (e.g. the severity and extent of the infringement, its intentional character, the features of the right involved and so on). Therefore proportionality needs to be taken into account in order to balance the content of the measure and its effect against the aim to be attained (e.g. obtain the required evidence without rendering the business inoperative by seizing its operating tools or means). This also derives from the wording of the provision, which makes direct reference to ‘appropriate cases’. That means that physical seizure of objects may not be required in all cases since detailed descriptions or some other measure may suffice. 12.93 Right holders may request the ordering of such measures not only against the infringer herself/ himself but also against any party possessing such evidence, who is linked to the case at issue. If this were not the case the measures would not be effective since the infringer could use for example other parties’ storage facilities or premises. This is also made clear by the fact that there is no specific provision as to whom the measures are addressed against (as the case is with Articles 6 and 8). The provision focuses on goods rather than persons. When the measure is addressed against third parties the interests of these parties should also be taken into account by analogy to what is provided in Recital 24 of the Directive in relation to corrective measures.82 Confidentiality of information should also be taken into account. In the light of the above the test of proportionality should be run on the basis of increased guarantees bearing also in mind the interests of third parties. 12.94 The issue which arises at this stage is how confidentiality of information will be protected when the right holder requests the submission of evidence, which the defendant alleges is confidential. A weighing of interests needs to take place and the facts of the case as well as special factors need to be assessed. Among other things it should also be taken into account whether infringement or the extent of infringement can also be proven by other information or evidence, which is not confidential. In any case Member States should put in place a mechanism according to which the information requested should be reviewed, assessed and evaluated before it is disclosed to the applicant. This mechanism can, for example, be a court or an independent expert sworn to secrecy. The issue of whether or not the information requested should be disclosed to the applicant at all should also be assessed. 12.95 According to Article 7(1) the applicant does not need to specify the evidence requested. This derives from the wording of the provision, which differs from that of Article 6(1), which makes express reference to ‘specified evidence’. What, however, is not clear is how general the application should be with regard to the requested evidence and whether ‘fishing for evidence’ is also allowed. Commentators seem to suggest that this is the very aim of the provision.83 Yet, one cannot expect

81

82 83

Many EU Member States have opted for non-implementation of description orders, which are usually available in criminal proceedings (e.g. Czech Republic, Greece, Hungary, Malta and Poland), Report II, 6. Although clearly existing under Art. 7 of the Directive, the possibility of providing for description orders in a civil law context is, indeed, controversial: see F.G. Wilman, 517. Recital 24: ‘[…] These corrective measures should take account of the interests of third parties including, in particular, consumers and private parties acting in good faith’. Walter and Goebel, 1253 and R. Knaak 745, 748.

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many national courts to allow for such general applications for evidence, especially when this departs from their legal traditions (as the case is with UK, French and Greek law). It therefore seems more logical to assume that at least some plausible allegations should be made as to the potential pieces of evidence that can be found in the defendant’s possession.84 Measures for the preservation of evidence can also be ordered inaudita altera parte. That means 12.96 without the other party against which the measure is ordered having been heard. Ex parte measures significantly affect the defendant’s fundamental right to a fair trial enshrined in Article 47 of the EU’s Charter of Fundamental Rights, which includes his/her fundamental right to be heard and defend himself/herself in court. Limitations to the right to be heard should therefore in principle only be imposed under Article 7(1) of the Directive while providing for the necessary safeguards and to the extent that such limitations are necessary to ensure the rights to protection of IP and to effective judicial protection of the applicant. Some Member States (such as Germany) provide for the instrument of protective brief (also called protective letter or protective writ). With such a brief, a defendant fearing being sued for an IP right infringement (e.g. upon receiving a cease-and-desist letter from the right holder) informs the competent judicial authorities, even before an application has been made, why the potential infringement claim is allegedly not founded. In the Commission’s view, protective briefs can be seen as a good instrument to strike a fair balance between the various conflicting interests and fundamental rights at issue in relation to the possibility of issuing ex parte measures set out in the Directive.85 Article 7(1) does not stipulate exhaustively the circumstances for the ex parte ordering of a measure. 12.97 It only indicates that the ex parte ordering of a measure may take place particularly where any delay is likely to cause irreparable harm to the right holder or where there is a demonstrable risk of evidence being destroyed. That means that this measure should be subject to additional guarantees and should be ordered when circumstances such as the ones indicated in this provision apply. In essence, however, it should not be difficult to prove that ‘delay is likely to cause irreparable harm to the rightholder’ or that there is ‘a demonstrable risk of evidence being destroyed’. When one has evidence in one’s possession that proves the alleged infringer’s guilt, it is very likely that the longer this evidence remains with her/him the larger the risk is that this evidence is destroyed. It is only logical to assume that the provision also extends to circumstances in which the evidence – although not destroyed – may be concealed, hidden or transferred to third parties. Although Article 7 does not make any specific reference to sanctions relating to non-compliance by 12.98 the defendant, it can be assumed that if the defendant fails to comply s/he can be forced to do so on the basis of recurring fines or imprisonment as these may be provided in Member State’s laws concerning contempt proceedings. Where such measures are ordered, the parties against which such order is made should be given 12.99 notice, without delay and in any case at the latest after the execution of the measures. These parties may also apply for a review of the measure, including the right to be heard. In the course of this review the court may decide whether the measures should be modified, revoked or confirmed.

3. Article 7(2) Given the fact that the measures indicated in Article 7(1) are ordered on the basis of reasonably 12.100 available evidence only, courts may provide for the lodging by the applicant of adequate security or an equivalent assurance intended to ensure compensation for any prejudice suffered by the

84 85

Walter and Goebel, 1253, fn 243. Guidance, 15–16.

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defendant. Provision for such compensation is made in Article 7(4). Adequate security may also take the form of an amount of money deposited with the court or other authority indicated by the court, a bank guarantee or other. On the one hand, such securities or assurances are an important instrument not only to compensate for possible injury ex post where necessary, but also to prevent potential abuse of the measures provided for by the Directive (Art. 3(2)). On the other hand, the security requested should not be such so as to be deemed ‘unnecessarily complicated and costly’ (Art. 3(1)) or to exclude the right holder from the measure. Bank guarantees accepted only from banks established in the Member State where application for the measure is made could form an example of such a complicated procedure. Courts are free to decide the cases where such a security is deemed necessary taking into account the particular facts of each case such as the weakness of the case at issue, the applicant’s financial position, the severity of the measure applied for and the potential effects for the effectiveness thereof, the damage that may be caused to the defendant, and so on.86

4. Article 7(3) 12.101 According to paragraph 3 the defendant may request that the measure is revoked or otherwise ceases to have effect, if the right holder/applicant does not institute – within a reasonable period of time – proceedings leading to a decision on the merits of the case before the competent court. This provision is there to ensure that the measure is not used by the right holder abusively or in such a way so as to substitute proceedings on the merits of the case (capable of examining in depth and substance whether the infringement has actually taken place). The ‘reasonable period’ is for the national court to decide where Member States’ laws allow courts to determine such a period. If such judicial determination is not provided for or allowed by the law of the Member State at issue an inflexible period not exceeding 20 working days or 31 calendar days – whichever is the longer – is provided for in paragraph 3. This provision does not stipulate how this period is to be calculated. Yet, the CJEU provides for guidance in this respect in relation to the equivalent provision of Article 50(6) of the TRIPs Agreement.87 Thus, if no special provision is made in the law of the Member State concerned then the period is to be calculated from the date of the execution of the measure ordered. Although this period may be considered tight, in practice, this will rarely be so. The reason is that the provision requires that proceedings are instituted, i.e. an application is submitted or a suit is filed with the court. Until the actual hearing takes place a lot more time is required. If the parties have not reached a settlement until then it is usually up to them to ask the courts for an extension. This limited period is there to ensure undue and abusive delays from the part of the right holders who can step back and procrastinate once they have acquired all the evidence sought for. This time limit should also be construed so as to apply in cases where something else is not provided in national laws and not as the absolute maximum provided by the Directive.88

5. Article 7(4) 12.102 If the measure is revoked, lapses due to an act or omission by the applicant, such as the failure to institute proceedings on the merits of the case, or if it is subsequently found that there has been no infringement or threat of infringement, damages/compensation can be claimed by any party affected by the provisional measure. This should be understood as any sort of damage that is related to the application of the measure including loss of profits, secondary or subsequent damages or moral prejudice. Damages can be claimed irrespective of whether the applicant knew that no infringement or threat of infringement was there or was simply negligent. This, however, may be a factor taken into account for the calculation of the appropriate compensation. Such compensation may also

86 87 88

Guidance, 14–15. Case C-89/99 Schieving-Nijstad, ECLI:EU:C:2001:438. Walter and Goebel, 1255, fns 252 and 253.

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include restitution of the status quo ante by returning, for example, seized evidence to the defendant or preventing the applicant from using any information acquired under the application of the measure.89 The compensation measures laid down in Article 7(4) constitute guarantees, which the legislature 12.103 deemed necessary as a counterweight to the prompt and effective provisional measures for which it made provision.90 Although Recital 11 provides that ‘[the Enforcement] Directive does not aim to establish 12.104 harmonised rules for judicial cooperation, jurisdiction, the recognition and enforcement of decisions in civil and commercial matters, or deal with applicable law’ it also makes reference to the fact that ‘[t]here are Community instruments which govern such matters in general terms and are, in principle, equally applicable to intellectual property’. Such a legal instrument is Regulation 1206/2001 on cooperation between the courts of the Member States in the taking of evidence in civil or commercial matters.91 This Regulation in conjunction with the Opinion of Advocate General Kokott (18 July 2007) in the case C-175/06 Alessandro Tedesco v Tomasoni Fittings and RWO Marine Equipment (with regard to a measure concerning the description of goods),92 and the judgments in Cases C-104/03 St Paul Diary v Unibel 93 and C-170/11 Lippens and Others94 lead us to the conclusion that measures aiming at the preservation of evidence fall within the scope of the Regulation dealing with cross-border cases.95 That means that upon request by the court of one Member State the court of the other Member State must execute/order the measures requested by the first court unless grounds for refusal exist.96 Thus in a case where infringing goods have been manufactured in one Member State and imported for distribution into another, the court of the Member State where proceedings for an IP infringement are pending may request the court of the other Member State to order measures for preserving evidence. These measures may include the hearing of witnesses, descriptions of goods or seizures concerning infringing articles, documents or information evidencing the infringement.

89 90 91 92 93 94 95

Walter and Goebel, 1254; W. Tilmann [2005] GRUR 737, 739 et seq. Case C-681/13 Diageo Brands v Simiramida-04 EOOD, ECLI:EU:C:2015:471, para. 74. OJ L174/1, 28.05.2001. ECLI:EU:C:2007:451. This case never resulted in a ruling since it was removed from the register of the Court by order of 27 September 2007 because the parties had reached a settlement (ECLI:EU:C:2007:552). 28 April 2005, ECLI:EU:C:2005:255. 6 September 2012, ECLI:EU:C:2012:540. According to Report II, 8, it could be very useful to improve the free circulation of measures ordered ex parte within the EU. Necessary steps in this regard are being undertaken in the context of the upcoming revision of Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Brussels I Regulation). Gathering evidence in relation to the infringements committed via the Internet is becoming another significant problem.

96

Regulation (EC) 44/2001 has been amended several times, before being repealed and replaced by Regulation (EU) 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (OJ L 351/1, 20.12.2012). See Chapter 24. See Opinion of Advocate General Kokott (18 July 2007) in the case C-175/06 Alessandro Tedesco v Tomasoni Fittings and RWO Marine Equipment, at para. 94: [I]t may be observed that the description of goods within the meaning of Articles 128 and 130 of the CPI, the performance of which is sought by the Tribunale Civile di Genova, constitutes a measure for the taking of evidence in accordance with Article 1 of Regulation No 1206/2001. The requested court ought to perform that request, provided that the measures are described with adequate precision such that the link between the evidence to be taken and the proceedings (where applicable, contemplated) can be identified and no grounds for refusal exist.

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6. Article 7(5) 12.105 Article 7(5) is an optional provision providing that Member States may provide for measures to protect witnesses’ identity.97 It is also a ‘TRIPs Plus’ element and is not provided for in any other EU or international IP instrument. This provision does not seem to add a lot with regard to provisional measures concerning the preservation of evidence and seems to be of a rather limited practical importance. One may assume that it was placed there for instances where witnesses are willing to provide information for alleged infringements to the courts without running the risk that their identity is revealed.98 This would particularly be the case where such a witness is an employee or used to be the infringer’s employee or is bound by a confidentiality agreement. It is, however, hard to imagine situations where the court would accept such a testimony as the only ‘reasonably available evidence’ in the circumstances and would order a measure on the basis of this evidence alone. This would also bring the defendant into the unfair situation where he could not defend himself against information because he cannot find out where and from whom it originates and what the credibility of this person is. This provision should, therefore, be approached with caution.

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). Regulation 1206/2001 on cooperation between the courts of the Member States in the taking of evidence in civil or commercial matters, OJ L 174/1, 28.05.2001. See also related instruments at Art. 1.

2. CJEU case law Alessandro Tedesco v Tomasoni Fittings and RWO Marine Equipment (C-175/06), ECLI:EU:C:2007:451. Diageo Brand BV v Simiramida-04 EOOD (C-681/13), ECLI:EU:C:2015:471. Lippens and Others (C-170/11), ECLI:EU:C:2012:540. St Paul Dairy v Unibel (C-104/03), ECLI:EU:C:2005:255. Schieving-Nijstad (Case C-89/99), ECLI:EU:C:2001:438. See also CJEU case law at Art. 1.

3. Bibliography Knaak, R. ‘Die EG-Richtlinie zur Durchsetzung der Rechte des geistigen Eigentums und ihr Umsetzungsbedarf im deutschen Recht’, (2004) GRUR Int, 53(9), 745–750. Tilmann, W. ‘Beweissicherung nach Art. 7 der Richtlinie zur Durchsetzung der Rechte des geistigen Eigentums’ (2005) GRUR Int, 737. Wilman, F.G. ‘A decade of private enforcement of intellectual property rights under IPR Enforcement Directive 2004/48: where do we stand (and where might we go)?’ (2017) E.L. Rev. 42(4), 509. See also Bibliography at Art. 1.

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This provision is often used in EU Member States in the context of criminal rather than civil proceedings (Report II, 8). According to Reinbothe, 15, this provision on witness protection focuses on organised crime. Regarding the fact that counterfeiting and piracy appear to be increasingly linked to organised crime, see Chapter 21, para. 21.88.

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SECTION 3 RIGHT OF INFORMATION ARTICLE 8: RIGHT OF INFORMATION 1.

2.

3.

Member States shall ensure that, in the context of proceedings concerning an infringement of an intellectual property right and in response to a justified and proportionate request of the claimant, the competent judicial authorities may order that information on the origin and distribution networks of the goods or services which infringe an intellectual property right be provided by the infringer and/or any other person who: (a) was found in possession of the infringing goods on a commercial scale; (b) was found to be using the infringing services on a commercial scale; (c) was found to be providing on a commercial scale services used in infringing activities; or (d) was indicated by the person referred to in point (a), (b) or (c) as being involved in the production, manufacture or distribution of the goods or the provision of the services. The information referred to in paragraph 1 shall, as appropriate, comprise: (a) the names and addresses of the producers, manufacturers, distributors, suppliers and other previous holders of the goods or services, as well as the intended wholesalers and retailers; (b) information on the quantities produced, manufactured, delivered, received or ordered, as well as the price obtained for the goods or services in question. Paragraphs 1 and 2 shall apply without prejudice to other statutory provisions which: (a) grant the rightholder rights to receive fuller information; (b) govern the use in civil or criminal proceedings of the information communicated pursuant to this Article; (c) govern responsibility for misuse of the right of information; or (d) afford an opportunity for refusing to provide information which would force the person referred to in paragraph 1 to admit to his/her own participation or that of his/her close relatives in an infringement of an intellectual property right; or (e) govern the protection of confidentiality of information sources or the processing of personal data.

SELECTED RECITALS (2) The protection of intellectual property should allow the inventor or creator to derive a legitimate profit from his/her invention or creation. It should also allow the widest possible dissemination of works, ideas and new know-how. At the same time, it should not hamper freedom of expression, the free movement of information, or the protection of personal data, including on the Internet. (14) The measures provided for in Articles 6(2), 8(1) and 9(2) need to be applied only in respect of acts carried out on a commercial scale. This is without prejudice to the possibility for Member States to apply those measures also in respect of other acts. Acts carried out on a commercial scale are those carried out for direct or indirect economic or commercial advantage; this would normally exclude acts carried out by end-consumers acting in good faith. (15) This Directive should not affect substantive law on intellectual property, Directive 95/ 46/EC of 24 October 1995 of the European Parliament and of the Council on the protection of individuals with regard to the processing of personal data and on the free movement of such

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data, Directive 1999/93/EC of the European Parliament and of the Council of 13 December 1999 on a Community framework for electronic signatures and Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market. (20) Given that evidence is an element of paramount importance for establishing the infringement of intellectual property rights, it is appropriate to ensure that effective means of presenting, obtaining and preserving evidence are available. The procedures should have regard to the rights of the defence and provide the necessary guarantees, including the protection of confidential information. For infringements committed on a commercial scale it is also important that the courts may order access, where appropriate, to banking, financial or commercial documents under the control of the alleged infringer. (21) Other measures designed to ensure a high level of protection exist in certain Member States and should be made available in all the Member States. This is the case with the right of information, which allows precise information to be obtained on the origin of the infringing goods or services, the distribution channels and the identity of any third parties involved in the infringement.

RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT ARTICLE 47: RIGHT OF INFORMATION Members may provide that the judicial authorities shall have the authority, unless this would be out of proportion to the seriousness of the infringement, to order the infringer to inform the right holder of the identity of third persons involved in the production and distribution of the infringing goods or services and of their channels of distribution.

I. COMMENTARY 1. Introduction 12.106 The right of information is one of the most fundamental provisions of the Enforcement Directive and a key element for the effective combat of IP infringements, and more specifically for counterfeiting and piracy.99 First, it allows identification of the persons involved in the infringing activities (not only those at the end of the distribution chain but also those ‘behind the scenes’ as part of a complex distribution network). Second, it allows the gathering of information about the quantities produced and the price obtained.100 It thus aims to implement the fundamental right to an effective remedy guaranteed under Article 47 of the EU’s Charter of Fundamental Rights, which is a necessary instrument for ensuring the effective exercise of the fundamental right to protection of

99

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Case C-427/15 New Wave as v Alltoys spol s.r.o., ECLI:EU:C:2017:18, para. 25; Case C-580/13 Coty Germany v Stadtsparkasse Magdeburg, ECLI:EU:C:2015:485, para. 29. For more information on the information right see ‘Evidence and Right of Information in Intellectual Property Rights’, Study by the European Observatory on Counterfeiting and Piracy (2010), https://euipo.europa.eu/ohimportal/documents/11370/80606/Evidence+and+ right+of+information+in+Intellectual+Property+rights/9cce8f61-35a1-4e66-b9a4-3e730c09307c. Report II, 11.

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IP provided for in Article 17(2) thereof.101 This Article, which has been modelled on the pre-existing laws of some Member States (e.g. the Benelux countries and Germany), has been one of the most controversial Articles during the negotiations of the Directive. Its origins are found in a suggestion with regard to a proposal for a Design Directive (which was later dropped)102 and in the 1998 Green Paper on Combating Counterfeiting and Piracy in the Internal Market.103 Its kin is found in Article 47 of the TRIPs Agreement. Yet, Article 8 clearly goes substantially further than that and in this sense it is considered to be a ‘TRIPs Plus’ provision. More specifically according to Article 47 of the TRIPs Agreement parties are under no obligation 12.107 to provide for a right of information in their national laws (‘may’). Even when they do so this right is only provided to the right holder against the infringer in relation to the identity of third persons involved in the production and distribution of the infringing goods or services and of their channels of distribution. Article 8, on the contrary, is mandatory. In other words Member States are obliged to introduce it 12.108 into their national laws. Yet, it is up to the courts to decide each time whether to order the disclosure of the information requested by the claimant. This disclosure may take place on the basis of a justified and proportionate request of the claimant. Thus the right of information granted to right holders needs to be at the same time ‘effective and dissuasive’ (Art. 3(2)) as well as ‘proportionate’. Consequently, any order by the competent judicial authorities to provide information issued under Article 8 should only concern information which is actually needed to identify the source and scope of the infringement.104 Nevertheless, it is rather extensive in the sense that it covers a variety of persons in relation to a variety of acts, as will be discussed below.

2. Article 8(1) The claim introduced by Article 8 seems to be a substantive claim rather than a procedural one. 12.109 That means that the right holder can file a suit – independently from any other procedure – in order to request information from a particular person. This suit or request does not need to take place as part of pending proceedings concerning IP infringement. The right of information can also be exercised after the conclusion of the infringement proceedings with a finding of an infringement (e.g. with a view to bringing an action for damages).105 It has been argued that it can also be invoked before the proceedings concerning an infringement have been concluded or even initiated.106 This conclusion is not uncontested. It might, however, find some support in the wording and the legislative history of the provision. More specifically, paragraph 1 reads ‘in the context of proceedings concerning an infringement of an intellectual property right’ rather than ‘in the course’ of such proceedings. This wording is the result of a change made to the initial proposal to the Directive, which used the wording ‘in order to deal with proceedings involving an infringement of 101 102 103 104 105 106

F.G. Wilman, 518; Case C-427/15 New Wave as v Alltoys spol s.r.o., ECLI:EU:C:2017:18, para. 25. Article 16(a) of the Amended Proposal for a Directive on the legal protection of designs, COM (96) 66 final, 21.02.1996. See also Initial Proposal Explanatory Memorandum, 21. Green Paper on Combating Counterfeiting and Piracy in the Internal Market, COM (98) 569 final, 15.10.1998, 21. Guidance, 11. Case C-427/15 New Wave as v Alltoys spol s.r.o., ECLI:EU:C:2017:18, para. 27. The situation differs from one Member State to another, with some providing that the right of information should be denied unless a judgment on the merits of the infringement claim has been rendered, and others providing that it should also be recognised in the framework of preliminary proceedings. According to J.L.R.A. Huydecoper (‘Nous maintiendrons – De nieuwe “Richtlijn Handhaving”’ (2004) AMI, 4, 119) the second interpretation should prevail. V. Fossoul (‘The Right of Information: An Illustration of the Conflict Between Data Protection and the Enforcement of Intellectual Property Rights’ (2013) BMM Bulletin, 1, 11) further emphasises that, since infringement proceedings on the merits can be time-consuming in most Member States, to require a prior judgment on the infringement would have as a consequence that the requested information will often no longer be available once the order is granted, due to the lack of obligation on internet service providers to retain data for a minimum period of time.

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an intellectual property right’.107 It is submitted that this change in wording aimed at clarifying that the claim was not to take place ‘during’ infringement proceedings but rather ‘with respect to’ such proceedings. Although the provision refers to the ‘infringer’ rather than the ‘alleged infringer’ (as the case is in Recital 20), it can be argued that infringement need not be definitely proven. If that were not the case then it would make no sense for this Article to also provide for the obligation of third parties to provide information, especially since this Article is intended to also operate in cases where the infringer is still unknown. There may be cases where information is requested from a third party – and not the infringer himself – in order for the right holder to be able to identify the infringer against whom he wants to file a suit. In any case, however, the claim for the disclosure of information is not a stand-alone claim and needs to be made in the context of and with regard to an infringement of intellectual property rights. 12.110 Article 8(1) sets out the persons obliged to provide information. First and foremost is the infringer. The notion of ‘infringer’ (meaning liable for IP infringement) will necessarily be subject to the national law at issue and encompasses both primary and secondary infringements or else direct or indirect/vicarious infringements. End-users or consumers may also be included if national law provides for their liability. 12.111 The infringer is obliged to provide any information whatsoever concerning ‘the origin and distribution networks of the goods or services which infringe an intellectual property right’. This is an express reference to an extended information right in the sense that the infringer is obliged to disclose and submit any information or detail relating not only to his personal activities but to all channels of distribution of goods and the entire network of the provision of services, upstream and downstream, as well as all acts and persons involved in them (e.g. producers, manufacturers, marketers, suppliers, distributors, wholesalers, retailers or other handlers of goods and services) irrespective of whether these persons were (or are) liable or not and irrespective of whether these acts were infringing acts or not. In other words, mere facilitating acts may also be included. 12.112 The infringer’s obligation to provide information is unconditional. That means that it is not linked to any requirement or prerequisite and her or his acts (i.e. the infringement) need not have taken place on a commercial scale. 12.113 There is, however, an exception with regard to banking, financial or commercial documents under the control of the (alleged) infringer. These documents may be ordered by the courts, where appropriate, for infringements committed only on a commercial scale. 12.114 Third persons (referred to in the article as ‘any other person’) are also obliged to provide information in the following cases: if they are found (a) in possession of the infringing goods on a commercial scale or (b) to be using the infringing services on a commercial scale or (c) to be providing on a commercial scale services used in infringing activities. The services offered by ISPs, and banking institutions, for example, come within the scope of this provision.108 ‘Any other person’ could potentially include distributors, suppliers or wholesalers in possession of infringing goods, for example. It is important to note that in all those cases ‘acting on a commercial scale’ is a prerequisite (i.e. in relation to acts carried out for direct or indirect economic or commercial advantage; this would normally exclude acts carried out by end-consumers acting in good faith (Recital 14)). The ‘commercial scale’ prerequisite also applies to Articles 6(2) and 9(2). Yet, since this Article works as

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Art. 9(1) of the initial proposal. Case C-275/06 Productores de Música de España (Promusicae) v Telefónica de España SAU, ECLI:EU:C:2008:54; Case C-461/10 Bonnier Audio AB, Earbooks AB, Norstedts Förlagsgrupp AB, Piratförlaget AB, Storyside AB v Perfect Communication Sweden AB, ECLI:EU:C:2012:219; Case C-580/13 Coty Germany v Stadtsparkasse Magdeburg, ECLI: EU:C:2015:485.

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a de minimis rule Member States are free to provide for a right of information in other cases, too, or not to provide for the ‘commercial scale’ prerequisite.109 This is also made clear in Article 8(3), which will be examined later. What needs to be noted here is that the persons obliged to provide information under this provision – although required to act on a commercial scale – need not themselves be infringers. The claimant need only to justify that they act within the scope of the provision, i.e. the goods or services possessed, used or provided by them infringe the right holder’s IP rights. Also the information provided need not refer to (third) persons acting themselves on a commercial scale. It is only the ‘provider’ of the information that needs to act on a commercial scale and not the person for whom information is provided. Article 8(1)(d) contains a provision which renders the right of information even more extensive. If 12.115 one of the persons referred to above provides information for another person ‘as being involved in the production, manufacture or distribution of the goods or the provision of the services’ this other person is under an obligation to provide information irrespective of whether her or his acts have taken place on a commercial scale. That means that anyone involved – at some stage (since a person may no longer be involved if, for example, that person no longer has the goods in his possession) – in the production, manufacturing or distribution channels is obliged to provide information for all persons involved.

3. Article 8(2) The information to be provided is indicated (and not set out exhaustively) in Article 8(2) as 12.116 comprising (a) the names and addresses of the producers, manufacturers, distributors, suppliers and other previous holders of the goods or services, as well as the intended wholesalers and retailers (i.e. of all persons involved) and (b) information on the quantities produced, manufactured, delivered, received or ordered, as well as the price obtained for the goods or services in question. The term ‘addresses’ contained in that provision only refers to postal addresses (which shows that the Directive was not designed with the aim of combatting online infringements of IP rights). It follows that the Member States are not obliged, under Article 8(2)(a) of the Directive, to provide for the possibility for the competent judicial authorities to order disclosure of the email address, telephone number or IP address of the persons referred to in that provision in proceedings concerning an infringement of an intellectual property right. Yet, since the Directive only provides for minimum harmonisation concerning the enforcement of IP rights, the Member States do have such an option. Indeed, as is clear from the wording of Article 8(3)(a) of the Directive, the EU legislature expressly provided for the possibility for the Member States to grant holders of IP rights the right to receive fuller information, provided, however, that a fair balance is struck between the various fundamental rights involved and compliance with the other general principles of EU law, such as the principle of proportionality.110 One may notice that the information set out indicatively in paragraph 1 of Article 8(2) refers to the basic information required in order for one to locate the infringer(s) (or the person(s) needed to provide further information) and at the same time acquire the facts needed in order to base any claims for compensation. On top of that further information may also be required for the calculation of damages, lost profits and related claims such as destruction of goods, closing down of the website and so on.

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A considerable number of EU Member States have provided for this measure for all infringements and not only for those committed on a ‘commercial scale’, e.g. Denmark, Estonia, Greece, France, Lithuania, Slovak Republic. Report II, 5. In others, it appears that when the information request is directed towards a third party, the commercial scale requirement is applied but such requirement is not imposed if the information is requested from the alleged infringer (e.g. Belgium, Germany, Hungary, Luxemburg, Poland). Report II, 11. Case C-264/19 Constantin Film Verleih v YouTube and Google, ECLI:EU:C:2020:542, paras. 25–40.

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4. Article 8(3) 12.117 Article 8(3)(a) provides that more favourable (national) statutory provisions may apply with regard to the right of information on the basis of which the claimant may receive fuller information (i.e. more types or extent of information). This is also in accordance with Article 2(1), which also refers to EU legislation. The fact, however, that Article 8(3)(a) refers to national law only should not be interpreted as leaving out obligations deriving from EU law since the national law of the Member States should reflect the acquis communautaire as this is enshrined in the relevant EU legal instruments. Recital 21 makes a particular reference to the right of information and sets out that other measures providing a high level of protection, which exist in certain Member States, should be made available in all Member States. 12.118 Article 8(3)(b)–(e) provides for safeguards with regard to the obtaining and use of the information, which in fact may limit this right. 12.119 National law may provide for how information acquired under Article 8(1) is to be used in civil or criminal proceedings (Art. 8(3)(b)). This limitation is of a rather procedural nature and allows Member States to make provision as to how particular information is to be used in the course of proceedings (e.g. the weight or validity of electronic documentation or written statements in court proceedings, issues of examination of witnesses, how confidential information is to be used, what information constitutes evidence for the court, what constitutes general or incomplete information and therefore cannot be considered as proof in the case at issue and so on). Any other interpretation would make no sense since it would render the right of information inoperative and would defy the very purpose of Article 8, which among others is also the gathering of information to be used in infringement proceedings. 12.120 Article 8(3)(c) provides that national law may not allow one to use information acquired under this procedure for reasons, for example, other than those set out in the Directive. Such use may be considered as a ‘misuse’ or even abuse of the right of information for which national law may provide sanctions or remedies. 12.121 Prohibition of self-incrimination is another issue that could be taken into account. National law may allow one to decline providing information, which would force one to admit her or his own participation or that of her or his close relatives in an infringement case (Art. 8(3)(d)). This is a principle found in the laws of many Member States that one cannot expect a person to incriminate himself or his relatives. One would assume that one could use this as a basis in order to deny the disclosure of information. This, however, is not the aim of the provision. Such an interpretation would render the right of information towards the infringer meaningless. This provision should be rather approached on the basis that the defendant (alleged infringer) is under no obligation to prove that he is an infringer. It will be for the claimant to prove the alleged infringer’s involvement in the case at issue (i.e. the burden of proof lies with the claimant). Once involvement is proven then the infringer is obliged to provide all necessary information. 12.122 National law on confidentiality and personal data can also be taken into account (see also Recital 2). Relevant in this respect are also Article 2(3)(a) and Recital 15, which provide for a number of Directives that should not be affected by the Enforcement Directive. These Directives include Directive 95/46 on the protection of individuals with regard to the processing of personal data and on the free movement of such data (which has in the meantime been repealed and replaced by the General Data Protection Regulation111) and Directive 2000/31 on electronic commerce. It is

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interesting to note that Directive 2002/58 on personal data and the protection of privacy in the electronic communications sector is not mentioned. This, however, does not mean that it does not apply. This point was clarified by the CJEU in Promusicae v Telefonica and reiterated in further judgments in this respect.112 The issue which arises here is whether Member States should oblige ISPs to store the data necessary in order to provide right holders with appropriate information for a certain period of time. According to the CJEU’s case law Article 5(1)(g) of General Data Protection Regulation (formerly Art. 13(1)(g) of Directive 95/46) applies in conformity with what is provided in Article 15(1) of Directive 2002/58 (i.e. Member States may provide for the retention of data for a limited period for the prevention, investigation, detection and prosecution of criminal offences or unauthorised use of the electronic communication system, as referred to in Art. 13(1) of Directive 95/46).113 Apart from the aforementioned Directives, other rights found in the acquis communautaire can also 12.123 apply such as fundamental rights as these rights are enshrined in the Charter of Fundamental Rights.114 There may be no express reference to them but as it was demonstrated by the CJEU in a series of cases relating to the disclosure of information from ISPs to right holders115 a balance has to be struck between on the one hand the rights to property (including intellectual property) and to an effective remedy, and on the other hand the right to privacy (including data protection). The balance needs to be struck at national level, while the principle of proportionality needs to be taken into account. That, of course, means that Member States are free to decide how and the extent to which a right to information (which should be introduced mandatorily in their national laws) will operate. Especially in the area of ISPs, different solutions will be followed (as they are already) in different Member States as well as different interpretations being attempted. The Member States’ considerable leeway in this area has also been confirmed by the CJEU’s case law.116 Confidentiality is repeated in Recital 20 according to which ‘procedures should have regard to the 12.124 rights of the defence and provide the necessary guarantees, including the protection of confidential information’ (see below section 5, which follows, on ‘conflicts between copyright protection and privacy in the light of the case law of the Court of Justice of the European Union concerning ISPs’).117

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C-275/06 Productores de Música de España (Promusicae) v Telefónica de España SAU ECLI:EU:C:2008:54; C-557/07 LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH [ECLI: EU:C:2009:107; C-70/10 Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) ECLI:EU:C:2011:771; C-360/10 Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV ECLI:EU:C:2012:85; Case C-461/10 Bonnier Audio AB, Earbooks AB, Norstedts Förlagsgrupp AB, Piratförlaget AB, Storyside AB v Perfect Communication Sweden AB, ECLI:EU:C:2012:219. C-461/10 Bonnier Audio AB, Earbooks AB, Norstedts Förlagsgrupp AB, Piratförlaget AB, Storyside AB v Perfect Communication Sweden AB, ECLI:EU:C:2012:219. Arts 7, 8 and 17(2), Charter of Fundamental Rights of the European Union (2000/C 364/01), OJ C 364/1, 18.12.2000. See Chapter 21, paras. 21.162–21.173. Ibid. In some Member States the right of information provided for in the Directive seems to be granted very restrictively, mainly due to national laws on the protection and retention of personal data (examples are, according to the 2009 Study on Online Copyright Enforcement and Data Protection in Selected Member States (Hunton & Williams, Brussels, http://ec.europa.eu/internal_market/iprenforcement/docs/study-online-enforcement_en.pdf), Austria and Spain, as reported in Report I, 7). For national case law see the Hellenic Copyright Organization’s Comparative Report on Legislation and Cases Concerning Copyright Infringements on the Internet and the Role of Internet Service Providers (in Greek), www.opi.gr. Member States’ practice, on the one hand, shows that the protection of confidential information does not mean that access to confidential information cannot be part of provisional measures. On the other hand, access to confidential information through provisional measures (by a search, seizure or an injunction) appears to be allowed only in cases where this information is truly necessary and where this information cannot be obtained by way of other (legal) means. Furthermore, a special procedure (e.g. hearing closed to the public) is usually applied when such confidential information is to be disclosed on top of a limitation to use this information only for the purposes of the proceedings. Report II, 10.

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12.125 National law provisions limiting the right of information need not only exist at the time of the implementation of the Directive into national law but they may also be introduced at any time during or after that. The fact that Article 8(3) provides that the right of information applies without prejudice to other statutory provisions (and names what these statutory provisions are) does not necessarily mean that Member States need to provide for them in their national laws or that they are in any form mandatory. 12.126 It is clear throughout Article 8 that proportionality should apply in relation to any measure ordered (i.e. the measure should be proportionate to the aim to be attained). This derives from paragraph 1, which refers to ‘a justified and proportionate request of the claimant’; from paragraph 2, which refers to information ‘as appropriate’; as well as from Article 3 and the Recitals (and especially Recitals 22 and 31) to the Directive.

5. Conflicts between copyright protection and privacy in the light of the case law of the CJEU concerning ISPs 12.127 A series of cases before the CJEU in the form of preliminary rulings have dealt with the issue of whether information concerning alleged infringers on the internet should be disclosed to right holders in order for them to pursue their rights in the civil courts or whether such disclosure should be prevented on the basis of privacy (data protection and secrecy of communications). The three Directives (Art. 1(5)(b) of Directive 2000/31, Art. 9 of Directive 2001/29 and Art. 8(3)(e) of Directive 2004/48) that were examined as having as their aim the effective protection of copyright were not found to supersede the protection afforded to personal data by the EU’s legal instruments regulating its requirements. Under Article 8(1) of the Enforcement Directive, in cases of infringement of an IP right and in response to a justified and proportionate request of the claimant, the competent judicial authorities may order that information on the origin and distribution networks of the goods or services, which infringe an IP right, be provided by the infringer and/or any other person under certain conditions. However, if these provisions are seen in conjunction with Article 8(3)(e) of the Enforcement Directive and Articles 15(2) and 18 of Directive 2000/31 or that of Article 8(1) and (2) of Directive 2001/29, one comes to the conclusion that Member States are under no obligation to provide for the communication of personal data in the context of civil proceedings. In Promusicae v Telefonica,118 the CJEU held that although Articles 41, 42 and 47 of the TRIPs Agreement (in the light of which EU law must be interpreted) require the effective protection of IP rights, they do not oblige Member States to provide for an obligation to communicate personal data in the context of civil proceedings.119 However, Article 8(3) does not preclude them either from imposing an obligation to disclose to certain private third parties personal 118

119

See Case C-275/06 Productores de Música de España (Promusicae) v Telefónica de España SAU, ECLI:EU:C:2008:54, para. 60. See also Cases C-557/07 LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH, ECLI:EU:C:2009:107, and C-461/10 Bonnier Audio AB, Earbooks AB, Norstedts Förlagsgrupp AB, Piratförlaget AB, Storyside AB v Perfect Communication Sweden AB, ECLI:EU:C:2012:219. Paragraphs 1 and 2 of Article 41 of the TRIPs Agreement provide that: 1.

2.

Members shall ensure that enforcement procedures as specified in this Part are available under their law so as to permit effective action against any act of infringement of intellectual property rights covered by this Agreement, including expeditious remedies to prevent infringements and remedies which constitute a deterrent to further infringements. These procedures shall be applied in such a manner as to avoid the creation of barriers to legitimate trade and to provide for safeguards against their abuse. Procedures concerning the enforcement of intellectual property rights shall be fair and equitable. They shall not be unnecessarily complicated or costly, or entail unreasonable time-limits or unwarranted delays.

Article 42 provides that: Members shall make available to right holders civil judicial procedures concerning the enforcement of any intellectual property right covered by this Agreement […]. Article 47 provides that:

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ARTICLE 47: RIGHT OF INFORMATION

data relating to internet traffic in order to enable such third parties to bring civil proceedings for copyright infringements.120 Therefore, the information on the origin and the distribution networks of infringing goods or services which the competent judicial authorities may require an infringer or certain other persons to provide can include personal data, where such disclosure occurs in compliance with the applicable legislation on the protection of personal data and provided that safeguards exist to ensure a fair balance between on the one hand the rights to property (including intellectual property) and to an effective remedy, and on the other hand the right to privacy (including data protection). In Bonnier Audio AB, the CJEU specified that the data protection rules anchored in EU law do not preclude the application of national legislation based on Article 8 of the Directive which, in order to identify an internet subscriber or user, permits an ISP in civil proceedings to give a copyright holder or its representative information on the subscriber to whom the ISP provided an IP address that was allegedly used in an infringement. However, such national legislation should enable the national courts seised to weigh the conflicting interests involved, on the basis of the facts of each case and taking due account of the requirements of the principle of proportionality.121 Similarly, the CJEU has held that Article 8(3)(e) of the Directive precludes a national provision 12.128 which allows, in an unlimited and unconditional manner, a banking institution to invoke banking secrecy in order to refuse to provide, pursuant to Article 8(1)(c) of that Directive, information concerning the name and address of an account holder.122 This does not mean that the need for the enforcement of IP rights must always prevail over the protection of the confidentiality of bank’s customers’ data. Rather, it clarifies that the Member States, when implementing Article 8(3)(e) into their national laws, are required to strike a fair balance between the two fundamental rights to which that provision refers, i.e. the right to protection of intellectual property and the right to protection of confidentiality and privacy. Those national provisions must set out the conditions for the exercise of banking secrecy in compliance with the fair balance requirement.123

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.6.2001. Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data, OJ L 281/31, 23.11.1995. Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector, OJ L 201/37, 31.07.2002. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market, OJ L 178/1, 17.07.2000.

120 121 122 123

Members may provide that the judicial authorities shall have the authority, unless this would be out of proportion to the seriousness of the infringement, to order the infringer to inform the right holder of the identity of third persons involved in the production and distribution of the infringing goods or services and of their channels of distribution. Case C-275/06 Productores de Música de España (Promusicae) v Telefónica de España SAU, ECLI:EU:C:2008:54, paras. 58–9. Case C-461/10 Bonnier Audio AB, Earbooks AB, Norstedts Förlagsgrupp AB, Piratförlaget AB, Storyside AB v Perfect Communication Sweden AB, ECLI:EU:C:2012:219, paras. 51–61. Case C-580/13 Coty Germany v Stadtsparkasse Magdeburg, ECLI:EU:C:2015:485, para. 43. M. Giannino, ‘Claims for non-economic damage by juristic persons’ (2015) 10 JIPLP, 11, 823.

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Chapter 12 THE ENFORCEMENT DIRECTIVE Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation), OJ L 119/1, 4.05.2016. See also related instruments at Art. 1.

2. CJEU case law Bastei Lübbe GmbH & Co. KG v Michael Strotzer (C-149/17), ECLI:EU:C:2018:841. Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV (C-360/10), ECLI:EU: C:2012:85. Bonnier Audio AB, Earbooks AB, Norstedts Förlagsgrupp AB, Piratförlaget AB, Storyside AB v Perfect Communication Sweden AB (C-461/10) ECLI:EU:C:2012:219. Constantin Film Verleih v YouTube and Google (C-264/19), ECLI:EU:C:2020:542. Coty Germany v Stadtsparkasse Magdeburg (C-580/13), ECLI:EU:C:2015:485. LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH (C-557/07), ECLI:EU:C:2009:107. New Wave as v Alltoys spol s.r.o. (C-427/15), ECLI:EU:C:2017:18. Productores de Música de España (Promusicae) v Telefónica de España SAU (C-275/06), ECLI:EU:C:2008:54. Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) (C-70/10), ECLI:EU: C:2011:771. See also CJEU case law at Art. 1.

3. Bibliography Ellard, D. ‘The EU’s IP Enforcement Directive’ (2004) Cri, 4, 65. Fossoul, V. ‘The right of information: an illustration of the conflict between data protection and the enforcement of intellectual property rights’ (2013) BMM Bulletin, 1, 11. Giannino, M. ‘Claims for non-economic damage by juristic persons’ (2015) 10 JIPLP, 11, 822. Giannino, M. ‘CJEU holds that right to information within Article 8 of Enforcement Directive can be asserted in separate proceedings’ (2017) 12 JIPLP, 8, 636. Huydecoper, J.L.R.A. ‘Nous maintiendrons – De nieuwe Richtlijn Handhaving’ (2004) AMI, 4, 119. Kamlah, D. ‘Banking secrecy does not have unlimited priority over the protection of intellectual property’ (2016) 11 JIPLP, 1, 61. Spisiak, D. ‘CJEU says that right of information survives earlier IP infringement proceedings’ (2017) 12 JIPLP, 4, 276. Stamatoudi, I. ‘The Role of Internet Service Providers. Ethics, Reality and the Law: The Example of Promusicae v. Telefonica ’, in Botti, M. (ed.) 8th International Conference, Computer Ethics: Philosophical Enquiry, Ionio University, Corfu, 26–28 June 2009, Nomiki Vivliothiki, Athens, 2009, 750. Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Information Law Series (B. Hugenholtz (general editor)), Wolters Kluwer Law & Business, Alphen aan den Rijn, 2010. Stamatoudi, I. ‘Data Protection, Secrecy of Communications and Copyright Protection. Conflicts and Convergences. The Example of Promusicae v. Telefonica’ in Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Information Law Series (B. Hugenholtz (general editor)), Kluwer Law International, Alphen aan den Rijn, 2010, 199. Stamatoudi, I. ‘ACTA, internet service providers and the acquis communautaire ’ in Rosén, J. (ed.), Intellectual Property at the Crossroads of Trade, ATRIP Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2012, 237. Stamatoudi, I. ‘Towards an updated EU enforcement Directive? Selected topics and problems’, 4th International Seminar on Information Law 2011, Aristotle University of Thessaloniki, University of Macedonia and Ionio University, Thessaloniki, 19–22 May 2011, Nomiki Vivliothiki, e-book. Stamatoudi, I. ‘Copyright enforcement and the role of internet service providers’ in Torremans, P. (ed.), The EU Enforcement Directive, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2014, 789. See also Bibliography at Art. 1.

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ARTICLE 9: PROVISIONAL AND PRECAUTIONARY MEASURES

SECTION 4 PROVISIONAL AND PRECAUTIONARY MEASURES ARTICLE 9: PROVISIONAL AND PRECAUTIONARY MEASURES 1.

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Member States shall ensure that the judicial authorities may, at the request of the applicant: (a) issue against the alleged infringer an interlocutory injunction intended to prevent any imminent infringement of an intellectual property right, or to forbid, on a provisional basis and subject, where appropriate, to a recurring penalty payment where provided for by national law, the continuation of the alleged infringements of that right, or to make such continuation subject to the lodging of guarantees intended to ensure the compensation of the rightholder; an interlocutory injunction may also be issued, under the same conditions, against an intermediary whose services are being used by a third party to infringe an intellectual property right; injunctions against intermediaries whose services are used by a third party to infringe a copyright or a related right are covered by Directive 2001/29/EC; (b) order the seizure or delivery up of the goods suspected of infringing an intellectual property right so as to prevent their entry into or movement within the channels of commerce. In the case of an infringement committed on a commercial scale, the Member States shall ensure that, if the injured party demonstrates circumstances likely to endanger the recovery of damages, the judicial authorities may order the precautionary seizure of the movable and immovable property of the alleged infringer, including the blocking of his/her bank accounts and other assets. To that end, the competent authorities may order the communication of bank, financial or commercial documents, or appropriate access to the relevant information. The judicial authorities shall, in respect of the measures referred to in paragraphs 1 and 2, have the authority to require the applicant to provide any reasonably available evidence in order to satisfy themselves with a sufficient degree of certainty that the applicant is the rightholder and that the applicant’s right is being infringed, or that such infringement is imminent. Member States shall ensure that the provisional measures referred to in paragraphs 1 and 2 may, in appropriate cases, be taken without the defendant having been heard, in particular where any delay would cause irreparable harm to the rightholder. In that event, the parties shall be so informed without delay after the execution of the measures at the latest. A review, including a right to be heard, shall take place upon request of the defendant with a view to deciding, within a reasonable time after notification of the measures, whether those measures shall be modified, revoked or confirmed. Member States shall ensure that the provisional measures referred to in paragraphs 1 and 2 are revoked or otherwise cease to have effect, upon request of the defendant, if the applicant does not institute, within a reasonable period, proceedings leading to a decision on the merits of the case before the competent judicial authority, the period to be determined by the judicial authority ordering the measures where the law of a Member State so permits or, in the absence of such determination, within a period not exceeding 20 working days or 31 calendar days, whichever is the longer. The competent judicial authorities may make the provisional measures referred to in paragraphs 1 and 2 subject to the lodging by the applicant of adequate security or an equivalent assurance intended to ensure compensation for any prejudice suffered by the defendant as provided for in paragraph 7. Where the provisional measures are revoked or where they lapse due to any act or omission by the applicant, or where it is subsequently found that there has been no infringement or

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Chapter 12 THE ENFORCEMENT DIRECTIVE

threat of infringement of an intellectual property right, the judicial authorities shall have the authority to order the applicant, upon request of the defendant, to provide the defendant appropriate compensation for any injury caused by those measures.

SELECTED RECITALS (14) The measures provided for in Articles 6(2), 8(1) and 9(2) need to be applied only in respect of acts carried out on a commercial scale. This is without prejudice to the possibility for Member States to apply those measures also in respect of other acts. Acts carried out on a commercial scale are those carried out for direct or indirect economic or commercial advantage; this would normally exclude acts carried out by end-consumers acting in good faith. (15) This Directive should not affect substantive law on intellectual property, Directive 95/ 46/EC of 24 October 1995 of the European Parliament and of the Council on the protection of individuals with regard to the processing of personal data and on the free movement of such data, Directive 1999/93/EC of the European Parliament and of the Council of 13 December 1999 on a Community framework for electronic signatures and Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market. (16) The provisions of this Directive should be without prejudice to the particular provisions for the enforcement of rights and on exceptions in the domain of copyright and related rights set out in Community instruments and notably those found in Council Directive 91/250/EEC of 14 May 1991 on the legal protection of computer programs or in Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society. (22) It is also essential to provide for provisional measures for the immediate termination of infringements, without awaiting a decision on the substance of the case, while observing the rights of the defence, ensuring the proportionality of the provisional measures as appropriate to the characteristics of the case in question and providing the guarantees needed to cover the costs and the injury caused to the defendant by an unjustified request. Such measures are particularly justified where any delay would cause irreparable harm to the holder of an intellectual property right. (23) Without prejudice to any other measures, procedures and remedies available, rightholders should have the possibility of applying for an injunction against an intermediary whose services are being used by a third party to infringe the rightholder’s industrial property right. The conditions and procedures relating to such injunctions should be left to the national law of the Member States. As far as infringements of copyright and related rights are concerned, a comprehensive level of harmonisation is already provided for in Directive 2001/29/EC. Article 8(3) of Directive 2001/29/EC should therefore not be affected by this Directive. (24) Depending on the particular case, and if justified by the circumstances, the measures, procedures and remedies to be provided for should include prohibitory measures aimed at preventing further infringements of intellectual property rights. Moreover there should be corrective measures, where appropriate at the expense of the infringer, such as the recall and definitive removal from the channels of commerce, or destruction, of the infringing goods and, in appropriate cases, of the materials and implements principally used in the creation or manufacture of these goods. These corrective measures should take account of the interests of third parties including, in particular, consumers and private parties acting in good faith.

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(25) Where an infringement is committed unintentionally and without negligence and where the corrective measures or injunctions provided for by this Directive would be disproportionate, Member States should have the option of providing for the possibility, in appropriate cases, of pecuniary compensation being awarded to the injured party as an alternative measure. However, where the commercial use of counterfeit goods or the supply of services would constitute an infringement of law other than intellectual property law or would be likely to harm consumers, such use or supply should remain prohibited.

RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT ARTICLE 50: PROVISIONAL MEASURES 1.

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The judicial authorities shall have the authority to order prompt and effective provisional measures: (a) to prevent an infringement of any intellectual property right from occurring, and in particular to prevent the entry into the channels of commerce in their jurisdiction of goods, including imported goods immediately after customs clearance; (b) to preserve relevant evidence in regard to the alleged infringement. The judicial authorities shall have the authority to adopt provisional measures inaudita altera parte where appropriate, in particular where any delay is likely to cause irreparable harm to the right holder, or where there is a demonstrable risk of evidence being destroyed. The judicial authorities shall have the authority to require the applicant to provide any reasonably available evidence in order to satisfy themselves with a sufficient degree of certainty that the applicant is the right holder and that the applicant’s right is being infringed or that such infringement is imminent, and to order the applicant to provide a security or equivalent assurance sufficient to protect the defendant and to prevent abuse. Where provisional measures have been adopted inaudita altera parte, the parties affected shall be given notice, without delay after the execution of the measures at the latest. A review, including a right to be heard, shall take place upon request of the defendant with a view to deciding, within a reasonable period after the notification of the measures, whether these measures shall be modified, revoked or confirmed. The applicant may be required to supply other information necessary for the identification of the goods concerned by the authority that will execute the provisional measures. Without prejudice to paragraph 4, provisional measures taken on the basis of paragraphs 1 and 2 shall, upon request by the defendant, be revoked or otherwise cease to have effect, if proceedings leading to a decision on the merits of the case are not initiated within a reasonable period, to be determined by the judicial authority ordering the measures where a Member’s law so permits or, in the absence of such a determination, not to exceed 20 working days or 31 calendar days, whichever is the longer. Where the provisional measures are revoked or where they lapse due to any act or omission by the applicant, or where it is subsequently found that there has been no infringement or threat of infringement of an intellectual property right, the judicial authorities shall have the authority to order the applicant, upon request of the defendant, to provide the defendant appropriate compensation for any injury caused by these measures. To the extent that any provisional measure can be ordered as a result of administrative procedures, such procedures shall conform to principles equivalent in substance to those set forth in this Section.

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I. COMMENTARY 1. Introduction 12.129 Article 9 deals with provisional measures aimed at preventing or stopping infringements. Interlocutory injunctions (Art. 9(1)(a)) should thus be distinguished from permanent ones, which are issued through a decision on the merits of the case (Art. 11). Provisional measures are also addressed in the Directive in Article 7 aimed, however, solely at preserving evidence. The Enforcement Directive deals with Articles 7 and 9 separately by reason of their different aims in contrast with Article 50 of the TRIPs Agreement, which deals with provisional measures in general. Although Article 9 has been modelled on the basis of Article 50 of the TRIPs Agreement, it contains a few ‘TRIPs Plus’ elements, which are discussed later on. 12.130 Provisional measures ensure fast relief for the right holders of IP rights and therefore are inextricably linked with effective protection. This is the reason the Directive renders them obligatory. These measures are in essence the cease and desist orders (cease and desist from infringing acts) known in many jurisdictions and are also provided against intermediaries whose services are being used by a third party to infringe an IP right. Article 9(2) also sets out precautionary measures relating to the seizure of the alleged infringer’s assets under certain circumstances and for infringements committed on a commercial scale. 12.131 Preliminary injunctions are ordered before any judgment on the merits, which takes place later on. The only precondition (for their ordering) is that the alleged infringement is imminent or continues to take place. The level of proof is dealt with under Article 9(3). 12.132 Regarding the scope of interlocutory injunctions, the (alleged) infringer can be forced to take measures to prevent an imminent infringement or to stop an ongoing one. It follows from Recital 17 that it is up to the competent judicial authorities to assess the application for injunctive relief by taking due account of the specific circumstances of the case. Since Article 9 does not set out the precise conditions that must be satisfied for the issuance of injunctive relief, it is primarily left to national law to define them. However, any injunction issued must be in accordance with the principle of proportionality and the other general requirements laid down in Article 3 of the Directive as well as the applicable fundamental rights. Thus, injunctions must be fair and proportionate and must not be excessively expensive and must not create barriers to legitimate trade. While any injunction issued should be effective, it should have the minimal scope necessary to achieve the objective of preventing an imminent infringement or forbidding the continuation of an infringement. The competent judicial authority should not issue injunctions which require the taking of measures that go beyond what is appropriate and necessary in light of the circumstances of the case at hand. 12.133 Member States’ national legislation differs widely regarding the scope of injunctions granted by the competent judicial authorities, in particular on the way in which it can address imminent or recurrent intellectual property infringements. According to the Commission’s Staff Working Document, which reviews current practice in EU Member States: [i]n the music and film sectors, injunctions often tend to be ‘title specific’. Rightholders therefore have to provide a full list of titles when asking for an injunction and the injunction will normally relate only to the indicated titles, while infringements with a view to titles not contained in the list can continue. Similar problems seem to exist with a view to the sale of counterfeit goods via online market places.124

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Report II, 17.

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ARTICLE 50: PROVISIONAL MEASURES

In some Member States, such as Ireland, however, injunctions can be issued requiring, for example, intermediaries to prevent further infringements of all rights held by a right holder or that are part of a licensee’s catalogue or repertoire, based on an established infringement of a sample of those rights. In most of them, however, such catalogue- or repertoire-wide injunctions are not available. The Enforcement Directive does not provide clear indications as to the compatibility with or need for such injunctions. Where it comes to injunctions against intermediaries, it follows from Recital 23 that the relevant conditions and procedures are in principle to be specified in national law.125 The same is true for so-called ‘dynamic’ or ‘forward-looking’ injunctions. These are injunctions that can be issued, for example, in cases in which materially the same website becomes available immediately after issuing the injunction with a different IP address or URL and which are drafted in a way that also allows cover for the new IP address or URL without the need to initiate a new judicial procedure to obtain a new injunction.126 Such measures can be enforced through recurring penalties against the alleged infringer who 12.134 violates the measure ordered.127 This is not obligatory and is only imposed if the Member State choses to do so. This, however, should be distinguished from a Member State’s obligation to provide for deterrent fines in case of the violation of the measure, which is dictated by the general obligation enshrined in Article 3(2) that the measures should be ‘effective’ and ‘dissuasive’. This Article leaves open whether these fines should be paid to the right owner (in the form of punitive damages) or to the State. In any case recurring payments are subject to the proportionality principle since they can be ordered only ‘where appropriate’. According to Article 9(1)(a) courts have the discretion to allow the continuation of the alleged infringement subject to the lodging of guarantees, which are intended to ensure the compensation of the right holder once infringement has been proved when the case is heard on the merits. This Article does not spell out the conditions for such a measure, which is left entirely to the court’s discretion, and is only subject to the general principle of proportionality. According to Article 9(3) courts shall have the authority to require the applicant to provide ‘any 12.135 reasonably available evidence in order to satisfy themselves with a sufficient degree of certainty that the applicant is the rightholder and that the applicant’s right is being infringed, or that such infringement is imminent’. This wording makes clear that what is expected from the right holder is what is considered as being reasonably available evidence in the circumstances on the basis of which it can be presumed that his rights are infringed or are about to be infringed. This evidentiary standard is considerably lower compared to that required for the proceedings on the merits. If no ‘sufficient degree of certainty’ can be achieved the right holder may combine this measure with a request to order the production or seizure of evidence.128 No time limits are provided for the submission of requests for the ordering of preliminary measures. 12.136 There is no requirement that the urgency of the matter forms a prerequisite and that the provisional measure is ordered to satisfy immediate judicial action.129 Member States must ensure that provisional measures should also be available without the other 12.137 party having been heard (ex parte proceedings). This is dictated by the nature of IP infringements according to which if the other party is notified he may easily make all necessary evidence disappear.

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126 127 128 129

Case C-324/09 L’Oréal v eBay ECLI:EU:C:2011:474, para. 131; Case C-70/10, Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) ECLI:EU:C:2011:771, para. 31; Case C-360/10 Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV ECLI:EU:C:2012:85, para. 29. Guidance, 20–21. Regarding recurring penalty payments, see further the discussion under Art. 11, paras 12.174–12.175 below. Walter and Goebel, 1281. Ibid., 1282, fn 346.

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The Directive does not specify the circumstances under which ex parte proceedings may be allowed. It however provides that they can only take place ‘in appropriate cases’ (i.e. the measure needs to be proportionate, meaning that the particular circumstances of the case need to be taken into account) and ‘in particular where any delay would cause irreparable harm to the rightholder’. The ‘delay’ referred to in Article 9(4) is presumably that connected to proceedings on the merits. From the wording ‘in particular’ can be deduced that ‘irreparable harm’ does not form a necessary prerequisite for ex parte proceedings.130 Regarding the relevance of protective briefs in relation to the possibility of issuing ex parte measures set out in Article 9, see further the discussion under Article 7(1) at paragraph 12.95. 12.138 In this case the parties that have not been heard have the right to be informed without delay after the execution of the measures at the latest. In addition these parties have the right to ask for the review of the judgment (in an inter partes proceeding) requesting the measure to be modified or revoked. 12.139 Since provisional measures are ordered on the basis of a lower evidentiary level compared to that applying to cases heard on the merits Article 9(6) provides that the courts may make the ordering of such measures subject to the lodging by the applicant of adequate security or an equivalent assurance intended to ensure compensation for any prejudice suffered by the defendant. Although this Article provides for such a security it does not, however, render it a necessary prerequisite for the ordering of such measures by the courts. Also it does not specify the conditions under which it may be ordered as for example, the insecure financial state of the defendant, the weak case at issue, the severity of the alleged infringement and so on. See further the discussion under Article 7(2) at paragraph 12.99. 12.140 In case the provisional measures are revoked or lapse due to any act or omission by the applicant, or where it is subsequently found that there has been no infringement or threat of infringement of an IP right – and irrespective of whether a security or equivalent assurance has been lodged – the courts should have the authority to order the applicant, upon request of the defendant, to provide the defendant with appropriate compensation for any injury caused by those measures (Art. 9(7)). Those compensation measures constitute guarantees which the legislature deemed necessary as a counterweight to the prompt and effective provisional measures for which it made provision (Recital 22).131 The applicant’s liability is unlimited in the sense that compensation is not made subject to a particular damage but rather relates to any damage suffered by the defendant including lost profits, subsequent damage and immaterial prejudice. The court is free to calculate the compensation as it sees fit. However, such compensation must be ‘appropriate’, i.e. it must be justified in the light of the specific circumstances of the case before the national court. The appropriate compensation laid down in Article 9(7) is a guarantee that the EU legislature considered it necessary to cover the costs and injury to which the defendant is subject following an ‘unjustified application’ for provisional measures. It follows from Recital 22 of the Directive that a finding that such an application is unjustified presupposes, primarily, that there is no risk that irreparable harm may be caused to the holder of an IP right in the event of delay in the adoption of the measures sought by him or her.132 Repeal or lapse of provisional measures, or the subsequent finding that there is no infringement of an IP right, are necessary preconditions for a compensatory

130

131 132

See F.G. Wilman ‘A decade of private enforcement of intellectual property rights under IPR Enforcement Directive 2004/48: where do we stand (and where might we go)?’ (2017) E.L. Rev., 42(4), 509 (520) who notes, however, that in situations where there is no demonstrable risk of irreparable harm, it may nevertheless be difficult to establish that the requested measure is proportionate in the sense of Art. 3 of the Directive. Case C-681/13 Diageo Brand BV v Simiramida-04 EOOD ECLI:EU:C:2015:471, para. 74. Case C-688/17 Bayer Pharma AG v Richter Gedeon Vegyészeti Gyár Nyrt. and Others, ECLI:EU:C:2019:722, paras. 60–62.

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order as set out in Article 9(7). However, the mere fact that those conditions are fulfilled does not mean that a claim for compensation will automatically and in any event arise. The national court must determine whether the applicant has not abused the provisional measures provided for in Article 9 of the Directive, taking into account all the circumstances of the case at hand, including the conduct of the parties.133 Provisional measures are revoked or otherwise cease to have effect if the applicant does not institute, 12.141 within a reasonable period of time, proceedings leading to a decision on the merits. The period within which the applicant has to initiate proceedings on the merits is determined by the judicial authority ordering the measures. If the law of the Member State does not provide for such a period then Article 9(5) specifies that this period should not exceed 20 working days or 31 calendar days, whichever is the longer. Although the Directive does not provide how this period is calculated it is only logical to assume that it should be calculated from the date the provisional measure has been served upon the applicant. If that were not the case the alternative would be the date of the lodging of the application, which would render this – already short – period unrealistic.

2. Injunctions against ‘intermediaries’ Article 9(1)(a) second sentence provides for the right holders’ possibility to apply for an inter- 12.142 locutory injunction – under the same conditions as those enshrined in the first sentence of sub-paragraph (a) – against an intermediary whose services are being used by a third party to infringe an IP right.134 Although this Article refers to injunctions solely rather than ‘interlocutory injunctions’ the reference is to be understood as covering the latter in conformity with the aim of the provision. Injunctions against intermediaries in relation to copyright and related rights are justified by the fact that it is usually easier and more effective to require one intermediary to take action to prevent an infringement from occurring than it is to take direct action against each individual user uploading pirated copies of protected works or each individual seller of pirated goods. ISPs, in particular, are the best placed in many instances to put an end to or prevent online infringements. The Directive does not specify which economic operators are to be considered as ‘intermediaries’ for 12.143 the purpose of the Directive. However, the notion of ‘intermediaries’ has been construed broadly by the CJEU. An economic operator can qualify as an intermediary within the meaning of Articles 9(1)(a) and 11, third sentence, of the Directive when it provides a service which is capable of being used by one or more other persons in order to infringe one or more IP rights or to access infringing 133

134

Ibid., paras. 51–52. In this case, the CJEU held that the repeal ‘of the provisional measures at issue in the main proceedings’ could not be regarded in itself as a decisive factor in proving that applying for such measures was unjustified (ibid., paras. 60–73). This case concerned launch-at-risk scenarios and allegations of a patent infringement. Although much of the decision is broadly formulated and discusses IP rights in general, and not just patents, the key findings are made in the context of the main proceedings. L. Dijkmans notes that a significant number of EU Member States apply a strict liability regime to enforcement of provisional measures that are later repealed and consider this an important safeguard for defendants in provisional relief proceedings. Thus, if the outcome in the Bayer case indeed extends to all provisional measures in IP cases, that would mean a major departure from well-established legal practice in those Member States: see L. Dijkman, ‘CJEU rules that repeal of provisional measures does not necessarily create liability for wrongful enforcement’ (2019) 14 JIPLP, 12, 917 (918). Injunctions against intermediaries whose services are used by a third party to infringe copyright or related rights were already enshrined in Article 8(3) of Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society (and subsequently in Art. 11 (third sentence) of Directive 2004/48). However, it became clear after the implementation of Directive 2001/29/EC that some Member States interpreted this provision rather restrictively, as to only provide injunctive relief against intermediaries in the context of pending court proceedings or after the decision on the merits of the case, and not as a provisional measure. To remedy this restrictive approach, Art. 9 of the Directive applies to all intellectual property rights as a provisional measure, i.e. irrespective of whether court proceedings on the merits of the same case are pending or not but where, nevertheless, an alleged infringement is concerned. The Article therefore introduced a new element which needed to be reflected through changes in national laws in almost all Member States. Report II, 15.

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contents or goods.135 Consequently, the application of Articles 9(1)(a) and 11 of the Directive is not limited to a specific group of intermediaries but spans different sectors, and includes both online and offline services. The fact that these provisions refer to the use of the services in question ‘by a third party to infringe an intellectual property right’ seems to imply that it need not necessarily be the infringer himself who uses the service. In any case, ‘intermediaries’ in the sense of these Articles must have the ability to stop or prevent the (alleged) infringement.136 12.144 The CJEU has held137 that the concept of ‘intermediaries’ encompasses, next to ISPs,138 economic operators providing services required for the transmission of works or other protected subject matter in a network, including access providers,139 social networking platforms,140 ‘AdWords’ referencing providers,141 online marketplace operators (including online shopping sites),142 undertakings involved in the filling of cans with drinks produced by others,143 a tenant of market halls subletting its sales points144 and warehouse keepers.145 This list is not exhaustive and could also, depending on the circumstances of the facts at issue in the legal proceedings at hand, include for example such economic operators as providers of certain information society services, and those who transport goods suspected of infringing IP rights (such as carriers, freight forwarders, shipping agents and logistics companies, or postal and parcel service providers), retailers, as well as ISPs and internet platforms such as online market places or search engines. 12.145 Although interlocutory injunctions are to be ordered under the same conditions as those applying to alleged infringers, this is not to assume that provisional measures against intermediaries require any liability (i.e. copyright or related rights infringement) on their part. Consequently, the competent judicial authorities cannot require applicants to demonstrate that the intermediary is liable, even indirectly, for an (alleged) infringement, as a condition for an injunction to be granted.146 These measures are independent from any proceedings against the infringer as well as from any intermediaries’ liability. Neither is it required, for Articles 9(1)(a) and 11 to apply, that there is a contractual link between the service provider and the person who infringed the IP right at issue.147 Thus, the threshold for being considered an intermediary in the sense of these provisions is relatively low. 12.146 Article 9(1)(a) (as well as Art. 11) should be interpreted and applied in light of the general requirements of Article 3 and the applicable fundamental rights anchored in the EU’s Charter of

135 136 137 138

139 140 141 142 143 144 145 146 147

Case C-314/12 UPC Telekabel Wien GmbH v Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft mbH, ECLI:EU:C:2014:192. F.G. Wilman, ‘A decade of private enforcement of intellectual property rights under IPR Enforcement Directive 2004/48: where do we stand (and where might we go)?’ (2017) E.L. Rev., 42(4), 509 (521). While some of these decisions relate to trademark infringements, their reasoning may equally be applicable in copyright and related right infringement cases. Case C-557/07 LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH, ECLI:EU:C:2009:107, para. 46; Case C-70/10 Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM), ECLI:EU:C:2011:771, para. 30. C-557/07 LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH, ECLI:EU:C:2009:107. Case C-70/10 Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM), ECLI: EU:C:2011:771, para. 28. Cases C-236/08 to C-238/08 Google France and Google, ECLI:EU:C:2010:159. Case C-324/09 L’Oréal v eBay, ECLI:EU:C:2011:474, para. 131. Case C-119/10 Frisdranken Industrie Winters BV v Red Bull, ECLI:EU:C:2011:837. Case C-494/15 Tommy Hilfiger Licensing LLC and Others v Delta Center a.s., ECLI:EU:C:2016:528, para. 28. Case C-379/14 Top Logistics & Van Caem International v Bacardi ECLI:EU:C:2015:497. Case C-324/09 L’Oréal v eBay, ECLI:EU:C:2011:474, para. 127; Case C-494/15 Tommy Hilfiger Licensing LLC and Others v Delta Center a.s., ECLI:EU:C:2016:528, para. 22. See also Guidance, 16. Case C-314/12 UPC Telekabel Wien GmbH v Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft mbH, ECLI:EU:C:2014:192, paras 34–35.

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Fundamental Rights. In this regard, see further the discussion under Article 11, paragraphs 12.176–12.179 below. For a detailed discussion of the case law regarding the compatibility of injunctions, blocking orders and filtering obligations with fundamental rights, see paragraphs 21.155–21.185. 12.147

Article 9(1)(a) second sentence is considered a ‘TRIPs Plus’ provision.148

3. Seizure of goods The conditions applying to cease and desist orders under Article 9 also apply for the seizure or 12.148 delivery up of goods149 that are suspected of infringing an IP right. More specifically, the seizure may be ordered if infringement is proved with a ‘sufficient degree of certainty’ (para. 3); it may be ordered inaudita altera parte (para. 4) on condition that a procedure on the merits is initiated within the prescribed period (para. 5). Courts have the discretion to order the lodging of an adequate security or equivalent assurance by the applicant (para. 6). In case the measure is revoked or lapses due to any act or omission by the applicant, or where it is subsequently found that there has been no infringement or threat of infringement, the applicant may be held liable and may have to provide the defendant with appropriate compensation (para. 7) for any injury caused by the measures. This seizure (or delivery up) aims at preventing them from entering the market or at taking them out of the channels of commerce (Art. 9(1)(b)). This provision is considered to supplement Regulation 608/2013, which applies to customs actions, by expanding this facility to infringements taking place within the EU borders. The goods should not be destroyed but kept in custody until infringement is definitely proved in the 12.149 course of proceedings on the merits. It logically follows that in order for such a measure to be ordered it needs to be proved that the 12.150 goods are within the ‘channels of commerce’ or that there is imminent threat that they will enter the ‘channels of commerce’. This provision is not meant to apply to end-users unless it can be deduced that the end-users will resell them. Goods can be seized from end-users on the basis of Article 7, if they are needed as evidence. Yet, goods seized under Article 9(1)(b) can additionally be used as evidence substituting to some extent Article 7 of the Directive. In this respect Article 9(1)(b) can be more useful compared to Article 7. The former (Art. 9(1)(b)) provides for (a potential) exhaustive and comprehensive seizure of all products in order to take them out of commerce or prevent them from entering the market; the latter (Art. 7) provides for the seizure of a few samples only (or not even samples if a simple description of them serves the purpose) in order for relevant evidence to be preserved.150 The reason why no confidentiality clause exists here is linked to the fact that the goods at issue either are in the channels of commerce or are due to be released in them. This means that everyone has or is due to have access to them; so confidentiality restraints will usually not apply.

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Injunctions against ISPs in order to block sites offering or facilitating the unauthorised access and downloading of copyright works and related rights subject matter have become very successful throughout the EU. In Greece, see Court of First Instance of Athens (preliminary injunction) Case No. 4658/2012. For cases in other EU countries see the Hellenic Copyright Organization’s Comparative Report on Legislation and Cases Concerning Copyright Infringements on the Internet and the Role of Internet Service Providers (in Greek), www.opi.gr. The delivery up of goods, although considered as a less invasive measure, which allows the possessor to deliver up the goods himself instead of seizing them (and for that reason may also correspond to the principle of proportionality), is in essence used as an alternative for the possessor, whose goods will be seized unless he agrees to deliver them up himself. That in practice means that it is not ordered as a separate measure, but rather included in the same order. See also Art. 10 of the Directive, which even allows the destruction of the infringing goods, which are in third-party hands, in the context of corrective measures.

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4. Precautionary seizure of assets to secure financial claims 12.151 Article 9(2) together with Article 9(1)(a) second sentence introduce ‘TRIPs Plus’ elements. They have been modelled on the British ‘freezing injunction’ (Mareva injunction),151 which is known in other jurisdictions, too. 12.152 In case of infringement committed on a commercial scale, Member States shall ensure that, if the injured party demonstrates circumstances likely to endanger the recovery of damages, the judicial authorities may order the precautionary seizure of the movable and immovable property of the alleged infringer, including the blocking of his bank accounts and other assets. Competent authorities may also order the communication of bank, financial or commercial documents, or appropriate access to the relevant information. 12.153 This provision is obligatory for Member States to introduce. Initially it was a general provision applying to all infringements. However, since it was considered rather invasive during the legislative process,152 it was limited to acts committed on a commercial scale. 12.154 Circumstances which are likely to endanger the recovery of damages are assessed objectively on the basis of the alleged infringer’s financial state, which creates the assumption that the alleged infringer may not be able to compensate the injured party when pecuniary claims are to be enforced. The Article refers to the ‘recovery of damages’ but ‘damages’ are to be construed broadly covering any kind of monetary claims, i.e. direct or indirect damage, immaterial prejudice as well as legal costs (Art. 14) and expenses for the publication of the judicial decision (Art. 15). 12.155 Article 9(2) provides that the injured party needs to demonstrate circumstances likely to endanger the recovery of damages. That means that apart from the risk of not recovering damages the amount of damages should also be demonstrated against which this risk will have to be assessed by the court. The use of the word ‘demonstrate’ is not indicative of the level of evidence required. However, it seems an a contrario argument can be deduced according to which the level of evidence required is rather low. Since precautionary measures are at issue, the level of evidence required in proceedings on the merits cannot be expected. In addition, if the drafters of the Directive aimed at the level of evidence which is required in paragraph 3 in order for the courts to satisfy themselves with a sufficient degree of certainty that the applicant is the right holder and that the applicant’s right is being infringed, or that such infringement is imminent, they would have indicated it by referring expressly to the provision of ‘reasonably available evidence’. Such a requirement is not there because in most cases it will be impossible for the applicant to have access to all information required to establish with a considerable degree of certainty the alleged infringer’s future incapability to pay compensation. 12.156 If the freezing of assets proves unfounded, the measure is revoked (or otherwise ceases to have effect) and the defendant can claim compensation on the basis of Article 9(6). The plaintiff may be required by the court to lodge a security (in the context of the precautionary measure concerning the freezing of assets) in order to ensure the payment of such compensation. Regarding the payment of securities, see the discussion under Article 7(2) at paragraph 12.99. 12.157 The freezing of assets includes both movable and immovable property as well as bank accounts and other assets. The scope of these ‘other assets’ is left to the Member States’ discretion.

151 152

Mareva Compania Naviera SA v International Bulkcarriers SA [1975] 2 Lloyd’s Rep 509. The Economic and Social Committee raised concerns (on the basis of the initial draft) relating to the harm this provision could cause to wrongly accused defendants and COREPER limited its application to acts committed on a commercial scale.

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The communication of bank, financial or commercial documents, or appropriate access to the 12.158 relevant information may be ordered in the context of a precautionary measure in order for the recovery of damages to be secured. Such information may be crucial for the injured party to demonstrate circumstances likely to endanger the recovery of damages. That means that the applicant has first, to investigate the alleged infringer’s financial state in order to assess whether such a precautionary measure is required and second, to specify the assets that should be subject to such a precautionary measure. Although this provision does not indicate whether it is the alleged infringer that is to provide such 12.159 information or a third party, too (e.g. a bank), an argument that it is rather the alleged infringer himself may be deduced by analogy with Article 6(2). This can also be argued on the basis of proportionality. In any case, this information needs to be treated as confidential by analogy with Article 6 of the Directive as there seems to be no reason to differentiate between the two cases.153

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.6.2001. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market, OJ L 178/1, 17.07.2000. See also related instruments at Art. 1.

2. CJEU case law Bayer Pharma AG v Richter Gedeon Vegyészeti Gyár Nyrt. and Others (C-688/17), ECLI:EU:C:2019:722. Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV (C-360/10), ECLI: EU:C:2012:85. Diageo Brand BV v Simiramida-04 EOOD (C-681/13), ECLI:EU:C:2015:471. Frisdranken Industrie Winters BV v Red Bull (C-119/10), ECLI:EU:C:2011:837. Google France and Google (C-236/08 to C-238/08), ECLI:EU:C:2010:159. L’Oréal v eBay (C-324/09), ECLI:EU:C:2011:474. LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH (C-557/07), ECLI:EU:C:2009:107. Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) (C-70/10), ECLI: EU:C:2011:771. Tobias Mc Fadden v Sony Music Entertainment Germany GmbH (C-484/14), ECLI:EU:C:2016:689. Tommy Hilfiger Licensing LLC and Others v Delta Center a.s. (C-494/15), ECLI:EU:C:2016:528. Top Logistics & Van Caem International v Bacardi (C-379/14), ECLI:EU:C:2015:497. UPC Telekabel Wien GmbH v Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft mbH (C-314/12), ECLI:EU:C:2014:192.

3. Bibliography Dijkman, L. ‘CJEU rules that repeal of provisional measures does not necessarily create liability for wrongful enforcement’ (2019) 14 JIPLP, 12, 917. Hecht, M. and B. Clark, ‘Landlord liability for IP infringements: CJEU holds that operators of physical marketplaces are intermediaries under the Enforcement Directive in Tommy Hilfiger (C-494/15)’ (2016) 38 EIPR, 11, 703. Husovec, M. ‘Injunctions against third innocent parties: the case of website blocking’ (2013) JIPITEC, 4, 2.

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Walter and Goebel, 1289, fn 369.

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Chapter 12 THE ENFORCEMENT DIRECTIVE Savola, P. ‘The ultimate copyright shopping opportunity – Jurisdiction and choice of law in website blocking injunctions’ (2014) 45 I.I.C., 287. Torremans, P. ‘Jurisdiction for cross-border intellectual property infringement cases in Europe’ (2016) 53 C.M.L.Rev., 1625. See also Bibliography at Art. 1.

SECTION 5 MEASURES RESULTING FROM A DECISION ON THE MERITS OF THE CASE ARTICLE 10: CORRECTIVE MEASURES 1.

2. 3.

Without prejudice to any damages due to the rightholder by reason of the infringement, and without compensation of any sort, Member States shall ensure that the competent judicial authorities may order, at the request of the applicant, that appropriate measures be taken with regard to goods that they have found to be infringing an intellectual property right and, in appropriate cases, with regard to materials and implements principally used in the creation or manufacture of those goods. Such measures shall include: (a) recall from the channels of commerce; (b) definitive removal from the channels of commerce; or (c) destruction. The judicial authorities shall order that those measures be carried out at the expense of the infringer, unless particular reasons are invoked for not doing so. In considering a request for corrective measures, the need for proportionality between the seriousness of the infringement and the remedies ordered as well as the interests of third parties shall be taken into account.

SELECTED RECITALS (24) Depending on the particular case, and if justified by the circumstances, the measures, procedures and remedies to be provided for should include prohibitory measures aimed at preventing further infringements of intellectual property rights. Moreover there should be corrective measures, where appropriate at the expense of the infringer, such as the recall and definitive removal from the channels of commerce, or destruction, of the infringing goods and, in appropriate cases, of the materials and implements principally used in the creation or manufacture of these goods. These corrective measures should take account of the interests of third parties including, in particular, consumers and private parties acting in good faith. (25) Where an infringement is committed unintentionally and without negligence and where the corrective measures or injunctions provided for by this Directive would be disproportionate, Member States should have the option of providing for the possibility, in appropriate cases, of pecuniary compensation being awarded to the injured party as an alternative measure. However, where the commercial use of counterfeit goods or the supply of services would constitute an infringement of law other than intellectual property law or would be likely to harm consumers, such use or supply should remain prohibited.

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ARTICLE 46: OTHER REMEDIES

RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT ARTICLE 46: OTHER REMEDIES In order to create an effective deterrent to infringement, the judicial authorities shall have the authority to order that goods that they have found to be infringing be, without compensation of any sort, disposed of outside the channels of commerce in such a manner as to avoid any harm caused to the right holder, or, unless this would be contrary to existing constitutional requirements, destroyed. The judicial authorities shall also have the authority to order that materials and implements the predominant use of which has been in the creation of the infringing goods be, without compensation of any sort, disposed of outside the channels of commerce in such a manner as to minimize the risks of further infringements. In considering such requests, the need for proportionality between the seriousness of the infringement and the remedies ordered as well as the interests of third parties shall be taken into account. In regard to counterfeit trademark goods, the simple removal of the trademark unlawfully affixed shall not be sufficient, other than in exceptional cases, to permit release of the goods into the channels of commerce.

I. COMMENTARY Article 10 concerns corrective measures and is modelled on Article 46 of the TRIPs Agreement.154 12.160 Yet, it contains ‘TRIPs Plus’ elements. Corrective measures aim at restoring (i.e. ‘correcting’) the infringement by eliminating infringing products from the course of trade. Such measures are obligatory, concern any IP infringement – irrespective of whether it is conducted 12.161 on a commercial scale or not – and are without prejudice to any damages or any other claim by the right holder. Unlike provisions on damages (Art. 13), Article 10 does not expressly require that an infringer knowingly, or with reasonable ground to know, engaged in an infringing activity, for the measure in question to be imposed. Recital 25 specifies, however, that where an infringement is committed unintentionally and without negligence and where the corrective measures or injunctions provided for by the Directive would be disproportionate, Member States should in principle have the option of providing for the possibility, in appropriate cases, of pecuniary compensation being awarded to the injured party as an alternative measure. According to Article 10(1) appropriate measures may be ordered by the courts (a) with regard to 12.162 goods that are found to infringe an IP right and (b) in appropriate cases with regard to materials and implements principally used in the creation or manufacture of those goods. The use of the word ‘appropriate’ indicates that a court has the discretion to decide what is most 12.163 suitable in the circumstances. In any case the court should take into account the principle of proportionality between the seriousness of the infringement and the remedies ordered, whilst the interests of third parties should also be taken into consideration (Art. 10(2)). Corrective measures may be ordered against third parties, too, in relation to infringing goods, materials or implements, possessed or owned by them, irrespective of their liability or even good faith. However, these persons’ rights will be assessed and taken into account and the court may in the circumstances order

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For more information on corrective measures see ‘Corrective measures in intellectual property rights’, Study by the European Observatory on Counterfeiting and Piracy (2010) https://euipo.europa.eu/ohimportal/documents/11370/ 80606/Corrective+measures+in+intellectual+property+rights/79fa3831-cd54-4284-af81-16707be5b091.

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less invasive measures or refrain – in exceptional circumstances – from ordering any corrective measures at all. 12.164 Article 10(1) (a)–(c) provide for examples of corrective measures. In any case, however, such measures should include recall, definitive removal from the channels of commerce as well as destruction. These measures can apply alternatively or concurrently depending on what the court considers appropriate in the circumstances. 12.165 Although corrective measures are primarily concerned with infringing goods (e.g. books, CDs, DVDs, etc.) this provision also makes reference to ‘materials and implements principally used in the creation or manufacture of those goods’. Corrective measures in these instances apply ‘in appropriate cases’ only, which means that they cannot be ordered on the same basis as those measures concerning infringing goods. The courts have discretion to assess what these cases are. A prerequisite though is that the materials and implements concerned should have principally been used in the creation and manufacture of infringing goods. 12.166 Recall of goods from the channels of commerce means their withdrawal from distributors such as wholesalers and retailers. It is not clear though whether this provision also covers consumers/endusers. Once goods have been recalled they can be removed from the channels of commerce in many ways and by whatever means.155 One of them is to destroy them. They can, however, also be modified, recycled or even passed over to the right holder, if national law permits. It is disputed whether they can be used for charitable purposes without the right holder’s consent, especially if such use may prove to be detrimental to the right holder.156 Since the measure needs to be appropriate the courts may decide that a simple modification would do, such as the reprint of a page of a book, change of the names on the book cover, removal of the CD from the publication, and so on. 12.167 These measures should be carried out at the expense of the infringer. Such expense covers all costs, for example, recall and removal costs, storage costs, transportation costs, destruction costs, modification costs, and so on. These costs are borne by the infringer, unless particular reasons are invoked for not doing so. The reference in the provision of ‘particular reasons’ indicates that it can

155

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Most Member States seem to use ‘recall’ as a temporary measure, which may be reversed following a final decision. Thus, recall seems to be used by the majority of the Member States when the goods are no longer in the possession of the defendant. The defendant then is usually ordered by the court to claim the goods back from its customers (wholesalers, distributors, retailers etc.). ‘Definitive removal’ indicates the finality of the ordered measure for most Member States, and in some Member States (e.g. France) an order for definitive removal is often used as a precondition for destruction. In some countries, recall and definitive removal are used without any distinction (e.g. Greece, Spain, and Romania). In Sweden a non-exhaustive list of measures, including those mentioned in the Directive has been introduced with explicit references to other measures, such as alteration or the taking into custody for the remainder of the term of protection. Finally, there seem to be different views as to whether these measures may be ordered by the courts only as a result of the proceedings on the merits of the case or also as a provisional measure. In some Member States (e.g. in Poland, Denmark), recall may be issued as a preliminary measure, before the proceedings on the merits are commenced. In Germany it has been reported by the stakeholders that according to the prevailing case law, claims for recall or definitive removal may only be raised in proceedings on the merits and not in preliminary proceedings. Report II, 19. Walter and Goebel, 1294, fns 392 and 393. [P]ractices in Member States seem to differ considerably. In some Member States it seems that goods are destroyed only if their secondary use is not possible (e.g. Italy). [The so-called secondary use of goods infringing intellectual property rights consists e.g. in the removal of the infringing sign, logo or trademark from the goods, in its recycling or its donation to charity.] In other Member States secondary use appears to be permitted only in exceptional cases, and there are Member States where secondary use of goods infringing intellectual property rights does not seem to be permitted at all (e.g. France, Greece, Slovenia). Report II, 20.

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only work as an exception to the rule (meaning that it can only be used in exceptional circumstances). Also the injured party is not liable for paying any sort of compensation to the infringer with regard to the application of the corrective measures.157 Corrective measures (Art. 10) are part of the sanctions and remedies ordered in the context of 12.168 proceedings on the merits (together with Arts 11, 12 and 13).158 This derives (a) from the wording of the provision, which expressly refers to goods that are ‘found to be infringing an intellectual property right’, (b) from the legislative history of the provision (the initial proposal concerning the inclusion of corrective measures in the course of provisional proceedings was not adopted in the final text), and (c) from the very nature of the measures (e.g. destruction cannot be a precautionary measure since it is not reversible).

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). See also related instruments at Art. 1.

2. Bibliography See Bibliography at Art. 1.

ARTICLE 11: INJUNCTIONS Member States shall ensure that, where a judicial decision is taken finding an infringement of an intellectual property right, the judicial authorities may issue against the infringer an injunction aimed at prohibiting the continuation of the infringement. Where provided for by national law, non-compliance with an injunction shall, where appropriate, be subject to a recurring penalty payment, with a view to ensuring compliance. Member States shall also ensure that rightholders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe an intellectual property right, without prejudice to Article 8(3) of Directive 2001/29/EC.

SELECTED RECITALS (15) This Directive should not affect substantive law on intellectual property, Directive 95/ 46/EC of 24 October 1995 of the European Parliament and of the Council on the protection of individuals with regard to the processing of personal data and on the free movement of such data, Directive 1999/93/EC of the European Parliament and of the Council of 13 December 1999 on a Community framework for electronic signatures and Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the internal market. (16) The provisions of this Directive should be without prejudice to the particular provisions for the enforcement of rights and on exceptions in the domain of copyright and related rights set out 157 158

Austrian Copyright Act (section 82(5)) and German Copyright Act (section 98(3)) provide for such compensation in cases where the infringing goods are taken over by the injured party. Although Art. 13 is part of Chapter 6 entitled ‘Damages and legal costs’.

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in Community instruments and notably those found in Council Directive 91/250/EEC of 14 May 1991 on the legal protection of computer programs or in Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society. (23) Without prejudice to any other measures, procedures and remedies available, rightholders should have the possibility of applying for an injunction against an intermediary whose services are being used by a third party to infringe the rightholder’s industrial property right. The conditions and procedures relating to such injunctions should be left to the national law of the Member States. As far as infringements of copyright and related rights are concerned, a comprehensive level of harmonisation is already provided for in Directive 2001/29/EC. Article 8(3) of Directive 2001/29/EC should therefore not be affected by this Directive. (24) Depending on the particular case, and if justified by the circumstances, the measures, procedures and remedies to be provided for should include prohibitory measures aimed at preventing further infringements of intellectual property rights. Moreover there should be corrective measures, where appropriate at the expense of the infringer, such as the recall and definitive removal from the channels of commerce, or destruction, of the infringing goods and, in appropriate cases, of the materials and implements principally used in the creation or manufacture of these goods. These corrective measures should take account of the interests of third parties including, in particular, consumers and private parties acting in good faith. (25) Where an infringement is committed unintentionally and without negligence and where the corrective measures or injunctions provided for by this Directive would be disproportionate, Member States should have the option of providing for the possibility, in appropriate cases, of pecuniary compensation being awarded to the injured party as an alternative measure. However, where the commercial use of counterfeit goods or the supply of services would constitute an infringement of law other than intellectual property law or would be likely to harm consumers, such use or supply should remain prohibited.

RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT ARTICLE 44: INJUNCTIONS 1.

2.

The judicial authorities shall have the authority to order a party to desist from an infringement, inter alia to prevent the entry into the channels of commerce in their jurisdiction of imported goods that involve the infringement of an intellectual property right, immediately after customs clearance of such goods. Members are not obliged to accord such authority in respect of protected subject matter acquired or ordered by a person prior to knowing or having reasonable grounds to know that dealing in such subject matter would entail the infringement of an intellectual property right. Notwithstanding the other provisions of this Part and provided that the provisions of Part II specifically addressing use by governments, or by third parties authorized by a government, without the authorization of the right holder are complied with, Members may limit the remedies available against such use to payment of remuneration in accordance with subparagraph (h) of Article 31. In other cases, the remedies under this Part shall apply or, where these remedies are inconsistent with a Member’s law, declaratory judgments and adequate compensation shall be available.

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I. COMMENTARY 1. Introduction Article 11 deals with permanent injunctions following a decision on the merits rather than with 12.169 interlocutory injunctions that are dealt with under Article 9(1)(a). In other words, where a judicial decision confirms the infringement of an IP right, courts may issue a ‘permanent’ injunction against the infringer or an intermediary injunction aimed at prohibiting the continuation of the infringement. Both Articles, however, use more or less the same wording. Article 11 has been drafted on the basis of Article 44(1) of the TRIPs Agreement. Yet, it presents a clear ‘TRIPs Plus’ element in the sense that injunctive relief is provided irrespective of whether the infringer acted by fault or not, in other words without requiring (as the case is with TRIPs) that the infringer knew or had reasonable grounds to know that dealing in such subject matter would entail the infringement of an IP right. Although the injunctions provided under Article 11 aim at the prohibition of the continuation of 12.170 the infringement – in contrast with interlocutory injunctions, which aim at the prevention of an imminent infringement of an IP right or the prohibition of the continuation of an alleged infringement – it is only logical to assume that they can be used as preventive injunctions, too, in cases where infringement is imminent (and not merely hypothetical) if, for example, it has been publicly announced.159 In this case though, a decision on the merits that the act imminent is an infringing act, has to be there. Permanent injunctions referred to in Article 11 can also be issued to prevent further infringements 12.171 of the same nature, where appropriate. For example, intermediaries can also be forced to take measures which contribute to avoiding new infringements of the same kind by the same infringer from taking place.160 Member States are obliged according to Article 11 of the Directive (as well as according to Art. 3) 12.172 to provide for injunctions in their national laws since injunctions play a crucial role regarding the enforcement of IP rights. It is, however, at the courts’ discretion whether to order or not an injunction in a particular case.161 In this regard, see the discussion under Article 9, paragraph 12.131 above. The Directive’s provisions on injunctions (both interlocutory and permanent) are not very clear with 12.173 regard to the scope of injunctions and therefore their scope differs between Member States. In this regard, see the discussion under Article 9, paragraphs 12.132–12.134 above. Special issues arise regarding infringements on the internet, which will be discussed in paragraphs 21.135–21.198 below.

159 160

Walter and Goebel, 1299. Case C-324/09 L’Oréal v eBay, ECLI:EU:C:2011:474, para. 141: The third sentence of Article 11 of Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights must be interpreted as requiring the Member States to ensure that the national courts with jurisdiction in relation to the protection of intellectual property rights are able to order the operator of an online marketplace to take measures which contribute, not only to bringing to an end infringements of those rights by users of that marketplace, but also to preventing further infringements of that kind. Those injunctions must be effective, proportionate, and dissuasive and must not create barriers to legitimate trade.

161

See also Case C-494/15 Tommy Hilfiger Licensing LLC and Others v Delta Center a.s., ECLI:EU:C:2016:528, para. 34; M. Husovec, ‘Injunctions against third innocent parties: the case of website blocking’ (2013) JIPITEC, 4, 2. For more on injunctions see ‘Injunctions in Intellectual Property Rights’, Study by the European Observatory on Counterfeiting and Piracy (2010) http://ec.europa.eu/internal_market/iprenforcement/docs/injunctions_en.pdf.

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2. Enforcing an injunction 12.174 Article 11 (as the case is with Art. 9(1)(a), too, concerning interlocutory injunctions) provides for measures of compliance with an injunction. Non-compliance with an injunction is subject to recurring penalty payments where appropriate and where provided for by national law. The requirement of ‘appropriateness’ is a direct reference to the principle of proportionality and the particular circumstances of each case, which judicial authorities should take into account when they are to decide whether or not to issue an injunction. The proviso concerning national law is of a procedural rather than of a substantive nature. In some jurisdictions recurring penalties or fines are ordered in the context of a decision on the merits rather than in a separate procedure. In some jurisdictions separate enforcement proceedings are required. In any case the legal systems of Member States should ensure that appropriate means are in place concerning compliance with injunctions. 12.175 Recurring penalty payments – as the term suggests – aim at the penalisation of those not complying with the injunction. Such payments may be made to the treasury or the beneficiary depending on the jurisdiction.162 In this latter case (payment to the beneficiary) they may be considered part of the damages due or an additional penalty. In any case they need to ensure compliance with the injunction.

3. Injunctions against intermediaries 12.176 Injunctions may also be applied by right holders against intermediaries whose services are used by a third party to infringe an IP right irrespective of their liability in conformity with what was written under Article 9 (see para. 12.145 above). Regarding the definition of the notion of ‘intermediaries’, see paras. 12.142 to 12.145 above. The wording of Article 11 follows the wording of Article 8(3) of Directive 2001/29/EC on the information society in a manner such as to show that the two Directives are compatible with each other as well as with other Directives, which may be relevant in the field and notably Directive 2000/31 on e-commerce (see Recital 15). However, the Enforcement Directive extends the scope of the injunction so as to cover all IP rights and not only copyright and related rights. 12.177 Intermediaries cannot be required to take measures that would go further than what is strictly necessary to achieve the result sought.163 On the other hand, there is nothing in either the Directive or the Charter of Fundamental Rights which makes the issuance of injunctions against intermediaries contingent on the requirement that it is impossible to address the infringer directly. It is up to the Member States’ courts to determine the actual ‘equitable and proportionate’ measures the intermediaries concerned have to take to put an end to the infringements and prevent further ones. It may be appropriate in this respect to consider whether or not certain alternative measures are conceivable.164 Whereas a written warning may be sufficient in minor cases, service providers may also, depending on the cases, be obliged to terminate their contractual relationship with their customer to effectively prevent the occurrence of further infringements.165 12.178 It follows from the foregoing that, on the one hand, the involvement of intermediaries, which did not themselves engage in any infringing activity, in the process of IP right enforcement under the

162 163 164 165

In the Netherlands fines are paid to the plaintiff. In Germany, Slovak Republic and the UK fines are paid to the court while in some other countries criminal sanctions apply for non-compliance with an injunction. Report II, 13. Art. 52(1) of the EU’s Charter of Fundamental Rights. Case C-484/14 Tobias Mc Fadden v Sony Music Entertainment Germany GmbH, ECLI:EU:C:2016:689, paras. 97–98. M. Hecht and B. Clark, ‘Landlord liability for IP infringements: CJEU holds that operators of physical marketplaces are intermediaries under the Enforcement Directive in Tommy Hilfiger (C-494/15)’ (2016) 38 EIPR, 11, 703 (706).

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Directive can be required to ensure that right holders are in a position to effectively enforce their rights. On the other hand, any injunction may be pronounced only if it ensures a fair balance between the protection of intellectual property and legitimate trade. There may be, depending on the case, no justification for such involvement where the services provided are so distant or immaterial to the (alleged) infringement (e.g. electricity, water or gas provider) that the economic operator in question cannot reasonably be expected to significantly contribute to such effective enforcement, meaning that its involvement would be disproportionate and unnecessarily burdensome.166 The measures adopted by the intermediary to whom the injunction is addressed must be strictly 12.179 targeted and capable of being effective; they must serve to bring an end to the infringement, without however unnecessarily affecting internet users who are using the intermediary’s services to lawfully access information.167 However, it is not necessary that the measures required by the injunction lead to a complete cessation of the infringement; depending on the cases it can be sufficient that they make the infringing acts difficult or seriously discourage them.168 In case of an infringement consisting of a certain content online, it may be appropriate for an injunction addressed to a service provider to require this provider to take down or disable access to that content. Intermediaries cannot be required to make ‘unbearable sacrifices’.169 Accordingly, requiring that access to the entire website is blocked is likely to be too far-reaching, although there can be circumstances, depending on the specifics of the case at hand, where the judicial authority deems this necessary and proportionate (e.g. in cases of large-scale infringements or infringements occurring in a structural manner).170 For a detailed discussion of the case law regarding the compatibility of injunctions, blocking orders and filtering obligations with fundamental rights, see paragraphs 21.155–21.185. The competent judicial authority may decide not to explicitly describe the specific measures which 12.180 the intermediary must take to accomplish the result sought. In such case, however, the measures must not go beyond what is reasonable, be compliant with the principle of legal certainty, respect the fundamental rights of the parties concerned including the internet users’ freedom of information, strict targeting of the measures and a possibility for the judicial authorities to verify that these conditions have been complied with, notably through a possibility for the internet users concerned to assert their rights once the measures are known.171 The Enforcement Directive (as stated in Art. 2(2) and 2(3)(a) and Recitals 15 and 16) leaves intact 12.181 both Directive 2000/31 on e-commerce as well as Directive 2001/29 on the information society. The reference to Directive 2001/29 includes the DSM Directive amending it, and in particular Article 17 thereof. According to Article 15(1) of Directive 2000/31, Member States are prohibited from imposing a general monitoring obligation on online intermediaries in the sense of Articles 14–15 of that Directive.172 Neither can providers of offline services be required to exercise general and permanent oversight over their customers, as such an obligation would be incompatible with the 166 167 168 169 170 171 172

Guidance, 17, which refers, by analogy, to Recital 59 of Directive 2001/29. Case C-314/12 UPC Telekabel Wien GmbH v Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft mbH, ECLI:EU:C:2014:192, para. 56. Ibid., paras. 56 and 58–63; Case C-484/14 Tobias Mc Fadden v Sony Music Entertainment Germany GmbH, ECLI: EU:C:2016:689, paras. 93–95. Case C-314/12 UPC Telekabel Wien GmbH v Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft mbH, ECLI:EU:C:2014:192, para. 53. Guidance, 18–19. Case C-314/12 UPC Telekabel Wien GmbH v Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft mbH, ECLI:EU:C:2014:192, paras. 52–57. The fact that there is no express reference to Arts 12–15 of Directive 2000/31 on e-commerce – as was the EU Parliament’s suggestion during the legislative process – is due to the fact that the ISPs’ limitation of liability is not relevant to the granting of injunctions (interlocutory or permanent) but rather to damages. Regarding Arts 12–15 of Directive 2000/31, see Chapter 21, paragraphs 21.139–21.151.

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requirements of fairness, proportionality and any measures not being excessively costly set out in Article 3 of the Enforcement Directive.173 It would not be compatible with those provisions to require an ISP or a hosting service provider to install, as a preventive measure, a system for filtering all electronic communications passing via its services (in particular those involving the use of peer-to-peer software) or stored on its servers, which applies indiscriminately to its customers, exclusively at its expense and for an unlimited period, which is capable of identifying on the provider’s network the movement of electronic files containing works in respect of which the applicant claims to hold IP rights, with a view to blocking the transfer of copyright-infringing files.174 12.182 On the other hand, some due diligence obligations may be imposed on online service providers with a view to preventing the upload of IP-infringing content identified by right holders and in cooperation with them. Indeed, it follows from Recitals 47 and 48 of Directive 2000/31 that Article 15(1) of that Directive only concerns monitoring obligations of a general nature and does not automatically cover monitoring obligations in a specific case, and that the Directive does not affect the possibility for Member States to require the service providers concerned to apply reasonable duties of care in order to detect and prevent certain types of illegal activities. 12.183 For a detailed discussion of the case law regarding the compatibility of injunctions, blocking orders and filtering obligations with fundamental rights, see paragraphs 15.155–15.185.

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). Council Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 167/10, 22.6.2001. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market, OJ L 178/1, 17.07.2000. See also related instruments at Art. 1.

2. CJEU case law Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV (C-360/10), ECLI:EU: C:2012:85. Diageo Brand BV v Simiramida-04 EOOD (C-681/13), ECLI:EU:C:2015:471. Frisdranken Industrie Winters BV v Red Bull (C-119/10), ECLI:EU:C:2011:837. Google France and Google (C-236/08 to C-238/08), ECLI:EU:C:2010:159. L’Oréal v eBay (C-324/09), ECLI:EU:C:2011:474. LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v Tele2 Telecommunication GmbH (C-557/07), ECLI:EU:C:2009:107. Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) (C-70/10), ECLI:EU: C:2011:771. Tobias Mc Fadden v Sony Music Entertainment Germany GmbH (C-484/14), ECLI:EU:C:2016:689. Tommy Hilfiger Licensing LLC and Others v Delta Center a.s. (C-494/15), ECLI:EU:C:2016:528. Top Logistics & Van Caem International v Bacardi (C-379/14), ECLI:EU:C:2015:497.

173 174

Case C-324/09 L’Oréal v eBay, ECLI:EU:C:2011:474, paras. 138–143; Case C-494/15 Tommy Hilfiger Licensing LLC and Others v Delta Center a.s., ECLI:EU:C:2016:528, paras. 34–35. Case C-324/09, L’Oréal SA and Others v eBay International AG and Others, ECLI:EU:C:2011:474; Case C-70/10 Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM), ECLI:EU:C:2011:771; Case C-360/10 Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV, ECLI:EU:C:2012:85.

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ARTICLE 12: ALTERNATIVE MEASURES UPC Telekabel Wien GmbH v Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft mbH (C-314/12), ECLI:EU:C:2014:192. See also CJEU case law at Art. 1.

3. Bibliography Dijkman, L. ‘CJEU rules that repeal of provisional measures does not necessarily create liability for wrongful enforcement’ (2019) 14 JIPLP, 12, 917. Hecht, M. and B. Clark, ‘Landlord liability for IP infringements: CJEU holds that operators of physical marketplaces are intermediaries under the Enforcement Directive in Tommy Hilfiger (C-494/15)’ (2016) 38 EIPR, 11, 703. Husovec, M., ‘Injunctions against third innocent parties: the case of website blocking’ (2013) JIPITEC, 4, 2. Savola, P. ‘The ultimate copyright shopping opportunity – Jurisdiction and choice of law in website blocking injunctions’ (2014) 45 I.I.C., 287. Stamatoudi, I. ‘The Role of Internet Service Providers. Ethics, Reality and the Law: The Example of Promusicae v. Telefonica ’, in Botti, M. (ed.) 8th International Conference, Computer Ethics: Philosophical Enquiry, Ionio University, Corfu, 26–28 June, Nomiki Vivliothiki, Athens, 2009, 750. Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Information Law Series (B. Hugenholtz (general editor), Wolters Kluwer Law & Business, Alphen aan den Rijn, 2010. Stamatoudi, I. ‘Data Protection, Secrecy of Communications and Copyright Protection. Conflicts and Convergences. The Example of Promusicae v. Telefonica’ in Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Information Law Series (B. Hugenholtz (general editor)), Kluwer Law International, Alphen aan den Rijn, 2010, 199. Stamatoudi, I. ‘ACTA, internet service providers and the acquis communautaire ’ in Rosén, J. (ed.), Intellectual Property at the Crossroads of Trade, ATRIP Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2012, 237. Stamatoudi, I. ‘Towards an updated EU enforcement Directive? Selected topics and problems’, 4th International Seminar on Information Law 2011, Aristotle University of Thessaloniki, University of Macedonia and Ionio University, Thessaloniki 19–22 May, Nomiki Vivliothiki, e-book. Stamatoudi, I. ‘Copyright enforcement and the role of internet service providers’ in Torremans, P. (ed.), The EU Enforcement Directive, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2014, 789. Torremans, P. ‘Jurisdiction for cross-border intellectual property infringement cases in Europe’ (2016) 53 C.M.L.Rev., 1625. See also Bibliography at Art. 1.

ARTICLE 12: ALTERNATIVE MEASURES Member States may provide that, in appropriate cases and at the request of the person liable to be subject to the measures provided for in this section, the competent judicial authorities may order pecuniary compensation to be paid to the injured party instead of applying the measures provided for in this section if that person acted unintentionally and without negligence, if execution of the measures in question would cause him/her disproportionate harm and if pecuniary compensation to the injured party appears reasonably satisfactory.

SELECTED RECITAL (25) Where an infringement is committed unintentionally and without negligence and where the corrective measures or injunctions provided for by this Directive would be disproportionate, Member States should have the option of providing for the possibility, in appropriate cases, of pecuniary compensation being awarded to the injured party as an alternative measure. However, where the commercial use of counterfeit goods or the supply of services would constitute an infringement of law other than intellectual property law or would be likely to harm consumers, such use or supply should remain prohibited.

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RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT ARTICLE 44(2): INJUNCTIONS 2.

Notwithstanding the other provisions of this Part and provided that the provisions of Part II specifically addressing use by governments, or by third parties authorized by a government, without the authorization of the right holder are complied with, Members may limit the remedies available against such use to payment of remuneration in accordance with subparagraph (h) of Article 31. In other cases, the remedies under this Part shall apply or, where these remedies are inconsistent with a Member’s law, declaratory judgments and adequate compensation shall be available.

I. COMMENTARY 12.184 Instead of corrective measures (Art. 10) and injunctions (Art. 11) Article 12 provides for alternative measures to be ordered by the courts in appropriate cases only and where such measures are requested by the infringer. Such alternative measures consist in pecuniary compensation to be paid to the injured party and may be ordered only if that person acted unintentionally and without negligence, if execution of the measures under Articles 10 or 11 would cause him/her disproportionate harm and if pecuniary compensation to the injured party appears reasonably satisfactory. Article 12 has been drafted on the basis of the German Copyright Act175 and is consistent with Article 44(2) of the TRIPs Agreement. 12.185 Pecuniary compensation is not the rule but rather the exception. Therefore, it is indicated in Article 12 that it should be ordered in appropriate cases only. The requirements that follow (three in number) apply cumulatively176 and define what these appropriate cases are. The mere facts that the infringer has not acted negligently or that pecuniary compensation would be reasonably appropriate should not, by themselves, be an adequate basis for allowing the infringer to continue the infringement. The alternative measures laid down in Article 12 may only be granted provided that the measures set out in Articles 10 and 11 would cause the infringer disproportionate harm, he or she has neither acted intentionally nor negligently, and a reasonable compensation is sufficient. It is up to the court to decide whether these requirements are met in a case at issue and even when they are met whether or not to order the alternative measures. 12.186 The first requirement is that the infringer has not acted by fault. It is interesting to note that the fact that Article 12 depends on the infringer’s fault demonstrates that Articles 10 and 11 apply irrespective of any infringer’s fault. 12.187 The second requirement is whether the execution of corrective measures or injunctions would cause the infringer disproportionate harm with regard to the act he or she has committed. In other words,

175 176

German Copyright Act, s. 100. P. Blok notes that, while the English version of Art. 12 is not entirely clear in this regard, on the basis of the German language a cumulative interpretation seems more likely. He further observes that a cumulative interpretation is in line with the idea that, according to the CJEU’s case law, preventing others from exploiting one’s IP right constitutes ‘the very subject matter’ of exclusive rights, and that the exercise of these rights by the owner can be considered abusive conduct only in exceptional circumstances. Moreover, a non-cumulative interpretation would be capable of depriving IP right holders of the right to have recourse to legal proceedings to ensure effective enforcement of his or her exclusive rights.

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there is a test of proportionality between the infringing act and the impact of the corrective measures or injunctions on the infringer. Although this requirement seems to be in line with the proportionality principle provided under Article 10(3) in relation to corrective measures (i.e. the need for proportionality between the seriousness of the infringement and the remedies ordered), Article 12 goes even further in the sense that corrective measures are not ordered in case the remaining two requirements (under Art. 12) are also not met. The third requirement depends on whether pecuniary compensation is reasonably satisfactory to the 12.188 right holder. That means that both the legitimate interests of the infringer as well as those of the right holder are taken into account. It goes without saying though that the interests of the infringer will only be taken into account once all three requirements are met. Recital 25 provides that where the commercial use of counterfeit goods or the supply of services 12.189 would (also) constitute an infringement of law other than IP law or would be likely to harm consumers, such use or supply should remain prohibited. That means that even if all requirements are met for the ordering of alternative measures (whose ordering though still remains at the judicial authority’s discretion) but corrective measures are dictated by other laws that have been infringed in the case at issue, such as, for example, laws for the protection of consumers or the right of personality or public order and morality and so on, but not intellectual property laws, then alternative measures do not apply. Alternative measures apply only with regard to intellectual property infringements. ‘Pecuniary compensation’ is not defined. However, customary royalties that the infringer would 12.190 have to pay for the legitimate use of the subject matter should be taken into account together with the losses incurred by the right holder. This kind of compensation does not have a punitive character since it relates to a ‘good faith’ infringer. Alternative measures – as expressly provided for in Article 12 – apply only with regard to measures 12.191 resulting from a decision on the merits of the case (section 5 of the Directive) and not with regard to provisional measures.177

NOTES 1. Bibliography Blok, P. ‘A harmonized approach to prohibitory injunctions: reconsidering Article 12 of the Enforcement Directive’ (2016) 1 JIPLP, 11, 56. See Notes at Art. 1.

SECTION 6 DAMAGES AND LEGAL COSTS ARTICLE 13: DAMAGES 1.

177

Member States shall ensure that the competent judicial authorities, on application of the injured party, order the infringer who knowingly, or with reasonable grounds to know, engaged in an infringing activity, to pay the rightholder damages appropriate to the actual prejudice suffered by him/her as a result of the infringement. When the judicial authorities set the damages: Many EU Member States have opted for the non-transposition of the alternative measures provided in Art. 12 (e.g. Austria, Belgium, France, Luxembourg, the Netherlands and Slovenia). Report II, 6.

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2.

(a) they shall take into account all appropriate aspects, such as the negative economic consequences, including lost profits, which the injured party has suffered, any unfair profits made by the infringer and, in appropriate cases, elements other than economic factors, such as the moral prejudice caused to the rightholder by the infringement; or (b) as an alternative to (a), they may, in appropriate cases, set the damages as a lump sum on the basis of elements such as at least the amount of royalties or fees which would have been due if the infringer had requested authorisation to use the intellectual property right in question. Where the infringer did not knowingly, or with reasonable grounds to know, engage in infringing activity, Member States may lay down that the judicial authorities may order the recovery of profits or the payment of damages, which may be pre-established.

SELECTED RECITAL (26) With a view to compensating for the prejudice suffered as a result of an infringement committed by an infringer who engaged in an activity in the knowledge, or with reasonable grounds for knowing, that it would give rise to such an infringement, the amount of damages awarded to the rightholder should take account of all appropriate aspects, such as loss of earnings incurred by the rightholder, or unfair profits made by the infringer and, where appropriate, any moral prejudice caused to the rightholder. As an alternative, for example where it would be difficult to determine the amount of the actual prejudice suffered, the amount of the damages might be derived from elements such as the royalties or fees which would have been due if the infringer had requested authorisation to use the intellectual property right in question. The aim is not to introduce an obligation to provide for punitive damages but to allow for compensation based on an objective criterion while taking account of the expenses incurred by the rightholder, such as the costs of identification and research.

RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT ARTICLE 45: DAMAGES 1.

2.

The judicial authorities shall have the authority to order the infringer to pay the right holder damages adequate to compensate for the injury the right holder has suffered because of an infringement of that person’s intellectual property right by an infringer who knowingly, or with reasonable grounds to know, engaged in infringing activity. […] In appropriate cases, Members may authorize the judicial authorities to order recovery of profits and/or payment of pre-established damages even where the infringer did not knowingly, or with reasonable grounds to know, engage in infringing activity.

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ARTICLE 45: DAMAGES

I. COMMENTARY 1. Introduction Article 13 deals with damages.178 It supplements Article 45 of the TRIPs Agreement. It contains 12.192 two paragraphs. The first one deals with damages in cases of culpable infringement and the second with cases of ‘good faith’ infringement.179 It also refers to IP infringements in general without distinguishing between types of IP or types of rights. In this sense, in the field of copyright and related rights damages apply irrespective of whether it is the reproduction right, the distribution right or the right of the communication to the public that is infringed. Although damages are obligatory for cases of culpable infringement this is not the case for 12.193 infringements without fault. In this last instance it is up to the Member States to provide that the courts may order such damages and it is up to the courts’ discretion to award such damages along the lines enshrined in Article 13(2). Yet, since the Directive aims at minimum harmonisation, if Member States wish they may make – even in this case – damages obligatory. Article 13 only deals with claims for damages directed against infringers. It is left to the Member 12.194 States to address the issue whether and under what conditions such claims can be raised against intermediaries or other third parties who have not committed an act qualifying as an infringement.180 Assessing damages for intellectual property right infringement is often complicated. The unpredict- 12.195 ability of damages awards and the low probability of obtaining adequate compensation for the prejudice suffered are among the main reasons given to explain why right holders do not seek civil redress in cases of IP right infringement; most cases end at the stage of granting an injunction and do not reach the stage of requesting damages.181

2. Article 13(1) According to paragraph (1) damages are ordered by the courts on application of the right holder 12.196 against an infringer who acted by fault. The infringer acts by fault when he knowingly, or with reasonable grounds to know, engaged in the infringing activity.182 It seems likely that compliance with the latter requirement is to be assessed by comparing the conduct of the alleged infringer with that of a reasonably circumspect and diligent party in the circumstances of the case at hand.183 It is

178 179 180

See ‘Damages in Intellectual Property Rights’ Study by the European Observatory on Counterfeiting and Piracy (2010) http://ec.europa.eu/internal_market/iprenforcement/docs/damages_en.pdf. Case C-280/15 Irina Nikolajeva v Multi Protect OÜ, ECLI:EU:C:2016:467, para. 51. See, e.g., Recital 24 of the Product Piracy Regulation 608/2013, which states that right holders should be entitled to seek compensation for the costs of customs enforcement of IP rights from the infringer or other persons that might be considered liable under the legislation of the Member State where the goods were found. Such persons might include intermediaries, where applicable. Costs and damages incurred by persons other than customs authorities as a result of a customs action, where the release of goods is suspended or the goods are detained on the basis of a claim of a third party based on intellectual property, should be governed by the specific legislation applicable in each particular case.

181

182 183

Report II, 21–22. European Commission, ‘Synthesis of the Responses: Civil Enforcement of Intellectual Property Rights: Public Consultation on the Efficiency of Proceedings and Accessibility of Measures’, July 2013, https://web. archive.org/web/20140414043501/http://ec.europa.eu/internal_market/consultations/docs/2012/intellectual-propertyrights/summary-of-responses_en.pdf. Guidance, 3. Case C-367/15 Stowarzyszenie “Oławska Telewizja Kablowa” w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie, ECLI:EU:C:2017:36, para. 33. F.G. Wilman, 524.

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clear that if the infringer acted on purpose he acted by fault. However, it is not entirely clear whether negligence is fully covered, or it is only gross negligence which is covered. The wording ‘reasonable ground’ seems to make no distinction between slight and gross negligence. This may also be derived from Article 12 (which is a parallel provision and operates in the same spirit), that makes reference to persons acting ‘unintentionally and without negligence’ as well as from the general spirit of the Directive, which either refers to ‘good faith’ conduct and ‘intentional’ conduct (see, e.g., Recitals 14 and 24). In this sense slight negligence would fall foul of both cases and it would be difficult to classify it as the one sort or the other sort of conduct. 12.197 The notion of ‘damages’ refers to pecuniary damages and should be based on the actual prejudice suffered by the right holder as a result of the infringement. The Directive’s aim is to compensate that prejudice in full.184 Although not stated expressly, this appears to imply that interest on the amounts due must also be paid.185 The prejudice must have occurred ‘as a result of the infringement’, which implies that a causal link needs to be established. While the holder of the infringed right must in principle establish a causal link between the event giving rise to the infringement and the loss suffered, under Article 13(1)(b) he or she is not required to establish a causal link between that event and the precise amount of the loss. Such an interpretation would indeed be irreconcilable with the very idea of setting damages as a lump sum and, therefore, with Article 13(1)(b) which permits that type of compensation.186

A. Article 13(1)(a) 12.198 Sub-paragraphs 1(a) and (b) define to a certain extent the scope of damages and work as an alternative to each other. Member States must ensure that both methods for setting the damages established in the provision are reflected in their national legislation. It is for the applicant, and ultimately the competent judicial authorities, to decide which of these two alternative methods is to be applied in order to set the damages in a given case, provided, however, that the lump sum method referred to in sub-paragraph 1(b) can only be applied ‘in appropriate cases’.187 In the first case (sub-para. 1(a)) courts should take into account all appropriate aspects, meaning all circumstances pertaining to the case at issue. Indicative examples of such circumstances are provided: the negative economic consequences of the infringing act on the right holder, including lost profits, which the injured party has suffered, any unfair profits made by the infringer and, in appropriate cases, elements other than economic factors, such as the moral prejudice caused to the right holder by the infringement (e.g. injury to the right holder’s reputation, emotional distress or other suffering caused by the infringement, etc.). 12.199 The negative economic consequences as well as the lost profits referred to in sub-paragraph (a) directly relate to the actual damage suffered by the right holder. The notion of ‘profits’ made by the infringer seems to relate to what is commonly known in many jurisdictions as unjust enrichment and agency of necessity; it is rather peculiar that it is referred to in paragraph 1 of Article 13, which relates to culpable infringement. The fact that the profits should be ‘unfair’ does not require any additional element of unfairness. Unfairness relates to the fact that the infringing act committed was not authorised by the right holder. The reference to ‘unfair profits’ may also seem confusing to the extent that Article 13(1) is concerned with compensation for prejudice suffered by the right holder, rather than with the restitution of unjust enrichment of the infringer (which might well be covered

184 185 186 187

Case C-99/15 Christian Liffers v Producciones Mandarina SL en Mediaset España Comunicación SA, ECLI:EU: C:2016:173, para. 25. Case C-367/15 Stowarzyszenie “Oławska Telewizja Kablowa” w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie, ECLI:EU:C:2017:36, para. 30, F.G. Wilman, 524. Case C-367/15 Stowarzyszenie “Oławska Telewizja Kablowa” w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie, ECLI:EU:C:2017:36, para. 32. Guidance, 4.

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by Article 13(2)).188 The other factors mentioned in sub-paragraph 1(a) relate to immaterial/moral prejudice, which should also be compensated and should be distinguished from monetary compensation that is due in cases of moral rights’ infringement. The aspects referred to in sub-paragraph 1(a) are not exhaustive but rather indicative. The fact that 12.200 they are all referred to together in this sub-paragraph does not mean that they should be granted cumulatively. The courts will either grant the injured party’s actual damage or its lost profits, whichever is higher. This is dictated by the spirit of this provision (‘actual prejudice’ suffered by the right holder), which corresponds to having actual prejudice compensated just once (i.e. either as actual damage or as loss of profits) as well as by the Member States’ legal traditions, which apply these legal bases alternatively rather than cumulatively.

B. Article 13(1)(b) Sub-paragraph (b) works as an alternative to sub-paragraph (a). In appropriate cases, the courts may 12.201 set the damages as a lump sum on the basis of objective elements, such as at least the amount of royalties or fees, which would have been due if the infringer had requested authorisation to use the subject matter in question (‘hypothetical royalty/fee’). Unlike sub-paragraph (a), sub-paragraph (b) does not expressly mention the possibility of compensation for moral prejudice when setting the damages in accordance with the lump sum method. However, it is required to take not only the material damage but also the moral prejudice suffered into consideration when setting the lump sum in order to achieve the objective of providing full compensation for the actual prejudice suffered.189 According to Recital 26, ‘appropriate cases’ includes cases where it would be difficult to determine the amount of the actual prejudice suffered by the injured party. In the Commission’s view, Recital 26 is however not exhaustive, which implies that national legislation which precludes the possibility to set damages on the basis of a lump sum in accordance with Article 13(1)(b) unless the use of the method referred to in point (a) is impossible, is not consistent with the Directive.190 Recital 26 also explains why the element to be taken into account is ‘at least’ the amount of fees that would be due to the right holder if his authorisation were requested. The aim of the provision (according to the same Recital) is not to introduce an obligation to provide for punitive damages but rather to allow for compensation based on objective criteria.191 Courts should take into account the expenses incurred by the right holder, such as, for example, the costs of identification and research. Member States (if they wish) can go beyond the minimum requirements set out in the Directive 12.202 (according to the principle of favourability) and provide for punitive damages, too, in the form, for

188

189 190

191

See R. Jacob’s view that ‘damage (e.g. lost profits) suffered by the IPR owner is not the same thing as the amount of money the infringer has made. The current directive rather muddles the two up’ as it has been reported in the Report on Commission/Presidency Conference of 26 April 2012 on the Enforcement of IPRs: the Review of the Directive 2004/48/EC, 3. Case C-99/15 Christian Liffers v Producciones Mandarina SL en Mediaset España Comunicación SA, ECLI:EU: C:2016:173, paras. 15–27. Guidance, 4. In his opinion in Case C-367/15 (Stowarzyszenie “Oławska Telewizja Kablowa” w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie, ECLI:EU:C:2016:900, paras. 36–38), Advocate General Sharpston argued that the lump sum method should rather be construed as an exception that can only be used once the applicant has established that the method set out in sub-paragraph (a) does not suffice, notably because it would be difficult to determine the amount of actual prejudice suffered in a more precise manner. We agree with F.G. Wilkman that the threshold, if any, for using the alternative method set out in Art. 13(1)(b) should not be set too high, otherwise this provision risks being a dead letter and it would, as a result, in some cases be very difficult indeed to obtain full compensation: see F.G. Wilkman, 526. Case C-367/15 Stowarzyszenie “Oławska Telewizja Kablowa” w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie, ECLI:EU:C:2017:36, paras. 28–29.

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example, of double or triple the amount of the customary royalty or fee.192 In this regard, some jurisdictions provide for more than just the royalty or fee that would have been paid if the infringer had acquired a licence. The argument is that if they only provided for the customary royalty (i.e. the royalty corresponding to the market price of the use made and which the right holder would have charged in the circumstances) that would prove beneficial to the infringer who would have to pay the same amount of money irrespective of whether he used the subject matter at issue legally or illegally. This would in essence result in a compulsory licence. In addition the infringer could safely invest with the possibility that he might get away with his infringing act; even if he did not, he would still incur the same cost193 as the one he would have incurred if he had acquired a licence in due course. Awarding damages corresponding to only the single amount of the hypothetical royalty or fee would not provide a sufficiently dissuasive effect and would, as such, be inconsistent with Article 3(2) of the Directive. 12.203 Although setting the damages as a multiple (e.g. double or triple) of the customary royalty may work as punitive damages, this is not always the case. The reference to the hypothetical royalties or fees in sub-paragraph (b) of Article 13(1) is only illustrative (‘such as’) and by no means exhaustive. Accordingly, the final amount of damages due may be higher than only this amount (‘at least’). The CJEU has held that national laws that provide for compensation for unauthorised use of copyright works at a multiple of (in the case at hand, twice) the amount of the hypothetical royalty, are not necessarily inconsistent with Article 13(1)(b) of the Directive. Article 13(1) does not preclude national legislation under which the holder of economic rights of copyright that have been infringed may demand from the person who has infringed that right either compensation for the actual damage that he has suffered, taking into account all the appropriate aspects of the particular case (sub-para. (a)), or, without him having to prove the actual loss, payment of a sum corresponding to a multiple of the appropriate fee which would have been due if permission had been given for the work concerned to be used (sub-para. (b)). Such legislation would not automatically amount to ‘punitive damages’.194 Indeed, where an intellectual property right has been infringed, mere payment of the hypothetical royalty is in principle not capable of guaranteeing compensation in respect of all the loss actually suffered. This is because payment of that royalty would not, in itself, ensure reimbursement of any costs (referred to in Recital 26) that are linked to researching and identifying possible acts of infringement,195 compensation for possible moral prejudice or payment of interest on the sums due.196 The use of the lump sum method inherently means that the damages

192

Ibid., paras. 30–32. Some EU Member States have moved beyond the Directive’s provisions and introduced multiple damages awards (mostly double for infringements committed in bad faith). For example, Austria, Belgium, Czech Republic, Lithuania, Poland, Romania, Slovenia. Report II, 5. Slovenia provides for punitive damages, Report II, 24. Greece has also opted for lump sum payments; Article 65(2) of Law No. 2121/1993 provides that: a person who by intent or negligence infringes copyright or a related right of another person shall indemnify that person for the moral damage caused, and be liable for the payment of damages of not less than twice the legally required or customary payable remuneration for the form of exploitation which the infringing party has effected without license.

193 194 195

196

Plus any legal expenses. Case C-367/15 Stowarzyszenie “Oławska Telewizja Kablowa” w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie, ECLI:EU:C:2017:36, paras. 28–33. Depending on the case, the ‘costs of identification and research’ can fall within the scope of either Art. 13 or Art. 14 of the Directive: see Case C-57/15 United Video Properties Inc. v Telenet NV, ECLI:EU:C:2016:611, paras. 35–36 and para. 12.211 below. Ibid., para. 30. See also Case C-99/15 Christian Liffers v Producciones Mandarina SL en Mediaset España Comunicación SA, ECLI:EU:C:2016:173, para. 18.

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thus set may not be precisely proportional to the loss actually suffered by the injured party. In this regard, the requirement of causality should not be interpreted and applied in an excessively strict manner.197 Therefore, in order to meet the dissuasiveness requirement set out in Article 3(2) and ensure full 12.204 compensation for the prejudice suffered as a result of the infringement, the damages set using the lump sum method are not to be restricted to only the amount of a hypothetical royalty or fee and may, depending on the case, well need to constitute a higher amount. The competent judicial authorities have a margin of discretion when setting the damages through applying this method.198 However, depending on the case, it is possible that, in exceptional cases, payment for a loss calculated on the basis of a multiple of the amount of the hypothetical royalty or fee will exceed the loss actually suffered so clearly and substantially that a claim to that effect could constitute an abuse of rights, prohibited by Article 3(2) of the Directive.199

3. Article 13(2) In cases of non-culpable infringement Member States are not obliged to provide for any damages. 12.205 This is rather unfortunate since it defies the spirit of IP protection according to which IP rights are exclusive rights and therefore can only be used with the consent of the right holder. This consent usually relates to the payment of a fee. If, however, Member States choose to provide for damages in such cases Article 13(2) indicates what they may provide. They may provide for the recovery of profits or the payment of damages, which may be pre-established.

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). See also related instruments at Art. 1.

2. CJEU case law Christian Liffers v Producciones Mandarina SL en Mediaset España Comunicación SA (C-99/15), ECLI:EU:C:2016:173. Irina Nikolajeva v Multi Protect OÜ (C-280/15), ECLI:EU:C:2016:467. Stowarzyszenie “Oławska Telewizja Kablowa” w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie (C-367/15), ECLI:EU:C:2017:36.

3. Bibliography Kogut-Czarkowska, M. and B. Clark, ‘“Copyright and punishment”: CJEU rules that the IP Enforcement Directive does not prevent “lump sum” damages in IP cases’ (2017) 39, EIPR, 5, 315. Schweizer, M. ‘Double licence fees are not punitive damages’ (2017) 12 JIPLP, 7, 546. See also Bibliography at Art. 1.

197 198 199

Case C-367/15 Stowarzyszenie “Oławska Telewizja Kablowa” w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie, ECLI:EU:C:2017:36, paras. 26 and 32. Guidance, 5. Case C-367/15 Stowarzyszenie “Oławska Telewizja Kablowa” w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie, ECLI:EU:C:2017:36, para. 31.

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ARTICLE 14: LEGAL COSTS Member States shall ensure that reasonable and proportionate legal costs and other expenses incurred by the successful party shall, as a general rule, be borne by the unsuccessful party, unless equity does not allow this.

SELECTED RECITALS (17) The measures, procedures and remedies provided for in this Directive should be determined in each case in such a manner as to take due account of the specific characteristics of that case, including the specific features of each intellectual property right and, where appropriate, the intentional or unintentional character of the infringement.

RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT ARTICLE 45(2): DAMAGES 2.

The judicial authorities shall also have the authority to order the infringer to pay the right holder expenses, which may include appropriate attorney’s fees. […]

ARTICLE 48(1): INDEMNIFICATION OF THE DEFENDANT 1.

[…] The judicial authorities shall also have the authority to order the applicant to pay the defendant expenses, which may include appropriate attorney’s fees.

I. COMMENTARY 12.206 Member States should provide in their laws that legal costs and other expenses incurred by the successful party shall be borne by the unsuccessful party. This is provided as a general rule, which applies both to preliminary measures as well as to proceedings on the merits, and which is consistent with the general principle applying in most jurisdictions that the party who loses is the party to bear the legal costs of the case, which the other party incurred in order to be satisfied in law (also known as victus victori). 12.207 Lawyers’ fees and other costs related to litigation, as well as the perception that it is usually difficult to obtain appropriate compensation for such costs, are cited as the main reasons intellectual property right holders do not seek civil redress for alleged IP infringement.200 The Member States’ regimes on reimbursing legal costs vary considerably and do not always allow covering the full costs

200

European Commission, ‘Synthesis of the Responses: Civil Enforcement of Intellectual Property Rights: Public Consultation on the Efficiency of Proceedings and Accessibility of Measures’, July 2013, https://web.archive.org/web/ 20140414043501/http://ec.europa.eu/internal_market/consultations/docs/2012/intellectual-property-rights/summaryof-responses_en.pdf, 7.

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ARTICLE 48(1): INDEMNIFICATION OF THE DEFENDANT

incurred by the successful party. Those differences relate to the types of costs covered by the provisions implementing Article 14, as well as to the level of costs that can be claimed.201 Considering the scope of the Directive (Art. 2(1)), Article 14 only applies to proceedings aiming to 12.208 enforce intellectual property rights. It does not apply in proceedings aimed at the invalidation of such rights.202 Nor does it apply to proceedings entailing an action to pay compensation to copyright holders brought against collecting societies under Article 5(2)(b) of Directive 2001/29 on the information society203 (see para. 12.10 above). By contrast, falling within the scope of the provision, amongst others, are the costs relating to an exequatur procedure brought in a Member State, in the course of which the recognition and enforcement is sought of a judgment given in another Member State in proceedings seeking to enforce an IP right.204 Article 14 also applies to the legal costs incurred by the parties in the context of an action for damages, brought in a Member State, to compensate for the injury caused as a result of a seizure carried out in another Member State, which was intended to prevent an IP right infringement, when, in connection with that action, a question arises concerning the recognition of a judgment given in that other Member State declaring that seizure to be unjustified.205 Article 14 does not provide solely for the recovery of legal costs, but other expenses, too. The 12.209 Directive does not define what the concepts of ‘legal costs and other expenses incurred by the successful party’ entail precisely. The concept of ‘legal costs’ includes, amongst others, lawyers’ fees.206 It may also include certain 12.210 out-of-court expenses, such as fees for the services of the courts. The notion of ‘other expenses’ includes, in principle, costs incurred for the services of a technical 12.211 adviser, amongst others.207 The latter concept is, however, to be interpreted narrowly. Accordingly, only those costs that are directly and closely related to the judicial proceedings concerned qualify as ‘other expenses’ in the sense of Article 14.208 The costs of identification and research prior to the issuance of proceedings, such as those incurred when a technical adviser performs a general observation of the market and detects possible infringements of intellectual property law, attributable to unknown infringers at that stage, do not appear to show such a direct and close link. Hence, they not fall within the scope of Article 14. Like all other expenses not covered by Article 14, those costs are to be dealt with under Article 13 on actions for damages (Recital 26). On the other hand, when the services of a technical adviser, regardless of the nature of such services, are essential in order for a legal action to be usefully brought seeking, in a specific case, to have IP rights upheld, the costs linked to the assistance of that adviser fall within ‘other expenses’ that must, pursuant to Article 14, be borne by the unsuccessful party.209 The courts may also provide – (a) at the request of the applicant, (b) in case the alleged infringer is 12.212 found to be an actual infringer and (c) at the expense of the infringer – for appropriate measures for the dissemination of the information concerning the decision or for any other additional publicity measures, which are considered appropriate to the particular circumstances. These measures include 201 202 203 204 205 206 207 208 209

Guidance, 6–7. Case C-180/11 Bericap Záródástechnikai Bt. v Plastinnova 2000 Kft., ECLI:EU:C:2012:717, paras. 79–81. Case C-435/12 ACI Adam BV and Others v Stichting de Thuiskopie and Stichting Onderhandelingen Thuiskopie vergoeding, ECLI:EU:C:2014:254, para. 63. Case C-406/09 Realchemie Nederland BV v Bayer CropScience AG, ECLI:EU:C:2011:668, paras. 45–50. Case C-681/13 Simiramida-04 EOOD v Diageo Brands BV, ECLI:EU:C:2015:471, paras. 78–79. Case C-57/15 United Video Properties Inc. v Telenet NV, ECLI:EU:C:2016:611, para. 22. Ibid., para. 34. Ibid., paras. 22 and 36. Ibid., para. 39; Case C-367/15 Stowarzyszenie “Oławska Telewizja Kablowa” w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie, ECLI:EU:C:2017:36, para. 30.

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the display of the decision, its publication in full or in part as well as prominent advertising. Depending on the medium of publication the infringer may incur considerable expenses in this respect. This issue is dealt with separately under Article 15. 12.213 Any costs, however, in order to be recovered, should be reasonable and proportionate in conformity with the general principle of proportionality that applies throughout the Directive (Art. 3(2)). Moreover, the procedures aimed at the enforcement of IP rights laid down by the Member States must not be unnecessarily costly (Art. 3(1)). In determining whether legal costs are reasonable, account should be taken of factors such as the subject matter of the proceedings, the sums involved and the work to be carried out by lawyers to represent the successful party.210 While the requirement of proportionality does not imply that the unsuccessful party must necessarily reimburse the entirety of the costs incurred by the other party, it does however mean that the successful party should have the right to reimbursement of, at the very least, a significant and appropriate part of the reasonable costs actually incurred by that party.211 Under Article 14, the infringer must generally bear all the financial consequences of his conduct.212 Reasonable and proportionate are the costs that are deemed necessary and adequate in the case at issue for the party to pursue the measures taken, invoke the sanctions and remedies that apply, and have his claims satisfied in law. Proportionality also applies in relation to the amount claimed in the case at issue. Any legal costs and expenses, in order to be recovered, need to be fully substantiated and proven. 12.214 The general rule that the party that loses bears legal costs and expenses is not unconditional. It only works as a ‘general rule’ to which Member States may provide for exceptions. Thus Member States are free to use their own legal traditions in this respect – for example, provide for the recovery of only some of the legal costs and expenses or for their recovery in relation to certain procedures only (e.g. recovery of costs and expenses in relation to proceedings on the merits but not in relation to provisional measures) and so on. 12.215 Accordingly, although the measures, procedures and remedies set out in the Directive should be determined in each case in such a manner as taking into account the specific characteristics of that case (Recital 17), Article 14 does not preclude national legislation which provides that the unsuccessful party is to be ordered to pay the legal costs incurred by the successful party, which offers the court responsible for making that order the possibility of taking into account features specific to the case before it, and provides for a flat-rate scheme for the reimbursement of costs for the assistance of a lawyer, subject to the condition that those rates ensure that the costs to be borne by the unsuccessful party are reasonable. However, it does preclude national legislation providing flat rates which, owing to the maximum amounts that it contains being too low, do not ensure that, at the very least, a significant and appropriate part of the reasonable costs incurred by the successful party are borne by the unsuccessful party. Any such legislation would not be compatible with the requirement that the measures, procedures and remedies provided for in the Directive must be dissuasive (Art. 3(2)). Neither can the requirement that the unsuccessful party must bear ‘reasonable’ legal costs justify legislation imposing a flat rate significantly below the average rate actually charged for the services of a lawyer in that Member State. The proportionality requirement implies that national legislation that lays down an absolute limit in respect of costs attached to the assistance of a lawyer must ensure that that limit reflects the reality of the rates charged for the services of a lawyer in the field of intellectual property.213

210 211 212 213

Case C-57/15 United Video Properties Inc. v Telenet NV, ECLI:EU:C:2016:611, para. 25. Ibid., para. 29. Case C-406/09 Realchemie Nederland BV v Bayer CropScience AG, ECLI:EU:C:2011:668, para. 49. Case C-57/15 United Video Properties Inc. v Telenet NV, ECLI:EU:C:2016:611, paras. 20-31.

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ARTICLE 15: PUBLICATION OF JUDICIAL DECISIONS

Equity is also a mandatory – under this Article – limitation, which in some cases may not allow the 12.216 recovery of any legal costs and expenses. This limitation may be implemented into national law by reference to particular cases and circumstances or may be left to the courts’ discretion. Abuse of rights or the disproportionate difference between the financial status of the two parties may play a role.214 Article 14 applies irrespective of any fault or negligence on the part of the unsuccessful party.215

12.217

While certain online service providers may benefit from the safe-harbour provisions of Articles 12.218 12–14 of Directive 2000/31, those liability exemptions do not prevent right holders from claiming the reimbursement of the court costs and the costs of giving formal notice and court costs relating to actions for injunctions.216

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). See also related instruments at Art. 1.

2. CJEU case law ACI Adam BV and Others v Stichting de Thuiskopie and Stichting Onderhandelingen Thuiskopie vergoeding (C-435/13), ECLI:EU:C:2014:254. Bericap Záródástechnikai Bt. v Plastinnova 2000 Kft. (C-180/11), ECLI:EU:C:2012:717. Realchemie Nederland BV v Bayer CropScience AG (C-406/09), ECLI:EU:C:2011:668. Simiramida-04 EOOD v Diageo Brands BV (C-681/13), ECLI:EU:C:2015:471. Stowarzyszenie “Oławska Telewizja Kablowa” w Oławie v Stowarzyszenie Filmowców Polskich w Warszawie (C-367/15), ECLI:EU:C:2017:36. United Video Properties Inc. v Telenet NV (C-57/15), ECLI:EU:C:2016:611.

3. Bibliography Slowinski, P.R. ‘Case note on United Video Properties’ (2018) 48 I.I.C., 3, 373. See also Bibliography at Art. 1.

SECTION 7 PUBLICITY MEASURES ARTICLE 15: PUBLICATION OF JUDICIAL DECISIONS Member States shall ensure that, in legal proceedings instituted for infringement of an intellectual property right, the judicial authorities may order, at the request of the applicant and at the expense of the infringer, appropriate measures for the dissemination of the information concerning the decision, including displaying the decision and publishing it in full or in part. Member States may provide for other additional publicity measures, which are appropriate to the particular circumstances, including prominent advertising.

214 215 216

A. Lakits-Josse, 484. Case C-57/15 United Video Properties Inc. v Telenet NV, ECLI:EU:C:2016:611, para. 37. Case C-484/14 Tobias Mc Fadden v Sony Music Entertainment Germany GmbH, ECLI:EU:C:2016:689, para. 78. Regarding Arts 12–14 of Directive 2000/31, see chapter 21, paragraphs 21.139–21.151.

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SELECTED RECITAL (27) To act as a supplementary deterrent to future infringers and to contribute to the awareness of the public at large, it is useful to publicise decisions in intellectual property infringement cases.

I. COMMENTARY 12.219 Member States are under an obligation to provide in their national laws for appropriate publicity measures concerning decisions on IP infringement. However, it is up to the courts to decide whether to order – in particular circumstances – such measures or not. This obligation relates solely to decisions resulting from proceedings on the merits (where the decision is not provisional and therefore subject to proceedings on the merits). Such measures are taken only at the request of the applicant and at the expense of the infringer. 12.220 No equivalent measures are provided in cases where the right holder is not successful with his claim for infringement against the other party. Yet, Member States may also extend this provision to unsuccessful right holders, although this is not provided for. 12.221 This provision presents a ‘TRIPs Plus’ element and is essentially based on a practice followed in many EU Member States.217 12.222 The publicity measures may consist in the dissemination of information concerning the decision, including displaying the decision and publishing it in full or in part. That may be done by the (print) press (e.g. via newspapers or magazines) or by electronic media (e.g. via the internet by posting something on the infringer’s or/and the right holder’s website, on relevant blogs, via electronic newspapers or magazines) or by broadcasting (radio or TV) or by combining any of the above media. The use of the word ‘appropriate’ indicates that other means of publicity may also be used depending on the circumstances of the case such as mailing or emailing clients or even prominent advertising. 12.223 Excerpts, summaries or the full text of the decision may be published according to what the court orders. 12.224 Since there is no mention thereof in Article 15, Member States are free to provide for the modalities of publication and the type of media to be used. They may again provide for a general provision and leave it to the courts to implement it depending on each case. 12.225 The aim of this provision is triple. First, it has a punitive effect towards the infringer who is publicly discredited (depending on the media of publication) and he also has to bear the expenses for such exposure. Second, it works as a general deterrent to potential infringers. Third, it informs the public.

NOTES See notes at Art. 1.

217

Walter and Goebel, 1316, fn 478. E.g. the laws of Greece, Italy, Germany and Austria.

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ARTICLE 61

CHAPTER III SANCTIONS BY MEMBER STATES ARTICLE 16: SANCTIONS BY MEMBER STATES Without prejudice to the civil and administrative measures, procedures and remedies laid down by this Directive, Member States may apply other appropriate sanctions in cases where intellectual property rights have been infringed.

SELECTED RECITAL (28) In addition to the civil and administrative measures, procedures and remedies provided for under this Directive, criminal sanctions also constitute, in appropriate cases, a means of ensuring the enforcement of intellectual property rights.

RELATED LEGAL INSTRUMENTS TRIPS AGREEMENT SECTION 5 CRIMINAL PROCEDURES ARTICLE 61 Members shall provide for criminal procedures and penalties to be applied at least in cases of willful trademark counterfeiting or copyright piracy on a commercial scale. Remedies available shall include imprisonment and/or monetary fines sufficient to provide a deterrent, consistently with the level of penalties applied for crimes of a corresponding gravity. In appropriate cases, remedies available shall also include the seizure, forfeiture and destruction of the infringing goods and of any materials and implements the predominant use of which has been in the commission of the offence. Members may provide for criminal procedures and penalties to be applied in other cases of infringement of intellectual property rights, in particular where they are committed willfully and on a commercial scale.

I. COMMENTARY Although criminal sanctions were included in the first drafts of the Directive, they were dropped in 12.226 the final text since no agreement could be reached. However, Article 61 of the TRIPs Agreement (ratified by all Member States and the EU) managed to achieve a minimum harmonisation of the criminal laws of the Member States; though many disparities still remain. According to it States Parties should provide for criminal sanctions at least in cases of wilful trademark counterfeiting or copyright piracy on a commercial scale. Although it is not clear from the wording of the TRIPs Agreement whether the term ‘wilful’ also applies to copyright apart from trademark infringements, it would be difficult to think of any cases where copyright piracy on a commercial scale is conducted without intention. Sanctions include imprisonment and/or monetary fines sufficient to provide a deterrent, consistently with the level of penalties applied for crimes of a corresponding gravity. In appropriate cases sanctions also include the seizure, forfeiture and destruction of the infringing goods and of any materials and implements the predominant use of which has been in the commission of the offence. States Parties may also provide for criminal procedures and penalties to be applied in other cases of infringement of IP rights, in particular where such infringements are

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committed wilfully and on a commercial scale. That means that States Parties are free to provide for criminal sanctions even in those cases where infringements are not committed wilfully. 12.227 Article 16 of the Enforcement Directive leaves the issue of criminal sanctions in cases of IP infringements entirely to the Member States’ discretion.218 12.228 On 12 July 2005 the European Commission proposed a Directive on criminal measures aimed at ensuring the enforcement of intellectual property rights in order to supplement the Enforcement Directive.219 It also argued that the proposed Directive should be understood as implementing Article 17(2) of the Charter of Fundamental Rights, which provide that ‘intellectual property shall be protected’. On 13 September 2005 the CJEU held that criminal enforcement comes under the competences of the European Union,220 which was an issue under discussion. Yet, the Directive was considered to be controversial in many respects and was therefore withdrawn.221 The proposed Directive dealt with intentional infringements on a commercial scale as well as aiding, abetting or inciting the infringements. It did also not make prosecution subject to an accusation submitted by the injured party (at least if the acts were committed in the territory of an EU Member State) but rather gave it the form of public prosecution. See further Chapter 21, paragraphs 21.88 to 21.95, on this subject.

NOTES 1. Related instruments Agreement on Trade-Related Aspects of Intellectual Property Rights, 15 April 1994 (TRIPs). Proposal for a European Parliament and Council Directive on criminal measures aimed at ensuring the enforcement of intellectual property rights, COM (2005) 276/1 final, 12.07.2005. See also related instruments at Art. 1.

2. CJEU case law Commission v Council (C-176/03), ECLI:EU:C:2005:542. See also case law at Art. 1.

3. Bibliography See Bibliography at Art. 1.

CHAPTER IV CODES OF CONDUCT AND ADMINISTRATIVE COOPERATION ARTICLE 17: CODES OF CONDUCT Member States shall encourage: (a)

the development by trade or professional associations or organisations of codes of conduct at Community level aimed at contributing towards the enforcement of the intellectual

218 219

According to Reinbothe, 22, Art. 16 was eventually reduced to an almost purely symbolic provision. Proposal for a European Parliament and Council Directive on criminal measures aimed at ensuring the enforcement of intellectual property rights, COM (2005) 276/1 final, 12.07.2005. Case C-176/03 Commission v Council, ECLI:EU:C:2005:542. OJ C 252/9, 18.09.2010.

220 221

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ARTICLE 16: CODES OF CONDUCT

(b)

property rights, particularly by recommending the use on optical discs of a code enabling the identification of the origin of their manufacture; the submission to the Commission of draft codes of conduct at national and Community level and of any evaluations of the application of these codes of conduct.

SELECTED RECITAL (29) Industry should take an active part in the fight against piracy and counterfeiting. The development of codes of conduct in the circles directly affected is a supplementary means of bolstering the regulatory framework. The Member States, in collaboration with the Commission, should encourage the development of codes of conduct in general. Monitoring of the manufacture of optical discs, particularly by means of an identification code embedded in discs produced in the Community, helps to limit infringements of intellectual property rights in this sector, which suffers from piracy on a large scale. However, these technical protection measures should not be misused to protect markets and prevent parallel imports.

RELATED LEGAL INSTRUMENTS E-COMMERCE DIRECTIVE 2000/31 ARTICLE 16: CODES OF CONDUCT 1.

2.

Member States and the Commission shall encourage: (a) the drawing up of codes of conduct at Community level, by trade, professional and consumer associations or organisations, designed to contribute to the proper implementation of Articles 5 to 15; (b) the voluntary transmission of draft codes of conduct at national or Community level to the Commission; (c) the accessibility of these codes of conduct in the Community languages by electronic means; (d) the communication to the Member States and the Commission, by trade, professional and consumer associations or organisations, of their assessment of the application of their codes of conduct and their impact upon practices, habits or customs relating to electronic commerce; (e) the drawing up of codes of conduct regarding the protection of minors and human dignity. Member States and the Commission shall encourage the involvement of associations or organisations representing consumers in the drafting and implementation of codes of conduct affecting their interests and drawn up in accordance with paragraph 1(a). Where appropriate, to take account of their specific needs, associations representing the visually impaired and disabled should be consulted.

I. COMMENTARY Article 17 of the Enforcement Directive has been modelled on Article 16 of Directive 2000/31 on 12.229 e-commerce. It aims at encouraging the development by right owners, collecting societies, consumer, industry, trade, or any other stakeholders’ associations of codes of conduct at EU level aimed at contributing towards the enforcement of IP rights, particularly by recommending the use on optical discs (e.g. CDs, DVDs, and so on) of a code enabling the identification of the origin of

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their manufacture. These codes of conduct may be drafted either at a national or at EU level. Article 17 also encourages the submission of such codes of conduct to the Commission and of any evaluations of the application of these codes of conduct. This submission does not form a prerequisite for the validity or the effect of such codes. It is provided on the basis of an exchange of information, experiences, ideas and best practices in the area. 12.230 Codes of conduct present many advantages in the sense that they save law drafters resources, time and legislative energy. They allow stakeholders to sort out any difficult issues or issues of friction between themselves and end up with mutually acceptable solutions. They do not, however, always present the best guarantees for complying with fundamental principles and rights, especially when not all persons or entities affected by them have participated in their drafting process.222 The term ‘codes of conduct’ is not an exclusive but rather an indicative term. That means that the same role may be served by different means such as ‘codes of ethics’ or ‘codes of practice’ or even ‘terms of use’ or ‘principles’ such as those used by YouTube or Facebook or any other sort of social media platforms, blogs, and so on. 12.231 Codes of conduct may result from different processes (e.g. negotiations between the parties, on the basis of agreements between them, partly on litigation) where the State may be involved to a substantial or lesser degree or not at all. Codes of conduct have become a rather popular way of sorting out copyright issues, which are not clear in law and for which political will is not there to allow the enactment of hard law. A characteristic example in this respect are codes of conduct for copyright infringements on the internet. Examples of this kind are the Model Code of Conduct Provisions on Intellectual Property for Online Service Providers drawn up by the Business Software Alliance (BSA), the Code of Conduct for ISPs drafted jointly in 2005 by the International Federation of Phonographic Industries (IFPI) and the Motion Picture Association (MPA), the Dutch Notice-and-Take-Down Code of Conduct published in 2008, the Irish Code of Practices and Ethics adopted by Irish ISPs in 2002, the Principles for User Generated Content Services adopted in 2007 as a result of an agreement between major film producers and user-generated content services (UGC) in the United Services, the Ofcom (UK) revised Initial Obligations Code proposal,223 which implements legislative measures aimed at reducing online copyright infringement under the Digital Economy Act 2010, and so on.224 12.232 Another example of the cooperative approach advocated by the Commission is the Stakeholders’ Dialogue225 on the Sale of Counterfeit Goods over the Internet, which resulted in a Memorandum of Understanding (MoU) dealing with issues such as prevention, identification, and removal of infringing offers (e.g. through notice-and-take-down procedures) and sellers from internet platforms, repeat infringers, sharing of information between internet platforms and right holders,

222

223 224

See P.B. Hugenholtz, ‘Codes of conduct and copyright enforcement in Cyberspace’, in I. Stamatoudi (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law and Business, Alphen aan den Rijn, 2010, 303. See also M.E. Price and S.G. Verhulst, Self-Regulation and the Internet, Kluwer Law International, The Hague, 2005, and J.P. Mifsud Bonnici, Self-Regulation in Cyberspace, T.M.C. Asser Press, The Hague, 2008. Released on 26 June 2012. See also Report II, 25: In Estonia, it has been reported that a Memorandum of Understanding was signed between Estonian Organisation of Copyright Protection and several internet service providers to enable the removal of material that infringes intellectual property rights. In Denmark, internet service providers together with the Danish IT Industry Association (ITB) and the Telecommunication Industries in Denmark (TI) have agreed to collaborate on combating piracy on the internet and a Code of Conduct for internet service providers concerning the enforcement of intellectual property rights has also been agreed. Similarly in France, the ‘Charte de lutte contre la contrefaçon sur Internet’ was signed between the French online market places and rightholders to advance the fight against the sale of counterfeit goods over the internet.

225

Regarding Stakeholders’ Dialogues, see chapter 21, paragraph 21.97, below.

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ARTICLE 18: ASSESSMENT

external communication and awareness-raising. It also includes a minimum set of consumer protection provisions. Finally, it ensures that signatories do not initiate new litigation against each other concerning matters covered by the MoU. The agreement aims at reducing the sale of counterfeit goods via e-commerce platforms; it does not seek to combat illegal sharing of copyright protected works via the internet. However, its scope also embraces the sale of goods infringing copyright or related rights. An updated version of the MoU was signed in June 2016. The Stakeholders’ Dialogue on Illegal Up- and Downloading, which included representatives from the entertainment industries, ISPs, and telecommunication companies, proved to be less successful. It was launched in 2009 and was terminated less than two years later, without resulting in any specific legislative proposal, nor, for that matter, on any non-legislative action of interest. Another MoU, signed between a number of parties from the internet advertising ecosystem, aims at withholding advertising on IP infringing websites. Work is currently underway on an MoU for the transport and shipping industries, which aims to prevent the services of these companies from being used by commercial-scale counterfeiters to channel fake goods into the EU. A further MoU in preparation is expected to cover providers of payment services.226

NOTES 1. Related instruments Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market, OJ L 178/1, 17.07.2000. See also related instruments at Art. 1.

2. Bibliography Hugenholtz, P.B. ‘Codes of conduct and copyright enforcement in Cyberspace’, in Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law and Business, Alphen aan den Rijn, 2010. Mifsud Bonnici, J.P. Self-Regulation in Cyberspace, T.M.C. Asser Press, The Hague, 2008. Price, M.E. and S.G. Verhulst, Self-Regulation and the Internet, Kluwer Law International, The Hague, 2005. See also Bibliography at Art. 1.

ARTICLE 18: ASSESSMENT 1.

2.

226

Three years after the date laid down in Article 20(1), each Member State shall submit to the Commission a report on the implementation of this Directive. On the basis of those reports, the Commission shall draw up a report on the application of this Directive, including an assessment of the effectiveness of the measures taken, as well as an evaluation of its impact on innovation and the development of the information society. That report shall then be transmitted to the European Parliament, the Council and the European Economic and Social Committee. It shall be accompanied, if necessary and in the light of developments in the Community legal order, by proposals for amendments to this Directive. Member States shall provide the Commission with all the aid and assistance it may need when drawing up the report referred to in the second subparagraph of paragraph 1.

Those MoUs and initiatives are further discussed in chapter 21, paragraphs 21.196–21.198, below.

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SELECTED RECITAL (30) In order to facilitate the uniform application of this Directive, it is appropriate to provide for systems of cooperation and the exchange of information between Member States, on the one hand, and between the Member States and the Commission on the other, in particular by creating a network of correspondents designated by the Member States and by providing regular reports assessing the application of this Directive and the effectiveness of the measures taken by the various national bodies.

I. COMMENTARY 12.233 Article 18(1) provides that three years after implementation of the Directive, Member States shall submit to the Commission a report on such implementation. These reports will help the Commission to draw up a general report on the application of the Directive assessing the effectiveness of the measures taken and evaluating its impact on innovation and the development of the information society. Member States shall also provide the Commission with any other aid or assistance it may need when drawing up this report (Art. 18(2)). This report will then be transmitted to the European Parliament, the Council and the European Economic and Social Committee and will be accompanied – if necessary and in the light of developments in the EU legal order – by proposals for amendments. 12.234 The Directive had to be implemented into the Member States’ national laws by the end of April 2006 (Art. 20(2)). Only five Member States respected the deadline. The last Member States failed to implement the Directive until 2009. The European Commission submitted its first report on the basis of the Member States’ reports on 22 December 2010.227 According to it and on the basis of its Executive Summary: […] A first evaluation of the impact of the Directive shows that noteworthy progress has been made since it was adopted and implemented in the Member States. The Directive created high European legal standards to enforce different types of rights that are protected by independent legal regimes (such as copyright, patents, trademarks and designs, but also geographical indications and plant breeders’ rights). However, despite an overall improvement of enforcement procedures, the sheer volume and financial value of intellectual property rights infringements are alarming. One reason is the unprecedented increase in opportunities to infringe intellectual property rights offered by the Internet. The Directive was not designed with this challenge in mind. Other issues that could need special attention are the use of provisional and precautionary measures such as injunctions, procedures to gather and preserve evidence (including the relationship between the right of information and protection of privacy), clarification of the meaning of various corrective measures, including the costs of destruction, and calculation of damages.228

227 228

Report I and Report II. After the European Commission’s Report a Public Hearing on the Enforcement Directive and the challenges posed by the digital environment was organised by DG Internal Market and Services with support from the European Economic and Social Committee in Brussels on 7 June 2011. This Public Hearing resulted in a Summary Report (MARKT/ZH D (2011)). A Conference – organised by DG Internal Market and Services – on ‘Enforcement of intellectual property rights: the review of Directive 2004/48/EC’ followed on 26 April 2012. According to the EU Commission’s statement on its site: The conference provided further valuable stakeholder input on intellectual property policy, in view of the upcoming review of the Directive by the Commission. In that context, the conference focused on the specific issues related to the enforcement challenges facing SMEs and creators, and on challenges posed in the online environment. From 30.11.2012 to 30.03.2013 the EU Commission conducted a Public Consultation (Civil enforcement of intellectual property rights: on the efficiency of proceedings and accessibility of measures) with the objective to gather specific information on the efficiency of proceedings and accessibility of measures used in the context of civil enforcement of intellectual property rights.

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ARTICLE 18: ASSESSMENT

Infringements of intellectual property rights are a constantly growing phenomenon.229 Neverthe- 12.235 less, there is no doubt that over the past decade the Directive has substantially strengthened the impact of private enforcement of IP rights in the EU. Yet, it follows from the most recent public consultation on the Directive230 that none of the different stakeholders affected by it finds it fully satisfactory. Right holders usually find that it does not go far enough and also regret that, because the measures laid down in the Directive are non-punitive in nature, their deterrent effect is rather modest. Intermediaries and citizens tend to argue that the Directive fails to adequately protect their interests and fundamental rights. All parties have pointed out that, for the sake of legal certainty and in order to avoid divergent approaches at national level, increased clarity regarding some provisions would be welcome, even though the CJEU has been and will still be called upon to provide such clarification to some extent. In November 2017, the Commission issued a guidance aimed at facilitating the Directive’s interpretation and application by the competent judicial authorities and other parties involved in the enforcement of IP rights in proceedings before those authorities.231 More specifically, the guidance aims at: (i) strengthening the efficiency and effectiveness of the IP civil enforcement framework, (ii) ensuring a balanced approach to IP enforcement, including in a digital context, (iii) ensuring a balanced approach to IP enforcement and preventing abuse of measures, procedures and remedies set out in the Directive, and (iv) enhancing the harmonisation of both law and practice throughout the Member States. This guidance is not legally binding. In its Communication of 29 November 2017 entitled ‘A balanced IP enforcement system responding to today’s societal challenges’,232 the Commission pointed out that it would work with Member States’ national experts and judges on further, more targeted guidelines to give more detailed and practical guidance on specific issues addressed by the Directive, based on best practices experiences. In 2011 some doubts were raised as to whether the Enforcement Directive should be updated, 12.236 especially on issues of IP enforcement on the internet.233 There were also arguments that the updating of the legal framework on IP enforcement should take place in the context of Directive 2000/31 on e-commerce rather than in the context of the Enforcement Directive. The review of the Enforcement Directive was initially intended to be combined with the implementation of the Anti-Counterfeiting Trade Agreement (ACTA). ACTA aimed at establishing international standards for IP rights enforcement through the establishment of an international legal framework for targeting counterfeit goods and pirated products. It also created a new governing body outside existing fora, such as the World Trade Organization, the World Intellectual Property or the United Nations. See further on ACTA chapter 21, paragraphs 21.208–21.252, below.

229

230

231

232 233

EUIPO, ‘2020 status report on IPR infringement. Why IP rights are important, IPR infringement, and the fight against counterfeiting and piracy’, June 2020, . European Commission, ‘Synthesis of the Responses: Civil Enforcement of Intellectual Property Rights: Public Consultation on the Efficiency of Proceedings and Accessibility of Measures’, July 2013, . Guidance of 29 November 2017 on Certain Aspects of Directive 2004/48/EC of the European Parliament and of the Council on the enforcement of intellectual property rights (COM (2017) 708 final). Reference has been made to this guidance (‘Guidance’) throughout this chapter. Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee, ‘A balanced IP enforcement system responding to today’s societal challenges’, COM (2017) 707. See for example Commission Communication to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions, ‘A coherent framework for building trust in the Digital Single Market for e-commerce and online services: COM (2011) 942 final where it is stated that: ‘the Commission will revise the Directive on the Enforcement of intellectual property rights in 2012 in order to combat illegal content more effectively and in a manner which upholds the internal market and fundamental rights by improving the framework for civil law proceedings’. See also other relevant parts in the Communication (5 and 13 fn 49).

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12.237 ACTA was signed in 2011 and 2012 by Australia, Canada, Japan, Morocco, New Zealand, Singapore, South Korea, the United States, Mexico, the European Union and 22 EU Member States. ACTA’s intended benefits were thought to be far outweighed by the potential threats to civil liberties, according to British MEP David Martin’s statement in 2012, who was then the newly appointed rapporteur, after Kader Arif’s resignation in protest. One of the issues of friction was the provisions on copyright infringement on the internet. On 4 July 2012, the European Parliament rejected ACTA. Since then its implementation into the national laws of the EU Member States has been stalled.234 12.238 In 2015, the Commission reiterated its intention to decide in the near future whether or not to propose an amendment to the Directive.235 At the time of writing (November 2020) no such decision had yet been taken.

NOTES Wilman, F.G. ‘A decade of private enforcement of intellectual property rights under IPR Enforcement Directive 2004/48: where do we stand (and where might we go)?’ (2017) E.L. Rev., 42(4), 509. See also Notes at Art. 1.

ARTICLE 19: EXCHANGE OF INFORMATION AND CORRESPONDENTS For the purpose of promoting cooperation, including the exchange of information, among Member States and between Member States and the Commission, each Member State shall designate one or more national correspondents for any question relating to the implementation of the measures provided for by this Directive. It shall communicate the details of the national correspondent(s) to the other Member States and to the Commission.

SELECTED RECITAL (30) In order to facilitate the uniform application of this Directive, it is appropriate to provide for systems of cooperation and the exchange of information between Member States, on the one hand, and between the Member States and the Commission on the other, in particular by creating a network of correspondents designated by the Member States and by providing regular reports assessing the application of this Directive and the effectiveness of the measures taken by the various national bodies.

I. COMMENTARY 12.239 Article 19 provides for the designation of correspondents by Member States for the purpose of promoting cooperation, including the exchange of information, between them and the Commission as well as for any question relating to the implementation of the measures provided for by the Directive. The details of the correspondents are to be communicated between all Member States and the Commission.

234

235

ACTA was rejected by the European Parliament in plenary session with 478 voting against the Agreement, 39 voting in favour and 165 MEPs abstaining. See I. Stamatoudi, ‘ACTA, internet service providers and the acquis communautaire’, in Rosen, J. (ed.), Intellectual Property at the Crossroads of Trade, ATRIP Intellectual Property, Edward Elgar Publishing, Cheltenham (UK)/Northampton (US), 2012. European Commission, ‘A digital single market strategy for Europe’, COM (2015) 192, 7–8.

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ARTICLE 20: IMPLEMENTATION

NOTES See Notes at Art. 1.

CHAPTER V FINAL PROVISIONS ARTICLE 20: IMPLEMENTATION 1.

2.

Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 29 April 2006. They shall forthwith inform the Commission thereof. When Member States adopt these measures, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods of making such reference shall be laid down by Member States. Member States shall communicate to the Commission the texts of the provisions of national law which they adopt in the field governed by this Directive.

I. COMMENTARY The Directive had to be implemented by Member States by 29 April 2006. Member States were 12.240 obliged upon implementation to submit the text of the national provisions (implementing the Directive) to the European Commission by the same date. Any future amendments, additions, deletions or alterations to those provisions (or any provisions coming within the scope of the Directive) should also be communicated to the European Commission (para. 2). When Member States implement the Directive into their national law a reference to this Directive 12.241 should be made or their national provisions should be accompanied by such reference on the occasion of their official publication. The method of making such reference is at the Member States’ discretion.236

NOTES 1. CJEU case law Commission v Luxembourg (C-329/07), ECLI:EU:C:2008:9. Commission v France (C-328/07), ECLI:EU:C:2008:113. Commission v Sweden (C-341/07), ECLI:EU:C:2008:284. Commission v Germany (C-395/07), ECLI:EU:C:2008:325. See related instruments and Bibliography at Art. 1.

236

The European Commission brought actions against those Member States, which had not implemented the Enforcement Directive on time, i.e. Luxembourg, France, Sweden and Germany (Cases C-329/07, C-328/07, C-341/07 and C-395/07).

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ARTICLE 21: ENTRY INTO FORCE This Directive shall enter into force on the 20th day following that of its publication in the Official Journal of the European Union.

I. COMMENTARY 12.242 The Directive was published in the Official Journal on 30 April 2004 and entered into force on 20 May 2004.

ARTICLE 22: ADDRESSEES This Directive is addressed to the Member States.

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13 THE ORPHAN WORKS DIRECTIVE Uma Suthersanen and Maria Mercedes Frabboni DIRECTIVE 2012/28/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL OF 25 OCTOBER 2012 ON CERTAIN PERMITTED USES OF ORPHAN WORKS [2012] OJ L299/5

B. Criteria for ‘diligent search’ and ‘good faith’ 2. What constitutes ‘appropriate sources’? 3. Rules on extent and effect of diligent search 4. Recordation and public register A. What must be recorded B. EUIPO Orphan Works Database C. The evolution of a Central EU Database / Register: a critique

ARTICLE 1: SUBJECT MATTER AND SCOPE I.

COMMENTARY 13.01 1. Rationale and objectives 13.01 A. Policy context 13.01 B. Specific objectives 13.06 2. Who are the beneficiary organisations? 13.08 A. Nature of publicly accessible institutions 13.09 B. Film/audio heritage and publicservice broadcasters 13.11 C. Concept of ‘public interest mission’ 13.12 3. Subject matter 13.13 A. Coverage of print and embedded works – writings, images and computer programs works 13.14 B. Cinematographic/audiovisual works, phonograms and broadcasts 13.17 C. Omission of stand-alone photographs and images 13.20 D. Place of publication and unpublished works 13.22 4. Collective management and the Memorandum of Understanding on out-of-commerce works 13.24 COMMENTARY 1. Defining an orphan work A. Policy background B. Definition of an ‘orphan work’ C. Anonymous and pseudonymous works 2. Multiple rightholders A. Multiple authors and owners B. Duration of the orphan work status

13.27 13.27 13.27 13.28 13.30 13.31 13.31 13.32

I.

I.

COMMENTARY 1. What constitutes ‘diligent search’? A. The framework

13.33 13.33 13.33

13.52

COMMENTARY 1. Rationale and expected benefits of the mutual recognition principle 2. If mutual recognition ceases to apply

13.59 13.59 13.61

ARTICLE 5: END OF ORPHAN WORK STATUS I.

COMMENTARY

13.63

ARTICLE 6: PERMITTED USES OF ORPHAN WORKS I.

COMMENTARY 13.66 1. Scope of permitted use 13.66 2. Beneficiaries 13.67 A. Nature of public interest organisation 13.67 B. Third-party platforms and Europeana 13.70 C. Nature of use 13.71 3. Compensation to rightholders 13.73

ARTICLE 7: CONTINUED APPLICATION OF OTHER LEGAL PROVISIONS I.

COMMENTARY

13.75

ARTICLE 8: APPLICATION IN TIME I.

ARTICLE 3: DILIGENT SEARCH

13.43 13.46 13.46 13.48

ARTICLE 4: MUTUAL RECOGNITION OF ORPHAN WORK STATUS

ARTICLE 2: ORPHAN WORKS I.

13.36 13.38

COMMENTARY

13.78

ARTICLE 9: TRANSPOSITION I.

COMMENTARY

13.79

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Chapter 13 THE ORPHAN WORKS DIRECTIVE ARTICLE 10: REVIEW CLAUSE I.

COMMENTARY

ARTICLE 11: ENTRY INTO FORCE 13.82

ARTICLE 12: ADDRESSEES

ARTICLE 1: SUBJECT MATTER AND SCOPE 1.

This Directive concerns certain uses made of orphan works by publicly accessible libraries, educational establishments and museums, as well as by archives, film or audio heritage institutions and public-service broadcasting organizations, established in the Member States, in order to achieve aims related to their public-interest missions. This Directive applies to: (a) works published in the form of books, journals, newspapers, magazines or other writings contained in the collections of publicly accessible libraries, educational establishments or museums as well as in the collections of archives or of film or audio heritage institutions; (b) cinematographic or audiovisual works and phonograms contained in the collections of publicly accessible libraries, educational establishments or museums as well as in the collections of archives or of film or audio heritage institutions; and (c) cinematographic or audiovisual works and phonograms produced by public-service broadcasting organizations up to and including 31 December 2002 and contained in their archives which are protected by copyright or related rights and which are first published in a Member State or, in the absence of publication, first broadcast in a Member State. This Directive also applies to works and phonograms referred to in paragraph 2 which have never been published or broadcast but which have been made publicly accessible by the organizations referred to in paragraph 1 with the consent of the rightholders, provided that it is reasonable to assume that the rightholders would not oppose the uses referred to in Article 6. Member States may limit the application of this paragraph to works and phonograms which have been deposited with those organizations before 29 October 2014. This Directive shall also apply to works and other protected subject-matter that are embedded or incorporated in, or constitute an integral part of, the works or phonograms referred to in paragraphs 2 and 3. This Directive does not interfere with any arrangements concerning the management of rights at national level.

2.

3.

4. 5.

I. COMMENTARY 1. Rationale and objectives A. Policy context 13.01 This chapter analyses Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works.1 This Directive is the result of a legislative process that addressed the legal situation where authors or rights holders of copyright protected works cannot be identified or located. It does this by establishing the conditions under which the orphan work status can be declared throughout the EU region, and under which such works can 1

Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works O J L299/5 (Directive 2012/28 on certain permitted uses of orphan works).

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legitimately be reproduced and made available online. Thus, to a certain extent, the Directive sets out to harmonise the rules on digitisation and online display of ‘orphan works’ by specific institutions. The zeitgeist of the twenty-first century is not only to celebrate humanity’s cultural heritage, but also 13.02 to preserve and maintain it for future generations, whilst ensuring its current accessibility to the public. This task is vested in libraries, museums, archives and other memory institutions – collectively known as cultural heritage institutions. Cultural heritage institutions (CHIs) involved in research, archival, data mining, preservation and access activities have complained that one of the greatest impediments to their digital activities involves ‘orphan works’ and/or ‘out-of-commerce’ works. This is due to the fact that the copyright status of works in such institutions (including printed literature, visual works, photographs, recordings, films and other ephemera which reflect humanity’s culture and history) is often unclear because caretakers cannot identify or locate the copyright owner. As a result, some of these works may not be available for public access owing to the magnitude of research required to obtain copyright clearance. An institution may persevere with its digitisation and access activities despite the lack of copyright clearance or licence arrangements, but then a related issue occurs – the copyright owners or their representatives and heirs may subsequently reappear and claim substantial damages or licensing fees for continued usage of the work. More importantly, this is a risk many CHIs cannot afford to accept in the absence of clear judicial and legislative rules on exceptions. Conversely, there is a justified concern from authors that the notion of cultural rights, with the accompanying rhetoric as to the need to access all forms of intangible heritage, is being employed in order to enable free and uncompensated use of copyright works. In particular, authors who embrace the digital platform (such as blog writers and photographers) are concerned as to the current digitisation practices of commercial institutions whereby their visual works are digitised with the identifying information (metadata) removed in order that the work can be presented as owned by an unauthorised seller. They also wish for legislative intervention in the form of a licensing framework. Unsurprisingly, the orphan works issue has spurred countless legislative reforms and reports from 13.03 the EU, the United States and other nations, all of which demonstrate that large-scale digital library projects are time-consuming and unreasonably costly.2 The phenomenon has also been well mapped in several academic discourses which suggest a myriad of solutions ranging from voluntary orphan works registers to central licensing mechanisms to extended collective mechanisms to the harnessing of blockchain technology.3 From a European perspective, one of the first initiatives was the 2006 European Commission 13.04 Recommendation on the digitisation and online accessibility of cultural content. It comprised a ‘soft law’ approach whereby Member States were encouraged to establish national mechanisms for

2

3

European Commission Recommendation of 24 August 2006 on the digitisation and online accessibility of cultural material and digital preservation (2006/585/EC) O J L236/28 (European Commission Recommendation 2006); i2010: Digital Libraries High Level Expert Group – Copyright Subgroup, Report on Digital Preservation, Orphan Works, and Out-of-Print Works. Selected Implementation Issues (2007); A. Vuopala, Assessment of the Orphan Works Issue and Costs for Rights Clearance (European Commission DG Information Society and Media Unit E4 Access to Information, May 2010); Gowers Review of Intellectual Property (HM Treasury, London, 2006); UK Intellectual Property Office, Impact Assessment BIS1063: Orphan Works (15 June 2012); United States Copyright Office, Orphan Works and Mass Digitization: A Report of the Register of Copyrights (June 2015); Australian Government Productivity Commission, Intellectual Property Arrangements, Inquiry Report No. 78 (2016), at 33. S. van Gompel, ‘The Orphan Works Chimera and how to Defeat it: A View from Across the Atlantic’, (2013) Berkeley Technology Law Journal, 3, 1347–8.; U. Suthersanen, ‘Property and Culture: A Case Study on Orphan Works’, (2017) XXII Art, Antiquity and Law 172–91; R. Tryggvadóttir, ‘Facilitating Transactions and Lawful Availability of Works of Authorship: Online Access to the Cultural Heritage and Extended Collective Licenses’, (2018) The Columbia Journal of Law & The Arts, 41(3), 515–31; D. Hansen, ‘Digitizing Orphan Works: Legal Strategies to Reduce Risks for Open Access to Copyrighted Orphan Works’, K. K. Courtney and P. Suber (eds), Harvard Library, 2016.

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facilitating orphan works’ use, and to create lists of orphan works and public domain works.4 However, such developments were circumscribed by the territorial effect of national measures as juxtaposed against the cross-border online environment: a licence to use or an exception enabling free use of an orphan work in one EU Member State would not guarantee an analogous exclusion from liability in another EU country, or indeed globally. The potential loss of cross-border transactions was exacerbated by the fear that a failure to develop a modern digital regulatory framework would lead to a further loss in the cultural access race especially as compared to the United States.5 Within this context, a push was made to establish a European open portal of information (ARROW) which would aid inter-library searches to assist in mass digitisation activities. This was accompanied by an equally strong momentum to solve the orphan works issue legislatively.6 13.05 And thus it was within this context that the Directive on orphan works was passed, being part of the legislative bundle promulgated under the Digital Agenda for Europe framework.7 The general rationale of the Directive is to address the concern expressed in various quarters regarding the establishment of digital libraries, and the related accessibility of cultural materials, including orphan works.8 One of the primary aims of the Directive is to create a legal framework to ensure lawful, cross-border online access to orphan works,9 enabling institutions to proceed with their digitisation and dissemination activities, with a minimal risk of liability. Discussion on the implementation and efficacy of the Directive is further developed below.10

B. Specific objectives 13.06 Article 1 reframes the general objective in a more specific and limited manner, namely the regulation of the use of certain types of orphan works by certain types of institutions in pursuance of their public interest missions. The two fundamental aspects of regulatory control are: laying down the rules to determine orphan work status within the EU and permitted uses of such works. 13.07 It should be noted that a parallel and co-existing related issue is that of ‘out-of-commerce’ works. This term encapsulates such works which are no longer the object of commercial distribution either in paper or in digital form. Recital 4 expressly states that the Directive does not address the wider issue of ‘out-of-commerce’ works, and instead Member States are allowed to develop specific solutions. On this point, reference is made within the recital to the 2011 Memorandum of Understanding, which attempted to adopt key guidelines in relation to ‘out-of-commerce’ works by advocating voluntary collective management of such works.11

4 5 6 7

8 9

10 11

European Commission Recommendation 2006, numbers (6)–(7). European Commission Impact assessment on the cross-border online access to orphan works, SEC(2011) 615 final (European Commission Impact Assessment 2011), 12. See Chapter 22, Bringing Europe’s cultural heritage online: initiatives and challenges. Directive 2012/28 on certain permitted uses of orphan works, Recital 3; European Commission’s Communication, ‘A Digital Agenda for Europe’ COM(2010) 245 final/2 (EC Communication 2010), 9. See Chapter 23, The digital agenda for Europe, the economy and its impact upon the development of EU copyright policy. Directive 2012/28 on certain permitted uses of orphan works, Recitals 2 and 3. European Commission Explanatory Memorandum to proposal for a directive of the European Parliament and of the Council on certain permitted uses of orphan works, COM(2011) 289 final, 2011/0136 (COD) (EC Explanatory Memorandum 2011), 1. See in particular paras. 13.35, 13.61 and commentary to Arts 9 and 10 of the Directive. ‘Memorandum of Understanding: Key Principles on the Digitisation and Making Available of Out-of-Commerce Works’ (2011) – signed on 20 September 2011 by representatives of European libraries, authors, publishers and collecting societies and witnessed by the Commission (Memorandum of Understanding 2011). This is discussed further below, see para. 13.24.

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ARTICLE 1: SUBJECT MATTER AND SCOPE

2. Who are the beneficiary organisations? Article 1(1) clearly indicates that the Directive only applies to certain uses by a closed list of heritage 13.08 or memory institutions with a ‘public-interest’ mission. The specified institutions are: + + + + + +

publicly accessible libraries publicly accessible educational establishments publicly accessible museums archives film or audio heritage institutions, and public-service broadcasters.

A. Nature of publicly accessible institutions It is arguable that the orphan works Directive applies to both private and public institutions; the 13.09 focus is on whether the public interest mandate is being fulfilled, and whether the usage of orphan works remains non-profit and/or non-commercial. This is clear in the earlier Proposal for a Directive which explicitly allowed Member States to legislate for the use of orphan works for ‘purposes which go beyond the public interest missions of organisations’; in such cases, the Proposal stated that the ‘rights and legitimate interests of rightholders should be protected’, through compensation.12 As discussed further below, an institution may use an orphan work to generate revenue in pursuit of public interest aims. It is further arguable, that private institutions – which engage in commercial activities – are not automatically disqualified as beneficiaries of the Directive if it can be shown that such organisations include publicly accessible and charitable/non-profit organisational arms in the form of libraries, educational units, museums. For example, a corporation which archives cultural artefacts could arguably come within the remit of a publicly accessible educational establishment or an archive – with a public interest mission.13 Conversely, mass digitisation or dissemination activities of a publicly funded museum may not necessarily fall within the Directive’s remit should such a museum exploit the works for commercial purposes beyond their public interest mission.14 It is also clearly implicit that the Directive does not allow individual users to benefit from its safe harbours. And while there is no express definition within the Directive as to the nature or constitution of a 13.10 publicly accessible institution, the phrase ‘publicly accessible’ has been used in the context of two other Directives. Article 5(2)(c), Directive 2001/29 on the information society allows specific acts of reproduction made by ‘publicly accessible libraries, educational establishments or museums, or by archives, which are not for direct or indirect economic or commercial advantage’.15 If we turn to look at the more recent out-of-commerce exceptions within Directive 2019/790 on copyright in the Digital Single Market, one notes that the legal beneficiaries are wider i.e., cultural heritage institutions. The latter are understood as covering publicly accessible libraries and museums ‘regardless of the type of works or other subject matter that they hold in their permanent

12 13

14 15

Proposal for a Directive of the European Parliament and of the Council on certain permitted uses of orphan works, COM(2011) 289 final, 2011/0136 (COD), Recitals 21 and 22 (Proposed Directive 2011). However, would a corporate structure such as Google Art & Culture be a potential beneficiary of this Directive? It is claimed that this Google arm serves a public interest mission by digitising, archiving and making publicly accessible a range of cultural artefacts ranging from paintings, to fashion to indigenous and traditional cultures. Directive 2012/28 on certain permitted uses of orphan works, Recitals 20, 21, Art. 6. This is discussed below. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10 (Directive 2001/29 on the information society).

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collections’.16 A final note is that it is likely that publishing companies who may own or possess orphan works (whether legally or by constructive default) will not be beneficiaries of this Directive.

B. Film/audio heritage and public-service broadcasters 13.11 A stricter threshold is laid down for film/audio heritage institutions and public-service broadcasters. The former should be organisations designated by Member States to ‘collect, catalogue, preserve and restore films and other audiovisual works or phonograms forming part of their cultural heritage’.17 The latter would appear to only cover ‘broadcasters with a public service remit as conferred, defined and organised by each Member State’.18 It is arguable that the higher threshold ostensibly bars institutions and broadcasters, which have a more private and/or commercial remit. The conditions must be satisfied before an entity is declared to be a ‘cultural heritage’ institution or a ‘public service’ broadcaster.

C. Concept of ‘public interest mission’ 13.12 A crucial principle within this Directive is its application to institutions with a public interest mission. There are no express guidelines within the substantive provisions of the Directive as to what factors should be taken into account to determine whether a mission constitutes a ‘public interest’ mission. Some guidelines may be implicit within the recitals. For example, Recital 20 discusses the extent of permitted uses and specifically refers to public interest missions as including ‘the preservation of, the restoration of, and the provision of cultural and educational access to, their collections, including their digital collections’. Similarly, the public interest mission of film or audio heritage institutions covers collection, cataloguing, preservation and restoration of films or phonograms.19

3. Subject matter 13.13 Article 1(2) enumerates exhaustively four types of orphan works that are regulated under this Directive: print works; cinematographic/audiovisual works; phonograms; works embedded in other works or phonograms.

A. Coverage of print and embedded works – writings, images and computer programs works 13.14 Article 1(2)(a) refers to ‘works published in the form of books, journals, newspapers, and magazines’ and ‘other writings’. The latter is a rather broad and sweeping category and it is arguable that the category is overarching enough to include a diverse range of published materials including electronic databases, computer programs, photographs, design drawings, and prints.20 One can stretch the

16

17 18

19 20

Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market OJ L 130/92 (Directive 2019/790 on copyright in the Digital Single Market), Recital 13. Directive 2012/28 on certain permitted uses of orphan works, Recital 20. Ibid. With reference to the acquis, see for example EC Communication on the Application of State Aid Rules to public service broadcasting (2001), OJ C 320/5, at 11. This reflects the content of the Protocol to the Treaty of Amsterdam on the system of public broadcasting in the Member States (1997) OJ C 340/109. Ibid., Recital 20. The UK copyright legislation, for instance, defines a ‘literary work’ as ‘any work, other than a dramatic or musical work, which is written, spoken or sung’, including a table or compilation, a computer program, preparatory design material for a computer program, and a database’, Copyright Designs and Patents Act 1988, s 3.

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argument that the Directive’s reference to ‘writings’ should also cover works which comprise both textual and artistic subject matter.21 Does the term ‘other writings’ include computer programs or video games? We have seen in the past 13.15 decade a growing amount of abandonware, which can also be categorised as orphan works.22 Under international and national laws, computer programs are recognised as literary works.23 However, one can argue that the term ‘other writings’ within Article 1(2)(a) should be restricted ejusdem generis to printed works; while such an interpretation may extend to electronically printed works, it may not necessarily cover computer software. The situation is trickier in relation to video games especially when one breaks up the work into its core component parts of computer code and audiovisual elements – it is then arguable that the latter elements could be considered cinematographic/audiovisual and phonogram works which would fall under Article 1(2)(b) of this Directive.24 One must also read Article 1(2) in conjunction with Article 1(4). The latter refers to a separate 13.16 category of orphan works that will include ‘works and other protected subject-matter’ that are ‘embedded in, or incorporated in, or constitute an integral part of, the works’ referred to in Article 1(2). An artistic work, such as a photograph or a cartoon illustration or a painting which is published in a printed book or as a postcard or as part of an auction catalogue would come under the aegis of the Directive. This argument is strengthened with reference to the travaux preparatoires, the Directive’s Annex, and the orphan works database. The Explanatory Memorandum to the Proposed Directive defined the print sector as covering ‘visual works such as photographs and illustrations contained in these published works’.25 Similarly, the Annex to the current Directive (discussed below) lists sources to be referenced in relation to diligent searches and states that visual works include ‘fine art, photography, illustration, design, architecture, sketches of the latter works and other such works that are contained in books, journals, newspapers and magazines or other works’.26 Finally, the Orphan Works Database (discussed below) includes pictures and photographs as embedded in other works.

B. Cinematographic/audiovisual works, phonograms and broadcasts The next categories of works within the Directive’s ambit are cinematographic, audiovisual and 13.17 phonogram works. Some observations and concerns can be made as to the extent of the coverage. First, such works should be either contained in collections of the beneficiary institutions (Art. 1(1)) or contained within the archives of public-service broadcasting organisations, which produced such

21

22

23

24

25 26

For example, ‘writings’ is defined under the UK law as including ‘any form of notation or code, whether by hand or otherwise and regardless of the method by which, or medium in or on which, it is recorded’, Copyright, Designs and Patents Act 1988, s 178. Abandonware refers to software including old video games which are no longer commercially distributed or sold, or no longer supported having been abandoned by its manufacturer. For arguments as to why the Directive should extend to these works, see H. Maier, ‘Games as Cultural Heritage: Copyright Challenges for Preserving (Orphan) Video Games in the EU’, (2015) Journal of Intellectual Property, Information Technology and E-Commerce Law, 6, 120–31. Agreement on Trade-Related Aspects of Intellectual Property Rights (1994), Art. 10; Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs OJ L 111/16, Art. 1. Case C-355/12 Nintendo Co Ltd v PC Box Srl, 23 January 2014, ECLI:EU:C:2014:25, para. 22 et seq. (‘[…] videogames, such as those at issue in the main proceedings, constitute complex matter comprising not only a computer program but also graphic and sound elements […] [the latter are] protected together with the entire work by copyright in the context of the system established by Directive 2001/29’). EC Explanatory Memorandum 2011, 3. Annex to Directive 2012/28 on certain permitted uses of orphan works, 3.

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works. Secondly, the Directive employs the international copyright terminology of ‘cinematographic’ work27 as opposed to ‘film’. The terms are most likely to be equivalent as they are treated as such in other EU copyright Directives28 and in the references within this Directive to film heritage institutions.29 Thirdly, the inclusion of cinematographic and audiovisual works within the Directive would, arguably, cover not just the recorded work as such, but also recordings or other fixations of moving images and accompanying sounds (if any), including recorded presentations (ranging from PowerPoint slide presentations to Zoom meetings) and complex multimedia works including video games.30 13.18 Finally, Article 1(2)(c) includes such cinematographic and audiovisual works and phonograms that are produced by public-service broadcasting organisations, the rationale being to recognise such broadcasters as phonogram and audiovisual/cinematographic producers. Several further conditions apply to such broadcast-related works: (i) the Directive only affects cinematographic/audiovisual works and phonograms that have been produced before 31 December 2002 – the rationale of the cut-off date is clearly to limit the phenomenon of orphan works within the public broadcaster’s collections;31 (ii) the Directive covers not only works produced by public-service broadcasters but also those that have either been commissioned from third parties for the exclusive use of the broadcaster, or which have been co-produced with other public-service broadcasters – however, works which the broadcasting organisations have been authorised to use under a licensing agreement will not fall within the purview of the Directive.32 13.19 It is not immediately clear why the Directive’s application has been limited to subject matter which has been commissioned or produced by the broadcasting organisations. A tentative suggestion is that this provision may seek to limit the Directive’s safe harbours to cinematographic/audiovisual works and phonograms, which are within the exploitation mandate of the public-service broadcasting organisations, especially in light of cross-border transactions involving other non-EU organisations. Paradoxically, this may mean that some orphan films or phonograms, within the broadcasting organisation’s archival collection, will not be classified as EU orphan works despite the fact that these films or phonograms may be the only physical copies in existence, or may have been specifically donated to the organisation for preservation, etc. It is arguable that where the public-service broadcasting organisation can show that it has obtained either a full copyright assignment or an exclusive licence to use or preserve the work or phonogram especially for uses

27

28

29 30

31

32

Berne Convention for the Protection of Literary and Artistic Works (1886), as amended (Paris Act), Art. 2(1); Agreement on Trade-Related Aspects of Intellectual Property Rights (1994), Art. 11; WIPO Copyright Treaty, adopted on 20 December 1996, Art. 7. Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (codified version) OJ L 376/28, Art. 2 specifies that ‘film’ designates ‘a cinematographic or audiovisual work or moving images …’. See also Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights, OJ L 372/12 (Directive 2006/116/EC on the term of protection), Arts 2 and 3(3); Informational Society Directive – Arts 2 and 3; however, see Directive 93/83/EEC of the European Parliament and of the Council of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, OJ L 248/15, Art. 3(3) referring to cinematographic works. Directive 2012/28 on certain permitted uses of orphan works, Recital 20, Arts 1 and 2. See EU Directives, fn. 28 above; Maier, ‘Games as Cultural Heritage: Copyright Challenges for Preserving (Orphan) Video Games in the EU’, above fn. 22; for the subtle difference between the two, see P. Kamina, Film Copyright in the European Union, Cambridge University Press, Cambridge, 2016, 66–7. The establishment of a cut-off date was opposed in the process of adoption of the text proposed by the Commission. See for example European Parliament Committee on Legal Affairs, Amendments 49–170 – Draft report by Lidia Joanna Geringer de Oedenberg on the proposal for a Directive of the European Parliament and of the Council on certain permitted uses of orphan works (PE475.839v01-00)’ (28.10.2011). Directive 2012/28 on certain permitted uses of orphan works, Recitals 10 and 11.

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which come within Article 6 of the Directive, then such works or phonograms should fall within the scope of this legislation.

C. Omission of stand-alone photographs and images Does the Directive apply to an artistic work per se, namely a work that is not print bound but stands 13.20 alone as a painting or a discrete photograph? What if such a work is ‘published’ within an image library or database?33 Arguably, it is incongruous that single artistic works such as individual photographs or prints which reside within image collections within cultural heritage institutions would be deliberately left out of consideration, and yet individual printed works, cinematographic/ audiovisual works or phonograms would be regulated under this Directive. Nevertheless, there are two factors, which indicate that the Directive does just this. First, the 13.21 Commission’s Impact Assessment report urged that the focus be on the print sector as opposed to the image and photography sectors. The rationale should be contextualised against the then concerns as to commercial digitisation (such as Google’s digitisation project) with its focus on the print sector, and also because printed works (unlike photographs) could be easily indexed by its search engine.34 Secondly, Article 10 of the Directive calls for an impact review by the European Commission on several matters including the possibility of extending the scope of the law to ‘works or other protected subject-matter not currently included in its scope, and in particular stand-alone photographs and other images’.35

D. Place of publication and unpublished works The Recitals state that for reasons of international comity, this Directive only applies to works and 13.22 phonograms that are first published or broadcast in the territory of a Member State.36 Accordingly, Article 1(3) states that in the absence of a publication or a broadcast, the Directive can apply if the work/phonogram in question has been made publicly accessible by the beneficiaries of the Directive.37 This approach may be invoked only in circumstances where a reasonable assumption can be made that the rightholder would not oppose any approved use (as stated under Art. 6). Moreover, Member States can limit the application of the Directive to such unpublished/nonbroadcasted works to those which have been deposited with the beneficiary organisations before 29 October 2014. Thus, the Directive introduces an element of flexibility but its determination may be highly 13.23 uncertain.38 Accordingly, this could be helpful in cases involving obscure early publications, which have already been made publicly accessible within the beneficiaries’ collections. What may prove to be less easy to ascertain is the extra condition placed on such unpublished materials before the Directive can apply. There are no guidelines as to how an institution will be able to prove that unidentifiable or unlocatable rightholders may or may not have authorised specific uses, especially if one is dealing with works created in the pre-digital era. Such guidelines may be useful to beneficiary organisations that hold materials which are obviously confidential, for example private or family correspondence, or anthropological recordings of private tribal ceremonies. The issue is exacerbated

33 34 35 36 37

38

The Annex to Directive 2012/28 on certain permitted uses of orphan works, at 3(c), refers to image databases as a possible source of information in relation to images which are embedded or contained in print works. European Commission Impact Assessment 2011, 6–7. Directive 2012/28 on certain permitted uses of orphan works, Art. 10. Ibid., Recital 12. On the public interest considerations concerning unpublished works, see for example the comments by the Council of the European Union in its Presidency note to the Working Party on Intellectual Property (Copyright) 16438/11 (ST 16438 2011 INIT) (4.11.2011), 2–4. E. Rosati, ‘The Orphan Works Directive, or Throwing a Stone and Hiding the Hand’ (2013) Journal of Intellectual Property Law & Practice, 8(4), 308.

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if orphan works in general are to be managed collectively under the extended collective licensing scheme. One must assume that a court (or a collecting society) faced with this issue would resort to looking at industry practices and conventions.

4. Collective management and the Memorandum of Understanding on out-of-commerce works 13.24 Article 1(5) affirms that the aim of the Directive is not to instruct Member States as to how orphan works in general are to be dealt with in relation to the management of the rights residing within these works at the national level. Moreover, Member States are free to implement any framework of collective or rights management including extended collective licensing, legal presumptions of representation or transfer, and mass digitisation collective management.39 Recital 4 expressly states that the Directive does not address the wider issue of ‘out-of-commerce’ works and that Member States are to actively pursue and implement voluntary agreements between users, rightholders and collective rights management organisations. A national attempt to solve this through extended collective licensing-type measures was attempted in France. However, the legislative measure was declared to be contrary to EU copyright law as set out in Directive 2001/29 on the information society.40 This issue has been somewhat resolved with Directive 2019/790 on copyright in the Digital Single Market which adopts a similar approach to the now-defunct French law. Member States must enable extended collective licensing frameworks so that cultural heritage institutions can be conferred a non-exclusive and non-commercial licence for specified activities in relation to out-of-commerce works (defined as such works which are ‘deemed to be out of commerce when it can be presumed in good faith that the whole work or other subject matter is not available to the public through customary channels of commerce, after a reasonable effort has been made to determine whether it is available to the public’).41 13.25 Where collective agreements are envisioned, account should be taken of the principles agreed upon within the Memorandum of Understanding 2011 (MOU), which attempted to adopt key guidelines in relation to the licensing of out-of-commerce works.42 The MOU had formed an important pillar in the European Commission’s objectives in the Digital Agenda for Europe, namely to further the development of digital libraries in Europe and to provide the widest possible access to European cultural heritage. Despite the document having no legal status, one should note its significance and influence. With signatories representing libraries, publishers, authors and their collecting societies, the document is a recognised step enabling the limitation to copyright as expressed within Article 5(2)(c) of Directive 2001/29 on the information society as being complementary to this Directive, and as originating Articles 8–11 of Directive 2019/790 on copyright in the Digital Single Market. The most notable principles set out by the MOU were: (i)

39 40

41 42 43

both commercial and non-commercial licensing agreements are recognised, though the agreements must define the nature of uses authorised;43

Directive 2012/28 on certain permitted uses of orphan works, Recital 24. Case C-301/15, Marc Soulier, Sara Doke v Ministre de la Culture et de la Communication, 16 November 2016, CJEU, ECLI:EU:C:2016:878. For the ill-fated French law, see Décret n° 2013-182 du 27 février 2013 portant application des articles L. 134-1 à L. 134-9 du code de la propriété intellectuelle et relatif à l’exploitation numérique des livres indisponibles du xxe siècle (French Decree No 2013-182 of 27 Feb. 2013, implementing Arts L134-1 to L134-9 of the French Intellectual Property Code, as amended by Law 2012-287 of 1 March 2012, on the Digital Exploitation of Out-of-Commerce Books of the 20th Century); for a commentary see O. Bulayenko, ‘Permissibility of Non-Voluntary Collective Management of Copyright under EU Law: The Case of the French Law on Out-of-Commerce Books’, (2016) Journal of Intellectual Property, Information Technology and E-Commerce Law, 7, 51–68. Directive 2019/790 on copyright in the Digital Single Market, Arts 8–11, see Chapter 17 this volume. Directive 2012/28 on certain permitted uses of orphan works, Recital 4; Memorandum of Understanding 2011. Memorandum of Understanding 2011, Principle No 1(3).

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(ii) (iii)

(iv) (v)

the moral rights of attribution and integrity will be respected;44 licences will only be granted by collective management organisations in which a substantial number of authors and publishers affected by the Agreement are members and representatives;45 rightholders have the right to opt out of and to withdraw their works from any licensing scheme;46 and collective management organisations will be presumed to represent rightholders who have not transferred the management of their rights.47

The last principle implicitly accepts that where orphan works are identified, there will be a 13.26 presumption of representation by collective management organisations. This will, of course, depend on the mandate of each national collecting society, and whether under national law, extended collective licensing is recognised, the ambit of the mandate, and whether collective management organisations are entitled to represent non-members for specific types of works.

NOTES 1. Related instruments Council of the European Union, Presidency note to the Working Party on Intellectual Property (Copyright) 16438/11 (ST 16438 2011 INIT), 4.11.2011. Directive 93/83/EEC of the European Parliament and of the Council of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, OJ L 248/15, 6.10.1993. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001. Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (codified version) OJ L 376/28, 27.12.2006. Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights, OJ L 372/12, 27.12.2006. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs OJ L 111/16, 5.5.2009. Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works O J L 299/5, 27.10.2012. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market OJ L 130/92, 17.5.2019. European Commission Communication on the Application of State Aid Rules to public service broadcasting (2001), OJ C 320/5, 15.11.2001. European Commission Recommendation of 24 August 2006 on the digitisation and online accessibility of cultural material and digital preservation (2006/585/EC) O J L236/28, 31.8.2006. European Commission’s Communication, ‘A Digital Agenda for Europe’ COM(2010) 245 final/2, 19.5.2010. European Commission Explanatory Memorandum to proposal for a directive of the European Parliament and of the Council on certain permitted uses of orphan works, COM(2011) 289 final, 2011/0136 (COD), 24.5.2011. European Commission Impact assessment on the cross-border online access to orphan works, SEC(2011) 615 final, 24.5.2011. European Commission, Proposal for a Directive of the European Parliament and of the Council on certain permitted uses of orphan works, COM(2011) 289 final, 2011/0136 (COD), 24.5.2011.

44 45 46 47

Ibid., Recital 5. Ibid., Principle No 2(1). Ibid., Principle No 2(5). Ibid., Principle No 2(4).

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Chapter 13 THE ORPHAN WORKS DIRECTIVE European Parliament Committee on Legal Affairs, Amendments 49–170 – Draft report by Lidia Joanna Geringer de Oedenberg on the proposal for a Directive of the European Parliament and of the Council on certain permitted uses of orphan works (PE475.839v01-00), 28.10.2011. ‘Memorandum of Understanding: Key Principles on the Digitisation and Making Available of Out-of-Commerce Works’ (2011) – signed on 20 September 2011 by representatives of European libraries, authors, publishers and collecting societies and witnessed by the Commission. Berne Convention for the Protection of Literary and Artistic Works (1886), as amended (Paris Act). Copyright Designs and Patents Act 1988 (UK). Agreement on Trade-Related Aspects of Intellectual Property Rights (1994). WIPO Copyright Treaty, adopted on 20 December 1996. Protocol to the Treaty of Amsterdam on the system of public broadcasting in the Member States (1997) OJ C 340/109, 10.11.1997.

2. Case law Case C-301/15, Marc Soulier, Sara Doke v. Ministre de la Culture et de la Communication, 16 November 2016, ECLI:EU:C:2016:878. Case C-355/12 Nintendo Co Ltd v PC Box Srl, 23 January 2014, ECLI:EU:C:2014:25.

3. Bibliography Australian Government Productivity Commission, Intellectual Property Arrangements, Inquiry Report No. 78 (2016). Bulayenko, O., ‘Permissibility of Non-Voluntary Collective Management of Copyright under EU Law: The Case of the French Law on Out-of-Commerce Books’ (2016) Journal of Intellectual Property, Information Technology and E-Commerce Law, 7, 51–68. Gompel, S. van, ‘The Orphan Works Chimera and How to Defeat it: A View from Across the Atlantic’ (2013) Berkeley Technology Law Journal, 3, 1347–78. Gowers Review of Intellectual Property (HM Treasury, London, 2006). i2010: Digital Libraries High Level Expert Group – Copyright Subgroup, Report on Digital Preservation, Orphan Works, and Out-of-Print Works. Selected Implementation Issues (2007). Hansen, D., ‘Digitizing Orphan Works: Legal Strategies to Reduce Risks for Open Access to Copyrighted Orphan Works’, K.K. Courtney and P. Suber (eds), Harvard Library, 2016. Kamina, P., Film Copyright in the European Union, Cambridge University Press, Cambridge, 2016. Maier, H., ‘Games as Cultural Heritage: Copyright Challenges for Preserving (Orphan) Video Games in the EU’ (2015) Journal of Intellectual Property, Information Technology and E-Commerce Law, 6, 120–31. Rosati, E., ‘The Orphan Works Directive, or Throwing a Stone and Hiding the Hand’ (2013) Journal of Intellectual Property Law & Practice, 8(4), 303–10. Suthersanen, U., ‘Property and Culture: A Case Study on Orphan Works’ (2017) Art, Antiquity and Law, XXII, 172–91. Tryggvadóttir, R., ‘Facilitating Transactions and Lawful Availability of Works of Authorship: Online Access to the Cultural Heritage and Extended Collective Licenses’ (2018) The Columbia Journal of Law & The Arts, 41 (3), 515–31. UK Intellectual Property Office, Impact Assessment BIS1063: Orphan Works (15 June 2012). United States Copyright Office, Orphan Works and Mass Digitization: A Report of the Register of Copyrights (June 2015). Vuopala, A., Assessment of the Orphan Works Issue and Costs for Rights Clearance (European Commission DG Information Society and Media Unit E4 Access to Information, May 2010).

ARTICLE 2: ORPHAN WORKS 1.

A work or a phonogram shall be considered an orphan work if none of the rightholders in that work or phonogram is identified or, even if one or more of them is identified, none is located despite a diligent search for the rightholders having been carried out and recorded in accordance with Article 3.

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2.

3. 4. 5.

Where there is more than one rightholder in a work or phonogram, and not all of them have been identified or, even if identified, located after a diligent search has been carried out and recorded in accordance with Article 3, the work or phonogram may be used in accordance with this Directive provided that the rightholders that have been identified and located have, in relation to the rights they hold, authorised the organizations referred to in Article 1(1) to carry out the acts of reproduction and making available to the public covered respectively by Articles 2 and 3 of Directive 2001/29/EC. Paragraph 2 shall be without prejudice to the rights in the work or phonogram of rightholders that have been identified and located. Article 5 shall apply mutatis mutandis to the rightholders that have not been identified and located in the works referred to in paragraph 2. This Directive shall be without prejudice to national provisions on anonymous or pseudonymous works.

I. COMMENTARY 1. Defining an orphan work A. Policy background Article 2 of the Directive defines the concept of orphan works for the purposes of EU law. In order 13.27 to appreciate this version, it is helpful to recollect some of the definitions that have been given, in the course of the years, to the problem of orphan works. The list below is an illustration of several different approaches: Orphan works are works that are in copyright but whose rightholders cannot be identified or located. Protected works can become orphaned if data on the author and/or other relevant rightholders (such as publishers, photographers or film producers) is missing or outdated.48 Orphan works are copyrighted works whose owners are difficult or even impossible to locate.49 An orphan work is a work in copyright (or other material protected by copyright) whose rightholders (or at least one of the rightholders) remain unidentified or untraceable making it impossible to get consent for using the work.50 A work is ‘orphan’ with respect to rightholders whose permission is required to use it and who can either not be identified or located based on diligent search on the basis of due diligence guidelines. This search must be both in good faith (subjectively) and reasonable in light of the type of rightholder (objectively).51 Orphan Works are works of art (and other copyrighted material) that are believed or known to be in copyright but whose copyright owner is unknown or untraceable. Orphan Works can be original works of art, or an original image (e.g., a photograph) of a work of art. When an original work of art is out of copyright, images of that work of art may continue to be in copyright.52

48 49

50 51 52

European Commission Communication, ‘Copyright in the Knowledge Economy’ COM(2009) 532 final, 5 (EC Communication 2009). European Commission Communication ‘Europe’s cultural heritage at the click of a mouse: Progress on the digitisation and online accessibility of cultural material and digital preservation across the EU’ COM(2008) 513 final, 6 (EC Communication 2008). A. Vetulani, The Problem of Orphan Works in the EU – An overview of legislative solutions and main actions in this field (2008), 7. The European Digital Libraries Initiative, Sector-Specific Guidelines on Due Diligence Criteria for Orphan Works (2008), 3. MILE (Metadata Image Library Exploitation) Project, ‘What is an Orphan Work?’.

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Chapter 13 THE ORPHAN WORKS DIRECTIVE […] the situation where the owner of a copyrighted work cannot be identified and located by someone who wishes to make use of the work in a manner that requires permission of the copyright owner.53 […] works whose rightholders are not identifiable or rightholders are not locatable […].54

B. Definition of an ‘orphan work’ 13.28 Article 2(1) defines an orphan work as a work that is presumed to be a protected work where: (i) (ii)

‘none of the rightholders in that work or phonogram is identified’; or if one or more of them is identified, the rightholders cannot be located.

A work can only be classified as an orphan work after a potential user fulfils the criteria of diligent search and recordation as set out in Article 3. 13.29 Broadly speaking, the term ‘orphan work’ covers a work in which copyright subsists, and where after a duly diligent search, the owner of the copyright cannot be identified or his whereabouts ascertained. The definition of an orphan work has been a contentious point as there are two approaches determining a work’s status. One solution would have been to define works as public domain works, unless and until the rightholders of the works are identified or located. This ‘opt-in’ approach would have recognised the inherent dilemma that the issue of orphan works raises, namely that the uncertainty regarding the identity of the author or her whereabouts influences the copyright duration of an authorial work since this is dependent on the date of death of the author.55 Instead, the Directive adopts the ‘opt-out’ path where all works with unidentified or unlocated rightholders are considered to be within their term of copyright protection but can be used for specific purposes, subject to the search and recordation conditions. In defining orphan works in this manner, the EU legislator has taken an approach which prioritises risk management for cultural heritage institutions; thus, for instance, this approach answers the problem as defined by the Commission: Orphan works pose a problem because libraries, which are legally obliged to obtain prior authorisation for making works available to the public online, are unable to locate and contact the relevant rightholders. In these circumstances, libraries that make material available online without prior authorisation from rightholders risk being sued for copyright infringement. The potential for infringement is more acute in cases of mass-digitisation projects given their large scale.56

C. Anonymous and pseudonymous works 13.30 Article 2(5) stipulates that national provisions, which govern works by authors who deliberately withhold the attribution of the work and publish either anonymously or under a pseudonym, will not be prejudiced.57 International copyright law makes a specific exception to such works decreeing that the term of protection expires 50 years after the work is published – unless the identity of the author is disclosed or can be presumed, in which case the international norm of life plus 50 years is restored.58 Moreover, the Directive 2006/116/EC on the term of protection deals with such works providing for 70 years’ protection from publication (or if unpublished, creation). Accordingly, most national laws have their own specific guidelines as to how to protect the identity of authors who

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United States Copyright Office, Report on Orphan Works (January 2006), 15. i2010: Digital Libraries High Level Expert Group – Copyright Subgroup, Report on Digital Preservation, Orphan Works, and Out-of-Print Works. Selected Implementation Issues (2007), 9 (with reference to a 2006 interim report). Directive 2006/116/EC of The European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights (Directive 2006/116/EC on the term of protection), Arts 1–2. European Commission Impact assessment on the cross-border online access to orphan works, SEC(2011) 615 final (European Commission Impact Assessment 2011), 9. On the distinction between orphan works and anonymous or pseudonymous works, see ibid., 9, fn. 23. Berne Convention for the Protection of Literary and Artistic Works (1886), as amended (Paris Act), Art. 7(3).

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wished to remain unknown, or how to establish the identity of such authors, or how to apply for compulsory licences for use of such works.59 The concern for a beneficiary organisation would be to establish whether a work/phonogram has been published under these nationally governed circumstances, or whether it has been truly orphaned, and thus falls under the governance of the Directive. The issue may be more difficult in relation to digital works as many contributions posted on the internet are either unidentified or deliberately published under a false identity in order to protect the author’s privacy.

2. Multiple rightholders A. Multiple authors and owners As orphan works, by their nature, do not yield the identity of rightholders easily, there may be 13.31 instances where a work/phonogram is owned by multiple parties whose identity or location may be unknown. Article 2(2) applies when the beneficiary organisation knows that multiple rightholders are involved and where not all of them have been identified or located after a diligent search has been executed. In such instances, the work/phonogram can be used as if it has been classified as an orphan work – provided the identified or located rightholders have given their authorisation in relation to reproduction and communication activities.60 This exception will cease to apply once rightholders have been identified or located. B. Duration of the orphan work status Where a work falls to be declassified as an orphan work under Article 5 of this Directive, Article 13.32 2(4) serves to protect the interests of all rightholders, including those who have yet to be identified and located.

NOTES 1. Related instruments Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights, OJ L 372/12, 27.12.2006. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001. European Commission Communication, ‘Europe’s cultural heritage at the click of a mouse: Progress on the digitisation and online accessibility of cultural material and digital preservation across the EU’ COM(2008) 513 final, 11.8.2008. European Commission Communication, ‘Copyright in the Knowledge Economy’ COM(2009) 532 final, 19.10.2009. European Commission Impact assessment on the cross-border online access to orphan works, SEC(2011) 615 final, 24.5.2011. Berne Convention for the Protection of Literary and Artistic Works (1886), as amended (Paris Act). German Copyright Act 1965 (as amended).

59

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Directive 2006/116/EC on the term of protection, Art. 1(3); for instance, under German law, the copyright term for works published anonymously or under a pseudonym expires 70 years after publication (or if unpublished, after creation) due to the difficulty of ascertaining the date of death of the author; however if the real name is registered in the Register of Anonymous and Pseudonymous Works, the term of copyright is restored to 70 years after the author’s death (German Copyright Act, Art. 66). As set out under Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, Arts 2–3.

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2. Bibliography European Digital Libraries Initiative, Sector-Specific Guidelines on Due Diligence Criteria for Orphan Works (2008). i2010: Digital Libraries High Level Expert Group – Copyright Subgroup, Report on Digital Preservation, Orphan Works, and Out-of-Print Works. Selected Implementation Issues (2007). MILE (Metadata Image Library Exploitation) Project, ‘What Is an Orphan Work?’. United States Copyright Office, Report on Orphan Works (January 2006). Vetulani, A., The Problem of Orphan Works in the EU – An overview of legislative solutions and main actions in this field (2008).

ARTICLE 3: DILIGENT SEARCH 1.

For the purposes of establishing whether a work or phonogram is an orphan work, the organizations referred to in Article 1(1) shall ensure that a diligent search is carried out in good faith in respect of each work or other protected subject-matter, by consulting the appropriate sources for the category of works and other protected subject-matter in question. The diligent search shall be carried out prior to the use of the work or phonogram. 2. The sources that are appropriate for each category of works or phonogram in question shall be determined by each Member State, in consultation with rightholders and users, and shall include at least the relevant sources listed in the Annex. 3. A diligent search shall be carried out in the Member State of first publication or, in the absence of publication, first broadcast, except in the case of cinematographic or audiovisual works the producer of which has his headquarters or habitual residence in a Member State, in which case the diligent search shall be carried out in the Member State of his headquarters or habitual residence. In the case referred to in Article 1(3), the diligent search shall be carried out in the Member State where the organization that made the work or phonogram publicly accessible with the consent of the rightholder is established. 4. If there is evidence to suggest that relevant information on rightholders is to be found in other countries, sources of information available in those other countries shall also be consulted. 5. Member States shall ensure that the organizations referred to in Article 1(1) maintain records of their diligent searches and that those organizations provide the following information to the competent national authorities: (a) the results of the diligent searches that the organizations have carried out and which have led to the conclusion that a work or a phonogram is considered an orphan work; (b) the use that the organizations make of orphan works in accordance with this Directive; (c) any change, pursuant to Article 5, of the orphan work status of works and phonograms that the organizations use; (d) the relevant contact information of the organization concerned. 6. Member States shall take the necessary measures to ensure that the information referred to in paragraph 5 is recorded in a single publicly accessible online database established and managed by the Office for Harmonization in the Internal Market (‘the Office’) in accordance with Regulation (EU) No 386/2012. To that end, they shall forward that information to the Office without delay upon receiving it from the organizations referred to in Article 1(1).

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I. COMMENTARY 1. What constitutes ‘diligent search’? A. The framework Under Article 2 of the Directive, a work or phonogram can only be classified as having an orphan 13.33 status if there is a ‘diligent search’, and the rightholder is not identified or cannot be located. Article 3 lays down the ‘diligent search’ framework in terms of four main issues: ‘diligent search’; the nature of ‘appropriate sources’ to be searched; the geographical and social extent of the search; and the manner of recordation.61 The interpretation and extent of Article 3 has had a great impact on the management and practices of collections by beneficiary organisations. Specifically, Article 3 defines the parameters of diligent search in the following terms: (a) (b) (c) (d)

13.34

prior to any use of the work or phonogram, a ‘good faith’ diligent search must be carried out for each work; beneficiary organisations must consult the ‘appropriate sources’ for the category of works in question; Member States shall determine what will constitute ‘appropriate sources’ for the different categories of works; beneficiary user institutions must record their diligent searches and the results thereof, and make such records available to the relevant public authorities.

Since the adoption of the Directive, the criteria for diligent search as set out at national level and 13.35 recorded through the EUIPO (European Union Intellectual Property Office) database have proven to be a testing threshold to the effectiveness of this legislative text and a consistent harmonised approach to orphan works across the EU. Arguably, the requirements for diligent search have been a stumbling block for the achievement of the objectives of preservation and dissemination of cultural heritage and therefore for the attainment of the fundamental objectives of the Directive. Nevertheless, the implementation of the Directive and the stakeholders’ dialogues it generated prior, during and after its adoption opened doors to a wider discussion and adoption of measures that consider digitisation and access of cultural heritage material that would otherwise remain unavailable.62

B. Criteria for ‘diligent search’ and ‘good faith’ The Directive is not clear as to what steps are required in order to undertake a diligent search. Such 13.36 searches need not be undertaken solely by the beneficiary organisation since Recital 13 recognises that diligent searches for whole collections may be too onerous and expensive for any individual beneficiary institution, and mandates that such searches may be carried out by other organisations for a fee. Arguably, there should be an assumption that if the beneficiary organisation can show that it paid a fee to a third party for a search to be instituted, this will constitute good faith. Nevertheless, the concepts of diligent search and good faith are challenged by the many requirements and technicalities involved in the process. To consider these concepts in context, it should be noted that a presumption of good faith is also a necessary condition for works or other subject matter to be deemed ‘out-of-commerce’ under Article 8(5) of Directive 2019/790 on copyright in the Digital 61

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Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works, Recital 14; European Digital Libraries Initiative, Sector-Specific Guidelines on Due Diligence Criteria for Orphan Works (2008), 4. These include measures contained in Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market (Directive 2019/790 on copyright in the Digital Single Market), as addressed in Chapter 17.

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Single Market. Nevertheless, the presumption of good faith for a work to be deemed ‘out-ofcommerce’ under that Directive can be arrived at ‘after a reasonable effort has been made to determine whether it is available to the public’. The standard set to fulfil the requirement of diligent search under the Orphan Works Directive appears to differ from what constitutes a reasonable effort under Directive 2019/790. The ongoing debate discussed below concerning the impact of painstakingly exhaustive and expensive diligent searches illustrates the conceptual and practical gap between the approaches proposed in the two Directives. It is arguable that Recital 13 of the Directive allows beneficiary organisations to outsource the search especially to third-party organisations who have the search expertise required in the case of cross-jurisdictional databases and sources,63 and in the case of multiple rules on copyright authorship and ownership, which in turn affect the subsistence of copyright in certain works.64 13.37 Recital 14 provides some guidance for Member States. At the time of the adoption of the text, Member States were encouraged to follow the indications offered by the European Digital Libraries Initiative and its Guidelines65 and reference to those guidelines did not yield many specific steps. For example, cultural institutions were encouraged to cooperate and publish search procedures and methodologies,66 but there was no mandatory instruction that stated what such procedures and methodologies might have been. Other hints included: publishing announcements in the media (either trade, professional or press); documenting the searches with dates and names; including statements as to the status of a work within the institution’s information or collections management system.67 The sections below illustrate the progress that has been made so far, and seek to highlight the areas in which further improvement is needed.

2. What constitutes ‘appropriate sources’? 13.38 Article 3(2) clarifies that the list of appropriate sources is to be determined with reference to the list of sources in the Annex of the Directive, as well as that determined by individual Member States, ‘in consultation with rightholders and users’. The reference to ‘rightholders’ sounded anomalous but, right from the inception of the Directive, it was thought that collecting societies who hold a national mandate to operate extended collective licensing (i.e., representation of works of nonrightholders, including orphaned works) would have been part of any national consultation process. The effort towards harmonisation has witnessed and confirmed a definite direct involvement of stakeholders other than beneficiary organisations and National Competent Authorities with the view to attain the objectives of the Directive.68

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64 65 66 67 68

For example, the UK law permits both cultural heritage institutions and any legal or physical person who wishes to license a presumptive orphan work to carry out the search as well; see S. Schroff, M. Favale, and A. Bertoni, ‘The Impossible Quest – Problems with Diligent Search for Orphan Works’ (2017) International Review of Intellectual Property and Competition Law, 48, 286–304. C. Angelopoulos, ‘The Myth of European Term Harmonisation – 27 Public Domains for 27 Member States’ (2012) International Review of Intellectual Property and Competition Law, 43(5), 567–94. i2010: Digital Libraries – High Level Expert Group – Copyright Subgroup, Final Report on Digital Preservation, Orphan Works, and Out-of-Print Works (2008), 14–15. Ibid., 15. Ibid., 16. It is noted that stakeholders other than beneficiary organisations and National Competent Authorities were included in the EUIPO Orphan Works Survey 2017 as documented in European Union Intellectual Property Office, Orphan Works Survey 2017 – Summary Report (2018) (EUIPO Orphan Works Survey 2017). Replies from this group included inputs from associations or entities representing the interests of rights holders, cultural organisations, collective management societies, civil society, as well as individual respondents. A further reference of how stakeholder dialogue is framed in the context of digitisation of collections of cultural heritage institutions, as established under Directive 2019/790 on copyright in the Digital Single Market, Art. 11.

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The Annex to the Directive sets out a long list of sources including legal deposits, library catalogues, 13.39 and authority files maintained by libraries and other institutions; the trade and authors’ or rightholders’ associations in the respective country; existing databases and registries, databases of the relevant collecting or representative societies; sources that integrate multiple databases and registries including ARROW. As this part of the chapter explains, initiatives such as ARROW and those that stemmed from it have proven decisive in the process of advancing the implementation of the Directive and testing its effectiveness. In the implementation, Member States have adopted different approaches to what to include in the 13.40 list of sources that are appropriate in order to conduct a diligent search.69 This has been the focus of an extensive study by the EnDOW project (‘Enhancing access to 20th Century cultural heritage through Distributed Orphan Works clearance’). The EnDOW report on ‘Requirements for Diligent Search in 20 European Countries’ contains an extensive and detailed account of how Member States set out the requirements of diligent search in national legislation.70 The report shows how some countries provide precise or even meticulous lists of sources that need to be consulted for diligent search in relation to specific categories of works.71 Other countries decided to transpose the wording of the Directive. Another approach has been to offer lists that are deemed ‘illustrative’.72 From a review of implementation rules at national levels, a debate remains unresolved as to whether the lists of sources are or should be illustrative or whether it would be preferable for exhaustive checklists to be in place to ensure that, once the given sources have been checked, the standard of diligence is met with certainty.73 As pointed out by Deazley: It has been suggested that if a Member State has provided guidance on diligent search incorporating a list of potentially relevant sources then all those sources should be consulted; otherwise, the search could not be considered diligent. In other words, this concept of diligence requires an exhaustive search of identified sources.74

The EnDow Report articulates the argument that, given the lack of clarity as to the exhaustive or 13.41 illustrative nature of a list, sources beyond the list ought to be consulted if it transpires that this is required to demonstrate that a search has been conducted in good faith.75 In other words, if in the process of a diligent search it emerges that sources beyond the list should be consulted, then the search would not be conducted in good faith i.e., it would not be diligent if only the sources on the list are considered. Some commentators favour the argument that a ‘purposive interpretation’ should be preferred and adopted in a manner that is harmonised across Member States, whereby: [d]iligence should not be characterised by an unthinking adherence to a check-list of sources, however useful and well-crafted. Much will depend on the content of the work and the context in which it is found, as well as the expertise and the knowledge-base of the person conducting the search.76

This approach presents its own difficulties as it appears to introduce an element of subjectivity to the notion of diligence. A further concern endures in relation to works which fall outside the scope of existing databases 13.42 developed by established trade organisations. The European Digital Libraries Initiative Guidelines

69 70 71 72 73 74 75 76

R. Arquero-Avilés, B. Siso-Calvo, and G. Marco-Cuenca, ‘Orphan Works and Diligent Search Procedures in Europe’ (2018) Athens: ATINER's Conference Paper Series, No: LIB2017-2413, 9–10. A. Bertoni, F. Guerrieri and M.L. Montagnani, Requirements for Diligent Search in 20 European Countries (2017). The UK, in particular, emerges as the jurisdiction with the most comprehensive checklists (ibid., 12). Ibid. Ibid, 10. R. Deazley, ‘Digitising the Edwin Morgan Scrapbooks: Conclusion’ (2017), 1. Bertoni, Guerrieri, and Montagnani, note 70, 10. Deazley, note 74, 1.

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suggested that for some sectors which are not represented by professional organisations, a more pragmatic and flexible approach may be viable.77 An example of such a sector is grey literature which comprises both unpublished and private papers, or works which are published by noncommercial publishers such as research institutes or individuals. As this chapter demonstrates, the increase in initiatives seeking to facilitate access to orphan works proves the widening of attention and efforts to open up archives for all types of subject matter, within and beyond the scope of the Orphan Works Directive.

3. Rules on extent and effect of diligent search 13.43 Article 3(3) sets out the geographical extent of the diligent search. The basic rule is that beneficiary organisations will have to carry out one diligent search per work/phonogram in only one Member State. That Member State will be that where the work is first published or broadcast (in the absence of publication); where cinematographic or audiovisual works are concerned, the search must be carried out in the Member State where the producer has her headquarters or habitual residence. In the case of unpublished works or phonograms which have been made publicly accessible by an organisation with the rightholders’ consent (as established under Art. 1(3)), the diligent search will be carried out in the Member State of the organisation which enabled such access. 13.44 One should note the exception to the one-search-per-nation rule under Article 3(4). Should there be any evidence that suggests that relevant information as to rightholders is to be found elsewhere then the diligent search must consult these extraneous sources. The Directive is nuanced as to the extent of these other sources and if such a search extends to countries outside the EU, the provision opens up the debate as to whether there should be a clear link between ‘diligent search’ and viable and sustainable costs for any institution to undertake a diligent search.78 13.45 A reflection on the sustainability of the current system in order to effectively facilitate the digitisation and dissemination of orphan works is required in order to address the efficacy of the Directive. This critique is the focus of empirical studies and risk assessment exercises focused on the costs of diligent searches.79 There are considerable shortcomings to a system that seeks to facilitate cross-border dissemination of orphan works but cannot rely mainly on freely available online ‘appropriate’ sources for diligent searches.80 While there is a varied array of reasons why such sources may not be accessible, this has a direct effect on the cost of diligent searches.

4. Recordation and public register A. What must be recorded 13.46 Under Article 5(2) of the Berne Convention, copyright protection is enjoyed and exercised without the need to comply with formalities including registration of a work.81 All the EU Member States, by virtue of their sovereign and EU membership to the Berne Union and the WTO-TRIPs Agreement,82 grant copyright protection automatically. From this historical context, it can be

77 78

79 80 81 82

Flexibility is advocated specifically in i2010: Digital Libraries – High Level Expert Group – Copyright Subgroup, note 65, 15. This was a recurrent point in the European Commission Impact assessment on the cross-border online access to orphan works, SEC(2011) 615 final (European Commission Impact Assessment 2011) – see in particular the examples listed in Table A6, 56–57. The most significant implications are discussed, for example, in the project entitled ‘Digitising the Edwin Morgan Scrapbooks’ by R. Deazley, K. Patterson and V. Stobo (2017). Bertoni, Guerrieri, and Montagnani, note 70, 16. See also, EUIPO Orphan Works Survey 2017, 28. Berne Convention for the Protection of Literary and Artistic Works (1886), as amended (Paris Act). Agreement on Trade-Related Aspects of Intellectual Property Rights (1994), Art. 9(1).

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appreciated that Article 3 introduces a new type of mandatory registration where use (and not protection) of the work is dependent on the registration of the work in an official register or database. Under Article 3(5), once a diligent search has been conducted, the search procedure and the results of such searches have to be recorded with the appropriate national authorities. An up-to-date list of the Competent National Authorities is available from the EUIPO website. In addition to this, beneficiary organisations must also record the use that such organisations make of orphan works, and any changes that affect the orphan work status of a work. Article 3(6) mandates the establishment of the EUIPO (formerly OHIM – Office for Harmonization in the Internal Market) database as the ultimate recipient of all the Member States’ search and usage recorded data – thus enabling a one-stop source for EU orphan works. It has been reported that the development of national databases has been slow, both in terms of 13.47 number of works that are being registered at national level and in relation to the information that is subsequently communicated to EUIPO.83 The EUIPO Survey 2017 indicated that standards used by beneficiary organisations for storing and exchanging data vary considerably, and those organisations are not persuaded that efforts required for the implementation of a system-to-system integration with the Orphan Works Database would counterbalance the benefits of making a small number of orphan works available.84 This has an unavoidable negative impact on the ability to rely on the mutual recognition of orphan works across Member States.85 With specific reference to the technological demands of register systems, since the introduction of the Directive the development of technologies such as blockchain has been explored to overcome some of the difficulties of recordation for orphan works. Nevertheless, it could be argued that it is not the availability of technology that poses an obstacle to the adoption of more practical solutions, but rather the difficulties surrounding the selection of an agreed, open and fully interoperable registry together with affordable agreed criteria for diligent search.86

B. EUIPO Orphan Works Database The Orphan Works Database has been in operation since October 2014 and is run by the EU 13.48 Intellectual Property Office. The objective of the system is to serve as a single publicly accessible online database on orphan works in the EU.87 It works in cooperation with the Competent National Authorities established in Member States. The communication between Competent National Authorities and EUIPO is key to the success of the objectives of the Directive and EU harmonisation as lack of or delays in the transfer of information between the different parties affects mutual recognition and the ultimate goal of availability of such works. 13.49

The framework of the EUIPO database is set out as follows: Information received from Beneficiary Organisations is forwarded to the EUIPO by the Competent National Authority designated in each Member State, e.g. Ministry of Culture or National Intellectual Property Office. Furthermore, the database allows rights holders to search for orphan works, obtain the contact information of the Beneficiary Organisations using them, and, if they find works classified as orphan of which they are the rights holder, put an end to their orphan work status. It also provides Beneficiary Organisations and Competent National Authorities with reports and statistical data on orphan works that have been recorded in the database.88

83 84 85 86 87 88

Bertoni, Guerrieri, and Montagnani, note 70, 13. EUIPO Orphan Works Survey 2017, 18 and 35. Schroff, Favale, and Bertoni, note 63. B. Bodó, D. Gervais, and J.P. Quintais, ‘Blockchain and Smart Contracts: The Missing Link in Copyright Licensing?’ (2018) International Journal of Law and Information Technology, 26(4), 327. European Observatory on Infringements of Intellectual Property Rights (OHIM), Work Programme 2013, 29; EUIPO Orphan Works Survey 2017, 8. EUIPO Orphan Works Survey 2017, 8.

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13.50 In practice, EUIPO explains that two processes need to be undertaken in sequence. First, the user of a beneficiary organisation in a given territory needs to register with its Competent National Authority in order to activate an account.89 When this account is activated, the user is able to access the Orphan Works Database. Secondly, in order to create an orphan work record, the user logs into the Orphan Work Database, produces and then submits a record. Following this step, the Competent National Authority receives a notification of this pending record and forwards it to the Orphan Works Database. At that point, the record becomes part of the Database.90 The EUIPO Survey 2017 illustrates that a first hurdle for the functioning of the system consists in the achievement of a high level of participants.91 Institutions need to take the proactive step to actually register in order to be part of this mechanism and, according to the survey, many of them have not done so. 13.51 As Member States started to adopt the Directive, it was apparent that it was necessary to reduce the friction and costs of passing information between beneficiaries, Competent National Authorities and EUIPO in order to facilitate the establishment of a database that could represent the authoritative and comprehensive one-stop search hub for certain types of works. The advantages of a single hub in terms of search and clearance costs are key to the legislation. Take the example of a book written by a known author. In an ideal scenario, after a diligent search by an institution in Member State A, the work is declared as having orphan work status because the author cannot be located. A subsequent institution in Member State B, which wishes to use another work written by the same author, need not go any further than to consult the EUIPO database. Moreover, in such cases where the author’s location has been declared as unknown in the central EUIPO database, it may well be that a single search in the EUIPO register will constitute a diligent search in good faith. This ideal scenario illustrates an intuitive positive correlation between the level of information shared by Competent National Authorities and EUIPO and the sustainability of the system. Nevertheless, empirical data gathered so far suggest that the network of beneficiary organisations, Competent National Authorities and other stakeholders consider the use of the database and the requirement of diligent search as implemented within their Member States as excessively burdensome as they require a considerable amount of time and human resources, to the detriment of the ability to use the system effectively.92

C. The evolution of a Central EU Database / Register: a critique 13.52 A number of different projects have been launched to facilitate the identification of works through the use of recognised metadata and identifiers. Their design and infrastructure have supported the gathering of information though the EUIPO Database and merge their findings with the central EUIPO hub. Nevertheless, the issue of databases or ‘registers’ for information concerning copyright ownership (and orphan works specifically) continues to be controversial, given the ongoing risk of duplication of search efforts and associated costs. This is potentially amplified considering three factors: (i) the concurring effects of Article 8 of Directive 2019/790 on copyright in the Digital Single Market; (ii) the existing (albeit limited) overlaps of the Digital Single Market Directive with the Orphan Works Directive; and (iii) the deployment of resources towards mass digitisation of out-of-commerce works. The account below discusses benefits, uncertainties and lessons to be learnt from the developments of projects aimed at facilitating diligent searches, and reflects on the expectation that the normative, actual and prospective subject matters and beneficiaries of the 89

90 91 92

Effectively, the EUIPO register is open only to beneficiary organisations and not to individuals, as pointed out by M. Martinez and M. Terras, ‘“Not Adopted”: The UK Orphan Works Licensing Scheme and How the Crisis of Copyright in the Cultural Heritage Sector Restricts Access to Digital Content’ (2019) Open Library of Humanities, 5(1), 36. EUIPO, ‘Registering a new beneficiary organisation and creating orphan work records in the database’. EUIPO Orphan Works Survey 2017, 13. Ibid., 35.

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Directive remain a moving target. While the justifications for publicly accessible registers for orphan works could be deemed to be not too controversial from a cost-benefit perspective, its practicalities are intricate. In 2009 a Public Hearing was held with the aim of gathering further evidence on how the digitisation and dissemination of orphan works could best be managed in compliance with EU and national copyright rules. In the subsequent report, it was indicated that the consulted parties had supported the idea of creating an: […] international registry containing information about copyright status of works. Registries were seen as facilitating a diligent search and prevent the birth of orphan works in the future. There was general support for the creation of central databases such as the EU-funded ARROW database which will provide users who want to digitise their collections with information on the status of protected works and recognition that registration in such a database would prevent the emergence of orphans in the future.93

ARROW was an example of the several initiatives aimed at building a voluntary database to ease 13.53 diligent searches and ultimately avoid the emergence of new orphans. The project ran from 2008 to 2011 with the following objective: [o]ne search in ARROW should be all you should need to determine the copyright status of a cultural good in Europe. If it were embedded in the forthcoming Directive on orphan works, ARROW could become the official portal in Europe where you can find essential rights information and do automated searches of rightholders and copyrights. In the medium-term, it could cover all European print works (books, magazines, etc.) in the EU, and afterwards – why not? – also photographic and audiovisual works.94

More specifically, ARROW ‘involved, in a pan-European consortium, key representatives of 13.54 stakeholders in the book value chain (national libraries, publishers and collective management organisations, also representing writers – working through their main European associations)’.95 One of the goals achieved by the project illustrates the scope of early efforts to build an infrastructure for the use of orphan works. Accordingly: The key result of the project has been the deployment of the ARROW system as a service to facilitate the identification of right holders (authors/publishers) and the identification of the rights status of works (with particular concern for orphan and out-of-print works). […] The set-up of the technological infrastructure was based on the implementation of the workflow that identified the necessary data providers and data flow to provide a comprehensive set of information on rights holders and rights status.96

The efforts deployed in the setting up and implementation of the ARROW business model 13.55 expanded further into a project named ARROW Plus, which involved a larger number of stakeholders and countries, to reach a critical mass and expand the usefulness and value of the database in question. The project concluded in 2013.97 Crucially, the ARROW initiative highlighted the significance of common identifiers that major stakeholders use for the input and exchange of information. This is a matter that goes beyond the issue of orphan works and affects the core activities of cultural heritage institutions. The usage of shared standards needs to be formally recognised as key to the success of a database. It was observed that ‘[t]he identifiers used by each data source for the same entity may not be the same, especially when a standard identifier is not available …’.98 Libraries or archives, referred to as ARROW ‘data sources’, might have not had

93 94

95 96 97 98

Report on the Public Hearing on Orphan Works, Brussels, 26.10.2009. Neelie Kroes addressing the orphan works challenge – IFRRO (The International Federation of Reproduction Rights Organisations) launch of ARROW+ (Accessible Registries of Rights Information and Orphan Works towards Europeana) Brussels, 10 March 2011 (SPEECH/11/163). ARROW Final Report (30 March 2011), 3. Ibid., 4. ARROW, ARROW Plus factsheet. ARROW, Registry of Orphan Works Management System (Grant Agreement ECP-2007-DILI-527003), 14.

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access to established standard identifiers in the process of recording details of their catalogues. Progress in this regard has been slow, as this chapter has pointed out.99 13.56 ARROW provided a language to certain types of subject matter, geared towards printed material. FORWARD (Framework for a EU-wide Audiovisual Orphan Works Registry) – a project which ran from 2013 to 2017 – focused on audiovisual content with the aim to: create a EU-Wide system for the assessment of rights status of AV works; Build a permanent registry of AV Orphan works, and of Public Domain AV work; Duly record the results of the diligent search (as a service to the institutions having carried it out); Support and foster the creation of rights clearance centers.100

13.57 EnDOW (‘Enhancing access to 20th Century cultural heritage through Distributed Orphan Works clearance’) sought to establish and implement a system that could crowd-source certain phases of the process of diligent search for the rightholders and therefore ultimately reduce costs and promote the adoption of best practices extrapolated from a comparative analysis of national approaches and harmonised solutions. EnDOW’s Diligent Search Tool is an online platform designed to assist a user in taking the steps necessary to conduct a diligent search.101 13.58 Alongside the description of these projects, it is useful to recall that that the choice of EUIPO as a provider of the single European database emerged at a later stage in the drafting process of the Directive. Arguably, this was a pragmatic solution aimed at using an existing infrastructure. However, as the discussion here illustrates, duplication of infrastructure continues to exist and is likely to persist in relation to different categories of work on the one hand, and for different uses of the works on the other. The plan to set up a single database has proven to be far from simple. While cross-links are expected to provide economies and ecologies in the way these works are used, technological convergence remains a hurdle.

NOTES 1. Related instruments Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works O J L 299/5, 27.10.2012. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market OJ L 130/92, 17.5.2019. European Commission Impact assessment on the cross-border online access to orphan works, SEC(2011) 615 final, 24.5.2011. Berne Convention for the Protection of Literary and Artistic Works (1886), as amended (Paris Act). Agreement on Trade-Related Aspects of Intellectual Property Rights (1994).

2. Bibliography Angelopoulos, C., ‘The Myth of European Term Harmonisation – 27 Public Domains for 27 Member States’ (2012) International Review of Intellectual Property and Competition Law, 43(5), 567–94. ARROW Final Report (30 March 2011). ARROW, Registry of Orphan Works Management System (Grant Agreement ECP-2007-DILI-527003). Arquero-Avilés, R., B. Siso-Calvo and G. Marco-Cuenca, ‘Orphan Works and Diligent Search Procedures in Europe’, (2018) Athens: ATINER's Conference Paper Series, No: LIB2017-2413. Bertoni, A., F. Guerrieri and M.L. Montagnani, Requirements for Diligent Search in 20 European Countries (2017).

99 100 101

See above and fn. 82. FORWARD Dissemination Actions Year 3 (2017), 6. http://diligentsearch.eu/diligent-search-tool/.

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ARTICLE 4: MUTUAL RECOGNITION OF ORPHAN WORK STATUS Bodó, B., D. Gervais and J.P. Quintais, ‘Blockchain and Smart Contracts: The Missing Link in Copyright Licensing?’ (2018) International Journal of Law and Information Technology, 26(4), 311–36. Deazley, R., ‘Digitising the Edwin Morgan Scrapbooks: Conclusion’ (2017). European Digital Libraries Initiative, Sector-Specific Guidelines on Due Diligence Criteria for Orphan Works (2008). European Observatory on Infringements of Intellectual Property Rights (OHIM), Work Programme 2013. European Union Intellectual Property Office, Orphan Works Survey 2017 – Summary Report (2018). i2010: Digital Libraries – High Level Expert Group – Copyright Subgroup, Final Report on Digital Preservation, Orphan Works, and Out-of-Print Works (2008). Martinez, M. and M. Terras, ‘“Not Adopted”: The UK Orphan Works Licensing Scheme and How the Crisis of Copyright in the Cultural Heritage Sector Restricts Access to Digital Content’ (2019) Open Library of Humanities, 5(1), 1–51. Schroff, S., M. Favale and A. Bertoni, ‘The Impossible Quest – Problems with Diligent Search for Orphan Works’ (2017) International Review of Intellectual Property and Competition Law, 48, 286–304.

ARTICLE 4: MUTUAL RECOGNITION OF ORPHAN WORK STATUS A work or phonogram which is considered an orphan work according to Article 2 in a Member State shall be considered an orphan work in all Member States. That work or phonogram may be used and accessed in accordance with this Directive in all Member States. This also applies to works and phonograms referred to in Article 2(2) in so far as the rights of the non-identified or non-located rightholders are concerned.

I. COMMENTARY 1. Rationale and expected benefits of the mutual recognition principle Once the orphan status of a work has been established, the work is deemed an orphan work 13.59 throughout the EU. The rationale of this provision, as set out in both the Impact Assessment and Recital 8 of the Directive, is twofold. First, there is the intention of ensuring legal certainty throughout the EU.102 Secondly, an efficiency goal could be attained if the resulting system avoids the need for multiple diligent searches and duplication of tasks.103 The Explanatory Memorandum to the Directive illustrated that the mutual recognition principle would make it possible for orphan works to be made available online for cultural and educational purposes without further prior authorisation from each Member State;104 unless the owner of the work puts an end to the orphan status under Article 5 (see below). The adoption of a system of mutual recognition has been commended as an example of how 13.60 harmonisation efforts could produce workable cross-border solutions to overcome the territorial nature of copyright.105 It is observed that the mutual recognition option was perceived as the most pragmatic approach by both the publishing industry and by Member States. In this regard, it is noted that publishers emphasised that no orphan work status regime could be viable without an a

102 103 104

105

European Commission Impact assessment on the cross-border online access to orphan works, SEC(2011) 615 final (European Commission Impact Assessment 2011), 33–37. Ibid., 29–33. European Commission Explanatory Memorandum to proposal for a directive of the European Parliament and of the Council on certain permitted uses of orphan works, COM(2011) 289 final, 2011/0136 (COD) (EC Explanatory Memorandum 2011), 1. M. Janssens and R. Tryggvadóttir, ‘Orphan Works and Out-of-commerce Works to Make the European Cultural Heritage Available: Are We There Yet?’, in I. Stamatoudi (ed), The Future of Copyright. A European Union and International Perspective, Kluwer Law International, Alphen aan den Rijn, 2016, 208.

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priori diligent search to establish the orphan work status of a work; Member States believed that the mutual recognition principle provided a high level of ‘legal certainty for the library community while respecting different legal and cultural traditions’.106

2. If mutual recognition ceases to apply 13.61 In face of the benefits that mutual recognition of orphan works can bring across jurisdictions, a new challenge to its efficacy has emerged in relation to the UK’s withdrawal from the EU.107 It is useful to recall that the UK has two systems in place which allow for the use of orphan works. The exception contained in the Directive has been implemented and works alongside the Orphan Works Licensing Scheme. At the time of writing, under the scheme it is possible to apply for a licence that can be for commercial or non-commercial use; the licence can be non-exclusive, i.e., not restricted to a single licensee; it can last up to seven years and can be renewed. Crucially, however, a licence would only be valid for use in the UK.108 The Orphan Works Licensing Scheme does not contain the same limitations which are present in the Directive in terms of types of works that can be deemed orphans. 13.62 This is a test case that could validate the expected advantages of the system of mutual recognition and verify what happens when a country departs from the safeguards provided under such a system. If the terms set out by the UK IPO in its Guidance are confirmed, mutual recognition will cease with direct consequences for beneficiary organisations. The actions cultural heritage institutions in the UK will be expected to have taken by 1 January 2021 are as follows: remove any orphan works currently placed online under the exception; consider seeking a licence under the UK’s orphan works licensing scheme; where they have a licence to use the work in the UK, consider limiting online access to users based in the UK to avoid copyright infringement in the EEA.109 The consequences for beneficiary organisations of the abandonment of mutual recognition, therefore, entail potentially significant costs. Moreover, in the UK the ability to only rely on the domestic Orphan Works Licensing Scheme ought to be understood in light of the many criticisms that the scheme has attracted in relation to the time-consuming nature of the licensing process, and the costs incurred even when seeking non-commercial licences, and the overall obstacles that the scheme imposes on cultural heritage organisations ideally seeking to engage in mass digitisation of orphan works.110

NOTES 1. Related instruments European Commission Explanatory Memorandum to proposal for a directive of the European Parliament and of the Council on certain permitted uses of orphan works, COM(2011) 289 final, 2011/0136 (COD), 24.5.2011. European Commission Impact assessment on the cross-border online access to orphan works, SEC(2011) 615 final, 24.5.2011. The Intellectual Property (Copyright and Related Rights) (Amendment) (EU Exit) Regulations 2019. UK IPO Guidance, ‘Orphan works and cultural heritage institutions: copyright from 1 January 2021’ (30 January 2020).

106 107 108 109 110

European Commission Impact Assessment 2011, 33–4. The Intellectual Property (Copyright and Related Rights) (Amendment) (EU Exit) Regulations 2019, 11–12, 23 and 31. UK IPO Guidance, ‘Copyright: orphan works’ (last updated on 4 May 2020). UK IPO Guidance, ‘Orphan works and cultural heritage institutions: copyright from 1 January 2021’ (30 January 2020). See Martinez, and Terras, note 89; and Deazley, note 74, 2.

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ARTICLE 5: END OF ORPHAN WORK STATUS

2. Bibliography Janssens M. and R. Tryggvadóttir, ‘Orphan Works and Out-of-commerce Works to Make the European Cultural Heritage Available: Are We There Yet?’, in I. Stamatoudi (ed.), The Future of Copyright. A European Union and International Perspective, Kluwer Law International, Alphen aan den Rijn, 2016, 189–209. Martinez, M. and M. Terras, ‘“Not Adopted”: The UK Orphan Works Licensing Scheme and How the Crisis of Copyright in the Cultural Heritage Sector Restricts Access to Digital Content’ (2019) Open Library of Humanities, 5(1), 1–51.

ARTICLE 5: END OF ORPHAN WORK STATUS Member States shall ensure that a rightholder in a work or phonogram considered to be an orphan work has, at any time, the possibility of putting an end to the orphan work status in so far as his rights are concerned.

I. COMMENTARY The provision is self-explanatory in that should an unidentified or unlocated rightholder come 13.63 forward to assert her rights, she has the ‘possibility’ of ending the orphan work status of her work. Nevertheless, the provision offers no guidelines for two foreseeable events.111 First, what is the standard of evidence and documentation required for a rightholder to prove her assertion of copyright ownership? Secondly, there is no indication as to whether the rightholder must assert her rights within a certain period of time. Thirdly, can the rightholder assert her rights in any of the EU jurisdictions, or is she limited to the jurisdiction where the first diligent search took place, as set out in Article 3(3) of this Directive? Will there be a central EU mechanism, via the EUIPO Central Registry, whereby rightholders can assert their claims, and have their interest lodged in the database while the matter is adjudicated upon in the relevant Member State? The issue is further exacerbated in the case of multiple rightholders. This provision, read together 13.64 with Article 2, makes it clear that in such a situation, should one or some of the rightholders be identified or located, the orphan status of the work ceases, and the continued use of the work is dependent upon the authorisation of the identified and/or located rightholders. One should also note that different jurisdictions have diverging copyright rules as to authorship and ownership – thus, a work can be claimed to be owned by an employer-firm in one jurisdiction (as under UK and Dutch copyright law), but the right may vest in the employee-author in other jurisdictions (as under French and German copyright laws). The ability to locate the employer in some jurisdictions will revoke the orphan work status in some countries, but not in others.112 The burden of checking the orphan status of a work continuously appears to fall on the beneficiary 13.65 institution though with the implementation of the Directive in Member States, national divergences arise – see discussion to Article 3 above. This issue – only partly addressed in Recital 18113 – will have practical implications on the question of compensation payable to such rightholders (set out in Art. 6), especially if such information is available nationally but is not immediately lodged with the central EUIPO register. Finally, the provision is clear that the end of the orphan work status should only be instituted by the rightholder in question, and not on behalf of such a 111 112 113

Rosati, note 38, 309. E.K. Baker, ‘It’s a Hard Knock Life: A Critique of the Legislative Response to the Orphan Works Problem in the UK’ (2016) UCL Journal of Law and Jurisprudence, 5(1), 1–30. Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works, Recital 18.

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rightholder by other representative organisations including collective management organisations. The question which remains is whether a collecting society which operates under a national extended collective licensing mandate will be allowed to claim the right to end orphan status.

NOTES 1. Related instruments Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works O J L 299/5, 27.10.2012.

2. Bibliography Baker, E.K., ‘It’s A Hard Knock Life: A Critique of the Legislative Response to the Orphan Works Problem in the UK’ (2016) UCL Journal of Law and Jurisprudence, 5(1), 1–30. Rosati, E., ‘The Orphan Works Directive, or Throwing a Stone and Hiding the Hand’ (2013) Journal of Intellectual Property Law & Practice, 8(4), 303–10.

ARTICLE 6: PERMITTED USES OF ORPHAN WORKS 1.

2.

3. 4. 5.

Member States shall provide for an exception or limitation to the right of reproduction and the right of making available to the public provided for respectively in Articles 2 and 3 of Directive 2001/29/EC to ensure that the organizations referred to in Article 1(1) are permitted to use orphan works contained in their collections in the following ways: (a) by making the orphan work available to the public, within the meaning of Article 3 of Directive 2001/29/EC; (b) by acts of reproduction, within the meaning of Article 2 of Directive 2001/29/EC, for the purposes of digitisation, making available, indexing, cataloguing, preservation or restoration. The organizations referred to in Article 1(1) shall use an orphan work in accordance with paragraph 1 of this Article only in order to achieve aims related to their public-interest missions, in particular the preservation of, the restoration of, and the provision of cultural and educational access to, works and phonograms contained in their collection. The organizations may generate revenues in the course of such uses, for the exclusive purpose of covering their costs of digitising orphan works and making them available to the public. Member States shall ensure that the organizations referred to in Article 1(1) indicate the name of identified authors and other rightholders in any use of an orphan work. This Directive is without prejudice to the freedom of contract of such organizations in the pursuit of their public-interest missions, particularly in respect of public–private partnership agreements. Member States shall provide that a fair compensation is due to rightholders that put an end to the orphan work status of their works or other protected subject-matter for the use that has been made by the organizations referred to in Article 1(1) of such works and other protected subject-matter in accordance with paragraph 1 of this Article. Member States shall be free to determine the circumstances under which the payment of such compensation may be organised. The level of the compensation shall be determined, within the limits imposed by Union law, by the law of the Member State in which the organization, which uses the orphan work in question is established.

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ARTICLE 6: PERMITTED USES OF ORPHAN WORKS

I. COMMENTARY 1. Scope of permitted use Once a work or phonogram is classified as being an orphan work, the beneficiary institutions can 13.66 reproduce and make available such works. The acts of reproduction and making available are defined under Articles 2 and 3 of Directive 2001/29/EC.114 It is notable that no other right is affected, including the EU-wide right of distribution.115 This is also not the first instance within EU law when a specific exception has been made in relation to the right of reproduction for publicly accessible libraries, educational establishments, museums or archives.116 However, this Directive extends the exception to the making available right, and sets out in greater detail the parameters of the permitted uses. Several limitations apply to institutional usage,117 namely: (a) (b)

(c)

orphan works can only be reproduced for the purpose of digitisation, making available, indexing, cataloguing, preservation or restoration; orphan works can only be used in order to achieve aims related to their public interest missions, notably preservation, restoration and the provision of cultural and educational access to works and phonograms contained in their collections; where rightholders and authors have been identified (but presumably not located), their names must be indicated when the work is used.

2. Beneficiaries A. Nature of public interest organisation A recurring dilemma of this Directive is whether the provisions apply to non-State or privately 13.67 subsidised organisations with a public interest and free access ethos, such as non-governmental organisations or not for profit or charitable organisations. Recital 20 states that film heritage institutions should ‘cover organizations designated by Member States to collect, catalogue, preserve and restore films forming part of their cultural heritage’,118 which implies a publicly governed body; similarly, public-service broadcasters are defined as covering broadcasters with a ‘public service remit’, as per Member States’ Regulations. Recital 22, on the other hand, acknowledges that many digitisation projects must involve commercial partners able to provide both technical and financial assistance.119 There is a clear public policy objective that can be obtained when private or charitable non-State institutions are able to benefit from the safety net established under the Directive as long as they can prove their public interest missions, including making their collections publicly accessible, and if their use of orphan works does not generate profits. A further observation concerns the true extent of the opportunities that the Directive offers under 13.68 Article 6(4), when beneficiaries rely on collaborations with private bodies. It is maintained that, even in presence of public-private partnership agreements, the party that is allowed to physically

114

115 116 117

118 119

Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10 (Directive 2001/29 on the information society). Ibid., Art. 4. Ibid., Art. 5(2)(c). See in this regard European Commission Impact assessment on the cross-border online access to orphan works, SEC(2011) 615 final (European Commission Impact Assessment 2011): ‘This approach links into the non-commercial vocation of Europeana and the objective of ensuring the widest dissemination of knowledge’ (16, fn. 48). Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works, Recital 20. Ibid., Recital 22.

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digitise the object remains the beneficiary organisation and this can be an obstacle for commercial partners’ willingness to enter into those agreements. As argued by Montagnani and Zoboli: Although there may be commercial partners that, having a particular interest in certain collections, are willing to finance digitization, even in the absence of an economic return, most of the PPPs consist of large-scale digitization projects … as, generally, private parties’ interests lie in creating large data sets suitable for data and text mining. Therefore, they usually prefer to digitize with their own means and will conclude by leaving a digitized copy to those institutions that provided the ‘raw’ content or by allowing them access to the digitized version.120

13.69 This observation challenges the potential that public-private partnerships could provide to the digitisation projects that the Directive seeks to facilitate. Nevertheless, also on this topic a shift of focus is occurring, following the effects of the adoption of Directive 2019/790 and the changes that could be brought about on matters concerning mass digitisation and data mining as affected under that piece of legislation.

B. Third-party platforms and Europeana 13.70 The appreciation of what falls within the scope of permitted use under Article 6 is closely dependent on the developments that continue to affect the interpretation of the notion of reproduction and communication to the public under EU law. In addition, the evolution of the acquis affects the legal responsibilities of platforms in relation to the content they are involved in.121 With reference to availability and visibility of orphan works through platforms such as Europeana or similar databases, a question has emerged with regard to the permissibility of the actions of third parties (i.e., intermediaries) that offer hyperlinks – via surface linking or deep linking – to works that beneficiary organisations make available legitimately, once the criteria set out in this Directive have been fulfilled or thanks to the fact that the material is already in the public domain. Europeana is the leading example of a platform that aggregates metadata and provides access to cultural heritage material from thousands of institutions across Europe. It has been observed that the agreements between Europeana and the institutions that feed information to the platform ‘fall in line with the activities available to the beneficiary organisations under the Orphan Works Directive’.122 The scope of the activities of platforms such as Europeana is interesting also in relation to other issues raised above for works that are out-of-commerce and regulated under Directive 2019/790 on copyright in the Digital Single Market, and for the overlaps between this more recent piece of EU legislation and the Orphan Works Directive. For this reason, this remains a topic to be monitored in the years to come.

C. Nature of use 13.71 The ‘not-for-profit use’ principle is underlined under Article 6(2), which sanctions the generation of revenues by beneficiary organisations but only for the exclusive purpose of underwriting the expenses of digitisation and communication of the orphan works to the public. Presumably, this principle will apply to exclude use by national cultural heritage institutions if such organisations exploit orphan works for commercial purposes beyond their public interest mission. On the other hand, as explained above the principle does not exclude the opportunities that may arise when public–private partnerships agreements are concluded with commercial entities, where such partnerships are made in the pursuit of the organisation’s public-interest mission.123

120 121 122 123

M.L. Montagnani and L. Zoboli, ‘The Making of an “Orphan”: Cultural Heritage Digitization in the EU’ (2017) International Journal of Law and Information Technology, 25(3), 205. This is part of a full discussion in Chapter 17. Montagnani and Zoboli, note 120, 201. European Commission Impact Assessment 2011, 38.

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ARTICLE 6: PERMITTED USES OF ORPHAN WORKS

The difficulty one encounters in interpreting Article 6 is the two different stances adopted in 13.72 relation to use of a work, namely whether the use is for ‘public interest missions’ or use for the generation of revenues. Take the example of a national museum, which enters into a public–private partnership with a commercial third party in order to reproduce and make available its entire collection online. The beneficiary organisation is allowed to accept financial contributions from a commercial entity for its public interest mission. Can the beneficiary organisation go further and grant conditional access to certain orphan works upon payment of a fee? It is arguable that the revenue generated by the access fee is necessary in order to cover the costs of digitisation, and this is specifically allowed under Article 6(2). Will the organisation be able to further earmark these revenues for the general maintenance and preservation of all other orphan works in its collection? The answer is not clear as the first sentence of Article 6(2), in conjunction with Article 6(4), allows use for the purposes of preservation, restoration and provision of access to such works and empirical evidence shows that risk assessments are likely to be decisive in the process of selecting whether or not to proceed with the use of the relevant works. On the other hand, it is very clear from Recital 22 that third-party commercial partners will not be entitled to any rights to use or control the use of orphan works. Accordingly, such a restriction on uses that are permitted under Article 6 could lead to a situation where potential commercial partners are unlikely to receive sufficient incentives to be involved in a project that only gives them a reputational advantage.124

3. Compensation to rightholders It should be noted that Article 6 does not provide a complete defence to the use of an orphan work. 13.73 Instead, beneficiary organisations are entitled to use a work, in pursuit of public interest missions, until the orphan work status of that work ends. At this point, a ‘fair compensation’ is payable to the rightholder.125 What factors should be taken into account in order to determine the amount of fair compensation due? The interpretation of what constitutes ‘fair compensation’ can be informed by the way it has developed within the acquis126 but there are no guidelines within the Orphan Works Directive, and Member States are free to determine the level of, and circumstances under which, the compensation is payable.127 The inherent difficulty with Article 6(5) is that it is represents the convergence of rules that were previously envisaged in respect of two different types of uses. In the previous Draft Directive on orphan works, no compensation was payable upon the end of an orphan status of a work, if the beneficiary institutions used the work within their public interest remit.128 The Draft Directive went further than the current statute to also confer a discretionary allowance on Member States to permit non-public interest uses; in such instances, compensation was payable to the rightholder upon the expiry of the orphan status of a work.129 The Draft Directive also set out a statutory limitation within which a claim could be made i.e., five years from the date of the act giving rise to a claim brought after the end of the orphan work status.130 The open-ended nature of the current provision is a concern to user organisations, and one may 13.74 speculate whether the amount of compensation payable should be subject to further circumstances

124 125

126

127 128 129 130

Montagnani and Zoboli, note 120, 206. On the possible advantages and disadvantages of ex post compensation, see S. van Gompel, ‘Unlocking the Potential of Pre-existing Content: How to Address the Issue of Orphan Works in Europe’ (2007) International Review of Intellectual Property and Competition Law, 38(6), 669–702. With regard to the challenges of reconciling the concepts of ‘fair compensation’ and ‘appropriate remuneration’ in the context of the acquis, see J.P. Quintais, Copyright in the Age of Online Access: Alternative Compensation Systems in EU Law, Ch 3. See also Directive 2001/29 on the information society, Recital 18. Proposal for a Directive of the European Parliament and of the Council on certain permitted uses of orphan works, COM(2011) 289 final, 2011/0136 (COD), Art. 6. Ibid., Art. 7. Ibid., Art. 7.1, para. 5.

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including: the date from which the compensation is calculated; whether reasonable notice of the orphan status of a work is required, and if so, what constitutes reasonable notice (if, for example, the work’s orphan status is revoked in a national database, but not on the EU central register); innocent use of a work; the absence of a market value of the work prior to institutional usage (if, for example, the work was an out-of-print, educational work); and the presence of a national collective management framework.

NOTES 1. Related instruments Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001. Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works O J L 299/5, 27.10.2012. European Commission Impact assessment on the cross-border online access to orphan works, SEC(2011) 615 final, 24.5.2011. European Commission, Proposal for a Directive of the European Parliament and of the Council on certain permitted uses of orphan works, COM(2011) 289 final, 2011/0136 (COD), 24.5.2011.

2. Bibliography Gompel, S. van, ‘Unlocking the Potential of Pre-existing Content: How to Address the Issue of Orphan Works in Europe’ (2007) International Review of Intellectual Property and Competition Law, 38(6), 669–702. Montagnani, M.L. and L. Zoboli, ‘The Making of an “Orphan”: Cultural Heritage Digitization in the EU’ (2017) International Journal of Law and Information Technology, 25(3), 196–212. Quintais, J.P., Copyright in the Age of Online Access: Alternative Compensation Systems in EU Law, Kluwer Law International, Alphen aan den Rijn, 2017.

ARTICLE 7: CONTINUED APPLICATION OF OTHER LEGAL PROVISIONS This Directive shall be without prejudice to provisions concerning, in particular, patent rights, trade marks, design rights, utility models, the topographies of semi-conductor products, typefaces, conditional access, access to cable of broadcasting services, the protection of national treasures, legal deposit requirements, laws on restrictive practices and unfair competition, trade secrets, security, confidentiality, data protection and privacy, access to public documents, the law of contract, and rules on the freedom of the press and freedom of expression in the media.

I. COMMENTARY 13.75 This provision should be read in conjunction with Recital 24 which states that: The exception or limitation established by this Directive to permit the use of orphan works is without prejudice to the exceptions and limitations provided for in Art. 5 of Directive 2001/29/EC. It can be applied only in certain special cases which do not conflict with the normal exploitation of the work or other protected subject-matter and do not unreasonably prejudice the legitimate interests of the rightholder.

13.76 The inclusion of this provision is customary practice in EU Directives, and more specifically in those Directives shaping the harmonisation of copyright and related rights. It is interesting to consider the aim of this provision in light of the overall rationale and objectives of the Directive, namely the establishment of a limited exception, to be implemented across the Member States. While the Directive widens the scope of permitted acts, this provision limits it by validating other

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ARTICLE 8: APPLICATION IN TIME

entitlements that may arise under other forms of legislation or even by contract. Recital 24 makes it clear that all other exceptions and limitations provided for under Article 5 of Directive 2001/29 on the information society are applicable, and that the three-step test will apply herein. What is of more concern is the absence of language nullifying any attempt, especially contractually, 13.77 to negate the effects of the Directive. This is especially an issue in respect of orphan works residing within commercial digital databases with technical protection measures. In such an event, can the licence between institutions and the publisher override the exceptions allowed under the Directive?131 Should a controversy arise on the effective scope of the mandatory exception contained in this Directive, it is useful to consider for example the scope of Article 5(5) of Directive 2001/29 on the information society in the context of the acquis.132 While the Infopaq decision appears to suggest that a narrow interpretation is to be preferred, the FAPL v QC Leisure decision provides some reassurance that the interpretation of an exception should not lead to a negation of that exception, but should make that exception effective and able to function in accordance with its purpose. Article 7 of the Orphan Works Directive, therefore, could be considered in the context of the wider picture provided by the authorities mentioned above, including the developments brought about by Directive 2019/790 on copyright in the Digital Single Market.133

NOTES 1. Related instruments Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society OJ L 167/10, 22.6.2001. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs OJ L 111/16, 5.5.2009.

2. CJEU case law Joined Cases C-403/08 and C-429/08, Football Association Premier League v QC Leisure, 4 October 2011, ECLI:EU:C:2011:631. Case C-5/08, Infopaq International A/S v Danske Dagblades Forening, 16 July 2009, EU:C:2009:465. Case C-302/10, Infopaq International A/S v Danske Dagblades Forening (Infopaq II), 17 January 2012, ECLI:EU:C:2012:16.

ARTICLE 8: APPLICATION IN TIME 1. 2.

131

132

133

This Directive shall apply in respect of all works and phonograms referred to in Article 1 which are protected by the Member States’ legislation in the field of copyright on or after 29 October 2014. This Directive shall apply without prejudice to any acts concluded and rights acquired before 29 October 2014.

See for example, Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs OJ L 111/16, Art. 8, which expressly provides that any contractual provisions contrary to the exceptions within that Directive shall be null and void. Further light on the interpretation of this provision in the context of the acquis could come, inter alia, from Case C-5/08, Infopaq International A/S v Danske Dagblades Forening, 16 July 2009, EU:C:2009:465; Case C-302/10, Infopaq International A/S v Danske Dagblades Forening (Infopaq II), 17 January 2012, ECLI:EU:C:2012:16; and Joined Cases C-403/08 and C-429/08, Football Association Premier League v QC Leisure, 4 October 2011, ECLI:EU:C:2011:631. See Chapter 17 of this volume.

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Chapter 13 THE ORPHAN WORKS DIRECTIVE

I. COMMENTARY 13.78 The Directive only takes effect in respect of all works and phonograms which are still in copyright on or after 29 October 2014; this can be a thorny issue as the subsistence, authorship and ownership of works across the EU still offer gaps and divergences (see discussion in relation to Art. 5). Article 8(2) states that the Directive is applicable to any acts or rights concluded or acquired before this date. This can be argued to mean that all licence agreements, including blanket licence agreements, concluded prior to this date between user organisations and collecting societies might be affected: institutional users may be able to avail themselves of the Directive’s safe harbours in relation to permitted uses, without renegotiating the existing contractual obligations, but this remains a risk management exercise.

ARTICLE 9: TRANSPOSITION 1.

Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 29 October 2014. They shall forthwith communicate to the Commission the text of those provisions. When Member States adopt those provisions, they shall contain a reference to this Directive or shall be accompanied by such a reference on the occasion of their official publication. The methods of making such reference shall be laid down by Member States. Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive.

2.

I. COMMENTARY 13.79 The Directive had to be implemented by 20 October 2014. As of 2020, all Member States have taken the necessary steps to implement its provisions. 13.80 There have been different national transpositions and solutions. Here are some examples: + The UK went beyond the scope of the Directive in terms of works (e.g., the UK legislation also caters for stand-alone artistic works which are not covered under the Directive) and uses covered, as well as introducing a licensing scheme for the reuse of orphan works for commercial purposes. The UK Government has announced that the orphan works exception will be revoked with effect from 1 January 2021. + The Netherlands has implemented the Directive by creating an extra copyright exception allowing cultural heritage institutions to digitise and display orphan works in their collections. The national authority the Cultural Heritage Agency (Rijksdienst voor het Cultureel Erfgoed) hosts the national Orphan Works Database + The Czech Republic has introduced mandatory provisions in implementing the Directive and has introduced extended collective management and a special licensing scheme for the use of orphan works. 13.81 The full implementation table with the necessary hyperlinks to the national provisions can be accessed at the European Commission’s site.134

134

https://eur-lex.europa.eu/legal-content/EN/NIM/?uri=CELEX:32012L0028.

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ARTICLE 10: REVIEW CLAUSE

ARTICLE 10: REVIEW CLAUSE The Commission shall keep under constant review the development of rights information sources and shall by 29 October 2015, and at annual intervals thereafter, submit a report concerning the possible inclusion in the scope of application of this Directive of publishers and of works or other protected subject-matter not currently included in its scope, and in particular stand-alone photographs and other images. By 29 October 2015, the Commission shall submit to the European Parliament, the Council and the European Economic and Social Committee a report on the application of this Directive, in the light of the development of digital libraries. When necessary, in particular to ensure the functioning of the internal market, the Commission shall submit proposals for amendment of this Directive. A Member State that has valid reasons to consider that the implementation of this Directive hinders one of the national arrangements concerning the management of rights referred to in Article 1(5) may bring the matter to the attention of the Commission together with all relevant evidence. The Commission shall take such evidence into account when drawing up the report referred to in the second paragraph of this Article and when assessing whether it is necessary to submit proposals for amendment of this Directive.

I. COMMENTARY As with the other harmonisation efforts in the field of copyright, the Directive attempts to establish 13.82 a level playing field for stakeholders in relation to different uses of orphan works. However, the impact of this piece of legislation will have to be assessed on a country-by-country basis. This is especially so in light of the principle of proportionality and the Directive’s expressed reluctance to dictate the national arrangements concerning collective management of rights. Another area of disparity is the scope of the subject matter to come within the exception under 13.83 national laws, especially in respect of stand-alone photographs and other images, which have generated much debate and controversy. The Directive is limited to print materials, and does not extend its coverage especially to artistic, dramatic or musical works, per se, unless embedded within print literature, phonograms or broadcasts (see Commentary to Art. 1). Moreover, while the Directive does not apply to other subject matter, it may be difficult for national collective management organisations to draw this fine distinction between printed subject matter and other subject matter, in which case, some Member States’ laws may mandate collecting societies to govern orphan works in respect of all protectable subject matter under copyright law. Member States who face difficulties with the implementation of the Directive, especially with respect to collective management issues, are allowed to notify the European Commission of such difficulties.135 13.84

In 2018, the Commission observed that: Pending the assessment of the Directive, the initial indications from Member States suggest that although the Orphan Works Directive has been transposed into national legislations and a number of Member States have put in place measures to monitor the impact of the Directive, it would seem that so far it has not

135

European Commission, Implementation of Commission Recommendation on the digitisation and online accessibility of cultural material and digital preservation – Progress report 2013–2015, Working document (June 2016), 9.

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Chapter 13 THE ORPHAN WORKS DIRECTIVE contributed to a large-scale digitisation of orphan works by cultural heritage institutions. The major practical and financial difficulty signalled so far seems to be linked to the due diligence search requirement.136

In November 2019, the European Commission launched a call for tenders in order to commission a study on the implementation and effect of the Directive.137

NOTES 1. Related instruments European Commission, Implementation of Commission Recommendation on the digitisation and online accessibility of cultural material and digital preservation – Progress report 2013–2015, Working document (June 2016). European Commission, Cultural Heritage: Digitisation, Online Accessibility and Digital Preservation – Consolidated Progress Report on the Implementation of Commission Recommendation (2011/711/EU) 2015–2017 (2018). European Commission, Call for tenders: Study on the application of the Orphan Work Directive (2012/28/EU) – SMART 2019/0042 (2019).

ARTICLE 11: ENTRY INTO FORCE This Directive shall enter into force on the day following that of its publication in the Official Journal of the European Union.

ARTICLE 12: ADDRESSEES This Directive is addressed to the Member States.

136 137

European Commission, Cultural Heritage: Digitisation, Online Accessibility and Digital Preservation – Consolidated Progress Report on the Implementation of Commission Recommendation (2011/711/EU) 2015–2017 (2018), 35. European Commission, Call for tenders: Study on the application of the Orphan Work Directive (2012/28/EU) – SMART 2019/0042 (2019).

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14 THE COLLECTIVE RIGHTS MANAGEMENT DIRECTIVE Lucie Guibault Updated by Sabine Jacques DIRECTIVE 2014/26/EU of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market [2013] ECR 1-000

INTRODUCTION

14.01

TITLE I: GENERAL PROVISIONS ARTICLE 1: SUBJECT MATTER I.

I.

COMMENTARY

14.09

ARTICLE 2: SCOPE I.

COMMENTARY COMMENTARY

14.15

I.

ARTICLE 12: DEDUCTIONS ARTICLE 13: DISTRIBUTION OF THE AMOUNTS DUE TO RIGHTHOLDERS 14.23

COMMENTARY COMMENTARY

COMMENTARY

ARTICLE 14: RIGHTS MANAGED UNDER REPRESENTATION AGREEMENTS

14.38

COMMENTARY

14.46

14.28

ARTICLE 7: RIGHTS OF RIGHTHOLDERS WHO ARE NOT MEMBERS OF THE COLLECTIVE MANAGEMENT ORGANISATION I.

COMMENTARY

CHAPTER 3: MANAGEMENT OF RIGHTS ON BEHALF OF OTHER COLLECTIVE MANAGEMENT ORGANISATIONS

ARTICLE 6: MEMBERSHIP RULES OF COLLECTIVE MANAGEMENT ORGANISATIONS I.

I.

14.24

ARTICLE 5: RIGHTS OF RIGHTHOLDERS I.

14.44

ARTICLE 11: COLLECTION AND USE OF RIGHTS REVENUE

ARTICLE 4: GENERAL PRINCIPLES I.

COMMENTARY

CHAPTER 2: MANAGEMENT OF RIGHTS REVENUE

CHAPTER 1: REPRESENTATION OF RIGHTHOLDERS AND MEMBERSHIP AND ORGANISATION OF COLLECTIVE MANAGEMENT ORGANISATIONS COMMENTARY

14.41

ARTICLE 10: OBLIGATIONS OF THE PERSONS WHO EFFECTIVELY MANAGE THE BUSINESS OF THE COLLECTIVE MANAGEMENT ORGANISATION

TITLE II: COLLECTIVE MANAGEMENT ORGANISATIONS

I.

COMMENTARY

ARTICLE 9: SUPERVISORY FUNCTION

14.13

ARTICLE 3: DEFINITIONS I.

ARTICLE 8: GENERAL ASSEMBLY OF MEMBERS OF THE COLLECTIVE MANAGEMENT ORGANISATION

ARTICLE 15: DEDUCTIONS AND PAYMENTS IN REPRESENTATION AGREEMENTS I.

COMMENTARY

14.51

CHAPTER 4: RELATIONS WITH USERS ARTICLE 16: LICENSING 14.40

I.

COMMENTARY

14.54

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Chapter 14 THE COLLECTIVE RIGHTS MANAGEMENT DIRECTIVE ARTICLE 17: USERS’ OBLIGATIONS I.

COMMENTARY

14.60

I.

CHAPTER 5: TRANSPARENCY AND REPORTING

COMMENTARY

14.69

ARTICLE 32: DEROGATION FOR ONLINE MUSIC RIGHTS REQUIRED FOR RADIO AND TELEVISION PROGRAMMES

ARTICLE 18: INFORMATION PROVIDED TO RIGHTHOLDERS ON THE MANAGEMENT OF THEIR RIGHTS

I.

ARTICLE 19: INFORMATION PROVIDED TO OTHER COLLECTIVE MANAGEMENT ORGANISATIONS ON THE MANAGEMENT OF RIGHTS UNDER REPRESENTATION AGREEMENTS

14.72

ARTICLE 33: COMPLAINTS PROCEDURE ARTICLE 34: ALTERNATIVE DISPUTE RESOLUTION PROCEDURES ARTICLE 35: DISPUTE RESOLUTION I.

ARTICLE 21: DISCLOSURE OF INFORMATION TO THE PUBLIC

COMMENTARY

14.73

ARTICLE 36: COMPLIANCE ARTICLE 37: EXCHANGE OF INFORMATION BETWEEN COMPETENT AUTHORITIES

ARTICLE 22: ANNUAL TRANSPARENCY REPORT COMMENTARY

COMMENTARY

TITLE IV: ENFORCEMENT MEASURES

ARTICLE 20: INFORMATION PROVIDED TO RIGHTHOLDERS, OTHER COLLECTIVE MANAGEMENT ORGANISATIONS AND USERS ON REQUEST

I.

ARTICLE 31: ACCESS TO MULTI-TERRITORIAL LICENSING

14.61

I.

COMMENTARY

14.75

TITLE III: MULTI-TERRITORIAL LICENSING OF ON-LINE RIGHTS IN MUSICAL WORKS BY COLLECTIVE MANAGEMENT ORGANISATIONS

ARTICLE 38: COOPERATION FOR THE DEVELOPMENT OF MULTI-TERRITORIAL LICENSING

ARTICLE 23: MULTI-TERRITORIAL LICENSING IN THE INTERNAL MARKET

TITLE V: REPORTING AND FINAL PROVISIONS

I.

COMMENTARY

14.64

ARTICLE 39: NOTIFICATION OF COLLECTIVE MANAGEMENT ORGANISATIONS

ARTICLE 24: CAPACITY TO PROCESS MULTI-TERRITORIAL LICENCES

I.

ARTICLE 25: TRANSPARENCY OF MULTITERRITORIAL REPERTOIRE INFORMATION

ARTICLE 41: EXPERT GROUP

COMMENTARY

14.79

ARTICLE 40: REPORT

ARTICLE 26: ACCURACY OF MULTI-TERRITORIAL REPERTOIRE INFORMATION

I.

ARTICLE 27: ACCURATE AND TIMELY REPORTING AND INVOICING

I.

ARTICLE 28: ACCURATE AND TIMELY PAYMENT TO RIGHTHOLDERS

ARTICLE 44: ENTRY INTO FORCE

I.

COMMENTARY

COMMENTARY

14.80

ARTICLE 42: PROTECTION OF PERSONAL DATA COMMENTARY

14.82

ARTICLE 43: TRANSPOSITION

14.67

ARTICLE 29: AGREEMENTS BETWEEN COLLECTIVE MANAGEMENT ORGANISATIONS FOR MULTI-TERRITORIAL LICENSING

ARTICLE 45: ADDRESSEES I.

COMMENTARY

14.83

ARTICLE 30: OBLIGATION TO REPRESENT ANOTHER COLLECTIVE MANAGEMENT ORGANISATION FOR MULTI-TERRITORIAL LICENSING

INTRODUCTION 14.01 Collective management organisations play an essential role in enabling the mass dissemination of content that is protected by copyright and related rights within Europe and beyond, especially when such dissemination takes place over the internet. Whether it is through commercial content delivery

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INTRODUCTION

services, through cultural heritage institutions in pursuit of their public mission,1 or through any other type of legitimate service, works are nowadays typically made accessible beyond the boundaries of a single territory. The need for multi-territorial licensing that spans the entire European territory is more acute than ever. The absence of EU-wide copyright licences has been one factor that has made it difficult for new internet-based music services to develop their full potential. Rights clearance for the exploitation of non-domestic repertoire must therefore be facilitated as much as possible. Since a significant portion of royalty collections in collective management organisations derives from the non-domestic repertoire, the facilitation of multi-territorial licensing of online music rights goes hand in hand with the establishment of a coherent system of collective rights management as a whole. The role and functioning of collective management organisations in the exploitation of copyright protected works in Europe therefore stands under the close scrutiny of European lawmakers and stakeholders with a view to developing solutions for the licensing of the aggregate repertoire of works administered by all European societies. The creation at the European level of a level playing field for collective management organisations 14.02 has been for a long time an item on the European Commission’s agenda, at least since the publication of the Green Paper of 1995 on Copyright and Related Rights in the Information Society. However, the acquis communautaire regulating the activities of collective management organisations remains rather sparse. Until recently, the core of the acquis was composed of a few references in different Directives2 and the decisions rendered by the Court of Justice of the European Union (CJEU) and the European Commission on the basis of the European rules on competition.3 Recital 17 of the Information Society Directive did emphasise the necessity, ‘especially in the light of the requirements arising out of the digital environment, to ensure that collecting societies achieve a higher level of rationalisation and transparency with regard to compliance with competition rules’. Even more recently, Article 12 of the new copyright Directive specifies that collective licensing plays a role in striking a balance between creators’ and users’ interests.4 Following this self-exhortation to action, the European Commission adopted Recommendation 14.03 2005/737/EC of 18 May 2005 on collective cross-border management of copyright and related rights for legitimate online music services5 which set out a number of principles, including the freedom of rightholders to choose their collective management organisation, the equal treatment of categories of rightholders and the equitable distribution of royalties. It also called on collective management organisations to provide users with sufficient information on tariffs and repertoire in advance of the negotiations. Finally, it contained recommendations on accountability, rightholder representation in the decision-making bodies of collective management organisations and dispute resolution. Since the Recommendation was a non-binding instrument addressed to both Member States and online service providers, it is not surprising to note that the norms it contained have not 1 2

3

4 5

Directive 2012/28/EC on certain permitted uses of orphan works. Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, Recitals 28, 29, 34 and Arts 1(4), 3(2), 9, and 13 which states, ‘This Directive shall be without prejudice to the regulation of the activities of collecting societies by the Member States’; Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property, Recital 12, and Art. 5(3); Directive 2001/29/EC on copyright and related rights in the information society, Recitals 17, 18, and 26; and Directive 2012/28/EU on certain permitted uses of orphan works, Recitals 4, 24 and Annex. M.M. Frabboni, ‘Collective management of copyright and related rights: Achievements and problems of institutional efforts towards harmonisation’, in E. Derclaye (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar, Cheltenham, UK and Northampton, MA, USA, 2009, 374. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC (Text with EEA relevance.) Commission Recommendation 2005/737/EC on Collective Cross-Border Management of Copyright and Related Rights for Legitimate Online Music Services, OJ L 276/54, 21.10.2005.

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Chapter 14 THE COLLECTIVE RIGHTS MANAGEMENT DIRECTIVE

been formally implemented in national legislation. The Recommendation, together with the decision of the European Commission in the CISAC case, have rather put the European market for the collective management of rights in turmoil, especially since stakeholders could not fall back on any harmonised rules on good governance of collective management organisations. 14.04 Ten years later, the Commission notes that significant differences still exist in the national rules governing the functioning of collective management organisations. This is particularly so as regards their transparency and accountability to their members and rightholders. The Commission further points out that beyond the difficulties faced by non-domestic rightholders when they seek to exercise their rights and the poor financial management of the revenues collected, problems with the functioning of collective management organisations lead to inefficiencies in the exploitation of copyright and related rights across the internal market to the detriment of the members of collective management organisations, rightholders and users alike. 14.05 The Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market6 aims, on the one hand, to establish rules on transparency, accountability and good governance for the collective management of copyright and related rights, and, on the other hand, to create a legal framework which promotes the development, in the field of music-making, of multi-territory and multi-directory licensing by collective management organisations. It is a ‘minimum harmonisation’ legal instrument; Member States may impose stricter and/or more detailed requirements on collective management organisations than those foreseen in the Directive. The proposal was transmitted to the European Parliament on 11 July 2012 and was subsequently referred to the Parliamentary Committee on Legal Affairs and others, for examination and advice. The European Parliament accepted the Proposal in first reading on 9 July 2013 and on 26 November 2013 the Legal Affairs committee of the European Parliament approved the compromise text of the proposal for a Directive. Numerous amendments were brought to the text of the Directive to make the measures envisaged better balanced and effective for all stakeholders involved. The text was adopted by 640 votes to 18, with 22 abstentions by the EU Parliament. The final Act was signed on February 26, 2014 and the Directive was published in the Official Journal on March 20, 2014. 14.06 According to the preamble of the Directive, the EU’s competence to legislate in matters concerning collective management of copyright and related rights rests on Articles 50(2)(g), 53 and 62 of the Treaty on the Functioning of the European Union (TFEU). Article 50(2)(g) TFEU calls upon the institutions of the EU to ‘coordinate to the necessary extent the safeguards which, for the protection of the interests of members and others, are required by Member States of companies or firms […] with a view to making such safeguards equivalent throughout the Union’. Recital 7 of the Directive specifies that the protection of the interests of the members of collective management organisations, rightholders and third parties requires that the laws of the Member States relating to copyright management and multi-territorial licensing of online rights in musical works should be coordinated with a view to having equivalent safeguards throughout the Union. Recital 8 goes on to state that the ‘the aim of this Directive is to provide for coordination of national rules concerning access to the activity of managing copyright and related rights by collective management organisations, the modalities for their governance, and their supervisory framework’. For this reason the Directive is

6

Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market Text with EEA relevance OJ L 84, 20.3.2014, 72–98.

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INTRODUCTION

based on Article 53(1) TFEU,7 as well as on Article 62 TFEU,8 since this is a sector offering services across the Union. Noteworthy is the express reference in Recital 3 of the Directive to Article 167 TFEU on the obligation of the Union ‘to take cultural diversity into account […] and to contribute to the flowering of the cultures of the Member States, while respecting their national and regional diversity and at the same time bringing the common cultural heritage to the fore’. The same Recital goes on to specify that ‘collective management organisations play, and should continue to play, an important role as promoters of the diversity of cultural expression, both by enabling the smallest and less popular repertoires to access the market and by providing social, cultural and educational services for the benefit of their rightholders and the public.’ This Recital on the role of collective management organisations in the promotion of cultural diversity, more particularly of the smaller organisations, reiterates a view that had been uttered several times in various policy documents, most notably in resolutions of the European Parliament. Of course, the European lawmaker is competent to adopt secondary legislation only if the proposed 14.07 measure complies with the principles of conferral, subsidiarity and proportionality.9 Within eight weeks from the date of transmission of the Proposal, however, four Member States had availed themselves of the possibility to issue a reasoned opinion stating why they considered that the draft in question did not comply with the principle of subsidiarity. These were Poland, Sweden, France, and Luxembourg.10 Article 5 of the Treaty on European Union states that, under the principle of subsidiarity, ‘the Union shall act only if and in so far as the objectives of the proposed action cannot be sufficiently achieved by the Member States, but can rather, by reason of the scale or effects of the proposed action, be better achieved at Union level’. The four Member States essentially argued that on the basis of this provision consideration should not only be given to the question whether the objective of the proposed action can be better achieved at Community level, but also whether the intensity of the action undertaken does not go beyond what is necessary to achieve the objective pursued. The European Economic and Social Committee (EESC) of the European Parliament responded to this objection by saying that the proposal: sets out ‘minimum’ provisions, which leave Member States significant leeway for transposition, to allow them to respond to the expectations of authors and creators and to promote culture and its dissemination to

7

TFEU, Art. 53(1) reads as follows: In order to make it easier for persons to take up and pursue activities as self-employed persons, the European Parliament and the Council shall, acting in accordance with the ordinary legislative procedure, issue directives for the mutual recognition of diplomas, certificates and other evidence of formal qualifications and for the coordination of the provisions laid down by law, regulation or administrative action in Member States concerning the taking-up and pursuit of activities as self-employed persons.

8 9

TFEU, Art. 62 reads as follows: ‘The provisions of Articles 51 to 54 shall apply to the matters covered by this Chapter.’ Proposed Directive, Recital 55: Since the objectives of this Directive, namely to improve the ability of their members to exercise control over the activities of collective management organisations, to guarantee sufficient transparency by collective management organisations and to improve the multi-territorial licensing of authors’ rights in musical works for online use, cannot be sufficiently achieved by Member States but can rather, by reason of their scale and effects, be better achieved at Union level, the Union may adopt measures in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Directive does not go beyond what is necessary in order to achieve those objectives.

10

European Parliament, Legal Affairs Committee, Notice to Members (90/2012) PE 498.070 v01-00 24 October 2012 (Poland); European Parliament, Legal Affairs Committee, Notice to Members (92/2012) PE 498.125 v01-00, 26 October 2012 (Sweden); European Parliament, Legal Affairs Committee, Notice to Members (93/2012), PE 498.161 v01-00, 31 October 2012 (France); European Parliament, Legal Affairs Committee, Notice to Members (94/2012), PE 500.410 v01–00, 7 November 2012 (Luxembourg).

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Chapter 14 THE COLLECTIVE RIGHTS MANAGEMENT DIRECTIVE the best of their ability. As a result, the EESC cannot share the views of certain legislative assemblies that the draft directive does not respect subsidiarity because it is overly prescriptive and detailed.11

The objection filed by the four Member States did not lead to any concrete action other than a tight negotiation in the European Parliament towards the improvement of the text so that it would comply with the principles of the EC Treaty. Indeed, major amendments have been brought to the text of the Directive between its initial introduction and the compromise text, which reflect a serious effort to establish a balanced and effective framework around the collective management of copyright and related rights. 14.08 This Directive differs from all previous legislative instruments in that it is indeed much more detailed, concrete and extensive than any other Directive adopted so far in the field of copyright and related rights. The Directive comprises more than 58 Recitals and 45 Articles, plus one Annex. Moreover, half of the measures contained in the Directive were new norms to be introduced in the European legal order: although some of the rules on governance and transparency codify rules deriving from the case law of the CJEU or the European Commission, most rules are new, just like those on multi-territorial licensing of online music services. In many instances, little background information is available on the specific rules contained in the Directive. For this reason, not all provisions are the object of comment in the pages below, least so where neither the Explanatory Memorandum to the Proposal or the Impact Assessment report offers support and where the subject covered has given rise through the years to no specific discussion in policy documents or legal literature.

NOTES 1. Related instruments Draft opinion of the Committee on the Internal Market and Consumer Protection for the Committee on Legal Affairs on the proposal for a directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market (COM(2012)0372 – C7–0183/2012 – 2012/0180(COD)) 26.3.2013. Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044/104, 15.02.2013. Working Document on the proposal for a directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market (COM(2012)0372 – C7–0183/2012 – 2012/0180(COD)), 28.2.2013. Commission Staff Working Document Impact Assessment Accompanying the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online uses in the internal market, Brussels, 11.7.2012 SWD(2012) 204 final. Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works, OJ L 299/5, 27.10.2012. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC (Text with EEA relevance) OJ L 130, 17.5.2019, 92–125. European Parliament resolution of 25 September 2008 on collective cross-border management of copyright and related rights for legitimate online music services, P6_TA(2008)0462, OJ C 8E, 105.

11

Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final, 2012/0180 (COD), O J C 044 , 15.02.2013, 104–8, para. 4.5.

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ARTICLE 1: SUBJECT MATTER European Parliament resolution of 13 March 2007 on the Commission Recommendation of 18 October 2005 on collective cross-border management of copyright and related rights for legitimate online music services (2005/737/ EC) (2006/2008(INI)), P6_TA(2007)0064, OJ C 301 E, 64. Directive on Rental Right and Lending Right and on Certain Rights Related to Copyright in the Field of Intellectual Property, OJ L 376/28, 27.12.2006. Commission Recommendation 2005/737/EC on Collective Cross-Border Management of Copyright and Related Rights for Legitimate Online Music Services, OJ L 276/54 of 21.10.2005. European Commission, Commission Staff Working Document – Study on a Community Initiative on the Cross-Border Collective Management of Copyright, Brussels, 7 July 2005. European Commission, Communication from the President in agreement with Vice-President Wallström – Commission Work Programme for 2005, COM (2005) 15 final, Brussels, 26.1. 2005. European Commission, Communication from the Commission to the Council, the European Parliament and the European Economic and Social Committee – The Management of Copyright and Related Rights in the Internal Market, COM (2004) 261 final, Brussels, 16.4.2004. European Parliament, Resolution on a Community framework for collective management societies in the field of copyright and neighbouring rights (2002/2274(INI)), P5_TA (2004)0036, Strasbourg, 15.1.2004. Directive 2001/29/EC of 22 May 2001 on the Harmonization of Copyright and Related Rights in the Information Society, OJ L 167/10, 22.6.2001. European Commission, Green Paper on Copyright and Related Rights in the Information Society, COM (95) 382 final, Brussels, 19.7.1995. Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, OJ L 248/15, 6.10.1993.

2. CJEU case law Commission Decision of 16 July 2008 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case COMP/C2/38.698 – CISAC), C (2008) 3435 final, Brussels, 16 Jul. 2008, [2009] 4 CMLR 12. Commission Decision 2003/300/EC of 8 October 2002 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case No COMP/C2/38.014 – ‘IFPI Simulcasting’), OJ L 107/58 of 30.4. 2003.

3. Bibliography Frabboni, M.M. ‘Collective management of copyright and related rights: Achievements and problems of institutional efforts towards harmonisation’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar, Cheltenham, UK and Northampton MA, USA, 2009. Guibault, L. and S. van Gompel, ‘Collective management in the European Union’, in Gervais, D. (ed.), Collective Management of Copyright and Related Rights, 2nd ed., Kluwer Law International, The Hague, 2010. Max Planck Institute for Intellectual Property and Competition Law, Comments on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, Munich, 2012. Quintais, J.P., ‘Proposal for a Directive on collective rights management and (some) multi-territorial licensing’ (2013) European Intellectual Property Review, 2, 65–73. Stamatoudi, I. (ed.), ‘Collective management of copyright and related rights’ (in Greek), Nomiki Vivliothiki, Athens, 2020. van Eechoud, M.M.M., P.B. Hugenholtz, S. van Gompel, L. Guibault and N. Helberger, Harmonizing European Copyright Law – The Challenges of Better Lawmaking, Kluwer Law International, Alphen aan den Rijn, 2009.

TITLE I: GENERAL PROVISIONS ARTICLE 1: SUBJECT MATTER This Directive lays down requirements necessary to ensure the proper functioning of the management of copyright and related rights by collective management organisations. It also lays

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down requirements for multi-territorial licensing by collective management organisations of online rights in musical works.

I. COMMENTARY 14.09 Articles 1 and 2 of the Directive are meant to clearly delineate the purpose and scope of application of the Directive. Obviously, the Directive deals with the two issues of good governance and transparency of collective management organisations on the one hand, and the multi-territorial licensing of rights in musical works for online use on the other (Art. 1). The focus of the rules on multi-territorial licensing on rights in musical works rather than in any other category of works, like books, videos, or games, is explained in the Impact Assessment report by the fact that contrary to other types of works, the value for users lies in obtaining coverage for the entire repertoire. The costs of clearing rights for the online use of musical works remain relatively high for the majority of users, whereas there is no indication that a spontaneous, market-driven solution will emerge.12 14.10 The final text of the Directive contains several new Recitals, compared to the initial Proposal, that are meant to further specify the subject matter of the Directive, but more importantly to circumscribe and clarify the leeway given to Member States in implementing it. Recital 9 reinforces Article 1 by stating that while the aim of the Directive is to lay down requirements applicable to collective management organisations, in order to ensure a high standard of governance, financial management, transparency and reporting, it ‘should not, however, prevent Member States from maintaining or imposing, in relation to collective management organisations established in their territories, more stringent standards than those laid down in Title II of this Directive, provided that such more stringent standards are compatible with Union law’. Recital 10 further specifies that ‘nothing in this Directive should preclude a Member State from applying the same or similar provisions to collective management organisations which are established outside the Union but which operate in that Member State’. This was indeed a useful addition for, especially in the online environment where collective management organisations engage in cross-border activities, offering management services to non-domestic rights owners and licensing services to foreign users, as expressly authorised under the Services Directive.13 14.11 In the aftermath of the CISAC case before the Court of Justice of the European Union, Recital 11 clearly states that ‘nothing in this Directive should preclude collective management organisations from concluding representation agreements with other collective management organisations – in compliance with the competition rules laid down by Articles 101 and 102 TFEU – in the area of rights management in order to facilitate, improve and simplify the procedures for granting licences to users, including for the purposes of single invoicing, under equal, non-discriminatory and transparent conditions, and to offer multi-territorial licences also in areas other than those referred to in Title III of this Directive’. 14.12 Recital 12 clarifies that the Directive ‘does not interfere with arrangements concerning the management of rights in the Member States such as individual management, the extended effect of an agreement between a representative collective management organisation and a user, i.e. extended collective licensing, mandatory collective management, legal presumptions of representation and transfer of rights to collective management organisations.’ Finally, Recital 13 points out that the Directive leaves the possibility unaffected ‘for Member States to determine by law, by regulation or

12 13

Impact assessment, 24. Directive 2006/123/EC of the European Parliament and the Council of 12 December 2006 on services in the Internal Market, OJ 27.12.2006, L 376/36. See: Thomas Riis, ‘Collecting societies, competition, and the Services Directive’, (2011) Journal of Intellectual Property Law and Practice, 6, 482–93.

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ARTICLE 2: SCOPE

by any other specific mechanism to that effect, rightholders’ fair compensation for exceptions or limitations to the reproduction right provided for in Directive 2001/29/EC of the European Parliament and of the Council14 and rightholders’ remuneration for derogations from the exclusive right in respect of public lending provided for in Directive 2006/115/EC of the European Parliament and of the Council15 applicable in their territory as well as the conditions applicable for their collection’.

ARTICLE 2: SCOPE 1. 2. 3.

4.

Titles I, II, IV and V with the exception of Articles 34(2) and Article 38 apply to all collective management organisations established in the Union. Title III and Articles 34(2) and Article 38 apply to collective management organisations established in the Union managing authors’ rights in musical works for online use on a multi-territorial basis. The relevant provisions of this Directive apply to entities directly or indirectly owned or controlled, wholly or in part, by a collective management organisation, provided that such entities carry out an activity which, if carried out by the collective management organisation, would be subject to the provisions of this Directive. Article 16(1), Articles 18 and 20, points (a), (b), (c), (d), (e), (f) and (g) of Article 21(1) and Articles 36 and 42 apply to all independent management entities established in the Union.

I. COMMENTARY Article 2 specifies that Title I (e.g. Arts 1–3), which sets out the general provisions, Title II (e.g. 14.13 Arts 4–22), which contains organisational and transparency rules, and Title IV (e.g. Arts 33–38, with the exception of Art. 36), which deals with enforcement measures, apply to all types of collective management organisations, irrespective of the sector in which the societies are active. Articles 23–32 included in Title III, as well as Article 36 of Title IV, which lay down rules pertaining to multi-territorial licensing, only apply to collective management organisations that grant multi-territorial licences in online rights in musical works. Article 2 was amended between the initial proposal and the final text of the Directive, through the 14.14 introduction of a third and fourth paragraph dealing in essence with what the Directive calls ‘independent management entities’. ‘Independent management entities’ represent a new concept in the European copyright acquis. In addition to the definition listed in Article 3 (see below), the legislator devotes a series of Recitals to the explanation of the concept, putting it into context and giving additional background information. Accordingly, Recital 14 clarifies that: the Directive does not require collective management organisations to adopt a specific legal form. In practice, those organisations operate in various legal forms such as associations, cooperatives or limited liability companies, which are controlled or owned by holders of copyright and related rights or by entities representing such rightholders. In some exceptional cases, however, due to the legal form of a collective management organisation, the element of ownership or control is not present. This is, for example, the case for foundations, which do not have members. Nonetheless, the provisions of this Directive should also apply to those organisations. Similarly, Member States should take appropriate measures to prevent the

14 15

Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society (OJ L 167, 22.6.2001, 10). Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (OJ L 376, 27.12.2006, 28).

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Chapter 14 THE COLLECTIVE RIGHTS MANAGEMENT DIRECTIVE circumvention of the obligations under this Directive through the choice of legal form. It should be noted that entities which represent rightholders, and which are members of collective management organisations may be other collective management organisations, associations of rightholders, unions or other organisations.

For more certainty, Recital 15 emphasises that rights owners should be free to entrust the management of their rights to independent management entities, understood as ‘commercial entities which differ from collective management organisations inter alia because they are not owned or controlled by rightholders’. Recital 16 illustrates the boundaries of this new concept by specifying that audiovisual producers, record producers, broadcasters and publishers who license their own rights, in certain cases alongside rights that have been transferred to them, are not to be construed as ‘independent management entities’ because they do not manage rights in the sense of setting tariffs, granting licences or collecting money from users. Had ‘independent management entities’ remained outside the scope of the Directive, this would have meant that in certain Member States a (potentially important) number of management entities would have escaped the obligations of transparency and accountability laid down herein leaving rights owners with little recourse in case of sub-optimal performance.

NOTES 1. Related instruments Commission Staff Working Document Impact Assessment Accompanying the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online uses in the internal market, Brussels, 11.7.2012 SWD(2012) 204 final.

2. Bibliography Riis, T., ‘Collecting societies, competition, and the Services Directive’, (2011) Journal of Intellectual Property Law and Practice, 6, 482–93.

ARTICLE 3: DEFINITIONS For the purposes of this Directive, the following definitions shall apply: (a)

(b)

“collective management organisation” means any organisation which is authorised by law or by way of assignment, licence or any other contractual arrangement to manage copyright or rights related to copyright on behalf of more than one rightholder, for the collective benefit of those rightholders, as its sole or main purpose, and which fulfils one or both of the following criteria: (i) it is owned or controlled by its members; (ii) it is organised on a not-for-profit basis; “independent management entity” means any organisation which is authorised by law or by way of assignment, licence or any other contractual arrangement to manage copyright or rights related to copyright on behalf of more than one rightholder, for the collective benefit of those rightholders, as its sole or main purpose, and which is: (i) neither owned nor controlled, directly or indirectly, wholly or in part, by rightholders, and (ii) organised on a for-profit basis;

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ARTICLE 3: DEFINITIONS

(c) (d) (e) (f) (g)

(h) (i) (j)

(k) (l) (m) (n)

“rightholder” means any person or entity other than a collective management organisation that holds a copyright or related right or, under an agreement for the exploitation of rights or by law, is entitled to a share of the rights revenue; “member” means a rightholder or an entity representing rightholders, including other collective management organisations and associations of rightholders, fulfilling the membership requirements of the collective management organisation and admitted by it; “statute” means the memorandum and articles of association, the statute, the rules or documents of constitution of a collective management organisation; “general assembly of members” means the body in the collective management organisation wherein members participate and exercise their voting rights, regardless of the legal form of the organisation; “director” means: (i) where national law or the statute of the collective management organisation provides for a unitary board, any member of the administrative board; (ii) where national law or the statute of the collective management organisation provides for a dual board, any member of the management board or the supervisory board; “rights revenue” means income collected by a collective management organisation on behalf of rightholders, whether deriving from an exclusive right, a right to remuneration or a right to compensation; “management fees” means the amount charged, deducted or offset by a collective management organisation from rights revenue or from any income arising from the investment of rights revenue in order to cover the costs of its management of copyright or related rights; “representation agreement” means any agreement between collective management organisations whereby one collective management organisation mandates another collective management organisation to manage the rights of the rightholders it represents, including an agreement concluded under Articles 29 and 30; “user” means any person or entity that is carrying out acts subject to the authorisation of rightholders, remuneration of rightholders or payment of compensation to rightholders and who is not acting in the capacity of a consumer; “repertoire” means the works in respect of which a collective management organisation manages rights; “multi-territorial licence” means a licence which covers the territory of more than one Member State; “online rights in musical works” means any of the rights of an author in a musical work provided for under Articles 2 and 3 of Directive 2001/29/EC which are required for the provision of an online music service.

I. COMMENTARY Compared to any other Directive in the field of copyright and related rights law, Article 3 of this 14.15 Directive sets out the longest list of definitions. Some of the terms defined here have been defined previously, either in the Satellite and Cable Directive or in the Recommendation of 2005. But, as shown below, the definitions contained in this Directive show certain differences with the other instruments. In practice, the scope of application of a specific piece of legislation hinges to a large extent on the way in which the terms are defined therein. Some definitions contained in Article 3 of the Directive have undergone important amendments in the course of the legislative process, not the least among these is the concept of collective management organisation. The initial Proposal contained a definition of ‘collecting society’, on which depended the appli- 14.16 cation of all other provisions of the Directive. ‘Collecting society’ is an existing concept in the acquis, defined in Article 1(4) of the Satellite and Cable Directive, as ‘any organisation which manages or

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administers copyright or rights related to copyright as its sole purpose or as one of its main purposes’. But the Proposal differed from the Satellite and Cable Directive for it specified that a collecting society is one ‘which is authorised by law or by way of assignment, licence or any other contractual arrangement, by more than one right holder’. The Proposal also differed from the 2005 Recommendation, which defines ‘collective rights managers’ by referring to their activities rather than their structure.16 Any entity offering centralised management of rights of more than one rightholder and operating under a membership structure would in principle have qualified as a collecting society under the Proposal. Independent rights management service providers who act as agents for rightholders for the management of their rights on a commercial basis and in which rightholders do not exercise membership rights, would have been excluded from the definition on the ground that the problems addressed in the Proposal did not arise due to the absence of a membership structure. 14.17 This exclusion gave rise to a plethora of criticisms among which were the comments from the Max Planck Institute and from the European Parliament’s Committee on Legal Affairs,17 the latter calling for a modification of the definition of ‘collecting society’ so as to ensure that ‘all branches meet the same standards’, including commercial companies or agents who are engaged in similar rights management activities. By applying a narrow definition of ‘collecting society’, one which required ownership or control of the society by its members, the Proposal would have ‘excluded other forms of organisations, such as corporations with shareholders, who are not rightholders themselves, from the scope of application of the Directive’.18 This would have held the risk of circumvention: in an effort to avoid the application of the rules of the Directive, an organisation could switch from a membership structure to another structure, to the detriment of the rightholders. As a result of the criticism, the final text of the Directive now centres on the two notions of ‘collective management organisation’ and ‘independent management entity ’, the main difference between the two lying in the ownership or control structure of each type of organisation. Both now expressly fall under the scope of application of the Directive. 14.18 ‘Rightholder’ must be defined in broad enough terms so as to encompass all categories of members whose rights are managed by any type of collective management organisation, including not only natural persons and legal entities holding a copyright or related right, but also publishers who by virtue of an agreement for the exploitation of rights or by law are entitled to a share of the revenue from the rights managed by collective management organisations and to collect such income from the collective management organisation. Recital 20 of the Directive specifies that membership of collective management organisations should be based on objective, transparent and nondiscriminatory criteria. Regarding publishers, mentioned in the Directive but not in the Recommendation of 2005, Recital 20 reflects industry practice, according to which authors and performers often transfer their rights to a publisher in exchange for his or her commitment to commercially exploit the work or other subject matter. According to such a contractual arrangement, publishers become entitled to a share of the revenue deriving from collective rights management.

16

Recommendation of 2005, Art. 1(e), which reads: ‘collective rights manager’ means any person providing the services set out in point (a) to several right-holders; art. 1(a) reads: ‘management of copyright and related rights for the provision of legitimate online music services at Community level’ means the provision of the following services: the grant of licences to commercial users, the auditing and monitoring of rights, the enforcement of copyright and related rights, the collection of royalties and the distribution of royalties to right-holders.

17

18

Working Document on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, COM(2012)0372 – C7–0183/2012 – 2012/0180(COD), Committee on Legal Affairs, Rapporteur: Marielle Gallo, 4 March 2013. Max Planck Institute for Intellectual Property and Competition Law, Comments on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, Munich, 2012, 20.

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In its comment on the Proposal, the Max Planck Institute had criticised the lack of distinction made 14.19 between different categories of rightholders, with the concern that original rightholders may be disadvantaged compared to subsequent rightholders, e.g. major publishing companies, in the later distribution of the revenues collected.19 This concern has, namely been addressed in the revised definition of ‘director’, which now takes into account the possibility that an organisation has a dual board of administration composed of different categories of members. Recital 22 recalls that ‘some collective management organisations have different categories of members, which may represent different types of rightholders, such as producers and performers. The representation in the decision-making process of those different categories of members should be fair and balanced’. Other substantive provisions of the Directive also reinforce the distinction between categories of rightholders, for example those dealing with the rights of members, and the participation in the general assembly. ‘User’, as defined under the Proposal, is ‘any natural person or legal entity who is carrying out acts 14.20 subject to the authorisation of rightholders, the remuneration of rightholders or the payment of compensation to rightholders and who is not acting in the capacity of a consumer’. This definition, which is also broader than that of the Recommendation of 2005, is designed to encompass all types of users of protected works or other subject matter, whether the use falls under a voluntary or non-voluntary licensing regime from the point of view of the rightholder. Of course, ‘consumer’ should be understood here in the same manner as normally recognised in the acquis communautaire, namely ‘any natural person who, in contracts covered by this Directive, is acting for purposes which are outside his trade, business, craft or profession’.20 ‘Rights revenue’ and ‘management fees’ are defined in accordance with the case law developed by the 14.21 EC and the CJEU.21 ‘Online rights in musical works’ are defined by reference to Articles 2 and 3 of Directive 2001/29/EC. 14.22 Article 2 of Directive 2001/29/EC relates to the right of reproduction, defined as ‘the exclusive right to authorise or prohibit direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part’. Article 3 of Directive 2001/29/EC generally concerns the right of communication to the public. When read in conjunction with the definition of ‘online music service’, it is clear that the online rights in musical works aim at interactive acts of communication over the internet; the right concerned is therefore the right of making available to the public, rather than the right of communication to the public. For all three categories of owners of online rights in musical works (authors, performers, phonogram producers), this right is understood as ‘the exclusive right to authorise or prohibit the making available to the public, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them’.

19 20

21

Max Planck Institute for Intellectual Property and Competition Law, 14. Directive 2011/83/EU of the European Parliament and of the Council of 25 October 2011 on consumer rights, amending Council Directive 93/13/EEC and Directive 1999/44/EC of the European Parliament and of the Council and repealing Council Directive 85/577/EEC and Directive 97/7/EC of the European Parliament and of the Council, OJ L 304/64 of 22.11.2011, Art. 2(1). Commission Decision of 8 October 2002 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case No COMP/C2/38.014 – IFPI ‘Simulcasting’), OJ L 107, 30.4.2003, 58–84; Commission Decision of 16 July 2008 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case COMP/C-2/38.698 – CISAC), OJ C 323, 18.12.2008, 12–13.

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NOTES 1. Related instruments Working Document on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, COM(2012)0372 – C7-0183/2012 – 2012/0180(COD), Committee on Legal Affairs, Rapporteur: Marielle Gallo, 4 March 2013. Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, OJ L 248/15, 06.10.1993. Commission Recommendation 2005/737 of October 18, 2005 on collective cross-border management of copyright and related rights for legitimate online music services, OJ L276/54 2005. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market, OJ L 178/1, 17.7.2000. Directive 98/34/EC of the European Parliament and of the Council of 22 June 1998 laying down a procedure for the provision of information in the field of technical standards and regulations, OJ L 204/37, 21.7.1998.

2. CJEU case law Commission Decision of 8 October 2002 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case No COMP/C2/38.014 – ‘IFPI Simulcasting’), OJ L 107/58, 30.4.2003. Commission Decision of 16 July 2008 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case COMP/C-2/38.698 – ‘CISAC’), OJ C 323/12, 18.12.2008.

3. Bibliography Quintais, J.P. ‘Proposal for a Directive on Collective Rights Management and (Some) Multi-Territorial Licensing’, (2013) EIPR, 2, 65–73. Max Planck Institute for Intellectual Property and Competition Law, Comments on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, Munich, 2012.

TITLE II: COLLECTIVE MANAGEMENT ORGANISATIONS CHAPTER 1 REPRESENTATION OF RIGHTHOLDERS AND MEMBERSHIP AND ORGANISATION OF COLLECTIVE MANAGEMENT ORGANISATIONS I. COMMENTARY 14.23 As mentioned previously, all Articles of Title II of the Directive are meant to apply to all types of collective management organisations, irrespective of their legal form or field of activity. According to the Explanatory Memorandum, the rules on the governance and transparency codify, to a large extent, existing case law of the CJEU in the context of decisions of the Commission taken in the area of competition law.22 Title II is divided into five chapters: (1) Chapter 1 (Arts 4–10) provides for rules governing the representation of rightholders and membership organisation of collective management organisations; Chapter 2 (Arts 11–13) concerns the management of rights revenue; Chapter 3 (Arts 14 and 15) establishes rules of management of rights on behalf of other collective 22

Case 395/87Ministère public v Jean-Louis Tournier [1989] ECRI-02521; Joined Cases 110/88, 241/88 and 242/88, François Lucazeau and others v Société des Auteurs, Compositeurs et Editeurs de Musique (SACEM) and others [1989] ECR I-02811.

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ARTICLE 4: GENERAL PRINCIPLES

management organisations; Chapter 4 (Arts 16–17) concerns relations with users; and Chapter 6 (Arts 18–22) lays down obligations on transparency and reporting.

NOTES 1. CJEU case law Ministère public v Jean-Louis Tournier (Case 395/87) [1989] ECR I-02521. François Lucazeau and others v Société des Auteurs, Compositeurs et Editeurs de Musique (SACEM) and others (Joined Cases 110/88, 241/88 and 242/88) [1989] ECR I-02811.

ARTICLE 4: GENERAL PRINCIPLES Member States shall ensure that collective management organisations act in the best interests of the rightholders whose rights they manage and that they do not impose on them any obligations which are not objectively necessary for the protection of their rights and interests or for the effective management of their rights.

I. COMMENTARY Recital 22 of the Directive gives some indication of what the lawmakers perceive as being in the best 14.24 collective interests of the rightholders they represent, e.g. to provide for systems, which enable members of collective management organisations to exercise their membership rights by participating in the societies’ decision-making process. The representation of the different categories of members in the decision-making process should be fair and balanced. According to the same Recital, the effectiveness of the rules on the general meeting of members of collective management organisations could be undermined if no provisions governed the conduct of the general assembly. Article 8 is therefore meant to ensure that the general assembly is convened regularly, and at least annually, and that the most important decisions in the collective management organisation are taken by the general assembly. Annex C of the impact assessment report further states that ‘the general principles applicable to the 14.25 activities of collecting societies take into account the need to protect the collecting interests of authors and publishers, the need to preserve the exclusive property rights of authors and their individual exercise, and the need to control the monopoly power of collecting societies’. The same Annex recalls that collecting societies entrusted with the exploitation of copyright ‘may not impose on their members obligations which are not absolutely necessary for the attainment of its object and which encroach unfairly upon a member’s freedom to exercise his copyright’.23 By contrast, Article 4 of the Recommendation of 2005 merely called upon ‘collective rights managers’ to apply the ‘utmost diligence in representing the interests of right-holders’. The obligation to act in the best interests of the members and to impose only those obligations that 14.26 are necessary for the protection of those interests flows from the case law of the EC and the CJEU. In the GEMA I case,24 the EC examined four points in the light of Article 102 TFEU (ex Art. 82 TEC): (1) the scope of the assignment of rights in favour of the collective management

23 24

Impact Assessment report, 64. Commission Decision 71/224/EEC of 2 June 1971 relating to a proceeding under Article 86 of the EEC Treaty (IV/26 760 – GEMA), OJ L 134/15 of 20.6.1971 [GEMA I decision].

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organisations, (2) the distribution of income, (3) the membership of non-domestic rightholders and (4) the member’s ability to have recourse to courts to decide on disputes with the collective management organisations. The obligation set by a collective management organisation requiring its members to assign unduly broad (categories of) rights was construed by the European Commission as a (potential) abuse of a dominant position. 14.27 The CJEU’s decision in the BRT v SABAM case confirmed this view.25 In the Court’s opinion, the decisive factor when examining the statutes of a collective management organisation in the light of the European competition rules, is whether the statutes exceed the limits absolutely necessary for effective protection (the ‘indispensability’ test) and whether they limit the individual copyright holder’s freedom to dispose of his work no more than necessary (the ‘equity’ test).26 In the SABAM case, the Court ruled that ‘a compulsory assignment of all copyrights, both present and future, no distinction being drawn between the different generally accepted types of exploitation, may appear an unfair condition, especially if such assignment is required for an extended period after the member’s withdrawal’.27

NOTES 1. Related instruments Commission Staff Working Document Impact Assessment Accompanying the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online uses in the internal market, Brussels, 11.7.2012 SWD(2012) 204 final. Communication from the Commission to the Council, the European Parliament and the European Economic and Social Committee, the Management of Copyrights and Neighbouring Rights in the Internal Market, Brussels, 16 April 2004 COM(2004) 261 final.

2. CJEU case law Commission Decision 71/224, GEMA I (Gesellschaft für musikalische Aufführungs- und mechanische Vervielfältigungsrechte), [1971] OJ L 134/15. Commission Decision 72/268, GEMA II (Gesellschaft für musikalische Aufführungs- und mechanische Vervielfältigungsrechte), [1972] OJ L 166/22. BRT v SABAM (Case 127/73) [1974] ECR 51. Greenwich Film Production v SACEM and Société des éditions Labrador (Case 22/79) [1979] ECR 3275. GVL v Commission (Case 7/82) [1983] ECR 483.

3. Bibliography Drexl, J. ‘Competition in the field of collective management: preferring “creative competition” to allocative efficiency in European copyright law’, in P.L.C. Torremans (ed.), Copyright Law: A Handbook of Contemporary Research, Edward Elgar, Cheltenham, UK and Northampton, MA, USA, 2007. Frabboni, M.M. ‘Collective management of copyright and related rights: Achievements and problems of institutional efforts towards harmonisation’, in E. Derclaye, (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar, Cheltenham, UK and Northampton, MA, USA, 2009. Mestmäcker, E.-J. ‘Collecting Societies’, in C.-D. Ehlermann and I. Atanasiu (eds), European Competition Law Annual 2005: The Interaction between Competition Law and Intellectual Property Law, Hart, Oxford/Portland, Oregon, 2005.

25 26 27

Case 127/73 Belgische Radio en Televisie (BRT) v SABAM [1974] ECR 51 and 313. Ibid., paras 8–11. Ibid., para. 12.

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ARTICLE 5: RIGHTS OF RIGHTHOLDERS

ARTICLE 5: RIGHTS OF RIGHTHOLDERS 1. 2.

3. 4.

5.

6.

7.

8.

Member States shall ensure that rightholders have the rights as laid down in paragraphs 2 to 8 and that those rights are set out in the statute or membership terms of the collective management organisation. Rightholders shall have the right to authorise a collective management organisation of their choice to manage the rights, categories of rights or types of works and other subjectmatter of their choice, for the territories of their choice, irrespective of the Member State of nationality, residence or establishment of either the collective management organisation or the rightholder. Unless the collective management organisation has objectively justified reasons to refuse management, it shall be obliged to manage such rights, categories of right or types of works and other subject-matter, provided that their management falls within the scope of its activity. Rightholders shall have the right to grant licences for non-commercial uses of any rights, categories of rights or types of works and other subject-matter that they may choose. Rightholders shall have the right to terminate the authorisation to manage rights, categories of rights or types of works and other subject-matter granted by them to a collective management organisation or to withdraw from a collective management organisation any of the rights, categories of rights or types of works and other subject-matter of their choice, as determined pursuant to paragraph 2, for the territories of their choice, upon serving reasonable notice not exceeding six months. The collective management organisation may decide that such termination or withdrawal is to take effect only at the end of the financial year. If there are amounts due to a rightholder for acts of exploitation which occurred before the termination of the authorisation or the withdrawal of rights took effect, or under a licence granted before such termination or withdrawal took effect, the rightholder shall retain his rights under Articles 11, 12, 16, 18, 26 and 34. A collective management organisation shall not restrict the exercise of rights provided for under paragraphs 3 and 4 by requiring, as a condition for the exercise of those rights, that the management of rights or categories of rights or type of works and other subject matter which are subject to the termination or the withdrawal be entrusted to another collective management organisation. In cases where a rightholder authorises a collective management organisation to manage his rights, he shall give consent specifically for each right or category of rights or type of works and other subject-matter which he authorises the collective management organisation to manage. Any such consent shall be evidenced in documentary form. A collective management organisation shall inform rightholders of their rights under paragraphs 1 to 7, as well as of any conditions attached to the right set out in paragraph 3, before obtaining their consent to its managing any right or category of rights or type of works and other subject-matter. A collective management organisation shall inform those rightholders who have already authorised it of their rights under paragraphs 1 to 7 as well as of any conditions attached to the right set out in paragraph 3, by Directive 2014/26, by 10 October 2016.

I. COMMENTARY With respect to the relationship between collective management organisations and rightholders, 14.28 Article 5 of the Directive lays down a number of key principles: (1) the right of rightholders to authorise the collective management organisation of their choice, throughout the European Union; (2) the choice to grant a collective management organisation the authorisation to manage certain categories of rights or certain types of works; and (3) the right to terminate the authorisation to

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manage or to withdraw any right, category of rights or types of works of their choice from a collective management organisation. Although the final text of the Directive no longer explicitly refers to Directive 2006/123/EC on services in the internal market, it is reasonable to think that services offered in the Member States should be in accordance with the principles of that Directive and be available irrespective of the Member State of residence or of establishment or the nationality of either the collective management organisation or the rightholder. This provision echoes the European Parliament’s recognition of the need to safeguard by legislation the freedom of creators to decide for themselves, which rights they wish to confer on collective management societies, and which rights they wish to manage individually.28 14.29 The principle of non-discrimination flows, of course, from Article 18 TFEU, as well as from the case law of the CJEU and the EC. Early on, in the GEMA I case, the EC stressed that collective management organisations may not discriminate among members as regards the distribution of income.29 The Commission held that GEMA had abused its dominant position by paying supplementary fees, from revenue collected from the membership as a whole, only to those members who had been ordinary members for at least three years. Also, the Commission ruled that collective management organisations may not refuse nationals of other EU Member States as members, nor impose discriminatory terms concerning their membership rights, e.g. by preventing a foreign rightholder becoming an ordinary or extraordinary member (a voting member).30 According to the Commission, such practices must automatically be regarded as an infringement of Article 102 TFEU, as they run counter to the principle of equal treatment resulting from the prohibition of ‘any discrimination on grounds of nationality’ in Article 18 TFEU. Moreover, the refusal to accept the membership of nationals of other Member States falls directly under the special prohibition of discrimination under Community competition law, as contained in Article 102(c) TFEU. In this respect, the ECJ confirmed, in the Phil Collins case,31 that domestic provisions containing reciprocity clauses cannot be relied upon in order to deny nationals of other EU Member States rights conferred on national authors. 14.30 The Directive’s recognition of the rightholder’s choice to confer on a collective management organisation the management of only certain (categories of) rights or certain works also derives from the case law of the CJEU and the EC. In the Daft Punk decision,32 the EC ruled that a collective management organisation may be abusing its dominant position where its statutes contain a mandatory requirement according to which all rights of an author must be assigned without distinction, given that such practice corresponds to the imposition of an unfair trading condition. In this case, the two Daft Punk members wished to individually manage their rights for exploitation on the internet, CD-ROM, DVD, etc. The French SACEM refused membership, arguing that it protected authors from unreasonable demands of the record industry and prevented a cherry picking of the most valuable rights. The Commission considered this refusal a disproportionate curtailment of individual management of the rights in question contrary to Article 102 TFEU. 14.31 Among the most important amendments brought to the text of the Directive are those of Article 5 and of the corresponding Recital 19, which clearly lay down the rightholders’ freedom of choice, regarding the collective management organisation that will manage their rights, the territories for which the management of rights are entrusted, the extent of the rights entrusted, whether those

28 29 30 31 32

European Parliament, Resolution on a Community framework for collective management societies in the field of copyright and neighbouring rights (2002/2274(INI)), P5_TA(2004)0036, Strasbourg, 15 January 2004, 5, para. 32. Case 71/224 GEMA I. Case 7/82, GVL v Commission [1983] ECR 483; and see Case 402/85, Basset v SACEM [1987] ECR I-1747, para. 11. ECJ judgment in Joined Cases C-92/92 and C-326/92, Phil Collins and Patricia Im- und Export Imtrat and EMI Electrola[1993] ECR I-5145. Commission Decision of 06.08.2002 in case COMP/C2/37.219 Banghalter/Homem Christo (Daft Punk) v SACEM.

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rights are rights of communication to the public or reproduction rights, or categories of rights related to forms of exploitation (such as broadcasting, theatrical exhibition or reproduction for online distribution). This freedom should be exercisable irrespective of the Member State of nationality, residence or establishment of either the collective management organisation or the rightholder. The sole condition set is that the collective management organisation that the rightholder wishes to appoint already manages such rights or categories of rights. Recital 19 points out that the rights, categories of rights or types of works and other subject matter 14.32 managed by the collective management organisation, should be determined by the general assembly of members of that organisation if they are not already determined in its statute or prescribed by law. The Recital stresses the importance of making such a determination in a manner that: maintains a balance between the freedom of rightholders to dispose of their works and other subject matter and the ability of the organisation to manage the rights effectively, taking into account in particular the category of rights managed by the organisation and the creative sector in which it operates. Taking due account of that balance, rightholders should be able easily to withdraw such rights or categories of rights from a collective management organisation and to manage those rights individually or to entrust or transfer the management of all or part of them to another collective management organisation or another entity, irrespective of the Member State of nationality, residence or establishment of the collective management organisation, the other entity or the rightholder.

However, it is also specified that ‘where a Member State, in compliance with Union law and the international obligations of the Union and its Member States, provides for mandatory collective management of rights, rightholders’ choice would be limited to other collective management organisations’. The final version of Article 5 provides a clear response to the need for flexibility as regards the 14.33 management of copyright and related rights. In addition to the possibility offered to rightholders under Article 5(2) to choose the organisation that will manage their rights, categories of right or types of works and other subject matter, the legislator clearly goes one step further than the Proposal did, in allowing, on the basis of Article 5(3), rightholders to exercise the right to grant licences for non-commercial uses. This will hopefully bring significant changes in the manner in which collective management organisations will go about dealing with requests from rightholders to apply one of the three non-commercial variations of the Creative Commons licences to their works. Note, however, that non-commercial licences can therefore be granted regarding the use of any rights, categories of rights or types of works and other subject matter, but not regarding individual works. Collective management organisations should also inform rightholders of their choices and allow 14.34 them to exercise the rights related to those choices as easily as possible. Rightholders who have already authorised the collective management organisation may be informed via the website of the organisation. This Directive should not prejudice the possibility for rightholders to manage their rights individually, including for non-commercial uses, as well as the possibility to terminate or withdraw rights, categories of rights or types of works or other subject matter from a collective management organisation. Freedom to grant or withdraw rights management authorisation, subject to reasonable notice, is an 14.35 important principle, which strengthens the position of rightholders. The rapporteur of the EESC endorses this provision subject to two reservations: first, the rapporteur cautions that the provision must not be abused. In order to protect all creators, it is necessary to avoid a situation in which well-known artists withdraw authorisation where rights management costs are lower, while continuing to authorise the management of rights only where they present greater difficulties, since this could undermine the effectiveness of collective management organisations. Secondly, the

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rapporteur warns that additional rights fragmentation would make multi-territorial and multirepertoire licensing more difficult. A balance must be struck between the various objectives.33 The EESC noted in addition that: artists should have better control of the promotion of their online works and the income they generate. They should be able to distribute certain works directly, for free or at a very low cost, in order to promote them. New financing sources for the work of authors are now possible via the internet, such as calls for financing by the listeners of future productions. The directive should therefore provide authors with more control and options.34

14.36 Paragraph 7 of Article 5 requires that the rightholder give ‘express consent’ specifically for each right or category of rights or type of works, which the collective management organisation is authorised to manage. The author’s contract law of a number of Member States, including France and Belgium, requires that contracts set out specifically what rights or categories of rights are transferred by means of an exploitation contract. In most countries, these obligations are deemed not to apply to the relationship between collective management organisations and their members, in view of the fact that collective management organisations are presumed to operate in their members’ best interest and that a complete and broad transfer of exploitation rights strengthens their bargaining position against powerful users, like radio and television broadcasters.35 Since the EC’s GEMA decisions, which listed the most common categories of rights managed collectively, the exploitation contracts of most collective management organisations today enumerate the categories of rights transferred in their favour. Some collective management organisations are resisting, however, and still ask for a complete, unspecified transfer of rights.36 If correctly implemented, this provision of the Directive would most likely put an end to this practice. Note however, that Recital 19 further specifies that: a requirement for the consent of rightholders in the authorisation to the management of each right, category of rights or type of works and other subject matter should not prevent the rightholders from accepting proposed subsequent amendments to that authorisation by tacit agreement in accordance with the conditions set out in national law. Neither contractual arrangements according to which a termination or withdrawal by rightholders has an immediate effect on licences granted prior to such termination or withdrawal, nor contractual arrangements according to which such licences remain unaffected for a certain period of time after such termination or withdrawal, are, as such, precluded by this Directive. Such arrangements should not, however, create an obstacle to the full application of this Directive.

While such a specification may encourage rightholders to withdraw some of their rights (either for individual management or for management by another society), with the consequence of fragmenting the collective management organisation’s repertoire, it would facilitate the exercise of the rightholder’s choice. A problem arises, however, when a collective management organisation is competent to manage the rights of outsiders: non-members are not in a position to give their express consent. 14.37 In this vein, it is worth mentioning the recommendation made by the Max Planck Institute of Intellectual Property and Competition Law that this provision be accompanied by an obligation on collective management organisations to contract with rightholders. Giving the choice of collective 33

34 35

36

Working Document on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, COM(2012)0372 – C7-0183/2012 – 2012/0180(COD), Committee on Legal Affairs, Rapporteur: Marielle Gallo, 4 March 2013. Ibid, para. 4.6. See P.B. Hugenholtz and L. Guibault with the collaboration of M.A.R. Vermunt and M. Berghuis, ‘Study on the conditions applicable to contracts relating to intellectual property in the European Union’, final report, study commissioned by the European Commission, IViR, May 2002. L. Guibault, ‘Halleluja: Buma’s aansluitvoorwaarden krijgen zegen van NMa!’, (2008) AMI, 4, 85–93.

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ARTICLE 6: MEMBERSHIP RULES OF COLLECTIVE MANAGEMENT ORGANISATIONS

management organisation to a rightholder is only effective if it is supported by such an obligation.37 This point is addressed in Article 5(2) of the Directive.

NOTES 1. Related instruments Working Document on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, COM(2012)0372 – C7-0183/2012 – 2012/0180(COD), Committee on Legal Affairs, Rapporteur: Marielle Gallo, 4 March 2013. European Parliament, Resolution on a Community framework for collective management societies in the field of copyright and neighbouring rights (2002/2274(INI)), P5_TA (2004) 0036, Strasbourg, 15 January 2004. Treaty for the Functioning of the European Union (TFEU).

2. CJEU case law Commission Decision 71/224 GEMA I (Gesellschaft für musikalische Aufführungs- und mechanische Vervielfältigungsrechte), (1971) OJ L 134/15. GVL v Commission (Case 7/82) [1983] ECR 483. Case COMP/C2/37.219, Banghalter / Homem Christo (Daft Punk) v SACEM, Commission Decision of European Commission 6 August 2002.

3. Bibliography Communia policy paper on the Directive proposal on Collective Management of Copyright, Brussels, 2012. Hugenholtz, P.B. and L. Guibault with the collaboration of M.A.R. Vermunt and M. Berghuis, ‘Study on the conditions applicable to contracts relating to intellectual property in the European Union’, final report, study commissioned by the European Commission, IViR, May 2002. Max Planck Institute for Intellectual Property and Competition Law, Comments on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, Munich, 2012.

ARTICLE 6: MEMBERSHIP RULES OF COLLECTIVE MANAGEMENT ORGANISATIONS 1. 2.

3.

37

Member States shall ensure that collective management organisations comply with the rules laid down in paragraphs 2 to 5. A collective management organisation shall accept rightholders and entities representing rightholders, including other collective management organisations and associations of rightholders, as members if they fulfill the membership requirements, which shall be based on objective, transparent and non-discriminatory criteria. Those membership requirements shall be included in the statute or membership terms of the collective management organisation and shall be made publicly available. Where a collective management organisation refuses to accept a request for membership, it shall provide the rightholder with a clear explanation of the reasons for its decision. The statute of the collective management organisation shall provide for appropriate and effective mechanisms of participation of its members in the organisation’s decisionmaking process. The representation of the different categories of members in the decision-making process shall be fair and balanced.

Max Planck Institute for Intellectual Property and Competition Law, 7.

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4. 5.

A collective management organisation shall allow their members to communicate with it by electronic means, including for the purposes of exercising members’ rights. A collective management organisation shall keep records of its members and shall regularly update those records.

I. COMMENTARY 14.38 Clear membership rules that take account of the different interests of the various categories of rightholders are essential, especially where the national laws allow the collective management organisation to collect and administer revenues on behalf of non-members, like in the case of extended collective licensing regimes. The Max Planck Institute’s report drew attention to the importance of guaranteeing that the membership structure of collective management organisations addresses the need to differentiate between categories of members, making the respective rights and obligations of each of them explicit within the decision-making process.38 Articles 6 and 7 of the Directive introduce very detailed rules regarding the membership of collective management organisations and the treatment of rightholders who have a direct legal relationship by law or by way of assignment, licence or any other contractual arrangement with collective management organisations, but who are not their members. 14.39 Regarding rightholders who become members of a collective management organisation, Recital 20 reinforces the principle established in Article 6 that membership should be based on objective, transparent and non-discriminatory criteria, including as regards publishers who by virtue of an agreement on the exploitation of rights are entitled to a share of the income from the rights managed by collective management organisations and to collect such income from the collective management organisations. Those criteria should not oblige collective management organisations to accept members the management of whose rights, categories of rights or types of works or other subject matter falls outside their scope of activity. Of particular importance in the context of the orphan works issue, Article 6(5) requires that the collective management organisation keep records to allow for the identification and location of its members and rightholders whose rights the organisation manages on the basis of authorisations given by those rightholders.

ARTICLE 7: RIGHTS OF RIGHTHOLDERS WHO ARE NOT MEMBERS OF THE COLLECTIVE MANAGEMENT ORGANISATION 1.

2.

Member States shall ensure that collective management organisations comply with the rules laid down in Article 6(4), Article 20, Article 29(2) and Article 33 in respect of rightholders who have a direct legal relationship by law or by way of assignment, licence or any other contractual arrangement with them but are not their members. Member States may apply other provisions of this Directive to the rightholders referred to in paragraph 1.

I. COMMENTARY 14.40 Article 7 is a new and important addition to the text of the Directive, compared to the Proposal. That some protection be granted to rightholders who are affected by decisions of collective management organisations even though they are not members, was deemed paramount, especially

38

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ARTICLE 8: GENERAL ASSEMBLY OF MEMBERS OF THE COLLECTIVE MANAGEMENT ORGANISATION

in the context of extended collective licensing or of statutory licensing regimes. In support of Article 7 of the Directive, Recital 21 states that: in order to protect those rightholders who are directly represented by the collective management organisation but who do not fulfil its membership requirements, it is appropriate to require that certain provisions of this Directive relating to members be also applied to such rightholders. Member States should be able also to provide such rightholders with rights to participate in the decision-making process of the collective management organisation.

The minimum rules to be complied with are those of Article 6(4) on the right to communicate with the collective management organisation by electronic means; Article 20 on the provision of information on the rights, categories of rights and types of works managed by the collective management organisation; Article 29(2) on the provision of information about the main terms of the agreement with a mandated organisation; and Article 33 on the complaint procedure. Member States may apply other provisions of the Directive to the relationship between collective management organisations and non-member rightholders.

NOTES 1. Related instruments Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044/104, 15.02.2013. Commission Staff Working Document Impact Assessment Accompanying the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online uses in the internal market, Brussels, 11.7.2012 SWD(2012) 204 final.

2. Bibliography Max Planck Institute for Intellectual Property and Competition Law, Comments on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, Munich, 2012.

ARTICLE 8: GENERAL ASSEMBLY OF MEMBERS OF THE COLLECTIVE MANAGEMENT ORGANISATION 1. 2. 3. 4.

Member States shall ensure that the general assembly of members is organised in accordance with the rules laid down in paragraphs 2 to 10. A general assembly of members shall be convened at least once a year. The general assembly of members shall decide on any amendments to the statute and to the membership terms of the collective management organisation, where those terms are not regulated by the statute. The general assembly of members shall decide on the appointment or dismissal of the directors, review their general performance and approve their remuneration and other benefits such as monetary and non-monetary benefits, pension awards and entitlements, rights to other awards and rights to severance pay. In a collective management organisation with a dual board system, the general assembly of members shall not decide on the

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5.

6. 7. 8.

9.

10.

appointment or dismissal of members of the management board or approve their remuneration and other benefits where the power to take such decisions is delegated to the supervisory board. In accordance with the provisions laid down in Chapter 2 of Title II, the general assembly of members shall decide at least on the following issues: (a) the general policy on the distribution of the amounts due to rightholders; (b) the general policy on the use of non-distributable amounts; (c) the general investment policy with regard to rights revenue and to any income arising from the investment of rights revenue; (d) the general policy on deductions from rights revenue and from any income arising from the investment of rights revenue. (e) the use of non-distributable amounts; (f) the risk management policy; (g) the approval of any acquisition, sale or hypothecation of immovable property; (h) the approval of mergers and alliances, the setting-up of subsidiaries, and the acquisition of other entities or shares or rights in other entities; (i) the approval of taking out loans, granting loans or providing security for loans. The general assembly of members may delegate the powers listed in points (f), (g), (h) and (i) of paragraph 5, by a resolution or by a provision in the statute, to the body exercising the supervisory function. For the purposes of points (a) to (d) of paragraph 5, Member States may decide that the general assembly of members is to determine more detailed conditions for the use of the rights revenue and the income arising from the investment of rights revenue. The general assembly of members shall control the activities of the collective management organisation by, at least, deciding on the appointment and removal of the auditor and approving the annual transparency report referred to in Article 22. Member States may allow alternative systems or modalities for the appointment and removal of the auditor, provided that those systems or modalities are designed to ensure the independence of the auditor from the persons who manage the business of the collective management organisation. All members of the collective management organisation shall have the right to participate and the right to vote at the general assembly of members. However, Member States may allow for restrictions on the right of the members, of the collective management organisation to participate in, and to exercise voting rights at, the general assembly of members, on the basis of one or both of the following criteria: (a) duration of membership; (b) amounts received or due to a member, provided that such criteria are determined and applied in a manner that is fair and proportionate. The criteria laid down in points (a) and (b) of the first subparagraph shall be included in the statute or the membership terms of the collective management organisation and shall be made publicly available in accordance with Articles 19 and 21. Every member of a collective management organisation shall have the right to appoint any other person or entity as a proxy holder to participate in, and vote at, the general assembly of members on his behalf, provided that such appointment does not result in a conflict of interest which might occur, for example, where the appointing member and the proxy holder belong to different categories of rightholders within the collective management organisation. However, Member States may provide for restrictions concerning the appointment of proxy holders and the exercise of the voting rights of the members they represent if such restrictions do not prejudice the appropriate and effective participation of members in the decision-making process of a collective management organisation.

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ARTICLE 8: GENERAL ASSEMBLY OF MEMBERS OF THE COLLECTIVE MANAGEMENT ORGANISATION

11.

12.

13.

Each proxy shall be valid for a single general assembly of members. The proxy holder shall enjoy the same rights in the general assembly of members as those to which the appointing member would be entitled. The proxy holder shall cast votes in accordance with the instructions issued by the appointing member. Member States may decide that the powers of the general assembly of members may be exercised by an assembly of delegates elected at least every four years by the members of the collective management organisation, provided that: (a) appropriate and effective participation of members in the collective management organisation’s decision-making process is ensured; and (b) the representation of the different categories of members in the assembly of delegates is fair and balanced. The rules laid down in paragraphs 2 to 10 shall apply to the assembly of delegates mutatis mutandis. Member States may decide that where a collective management organisation, by reason of its legal form, does not have a general assembly of members, the powers of that assembly are to be exercised by the body exercising the supervisory function. The rules laid down in paragraphs 2 to 5, 7 and 8 shall apply mutatis mutandis to such body exercising the supervisory function. Member States may decide that where a collective management organisation has members who are entities representing rightholders, all or some of the powers of the general assembly of members are to be exercised by an assembly of those rightholders. The rules laid down in paragraphs 2 to 10 shall apply mutatis mutandis to the assembly of rightholders.

I. COMMENTARY In its Resolution of 2004 the European Parliament stressed that collective management organ- 14.41 isations ‘must operate according to the principles of transparency, democracy and the participation of creators’. The Parliament added that ‘internal democratic structures of collective management societies are fundamental for legitimising their activity and for them to operate effectively’ and for this reason called for the ‘establishment of minimum standards for organisational structures, transparency, accounting and legal remedies’.39 In its Resolution, the Parliament also repeatedly stressed the need for equal representation of all member groups within the structures of a collective management organisation. Article 8 of the Directive is a great improvement over the text of the Proposal, for it spells out more 14.42 clearly and extensively than before the powers and functioning of the general assembly. It ensures that the general assembly is the main body within a collective management organisation that is empowered to make the appropriate decisions regarding all matters of importance for an effective and balanced management of rights. The powers of the general assembly have been widely increased compared to the Proposal, including for example the power to decide on the use of nondistributable amounts, and on the risk management policy. Moreover, the text of the Directive now takes account of the different member groups within a collective management organisation and of its corporate structure or legal form. Article 8, in conjunction with Recital 23, lays down the principle that all members of collective 14.43 management organisations should be allowed to participate and vote in the general assembly of

39

European Parliament, Resolution on a Community framework for collective management societies in the field of copyright and neighbouring rights (2002/2274(INI)), P5_TA(2004)0036, Strasbourg, 15 January 2004, 5, paras 29–30, 39.

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members. The exercise of those rights should be subject only to fair and proportionate restrictions. In some exceptional cases, collective management organisations are established in the legal form of a foundation, and thus have no members. In such cases, the powers of the general assembly should be exercised by the body entrusted with the supervisory function. Where collective management organisations have entities representing rightholders as their members, as may be the case where a collective management organisation is a limited liability company and its members are associations of rightholders, Member States should be able to provide that some or all powers of the general assembly of members are to be exercised by an assembly of those rightholders. The general assembly of members should, at least, have the power to set the framework of the activities of the management, in particular with respect to the use of rights revenue by the collective management organisation. This should, however, be without prejudice to the possibility for Member States to provide for more stringent rules on, for example, investments, mergers or taking out loans, including a prohibition on any such transactions. Collective management organisations should encourage the active participation of their members in the general assembly. The exercise of voting rights should be facilitated for members who attend the general assembly and also for those who do not. In addition to being able to exercise their rights by electronic means, members should be allowed to participate and vote in the general assembly of members through a proxy. Proxy voting should be restricted in cases of conflicts of interest. At the same time, Member States should provide for restrictions as regards proxies only if this does not prejudice the appropriate and effective participation of members in the decision-making process. In particular, the appointment of proxy-holders contributes to the appropriate and effective participation of members in the decision-making process and allows rightholders to have a true opportunity to opt for a collective management organisation of their choice, irrespective of the Member State of establishment of the organisation.

NOTES 1. Related instruments Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044/104, 15.02.2013. Commission Staff Working Document Impact Assessment Accompanying the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online uses in the internal market, Brussels, 11.7.2012 SWD(2012) 204 final.

2. Bibliography Max Planck Institute for Intellectual Property and Competition Law, Comments on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, Munich, 2012.

ARTICLE 9: SUPERVISORY FUNCTION 1. 2.

Member States shall ensure that each collective management organisation has in place a supervisory function for continuously monitoring the activities and the performance of the duties of the persons who manage the business of the organisation. There shall be fair and balanced representation of the different categories of members of the collective management organisation in the body exercising this function.

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ARTICLE 10: OBLIGATIONS OF THE PERSONS WHO EFFECTIVELY MANAGE THE BUSINESS

3. 4.

5.

Each person exercising the supervisory function shall make an annual individual statement on conflicts of interest, containing the information referred to in the second subparagraph of Article 10(2), to the general assembly of members. The body exercising the supervisory function shall meet regularly and shall have at least the following powers: (d) to exercise the powers delegated to it by the general assembly of members, including under Article 8(4) and (6); (e) to monitor the activities and the performance of the duties of the persons referred to in Article 10, including the implementation of the decisions of the general assembly of members and, in particular, of the general policies listed in points (a) to (d) of Article 8(5). The body exercising the supervisory function shall report on the exercise of its powers to the general assembly of members at least once a year.

ARTICLE 10: OBLIGATIONS OF THE PERSONS WHO EFFECTIVELY MANAGE THE BUSINESS OF THE COLLECTIVE MANAGEMENT ORGANISATION 1.

2.

Member States shall ensure that each collective management organisation takes all necessary measures so that the persons who manage its business do so in a sound, prudent and appropriate manner, using sound administrative and accounting procedures and internal control mechanisms. Member States shall ensure that collective management organisations put in place and apply procedures to avoid conflicts of interest, and where such conflicts cannot be avoided, to identify, manage, monitor and disclose actual or potential conflicts of interest in such a way as to prevent them from adversely affecting the collective interests of the rightholders whom the organisation represents. The procedures referred to in the first subparagraph shall include an annual individual statement by each of the persons referred to in paragaph 1 to the general assembly of members, containing the following information: (a) any interests in the collective management organisation; (b) any remuneration received in the preceding financial year from the collective management organisation, including in the form of pension schemes, benefits in kind and other types of benefits; (c) any amounts received in the preceding financial year as a rightholder from the collective management organisation; (d) a declaration concerning any actual or potential conflict between any personal interests and those of the collective management organisation or between any obligations owed to the collective management organisation and any duty owed to any other natural or legal person.

I. COMMENTARY As Article 8 on the role and powers of the general assembly, Articles 9 and 10 on the supervisory 14.44 function and on the obligations of the persons who manage the business of the collective management organisation have been reinforced to guarantee a high level of control over and monitoring of the activities of the organisation. Recital 24 explains that: Members should be allowed to participate in the continuous monitoring of the management of collective management organisations. To that end, those organisations should have a supervisory function appropriate to their organisational structure and should allow members to be represented in the body that exercises that

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Chapter 14 THE COLLECTIVE RIGHTS MANAGEMENT DIRECTIVE function. Depending on the organisational structure of the collective management organisation, the supervisory function may be exercised by a separate body, such as a supervisory board, or by some or all of the directors in the administrative board who do not manage the business of the collective management organisation. The requirement of fair and balanced representation of members should not prevent the collective management organisation from appointing third parties to exercise the supervisory function, including persons with relevant professional expertise and rightholders who do not fulfil the membership requirements or who are represented by the organisation not directly but via an entity which is a member of the collective management organisation.

14.45 Recital 25 emphasises the need for a collective management organisation to ensure that the management is independent. To this end, managers, whether elected as directors or hired or employed by the organisation on the basis of a contract, should be required to declare, prior to taking up their position and thereafter on a yearly basis, whether there are conflicts between their interests and those of the rightholders that are represented by the collective management organisation. Such annual statements should be also made by persons exercising the supervisory function. Member States should be free to require collective management organisations to make such statements public or to submit them to public authorities. The conflict of interest also applies with regard to any supervisory role towards a CMO. Such is the example of Greece where their national supervisory body (i.e. the Hellenic Copyright Organisation (part of the Ministry of Culture) exercises (even temporarily) collective management services (as EYED/HCO – a special vehicle for collective management) and it also supervises itself as well as other (competing on the same market) CMOs. In fact, in this case there is a conflict of interest.40

NOTES 1. Related instruments Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044/104, 15.02.2013. Commission Staff Working Document Impact Assessment Accompanying the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online uses in the internal market, Brussels, 11.7.2012 SWD(2012) 204 final.

2. Bibliography Max Planck Institute for Intellectual Property and Competition Law, Comments on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, Munich, 2012.

40

According to Decision No 1009/2020 of the Conseil d’Etat, EYED – established in June 2018 with a view to being active for two years – was not found to be a CMO and therefore did not have to abide by the provisions for collective management and nor did it infringe on other the provisions of competition law. Yet, this judgment contradicts the relevant literature and case law in the area.

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ARTICLE 12: DEDUCTIONS

CHAPTER 2 MANAGEMENT OF RIGHTS REVENUE ARTICLE 11: COLLECTION AND USE OF RIGHTS REVENUE 1. 2. 3.

4.

5.

Member States shall ensure that collective management organisations comply with the rules laid down in paragraphs 2 to 5. A collective management organisation shall be diligent in the collection and the management of rights revenue. A collective management organisation shall keep separate in its accounts: (a) rights revenue and any income arising from the investment of rights revenue; and (b) any own assets it may have and income arising from such assets, from management fees or from other activities. A collective management organisation shall not be permitted to use rights revenue and any income arising from the investment of rights revenue for purposes other than distribution to rightholders, except where it is allowed to deduct or offset its management fees in compliance with a decision taken in accordance with point (d) of Article 8(5) or to use the rights revenue or any income arising from the investment of rights revenue in compliance with a decision taken in accordance with Article 8(5). Where a collective management organisation invests rights revenue or any income arising from the investment of rights revenue, it shall do so in the best interests of the rightholders whose rights it manages, in accordance with the general investment and risk management policy referred to in points (c) and (f) of Article 8(5) and having regard to the following rules: (a) where there is any potential conflict of interest, the collective management organisation shall ensure that the investment is made in the sole interest of those rightholders; (b) the assets shall be invested in order to ensure the security, quality, liquidity and profitability of the portfolio as a whole; (c) the assets shall be properly diversified in order to avoid excessive reliance on any particular asset and accumulations of risks in the portfolio as a whole.

ARTICLE 12: DEDUCTIONS 1.

2. 3.

Member States shall ensure that where a rightholder authorises a collective management organisation to manage his rights, the collective management organisation is required to provide the rightholder with information on management fees and other deductions from the rights revenue and from any income arising from the investment of rights revenue, before obtaining his consent to its managing his rights. Deductions shall be reasonable in relation to the services provided by the collective management organisation to rightholders, including, where appropriate, the services referred to in paragraph 4, and shall be established on the basis of objective criteria. Management fees shall not exceed the justified and documented costs incurred by the collective management organisation in managing copyright and related rights. Member States shall ensure that the requirements applicable to the use and the transparency of the use of amounts deducted or offset in respect of management fees apply to any other deductions made in order to cover the costs of managing copyright and related rights.

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4.

Where a collective management organisation provides social, cultural or educational services funded through deductions from rights revenue or from any income arising from the investment of rights revenue, such services shall be provided on the basis of fair criteria, in particular as regards access to, and the extent of those services.

ARTICLE 13: DISTRIBUTION OF THE AMOUNTS DUE TO RIGHTHOLDERS 1.

2.

3.

4.

5.

Without prejudice to Articles 15(3) and 28, Member States shall ensure that each collective management organisation regularly, diligently and accurately distributes and pays amounts due to rightholders in accordance with the general policy on distribution referred to in point (a) of Article 8(5). Member States shall also ensure that collective management organisations or their members who are entities representing rightholders distribute and pay those amounts to rightholders as soon as possible but no later than nine months from the end of the financial year in which the rights revenue was collected, unless objective reasons relating in particular to reporting by users, identification of rights and rightholders or matching of information on works and other subject-matter with rightholders prevent the collective management organisation or, where applicable, its members from meeting that deadline. Where the amounts due to rightholders cannot be distributed within the deadline set in paragraph 1 because the relevant rightholders cannot be identified or located and the exception to that deadline does not apply, those amounts shall be kept separate in the accounts of the collective management organisation. The collective management organisation shall take all necessary measures, consistent with paragraph 1, to identify and locate the rightholders. In particular, at the latest three months after the expiry of the deadline set in paragraph 1, the collective management organisation shall make available information on works and other subject-matter for which one or more rightholders have not been identified or located to: (a) the rightholders that it represents or the entities representing rightholders, where such entities are members of the collective management organisation, and (b) all collective management organisations with which it has concluded representation agreements. The information referred to in the first subparagraph shall include, where available, the following: (a) the title of the work or other subject-matter, (b) the name of the rightholder, (c) the name of the relevant publisher or producer, and (d) any other relevant information available which could assist in identifying the rightholder. The collective management organisation shall also verify the records referred to in Article 6(5) and other readily available records. If the abovementioned measures fail to produce results, the collective management organisation shall make that information available to the public at the latest one year after the expiry of the three-month period. Where the amounts due to rightholders cannot be distributed after three years from the end of the financial year in which the collection of the rights revenue occurred, and provided that the collective management organisation has taken all necessary measures to identify and locate the rightholders referred to in paragraph 3, those amounts shall be deemed non-distributable. The general assembly of members of a collective management organisation shall decide on the use of the non-distributable amounts in accordance with point (b) of Article 8(5), without prejudice to the right of rightholders to claim such amounts from the collective

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ARTICLE 13: DISTRIBUTION OF THE AMOUNTS DUE TO RIGHTHOLDERS

6.

management organisation in accordance with the laws of the Member States on the statute of limitations of claims. Member States may limit or determine the permitted uses of non-distributable amounts, inter alia by ensuring that such amounts are used in a separate and independent way in order to fund social, cultural and educational activities for the benefit of rightholders.

I. COMMENTARY Solid rules on the collection, administration and distribution of revenue generated by the exploit- 14.46 ation of rights on the works in the repertoire managed by collective management organisations are the cornerstone of an efficient collective management system for all parties concerned. Here as well, the rules laid down in Articles 11–13 dealing respectively with the collection and use of revenue generated by the exploitation of the repertoire, the deductions allowed and the distribution of the sums perceived to the rightholders have been considerably sharpened compared to the text of the Proposal to make sure that the collection, management and distribution of rights revenue and of income arising from the investment of rights revenue occurs diligently and accurately in the best interest of the rightholders. By setting out clear rules on the financial management of rights revenue and by putting an obligation on the Member States to ensure that collective management organisations comply with these rules, the European Commission hopes to avoid any form of abuse or mismanagement. In support of Article 11 on the collection and use of rights revenue, Recital 26 emphasises that the 14.47 revenue collected, managed and distributed from the exploitation of the rights entrusted to them by rightholders is ultimately due to the rightholders, whether the rightholders have a direct legal relationship with the organisation, or are represented via an entity which is a member of the collective management organisation or via a representation agreement. Collective management organisations should therefore exercise the utmost diligence in collecting, managing and distributing that revenue. Recital 26 goes on to state that accurate distribution is only possible where the collective management organisation maintains proper records of membership, licences and use of works and other subject matter. Relevant data that are required for the efficient collective management of rights should also be provided by rightholders and users and verified by the collective management organisation. The bookkeeping of certain collective management organisations in Europe did leave something to 14.48 be desired and the new rules are not superfluous. In its Simulcasting decision,41 the European Commission had for example ordered the parties to increase transparency as regards the payment charged, by separating the tariff, which covered the royalty proper from the fee meant to cover the administration costs.42 This transparency in pricing would, according to the Commission, enable users to recognise the most efficient societies and to seek their licences from the society that provides them at the lower cost. Both Article 11(2) and Recital 27 require that amounts collected and due to rightholders be kept separately in the accounts from any own assets the organisation may have. In order to maintain a high level of protection of the rights of rightholders and to ensure that any income that may arise from the exploitation of such rights accrues to their benefit, the investments made and held by the collective management organisation should be managed in accordance with criteria which would oblige the organisation to act prudently, while allowing it to decide on the most secure and efficient investment policy. This should allow the collective management organisation to opt for an asset allocation that suits the precise nature and duration of

41 42

Case No COMP/C2/38.014 – “IFPI Simulcast”, J.O.C.E. L 157/59, 30 April 2003. See L. Guibault and S. van Gompel, ‘Collective management in the European Union’, in Gervais, D. (ed.), Collective Management of Copyright and Related Rights, Kluwer Law International, The Hague, 2006, 117–52.

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any exposure to risk of any rights revenue invested and does not unduly prejudice any rights revenue owed to rightholders. 14.49 Article 12 of the Directive deals with deductions granted by a collective management organisation. The term ‘deduction’ is not defined in the Directive and is probably to be understood in relation to the expression ‘management fee’, defined in Article 3(i) as ‘the amounts charged, deducted or offset by a collective management organisation from rights revenue or from any income arising from the investment of rights revenue in order to cover the costs of its management of copyright or related rights’. Article 12(1) obliges Member States to ensure that collective management organisations inform rightholders about ‘management fees and other deductions’ from the rights revenue and from any income arising from the investment of rights revenue. Recital 28 stresses the need for management fees not to exceed justified costs of the management of the rights and for any deduction other than in respect of management fees, for example a deduction for social, cultural or educational purposes, to be decided by the members of the collective management organisation. Transparency towards rightholders regarding the rules governing such deductions is paramount. The same requirements should apply to any decision to use the rights revenue for collective distribution, such as scholarships. Rightholders should have access, on a non-discriminatory basis, to any social, cultural or educational service funded through such deductions. Deductions under national law, such as deductions for the provision of social services by collective management organisations to rightholders, remain unaffected as regards any aspects that are not regulated by the Directive, provided that such deductions are in compliance with Union law. These statutory deduction systems were already recognised as valid by the CJEU in the Amazon decision.43 14.50 Article 13 concerns the distribution of the amounts due to rightholders, putting special emphasis on the collective management organisations’ obligation to identify and locate rights owners, e.g. record-keeping obligations, and the management and use of non-distributable rights revenue and income arising from the investment of rights revenue. Recital 29 expresses the importance for the distribution and payment of amounts due to individual rightholders or, as the case may be, to categories of rightholders, to be carried out in a timely manner and in accordance with the general policy on distribution of the collective management organisation concerned, including when they are performed via another entity representing the rightholders. Only objective reasons beyond the control of a collective management organisation can justify delay in the distribution and payment of amounts due to rightholders. More importantly, Recital 29 states that ‘circumstances such as the rights revenue having been invested subject to a maturity date should not qualify as valid reasons for such a delay’. Member States are free to decide on rules ensuring timely distribution and the effective search for, and identification of, rightholders in cases where such objective reasons occur. But in order to ensure that the amounts due to rightholders are appropriately and effectively distributed, collective management organisations should be required to take reasonable and diligent measures, on the basis of good faith, to identify and locate the relevant rightholders. In addition, members of a collective management organisation, to the extent allowed for under national law, should be able to decide on the use of any amounts that cannot be distributed in situations where rightholders entitled to those amounts cannot be identified or located.

43

Case C-521/11, Amazon v. Austro-Mechana, July 11, 2013, ECLI:EU:C:2013:515, para 55.

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ARTICLE 15: DEDUCTIONS AND PAYMENTS IN REPRESENTATION AGREEMENTS

NOTES 1. Related instruments Commission Staff Working Document Impact Assessment Accompanying the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online uses in the internal market, Brussels, 11.7.2012 SWD(2012) 204 final. Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044/104, 15.02.2013.

2. CJEU case law Commission Decision of 16 July 2008 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case COMP/C2/38.698 – CISAC), C (2008) 3435 final, [2009] 4 CMLR 12. Commission Decision of 8 October 2002 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case No COMP/C2/38.014 – IFPI ‘Simulcasting’, (April 30, 2003) OJ L 107/58 (EC).

3. Bibliography Guibault, L. and S. van Gompel, ‘Collective management in the European Union’, in Gervais, D. (ed.), Collective Management of Copyright and Related Rights, Kluwer Law International, The Hague, 2006, 117–52. Max Planck Institute for Intellectual Property and Competition Law, Comments on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, Munich, 2012.

CHAPTER 3 MANAGEMENT OF RIGHTS ON BEHALF OF OTHER COLLECTIVE MANAGEMENT ORGANISATIONS ARTICLE 14: RIGHTS MANAGED UNDER REPRESENTATION AGREEMENTS Member States shall ensure that a collective management organisation does not discriminate against any rightholders whose rights it manages under a representation agreement, in particular with respect to applicable tariffs, management fees, and the conditions for the collection of the rights revenue and distribution of the amounts due to rightholders.

ARTICLE 15: DEDUCTIONS AND PAYMENTS IN REPRESENTATION AGREEMENTS 1.

2.

Member States shall ensure that a collective management organisation does not make deductions, other than in respect of management fees, from the rights revenue derived from the rights it manages on the basis of a representation agreement, or from any income arising from the investment of that rights revenue, unless the other collective management organisation that is party to the presentation agreement expressly consents to such deductions. The collective management organisation shall regularly, diligently and accurately distribute and pay amounts due to other collective management organisations.

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3.

The collective management organisation shall carry out such distribution and payments to the other collective management organisation as soon as possible but no later than nine months from the end of the financial year in which the rights revenue was collected, unless objective reasons relating in particular to reporting by users, identification of rights and rightholders or matching of information on works and other subject-matter with rightholders prevent the collective management organisation from meeting that deadline. The other collective management organisation, or, where it has as members entities representing rightholders, those members, shall distribute and pay the amounts due to rightholders as soon as possible but no later than six months from receipt of those amounts, unless objective reasons relating in particular to reporting by users, identification of rights and rightholders or matching of information on works and other subjectmatter with rightholders prevent the collective management organisation or, where applicable, its members from meeting that deadline.

I. COMMENTARY 14.51 The rights clearance for the exploitation of non-domestic repertoire has existed for decades on the basis of a network of reciprocal representation arrangements between collective management organisations. This remains the case for all analogue uses, whether it is on the basis of voluntary or statutory licences, and for online uses of non-musical repertoire. Through reciprocal agreements, collective management organisations give each other the right, on a non-exclusive basis, to exploit the copyrights on their respective repertoire in their respective territories. As the CJEU stated in the Tournier decision, the advantage of a system of reciprocal agreements is that it, ‘enables copyrightmanagement societies to rely, for the protection of their repertoires in another State, on the organization established by the copyright-management society operating there, without being obliged to add to that organization their own network of contracts with users and their own local monitoring arrangements’.44 As the case law has recognised these contracts may, however, conflict with Article 101 TFEU if the refusal to allow direct access to a part of their repertoire by foreign users is due to a concerted practice. 14.52 The main principle put forward in Article 14 of the Directive regarding rights managed under representation agreements is that of non-discrimination in treatment between members and non-members. Under Article 15, the express consent of the counterparty collective management organisation for any deductions other than management fees on said non-members’ rights revenue also constituted somewhat of a novelty. In practice, this puts a definite end to reciprocal agreements known as ‘type B agreements’, under which no money or data is transferred and each society collects and distributes royalties used in its territory only to its own rightholders.45 This form of agreement was seen as generally prejudicial to the interests of the rightholders, although it could be beneficial to small or start-up collective management organisations. Although there is no explicit requirement in this sense under Articles 14 or 15 of the Directive, it flows from the European Commission’s decision in the IFPI Simulcasting case46 that the tariff that covers the royalty proper be separated from the fee meant to cover the administration costs. 14.53 Recital 30 further explains that:

44 45 46

C-395/87 Tournier, para. 19. European Commission, Commission Staff Working Document – Study on a Community Initiative on the Cross-Border Collective Management of Copyright, Brussels, 7 July 2005, 12. Commission Decision 2003/300/EC of 8 October 2002 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case No COMP/C2/38.014 – IFPI ‘Simulcasting’), OJ L 107/58 of 30.4.2003, para. 103.

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ARTICLE 15: DEDUCTIONS AND PAYMENTS IN REPRESENTATION AGREEMENTS To protect the rights of the members of the other collective management organisation, a collective management organisation should not distinguish between the rights it manages under representation agreements and those it manages directly for its rightholders. Nor should the collective management organisation be allowed to apply deductions to the rights revenue collected on behalf of another collective management organisation, other than deductions in respect of management fees, without the express consent of the other organisation. Moreover collective management organisations are required to distribute and make payments to other organisations on the basis of such representation agreements no later than when they distribute and make payments to their own members and to non-member rightholders whom they represent. Furthermore, the recipient organisation should in turn be required to distribute the amounts due to the rightholders it represents without delay.

NOTES 1. Related instruments European Commission, Commission Staff Working Document – Study on a Community Initiative on the Cross-Border Collective Management of Copyright, Brussels, 7 July 2005. Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044/104, 15.02.2013.

2. CJEU case law Commission Decision of 16 July 2008 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case COMP/C2/38.698 – CISAC), C (2008) 3435 final, [2009] 4 CMLR 12. Commission Decision 2003/300/EC of 8 October 2002 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case No COMP/C2/38.014 – IFPI ‘Simulcasting’), OJ L 107/58 of 30.4.2003.

3. Bibliography Dietz, A. ‘European Parliament versus Commission: How to deal with collecting societies’ (2004) IIC, 35, 809–20. Drexl, J. ‘Competition in the field of collective management: preferring “creative competition” to allocative efficiency in European copyright law’, in P.L.C. Torremans (ed.), Copyright Law: A Handbook of Contemporary Research, Edward Elgar, Cheltenham, UK and Northampton, MA, USA, 2007. Frabboni, M.M. ‘Collective Management of Copyright and Related Rights: Achievements and Problems of Institutional Efforts towards Harmonisation’, in Derclaye, E. (ed.), Research Handbook on the Future of EU Copyright, Edward Elgar, Cheltenham, UK and Northampton, MA, USA, 2009. Guibault, L. and S. van Gompel, ‘Collective Management in the European Union’, in Gervais, D. (ed.), Collective Management of Copyright and Related Rights, 2nd ed., Kluwer Law International, The Hague, 2010. Matulionytė, R. ‘Cross-border collective management and principle of territoriality: Problems and possible solutions in the EU’ (2008) The Journal of World Intellectual Property, 11 (5–6), 467–97. Mazziotti, G. ‘New licensing models for online music services in the European Union: From collective to customized management’ (2011) Columbia Journal of Law & the Arts, 34, 757. Mendez Pereira, M. ‘From discothèques to websites, a new approach to music copyright licensing: The simulcasting decision’, (2003) EC Competition Policy Newsletter, 44–9. Mestmäcker, E.-J. ‘Agreements of Reciprocal Representation of Collecting Societies in the Internal Market – The Related Rights of Phonogram Producers as a Test Case (Simulcasting)’, (2005) Revue Internationale du Droit d’Auteur, 63–137.

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CHAPTER 4 RELATIONS WITH USERS ARTICLE 16: LICENSING 1. 2.

3.

4.

Member States shall ensure that collective management organisations and users conduct negotiations for the licensing of rights in good faith. Collective management and users shall provide each other with all necessary information. Licensing terms shall be based on objective and non-discriminatory criteria. When licensing rights, collective management organisations shall not be required to use, as a precedent for other online services, licensing terms agreed with a user where the user is providing a new type of online service which has been available to the public in the Union for less than three years. Rightholders shall receive appropriate remuneration for the use of their rights. Tariffs for exclusive rights and rights to remuneration shall be reasonable in relation to, inter alia, the economic value of the use of the rights in trade, taking into account the nature and scope of the use of the work and other subject-matter, as well as in relation to the economic value of the service provided by the collective management organisation. Collective management organisations shall inform the user concerned of the criteria used for the setting of those tariffs. Collective management organisations shall reply without undue delay to requests from users, indicating inter alia the information needed in order for the collective management organisation to offer a licence. Upon receipt of all relevant information, the collective management organisation shall, without undue delay, either offer a licence or provide the user with a reasoned statement explaining why it does not intend to license a particular service. A collective management organisation shall allow users to communicate with it by electronic means, including, where appropriate, for the purpose of reporting on the use of the licence.

I. COMMENTARY 14.54 Article 16, together with Recital 31, on the relationship between collective management organisations and users focuses on two principles: (1) that collective management organisations and users conduct licensing negotiations in good faith; and (2) that collective management organisations apply tariffs determined on the basis of objective criteria. The obligation to negotiate in good faith is essential, but it does not necessarily guarantee that negotiations will run smoothly and that the outcome will be satisfactory to all parties, especially when the collective management organisation enjoys a strong bargaining position compared to that of the user. As a case in point let us mention the negotiations conducted between cultural heritage institutions and collective management organisations for the digitisation and dissemination of works in the collections of the former. Even if there is no reason to doubt that the parties act in good faith, the respective positions of the parties are so far apart that a satisfactory compromise is often out of reach, with a consequence that the works are not being used. 14.55 The requirement that the tariffs be determined on the basis of objective criteria is not an easy one to fulfil. This is probably the reason why the Directive refers to the notion of ‘economic value in trade ’. This criterion is put forward as a measure to be used for the determination of tariffs, whether these are in application of a voluntary licensing scheme, a right of remuneration or fair compensation. But such an economic value is utterly difficult to ascertain in practice, for many variables are likely to

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influence the determination.47 Quintais remarks rightly that the standard should in any event be interpreted with sufficient flexibility so as to accommodate the conceptual differences between the voluntary royalty, the right of equitable remuneration and the right of fair compensation.48 The EESC was of a similar opinion, where the report stated that with regard to voluntary licensing, the notion of ‘economic value of the rights’ is vague and possibly confusing. The Committee recommended requiring collective management organisations to disclose their tariff policies prior to any negotiations. Such policy should be based on criteria that are not only objective but also clear and transparent. However, the disclosure of a tariff policy should not prevent collective management organisations from offering commercial users a sliding scale of tariffs based on a new business model. The Committee recognised that since licensing is not always voluntary, the right of Member States to fix by law the level of the tariffs should be clarified in the Directive. But on this specific point, the Directive does not go so far. The Court of Justice examined the notion of ‘economic value of rights in trade’ in the context of the 14.56 STIM/Kanal 5 and TV4 case. In this case, the Court was asked to consider ‘whether the royalties levied by STIM are reasonable in relation to the economic value of the service provided by that organisation, which consists in making the repertoire of music protected by copyright that it manages available to the broadcasting companies which have concluded licensing agreements with it’.49 Those royalties, which represent the consideration paid for the use of musical works protected by copyright for the purposes of television broadcast, must, in particular, be analysed with respect to the value of that use in trade. In that connection, insofar as such royalties are calculated on the basis of the revenue of the television broadcasting societies, they are, in principle, reasonable in relation to the economic value of the service provided by STIM. The Court ruled that there is no abuse of a dominant position where, with respect to remuneration paid for the television broadcast of musical works protected by copyright, it applies to commercial television channels a remuneration model according to which the amount of the royalties corresponds partly to the revenue of those channels. This is on the condition that that part is proportionate overall to the quantity of musical works protected by copyright actually broadcast or likely to be broadcast, unless another method enables the use of those works and the audience to be identified more precisely without, however, resulting in a disproportionate increase in the costs incurred for the management of contracts and the supervision of the use of those works. The Court did rule, however, that by calculating the royalties with respect to remuneration paid for the broadcast of musical works in a different manner according to whether the companies concerned are commercial companies or public service undertakings, a copyright management organisation is likely to abuse its dominant position if it applies with respect to those companies dissimilar conditions to equivalent services and if it places them as a result at a competitive disadvantage, unless such a practice may be objectively justified.50 Discrimination in tarification between categories of users or origin of users has been judged in the 14.57 past to constitute an abuse of dominant position. For example, the Lucazeau and Tournier cases have established that where the royalties charged by collective management organisations to discothèques are appreciably higher than those charged in other Member States – the rates being compared on a consistent basis – these constitute an abuse of dominant position. This would not be the case if the collective management organisation in question were able to justify such a difference by reference to

47

48 49 50

See for example: P.B. Hugenholtz and D. Korteweg with the collaboration of J. Poort, Digitalisering van audiovisueel materiaal door erfgoedinstellingen: Modellen voor licenties en vergoedingen, onderzoek in opdracht van Beelden voor de Toekomst/Nederland Kennisland, April 2011. J.P. Quintais, ‘Proposal for a Directive on collective rights management and (some) multi-territorial licensing’, (2013) European Intellectual Property Review, 2, 65–73, 69. Case C52/07 Kanal 5 Ltd, TV 4 AB v STIM [2008] ECR I-09275, para. 29. Ibid., para. 48.

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objective and relevant dissimilarities between copyright management in the Member State concerned and copyright management in the other Member States.51 14.58 As mentioned above, paragraph 2 of Article 16 requires that licensing terms be set following objective and non-discriminatory criteria. In relation to this, the amendments brought to the text of the Directive operated a shuffle in the provisions, bringing Article 32 of the Proposal into Article 16(2) of the final text. This provision received its share of comments as being too vague. Recital 32 sheds some light on the somewhat obscure wording of the second sentence of paragraph 2. The Recital states that: In the digital environment, collective management organisations are regularly required to license their repertoire for totally new forms of exploitation and business models. In such cases, and in order to foster an environment conducive to the development of such licences, without prejudice to the application of competition law rules, collective management organisations should have the flexibility required to provide, as swiftly as possible, individualised licences for innovative online services, without the risk that the terms of those licences could be used as a precedent for determining the terms for other licences.

14.59 In its comment on the Proposal, the Max Planck Institute strongly recommended that the Commission introduce an obligation to contract with users, as such obligation exists in the laws of Austria, Germany, Greece, Poland and Spain.52 The final text of the Directive went a long way in this direction. Article 16(3) now requires collective management organisations to ‘reply without undue delay to requests from users, indicating inter alia the information needed in order for the collective management organisation to offer a licence.’ Upon receipt of all relevant information, the organisation must, without undue delay, either offer a licence or motivate a refusal.

NOTES 1. Related instruments EEC Treaty.

2. CJEU case law Joined Cases 110/88, 241/88 and 242/88 François Lucazeau and others v Société des Auteurs, Compositeurs et Editeurs de Musique (SACEM) and others (Joined Cases 110/88, 241/88 and 242/88) [1989] ECR 2811 Ministère public v Jean-Louis Tournier (Case 395/87) [1989] ECR 2521. Kanal 5 Ltd, TV 4 AB v STIM (Case C52/07) [2008] ECR I-09275.

3. Bibliography Hugenholtz, P.B. and D. Korteweg with the collaboration of J. Poort, Digitalisering van audiovisueel materiaal door erfgoedinstellingen: Modellen voor licenties en vergoedingen, onderzoek in opdracht van Beelden voor de Toekomst/Nederland Kennisland, April 2011. Max Planck Institute for Intellectual Property and Competition Law, Comments on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, Munich, 2012. Quintais, J.P. ‘Proposal for a Directive on Collective Rights Management and (Some) Multi-Territorial Licensing’, (2013) European Intellectual Property Review, 2, 65–73.

51 52

Case 395/87 Tournier; Joined Cases 110/88, 241/88 and 242/88 Lucazeau v Sacem [1989] ECR 2811. Max Planck Institute for Intellectual Property and Competition Law, 8.

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ARTICLE 18: INFORMATION PROVIDED TO RIGHTHOLDERS ON THE MANAGEMENT OF THEIR RIGHTS

ARTICLE 17: USERS’ OBLIGATIONS Member States shall adopt provisions to ensure that users provide a collective management organisation, within an agreed or pre-established time and in an agreed or pre-established format, with such relevant information at their disposal on the use of the rights managed by the collective management organisation as is necessary for the collection of rights revenue and for the distribution and payment of amounts due to rightholders. When deciding on the format for the provision of such information, collective management organisations and users shall take into account, as far as possible, voluntary industry standards.

I. COMMENTARY Article 17 of the Directive is an absolute novelty in the copyright acquis for it expressly puts an 14.60 obligation on users to report relevant information on the use of the rights managed by the collective management organisations. Recital 33 explains that: This obligation should not apply to natural persons acting for purposes outside their trade, business, craft or profession, who therefore fall outside the definition of user as laid down in this Directive. Moreover, the information required by collective management organisations should be limited to what is reasonable, necessary and at the users’ disposal in order to enable such organisations to perform their functions, taking into account the specific situation of small and medium-sized enterprises. That obligation could be included in an agreement between a collective management organisation and a user; this does not preclude national statutory rights to information. The deadlines applicable to the provision of information by users should be such as to allow collective management organisations to meet the deadlines set for the distribution of amounts due to rightholders. This Directive should be without prejudice to the possibility for Member States to require collective management organisations established in their territory to issue joint invoices.

NOTES 1. Related instruments See Related instruments at Arts 1 and 5.

2. Bibliography See Bibliography at Introduction.

CHAPTER 5 TRANSPARENCY AND REPORTING ARTICLE 18: INFORMATION PROVIDED TO RIGHTHOLDERS ON THE MANAGEMENT OF THEIR RIGHTS 1.

Without prejudice to paragraph 2 of this Article and Articles 19 and 28(2), Member States shall ensure that a collective management organisation makes available, not less than once a year, to each rightholder to whom it has attributed rights revenue or made payments in the period to which the information relates at least the following information: (a) any contact details which the rightholder has authorised the collective management organisation to use in order to identify and locate the rightholder; (b) the rights revenue attributed to the rightholder; (c) the amounts paid by the collective management organisation to the rightholder per category of rights managed and per type of use;

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(d) the period during which the uses took place for which amounts were attributed and paid to the rightholder, unless objective reasons relating to reporting by users prevent the collective management organisation from providing this information; (e) the deductions made in respect of management fees; (f) the deductions made for any purpose other than in respect of management fees, including those that may be required by national law for the provision of any social, cultural or educational services; (g) any rights revenue attributed to the rightholder which is outstanding for any period. Where a collective management organisation attributes rights revenue and has as members entities which are responsible for the distribution of rights revenue to rightholders, the collective management organisation shall provide the information listed in paragraph 1 to those entities, provided that they do not have that information in their possession. Member States shall ensure that the entities make at least the information listed in paragraph 1 available, not less than once a year, to each rightholder to whom they have attributed rights revenue or made payments in the period to which the information relates.

2.

ARTICLE 19: INFORMATION PROVIDED TO OTHER COLLECTIVE MANAGEMENT ORGANISATIONS ON THE MANAGEMENT OF RIGHTS UNDER REPRESENTATION AGREEMENTS Member States shall ensure that a collective management organisation makes at least the following information available, not less than once a year by electronic means, to the collective management organisations on whose behalf it manages rights under a representation agreement for the period to which the information relates: (a)

(b) (c) (d) (e)

the rights revenue attributed, the amounts paid by the collective management organisation per category of rights managed, and per type of use, for the rights it manages under the representation agreement, and any rights revenue attributed which is outstanding for any period; the deductions made in respect of management fees; deductions made for any purpose other than in respect of management fees as referred to in Article 15; information on any licences granted or refused with regard to works and other subjectmatter covered by the representation agreement; resolutions adopted by the general assembly of members in so far as those resolutions are relevant to the management of the rights under the representation agreement.

ARTICLE 20: INFORMATION PROVIDED TO RIGHTHOLDERS, OTHER COLLECTIVE MANAGEMENT ORGANISATIONS AND USERS ON REQUEST 1.

Without prejudice to Article 25, Member States shall ensure that, in response to a duly reasoned request, a collective management organisation makes at least the following information available by electronic means and without undue delay to any collective management organisation on whose behalf it manages rights under a representation agreement or to any rightholder or to any user:

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ARTICLE 22: ANNUAL TRANSPARENCY REPORT

(a) the works or other subject-matter it manages, the rights it manages, directly or under representation agreements, and the territories covered; or (b) where, due to the scope of activity of the collective management organisation, such works or other subject-matter cannot be determined, the types of works or of other subject-matter it manages, the rights it manages and the territories covered.

ARTICLE 21: DISCLOSURE OF INFORMATION TO THE PUBLIC 1.

2.

Member States shall ensure that a collective management organisation makes public at least the following information: (a) its statute; (b) its membership terms and the terms of termination of authorisation to manage rights, if these are not included in the statute; (c) standard licensing contracts and standard applicable tariffs, including discounts; (d) the list of the persons referred to in Article 10; (e) its general policy on distribution of the amounts due to rightholders; (f) its general policy on management fees; (g) its general policy on deductions other than in respect of management fees, from rights revenue and from any income arising from the investment of rights revenue, including deductions for the purposes of social, cultural and educational services; (h) a list of the representation agreements it has entered into, and the names of the collective management organisations with which those representation agreements have been concluded; (i) the general policy on the use of non-distributable amounts; (j) the complaint handling and dispute resolution procedures available in accordance with Articles 33, 34 and 35. The collective management organisation shall publish, and keep up to date, on its public website the information referred to in paragraph 1.

ARTICLE 22: ANNUAL TRANSPARENCY REPORT 1.

2. 3. 4.

53

Member States shall ensure that a collective management organisation, irrespective of its legal form under national law, draws up and makes public an annual transparency report, including the special report referred to in paragraph 3, for each financial year no later than eight months following the end of that financial year. The annual transparency report shall be signed by all directors. The collective management organisation shall publish on its website the annual transparency report which shall remain available to the public on that website for at least five years. The annual transparency report shall contain at least the information set out in the Annex. A special report shall address the use of the amounts deducted for the purposes of social, cultural and educational services and shall contain at least the information set out in point 3 of the Annex. The accounting information included in the annual transparency report shall be audited by one or more persons empowered by law to audit accounts in accordance with Directive 2006/43/EC of the European Parliament and of the Council.53

Directive 2006/43/EC of the European Parliament and of the Council of 17 May 2006 on statutory audits of annual accounts and consolidated account, amending Council Directives 78/660/EEC and 83/349/EEC and repealing Council Directive 84/253/EEC (OJ L 157, 9.6.2006, 87)

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The audit report, including any qualifications thereto, shall be reproduced in full in the annual transparency report. For the purposes of this paragraph, accounting information shall comprise the financial statements referred to in point 1 (a) of the Annex and any financial information referred to in points 1 (g) and (h) of point 1 and in point 2 of the Annex.

I. COMMENTARY 14.61 In its Resolution of 2004 the European Parliament54 expressed the wish ‘to see a graduated requirement for collective management societies to provide information, both internally and externally; calls, therefore, for the publication on the internet, as well as in other forms, of tariffs, distribution keys, annual accounts and information on reciprocal agreements’.55 The Parliament called for the: efficient exchange of information between collective management societies, and, as regards data confidentiality standards, for clear provision to be made for collective management societies to enjoy access to each other’s economic data and, furthermore, to seek audits with a view to ensuring that reciprocal representation agreements are properly applied and enhancing transparency in their management.56

The Parliament also supported the idea of gathering the necessary information about the substantive competence of collective management organisations, namely about their membership and who they manage, and about their competence ratione materiae, i.e. the works and other subject matter in their repertoire. Such sharing of information would constitute a further contribution to transparency, legal certainty and practical access to management. 14.62 As with the governance structure of collective management organisations, Articles 18–22 of the Directive introduce very detailed rules regarding the information to be provided to rightholders on the management of their rights, to other collective management organisations on the management of rights under representation agreements, and to rightholders, members, other collective management organisations and users on request, as well as the disclosure of information to the public and annual transparency report, respectively. The current copyright acquis contains no similar rules on transparency; these would be unique to the regime governing collective management organisations. 14.63 The new regime sets different information obligations on collective management organisations according to the categories of recipients of this information, e.g. rightholders, other collective management organisations, users and the general public. The group of recipients entitled to the least information, according to this section, is the general public. Remarkably, one element of information that should be most readily available to all is the repertoire and rights that each collective management organisation manages, together with the territorial coverage, as provided for in Article 20 in respect of all categories of recipients except the general public. The group that stands to benefit from access to this information is much broader than that listed in Article 20: it includes anyone wishing to provide services or to use material protected by copyright or related rights. Among them are developers of new content delivery platforms and services, and cultural heritage institutions. Because these (potential) services do not entertain a business relationship with the collective management organisations, they are disqualified as potential recipients of this information. Moreover, as the Communia association on the digital public domain pointed out in a reaction to the Proposal, such an exclusion appears in direct contradiction with the Directive

54 55 56

European Parliament, Resolution on a Community framework for collective management societies in the field of copyright and neighbouring rights (2002/2274(INI)), P5 TA(2004)0036, Strasbourg, 15 January 2004, 5, para. 51. Ibid, para. 56. Communia policy paper on the Directive proposal on Collective Management of Copyright, Brussels, 3.

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ARTICLE 23: MULTI-TERRITORIAL LICENSING IN THE INTERNAL MARKET

2012/28/EU on certain permitted uses of orphan works. The Directive lists in an Annex the sources to be consulted by cultural heritage institutions when carrying out a ‘diligent search’, making frequent reference to ‘the databases of relevant collecting societies’.57 The European legislator should strive at facilitating the conduct of ‘diligent searches’ under the Directive on certain permitted uses of orphan works through the establishment of effective transparency obligations of collective management organisations under this Directive.

NOTES 1. Related instruments Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044/104, 15.02.2013. Commission Staff Working Document Impact Assessment Accompanying the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online uses in the internal market, Brussels, 11.7.2012 SWD(2012) 204 final. Directive 2012/28/EU on certain permitted uses of orphan works, OJ L 299/5, 27 October 2012.

2. Bibliography Communia policy paper on the Directive proposal on Collective Management of Copyright, Brussels, 2012.

TITLE III MULTI-TERRITORIAL LICENSING OF ON-LINE RIGHTS IN MUSICAL WORKS BY COLLECTIVE MANAGEMENT ORGANISATIONS ARTICLE 23: MULTI-TERRITORIAL LICENSING IN THE INTERNAL MARKET Member States shall ensure that collective management organisations established in their territory comply with the requirements of this Title when granting multi-territorial licences for online rights in musical works.

I. COMMENTARY It is fair to say that the introduction of the Commission Recommendation 2005/737/EC of 18 May 14.64 2005 on collective cross-border management of copyright and related rights for legitimate online music services did not bring about the expected results: otherwise there would have been no need to legislate on the topic of cross-border online licensing of musical works through this Directive. Giving rightholders the right to entrust the management of any of the online rights necessary to operate legitimate online music services, on a territorial scope of their choice, to a collective rights manager of their choice, irrespective of the Member State of residence or the nationality of either the collective rights manager or the rightholder, was seen as the option most likely to introduce competition among collective rights managers at the level of rightholders, since they were no longer compelled to join exclusively the collective management organisation in their country of residence.

57

J. Drexl, ‘Competition in the field of collective management: Preferring “creative competition” to allocative efficiency in European copyright law’, in P.L.C. Torremans (ed.), Copyright law: A Handbook of Contemporary Research, Edward Elgar, Cheltenham, UK and Northampton, MA, USA, 2007, 277.

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Instead competition has evolved among a limited number of platforms that aggregate the repertoires of the cooperating partners,58 to the detriment of rightholders, smaller collective management organisations, and users. In fact, the majority of scholarly commentators, policy makers and stakeholders agree that the intention behind the Recommendation of fostering competition between individual collective management organisations has created chaos rather than anything else. 14.65 Title III of the Directive is meant to cure the uncertainty that the Recommendation has brought about since 2005 in the market for cross-border licensing for online uses of musical works. In the Explanatory Memorandum to the Proposal, the Commission explains that the proposed rules on multi-territorial licensing for online uses of musical works are limited to authors’ rights and are the minimum principles needed to make an effective and modern licensing system workable in the digital era and to guarantee the repertoire aggregation, including niche and less-known musical works. Appropriate safeguards are provided in this regard: e.g. a collective management organisation will have the choice as to whether to carry out the multi-territorial licensing of its repertoire itself or to entrust other organisations with it; also an author will not be locked in to an organisation which is unwilling either to grant multi-territorial licences directly or to allow another organisation to do so on its behalf.59 14.66 As Quintais observes, the option chosen for dealing with cross-border licensing of online musical works was an absolute novelty, in the sense that no Member State has implemented any comparable system.60 This system relies on the idea that, if a collective management organisation is not itself in a position to offer the multi-territory licensing of a global repertoire, it can follow the ‘passport’ option and allow another organisation to manage the rights on its repertoire on a multi-territorial basis. But as the Max Planck Institute report pointed out, the Proposal would put an end to the network of reciprocal representation agreements and the enhancement of competition among collective management organisations in the market for collective rights management services to rightholders for online music services.61 The report raised serious doubts as to the viability and desirability of the passport option, above other options. According to the authors of the report, the Proposal would not ‘remedy the fragmentation of repertoires which has been triggered by the Recommendation of 2005’.62 Be that as it may, the ‘passport’ option was maintained in the final text of the Directive.

ARTICLE 24: CAPACITY TO PROCESS MULTI-TERRITORIAL LICENCES 1.

2.

58 59 60 61 62

Member States shall ensure that a collective management organisation which grants multi-territorial licences for online rights in musical works has sufficient capacity to process electronically, in an efficient and transparent manner, data needed for the administration of such licences, including for the purposes of identifying the repertoire and monitoring its use, invoicing users, collecting rights revenue and distributing amounts due to rightholders. For the purposes of paragraph 1, a collective management organisation shall comply, at least, with the following conditions: Explanatory Memorandum to Proposal for a Directive on collective management, 8. Quintais, 70. Max Planck Institute for Intellectual Property and Competition Law, 27. Ibid., 32. Working Document on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, COM(2012)0372 – C7-0183/2012 – 2012/0180(COD), Committee on Legal Affairs, Rapporteur: Marielle Gallo, 4 March 2013.

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ARTICLE 26: ACCURACY OF MULTI-TERRITORIAL REPERTOIRE INFORMATION

(a) to have the ability to identify accurately the musical works, wholly or in part, which the collective management organisation is authorised to represent; (b) to have the ability to identify accurately, wholly or in part, with respect to each of relevant territory, the rights and their corresponding rightholders, for each musical work or share therein which the collective management organisation is authorised to manage; (c) to make use of unique identifiers in order to identify rightholders and musical works, taking into account, as far as possible, voluntary industry standards and practices developed at international or Union level; (d) to make use of adequate means in order to identify and resolve in a timely and effective manner inconsistencies in data held by other collective management organisations granting multi-territorial licences for online rights in musical works.

ARTICLE 25: TRANSPARENCY OF MULTI-TERRITORIAL REPERTOIRE INFORMATION 1.

2.

Member States shall ensure that a collective management organisation which grants multi-territorial licences for online rights in musical works provides to online music service providers, to rightholders whose rights it manages and to other collective management organisations, by electronic means, in response to a duly reasoned request, up-todate information allowing the identification of the online music repertoire it manages. This shall include: a. the musical works managed; b. the rights managed, wholly or in part; and c. the territories covered. The collective management organisation may take reasonable measures, where necessary, to protect the accuracy and integrity of the data, to control their re-use and to protect commercially sensitive information.

ARTICLE 26: ACCURACY OF MULTI-TERRITORIAL REPERTOIRE INFORMATION 1.

2.

Member States shall ensure that a collective management organisation which grants multi-territorial licences for online rights in musical works has in place arrangements to enable rightholders, other collective management organisations and online service providers to request a correction of the data referred to in the list of conditions under Article 24(2) or to information provided under Article 25, where such rightholders and collective management organisations and online service providers, on the basis of reasonable evidence, believe that the data or the information are inaccurate in respect of their online rights in musical works. Where the claims are sufficiently substantiated, the collective management organisation shall ensure that the data or the information are corrected without undue delay. The collective management organisation shall provide right holders whose musical works are included in its own music repertoire and rightholders who have entrusted the management of their online rights in musical works to it in accordance with Article 31 with the means of submitting to it in electronic form information concerning their musical works, their rights in those works and the territories in respect of which the rightholders authorise the organisation. When doing so, the collective management organisation and the rightholders shall take into account, as far as possible, voluntary industry standards or

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3.

practices regarding the exchange of data developed at international or Union level, allowing rightholders to specify the musical work, wholly or in part, the online rights, wholly or in part, and the territories, in respect of which they authorise the organisation. Where a collective management organisation mandates another collective management organisation to grant multi-territorial licences for the online rights in musical works under Articles 29 and 30, the mandated collective management organisation shall also apply paragraph 2 of this Article with respect to the rightholders whose musical works are included in the repertoire of the mandating collective management organisation, unless the collective management organisations agree otherwise.

ARTICLE 27: ACCURATE AND TIMELY REPORTING AND INVOICING 1. 2.

3.

4.

5.

Member States shall ensure that a collective management organisation monitors the use of online rights in musical works which it manages, wholly or in part, by online music service providers to which it has granted a multi-territorial licence for those rights. The collective management organisation shall offer online service providers the possibility of reporting by electronic means the actual use of online rights in musical works and online service providers shall accurately report the actual use of those works. The collective management organisation shall offer the use of a least one method of reporting which takes into account voluntary industry standards or practices developed at international or Union level for the electronic exchange of such data. The collective management organisation may refuse to accept reporting by the online service provider in a proprietary format if the organisation allows for reporting using an industry standard for the electronic exchange of data. The collective management organisation shall invoice the online service provider by electronic means. The collective management organisation shall offer the use of at least one format which takes into account voluntary industry standards or practices developed at international or Union level. The invoice shall identify the works and rights which are licensed, wholly or in part, on the basis of the data referred to in the list of conditions under Article 24(2), and the corresponding actual uses, to the extent that this is possible on the basis of the information provided by the online service provider and the format used to provide that information. The online service provider may not refuse to accept the invoice because of its format if the collective management organisation is using an industry standard. The collective management organisation shall invoice the online service provider accurately and without delay after the actual use of the online rights in that musical work is reported, except where this is not possible for reasons attributable to the online service provider. The collective management organisation shall have in place adequate arrangements enabling the online service provider to challenge the accuracy of the invoice, including when the online service provider receives invoices from one or more collective management organisations for the same online rights in the same musical work.

ARTICLE 28: ACCURATE AND TIMELY PAYMENT TO RIGHTHOLDERS 1.

Without prejudice to paragraph 3, Member States shall ensure that a collective management organisation which grants multi-territorial licences for online rights in musical works distributes amounts due to rightholders accruing from such licences accurately and

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2.

4.

without delay after the actual use of the work is reported, except where this is not possible for reasons attributable to the online service provider. Without prejudice to paragraph 3, the collective management organisation shall provide at least the following information to rightholders together with each payment it makes under paragraph 1: (a) the period during which the uses took place for which amounts are due to rightholders and the territories in which the uses took place; (b) the amounts collected, deductions made and amounts distributed by the collective management organisation for each online right in any musical work which rightholders have authorised the collective management organisation, wholly or in part, to represent; (c) the amounts collected for rightholders, deductions made, and amounts distributed by the collective management organisation in respect of each online service provider. Where a collective management organisation mandates another collective management organisation to grant multiterritorial licences for the online rights in musical works under Articles 29 and 30, the mandated collective management organisation shall distribute the amounts referred to in paragraph 1 accurately and without delay, and shall provide the information referred to in paragraph 2 to the mandating collective management organisation. The mandating collective management organisation shall be responsible for the subsequent distribution of such amounts and the provision of such information to rightholders, unless the collective management organisations agree otherwise.

I. COMMENTARY According to the European Parliament’s Committee on Legal Affairs,63 the greatest challenge in 14.67 the licensing of online uses of musical works was not so much the multi-territorial aspect of the licensing but the aggregation of a global repertoire that online music services can use. Articles 23–28, which are rather technical in nature, set out the conditions under which a collective management organisation may engage in multi-territorial licensing services. These conditions relate to their capacity to process licences, the obligation to ensure the transparency of multi-territorial repertoire information, to ensure the accuracy of this information, accurate and timely reporting and invoicing, as well as accurate and timely payment to rightholders. The EESC questioned the technical capability of many collective management organisations 14.68 currently operating in the EU to take on the management of multi-territorial licensing without difficulty. Another significant problem is repertoire aggregation. The Commission advocated a ‘European passport’, which in its opinion should significantly facilitate aggregation and, as a consequence, the granting of licences. This would make it possible in theory to ‘lay down common rules […] and would create competitive pressure on societies to develop more efficient licensing practices’. The EESC agreed with this approach. With regard to some of the proposed criteria for exempting small collective management organisations from multi-territorial licensing, the EESC noted a risk of market concentration which could distort competition to the detriment of smaller operators, for instance those in countries with small populations, or those belonging to certain national minorities, whose contribution to Europe’s cultures might call for specific support measures so that they can participate in the European licence market. The EESC believed that, due to these considerations of cultural diversity, in compliance with Article 107 TFEU, small collective

63

Working Document on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, COM(2012)0372 – C7-0183/2012 – 2012/0180(COD), Committee on Legal Affairs, Rapporteur: Marielle Gallo, 4 March 2013.

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management organisations in these countries should have access to public support, in order to be able to promote their catalogues directly throughout the EU and grant multi-territorial licences themselves.

NOTES 1. Related instruments Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044/104, 15.02.2013. Commission Staff Working Document Impact Assessment Accompanying the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online uses in the internal market, Brussels, 11.7.2012 SWD(2012) 204 final. European Parliament resolution of 25 September 2008 on collective cross-border management of copyright and related rights for legitimate online music services, P6_TA(2008)0462, [2010] OJ C 8E, 105. European Commission, Monitoring of the 2005 Music Online Recommendation, Brussels, 2008. European Parliament resolution of 13 March 2007 on the Commission Recommendation of 18 October 2005 on collective cross-border management of copyright and related rights for legitimate online music services (2005/737/ EC) (2006/2008(INI)), P6_TA(2007)0064, OJ C 301 E, 64 Commission Recommendation 2005/737/EC on Collective Cross-Border Management of Copyright and Related Rights for Legitimate Online Music Services, OJ L 276/54 of 21 October 2005. European Commission, Commission Staff Working Document – Study on a Community Initiative on the Cross-Border Collective Management of Copyright, Brussels, 7 July 2005.

2. CJEU case law Commission Decision of 16 July 2008 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case COMP/C2/38.698 – CISAC), C (2008) 3435 final, [2009] 4 CMLR 12. Commission Decision 2003/300/EC of 8 October 2002 relating to a proceeding under Article 81 of the EC Treaty and Article 53 of the EEA Agreement (Case No COMP/C2/38.014 – IFPI ‘Simulcasting’), OJ L 107/58 of 30.4.2003.

3. Bibliography Quintais, J.P. ‘Proposal for a Directive on Collective Rights Management and (Some) Multi-Territorial Licensing’, (2013) European Intellectual Property Review, 2, 65–73. Max Planck Institute for Intellectual Property and Competition Law, Comments on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, Munich, 2012.

ARTICLE 29: AGREEMENTS BETWEEN COLLECTIVE MANAGEMENT ORGANISATIONS FOR MULTI-TERRITORIAL LICENSING 1.

Member States shall ensure that any representation agreement between collective management organisations whereby a collective management organisation mandates another collective management organisation to grant multi-territorial licences for the online rights in musical works in its own music repertoire is of a non-exclusive nature. The mandated collective management organisation shall manage those online rights on a nondiscriminatory basis.

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ARTICLE 31: ACCESS TO MULTI-TERRITORIAL LICENSING

2. 3.

The mandating collective management organisation shall inform its members of the main terms of the agreement, including its duration and the costs of the services provided by the mandated collective management organisation. The mandated collective management organisation shall inform the mandating collective management organisation of the main terms according to which the latter’s online rights are to be licensed, including the nature of the exploitation, all provisions which relate to or affect the licence fee, the duration of the licence, the accounting periods and the territories covered.

ARTICLE 30: OBLIGATION TO REPRESENT ANOTHER COLLECTIVE MANAGEMENT ORGANISATION FOR MULTI-TERRITORIAL LICENSING 1.

2. 3.

4. 5. 6.

Member States shall ensure that where a collective management organisation which does not grant or offer to grant multi-territorial licences for the online rights in musical works in its own repertoire requests another collective management organisation to enter into a representation agreement to manage those rights, the requested collective management organisation is required to agree to such a request if it is already granting or offering to grant multi-territorial licences for the same category of online rights in musical works in the repertoire of one or more other collective management organisations. The requested collective management organisation shall respond to the requesting collective management organisation in writing and without undue delay. Without prejudice to paragraphs 5 and 6, the requested collective management organisation shall manage the represented repertoire of the requesting collective management organisation on the same conditions as those which it applies to the management of its own repertoire. The requested collective management organisation shall include the represented repertoire of the requesting collective management organisation in all offers it addresses to online service providers. The management fee for the service provided by the requested collective management organisation to the requesting organisation shall not exceed the costs reasonably incurred by the requested collective management organisation. The requesting collective management organisation shall make available to the requested collective management organisation the information relating to its own music repertoire required for the provision of multi-territorial licences for online rights in musical works. Where information is insufficient or provided in a form that does not allow the requested collective management organisation to meet the requirements of this Title, the requested collective management organisation shall be entitled to charge for the costs reasonably incurred in meeting such requirements or to exclude those works for which information is insufficient or cannot be used.

ARTICLE 31: ACCESS TO MULTI-TERRITORIAL LICENSING Member States shall ensure that where a collective management organisation does not grant or offer to grant multi-territorial licences for online rights in musical works or does not allow another collective management organisation to manage those rights for such purpose by 10 April 2017, rightholders who have authorised that collective management organisation to manage their online rights in musical works can withdraw from that collective management organisation the online rights in musical works for the purposes of multi-territorial licensing in respect of all

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territories without having to withdraw the online right in musical works for the purposes of mono-territorial licensing, so as to grant multi-territorial licences for their online rights in musical works themselves or through any other party they authorise or through any collective management organisation complying with the provision of this Title.

I. COMMENTARY 14.69 Should a collective management organisation not be able to meet the requirements of Articles 23–28 and be able itself to grant multi-territorial licences to online music service providers, the second option to guarantee the grant of multi-territorial, multi-repertoire licences is to follow the ‘passport’ route. The ‘passport’ consists in one collective management organisation granting a non-exclusive mandate of representation to another organisation that is indeed capable of fulfilling the criteria for exploitation. According to the Commission, the ‘passport’ regime set out in Articles 29–31 would confer more protection to small- and medium-size organisations by guaranteeing the inclusion of their repertoires within the scope of the multi-territorial licences issued by the mandated organisations. The regime would provide that multi-territorial licences granted to users by a mandated organisation effectively include and cover the repertoire of the mandating organisation. At the same time, the mandated organisation would apply to the repertoire of the mandating organisation the same conditions that apply to its own repertoire. For the ‘passport’ regime to be fair, the mandated organisation would also obtain the consent from the mandating organisation before excluding any repertoires from the scope of its licences with users. This aspect is important since non-compliance with the ‘passport’ requirements would deprive a collective management organisation of the right to promote and directly license its own repertoire on a multi-territorial basis and would oblige such an organisation to accept the licensing conditions set out by the mandated organisation. 14.70 The two most important provisions in this section are Articles 30 and 31. The first one lays an obligation on a ‘passport holder’ to represent another collective management organisation for multi-territorial licensing. Upon request from a collective management organisation that does not offer such services for rights in musical works in its own repertoire, a passport holder is obligated to enter into a representation agreement to represent those rights. If the requested organisation already offers such services to one or more other collective management organisations, it may not refuse to accept the request. In the opinion of the EESC, the language of Article 30(1) of the Proposal could have been clearer in terms of the obligation of the passport entity.64 More importantly, the Max Planck Institute’s comment pointed to a number of potential problems that could arise from the application of the provision. Among the challenges would be the situation where the author and the publisher have initially entrusted their rights to two different collective management organisations. In such circumstances, the network of reciprocal representation agreements would still be needed to clear the rights.65 As a result of these comments, the text of the Directive was improved. The potential difficulty raised by the Max Planck Institute was addressed by increasing the information obligation of the mandated organisation to the mandating organisation with respect, inter alia, to the repertoire and rights owners it manages. 14.71 Article 31 completes the previous provision by requiring that Member States ensure that rightholders be allowed to grant multi-territorial licences in their online rights themselves or through any

64

65

Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044, 15.02.2013 para. 4.19. Max Planck Institute for Intellectual Property and Competition Law, 28.

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ARTICLE 32: DEROGATION FOR ONLINE MUSIC RIGHTS REQUIRED FOR RADIO AND TELEVISION

collective management organisation complying with the criteria of the Directive, insofar as their own collective management organisation does not engage in the multi-territorial licensing of online rights in their own repertoire. The possibility of direct licensing without withdrawal of mandates by rightholders – foreseen under Article 31 of the Directive in the (unlikely) event that their collective management organisation does not grant multiterritorial licences (directly or through the passport mechanism) – contradicts the principle of exclusivity in the assignments of rights in favour of the initial collective management organisation.66 The Max Planck Institute report highlighted yet again several areas of uncertainty in the application of this provision. For example, Article 31 presupposes that it can always clearly be ascertained, who from the author or the publisher, has entrusted a collective management organisation with the online rights. In reality, this is often far from obvious, with as a result that both the author and the publisher may attempt to claim the online rights on the work. This may prove very disadvantageous to authors, since publishers are more likely to seek a centralised grant of cross-border licences, while authors will tend to follow the more familiar route of their own collective management organisation requesting the passport option by another society.67 Although the final text of Article 31 was improved, the main concerns voiced by the authors of the Max Planck commentary have not been taken away.

NOTES 1. Related instruments Draft Opinion of the Committee on the Internal Market and Consumer Protection for the Committee on Legal Affairs on the proposal for a directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market (COM(2012)0372 – C7-0183/2012 – 2012/0180(COD)) 26 March 2013. Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044/104, 15.02.2013. Commission Staff Working Document Impact Assessment Accompanying the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multiterritorial licensing of rights in musical works for online uses in the internal market, Brussels, 11.7.2012 SWD(2012) 204 final.

2. Bibliography Quintais, J.P. ‘Proposal for a Directive on Collective Rights Management and (Some) Multi-Territorial Licensing’, (2013) European Intellectual Property Review, 2, 65–73. Max Planck Institute for Intellectual Property and Competition Law, Comments on the Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market, Munich, 2012.

ARTICLE 32: DEROGATION FOR ONLINE MUSIC RIGHTS REQUIRED FOR RADIO AND TELEVISION PROGRAMMES The requirements under this Title shall not apply to collective management organisations when they grant, on the basis of the voluntary aggregation of the required rights, in compliance with the competition rules under Articles 101 and 102 TFEU, a multi-territorial licence for the online

66 67

GESAC commentary, Copyright Law in the EU Digital Single Market Workshop, Brussels, 14 November 2012, 3. Max Planck Institute for Intellectual Property and Competition Law, 29.

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rights in musical works required by a broadcaster to communicate or make available to the public its radio or television programmes simultaneously with or after their initial broadcast as well as any online material, including previews, produced by or for the broadcaster which is ancillary to the initial broadcast of its radio or television programme.

I. COMMENTARY 14.72 The rationale behind this exemption is explained in Recital 48, which states that: Broadcasting organisations generally rely on a licence from a local collective management organisation for their own broadcasts of television and radio programmes which include musical works. That licence is often limited to broadcasting activities. A licence for online rights in musical works would be required in order to allow such television or radio broadcasts to be also available online. To facilitate the licensing of online rights in musical works for the purposes of simultaneous and delayed transmission online of television and radio broadcasts, it is necessary to provide for a derogation from the rules that would otherwise apply to the multi-territorial licensing of online rights in musical works. Such a derogation should be limited to what is necessary in order to allow access to television or radio programmes online and to material having a clear and subordinate relationship to the original broadcast produced for purposes such as supplementing, previewing or reviewing the television or radio programme concerned. That derogation should not operate so as to distort competition with other services which give consumers access to individual musical or audiovisual works online, nor lead to restrictive practices, such as market or customer sharing, which would be in breach of Articles 101 or 102 TFEU.

NOTES 1. Related instruments Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044/104, 15.02.2013.

TITLE IV ENFORCEMENT MEASURES ARTICLE 33: COMPLAINTS PROCEDURE 1.

2.

Member States shall ensure that collective management organisations make available to their members, and to collective management organisations on whose behalf they manage rights under a representation agreement, effective and timely procedures for dealing with complaints, particularly in relation to authorisation to manage rights and termination or withdrawal of rights, membership terms, the collection of amounts due to rightholders, deductions and distributions. Collective management organisations shall respond in writing to complaints by members or by collective management organisations on whose behalf they manage rights under a representation agreement. Where the collective management organisation rejects a complaint, it shall give reasons.

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ARTICLE 35: DISPUTE RESOLUTION

ARTICLE 34: ALTERNATIVE DISPUTE RESOLUTION PROCEDURES 1.

2.

Member States may provide that disputes between collective management organisations, members of collective management organisations, rightholders or users regarding the provisions of national law adopted pursuant to the requirements of this Directive can be submitted to a rapid, independent and impartial alternative dispute resolution procedure. Member States shall ensure, for the purposes of Title III, that the following disputes relating to a collective management organisation established in their territory which grants or offers to grant multi-territorial licences for online rights in musical works can be submitted to an independent and impartial alternative dispute resolution procedure: (a) disputes with an actual or potential online service provider regarding the application of Articles 16, 25, 26 and 27; (b) disputes with one or more rightholders regarding the application of Articles 25, 26, 27, 28, 29, 30 and 31; (c) disputes with another collective management organisation regarding the application of Articles 25, 26, 27, 28, 29 and 30.

ARTICLE 35: DISPUTE RESOLUTION 1.

2.

Member States shall ensure that disputes between collective management organisations and users concerning, in particular, existing and proposed licensing conditions or a breach of contract can be submitted to a court, or if appropriate, to another independent and impartial dispute resolution body where that body has expertise in intellectual property law; Articles 33 and 34 and paragraph 1 of this Article shall be without prejudice to the rights of the parties to assert and defend their rights by bringing an action before a court.

I. COMMENTARY Articles 33, 34 and 35 of the Directive have been thoroughly revised and amended compared to the 14.73 text of the Proposal. Where the Recommendation of 2005 merely invited Member States to provide for ‘effective dispute resolution mechanisms, in particular in relation to tariffs, licensing conditions, entrustment of online rights for management and withdrawal of online rights’, Articles 33, 34 and 35 of the Directive contain a series of provisions setting out a comprehensive system of dispute resolution. Recital 49 stresses the importance of establishing a proper alternative dispute resolution procedure, which ensures a rapid, independent and impartial out-of-court procedure for resolving conflicts between collective management organisation, their members, rightholders or users regarding the provisions of national law adopted pursuant to the Directive. Article 33 requires Member States to ensure that collective management organisations make a 14.74 complaint mechanism available to their members and to mandating collective management organisations. The procedure must, at least, be able to address complaints involving in particular the authorisation to manage rights and the termination or withdrawal of rights, membership terms, the collection of amounts due, deductions and distributions. Article 34, in turn, deals with alternative dispute resolution mechanisms between collective management organisations, between a collective management organisation and its members, rightholders or users. This procedure is without prejudice to judicial action. In the same vein, Article 35 of the Directive governs the resolution disputes between collective management organisations and users, concerning in particular, existing and proposed licensing conditions or a breach of contract. Most importantly, parties involved in a

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dispute should have the possibility of easily accessible, efficient and impartial out-of-court procedures, such as mediation or arbitration, for resolving conflicts.

NOTES 1. Related instruments Opinion of the European Economic and Social Committee on the ‘Proposal for a Directive of the European Parliament and of the Council on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online uses in the internal market’ COM(2012) 372 final – 2012/0180 (COD), OJ C 044/104, 15.02.2013.

ARTICLE 36: COMPLIANCE 1.

2.

3.

Member States shall ensure that compliance by collective management organisations established in their territory with the provisions of national law adopted pursuant to the requirements laid down in this Directive is monitored by competent authorities designated for that purpose. Member States shall ensure that procedures exist enabling members of a collective management organisation, rightholders, users collective management organisations and other interested parties to notify the competent authorities designated for that purpose of activities or circumstances which, in their opinion, constitute a breach of the provisions of national law adopted pursuant to the requirements laid down in this Directive. Member States shall ensure that the competent authorities designated for that purpose have the power to impose appropriate sanctions or to take appropriate measures where the provisions of national law adopted in implementation of this Directive have not been complied with. Those sanctions and measures shall be effective, proportionate and dissuasive. Member States shall notify the Commission of the competent authorities referred to in this Article and in Articles 37 and 38 by 10 April 2016. The Commission shall publish the information received in that regard.

ARTICLE 37: EXCHANGE OF INFORMATION BETWEEN COMPETENT AUTHORITIES 1.

2.

In order to facilitate the monitoring of the application of this Directive, each Member State shall ensure that a request for information received from a competent authority of another Member State, designated for that purpose, concerning matters relevant to the application of this Directive, in particular with regard to the activities of collective management organisations established in their territory, is responded to without undue delay by the competent authority designated for that purpose, provided that the request is duly justified. Where a competent authority considers that a collective management organisation established in another Member State but acting within its territory may not be complying with the provisions of the national law of the Member State in which that collective management organisation is established which have been adopted pursuant to the requirements laid down in this Directive, it may transmit all relevant information to the competent

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ARTICLE 37: EXCHANGE OF INFORMATION BETWEEN COMPETENT AUTHORITIES

3.

authority of the Member State in which the collective management organisation is established, accompanied where appropriate by a request to that authority that it take appropriate action within its competence. The requested competent authority shall provide a reasoned reply within three months. Matters as referred to in paragraph 2 may also be referred by the competent authority making such a request to the expert group established in accordance with Article 41.

I. COMMENTARY Together with the reporting duties imposed on Member States and competent authorities pursuant 14.75 to Articles 37 and 38, Article 36 on Compliance is a major improvement over the text of the Proposal towards the real implementation in practice of the principles laid down in the Directive. Paragraph 2 of this Article in particular gives teeth to the system put in place by the Directive by requiring Member States to ensure that the competent authorities have the power to impose the appropriate sanctions and measures to guarantee compliance by collective management organisations with the national implementation of the norms in this Directive. Article 36 should be read in conjunction with Recital 50, which emphasises that: While it is not appropriate for this Directive to restrict the choice of Member States as to competent authorities, nor as regards the ex-ante or ex-post nature of the control over collective management organisations, it should be ensured that such authorities are capable of addressing in an effective and timely manner any concern that may arise in the application of this Directive.

Interestingly, Recital 50 specifies that Member States are not obliged to set up new competent 14.76 authorities. But at the same time, the Recital goes on to state that ‘it should also be possible for members of a collective management organisation, rightholders, users, collective management organisations and other interested parties to notify a competent authority in respect of activities or circumstances which, in their opinion, constitute a breach of law by collective management organisations and, where relevant, users.’ Member States follow vastly diverging routes in respect of the supervision of the collective management organisations that are active on their territory, ranging from a strict supervisory organisation to a ‘de minimis’ type of control system. While Member States are under no obligation to set up a new competent authority, they should at least make sure that there is one qualified body entrusted with this task. Otherwise, how can interested parties file a complaint for failure of a collective management organisation to comply with the provisions flowing from the Directive, if there is no proper system in place to receive such complaint? A definition of ‘competent authority’ might have been useful. Former Article 37 of the Proposal did require Member States to take all the necessary measures to 14.77 ensure that the complaints procedures are administered by the competent authorities empowered to ensure compliance with the provisions of national law adopted pursuant to the requirements laid down in this Directive. This Article was complemented by a former version of Recital 50, which read as follows: Member States should establish appropriate procedures by means of which it will be possible to make complaints against collecting societies who do not comply with the law and to ensure that, where appropriate, effective, proportionate and dissuasive sanctions are imposed. Member States should determine which authorities should be responsible for administering the complaints procedures and sanctions. To ensure that the requirements for multi-territorial licensing are complied with, specific provisions on the monitoring of their implementation should be laid down. The competent authorities of the Member States and the European Commission should cooperate with each other to this end.

The Proposal therefore demanded that each country designate a specific authority responsible for the enforcement of the ‘European standards’ set out therein. In the light of the EU principles of

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subsidiarity and proportionality, the Parliaments of France and Luxemburg expressed objections with respect to this provision of the Proposal, e.g. to the requirement that each country appoint an independent authority specifically to ensure that the standards introduced by this Proposal for a Directive are applied. According to the two legislatures, it would be more consistent with the subsidiarity principle to respect the Member States’ internal organisation by allowing a diversity of national models for monitoring such standards. In France and Luxembourg, for example, according to the current model, the judge has the power to exercise this control.68 The provision was therefore amended in the current text. 14.78 As Recital 50 further specifies competent authorities should be given the power to impose sanctions or measures where provisions of national law implementing this Directive are not complied with. Just as no specific requirements are imposed regarding the establishment of a compentent authority, no specific rules are set regarding the specific types of sanctions or measures to be adopted, provided that they are effective, proportionate and dissuasive. Such sanctions or measures may include orders to dismiss directors who have acted negligently, inspections at the premises of a collective management organisation or, in cases where an authorisation is issued for an organisation to operate, the withdrawal of such authorisation. Moreover, the Directive is neutral as regards the prior authorisation and supervision regimes in the Member States, including a requirement for the representativeness of the collective management organisation, insofar as those regimes are compatible with Union law and do not create an obstacle to the full application of this Directive. This last remark concerning the requirements of prior approval and supervision regimes may perhaps be explained by the need to observe the prescriptions of the Services Directive.

NOTES 1. Bibliography L. Guibault and S. van Gompel, ‘Collective Management in the European Union’, in Daniel Gervais (ed.), Collective Management of Copyright and Related Rights, The Hague, Kluwer Law International, 2006, Ch. IV, 117–52.

ARTICLE 38: COOPERATION FOR THE DEVELOPMENT OF MULTI-TERRITORIAL LICENSING 1. 2.

3.

68

The Commission shall foster regular exchange of information between the competent authorities designated for that purpose in Member States, and between those authorities and the Commission, on the situation and development of multi-territorial licensing. The Commission shall conduct regular consultations with representatives of rightholders, collective management organisations, users, consumers and other interested parties on their experience with the application of the provisions of Title III of this Directive. The Commission shall provide competent authorities with all relevant information that emerges from those consultations, within the framework of the exchange of information provided for in paragraph 1. Member States shall ensure that by 10 October 2017, their competent authorities provide the Commission with a report on the situation and development of multi-territorial licensing in their territory. The report shall include information on, in particular, the

European Parliament, Committee on Legal Affairs, 26 October 2012, Committee on Legal Affairs, Notice to Members from France; European Parliament, Committee on Legal Affairs, 7 November 2012, Committee on Legal Affairs, Notice to Members from Luxembourg.

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ARTICLE 39: NOTIFICATION OF COLLECTIVE MANAGEMENT ORGANISATIONS

4.

availability of multi-territorial licences in the Member State concerned and compliance by collective management organisations with the provisions of national law adopted in implementation of Title III of this Directive, together with an assessment of the development of multi-territorial licensing of online rights in musical works by users, consumers, rightholders and other interested parties. On the basis of the reports received pursuant to paragraph 3 and the information gathered pursuant to paragraphs 1 and 2, the Commission shall assess the application of Title III of this Directive. If necessary, and where appropriate on the basis of a specific report, it shall consider further steps to address any identified problems. That assessment shall cover, in particular, the following: (a) the number of collective management organisations meeting the requirements of Title III; (b) the application of Articles 29 and 30, including the number of representation agreements concluded by collective management organisations pursuant to those Articles; (c) the proportion of repertoire in the Member States which is available for licensing on a multi-territorial basis.

TITLE V REPORTING AND FINAL PROVISIONS ARTICLE 39: NOTIFICATION OF COLLECTIVE MANAGEMENT ORGANISATIONS By 10 April 2016, Member States shall provide the Commission, on the basis of the information at their disposal, with a list of the collective management organisations established in their territories. Member States shall notify any changes to that list to the Commission without undue delay. The Commission shall publish that information and keep it up to date.

I. COMMENTARY This Article 39 is a useful addition to the final text of the Directive in order to allow the European 14.79 Commission to effectively monitor the activities of all collective management organisations established in the territory of the European Union. Where the landscape of collective management organisations is generally speaking rather stable in the EU, it is not excluded that new organisations may be set up to represent the interests of rights owners that were until then not collectively managed, or that existing organisations undergo such important restructuring as to give rise to a new organisation, either because of a division in the membership or in the rights or categories of rights managed. It is each Member State’s task to keep track of such changes and to forward the information to the Commission.

NOTES 1. Related instruments See Related instruments at Arts 1 and 5.

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2. Bibliography See Bibliography at Introduction.

ARTICLE 40: REPORT By 10 April 2021, the Commission shall assess the application of this Directive and submit to the European Parliament and to the Council a report on the application of this Directive. That report shall include an assessment of the impact of this Directive on the development of cross-border services, on cultural diversity, on the relations between collective management organisations and users and on the operation in the Union of collective management organisations established outside the Union, and, if necessary, on the need for a review. The Commission’s report shall be accompanied, if appropriate, by a legislative proposal.

ARTICLE 41: EXPERT GROUP An expert group is hereby established. It shall be composed of representatives of the competent authorities of the Member States. The expert group shall be chaired by a representative of the Commission and shall meet either on the initiative of the chairman or at the request of the delegation of a Member State. The tasks of the group shall be as follows: (a) (b) (c)

to examine the impact of the transposition of this Directive on the functioning of collective management organisations and independent management entities in the internal market, and to highlight any difficulties; to organise consultations on all questions arising from the application of this Directive; to facilitate the exchange of information on relevant developments in legislation and case-law, as well as relevant economic, social, cultural and technological developments, especially in relation to the digital market in works and other subject-matter.

I. COMMENTARY 14.80 Contrary to other Directives (e.g. Database and Information Society Directives), the delay for reporting on the application of the Directive and its impact on the development of cross-border services and on cultural diversity would not be three, but seven years. In view of the difficulties experienced in the past with respect to the reporting on the application and impact of previous Directives, a delay of seven years for reporting on the transposition measures and their impact probably seemed more realistic to the drafters, than the three years normally required. Concerning this reporting obligation, Recital 57 declares that: […] Member States have undertaken to accompany, in justified cases, the notification of their transposition measures with one or more documents explaining the relationship between the components of a directive and the corresponding parts of national transposition instruments. With regard to this Directive, the legislator considers the transmission of such documents to be justified.

14.81 Also contrary to other Directives in the field of copyright and related rights, this Directive is the first one to mandate the creation of an expert group to assess the impact of this Directive on the development of cross-border services, on cultural diversity, on the relations between collective management organisations and users and on the operation in the Union of collective management organisations established outside the Union, and, if necessary, on the need for a review. This is a

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ARTICLE 43: TRANSPOSITION

useful feature of the Directive for it ensures that when the time comes, the people most knowledgeable in the area will be called upon to participate in the review process.

ARTICLE 42: PROTECTION OF PERSONAL DATA The processing of personal data carried out within the framework of this Directive shall be subject to Directive 95/46/EC.

I. COMMENTARY Article 42 should be read in conjunction with Recital 52 which emphasises the importance for 14.82 collective management organisations to respect the rights to private life and personal data protection of any rightholder, member, user and other individual whose personal data they process. Directly referring to Directive 95/46/EC which governs the processing of personal data carried out in the Member States, Recital 52 goes on to state that ‘rightholders should be given appropriate information about the processing of their data, the recipients of those data, time limits for the retention of such data in any database, and the way in which rightholders can exercise their rights to access, correct or delete their personal data concerning them in accordance with Directive 95/46/EC. In particular, unique identifiers which allow for the indirect identification of a person should be treated as personal data within the meaning of that Directive’. Recital 52 is further complemented by Recital 40, which states that ‘Provisions on enforcement measures should be without prejudice to the competencies of national independent public authorities established by the Member States pursuant to Directive 95/46/EC to monitor compliance with national provisions adopted in implementation of that Directive’. For the sake of completeness and transparency, Recital 58 declares that ‘The European Data Protection Supervisor was consulted in accordance with Article 28(2) of Regulation (EC) No 45/2001 of the European Parliament and of the Council69 and delivered an opinion on 9 October 2012. It must be noted that Directive 95/46/EC is no longer in force and is now replaced by Regulation 2016/679.70

ARTICLE 43: TRANSPOSITION 1.

2.

69

70

Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 10 April 2016. They shall immediately inform the Commission thereof. When Member States adopt those measures, they shall contain a reference to this Directive or shall be accompanied by such a reference on the occasion of their official publication. The methods of making such reference shall be laid down by Member States. Member States shall communicate to the Commission the text of the main measures of national law which they adopt in the field covered by this Directive.

Regulation (EC) No 45/2001 of the European Parliament and of the Council of 18 December 2000 on the protection of individuals with regard to the processing of personal data by the Community institutions and bodies and on the free movement of such data (OJ L 8, 12.1.2001, 1). Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (Text with EEA relevance) (OJ L 119, 4.5.2016, 1–88).

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ARTICLE 44: ENTRY INTO FORCE This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

ARTICLE 45: ADDRESSEES This Directive is addressed to the Member States.

I. COMMENTARY 14.83 Articles 43–45 of the Directive set out the delay for transposition into the national legal order, the time of entry into force of the Directive and the addressees of the Directive. These provisions exist in all intellectual property Directives. In line with the transposition delays set in some of the previous Directives in the field of copyright and related rights, Member States are given a period of 24 months to implement this Directive in their national laws. The delay for implementation first put forward in the Proposal was set at an unusally short period of 12 months from adoption of the Directive. Knowing that the national legislatures of 28 Member States will have to proceed to the implementation of this Directive, and knowing how prone to sudden disruptances the legislative process is, one year did seem unreasonably short and was therefore increased by a year. 14.84 Finally Article 45 states that the Directive is addressed to Member States. This may seem superfluous in the context of the adoption of secondary legislation for the European Union, but it is good to realise that, contrary to the Commission Recommendation 2005/737/EC which was addressed to all stakeholders involved in the cross-border licensing of online musical works, the implementation of the obligations flowing from this instrument is the sole responsibility of the Member States. Member States will be held accountable if the provisions of national law implementing this Directive are not complied with.

NOTES 1. Related instruments See Related instruments at Arts 1 and 5.

2. Bibliography See Bibliography at Introduction.

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15 THE PORTABILITY REGULATION Katja Weckström Lindroos and Nguyen Ho Bich Hang REGULATION (EU) 2017/1128 of the European Parliament and of the Council of 14 June 2017 on cross-border portability of online content services in the internal market [2017] OJ L 168/1

CORRIGENDUM TO REGULATION (EU) 2017/1128 of the European Parliament and of the Council of 14 June 2017 on cross-border portability of online content services in the internal market Corrigendum [2017] OJ L 198/42

I.

GENERAL REMARKS

15.01

I.

ARTICLE 1: SUBJECT MATTER AND SCOPE I.

COMMENTARY 1. Subject matter 2. Scope

15.04 15.04 15.06

ARTICLE 2: DEFINITIONS I.

COMMENTARY 1. Subscriber 2. Consumer 3. Member State of residence 4. Temporarily present in a Member State 5. Online content service 6. Portable

15.09 15.09 15.10 15.11 15.12 15.14 15.16

ARTICLE 3: OBLIGATION TO ENABLE CROSSBORDER PORTABILITY OF ONLINE CONTENT SERVICES I.

COMMENTARY 1. In the same manner 2. Any additional charges 3. Quality of service 4. Providing information

ARTICLE 4: LOCALISATION OF THE PROVISION OF, ACCESS TO AND USE OF ONLINE CONTENT SERVICES I.

COMMENTARY

15.26

ARTICLE 5: VERIFICATION OF THE MEMBER STATE OF RESIDENCE

15.27 15.27 15.28 15.31 15.32 15.33

ARTICLE 6: CROSS-BORDER PORTABILITY OF ONLINE CONTENT SERVICES PROVIDED WITHOUT PAYMENT OF MONEY I.

COMMENTARY 1. General 2. Scope 3. Information

15.34 15.34 15.35 15.36

ARTICLE 7: CONTRACTUAL PROVISIONS I.

15.17 15.18 15.21 15.22 15.24

COMMENTARY 1. Means of verification 2. Reasonable doubts 3. Information necessary 4. Authorization 5. Withdrawing authorization

COMMENTARY 1. General scope 2. Effect of contractual provisions 3. Scope of regulation

15.37 15.37 15.40 15.41

ARTICLE 8: PROTECTION OF PERSONAL DATA I.

COMMENTARY 1. Collecting data 2. Use of data 3. Destroying data

15.42 15.42 15.43 15.44

ARTICLE 9: APPLICATION TO EXISTING CONTRACTS AND RIGHTS ACQUIRED I.

COMMENTARY 1. Application

15.45 15.45

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Chapter 15 THE PORTABILITY REGULATION 2. Transition

15.46

I.

COMMENTARY

ARTICLE 11: FINAL PROVISIONS I.

ARTICLE 10: REVIEW

COMMENTARY

15.48

15.47

I. GENERAL REMARKS 15.01 The Portability Regulation is part of the normative package designed to promote the realization of the Digital Single Market in the EU. The Digital Single Market Strategy for Europe aims at ensuring the free movement of goods, persons, services and capital, and seamless access to and exercise of online activities irrespective of nationality or place of residence, for individuals and businesses under conditions of fair competition.1 Travelling within the EU is an indispensable part of the daily lives of many European citizens. The Portability Regulation aims to allow European citizens to travel with their online content services without limiting access through geo-blocking.2 Geo-blocking practices stem from contractual provisions between online content service providers and owners of content, such as music, podcasts, radio programmes, e-books or audiovisual media content. All services, whose main feature is the provision of online content to consumers, whether free or for payment, are online content service providers within the meaning of the Portability Regulation. The Portability Regulation applies to services that provide access to or use of digital content that is protected by copyright, related rights or contract. In particular, online content service provider refers to broadcasters or providers of on-demand services of audiovisual media content, including films, series, news, sports or programming intended to inform, educate or entertain.3 Such programmes and other online content are usually protected by copyright or related rights under EU or national law and licensed for use on the basis of territory.4 In practice, territorial limitations in licensing contracts transfer to end-user agreements restricting access to certain online services, when travelling to another EU Member State. Ensuring subscribers’ access to content, when they are temporarily present in a Member State other than their Member State of residence, protects the rights of legitimate users of these online services. Neither physical borders nor technological protection measures should stop subscribers from accessing the online content that they have paid for. The Portability Regulation invalidates legal or technological measures that block access, thus guaranteeing cross-border portability of online content to private persons who are subscribers of online content media services.5 It shifts practices to identification of legitimate users rather than legitimate locations of access to content. 15.02 Normatively, the Portability Regulation is based on primary EU law and intersects with several pieces of secondary EU law; namely the Geo-Blocking Regulation,6 the Audiovisual Media Services 1 2

3

4

5

6

Communication from the Commission to the European Parlieament, the Council, the European Economic and Social Committee and the Committee of Regions, COM (2015) 192 final. Regulation (EU) 2018/302 of the European Parliament and of the Council of 28 February 2018 on addressing unjustified geo-blocking and other forms of discrimination based on customers’ nationality, place of residence or place of establishment within the internal market and amending Regulations (EC) No 2006/2004 and (EU) 2017/2394 and Directive 2009/22/EC, [2018] OJ L 601/1, (Geo-Blocking Regulation), Recital 1. Directive 2010/13/EU of the European Parliament and of the Council of 10 March 2010 on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the provision of audiovisual media services (Text with EEA relevance), [2010] OJ L 95/1 (Audiovisual Media Services Directive), Art. 1. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, [2001] OJ L 167/10 (The InfoSoc Directive), Art. 2. G Mazziotti, ‘Allowing online content to cross borders: is Europe really paving the way for a Digital Single Market?’ in T Pihlajarinne, J Vesala and O Honkkila (eds) Online Distribution of Content in the EU, Edward Elgar Publishing (2019), 191. Geo-Blocking Regulation, pp. 1–15.

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I. GENERAL REMARKS

Directive, the InfoSoc Directive, the Directive on Privacy and Electronic Communications7 and the General Data Protection Regulation.8 However, the Geo-Blocking Regulation primarily targets online service providers or traders that apply different general conditions of access to their goods or services based on the user’s residence, and in effect hinder cross-border transactions.9 The legislation links to ensuring the free movement of goods and free movement of services in the digital single market.10 The Audiovisual Media Services Directive lays down the rule of not restricting retransmissions of audiovisual media services from other Member States in their territory.11 However, derogations are possible due to contracts with right holders restricting access to content based on national law. In that instance, audiovisual media service providers’ compliance with contractual obligations should be ensured.12 In practice, access to content may be limited by territory or a restricted time period, which is customary for films or TV series.13 Sports events, where the content is not subject to copyright, are protected through exclusive broadcasting or transmission rights.14 Online content service providers generally rely on re-transmission rights, which may be limited by contract to number of events, transmission format, access to commentary, number of re-runs as well as territory and time period.15 Broadcasters may fulfil their obligation to allow access to events of high interest for the purpose of short news reports by granting access to the venue, in lieu of the signal. This and the reproduction right laid down in Article 2 of the InfoSoc Directive, cements the exclusive rights of event organizers to maintain territorial licensing practices and control of the broadcasting signals, and hindering unauthorized cross-border content services.16 The Audiovisual Media Services Directive lays down the rule that ensures free movement of services in the digital single market, but creates an exception for restricted content based on a contract with right holders. The Portability Regulation concerns granting access to paid services from portable smart devices, 15.03 when a consumer is travelling. It makes a specific exception for contractual provisions, which in effect restrict access to paid content outside the subscriber’s state of residence, thus hindering cross-border movement of people and services. The overriding public interest rests on ensuring the free movement of people and free movement of services in the digital single market as laid down in primary EU law; namely the Treaty on the Functioning of the European Union.17 In fulfilling obligations under the Portability Regulation providers of online content services must ensure the subscriber’s rights to privacy on the one hand, and protection of personal data on the other. These regulations are based on securing rights of citizens as laid down in primary EU law; namely the Charter of Fundamental Rights in the European Union.18

7

8

9 10

11 12 13 14 15 16 17 18

Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector, [2002] OJ L 201/37, (Directive on Privacy and Electronic Communications). Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data ([1995] OJ L 281/31) was repealed 24/05/2018 (32016R0679) by Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC, [2016] OJ L 119/1; cor. [2018] OJ L 127/2 (General Data Protection Regulation). Geo-Blocking Regulation, Recital 1. Consolidated versions of the Treaty on European Union and the Treaty on the Functioning of the European Union; Consolidated version of the Treaty on the Functioning of the European Union; Protocols; Annexes; Declarations annexed to the Final Act of the Intergovernmental Conference which adopted the Treaty of Lisbon, signed on 13 December 2007; Tables of equivalences, [2012] OJ C 326, TFEU, Art. 26. Audiovisual Media Services Directive, Art. 3. Ibid., Art. 8. Ibid., Recital 76. InfoSoc Directive, Art. 2(e). Ibid., Art. 9. Audiovisual Media Services Directive, Recital 56 in line with the InfoSoc Directive, Art. 5.3(c). TFEU, Art. 36. Charter of Fundamental Rights of the European Union, [2000] OJ C 364/1.

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ARTICLE 1: SUBJECT MATTER AND SCOPE 1.

2.

This Regulation introduces a common approach in the Union to the cross-border portability of online content services, by ensuring that subscribers to portable online content services which are lawfully provided in their Member State of residence can access and use those services when temporarily present in a Member State other than their Member State of residence. This Regulation shall not apply to the field of taxation.

RELEVANT RECITALS: (1) Seamless access throughout the Union to online content services that are lawfully provided to consumers in their Member State of residence is important for the smooth functioning of the internal market and for the effective application of the principles of free movement of persons and services. Since the internal market comprises an area without internal borders relying, inter alia, on the free movement of persons and services, it is necessary to ensure that consumers can use portable online content services which offer access to content such as music, games, films, entertainment programmes or sports events, not only in their Member State of residence but also when they are temporarily present in another Member State for purposes such as leisure, travel, business trips or learning mobility. Therefore, barriers that hamper access to and use of such online content services in such cases should be eliminated. (4) There are a number of barriers which hinder the provision of online content services to consumers temporarily present in a Member State other than their Member State of residence. Certain online services include content such as music, games, films or entertainment programmes which are protected by copyright or related rights under Union law. At present, the barriers to cross-border portability of online content services differ from one sector to another. The barriers stem from the fact that the rights for the transmission of content protected by copyright or related rights, such as audiovisual works, are often licensed on a territorial basis, as well as from the fact that providers of online content services might choose to serve specific markets only. (5) The same applies to content, such as sports events, which is not protected by copyright or related rights under Union law but which could be protected by copyright or related rights under national law or by virtue of other specific national legislation and which is often also licensed by the organisers of such events or offered by providers of online content services on a territorial basis. Transmissions of such content by broadcasting organisations are protected by related rights which have been harmonised at Union level. Moreover, transmissions of such content often include copyright-protected elements such as music, opening or closing video sequences or graphics. Also, certain aspects of transmissions of such content, specifically those relating to broadcasting events of major importance for society as well as to short news reports on events of high interest to the public, have been harmonised by Directive 2010/13/EU of the European Parliament and of the Council(4). Finally, audiovisual media services within the meaning of Directive 2010/13/EU include services which provide access to content such as sports events, news or current affairs. (6) Increasingly, online content services are marketed in a package in which content which is not protected by copyright or related rights is not separable from content which is protected by copyright or related rights without substantially lessening the value of the service provided to consumers. This is especially the case with premium content such as sports events or other events of significant interest to consumers. In order to enable providers of online content

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services to provide to consumers full access to their online content services when consumers are temporarily present in a Member State other than their Member State of residence, it is indispensable that this Regulation also covers such content used by online content services and therefore that it applies to audiovisual media services within the meaning of Directive 2010/ 13/EU as well as to transmissions of broadcasting organisations in their entirety. (13) Given the Union instruments that exist in the field of taxation, it is necessary to exclude the field of taxation from the scope of this Regulation. Therefore, this Regulation should not affect the application of any provision related to taxation. (14) This Regulation defines several concepts necessary for its application, including the Member State of residence. The Member State of residence should be determined taking into account the objectives of this Regulation and the necessity to ensure its uniform application in the Union. The definition of the Member State of residence implies that the subscriber has his or her actual and stable residence in that Member State. A provider of an online content service who has verified the Member State of residence in accordance with this Regulation should be allowed to assume, for the purposes of this Regulation, that the Member State of residence as verified is the only Member State of residence of the subscriber. Providers should not be obliged to verify whether their subscribers are also subscribers to an online content service in another Member State. (16) An online service which is not an audiovisual media service within the meaning of Directive 2010/13/EU and which uses works, other protected subject-matter or transmissions of broadcasting organisations in a merely ancillary manner should not be covered by this Regulation. Such services include websites that use works or other protected subject-matter only in an ancillary manner such as graphical elements or music used as background, where the main purpose of such websites is, for example, the sale of goods. (18) This Regulation should apply to online content services which are provided against payment of money. Providers of such services are in a position to verify the Member State of residence of their subscribers. The right to use an online content service should be regarded as acquired against payment of money, whether such payment is made directly to the provider of the online content service, or to another party such as a provider offering a package combining an electronic communications service and an online content service operated by another provider. For the purposes of this Regulation, the payment of a mandatory fee for public broadcasting services should not be regarded as a payment of money for an online content service. (33) This Regulation is aimed at improving competitiveness by fostering innovation in online content services and attracting more consumers. This Regulation should not affect the application of the rules of competition, and in particular Articles 101 and 102 TFEU. The rules provided for in this Regulation should not be used to restrict competition in a manner contrary to the TFEU. (34) This Regulation should not affect the application of Directive 2014/26/EU of the European Parliament and of the Council(11) and in particular Title III thereof. This Regulation is consistent with the objective of facilitating the lawful access to content, which is protected by copyright or related rights, as well as services linked thereto.

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I. COMMENTARY 1. Subject matter 15.04 When subscribers are temporarily present in a Member State in which they do not reside, these subscribers need access to use online content services, including online content such as music, games, films or entertainment programmes, which are protected by copyright or related rights under EU or national law. Due to territorial restrictions in copyright licences, online content service contracts that private persons conclude with online content service providers may differ among Member States and users incur additional costs, when accessing the service or downloading online content abroad, if access is at all possible. The Digital Single Market Strategy for Europe attempts to ‘ensure that consumers can access services, music, movies and sport events on their electronic devices where they are in Europe regardless of borders’.19 In order to prevent unjustified geo-blocking, it is necessary to allow access to websites of online content service providers that are based in the person’s Member State of residence, when that person is temporarily present in another Member State. The Portability Regulation aims to enhance the smooth functioning of the internal market and the effective application of the principles of free movement of persons and services.20 15.05 The Portability Regulation ensures that subscribers to portable online content services, which are lawfully provided in the Member State of residence, can access and use those services when they are temporarily present in a Member State other than their Member State of residence. It ensures that consumers can use portable online content services which offer access to content, not only in their Member States of residence but also when they are temporarily present in another Member State for purposes such as leisure, travel, business trips or learning mobility.21 However, the Portability Regulation only covers private subscriptions, not business subscriptions.22 The reason why the consumer is temporarily abroad is not decisive, but the physical location of the consumer should not automatically prevent access to privately subscribed content. Smart phones, tablets and laptops enable consumers to access online content services regardless of their location.23 The Portability Regulation applies to online content services, which are based on valid licences from right holders (copyright, related rights or any other rights) authorizing provision of access to content in a specific territory. The providers must be authorized to enable streaming, using or downloading with applications or any other techniques that allows access to content that is covered by the service contract, to their subscribers.24

2. Scope 15.06 The Portability Regulation applies to all fields except the field of taxation. The use of online content services is regulated by the laws of the Member State of residence, where the online content service contracts are concluded (country of origin). The country of origin principle is essential in order to ensure the free flow of information and audiovisual programmes in the internal market and provide legal certainty for service providers.25 Under established EU law it applies to all audiovisual media

19 20 21 22 23 24 25

Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committtee of Regions, COM (2015) 192 final. Regulation (EU) 2017/1128 of the European Parliament and of the Council of 14 June 2017 on cross-border portability of online content services in the internal market, [2017] OJ L 168/1, (Portability Regulation), Recital 1. Ibid., Recital 1. Ibid., Art. 2.12 and Recitals 4 and 6 refer to consumers as natural persons, acting for purposes which are outside his or her trade, business, craft or profession. Ibid., Recital 2. Ibid, Recital 15. Audiovisual Media Services Directive, Recital 33.

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services and any exceptions must also be interpreted narrowly according to the Audiovisual Media Services Directive.26 For that reason, taxation law of the Member State of residence should also be applied for such services. When the subscriber is temporarily present in another country, the temporary use may not be regulated by the law, where the act of using or accessing the online content services occurs. The Portability Regulation does not affect the application of any provision related to taxation, including value-added tax (VAT), since it would create an undue financial burden on consumers and businesses.27 This rule prevents double taxation of subscribers for use of content which is used only once. Instead, the subscriber of online content services pays tax in the Member State of residence. Audiovisual media content has become a key element in the development of many online services. 15.07 The Portability Regulation is expected to enhance competition between online content services and encourage more consumers to access and use that content on portable devices such as laptops, tablets and smartphones. The content and types of services offered are the main decisive factors for consumers when entering contracts for online content services. Thus, the competitiveness of the content makes online content services more attractive and creates a comparative advantage. However, Articles 101 and 102 TFEU apply and prohibit anticompetitive practices that unlawfully divide or distort markets.28 The Portability Regulation promotes lawful access to and use of content that is protected by copyright or related rights and services linking to that content.29 Lawful use necessitates that online content service providers have appropriate authorization to offer content on portable devices. Title III of the Collective Rights Management Directive 2014/26/EU requires Member States to ensure that collective rights management organizations comply with the rules relating to multi-territorial licensing of copyrighted works. Article 32 enables simplified grants of multi-territorial licences for the online rights in musical works or online material necessary for broadcasters to deliver radio or television programmes.30 Article 32 identifies the burden of unnecessary clearance costs for broadcasters relating to ancillary copyright (musical works featured in radio or television broadcasts) and allows for a procedural derogation from cooperation between collective rights management organizations in Europe. Copyright for ancillary works is also excluded from the Portability Regulation, as are online platforms that include protected works as an ancillary feature of their business (e.g., sale of goods). It should be noted that the Collective Rights Management Directive applies to musical works, not 15.08 audiovisual content per se. Neither Title III of the Collective Rights Management Directive nor the Portability Regulation mandates multi-territorial licensing of online content protected by copyright. The objective is to enable licensing models and practices that promote access to digital content and formation of a digital single market.31 Cross-border portability of online content only applies to audiovisual media services within the meaning of the Audiovisual Media Services Directive, and not, for example, websites that use works in an ancillary manner while promoting or selling goods.32 Providers of audiovisual media services are outside the scope of the Portability Regulation, when

26

27 28 29 30

31 32

Case C-355/98 Commission v Belgium [2000] ECR I-1221, para. 28; Case C-348/96 Calfa [1999] ECR I-11, para. 23 and Audiovisual Media Services Directive, Recitals 33, 41 and 43. For the correct application of the country of origin principle in EU law see Case C-212/97 Centros v Erhvervs-og Selskabsstyrelsen [1999] ECR I-1459; Case 33/74 Van Binsbergen v Bestuur van de Bedrijfsvereniging [1974] ECR 1299; Case C-23/93 TV 10 SA v Commissariaat voor de Media [1994] ECR I-4795, para. 21. Portability Regulation, Recital 14. Ibid., Recital 33. Ibid, Recital 34. Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related right and multi-territorial licensing of rights in musical works for online use in the internal market [2014] OJ L257/73. Portability Regulation, Recital 34. Ibid., Recital 16.

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providing non-portable online content services. Providers of other online content services, e.g., e-books or podcast collections, are within the scope of the Portability Regulation, while an online shop that sells e-books or a blogger that includes video clips or podcasts is not. In this sense, it is not decisive whether the service is offered for payment or free, but whether it primarily offers online content services or sells/offers goods or other services. The obligation to provide cross-border portability of online content only applies to subscriptions that allow domestic access to online content on portable devices.33

ARTICLE 2: DEFINITIONS For the purposes of this Regulation, the following definitions apply: 1. ‘subscriber’ means any consumer who, on the basis of a contract for the provision of an online content service with a provider whether against payment of money or without such payment, is entitled to access and use such service in the Member State of residence; 2. ‘consumer’ means any natural person who, in contracts covered by this Regulation, is acting for purposes which are outside that person’s trade, business, craft or profession; 3. ‘Member State of residence’ means the Member State, determined on the basis of Article 5, where the subscriber has his or her actual and stable residence; 4. ‘temporarily present in a Member State’ means being present in a Member State other than the Member State of residence for a limited period of time; 5. ‘online content service’ means a service as defined in Articles 56 and 57 TFEU that a provider lawfully provides to subscribers in their Member State of residence on agreed terms and online, which is portable and which is: (i) an audiovisual media service as defined in point (a) of Article 1 of Directive 2010/13/ EU, or (ii) a service the main feature of which is the provision of access to, and the use of, works, other protected subject-matter or transmissions of broadcasting organisations, whether in a linear or an on-demand manner; 6. ‘portable’ means a feature of an online content service whereby subscribers can effectively access and use the online content service in their Member State of residence without being limited to a specific location.

RELEVANT RECITALS: (14) This Regulation defines several concepts necessary for its application, including the Member State of residence. The Member State of residence should be determined taking into account the objectives of this Regulation and the necessity to ensure its uniform application in the Union. The definition of the Member State of residence implies that the subscriber has his or her actual and stable residence in that Member State. A provider of an online content service who has verified the Member State of residence in accordance with this Regulation should be allowed to assume, for the purposes of this Regulation, that the Member State of residence as verified is the only Member State of residence of the subscriber. Providers should not be obliged to verify whether their subscribers are also subscribers to an online content service in another Member State. (15) This Regulation should apply to online content services that providers, after having obtained the relevant rights from rightholders in a given territory, provide to their subscribers on the basis of a contract, by any means including streaming, downloading, through applications or

33

Ibid., Recital 17.

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any other technique which allows use of that content. For the purposes of this Regulation, the term contract should be regarded as covering any agreement between a provider and a subscriber, including any arrangement by which the subscriber accepts the provider’s terms and conditions for the provision of online content services, whether against payment of money or without such payment. A registration to receive content alerts or a mere acceptance of HTML cookies should not be regarded as a contract for the provision of online content services for the purposes of this Regulation. (16) An online service which is not an audiovisual media service within the meaning of Directive 2010/13/EU and which uses works, other protected subject-matter or transmissions of broadcasting organisations in a merely ancillary manner should not be covered by this Regulation. Such services include websites that use works or other protected subject-matter only in an ancillary manner such as graphical elements or music used as background, where the main purpose of such websites is, for example, the sale of goods. (17) This Regulation should apply only to online content services which subscribers can effectively access and use in their Member State of residence without being limited to a specific location, as it is not appropriate to require providers of online content services that do not offer portable online content services in the Member State of residence of a subscriber to do so across borders. (18) This Regulation should apply to online content services which are provided against payment of money. Providers of such services are in a position to verify the Member State of residence of their subscribers. The right to use an online content service should be regarded as acquired against payment of money, whether such payment is made directly to the provider of the online content service, or to another party such as a provider offering a package combining an electronic communications service and an online content service operated by another provider. For the purposes of this Regulation, the payment of a mandatory fee for public broadcasting services should not be regarded as a payment of money for an online content service.

I. COMMENTARY 1. Subscriber A subscriber to online content services is any individual, who has subscribed or registered for online 15.09 content services with or without the payment of money. Subscribers are entitled to access and use online content services in the Member State of residence according to their contract with the online content service provider. After verification, the online content service provider may assume that the subscriber has only one Member State of residence.34 It is not necessary for the service providers to investigate if their subscribers are also subscribers of online content services in another Member State.35 Flash Eurobarometer 447a36 shows that the minimum subscription age for online content services is 15 years and 69 per cent of those aged 15–24 believed that cross-border portability is crucial to them if they were to subscribe to paid online content services.37 The Portability Regulation does not regulate the legal capacity of individuals, as this is left to national law.

34 35 36

37

Ibid., Recital 14. Ibid. Flash Eurobarometer 477a, ‘Accessing content online and cross-border portability of online content services’, April 2019 (Flash Eurobarometer 477a), p. 4, https://ec.europa.eu/commfrontoffice/publicopinion/index.cfm/Survey/get SurveyDetail/instruments-/FLASH/surveyKy/2221 (last visited 25 April 2020). Ibid.

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Provisions only apply to online content services that the subscriber is entitled to access and use in the Member State of residence.

2. Consumer 15.10 A consumer is any natural person, who enters a contract with an online content service provider for their own purposes, which are not related to the person’s trade, business, craft or profession. The Portability Regulation excludes subscriptions by legal entities or legal persons that use the online content services for commercial purposes. Consumers that benefit from the Portability Regulation are individuals, who use the cross-border online content service for non-commercial purposes during leisure, travel, business trips or learning mobility.38 In fact, the consumers of the online content services vary in age and their preferred content is also different ranging from music, audiovisual media, digital e-books, and games or gaming apps. The most popular paid content is music and audiovisual media content such as films, series and all TV content, excluding sports.39 According to the Flash Eurobarometer 477a, in January 2015 only 12 per cent of respondents answered that they paid for music, while in April 2019 this number had increased to 26 per cent. Similarly, 41 per cent of the respondents paid for audiovisual content in April 2019, while only 20 per cent paid in 2015.40

3. Member State of residence 15.11 Member State of residence means any Member State of the European Union where the subscriber has his/her actual and stable residence. The Portability Regulation does not require that the subscriber is a European citizen. Subscribers can be citizens of a third country and legally reside in the EU. The determination of the subscriber’s Member State of residence may be based on alternative verification means, such as an identity card, electronic identification of a person,41 evidence of payment details or the place of installation of a set-top box. Other means include receipt of payment by the subscriber of a licence fee for another service, an internet or telephone service supply contract, a utility bill, a registration on local electoral rolls or evidence of local payment of tax. Other supporting evidence may also be used such as a billing or postal address or an IP address check confirming the subscriber’s residence. In other words, the required means of verification laid down in Article 5.1 shows the linkage between the subscriber and the country where the online content services are provided. After a person has met the required means of verification, s/he is, for the purposes of portability, considered to be located in the Member State of residence.

4. Temporarily present in a Member State 15.12 A subscriber is considered temporarily present in a Member State, where s/he does not reside. It is not appropriate to request information beyond those required to verify the Member State of residence or use checks of IP addresses to monitor consumers’ whereabouts on a regular basis.42 Service providers should rely on the information they have, and once residence is verified, offer

38 39 40 41

42

Portability Regulation, Recital 1. Flash Eurobarometer 477a, p. 7. Ibid., p. 4. Regulation (EU) No 910/2014 of the European Parliament and of the Council of 23 July 2014 on electronic identification and trust services for electronic transactions in the internal market and repealing Directive 1999/93/EC, [2014] OJ L 257/73. Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, 1.6.2018.

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portability of services. Extended presence of a subscriber in another Member State does not prevent access or use of content legally offered by the service providers in the Member State of residence.43 The concept ‘temporarily present in another Member State ’ could create the misunderstanding that 15.13 service providers could limit the time that a person can spend abroad. Some service providers had interpreted the phrase to allow specifying a time limit for cross-border portability. The Commission has since clarified that no matter how long a person is present in another Member State, they are temporarily present, if their residence is verified in the Member State of subscription. The portability obligation is based solely on the subscriber’s Member State of residence44 which entitles access to and use of the online content services with cross-border portability. There is no provision in the Portability Regulation that limits the portability of online service to a specific period of time.45 Hence, limitation of portability to a specific time period by service providers is contrary to the Portability Regulation, and unenforceable.46 Continuous tracking of consumers’ location is unnecessary, and infringes the right to privacy, which is excluded by the Portability Regulation.47 IP address checks are allowed only at specific points in time, such as the conclusion and the renewal of contract, when residence is verified.48 Such checks were only permitted for old contracts that pre-dated the Portability Regulation during the transition period between 1 April 2018 and 2 June 2018.49 While IP address checks can be used as a supplementary means of verification of the subscriber’s residence, it is not intended as a tool to disprove temporary presence or limit availability of cross-border portability.50 An IP address check based on ‘reasonable doubt ’ regarding the residence of the individual subscriber needs to be based on the facts of the individual case. Such checks should be exceptional and carried out only when justified. Service providers must be able to give specific reasons for their doubts relating to the individual subscriber’s residence.51 Data gathered by IP address checks cannot be retained for any purpose and must be immediately and irreversibly destroyed after verification. In the case of justified reasonable doubt, IP address checks may be used as the sole means of verification.52

5. Online content service The freedom of movement of services protected by Article 56 TFEU prohibits restrictions on 15.14 lawfully provided services within the EU.53 Online content services are portable online services within the meaning of Article 57 TFEU where they are normally provided for remuneration, and not governed by the provisions of freedom of movement for goods, capital or persons.54 Online content services are audiovisual media services as defined in the Audiovisual Media Services Directive, which include television broadcasting, on-demand audiovisual media services and audiovisual commercial communication or a service whose main feature is providing access to protected works or transmissions of broadcasting organizations.55 Accordingly, an audiovisual

43 44 45 46 47

48 49 50 51 52 53 54 55

Portability Regulation, Recital 23. Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, note 42. Ibid. Ibid. Opinion of the associated Committee on Culture and Education in the European Parliament supports this conclusion in Report of 15 July 2016 on the proposal for a regulation of the European Parliament and of the Council on ensuring the cross-border portability of online content services in the internal market, A8-0378/2016, p. 71. Portability Regulation, Art. 5.1(k). Ibid., Art. 9.2. Ibid., Art. 5.1(k). Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, note 42. Ibid. TFEU, Art. 56. Ibid., Art. 57. Portability Regulation, Art. 2.5(i) and (ii). Article 2.5.(i) of the Portability Regulation refers to Art. 1(a) (e) and (g) of the Audiovisual Media Services Directive.

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media service is a service that is under the editorial responsibility of a media service provider with the principal purpose of providing programmes informing, entertaining or educating the general public using electronic communications networks. It includes linear audiovisual media services provided by a provider for simultaneous viewing of programmes on the basis of a programme schedule and non-linear services provide by a media service provider for the viewing of programmes at the moment chosen by the user and at his or her individual request on the basis of a catalogue of programmes selected by the media service provider.56 In addition to audiovisual media services, the definition includes any online content service whose main feature is to provide access to and the use of protected works, subject-matter or broadcasts whether linear or on-demand.57 Online services or websites that provide access to protected works merely as an ancillary feature are not covered by the Portability Regulation.58 To sum up, audiovisual media services include services which provide access to content such as entertainment programmes, sport events, news or current affairs offline and online.59 Online content services are portable audiovisual or other content services offered online. 15.15 It is important to highlight that there is no obligation on service providers to offer services on portable devices abroad where they are not portable (i.e., limited to a specific location) in the Member State of residence. The latter is, for example, the case when the provision of a service relies exclusively on dedicated devices, such as set-top boxes or decoders. This means that if a service provider decides to provide a service by means of a set-top box or a decoder, there is no obligation to offer portability to subscribers that are temporarily abroad regarding this service (the situation would be different as regards complimentary portable online services that some service providers may offer in addition or separately to non-portable services). The same logic also applies to functionalities. If, for example, a service provider offers its service on mobile devices such as tablets and smartphones in the Member State of residence, but decides not to allow for certain functionalities (such as, for example, screen mirroring or streaming of content from these devices to TVs or projectors with or without the use of receiving devices such as Apple TV, Chromecast or Amazon FireTV Stick, etc.), then the service provider would be under no obligation to make this functionality available while the consumer is temporarily abroad.60

6. Portable 15.16 A specific feature of an online content service is that subscribers can easily access and use it regardless of their location. The subscriber’s ability to access or use the online content services is the same, regardless of location. Providers of online content services cannot, based on the specific location of their customers, refuse to provide their online content without justified reasons. The sole purpose of the Portability Regulation is to ensure the cross-border portability of online content services.61 It is important to highlight that there is no obligation on service providers to offer services on portable devices abroad where the service is not portable (i.e., limited to a specific location) in the Member State of residence.62

56 57 58 59 60 61 62

Audiovisual Media Services Directive, Points (e), (g), Art. 1.1. Portability Regulation, Art. 5.2(ii). Ibid., Recital 16. Ibid., Recital 4. Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, note 42. Portability Regulation, Recital 23. Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, note 42.

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ARTICLE 3: OBLIGATION TO ENABLE CROSS-BORDER PORTABILITY OF ONLINE CONTENT SERVICES

ARTICLE 3: OBLIGATION TO ENABLE CROSS-BORDER PORTABILITY OF ONLINE CONTENT SERVICES 1.

2. 3.

4.

The provider of an online content service provided against payment of money shall enable a subscriber who is temporarily present in a Member State to access and use the online content service in the same manner as in the Member State of residence, including by providing access to the same content, on the same range and number of devices, for the same number of users and with the same range of functionalities. The provider shall not impose any additional charges on the subscriber for the access to and the use of the online content service pursuant to paragraph 1. The obligation set out in paragraph 1 shall not extend to any quality requirements applicable to the delivery of an online content service that the provider is subject to when providing that service in the Member State of residence, unless otherwise expressly agreed between the provider and the subscriber.The provider shall not take any action to reduce the quality of delivery of the online content service when providing the online content service in accordance with paragraph 1. The provider shall, on the basis of the information in its possession, provide the subscriber with information concerning the quality of delivery of the online content service provided in accordance with paragraph 1. The information shall be provided to the subscriber prior to providing the online content service in accordance with paragraph 1 and by means which are adequate and proportionate.

RELEVANT RECITALS (19) Providers of online content services should not subject their subscribers to any additional charges for the provision of cross-border portability of online content services in accordance with this Regulation. It is possible however that subscribers, in order to access and use online content services in Member States other than their Member State of residence, could be subject to fees payable to operators of electronic communications networks used to access such services. (20) Providers of online content services which are provided without payment of money generally do not verify the Member State of residence of their subscribers. The inclusion of such online content services in the scope of this Regulation would involve a major change to the way those services are delivered and involve disproportionate costs. However, the exclusion of those services from the scope of this Regulation would mean that providers of those services would not be able to take advantage of the legal mechanism which is provided for in this Regulation and which enables providers of online content services to offer cross-border portability of such services, even when they decide to invest in means that allow them to verify their subscribers’ Member State of residence. Accordingly, providers of online content services which are provided without payment of money should be able to opt to be included in the scope of this Regulation provided that they comply with the requirements on the verification of the Member State of residence of their subscribers. If such providers exercise that option, they should comply with the same obligations as imposed under this Regulation upon the providers of online content services which are provided against payment of money. Furthermore, they should inform the subscribers, the relevant holders of copyright and related rights and the relevant holders of any other rights in the content of the online content service of their decision to exercise that option in a timely manner. Such information could be provided on the provider’s website. (21) In order to ensure the cross-border portability of online content services, it is necessary to require providers of online content services covered by this Regulation to enable subscribers to

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use such services in the Member State in which they are temporarily present in the same manner as in their Member State of residence. Subscribers should have access to online content services offering the same content on the same range and number of devices, for the same number of users and with the same range of functionalities as those offered in their Member State of residence. It is essential that the obligation to provide cross-border portability of online content services be mandatory and therefore the parties should not be able to exclude it, derogate from it or vary its effect. Any action by a provider which would prevent subscribers from accessing or using the service while temporarily present in a Member State other than their Member State of residence, for example restrictions to the functionalities of the service or to the quality of its delivery should be considered to be a circumvention of the obligation to provide cross-border portability of online content services and therefore contrary to this Regulation. (22) Requiring that the delivery of online content services to subscribers temporarily present in a Member State other than their Member State of residence be of the same quality as in the Member State of residence could result in high costs for providers of online content services and thus ultimately for subscribers. Therefore, it is not appropriate for this Regulation to require that providers ensure a quality of delivery of such services that would be beyond the quality available via the local online access chosen by a subscriber while temporarily present in another Member State. In such cases the provider should not be liable if the quality of delivery of the service is lower. Nevertheless, if the provider expressly guarantees a certain quality of delivery to subscribers while temporarily present in another Member State, it should be bound by that guarantee. The provider, on the basis of the information in its possession, should provide its subscribers in advance with information concerning the quality of delivery of an online content service in Member States other than their Member State of residence, in particular the fact that the quality of delivery could differ from that applicable in their Member State of residence. The provider should not be under an obligation to actively seek information on the quality of delivery of a service in Member States other than the subscriber’s Member State of residence. The relevant information could be provided on the provider’s website. (23) In order to ensure that providers of online content services covered by this Regulation comply with the obligation to provide cross-border portability of their services, without acquiring the relevant rights in another Member State, it is necessary to stipulate that those providers should always be entitled to provide such services to subscribers when they are temporarily present in a Member State other than their Member State of residence. This should be achieved by establishing that the provision of, access to and use of such online content services should be deemed to occur in the subscriber’s Member State of residence. This legal mechanism should apply for the sole purpose of ensuring the cross-border portability of online content services. An online content service should be considered to be provided lawfully if both the service and the content are provided in a lawful manner in the Member State of residence. This Regulation, and in particular the legal mechanism by which the provision of, access to and use of an online content service are deemed to occur in the subscriber’s Member State of residence, does not prevent a provider from enabling the subscriber to additionally access and use the content lawfully offered by the provider in the Member State where the subscriber is temporarily present.

I. COMMENTARY 15.17 Under Article 3, the providers of online content services are obligated to enable cross-border portability of online content services as follows:

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1. In the same manner Under the Portability Regulation, the providers shall provide access to the same content, on the 15.18 same range and number of devices, for the same number of users and with the same range of functionalities regardless of the subscriber’s location. This obligation applies to providers of online content services that are provided against payment. In other words, paying subscribers, who are temporarily abroad, should be able to access and use the online service in the same manner as in the Member State of residence. The obligation applies to content services that are portable and service providers are not obliged to offer services on portable devices abroad, if they are not portable in the Member State of residence.63 This obligation cannot be circumvented by contractual provisions limiting access abroad, derogating from it or varying its effect.64 The service providers shall provide access: (i) to the same content; (ii) on the same range and 15.19 number of devices; (iii) for the same number of users; and (iv) with the same range of functionalities as the subscriber can access in its home State.65 This obligation applies to providers of paid online content services. Providers of free online content services are not bound by this obligation.66 In cases where the service providers opt to be included in the scope of the Portability Regulation, they should comply with the requirements on verification of the subscriber’s Member State of residence and accordingly with the obligations imposed on providers of paid online content services.67 Some online content service providers had limited the range of devices, when subscribers used the 15.20 content services in other Member States. The Commission has rejected this interpretation as contrary to Article 3.1 of the Portability Regulation.68 The service provider’s obligation extends to providing the same range of functionalities of the service for the subscribers, when they are temporarily present in another Member State. This obligation only applies when the online content service provider offers its service on mobile devices such as smartphones, tablets, laptops in the Member State of residence. If that service provider does not allow for some functionalities, for example, screen mirroring or streaming of content from the mobile devices to TV, then that provider is not considered in violation of its obligation under Article 3.1 of the Portability Regulation, when not doing so for portable devices abroad. The service provider does not have to make functionalities available abroad that they do not offer subscribers at home.69

2. Any additional charges Normally, payment for online content services can be made either via a paid subscription or on a 15.21 per-item basis (e.g., e-books or music). Except for those payments that subscribers have already made to the online content service providers, subscribers should not incur any additional charges because they are temporarily in another Member State. Article 3.2 of the Portability Regulation helps to eliminate unreasonable expenses related to the access or use of online content services abroad. However, the subscriber may incur additional fees in order to access or use the online content service abroad, but these fees are payable to the network operator used to access such a

63 64 65 66 67 68 69

Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, note 42. Portability Regulation, Recital 21. Ibid. Ibid., Recital 20. Ibid., Art. 5 and Recital 20. Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, note 42. Ibid.

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service.70 Online content service providers are responsible for making their content and services available for access and use, not for delivering extra services abroad.71

3. Quality of service 15.22 It is not appropriate to require that providers ensure a quality of delivery of services that would be beyond the quality available via the local online access chosen by a subscriber while temporarily present in another Member State. This would lead to unreasonably high costs for the online service provider.72 However, if service providers expressly guarantee quality of service, subscribers who are temporarily present in a Member State are entitled to access and use the online content services in the same manner as in their Member State of residence. The provider is not under an obligation to seek out information about the quality of service in other Member States, however, they must inform the subscriber on the issue. Information can be provided on the provider’s website.73 Thus, the provider is responsible for the overall quality of the service offering, including access to their websites without automatic re-routing based on the IP-address accessing the service. They are also responsible for availability of the same content and functionalities to the extent that these are offered for portable devices in the subscriber’s State of residence. Online content providers are not liable for the quality of service in terms of technical capacity, when for example the subscriber is downloading or using the service through free Wi-Fi, limited capacity mobile services, crowded networks or locations in areas with limited network coverage. Use of the services in these situations is beyond the capacity of the online access chosen by the subscriber, and not within the control of the online service provider. It would be unreasonable and ineffective to impose liability on service providers in these circumstances, and liability is therefore excluded from the scope of the Portability Regulation. 15.23 According to the Flash Eurobarometer 477a Report, 58 per cent of respondents who subscribed to paid online content services said the cross-border portability worked well; 15 per cent of respondents stated that either the choice content was limited or not the same compared with what was available to them in their Member State of residence. Meanwhile, 14 per cent of the respondents experienced issues with the quality or speed of connection. Yet, 3 per cent of the surveyed respondents noted that they could not access the online content service even with a good internet connection.74 It seems that there are still many issues related to quality of the provided services that the online content service providers have to overcome in order to ensure that Article 3.1 of the Portability Regulation can be applied effectively in every Member State of the Union.

4. Providing information 15.24 The provider is obliged to provide the subscribers with information concerning the quality of the cross-border online content services by means which are adequate and proportionate. The information related to cross-border portability of online content services can be presented on the provider’s website.75 Yet, the online content service providers are not obliged to provide information related to the quality of services in other Member States.76 Subscribers shall be informed in advance about the provided cross-border online content services prior to concluding the contract with providers. Sufficient information helps subscribers make informed decisions on whether to enter a

70 71 72 73 74 75 76

Portability Regulation, Recital 19. Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, note 42. Portability Regulation, Recital 22. Ibid. Flash Eurobarometer 477a, p. 5. Portability Regulation, Recital 23. Ibid., Recital 22.

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ARTICLE 4: LOCALIZATION OF THE PROVISION OF, ACCESS TO & USE OF ONLINE CONTENT SERVICES

portable online content service contract with the provider. The parties of the online content service agreement are bound by their commitments to each other. Providing information is mandatory for paid online content service providers, while it remains optional for free online content service providers.77 All the obligations of online content service providers are listed in Article 3 of the Portability 15.25 Regulation and apply to providers of paid online content services. The quality and content of the online services are features that customers desire and are willing to pay for, and are often decisive for entering contracts with online content service providers. In cases where these obligations are not executed, if the providers attempt to reduce the quality of services or eliminate certain specific functionalities of the services, the providers are not complying with the obligation to provide cross-border portability of online content services according to the Portability Regulation. The Portability Regulation does not contain any provisions on remedies, which is a matter for national law.78

ARTICLE 4: LOCALIZATION OF THE PROVISION OF, ACCESS TO AND USE OF ONLINE CONTENT SERVICES The provision of an online content service under this Regulation to a subscriber who is temporarily present in a Member State, as well as the access to and the use of that service by the subscriber, shall be deemed to occur solely in the subscriber’s Member State of residence.

RELEVANT RECITAL: (23) In order to ensure that providers of online content services covered by this Regulation comply with the obligation to provide cross-border portability of their services, without acquiring the relevant rights in another Member State, it is necessary to stipulate that those providers should always be entitled to provide such services to subscribers when they are temporarily present in a Member State other than their Member State of residence. This should be achieved by establishing that the provision of, access to and use of such online content services should be deemed to occur in the subscriber’s Member State of residence. This legal mechanism should apply for the sole purpose of ensuring the cross-border portability of online content services. An online content service should be considered to be provided lawfully if both the service and the content are provided in a lawful manner in the Member State of residence. This Regulation, and in particular the legal mechanism by which the provision of, access to and use of an online content service are deemed to occur in the subscriber’s Member State of residence, does not prevent a provider from enabling the subscriber to additionally access and use the content lawfully offered by the provider in the Member State where the subscriber is temporarily present.

I. COMMENTARY The objective of the Portability Regulation is to ensure the cross-border portability of online 15.26 content services in the EU, regardless of the location of the subscriber. The provision of, access to and use of online content services is assumed to take place in the Member State of residence even if the subscriber is present in another Member State. The verification of the Member State of

77 78

Ibid., Recital 23. Ibid., Recital 21.

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residence is carried out in order to identify whether a subscriber qualifies for the cross-border portability of online content services or not. Evidence to the contrary is unnecessary, since a valid subscription in the Member State of residence automatically triggers the duty to provide portability of portable services. When a subscriber is in another Member State, s/he is entitled to use and access the same content provided by the online content service providers in the Member State of residence. The online content service providers are entitled, without acquiring the relevant rights in another Member State, to provide the online content service to subscribers, when they are temporarily present in a Member State other than their Member State of residence.79 For the purposes of rights clearance the acts of reproduction, communication to the public and the making available of protected works or subject matter, when providing the service are also assumed to take place in the Member State of residence of that subscriber.80 The accessing, using, and downloading of the content services or protected content by the subscribers are not considered infringement of the exclusive rights of holders of copyright, related rights or other rights.81

ARTICLE 5: VERIFICATION OF THE MEMBER STATE OF RESIDENCE 1.

2.

79 80 81

At the conclusion and upon the renewal of a contract for the provision of an online content service provided against payment of money, the provider shall verify the Member State of residence of the subscriber by using not more than two of the following means of verification and shall ensure that the means used are reasonable, proportionate and effective: (a) an identity card, electronic means of identification, in particular those falling under the electronic identification schemes notified in accordance with Regulation (EU) No 910/2014 of the European Parliament and of the Council, or any other valid identity document confirming the subscriber’s Member State of residence; (b) payment details such as the bank account or credit or debit card number of the subscriber; (c) the place of installation of a set-top box, a decoder or a similar device used for supply of services to the subscriber; (d) the payment by the subscriber of a licence fee for other services provided in the Member State, such as public service broadcasting; (e) an internet or telephone service supply contract or any similar type of contract linking the subscriber to the Member State; (f) registration on local electoral rolls, if the information concerned is publicly available; (g) payment of local taxes, if the information concerned is publicly available; (h) a utility bill of the subscriber linking the subscriber to the Member State; (i) the billing address or the postal address of the subscriber; (j) a declaration by the subscriber confirming the subscriber’s address in the Member State; (k) an internet protocol (IP) address check, to identify the Member State where the subscriber accesses the online content service.The means of verification under points (i) to (l) shall only be used in combination with one of the means of verification under points (a) to (h), unless the postal address under point (i) is included in a publicly available official register. If the provider has reasonable doubts about the subscriber’s Member State of residence in the course of the duration of the contract for the provision of an online content service, the provider may repeat the verification of the Member State of residence of the subscriber, in Ibid., Recital 23. Ibid., Recital 24. Ibid.

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3.

4.

5.

accordance with paragraph 1. In such a case, however, the means of verification under point (k) may be used as a sole means. Data resulting from the use of the means of verification under point (k) shall be collected in binary format only. The provider shall be entitled to request the subscriber to provide the information necessary to determine the subscriber’s Member State of residence in accordance with paragraphs 1 and 2. If the subscriber fails to provide that information, and as a result the provider is unable to verify the subscriber’s Member State of residence, the provider shall not, on the basis of this Regulation, enable the subscriber to access or use the online content service when the subscriber is temporarily present in a Member State. The holders of copyright or related rights or those holding any other rights in the content of an online content service may authorise the provision of, access to and use of their content under this Regulation without verification of the Member State of residence. In such cases, the contract between the provider and the subscriber for the provision of an online content service shall be sufficient to determine the subscriber’s Member State of residence. The holders of copyright or related rights or those holding any other rights in the content of an online content service shall be entitled to withdraw the authorisation given pursuant to the first subparagraph subject to giving reasonable notice to the provider. The contract between the provider and the holders of copyright or related rights or those holding any other rights in the content of an online content service shall not restrict the possibility for such holders of rights to withdraw the authorisation referred to in paragraph 4.

RELEVANT RECITALS: (26) This Regulation should enable subscribers to enjoy online content services to which they have subscribed in their Member State of residence when they are temporarily present in another Member State. Subscribers should be eligible for cross-border portability of online content services only if they reside in a Member State of the Union. Therefore, this Regulation should oblige providers of online content services to make use of reasonable, proportionate and effective means in order to verify the Member State of residence of their subscribers. To that end, providers should use the means of verification listed in this Regulation. This does not preclude agreement between providers and rightholders on those means of verification within the limits of this Regulation. The objective of the list is to provide legal certainty as to the means of verification to be used by providers as well as to limit interference with subscribers’ privacy. In each case, account should be taken of the effectiveness and proportionality of a particular means of verification in a given Member State and for a given type of online content service. Unless the subscriber’s Member State of residence can be verified with sufficient certainty on the basis of a single means of verification, providers should rely on two means of verification. In cases where the provider has reasonable doubts concerning the subscriber’s Member State of residence, the provider should be able to repeat the verification of the subscriber’s Member State of residence. The provider should implement the necessary technical and organisational measures required under applicable data protection rules for the processing of personal data collected for the purpose of verification of the subscriber’s Member State of residence under this Regulation. Examples of such measures include providing transparent information to the individuals about the methods used for, and the purpose of, the verification, and appropriate security measures. (27) In order to verify the subscriber’s Member State of residence, the provider of an online content service should rely, if possible, on information which is in the provider’s possession, such as billing information. As regards contracts concluded prior to the date of application of this Regulation and as regards the verification carried out upon renewal of a contract, the

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provider should be allowed to request the subscriber to provide the information necessary to verify the subscriber’s Member State of residence only when it cannot be determined on the basis of information which is already in the provider’s possession. (28) IP address checks performed under this Regulation should be conducted in accordance with Directives 95/46/EC(9) and 2002/58/EC(10) of the European Parliament and of the Council. In addition, for the purpose of verification of the subscriber’s Member State of residence what matters is not the precise location of the subscriber, but rather the Member State in which the subscriber is accessing the service. Accordingly, data on the subscriber’s precise location or any other personal data should neither be collected nor processed for that purpose. Where the provider has reasonable doubts concerning the subscriber’s Member State of residence and carries out an IP address check to verify the Member State of residence, the sole purpose of such checks should be to establish whether the subscriber is accessing or using the online content service within or outside the Member State of residence. Therefore, in such cases, the data resulting from the checking of IP addresses should only be collected in binary format and in compliance with applicable data protection rules. The provider should not exceed that level of detail. (29) A holder of copyright, related rights, or any other rights in the content of an online content service should remain able to exercise contractual freedom to authorise such content to be provided, accessed and used under this Regulation without verification of the Member State of residence. This can be particularly relevant in sectors such as music and e-books. Each rightholder should be able to take such decisions freely when entering into contracts with providers of online content services. Contracts between providers and rightholders should not restrict the possibility for rightholders to withdraw such authorisation subject to giving reasonable notice to the provider. The authorisation given by an individual rightholder does not as such release the provider from the obligation to verify the subscriber’s Member State of residence. It is only in cases where all the holders of copyright, related rights or any other rights in the content used by the provider decide to authorise their content to be provided, accessed and used without verification of the subscriber’s Member State of residence that the obligation to verify should not apply, and the contract between the provider and the subscriber for the provision of an online content service should be used to determine the latter’s Member State of residence. All other aspects of this Regulation should remain applicable in such cases.

I. COMMENTARY 1. Means of verification 15.27 Under the Portability Regulation, subscribers of online content services are eligible for cross-border portability of online content services when they are temporarily present in another Member State, if they have previously subscribed to the service in their Member State of residence.82 In order to identify whether a subscriber has the right to access and use online content services cross-border during the time spent in another EU Member State, the service providers may rely on alternative means of verification listed in the Portability Regulation.83 Means of verification are used to provide legal certainty when the service providers need to identify if their subscribers are residing in the Member State, where services are provided. Yet, the subscribers’ privacy must be respected. For that reason, the choice of means of verification must be reasonable, proportionate, and effective. For example, it is sufficient for an online content service provider to rely on the billing information to

82 83

Portability Regulation, Recital 26. Ibid., Art. 5.1.

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determine the Member State of residence.84 Information that the providers of online content services possess among other information included in the contracts or provided by subscribers in order to conclude contracts with online content service providers, properly identify the residence of the subscriber. Article 5 aims to limit the possibility that the service providers abuse their rights by requiring extra information from subscribers.85 In cases where the subscriber’s Member State of residence cannot be identified precisely, no more than two alternative means may be employed to verify.86 Means of verification that are included in Article 5 of the Portability Regulation are exhaustive, and online content service providers cannot add or require any other information.

2. Reasonable doubts The means of verification laid down in Article 5.1 points (a)–(j) cover most means that the service 15.28 providers can use to identify the Member State of residence. Only when the information is unclear or insufficient for verification and there is reasonable doubt can the providers employ an IP address check to verify the Member State of residence.87 For example, if the provider requests information from the subscriber, and s/he fails to provide it, or provides insufficient information, it may give rise to reasonable doubt. The provider cannot grant access to the online content services cross-border without verifying the Member State of residence.88 Checking the IP address is used as a last measure to verify the Member State of residence in case the 15.29 other means of verification or the combination of means are insufficient. The only purpose of an IP-address check is to identify the location where the subscriber’s access to or use of the online content services occurs.89 The location data should only be collected in binary format and in compliance with data protection rules as provided by the General Data Protection Regulation90 and Directive on Privacy and Electronic Communications. Continuous tracking of the subscriber’s location, or repeated checking of IP addresses in order to 15.30 limit portability to a specific period of time, is not consistent with the purposes of verification set out in the Portability Regulation.91 IP addresses convey location data, which is considered personal data protected under the General Data Protection Regulation.92 Subscribers must be informed, if an IP-address check is carried out, including providing information about the method employed, the purpose of the IP-address check and the appropriate security measures that are used during the IP-address check.93 In order to avoid future conflicts related to IP-address checks to verify the location of the subscriber, online content service providers can collect data in binary format only, not exceeding the level of detail described in the Portability Regulation.94 In addition, the providers cannot store any of the data collected for any reason for longer than is essential for the purpose of verification of the subscriber’s Member State of residence. After verification the collected data must be immediately and irreversibly destroyed.95

84 85 86 87 88 89 90 91 92 93 94 95

Ibid., Recital 27. Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, note 42. Portability Regulation, Art. 5.1(k). Ibid., Art. 5.1(k). Ibid., Arts 5.2 and 5.3. Ibid., Art. 5.2. General Data Protection Regulation, Arts 5 and 6. Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, note 42. C-582/14 Patrick Breyer v Bundesrepublik Deutschland ECLI:EU:C:2016:779, para 49. Portability Regulation, Recital 26. Ibid., Recital 28. Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, note 42.

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3. Information necessary 15.31 According to the Portability Regulation, the online content service providers are entitled to require their subscribers to provide information in order to determine the Member State of residence. Yet, the Portability Regulation only allows the providers to request information necessary to determine residence from the subscribers. Even though there is no definition or explanation on what necessary means, it can, in this context, be understood that online content service providers should request additional information from their subscribers only when the existing information that they already possess is insufficient to determine the subscriber’s Member State of residence.96 This requirement is designed to prevent providers from requesting irrelevant information that is not essential for the purpose of verification. In fact, when subscribers conclude a contract with the online content service provider, subscribers must usually provide the relevant information required by the online content service providers to properly verify residence and lawfully offer cross-border portability of services.97

4. Authorization 15.32 Ownership of the content gives the right holders (copyright, related rights or any other rights) exclusive rights to authorize use, access to and making available of their content and may exercise their right by contract requiring that online content service providers verify the Member State of residence of their subscribers. Right holders have no obligation to verify the subscriber’s residence. Under the Portability Regulation, however, the contract between the online content service provider and subscriber for the provision of an online content service is sufficient to determine the Member State of residence of the subscriber, and consequently where the acts of reproduction are deemed to occur. Enjoying the freedom of contract the right holders have full discretion to decide whether to authorize use of content, when concluding the contract with online service providers. Right holders are also entitled to authorize use without verification of the subscriber’s residence and online service providers are not bound by the obligation to verify in this instance. This can be particularly relevant in sectors such as music and e-books.98 However, the authorization of a sole right holder cannot release the providers of online content services from their obligation to verify the subscriber’s Member State of residence. Only if all the content right holders used by the service provider decide to authorize their content without verification of the subscriber’s Member State of residence, are the providers of online content services released from the verifying obligation.99

5. Withdrawing authorization 15.33 Based on the freedom of contract, any right holder (copyright, related rights or any other rights) of protected content can withdraw the authorization to online content service providers after giving reasonable notice to the provider.100 The possibility of right holders to withdraw the authorization cannot be restricted by the contract between the online content service provider and other right holders (collective rights management organizations).101 In other words, the online service provider is obligated to verify the subscriber’s Member State of residence and can satisfy this requirement based on e.g., the end-user agreement. Any contractual provision that prevents individual right

96 97 98 99 100 101

Ibid. Portability Regulation, Recital 27. Ibid., Recital 28. Ibid., Recital 29. Ibid., Art. 5.4. Ibid., Art. 5.5.

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ARTICLE 6: CROSS-BORDER PORTABILITY OF ONLINE CONTENT SERVICES

holders from withdrawing authorization to use their protected content is unenforceable.102 A right holder can withdraw specific content from a bulk licence signed by a collective rights management organization.

ARTICLE 6: CROSS-BORDER PORTABILITY OF ONLINE CONTENT SERVICES PROVIDED WITHOUT PAYMENT OF MONEY 1.

2.

3.

The provider of an online content service provided without payment of money may decide to enable its subscribers who are temporarily present in a Member State to access and use the online content service on condition that the provider verifies the subscriber’s Member State of residence in accordance with this Regulation. The provider shall inform its subscribers, the relevant holders of copyright and related rights and the relevant holders of any other rights in the content of the online content service of its decision to provide the online content service in accordance with paragraph 1, prior to providing that service. The information shall be provided by means which are adequate and proportionate. This Regulation shall apply to providers that provide an online content service in accordance with paragraph 1.

RELEVANT RECITAL: (20) Providers of online content services which are provided without payment of money generally do not verify the Member State of residence of their subscribers. The inclusion of such online content services in the scope of this Regulation would involve a major change to the way those services are delivered and involve disproportionate costs. However, the exclusion of those services from the scope of this Regulation would mean that providers of those services would not be able to take advantage of the legal mechanism which is provided for in this Regulation and which enables providers of online content services to offer cross-border portability of such services, even when they decide to invest in means that allow them to verify their subscribers’ Member State of residence. Accordingly, providers of online content services which are provided without payment of money should be able to opt to be included in the scope of this Regulation provided that they comply with the requirements on the verification of the Member State of residence of their subscribers. If such providers exercise that option, they should comply with the same obligations as imposed under this Regulation upon the providers of online content services which are provided against payment of money. Furthermore, they should inform the subscribers, the relevant holders of copyright and related rights and the relevant holders of any other rights in the content of the online content service of their decision to exercise that option in a timely manner. Such information could be provided on the provider’s website.

I. COMMENTARY 1. General There is little data on free online content service providers opting-in to offer portability of services. 15.34 It is likely that most free online services have not made use of the opt-in provision. Early feedback

102

Ibid., Recital 29.

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Chapter 15 THE PORTABILITY REGULATION

from April 2019 showed that most of the free online video services having implemented, preparing or considering portability were free online services of public broadcasters. Over half of online video services providers did not respond, and half of respondents indicated that they were not considering implementation of portability one year after the entry into force of the Portability Regulation.103 Respondents indicated various reasons against implementation, namely the cost/benefit ratio being unconvincing, other priorities and issues relating to verification, remuneration demands and doubts related to successful compliance.104 Only public broadcasters were not driven by perceived demand, since providing services to citizens is their primary purpose, and portability is a means to achieve this objective.105 Many broadcasters that own the productions they offer online already made content accessible to users in other Member States.106 The issue relates to underlying rights to content that may not include portability, forbid it, or simply not address the issue with a third party. Some free services designed for specific audiences and European or global markets have acquired multistate licences for providing the content regardless of user location. The target audience may be defined by language, or by niche-market content, where scattered, but constant demand, make the business model viable.107 For most, however, portability is not a priority.

2. Scope 15.35 Online content service providers that offer services free of charge are not covered by the mandatory provisions of the Portability Regulation. However, they may choose to opt-in and provide portability to their users. Normally, free online content services do not verify the residence of their users. Article 6 provides the means of doing so in a manner that respects the rights of users. When opting in, service providers must follow the procedure and limits laid down in Article 5 of the Portability Regulation relating to verification of users, while maintaining privacy and protecting personal data.108 Having opted-in providers of free online content services are bound by the Portability Regulation in the same manner as if they were offering paid services. In line with established EU case law, Article 6 defines the scope of the Portability Regulation and exempts providers of free online content services. A provider that offers portability to its users, whether free or for payment, is within the scope of the Portability Regulation. There is no possibility to partially opt-in. The reluctance of many free online content services to opt-in reportedly links to costs for ensuring compliance, which exceeds the viability of the business model. For example, the requirement of Article 3.2 to offer portability without any additional charges, although reasonable for services offered for payment that cover costs, may seem unreasonable for services offered free that need to enhance other streams of revenue (e.g., advertising) to cover costs incurred from verification and the processing of data.109 Nothing prevents an online content service provider that is exempt from the scope of the regulation, since it offers non-payment services to its users, from choosing to provide a new service for payment to those users interested in portable services. This may be a solution for private companies that finance the service with private means and seek to cover costs. The paid service is automatically within the scope of the regulation, while the free service remains exempt. Thus, while Article 3.2 creates an obligation for services provided for payment to offer portable services, the regulation does not prevent free online content services from opting in or to prevent these actors from adopting a paid service for users interested in EU-wide or global services.

103 104 105 106 107 108 109

M. Jiménez Pumares, ‘First feedback from the implementation of the Portability Regulation by free online video services’, European Audiovisual Observatory, Strasbourg, July 2019, pp. 6–7. Ibid., p. 10. Ibid., p. 11. Ibid. Ibid., p. 13. Portability Regulation, Recital 20. Ibid., Recital 20.

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ARTICLE 7: CONTRACTUAL PROVISIONS

3. Information Before offering portability to its subscribers, and thus initiating verification of users’ residence, the 15.36 provider must inform its users and holders of third-party rights in the online content of its intention. It is enough to provide this information on the provider’s website.

ARTICLE 7: CONTRACTUAL PROVISIONS 1.

2.

Any contractual provisions, including those between providers of online content services and holders of copyright or related rights or those holding any other rights in the content of online content services, as well as those between such providers and their subscribers, which are contrary to this Regulation, including those which prohibit cross-border portability of online content services or limit such portability to a specific time period, shall be unenforceable. This Regulation shall apply irrespective of the law applicable to contracts concluded between providers of online content services and holders of copyright or related rights or those holding any other rights in the content of online content services, or to contracts concluded between such providers and their subscribers.

RELEVANT RECITALS: (5) The same applies to content, such as sports events, which is not protected by copyright or related rights under Union law but which could be protected by copyright or related rights under national law or by virtue of other specific national legislation and which is often also licensed by the organisers of such events or offered by providers of online content services on a territorial basis. Transmissions of such content by broadcasting organisations are protected by related rights which have been harmonised at Union level. Moreover, transmissions of such content often include copyright-protected elements such as music, opening or closing video sequences or graphics. Also, certain aspects of transmissions of such content, specifically those relating to broadcasting events of major importance for society as well as to short news reports on events of high interest to the public, have been harmonised by Directive 2010/13/EU of the European Parliament and of the Council(4). Finally, audiovisual media services within the meaning of Directive 2010/13/EU include services which provide access to content such as sports events, news or current affairs. (6) Increasingly, online content services are marketed in a package in which content which is not protected by copyright or related rights is not separable from content which is protected by copyright or related rights without substantially lessening the value of the service provided to consumers. This is especially the case with premium content such as sports events or other events of significant interest to consumers. In order to enable providers of online content services to provide to consumers full access to their online content services when consumers are temporarily present in a Member State other than their Member State of residence, it is indispensable that this Regulation also covers such content used by online content services and therefore that it applies to audiovisual media services within the meaning of Directive 2010/ 13/EU as well as to transmissions of broadcasting organisations in their entirety. (7) The rights in works protected by copyright and in subject-matter protected by related rights (‘works and other protected subject-matter’) are harmonised, inter alia, in Directives 96/9/ EC(5), 2001/29/EC(6), 2006/115/EC(7) and 2009/24/EC(8) of the European Parliament and of the Council. The provisions of international agreements in the area of copyright and related

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rights concluded by the Union in particular the Agreement on Trade-Related Aspects of Intellectual Property Rights annexed as Annex 1C to the Agreement establishing the World Trade Organization of 15 April 1994, the WIPO Copyright Treaty of 20 December 1996, and the WIPO Performances and Phonograms Treaty of 20 December 1996, as amended, form an integral part of the Union legal order. Union law should, insofar as is possible, be interpreted in a manner that is consistent with international law. (8) It is essential that providers of online content services that make use of works or other protected subject-matter, such as books, audiovisual works, recorded music or broadcasts have the right to use such content for the relevant territories. (9) The transmission by providers of online content services of content that is protected by copyright or related rights requires the authorisation of the relevant rightholders, such as authors, performers, producers or broadcasting organisations, regarding the content included in the transmission. This is equally true when such transmission takes place for the purpose of allowing a consumer to carry out a download in order to use an online content service. (10) The acquisition of a licence for relevant rights is not always possible, in particular when rights in content are licensed on an exclusive basis. In order to ensure that territorial exclusivity is effectively complied with, providers of online content services often undertake, in their licence contracts with rightholders, including broadcasting organisations or events organisers, to prevent their subscribers from accessing and using their services outside the territory for which the providers hold the licence. Such contractual restrictions imposed on providers require them to take measures such as disallowing access to their services from internet protocol (IP) addresses located outside the territory concerned. Therefore, one of the obstacles to the cross-border portability of online content services is to be found in the contracts concluded between the providers of online content services and their subscribers, which reflect the territorial restriction clauses included in contracts concluded between those providers and the rightholders. (11) The case law of the Court of Justice of the European Union should be taken into account when balancing the objective of protecting intellectual property rights with the fundamental freedoms guaranteed by the Treaty on the Functioning of the European Union (TFEU). (12) Therefore, the objective of this Regulation is to adapt the harmonised legal framework on copyright and related rights and to provide a common approach to the provision of online content services to subscribers temporarily present in a Member State other than their Member State of residence by removing barriers to cross-border portability of online content services which are lawfully provided. This Regulation should ensure cross-border portability of online content services in all sectors concerned and hence provide consumers with an additional means of accessing online content lawfully, without affecting the high level of protection guaranteed by copyright and related rights in the Union, without changing the existing licensing models, such as territorial licensing, and without affecting the existing financing mechanisms. The concept of cross-border portability of online content services should be distinguished from that of crossborder access by consumers to online content services provided in a Member State other than their Member State of residence, which is not covered by this Regulation. (25) Providers of online content services covered by this Regulation should not be liable for the breach of any contractual provisions that are contrary to the obligation to enable their subscribers to use such services in the Member State in which they are temporarily present. Therefore, clauses in contracts designed to prohibit or limit the cross-border portability of such online content services should be unenforceable. The providers and holders of rights relevant for the provision of online content services should not be allowed to circumvent the application of this

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ARTICLE 7: CONTRACTUAL PROVISIONS

Regulation by choosing the law of a third country as the law applicable to contracts between them. The same should apply to contracts concluded between providers and subscribers. (29) A holder of copyright, related rights, or any other rights in the content of an online content service should remain able to exercise contractual freedom to authorise such content to be provided, accessed and used under this Regulation without verification of the Member State of residence. This can be particularly relevant in sectors such as music and e-books. Each rightholder should be able to take such decisions freely when entering into contracts with providers of online content services. Contracts between providers and rightholders should not restrict the possibility for rightholders to withdraw such authorisation subject to giving reasonable notice to the provider. The authorisation given by an individual rightholder does not as such release the provider from the obligation to verify the subscriber’s Member State of residence. It is only in cases where all the holders of copyright, related rights or any other rights in the content used by the provider decide to authorise their content to be provided, accessed and used without verification of the subscriber’s Member State of residence that the obligation to verify should not apply, and the contract between the provider and the subscriber for the provision of an online content service should be used to determine the latter’s Member State of residence. All other aspects of this Regulation should remain applicable in such cases.

I. COMMENTARY 1. General scope It is clear that the effect of this provision is designed to enable providers of online content services to 15.37 offer portability of services to their users without fear of sanctions or withdrawal of copyright content owned by third parties. Current licensing structures and content markets in the European Union are based on territorial licensing models that coupled with technological geo-blocking effectively limit signals to users in specific territories.110 The broader issue relates to the distinction between justified and unjustified restrictions on free movement and access to services in the EU based on the location or nationality of the user. The CJEU in Premier League upheld the right of Member States to offer national copyright protection and territorially restrict free movement of audiovisual media content.111 Derogations from the principle of free movement is allowed only to the extent to which they are justified for the purpose of safeguarding the specific subject-matter of the rights concerned.112 The specific subject-matter of the intellectual property is intended to ensure protection of the right to exploit commercially the marketing or the making available of protected content by the grant of licences in return for payment of remuneration.113 However, it is necessary that a restriction does not go beyond what is necessary to attain the objective of protecting intellectual property.114 A restriction on fundamental freedoms is justified only where it serves overriding reasons relating to the general interest, is suitable for attaining its objective, and does not go beyond what is necessary to achieve it.115 Partitioning of national markets solely for the purpose

110 111 112 113 114 115

Geo-Blocking Regulation, Art. 3. Joined Cases C-403/08 and C-429/08 FA Premier League and others v QC Leisure and others; and Karen Murphy v Media Protection Services Ltd [2011] I-9083, para. 93. Case C-10/89 Hag GF [1990] ECR I-3711, para. 12, Case C-61/97 FDV [1998] ECR I-5171, para. 13, Case C-23/99 Commission v France [2000] ECR I-7653, para. 37. Cases 55/80 and C- 57/80, Musik-Vertrieb membran and K-tel International, [1981] ECR 147, para. 12, and Joined Cases C-92/92 and C-326/92 Phil Collins and Others [1993] ECR I-5145, para. 20. Case C-222/07 UTECA [2009] ECR I-1407, para 25, Case C-250/06 United Pan-Europe Communications Belgium and Others [2007] ECR I-11135, para. 39 and cases C-403/08 and C-429/08 Premier League, para. 105. Case C-398/95 SETTG [1997] ECR I-3091, para. 21; Case C-6/98 ARD [1999] ECR I-7599, paras 50 and 51; and Joined Cases C-94/04 and C-202/04 Cipolla and Others [2006] ECR I-11421, para. 61, Case C-250/06 United

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Chapter 15 THE PORTABILITY REGULATION

of maintaining artificial price differences is irreconcilable with the fundamental aim of the completion of an internal market. The premium price cannot be regarded as forming a part of the appropriate remuneration which the right holders must be ensured, since it is possible to take account of the potential audience when negotiating with broadcasters.116 In essence, the specific subject-matter of intellectual property owners is threatened only when a service provider communicates content to the public without authorization and without remuneration.117 15.38 The Portability Regulation targets licensing practices that lock service providers and users into a perpetual practice of blocking access to online content, unless the user is physically present in the Member State of subscription. Thus Article 7 explicitly targets contractual provisions that force service providers offering online content to limit transmission, when a subscribing user through their portable device requests access to content normally available under the subscription, while temporarily abroad.118 The exception to the principle of free movement exceeds its legitimate aim, when it links continued service to the IP address of the user and in essence limits free movement of paid services with subscribers.119 Similar licensing practices also include bulk licensing of audiovisual media content that is not subject to copyright under EU law, such as sporting events, and rely solely on contractual provisions or national law for assertion of exclusive rights and a right to remuneration. While territorial licensing remains legitimate, practices that force providers to block user access to premium content, when temporarily abroad, are not.120 It shifts practices to identification of legitimate users rather than legitimate locations of access to content. 15.39 The scope of application of the Portability Regulation limits Article 7 to contractual provisions that relate to portable services, i.e. are accessible via smart devices in the country of origin.121 If the provision of a service relies exclusively on dedicated devices, they may be unportable. This means that if a service provider decides to provide a service by means of a set-top box or a decoder, there is no obligation to offer portability to subscribers that are temporarily abroad regarding this service. The same logic also applies to functionalities. If, for example, a service provider offers its service on mobile devices such as tablets and smartphones in the Member State of residence, but decides not to allow for certain functionalities, then the service provider would be under no obligation to make this functionality available while the consumer is temporarily abroad. For example, screen mirroring or streaming of content from mobile devices to TVs or projectors are such functionalities whether or not the function requires use of particular receiving devices, such as Apple TV, Chromecast or Amazon FireTV Stick.122 However, when a service provider offers complimentary or additional portable online services with the provision of non-portable services the Portability Regulation applies, and in effect also targets contractual provisions limiting service based on location abroad.123

2. Effect of contractual provisions 15.40 The Portability Regulation applies to contracts between service providers and their users, whether they own copyright in the content or not. It also applies to contractual provisions in contracts between copyright holders and service providers. Article 7 reads in conjunction with Article 9, which voids provisions in existing agreements from the date of entry into force of the Portability

116 117 118 119 120 121 122 123

Pan-Europe Communications Belgium and Others [2007] ECR I-11135, para. 39 and Joined Cases C-403/08 and C-429/08 Premier League, para. 105. Joined Cases C-403/08 and C-429/08 Premier League, paras 115 and 119. Ibid., para. 119 distinguishing Case 62/79 Coditel and Others (‘Coditel I ’) [1980] ECR 881, paras 15 and 16. Portability Regulation, Recital 10. Ibid., Recital 10. Geo-Blocking Regulation, Art. 3. Portability Reguation, Art. 1 and Recital 1. Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, note 42. Ibid.

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ARTICLE 8: PROTECTION OF PERSONAL DATA

Regulation, thus forces copyright owners to either withdraw authorization, renegotiate the contract or the original contract remains without the provisions contrary to Article 7. Thus, the copyright owner may decide whether to authorize the use of content. Once authorization has been given (and remuneration agreed) portability of services may not be lawfully excluded by contract either indirectly mandating service providers to prevent use, or in effect by preventing users accesssing services from abroad.

3. Scope of regulation Contractual provisions limiting the right of service providers to offer cross-border portability to its 15.41 users are ineffective, regardless of the national law applicable to the contract. The provision is designed to avoid forum shopping, and to prevent content owners from leveraging the exclusive right to content in similar provisions in end-user agreements between the content service providers and their subscribers, in the specific manner explained above.124

ARTICLE 8: PROTECTION OF PERSONAL DATA 1.

2.

3.

The processing of personal data carried out within the framework of this Regulation including, in particular, for the purposes of verification of the subscriber’s Member State of residence under Article 5, shall be carried out in compliance with Directives 95/46/EC and 2002/58/EC. In particular, the use of the means of verification in accordance with Article 5 and any processing of personal data under this Regulation, shall be limited to what is necessary and proportionate in order to achieve its purpose. Data collected pursuant to Article 5 shall be used solely for the purpose of verifying the subscriber’s Member State of residence. They shall not be communicated, transferred, shared, licensed or otherwise transmitted or disclosed to holders of copyright or related rights or to those holding any other rights in the content of online content services, or to any other third parties. Data collected pursuant to Article 5 shall not be stored by the provider of an online content service longer than necessary to complete a verification of a subscriber’s Member State of residence pursuant to Article 5(1) or (2). On completion of each verification, the data shall be immediately and irreversibly destroyed.

RELEVANT RECITAL: (30) This Regulation respects fundamental rights and observes the principles recognised in the Charter of Fundamental Rights of the European Union (‘Charter’). Accordingly, this Regulation should be interpreted and applied in accordance with those rights and principles, in particular the right to respect for private and family life, the right to protection of personal data, the right to freedom of expression, the freedom to conduct a business and the right to property, including intellectual property. Any processing of personal data under this Regulation should respect fundamental rights, including the right to respect for private and family life and the right to protection of personal data under Articles 7 and 8 of the Charter, and it is essential that such processing be in compliance with Directives 95/46/EC and 2002/58/EC. In particular, providers of online content services should ensure that any processing of personal data under this Regulation is necessary, reasonable and proportionate in order to achieve the relevant purpose. Where authentication of a subscriber is sufficient in order to provide the service, identification

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Portability Regulation, Recital 25.

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of the subscriber should not be required. Data collected pursuant to this Regulation for the purposes of verification of the Member State of residence should not be stored by the provider longer than necessary to complete such verification. Such data should be immediately and irreversibly destroyed after the verification is completed. However, this is without prejudice to the storage of data which was collected for another legitimate purpose, subject to applicable data protection rules, including rules concerning the storage of that data.

I. COMMENTARY 1. Collecting data 15.42 The respect of fundamental rights is ensured in the Charter of Fundamental Rights of the European Union. In particular, the right to respect for private and family life (Art. 7) and the right to protection of personal data (Art. 8), are paramount in any processing or collection of personal data in the European Union. Processing of data is comprehensively regulated by Directive 2002/58/ EC and Regulation (EU) 2016/679 (repealing Directive 95/46/EC) and the principles therein govern collection, use and destruction of data also in respect of the Portability Regulation.125 Under these rules, data is categorized as either traffic data, which is any data processed for the purpose of conveying electronic communications or for billing purposes; or location data, which refers to any data processed that indicates the geographic position of the user’s communications device.126 Processing of data should follow the principle of data minimization, meaning that data collection should be adequate, relevant and limited to what is necessary in relation to the purpose for which data is processed.127 Where authentication of a subscriber is enough in order to provide the service, identification of the subscriber should not be required.128 The principle of purpose limitation limits data collection to specific, explicit and legitimate purposes and prohibits further processing in a manner incompatible with those purposes.129 In particular, providers of online content services should ensure that any collection and processing of personal data under this Regulation is necessary, reasonable and proportionate in order to achieve the relevant purpose.130

2. Use of data 15.43 Everyone has the right to the protection of personal data concerning oneself.131 All data should be processed lawfully, fairly and in a transparent manner in relation to the data subject.132 This means that data can only be processed based on the individual’s informed consent, or on a legitimate basis laid down by law. In combination with the respect for other fundamental rights, such as respect for private and family life and protection of freedom of expression, collected data may not be transferred to third parties.133 The service provider must take appropriate technical and organizational measures

125

126 127 128 129 130 131 132 133

Directive on Privacy and Electronic Communications. Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data ([1995] OJ L 281/31) was repealed 24/05/2018 (32016R0679) by Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) ([2016] OJ L 119/1; cor. OJ L 1272). Directive on Privacy and Electronic Communications, Art. 2(b) and (c). General Data Protection Regulation, Art. 5.1(c). Portability Regulation, Recital 30. General Data Protection Regulation, Art. 5.1(b). Portability Regulation, Recital 30. Charter of Fundamental Rights of the European Union, Art. 8.1. General Data Protection Regulation, Art. 5.1(a). Charter of Fundamental Rights of the European Union, Arts. 7 and 11.

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ARTICLE 9: APPLICATION TO EXISTING CONTRACTS AND RIGHTS ACQUIRED

to safeguard the security of its services at a level of security appropriate to the risk presented.134 In particular confidentiality of communications, including traffic data, must be secured, preventing unauthorized access to it by others than the person concerned.135 Processing is lawful when it is necessary for compliance with a legal obligation, such as the one laid down in Article 3 of the Portability Regulation and for the performance of a contract at the data subject’s request.136 This is in line with securing the fundamental rights of service providers, in particular the freedom to conduct a business in accordance with laws and practices, as ensured in Article 16 of the Charter of Fundamental Rights in the European Union. While the same Charter protects the right to property, including intellectual property, the interests of holders of copyright to maintain and extract value from audiovisual media and other protected content is limited by protection of personal data of users. Thus, while service providers under Article 5.3 of the Portability Regulation may check the IP address of the subscriber, if there are reasonable doubts as to the accuracy of other information, the only purpose of an IP address check is to ensure the location where the subscriber primarily uses the online content services. This data may not be used for other purposes than verification, for example to ensure protection of property, or intellectual property rights.

3. Destroying data All data must be erased or made anonymous when it is no longer needed.137 This requires ensuring 15.44 that the period for which personal data is stored is limited to a strict minimum. The service provider should establish time limits for erasure or periodic review, in order to ensure proper data destruction.138 Data should be immediately and irreversibly destroyed after the verification is completed. However, this is without prejudice to the storage of data which was collected for another legitimate purpose.139 Procedures as well as assigning an authority to supervise compliance must be regulated by national law.140

ARTICLE 9: APPLICATION TO EXISTING CONTRACTS AND RIGHTS ACQUIRED 1. 2.

134 135 136 137 138 139 140

This Regulation shall apply also to contracts concluded and rights acquired before the date of its application if they are relevant for the provision of, access to and use of an online content service, in accordance with Articles 3 and 6, after that date. By 2 June 2018, the provider of an online content service provided against payment of money shall verify, in accordance with this Regulation, the Member State of residence of those subscribers who concluded contracts for the provision of the online content service before that date. Within two months of the date upon which the provider of an online content service provided without payment of money first provides the service in accordance with Article 6, the provider shall verify, in accordance with this Regulation, the Member State of residence of those subscribers who concluded contracts for the provision of the online content service before that date.

Directive on Privacy and Electronic Communications, Art. 4. Directive on Privacy and Electronic Communications, Art. 5, General Data Protection Regulation, Recital 39. General Data Protection Regulation, Art. 6 (b) and (c). Directive on Privacy and Electronic Communications, Arts 6.1 and 9.1. General Data Protection Regulation, Recital 39. Portability Regulation, Recital 30. General Data Protection Regulation, Arts 51 and 58.

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Chapter 15 THE PORTABILITY REGULATION

RELEVANT RECITALS: (31) Contracts under which content is licensed are usually concluded for a relatively long duration. Consequently, and in order to ensure that all consumers residing in the Union can enjoy cross-border portability of online content services on an equal basis in time and without any undue delay, this Regulation should also apply to contracts concluded and rights acquired before the date of its application if those contracts and rights are relevant for the cross-border portability of an online content service provided after that date. Such application of this Regulation is also necessary in order to ensure a level playing field for providers of online content services covered by this Regulation operating in the internal market, particularly for SMEs, by enabling providers that concluded contracts with rightholders for a long duration to offer cross-border portability to their subscribers, independently of the provider’s ability to renegotiate such contracts. Moreover, such application of this Regulation should ensure that when providers make arrangements necessary for the cross-border portability of their services, they will be able to offer such portability with regard to the entirety of their online content. This should also apply to providers of online content services that offer packages combining electronic communications services and online content services. Finally, such application of this Regulation should also allow rightholders not to have to renegotiate their existing licensing contracts in order to enable providers to offer cross-border portability of their services. (32) Accordingly, since this Regulation will apply to some contracts concluded and rights acquired before the date of its application, it is also appropriate to provide for a reasonable period between the date of entry into force of this Regulation and the date of its application, so as to allow rightholders and providers of online content services covered by this Regulation to make the arrangements necessary to adapt to the new situation, as well as to allow providers to amend the terms of use of their services. Changes to the terms of use of online content services offered in packages combining an electronic communications service and an online content service that are made strictly in order to comply with the requirements of this Regulation should not trigger for subscribers any right under national laws transposing the regulatory framework for electronic communications networks and services to withdraw from contracts for the provision of such electronic communications services.

I. COMMENTARY 1. Application 15.45 In order to prevent circumvention of Article 7 the Regulation applies to existing contracts concluded with copyright owners prior to the entry into force of the Portability Regulation. Naturally, this applies only to contracts authorizing use of content on portable devices. This is in line with the spirit of the Portability Regulation to allow users access to the same content they are already paying for without additional charges. Extensive renegotiation of existing contracts would create costs for all parties.

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ARTICLE 11: FINAL PROVISIONS

2. Transition A three-month transition period was introduced to allow for technical arrangements and revision of 15.46 end-user licence agreements. The initial period 21 March 2018 was extended to 2 June 2018.141

ARTICLE 10: REVIEW By 2 April 2021, and as required thereafter, the Commission shall assess the application of this Regulation in the light of legal, technological and economic developments, and submit to the European Parliament and to the Council a report thereon. The report referred to in the first paragraph shall include, inter alia, an assessment of the application of the verification means of the Member State of residence referred to in Article 5, taking into account newly developed technologies, industry standards and practices, and, if necessary, consider the need for a review. The report shall pay special attention to the impact of this Regulation on SMEs and the protection of personal data. The Commission’s report shall be accompanied, if appropriate, by a legislative proposal.

I. COMMENTARY The initial period for review was marked 21 March 2021 and was extended to 2 April 2021.142

15.47

ARTICLE 11: FINAL PROVISIONS 1. 2.

This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. It shall apply from 1 April 2018.

This Regulation shall be binding in its entirety and directly applicable in all Member States

I. COMMENTARY The entry into force of the regulation was postponed from 20 March 2018 to 1 April 2018.143

15.48

NOTES 1. Related instruments Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of Regions, COM (2015) 192 final. Charter of Fundamental Rights of the European Union, [2000] OJ C 364/1. Consolidated versions of the Treaty on European Union and the Treaty on the Functioning of the European Union – Consolidated version of the Treaty on the Functioning of the European Union – Protocols – Annexes –

141

142 143

Corrigendum to Regulation (EU) 2017/1128 of the European Parliament and of the Council of 14 June 2017 on cross-border portability of online content services in the internal market Corrigendum, [2017] OJ L 198/42 (2017/1128). Ibid. Ibid.

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Chapter 15 THE PORTABILITY REGULATION Declarations annexed to the Final Act of the Intergovernmental Conference which adopted the Treaty of Lisbon, signed on 13 December 2007 – Tables of equivalences, [2012] OJ C 326. Corrigendum to Regulation (EU) 2017/1128 of the European Parliament and of the Council of 14 June 2017 on cross-border portability of online content services in the internal market Corrigendum, [2017] OJ L 198/42. Directive 2010/13/EU of the European Parliament and of the Council of 10 March 2010 on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the provision of audiovisual media services (Text with EEA relevance), [2010] OJ L 95/1. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, [2001] OJ L 167/10. Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector, [2002] OJ L 201/37. Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data ([1995] OJ L 281/31) repealed 24/05/2018 (32016R0679) by Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC, [2016] OJ L 119/1; cor. [2018] OJ L 127/2. Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related right and multi-territorial licensing of rights in musical works for online use in the internal market [2014] OJ L 84/72. Flash Eurobarometer 477a, ‘Accessing content online and cross-border portability of online content services’, April 2019. Letter to the attention of the competent national authorities on the application of Regulation (EU) 2017/1128, 1.6.2018. Opinion of the associated Committee on Culture and Education in the European Parliament supports this conclusion in Report of 15 July 2016 on the proposal for a regulation of the European Parliament and of the Council on ensuring the cross-border portability of online content services in the internal market, A8-0378/2016. Regulation (EU) 2018/302 of the European Parliament and of the Council of 28 February 2018 on addressing unjustified geo-blocking and other forms of discrimination based on customers’ nationality, place of residence or place of establishment within the internal market and amending Regulations (EC) No 2006/2004 and (EU) 2017/2394 and Directive 2009/22/EC, [2018] OJ L 601/1. Regulation (EU) 2017/1128 of the European Parliament and of the Council of 14 June 2017 on cross-border portability of online content services in the internal market, [2017] OJ L 168/1. Regulation (EU) No 910/2014 of the European Parliament and of the Council of 23 July 2014 on electronic identification and trust services for electronic transactions in the internal market and repealing Directive 1999/93/EC, [2014] OJ L 257/73.

2. Case law Case C-355/98 Commission v Belgium [2000] ECR I-1221. Case C-348/96 Calfa [1999] ECR I-11. Case C-212/97 Centros v Erhvervs-og Selskabsstyrelsen [1999] ECR I-1459. Case 33/74 Van Binsbergen v Bestuur van de Bedrijfsvereniging [1974] ECR 1299. Case C-23/93 TV 10 SA v Commissariaat voor de Media [1994] ECR I-4795. Cases C-403/08 and C-429/08 FA Premier League and others v QC Leisure and others; and Karen Murphy v Media Protection Services Ltd [2011] I-9083. Case C-10/89 Hag GF [1990] ECR I-3711. Case C-61/97 FDV [1998] ECR I-5171. Case C-23/99 Commission v France [2000] ECR I-7653. Cases 55/80 and C- 57/80 Musik-Vertrieb membran and K-tel International [1981] ECR 147. Joined Cases C-92/92 and C-326/92 Phil Collins and Others [1993] ECR I-5145. Case C-222/07 UTECA [2009] ECR I-1407. Case C-250/06 United Pan-Europe Communications Belgium and Others [2007] ECR I-11135. Case C-398/95 SETTG [1997] ECR I-3091. Case C-6/98 ARD [1999] ECR I-7599. Joined Cases C-94/04 and C-202/04 Cipolla and Others [2006] ECR I-11421. Case 62/79 Coditel and Others (‘Coditel I’) [1980] ECR 881. Case C-582/14 Patrick Breyer v Bundesrepublik Deutschland ECLI:EU:C:2016:779.

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ARTICLE 11: FINAL PROVISIONS

3. Bibliography Jiménez Pumares, M. ‘First feedback from the implementation of the Portability Regulation by free online video services’, European Audiovisual Observatory. Mazziotti, G. ‘Allowing online content to cross borders: is Europe really paving the way for a Digital Single Market?’ in T. Pihlajarinne, J. Vesala and O. Honkkila (eds) Online Distribution of Content in the EU, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA (2019), p. 191.

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16 THE MARRAKESH TREATY ON CERTAIN PERMITTED USES FOR THE BENEFIT OF BLIND, VISUALLY IMPAIRED AND PRINT-DISABLED PERSONS Raquel Xalabarder I.

THE MARRAKESH TREATY (2013)

16.01

DIRECTIVE (EU) 2017/1564 I.

INTRODUCTION

16.20

COMMENTARY 1. Human rights and copyright 2. Relationship between the Directive and the Regulation 3. Subsidiarity and proportionality principles

16.29 16.32

COMMENTARY 1. Works or other subject matter 2. Beneficiary person 3. Accessible format copy 4. Authorized entities COMMENTARY 1. A mandatory exception 2. Scope of permitted uses 3. Conditions 4. Three-step test 5. Compensation not required, but possible (only for national AEs) 6. Prohibition on imposing additional requirements (no prior checking of commercial availability) 7. Protection of TPM but no contractual override of E&L

COMMENTARY 1. Cross-border exchange of AFC within the internal market

COMMENTARY

16.119

ARTICLE 7: PROTECTION OF PERSONAL DATA I.

COMMENTARY

16.122

16.40

I.

COMMENTARY

16.124

ARTICLE 9: REPORT 16.43 16.43 16.52 16.55 16.58

I.

COMMENTARY

16.130

ARTICLE 10: REVIEW I.

COMMENTARY

16.134

ARTICLE 11: TRANSPOSITION I.

COMMENTARY

16.138

16.61 16.61 16.64 16.69 16.74

ARTICLE 12: ENTRY INTO FORCE

16.76

ARTICLE 1: SUBJECT MATTER AND SCOPE

ARTICLE 13: ADDRESSEES REGULATION (EU) 2017/1563 I.

COMMENTARY

I.

16.144

COMMENTARY

16.147

16.80

ARTICLE 2: DEFINITIONS

16.84

ARTICLE 3: EXPORT OF ACCESSIBLE FORMAT COPIES TO THIRD COUNTRIES

ARTICLE 4: ACCESSIBLE FORMAT COPIES IN THE INTERNAL MARKET I.

ARTICLE 6: TRANSPARENCY AND EXCHANGE OF INFORMATION

ARTICLE 8: AMENDMENT TO DIRECTIVE 2001/29/EC

ARTICLE 3: PERMITTED USES I.

16.108

16.37

ARTICLE 2: DEFINITIONS I.

COMMENTARY

I.

ARTICLE 1: SUBJECT MATTER AND SCOPE I.

I.

ARTICLE 4: IMPORT OF ACCESSIBLE FORMAT COPIES FROM THIRD COUNTRIES 16.98

I.

COMMENTARY 1. Same conditions under national law 2. Restrictions on the use of AFC in ‘Berne-gap’ countries 3. Cross-border exchange with nonsignatory countries

16.99

ARTICLE 5: OBLIGATIONS OF AUTHORISED ENTITIES

16.150 16.153 16.162 16.165

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I. THE MARRAKESH TREATY (2013) ARTICLE 5: OBLIGATIONS OF AUTHORISED ENTITIES ARTICLE 6: PROTECTION OF PERSONAL DATA

ARTICLE 7: REVIEW ARTICLE 8: ENTRY INTO FORCE AND APPLICATION

I. THE MARRAKESH TREATY (2013) The Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, 16.01 Visually Impaired, or Otherwise Print Disabled (hereinafter MT)1 was adopted by the WIPO Member States on 27 June 2013, to improve access to books and other printed works for persons with print disabilities. The Marrakesh Treaty entered into force on 30 September 2016 – three months after achieving 20 ratification instruments on 30 June 2016.2 As of May 2020, 65 countries have ratified the Marrakesh Treaty. It is open to any WIPO Member State or other intergovernmental organizations authorized by its Assembly of Contracting Parties; there is no requirement to be a member of any other international copyright treaty in order to join the Marrakesh Treaty. Worldwide, there are more than 285 million blind and visually impaired persons (hereinafter VIP), 16.02 90 per cent of whom live in developing countries. According to the World Blind Union (WBU), less than 5 per cent of books published every year worldwide are made available in formats accessible to VIPs, and, overall, less than 10 per cent of all published materials can be read by blind or VIPs. This is commonly referred to as the ‘global book famine’. The lack of books in accessible formats becomes a real obstacle for VIPs to getting an education, 16.03 diminishing their chances of getting a job and leading an independent life. Human rights play a fundamental role in justifying the need for this Treaty. The Marrakesh Treaty demonstrates that copyright also has a role to play in securing a better, more equitable world. Exceptions and Limitations (E&L) have never been a priority for international copyright instru- 16.04 ments. Based on the specific social and economic needs of each country, copyright E&L have traditionally been a matter for national laws. International instruments have not only permitted but promoted this result. Both the Berne Convention (BC) and the Rome Convention formally empower national legislators to provide for exceptions and limitations to the rights granted by them, for purposes of quotations (a mandatory exception under Art.10.1 BC), as well as for other purposes such as private use, the reporting of current events, ephemeral fixations by broadcasting organizations, and purposes of teaching or scientific research (i.e., Art.10.2 BC, Art.15 Rome Convention). Similarly, the 1996 WCT and WPPT instruments recognized in their preambles the need ‘to maintain a balance between the rights of authors and the larger public interest, particularly education, research and access to information’, and confirmed that E&L (extending the existing E&L to the digital environment, as well as devising new ones) remained a matter for national laws, under the guidance of the three-step test: in certain special cases, when they do not conflict with a normal exploitation of the work (or other protected subject matter) and do not unreasonably prejudice the legitimate interests of the author (or right owners).3

1 2

3

The Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired, or Otherwise Print Disabled of 2013: https://www.wipo.int/treaties/en/ip/marrakesh/. The first 20 countries to ratify or accede to the Marrakesh Treaty were: India, El Salvador, the United Arab Emirates, Mali, Uruguay, Paraguay, Singapore, Argentina, Mexico, Mongolia, the Republic of Korea, Australia, Brazil, Peru, the Democratic People’s Republic of Korea, Israel, Chile, Ecuador, Guatemala and Canada. See Art. 9.2 BC, Art. 10 WCT and Art. 16 WPPT.

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Chapter 16 THE MARRAKESH TREATY

16.05 In 2002, E&L caught WIPO’s attention. In November 2002, the issue was included in a ‘Short Description of Possible Subjects for Future Review by the Standing Committee’ prepared by the Secretariat (SCCR/8/2).4 In June 2003, Prof. Sam Ricketson’s ‘WIPO Study on Limitations and Exceptions of Copyright and Related Rights in the Digital Environment (SCCR/9/7)’,5 examining E&L in the digital environment as viewed through the different WIPO-administered treaties, was submitted to the consideration of the SCCR. In November 2004, Chile unexpectedly introduced ‘the subject of exceptions and limitations to copyright and related rights for the purposes of education, libraries and disabled people’ (document SCCR/12/3) in the agenda of the 12th session of the SCCR. The purpose of the proposal was to ‘find a formula that permitted all the countries to exercise minimum exceptions relating to the visually impaired, public library institutions and distance education’.6 Despite there having been no time to fully assess it, the majority of countries welcomed and supported the proposal.7 So did NGOs, including the WBU, and the UNESCO representative expressed its will to collaborate with the process, finding E&L a very important and sensitive issue and recognizing WIPO as the best platform to open a debate on it.8 16.06 Let us bear in mind that that same year, at the WIPO General Assembly, Argentina and Brazil proposed the establishment of a ‘Development Agenda for WIPO’ (WO/GA/31/11), which led to the adoption in 2007 of the WIPO Recommendations for the Development Agenda.9 The Marrakesh Treaty recalls in its preamble ‘the importance of the Development Agenda recommendations, adopted in 2007’. 16.07 At the next (13th) SCCR, in 2005, the consensus among delegates was favourable to continue working on the issue of E&L. Non-governmental representatives, such as the Council of Audiovisual Archives Associations (CCAAA) and the International Federation of Library Associations and Institutions (IFLA) were also in support, viewing the SCCR as ‘the active custodian of the balance between the rights of authors and the greater public interest’.10 The WBU also urged WIPO to take action against ‘the acute shortage of accessible books and other published material, … attributable to legal, economic and technological problems, including the territorial nature of copyright exceptions’.11 16.08 Based on this mandate, the Secretariat commissioned a series of studies on E&L. Among them, a WIPO Study (2006) written by J. Sullivan ‘Study on Copyright Limitations and Exceptions for the visually Impaired’,12 found that only a few countries provided for E&L in their national copyright laws to allow for the making of accessible format copies (AFC) for the benefit of VIPs, such as Braille, large print or digitized audio versions of copyrighted works. The Study analysed specific exceptions for the benefit of VIPs in 58 national laws and presented several case studies to illustrate problems concerning the production and dissemination of accessible copies of copyrighted works for visually impaired people, including cross-border movement of these copies. Because copyright law is ‘territorial’, accessible copies produced in one country under an E&L can only be enjoyed within 4 5 6 7

8 9 10 11 12

https://www.wipo.int/meetings/en/details.jsp?meeting_id=4692. https://www.wipo.int/meetings/en/doc_details.jsp?doc_id=16805. The proposal did not clarify whether it envisaged a mere declaration of principles or the adoption of an international instrument. Express support was offered by India, Argentina, Paraguay, Syrian Arab Republic, Uruguay, Islamic Republic of Iran, Brazil, Egypt, Costa Rica, Algeria, Dominican Republic, Senegal, Bangladesh, Morocco, Jordan and China (referring to Art. 27 of the United Nations Declaration of Human Rights). See Report adopted by the Committee, SCCR/12/4. Ibid. https://www.wipo.int/ip-development/en/agenda/recommendations.html. See Report prepared by the Secretariat, SCCR/13/6 # 20; available at https://www.wipo.int/meetings/en/doc_details. jsp?doc_id=62952. Ibid., # 21. See Report prepared by the Secretariat, SCCR/15/7; available at https://www.wipo.int/edocs/mdocs/copyright/en/sccr_15/ sccr_15_7.pdf.

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I. THE MARRAKESH TREATY (2013)

that country and cannot be ‘exported’ to another country, even when providing for a similar E&L. VIPs and organizations must negotiate licenses with rightholders to ‘exchange’ these copies across borders, or make new accessible copies resulting in an inefficient investment of time and money that aggravates the ‘book famine’. In 2008, building upon the Chilean one, another Proposal13 aimed at a plan to achieve an 16.09 international consensus on minimum mandatory exceptions and limitations (particularly with regard to educational activities, people with disabilities, libraries and archives, as well as exceptions that foster technological innovation). The schism of VIPs from the other E&L started in 2009, at the 17th SCCR, when the Committee: acknowledged the special needs of visually impaired persons and stressed the importance of dealing, without delay and with appropriate deliberation, with those needs of the blind, visually impaired, and other reading-disabled persons, including discussions at the national and international level on possible ways and means facilitating and enhancing access to protected works. (emphasis added)14

Later that year, the WBU submitted a ‘Treaty proposal’ via the delegations of Brazil, Ecuador and Paraguay.15 This ignited a cascade of further Treaty proposals and comments,16 and the establishment of the Stakeholders’ Platform at WIPO,17 building momentum for an international instrument and leading to the Diplomatic Conference18 in Marrakesh where the rara avis of the WIPO Marrakesh Treaty was adopted.

13

14 15 16

17

18

See (2008) Proposal by Brazil, Chile, Nicaragua and Uruguay for Work Related to Exceptions and Limitations (SCCR/16/2) consisting of four phases: first, to identify the availability, scope and nature of E&L currently present in international treaties and conventions, as well as in Member States’ national laws; second, to discuss and evaluate the justifications and implications for E&L in the areas prioritized by Member States; third, to select and delimit those E&L ‘that should form part of a prescriptive minimum global framework of exceptions, and also identify models for other exceptions that should be considered best practices’; and ‘finally, the Committee should adopt a formal recognition of, and commitment to creating mandatory minimum exceptions and limitations through means it deems appropriate. For instance, this could take the form of a recommendation for action to be adopted by the WIPO General Assembly.’ See (2008) Conclusions of the Seventeenth Session of the SCCR prepared by the Chair (SCCR/17/5). See (2009) Proposal by Brazil, Ecuador and Paraguay, relating to Limitations and Exceptions: Treaty Proposed by the World Blind Union (WBU) (SCCR/18/5). See Proposal of the United States of America for a Consensus Instrument (document SCCR/20/10); Draft WIPO Treaty on Exceptions and Limitations for the Disabled, Educational and Research Institutions, Libraries and Archive Centers (Africa Group) (document SCCR/20/11); Draft Joint Recommendation concerning the improved access to works protected by copyright for persons with a print disability (European Union) (document SCCR/20/12); Comparative List of Proposals Related to Copyright Limitations and Exceptions for the Visually Impaired Persons and Other Persons with Print Disabilities, prepared by the Secretariat (SCCR/22/8); Consensus document on an international instrument on limitations and exceptions for persons with print disabilities presented by Argentina, Australia, Brazil, Chile, Ecuador, Mexico, Paraguay, and the United States of America (SCCR/22/15); Proposal on an international instrument on limitations and exceptions for persons with print disabilities document presented by Argentina, Australia, Brazil, Chile, Colombia, Ecuador, the European Union and its Member States, Mexico, Norway, Paraguay, the Russian Federation, the United States of America and Uruguay (SCCR/22/15 REV. 1); Proposal of the SCCR Chair on an international instrument on limitations and exceptions for persons with print disabilities (document SCCR/22/16); Working Document on an International Instrument on Limitations and Exceptions for Visually Impaired Persons / Persons with Print Disabilities, adopted by the Committee (SCCR/23/7); Revised Working Document on an International Instrument on Limitations and Exceptions for Visually Impaired Persons/Persons with Print Disabilities (SCCR/24/9); Draft Text of an International Instrument / Treaty on Limitations and Exceptions for Visually Impaired Persons / Persons with Print Disabilities, adopted by the Committee (SCCR/25/2 rev). The meetings of the Stakeholders’ Platform took place as follows: First meeting in Geneva, on 19 January 2009; Second meeting in London, on 20 April 2009; Third meeting in Alexandria (Egypt), on 3 November 2009; Fourth meeting in Geneva, on 26 May 2010; Fifth meeting in New Delhi, on 23 October 2010. See Interim Reports SCCR/18/4, SCCR/19/10, SCCR/20/6, SCCR/21/10 and SCCR/24/2) – no Stakeholders’ Platform meetings were organized in 2011. Diplomatic Conference to conclude a Treaty to facilitate Access to Published Works by Visually Impaired Persons and Persons with Print Disabilities (June 2013, Marrakesh); available at https://www.wipo.int/meetings/en/details. jsp?meeting_id=28722.

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Chapter 16 THE MARRAKESH TREATY

16.10 After years of frantic activity involving the negotiation of the Marrakesh Treaty, work on other E&L continued at the SCCR, albeit with a very different pace and success. Stakeholders’ meetings and multiple studies have contributed to a rich and rewarding debate also at the SCCR, but it is unlikely that any other treaty on E&L will soon see the light. 16.11 The Marrakesh Treaty obliges contracting parties to implement E&L to allow the making and obtaining of AFC of works to be used for VIPs; contracting parties may implement these obligations according to ‘their own legal systems and practices’. The Marrakesh Treaty also aims at fostering the cross-border exchange of AFC between contracting parties, so as to avoid inefficiency and duplication of investment.19 16.12 The Marrakesh Treaty is a copyright instrument, and as such is understood to be in conformity with Article 20 BC, which allows Union countries to ‘enter into special agreements among themselves, in so far as such agreements grant to authors more extensive rights than those granted by the Convention or contain other provisions not contrary to this Convention’. Any doubts regarding the establishment of mandatory E&L and its conformity with the BC were, thus, overcome.20 16.13 The uniqueness of the Marrakesh Treaty should not be underestimated. On the one hand, because it is the first (so far, only) international treaty on copyright E&L. On the other, because it overcomes the very principle of territoriality upon which all international treaties have been built. The Marrakesh Treaty goes beyond national treatment and lex loci protectionis, to facilitate the cross-border exchange of AFC. 16.14 The WIPO Stakeholders Platform (2009–12) evolved to a permanent structure, the Accessible Books Consortium (ABC): a multi-stakeholder (Public–Private) partnership launched by WIPO in June 2014.21 The WBU, libraries for the blind, standards bodies, Collective Management Organizations and IPA are all part of the ABC. 16.15 The ABC plays a relevant role in the implementation of the Marrakesh Treaty, especially (but not only) regarding the ‘cross-border’ exchange of AFC. The ABC offers an international database and book exchange service: the Global Book Service (GBS), hosted at WIPO and initially called TIGAR (Trusted Intermediary Global Accessible Resources), which enables secure and transparent file exchange among participating institutions and aims at becoming the premier repository of accessible titles in the world. The ABC also helps increase the availability of books in accessible formats, by developing capacity-building initiatives that provide training in accessible book production and distribution and the promotion of inclusive publishing standards. 16.16 The GBS sets out the conditions for participants for the exchange of AFC of copyrighted materials amongst participating institutions.22 Originally, the TIGAR had been requesting permission from copyright holders for the cross-border exchange of electronic files of accessible books that had already been produced legitimately by an institution (be it under a national copyright exception or a license). As the Marrakesh Treaty entered into force and more countries implement it, this permission is no longer required for the ‘cross-border’ transfer of AFC files among Marrakesh

19 20

21 22

See Helfer #2.6.2.1. See von Lewinski #18.0.32–33 explains several justifications to avoid a conflict with Art.20 BC: arguing that the Marrakesh Treaty only imposes ‘soft obligations’ on Union members since access to it is voluntary (there is no obligation on Berne Union Members to ratify it); and the possibility of making a declaration, upon accessing the Marrakesh Treaty, that Arts 4–6 of the Treaty are not recognized as mandatory. See also Ficsor, Art. 22 notes 6–7, pp. 63–4. See www.accessiblebooksconsortium.org. To participate in this service, an institution must enter into an agreement with WIPO to ensure that it has adequate security mechanisms in place to prevent unauthorized access to electronic files of accessible books that it has received; and it does not make a profit through the distribution of electronic files of accessible books.

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I. THE MARRAKESH TREATY (2013)

Treaty countries. Since the GBS is not restricted to participating institutions of Marrakesh Treaty countries, permission may still be required for some ‘cross-border’ exchange of AFC. The European Union (EU) played an active role in the negotiation of the Marrakesh Treaty and 16.17 ratified it on 1 October 2018, also on behalf of its Member States. For purposes of the EU, the implementation of the Marrakesh Treaty involves obligations that affect the making and ‘crossborder’ exchange of AFC within the internal market, as well as the cross-border exchange of AFC with other signatory countries outside the internal market. Two different instruments were necessary for its implementation: a Directive and a Regulation. Directive (EU) 2017/1564 of the European Parliament and of the Council of 13 September 2017 16.18 on certain permitted uses of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled and amending Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society (OJEU L.242/6, of 20.09.2017) [hereinafter, MTD]. Regulation (EU) 2017/1563 of the European Parliament and of the Council of 13 September 2017 16.19 on the cross-border exchange between the Union and third countries of accessible format copies of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled (OJEU L.242/1, of 20.09.2017) [hereinafter, MTR].

NOTES 1. Bibliography Helfer, L., et al, The World Blind Union Guide to the Marrakesh Treaty, OUP (2017). von Lewinski, S., ‘Chapter 18: The Marrakesh Treaty’ in J. Reinbothe and S. Von Lewinski, The WIPO Treaties on Copyright – A commentary on the WCT, the WPPT, and the BTAP, OUP, 2nd ed. (2015).

DIRECTIVE (EU) 2017/1564 on certain permitted uses of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise printdisabled and amending Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society

I. INTRODUCTION The Marrakesh Treaty Directive and Regulation faithfully implement the obligations adopted by 16.20 the EU under the Marrakesh Treaty. In a few specific aspects, the EU provisions go beyond the minimum scope required by the Marrakesh Treaty. A mandatory exception is imposed by the MTD on all EU Member States, leaving very little room 16.21 for national choices and securing that the scope of uses for the benefit of VIPs permitted in all EU countries will be essentially the same. The VIP mandatory exception extends to ‘print works’ (textual works) as well as to other protected 16.22 subject matter, namely, related rights on performances and productions (such as audiobooks).

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16.23 The VIP mandatory exception covers all the exploitation rights that have been harmonized by EU acquis, thus – in addition to reproduction, distribution and making available online (as provided for by the Marrakesh Treaty) – the VIP exception also affects rental and lending rights, any kind of communication to the public (such as public performance and transmission by satellite and cable), as well as the sui generis right on databases. 16.24 Compensation is not required; it is optional for Member States. Any compensation required by a national law can only be applied to authorized entities (AEs) established in that country (compensation cannot be required from VIPs or from AEs established in other countries). 16.25 Member States cannot impose any other requirements. This prohibition specifically applies to checking the commercial availability of AFCs of a work as a condition prior to making and circulating the AFC; similarly, the same applies for the import of AFCs from other AEs, be it within the same country or from a different country (EU or not). 16.26 The uses permitted under the VIP mandatory exception cannot be overridden by contract; yet, TPMs may de facto restrict them, as a result of the vague and insufficient Article 6(4) ISD. 16.27 Authorized entities established in EU countries must publish information regarding the fulfilment of their obligations and may be requested to provide more detailed information regarding AFC works and formats available as well as regarding other AEs with which AFC have been exchanged. 16.28 Because of its mandatory nature, if a Member State failed to formally implement the VIP exception into national law by 11 October 2018, or did not correctly implement it, the mandatory provisions in the Directive will directly apply in that country.

ARTICLE 1: SUBJECT MATTER AND SCOPE This Directive aims to further harmonise Union law applicable to copyright and related rights in the framework of the internal market, by establishing rules on the use of certain works and other subject matter without the authorisation of the rightholder, for the benefit of persons who are blind, visually impaired or otherwise print-disabled.

I. COMMENTARY 16.29 The European Union played an active role in the negotiation of the Marrakesh Treaty. On 30 April 2014, the Greek Presidency of the Council of the European Union signed it on behalf of the EU.23 The signing of the Treaty had been authorized by Council Decision 2014/221/EU of 14 April 2014, relying on the EU’s exclusive competence to ratify the Treaty, also on behalf of Member States, based on Articles 114 (functioning of the internal market) and 207 (common commercial policy) TFEU. 16.30 A few months later, based on the same grounds, the Commission submitted a proposal to the Council to ratify the Treaty (COM/2014/0638 final, of 21 October 2014). This time, a few Member States opposed it, arguing that competence was to be shared between Member States and the EU.24 23 24

See https://www.ip-watch.org/2014/04/30/four-more-wipo-members-sign-marrakesh-treaty-for-visually-impaired/. See the European Parliament’s resolution of 3 February 2016, noting ‘with profound indignation that seven EU Member States have formed a minority block which is impeding the process of ratifying the Treaty’; and ‘calling on the Council

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In order to overcome the deadlock, the Commission sought the opinion of the Court of Justice of 16.31 the European Union (CJEU) on the matter of the EU’s exclusive competence to sign the Treaty arguing in favour of the double ground of Articles 114 and 207 TFEU or, at least, on the latter.25 On 14 February 2017 (Opinion 3/15, Grand Chamber),26 the CJEU confirmed that the EU had exclusive competence to ratify the Marrakesh Treaty, also on behalf of its Member States. Despite the Commission not having specifically asked the Court to identify the legal grounds for the exclusive competence, the Court’s Opinion seemed to give preference to Article 114 TFEU (establishment and functioning of the internal market), over Article 207 TFEU (common commercial policy).27 The EU ratified the Marrakesh Treaty on 1 October 2018, also on behalf of its Member States.28

1. Human rights and copyright As explained in Recital 21 MTD, the rights of blind, visually impaired or otherwise print-disabled 16.32 persons are recognized in the Charter of Fundamental Rights of the European Union (the EUCHR) and the United Nations Convention on the Rights of Persons with Disabilities (the UNCRPD) of 2006, to which the EU is a party. The Directive respects these fundamental rights and observes the principles recognized in these instruments. Article 21 EUCHR prohibits ‘any discrimination based on any ground such as sex, race, colour, 16.33 ethnic or social origin, genetic features, language, religion or belief, political or any other opinion, membership of a national minority, property, birth, disability, age or sexual orientation’. Under Article 26 EUCHR ‘the Union recognises and respects the right of persons with disabilities to benefit from measures designed to ensure their independence, social and occupational integration and participation in the life of the community’. The UNCRPD guarantees persons with disabilities the right of access to information and education 16.34 (Art. 24) and the right to participate in cultural, economic and social life (Art. 30), on an equal basis with others. Specifically, Article 30.3 UNCRPD requires that countries ‘shall take all appropriate steps, in accordance with international law, to ensure that laws protecting intellectual property rights do not constitute an unreasonable or discriminatory barrier to access by persons with disabilities to cultural materials’. Laws protecting intellectual property should not pose a discriminatory or unreasonable barrier 16.35 limiting access to cultural materials by persons with disabilities. The Directive is a first step to ensure that beneficiary persons have access to books and other printed material in accessible formats across the internal market (Recital 18 MTD), so as to ensure their independence, social and occupational integration and participation in the life of the community (Recital 17 MTD).

25

26 27

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and the Member States to accelerate the ratification process, without making ratification conditional upon revision of the EU legal framework or the decision of the Court of Justice of the European Union’; See European Parliament resolution of 3 February 2016 on the ratification of the Marrakesh Treaty, based on petitions received, notably Petition 924/2011 (2016/2542(RSP)) https://www.europarl.europa.eu/doceo/document/TA-8-2016-0037_EN.html?redirect. The Commission argued, as an alternative, that Art. 207 TFEU alone might suffice to the extent that the Marrakesh Treaty goal was international trade (the international ‘exchange’ of accessible format copies among contracting parties) and that its effects on national laws (the mandatory exception) was merely a means of achieving that goal. Opinion of the CJEU (Grand Chamber) of 14 February 2017 (C-3/15) ECLI:EU:C:2017:114. As far as Art. 207 TFEU was concerned, the Court explained that the mere exchange of accessible format copies with third (non-EU) countries (which indeed may have effects on international trade) is not enough per se to conclude that it was a matter falling within the common commercial policy. The Marrakesh Treaty obligation relating to the cross-border exchange of accessible format copies ‘cannot be equated with international trade for commercial purposes’; rather, it is just a means of achieving the non-commercial objective of the Marrakesh Treaty. See https://www.wipo.int/pressroom/en/articles/2018/article_0008.html.

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Chapter 16 THE MARRAKESH TREATY

16.36 These fundamental rights and principles should guide the interpretation and application of the Marrakesh Treaty Directive (Recital 21 MTD).

2. Relationship between the Directive and the Regulation 16.37 The MTD establishes two obligations for Member States: a mandatory VIP exception to allow the making, use and supply of AFC, and the ‘cross-border’ exchange of AFC among EU Member States. The MTR governs the ‘cross-border’ exchange of AFC between EU Members and third countries that have ratified the Marrakesh Treaty. 16.38 The Directive has been transposed into national law by EU Member States (deadline was 11 October 2018). The Regulation directly applies in all EU countries since 12 October 2018. 16.39 As reminded by Recital 22, both instruments must be read together: ‘Regulation (EU) 2017/1563 … should be read in conjunction with this Directive.’

3. Subsidiarity and proportionality principles 16.40 The MTD pursues two goals: to increase the availability of books and other printed material in accessible formats, and to improve their circulation in the internal market (Recital 3 MTD). 16.41 The MTD is adopted in accordance with the principle of subsidiarity as set out in Article 5 TFEU: The objective of this Directive, namely to improve access in the Union to works and other subject matter protected by copyright and related rights for persons who are blind, visually impaired or otherwise print-disabled, cannot be sufficiently achieved by the Member States but can rather, by reason of its scale and effects, be better achieved at Union level. (Recital 23 MTD)

16.42 In accordance with the principle of proportionality, also set out in Article 5 TFEU, ‘this Directive does not go beyond what is necessary in order to achieve that objective’ (Recital 23 MTD). This means that the measures adopted in the Directive have a minimum of harmonization and that Member States may adopt further measures for the benefit of VIPs, as long as they comply with the three-step test and do not endanger the proper functioning of the internal market.

NOTES 1. References Accessible Books Consortium (ABC): www.accessiblebooksconsortium.org. Convention on the Rights of Persons with Disabilities (2006): https://www.un.org/development/desa/disabilities/ convention-on-the-rights-of-persons-with-disabilities.html. EIFL (2015), The Marrakesh Treaty: an EIFL Guide for Libraries https://www.eifl.net/resources/marrakesh-treatyeifl-guide-libraries-english. European Blind Union (EFU), Guidelines for Making Information Accessible to All: http://www.euroblind.org/ publications-and-resources/making-information-accessible-all. EU Charter of Fundamental Rights (2012): https://ec.europa.eu/info/aid-development-cooperation-fundamentalrights/your-rights-eu/eu-charter-fundamental-rights_en./para. Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired, or Otherwise Print Disabled (2013): https://www.wipo.int/treaties/en/ip/marrakesh/. Opinion of the Court of Justice of the European Union (Grand Chamber) of 14 February 2017 (C-3/15) ECLI:EU:C:2017:114. World Blind Union (WBU) The WBU Guide to the Marrakesh Treaty: http://www.worldblindunion.org/English/ourwork/our-priorities/Pages/WBU-Guide-to-the-Marrakesh-Treaty.aspx.

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ARTICLE 2: DEFINITIONS

2. Bibliography Banasiuk, J., ‘Implementation of the Marrakesh Treaty – An input into discussion from the perspective of the European Union’ (2018) 65 Journal of the Copyright Society of the U.S.A. 335–44. Blomqvist, J., Primer on International Copyright and Related Rights, Edward Elgar (2014). Ficsor, M., Commentary to the Marrakesh Treaty on Accessible Format Copies for the Visually Impaired [MS Word], (2018) www.copyrightseesaw.net. Helfer, L., et al., The World Blind Union Guide to the Marrakesh Treaty, OUP (2017). Hilty, R., K. Köklü, A. Kur et al., ‘Position Paper of the Max Planck Institute for Innovation and Competition’ (2015) 46 IIC - International Review of Intellectual Property and Competition Law 707–16. https://doi.org/10.1007/s40319015-0381-5. Ramírez-Montes, C., The Marrakesh Treaty: A Study, commissioned by the European Parliament Policy Department for Citizens’ Rights and Constitutional Affairs (2016) https://www.europarl.europa.eu/RegData/etudes/STUD/ 2016/571387/IPOL_STU(2016)571387_EN.pdf. Reinbothe, J. and S. von Lewinski, The WIPO Treaties on Copyright – A Commentary on the WCT, the WPPT, and the BTAP, OUP, 2nd ed. (2015). Trimble, M., ‘The Marrakesh Puzzle’ (204) 45 IIC - International Review of Intellectual Property and Competition Law 768–95. Vezzoso, S., ‘The Marrakesh Spirit – A Ghost in Three Steps?’ (2014) 45 IIC - International Review of Intellectual Property and Competition Law 796–820. von Lewinski, S., ‘Chapter 18: The Marrakesh Treaty’ in J. Reinbothe and S. von Lewinski, The WIPO Treaties on Copyright – A Commentary on the WCT, the WPPT, and the BTAP, OUP, 2nd ed. (2015).

ARTICLE 2: DEFINITIONS For the purposes of this Directive the following definitions apply: (1)

(2)

(3)

(4)

‘work or other subject matter’ means a work in the form of a book, journal, newspaper, magazine or other kind of writing, notation, including sheet music, and related illustrations, in any media, including in audio form such as audiobooks and in digital format, which is protected by copyright or related rights and which is published or otherwise lawfully made publicly available; ‘beneficiary person’ means, regardless of any other disabilities, a person who: (a) is blind; (b) has a visual impairment which cannot be improved so as to give the person visual function substantially equivalent to that of a person who has no such impairment, and who is, as a result, unable to read printed works to substantially the same degree as a person without such an impairment; (c) has a perceptual or reading disability and is, as a result, unable to read printed works to substantially the same degree as a person without such disability; or (d) is otherwise unable, due to a physical disability, to hold or manipulate a book or to focus or move their eyes to the extent that would be normally acceptable for reading. ‘accessible format copy’ means a copy of a work or other subject matter in an alternative manner or form that gives a beneficiary person access to the work or other subject matter, including allowing such person to have access as feasibly and comfortably as a person without any of the impairments or disabilities referred to in point 2; ‘authorised entity’ means an entity that is authorised or recognised by a Member State to provide education, instructional training, adaptive reading or information access to beneficiary persons on a non-profit basis. It also includes a public institution or non-profit organisation that provides the same services to beneficiary persons as one of its primary activities, institutional obligations or as part of its public-interest missions.

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I. COMMENTARY 1. Works or other subject matter 16.43 The MTD implements the Marrakesh Treaty obligations (VIP mandatory exception and crossborder exchange of AFC) applicable to ‘works and other subject matter,’ that is, to copyright and related rights, respectively. For purposes of EU harmonization, it makes perfect sense. The VIP mandatory exception and cross-border exchange obligation apply to all works and subject matter, as well as to all the rights (and rightholders) that have been harmonized under the EU acquis: copyright and related rights. 16.44 The Marrakesh Treaty formally refers to ‘Works’ and deals with E&L to ‘copyright’. However, its text and spirit make it applicable also to the realm of performances and related rights, in general. The Agreed Statement concerning Article 10(2) MT expressly refers to it: It is understood that when a work qualifies as a work under Article 2(a), including such works in audio form, the limitations and exceptions provided for by this Treaty apply mutatis mutandis to related rights as necessary to make the accessible format copy, to distribute it and to make it available to beneficiary persons.

16.45 In terms of the kind of works and subject matter covered, the Marrakesh Treaty and the MTD coincide. The definition of ‘work and other subject matter’ in Article 2(1) MTD covers works ‘in the form of a book, journal, newspaper, magazine or other kind of writing, notation, including sheet music, and related illustrations, in any media, including in audio form such as audiobooks and in digital format’. Notice the two specific examples: ‘including sheet music’ and ‘including in audio form such as audiobooks and in digital format’ and the fact that the making of an audiobook includes not only the exploitation of a ‘work’ (created by an author) but also a ‘performance’ (made by an actor) and a ‘phonogram’ (made by a producer). Recital 7 MTD adds further explanations to visualize the kind of works and subject matter covered: ‘books, including e-books, journals, newspapers, magazines and other kinds of writing, notation, including sheet music, and other printed material, including in audio form’. 16.46 The EU definition is not much wider than the scope of works covered by the Marrakesh Treaty.29 It basically covers ‘published’ works ‘in the form of text’, leaving out audiovisual works/recordings or musical works/recordings (other than music scores).30 Despite some scholarly interpretation that the Marrakesh Treaty does not cover ‘born-accessible’ copies,31 the MTD explicitly covers works ‘in any media, including in audio form such as audiobooks and in digital format ’, leaving little doubt that AFC may also be obtained from lawful digital copies of works. 16.47 Some scholars seem to argue that the Marrakesh Treaty obligations only apply to foreign works, not to domestic works.32 This might be in accordance, indeed, with the traditional view adopted by international copyright conventions, under the principle of national treatment and the exclusion of protection in the country of origin. However, this conclusion not only fails to take into account the very special nature of the Marrakesh Treaty but would completely dismiss the very goal of the Treaty: to increase availability of AFC in all countries, also of domestic works. In any case, the EU Directive clearly applies to print/text works lawfully made available in EU countries, and regardless 29

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Art.2(a) MT: ‘“works” means literary and artistic works within the meaning of Article 2(1) of the Berne Convention for the Protection of Literary and Artistic Works, in the form of text, notation and/or related illustrations, whether published or otherwise made publicly available in any media’. The Agreed Statement concerning Art. 2(a) MT explains: ‘For the purposes of this Treaty, it is understood that this definition includes such works in audio form, such as audiobooks.’ See von Lewinski #18.0.35, Ficsor 13, and Blomqvist #35 89. See von Lewinski #18.0.14 and 38. See ibid., #18.0.31–33.

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ARTICLE 2: DEFINITIONS

of their ‘country of origin’ (in BC terms). AFC copies of these works may be made under the VIP mandatory exception (or obtained otherwise), and these AFC can be subsequently ‘imported and exported’ with other EU countries, as well as with other Marrakesh Treaty signatory countries (see MTR). In order to make AFC under the VIP exception, the work must have been ‘published or otherwise 16.48 lawfully made publicly available’. Recital 7 MTD further clarifies the ‘otherwise’: ‘whether digital or analogue, online or offline’. The VIP exception will not permit the making of AFC of works that had not been lawfully disclosed; since the requirement of lawfulness refers to the work rather than the copy, the nature of the copy used to obtain the AFC seems to be irrelevant and the VIP exception might permit the making of AFC from infringing copies of lawfully available works. Accordingly, the scope of works and subject matter affected by the MTD is wider and more specific 16.49 than the scope of works affected by the Marrakesh Treaty. This may be especially important when dealing with the cross-border exchange of AFC between EU countries and third countries under the MTR (see infra). In any case, this is a typical issue that results from the territoriality of national laws: the definition of which ‘works’ (and, if so, which ‘protected subject matter’) will be ultimately a matter for national law, also within the EU. For instance, if a Spanish AE makes an AFC (in the form of an audiobook) under the Spanish VIP 16.50 exception (MTD), can this AFC be supplied to an AE established in any other Marrakesh Treaty contracting party whose VIP exception does not formally cover audiobooks and related rights? As long as we are talking about audiobooks, the Agreed Statement of Article 2(a) MT offers a straight answer: works in audio form, such as audiobooks, are included. But the solution would be less apparent if dealing with other related rights (or, for instance, a sui generis right on databases). A restrictive interpretation of the term ‘works’ covered by the Marrakesh Treaty would be contrary to its very spirit and goal. Beneficiary persons (VIPs) and AEs in all contracting parties should be allowed to benefit from AFC lawfully made in any other contracting party, despite the fact that this AFC could not have been lawfully made (by the ‘importing’ AE) under the law of the country ‘of import’. Any other interpretation would directly ‘cripple’ the Marrakesh Treaty and substantially diminish its effectiveness to expand and improve the circulation of AFC of protected works (and subject matter). Based on the principle of subsidiarity, and the fact that the Directive only establishes a minimum of 16.51 harmonization, EU Member States might choose to include other kinds of works and recordings under the VIP exception – as long as this does not hinder the proper functioning of the internal market. Whether or not AFC of these works may be also subject to the cross-border exchange within the EU and outside the EU remains a matter for debate (see below Art. 4 MTD and Arts 3–4 MTR).

2. Beneficiary person 16.52

The definition of ‘beneficiary person’ in Article 2(2) MTD includes: persons who are blind; persons who have a visual impairment, which cannot be improved so as to give them visual function substantially equivalent to that of a person who has no such impairment; + persons who have a perceptual or reading disability, including dyslexia or any other learning disability preventing them from reading printed works to substantially the same degree as persons without such disability; + and persons who are unable, due to a physical disability, to hold or manipulate a book or to focus or move the eyes to the extent that would be normally acceptable for reading, insofar as, + +

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as a result of such impairments or disabilities, those persons are unable to read printed works to substantially the same degree as persons without such impairments or disabilities. 16.53 This definition follows almost verbatim the one in Article 3 MT. Despite the Treaty definition containing only three categories,33 the scope of ‘beneficiary persons’ is the same under the Directive and the Treaty. 16.54 As in the Marrakesh Treaty, any uses a beneficiary person is allowed to make may also be made by another natural person ‘on behalf of a beneficiary person or who assists the beneficiary person’ (Recital 9 MTD).

3. Accessible format copy 16.55 Similarly, the definitions of ‘accessible format copy ’ and ‘authorised entity ’ in Article 2(3) and (4) MTD, respectively, follow verbatim Article 2(b) and (c) MT. Any minor changes are easily explained as adaptations to EU legal language. 16.56 An AFC is a copy (of a work or protected subject matter) in any ‘alternative format’ that makes it accessible to beneficiary persons ‘to substantially the same degree as to persons without such impairment or disability’ (Recital 7 MTD). Article 2.3 MTD refers to ‘as feasibly and comfortably as a person without any of the impairments or disabilities’. AFC may be in digital or analogue or paper formats (for instance, Braille copies may be in paper as well as in digital format). AFC is an open concept and may accommodate any new technological formats that become available, always complying with the conditions and obligations set in the MTD. 16.57 According to Recital 7 MTD, ‘accessible formats include, for example, Braille, large print, adapted e-books, audio books and radio broadcasts … including in audio form, whether digital or analogue, online or offline ’. The technical standard DAISY (Digital Accessible Information System) is one of the formats widely used nowadays for the making of digital audio books that offer interactive functions (marking up the text, adding comments, synchronized reading), and is compatible and interoperable with multiple devices and software formats (XML, Word, EPUB3).34

4. Authorized entities 16.58 The concept of AE is a wide and flexible one, intended to accommodate any public or private organization that primarily (as one of its primary activities) serves VIPs: ‘public or private organisations, in particular libraries, educational establishments and other non-profit organisations, that serve persons with a print disability as one of their primary activities, institutional obligations or as part of their public interest missions’ (Recital 9 MTD). 16.59 Two kinds of AEs are specifically envisioned in Article 2.4 MTD: +

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Entities that have been ‘authorised or recognised ’ by EU national governments ‘to provide education, instructional training, adaptive reading or information access to beneficiary

This is so because ‘visual impairment’ and ‘perceptual or reading disability’ are separated under paras (b) and (c) of Art. 2(2) MTD, respectively. For a detailed analysis of DAISY functionalities, see von Lewinski #18.0.12–14.

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persons on a non-profit basis’. This may also include entities that receive financial support from the government.35 + Public institutions or non-profit organizations ‘that provide the same services to beneficiary persons as one of its primary activities, institutional obligations or as part of its public-interest missions’. This last wording ‘or as part of its public interest missions’ was not in the Treaty, but it can be easily justified for the same reason (adaptation to EU acquis language). Thus, the scope of AEs in the Directive (Art. 2.4 MTD) is similar to the Treaty (Art .2.c MT). 16.60 However, there is a relevant difference between the two instruments: while the Marrakesh Treaty seems to heavily rely on the AE having been ‘authorized or recognized by the government’, Recital (13) MTD diminishes its importance explaining that although Member States may apply authorization and recognition requirements, they ‘should not have the effect of preventing entities that are covered by the definition of authorised entity under this Directive from undertaking the uses allowed under this Directive’. In other words, no authorization process (or recognition requirements) set in any EU country should reduce or restrict the scope of AEs benefitting from the VIP obligations; the harmonized definition of AE will prevail over any specific national regulation that might restrict its scope.

NOTES 1. Bibliography Blomqvist, J., Primer on International Copyright and Related Rights, Edward Elgar (2014). Ficsor, M., Commentary to the Marrakesh Treaty on accessible format copies for the visually impaired [MS Word], (2018) www.copyrightseesaw.net. Reinbothe, J. and S. von Lewinski, The WIPO Treaties on Copyright – A Commentary on the WCT, the WPPT, and the BTAP, OUP, 2nd ed. (2015).

ARTICLE 3: PERMITTED USES 1.

Member States shall provide for an exception to the effect that no authorisation of the rightholder of any copyright or related right in a work or other subject matter is required pursuant to Articles 5 and 7 of Directive 96/9/EC, Articles 2, 3 and 4 of Directive 2001/29/ EC, Article 1(1), Article 8(2) and (3) and Article 9 of Directive 2006/115/EC and Article 4 of Directive 2009/24/EC for any act necessary for: (a) a beneficiary person, or a person acting on their behalf, to make an accessible format copy of a work or other subject matter to which the beneficiary person has lawful access for the exclusive use of the beneficiary person; and (b) an authorised entity to make an accessible format copy of a work or other subject matter to which it has lawful access, or to communicate, make available, distribute or lend an accessible format copy to a beneficiary person or another authorised entity on a non-profit basis for the purpose of exclusive use by a beneficiary person.

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According to the Agreed Statement concerning Art. 2(c) MT, ‘entities recognized by the government may include entities receiving financial support from the government to provide education, instructional training, adaptive reading or information access to beneficiary persons on a non-profit basis’.

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Chapter 16 THE MARRAKESH TREATY

2. 3. 4. 5. 6.

Member States shall ensure that each accessible format copy respects the integrity of the work or other subject matter, with due consideration given to the changes required to make the work or other subject matter accessible in the alternative format. The exception provided for in paragraph 1 shall only be applied in certain special cases which do not conflict with a normal exploitation of the work or other subject matter and do not unreasonably prejudice the legitimate interests of the rightholder. The first, third and fifth subparagraphs of Article 6(4) of Directive 2001/29/EC shall apply to the exception provided for in paragraph 1 of this Article. Member States shall ensure that the exception provided for in paragraph 1 cannot be overridden by contract. Member States may provide that uses permitted under this Directive, if undertaken by authorised entities established in their territory, be subject to compensation schemes within the limits provided for in this Directive.

I. COMMENTARY 1. A mandatory exception 16.61 The MTD imposes on EU Member States a mandatory exception. With it, the MTD seeks to implement the Marrakesh Treaty obligations in all EU countries, ‘in a harmonized manner, with a view to ensuring that the corresponding obligations are applied consistently throughout the internal market’ (Recital 6 MTD). 16.62 Mandatory E&L were not very common in EU acquis. In fact, this was only the ‘third’ general mandatory exception existing in the EU acquis, in addition to the temporary copies exception in Article 5.1 ISD 2001/29/EC and the one introduced by the Orphan Works Directive 2012/28/ EU.36 The harmonization of E&L to copyright and related rights was traditionally done by means of exhaustive lists (numerus clausus), which were open (optional) for implementation by Member States; the lists of E&L in Article 5.2 and Article 5.3 ISD are the best examples. Over the years, a deeper approximation of E&L within the EU is being achieved by the CJEU, by qualifying E&L in EU acquis (despite being optional for Member States) as ‘autonomous concepts of EU law’ that require a uniform interpretation all throughout the EU; see, CJEU Painer (C-145/10), FAPL (C-403/08 and C-429/08), Deckmyn (C-201/13). More recently, mandatory E&L have become a more regular instrument to further advance the harmonization of national laws; see Directive (EU) 2019/790 on Copyright in the Digital Single Market, which provides for several mandatory E&L. 16.63 Article 3 MTD implements (almost verbatim) the obligations and provisions set out in several provisions of the Marrakesh Treaty (basically Art. 4 MT, but also Art. 2 and Art. 7 MT) and makes a few specific choices left open by the Marrakesh Treaty for contracting parties. Specific choices that will bind EU national legislators when implementing the Directive are: compensation not required (but allowed), no prior checking of commercial availability, and contractual terms cannot override permitted uses. Let us consider them all.

2. Scope of permitted uses 16.64 Three types of activities are permitted under the Marrakesh Treaty: to make AFC, to supply AFC to VIP persons, and to obtain and supply AFC from/to other AEs by any means (analogue or digital).

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Specific E&L (some of them, mandatory) applied to computer programs (Directive 2009/24/EC) and databases (Directive 96/9/EC).

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In copyright language, these activities involve at least the exclusive rights of reproduction, distribution, communication to the public and making available. In terms of the rights of exploitation permitted, the MTD (and the MTR) go a bit further than the 16.65 MT. The MT affects the rights of reproduction and distribution (which remain undefined),37 the right of making available online (defined by reference to the WCT) and remains silent about the right of communication to the public, only allowing contracting parties to extend the VIP exception to cover the public performance of the work (Art. 4.1(b) MT). Instead, the MTD covers all the exclusive rights that have been so far harmonized under EU acquis:38 reproduction (in any format: analogue or digital), distribution to the public (including rental and lending), communication to the public (including public performance,39 transmission by satellite and cable retransmission), the making available to the public (that is, interactive exploitation online),40 as well as – for whatever it may serve – the sui generis right on databases. This choice can be easily justified in order to maintain the coherence within the EU acquis. It would 16.66 not make sense to implement a mandatory new exception all across the EU, which does not cover all rights that have been harmonized by EU acquis. Nothing is mentioned in the EU instruments (Directive and Regulation) regarding the right of 16.67 transformation (i.e., translations). On the one hand, because this right has never been harmonized by EU acquis. On the other, because the Marrakesh Treaty does not include the right of transformation/adaptation in the list of permitted uses. Agreed Statement to Article 4.3 MT only refers to it thus: ‘this paragraph neither reduces nor extends the scope of applicability of limitations and exceptions permitted under the Berne Convention, as regards the right of translation, with respect to persons with visual impairments or with other print disabilities’. Certainly, including translations in the VIP exception would result in a ‘privileged access’ for VIP 16.68 persons (rather than equal access) and, accordingly, it would not be justified by the purpose of the Treaty.41 However, nothing prevents an AE from ‘importing and exporting’ AFC in languages other than its own (within or outside the EU). Spanish ONCE may not be allowed to translate a book into English under the VIP exception,42 but it may certainly ‘import’ an AFC in English made (or somehow obtained) by an AE in the UK or in Australia. In other words, nothing in the MTD (or the MTR) prevents the cross-border exchange of AFC in languages different from the languages which are predominant (or official) in the country where the ‘importing’ AE is established.

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Thus, the interpretation of exclusive rights, under each national law, may indirectly define, in different countries, different scopes of permitted uses under the Treaty. See Recital 6 MTD: ‘… in particular, the rights of reproduction, communication to the public, making available to the public, distribution and lending, as provided for in Directives 2001/29/EC, 2006/115/EC and 2009/24/EC, as well as the corresponding rights provided for in Directive 96/9/EC’. Public performance (i.e., reading a work in front of a live audience) requires a ‘public’ and VIPs usually would use this function for private purposes, without a public. Public performance may also include the making of audio description devices (sotto voce) explaining acts, movements, sounds and noises, scenes and/or costumes, as well as text-to-speech functions (such as in e-books). See Ficsor #143. See von Lewinski #18.0.50. See also Helfer #2.5.2.2. The CJEU seems to uphold a restrictive interpretation of the ‘making available online’, to only cover ‘interactive’ online transmissions (acts that allow for some ‘interaction’ by the user), leaving other acts of online exploitation under the broader concept of communication to the public. See CJEU, C-More Entertainment (C-279/13) ##25–27. See von Lewinski #18.0.58. Because Art. 31ter(2) Spanish Copyright Act only exempts the rights of reproduction, distribution and communication to the public (including making available).

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Chapter 16 THE MARRAKESH TREATY

3. Conditions 16.69 Under both the MTD and the MT, permitted uses may be made by VIPs, or by someone on his/her behalf, and by AEs. According to Recital 9 MTD: The permitted uses laid down in this Directive should include the making of accessible format copies by either beneficiary persons or authorised entities serving their needs … (it) should also include the making of accessible format copies, for the exclusive use of beneficiary persons, by a natural person who does so on behalf of a beneficiary person or who assists the beneficiary person making such copies.

16.70 AFC can only relate to works to which they have ‘lawful access ’. 16.71 AFC must be for the exclusive use of VIPs. This condition applies to AFC made by VIPs (or someone acting on their behalf) as well as to AFC made by AEs. Thus, for instance, when an AFC is streamed to or supplied for download by VIP ‘registered users’,43 AEs will need to make sure of this by applying DRMs (see below). 16.72 AFC made by AEs must be made and circulated ‘on a non-profit basis ’. This condition does not apply (for obvious reasons) to AFC made directly by VIPs. However, this would not excuse an eventual abuse of the VIP exception. A minor formal difference applies regarding beneficiary persons: Article 3.1(a) MTD requires that the AFC is made by the beneficiary person ‘for the exclusive use of the beneficiary person’, while Article 4.2(b) MT refers to ‘for the personal use of the beneficiary person’. This difference may not have a major impact on the scope of permitted uses, but it is worth having it in mind. 16.73 The moral right of integrity must be respected when making AFC (Art. 3.2 MTD)44 ‘with due consideration given to the changes required’ to make the AFC. This seems to allow some balancing between safeguarding the moral right of integrity, in its core, and permitting changes which are required to make the AFC. In most cases, the necessary changes to make an AFC will be merely formal and will only involve the right of reproduction; they will hardly affect the substance of the work. To the extent that they are necessary (for instance, to make an abbreviated AFC of a work) these changes should not infringe the moral right of integrity. According to Recital 8 MTD: The mandatory exception provided for in this Directive should limit the right of reproduction so as to allow for any act that is necessary in order to make changes to or convert or adapt a work or other subject matter in such a way as to produce an accessible format copy that makes it possible for beneficiary persons to access that work or other subject matter. This includes providing the necessary means to navigate information in an accessible format copy. It also includes changes that might be required in cases in which the format of a work or of other subject matter is already accessible to certain beneficiary persons while it might not be accessible to other beneficiary persons, due to different impairments or disabilities, or the different degree of such impairments or disabilities.

4. Three-step test 16.74 The Directive expressly requires permitted uses to comply with the three-step test (Art. 3.3 MTD). This is very much aligned with prior EU acquis (i.e., Art. 5.5 ISD) and perfectly in compliance with Article 11 MT which refers to the three-step tests (in its different treaty versions) and obliges contracting parties to abide by it.

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See von Lewinski #18.0.16. See also Art. 2(b) MT.

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ARTICLE 3: PERMITTED USES

Three specific choices are made by the EU legislator. The Marrakesh Treaty allows contracting 16.75 parties to make these choices. EU Member States will be bound by the choices made by the EU legislator in the MTD and will have ‘less freedom’ when implementing the Marrakesh Treaty, as compared to other contracting parties. Nevertheless, this does not diminish the relevance of national implementations of the MTD: national laws will govern the making of AFC and VIP uses in each national territory, the cross-border exchange of AFC within the EU internal markets, and – indirectly – will also apply to the cross-border exchange of AFC with other third countries (under the Regulation).

5. Compensation not required, but possible (only for national AEs) The Directive does not require compensation for the making, import or export of AFC. However, 16.76 Article 3(6) MTD allows Member States to require compensation. Compensation schemes are optional for Member States. Thus, it is foreseeable that not all EU countries will require compensation45 and that, where so required, the amount of compensation will be different in different countries. National differences in terms of compensation have never been seen as an obstacle to the proper functioning of the internal market.46 However, bearing in mind that the requirement of compensation ‘creates a risk of discrimination between print-disabled and non-print disabled individuals’,47 not only in that country but also within the EU market, Member States should apply caution when making that choice and only use it – in compliance with the three-step test – to avoid causing an unreasonable prejudice to the rightholders’ legitimate interests (Art. 5.5 ISD). If a Member State chooses to require compensation, it can only do so regarding AEs in that country; 16.77 no compensation can be required for exempted acts done (directly or indirectly) by beneficiary persons or by AEs established in other countries (including in EU Member States). Recital (14) In view of the specific nature of the exception provided for under this Directive, its specific scope and the need for legal certainty for its beneficiaries, … Member States should only be allowed to provide for compensation schemes regarding the permitted uses of works or other subject matter by authorised entities. In order to avoid burdens for beneficiary persons, prevent barriers to the cross-border dissemination of accessible format copies and excessive requirements on authorised entities, it is important that the possibility for Member States to provide for such compensation schemes be limited. Consequently, compensation schemes should not require payments by beneficiary persons … They [compensation schemes] should only apply to uses by authorised entities established in the territory of the Member State providing for such a scheme, and they should not require payments by authorised entities established in other Member States or third countries that are parties to the Marrakesh Treaty.

It is a compensation, not a remuneration. Although the terms remuneration and compensation are 16.78 often used interchangeably by national and international legislators, the name does matter in the EU acquis. Compensation is intended to ‘compensate … adequately’ the damage caused to the rightholder (i.e., in the case of a limitation of an exclusive right); however, remuneration is not restricted to compensate any damage caused. The express distinction between compensation and remuneration, has been explained in Recital (35) ISD: fair compensation to compensate them adequately for the use made of their protected works or other subject matter. When determining the form, detailed arrangements and possible level of such fair compensation,

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For instance, Greece, Art. 28A(9); Germany, Sec. 45b–45d; and Austria, Sec. 42d(8) require compensation. For instance, differences regarding the compensation for private copying which have been endorsed by the CJEU: see CJEU Padawan (C-468/08), Stitching de Thuiskopie (C-435/12), VG Wort (C-457/11), Copydan (C-463/12), Reprobel (C-572/13); also differences regarding remuneration for communication to the public in different countries: see CJEU Basset (C-402/85). See Helfer #2.5.6.

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Chapter 16 THE MARRAKESH TREATY account should be taken of the particular circumstances of each case. When evaluating these circumstances, a valuable criterion would be the possible harm to the rightholders resulting from the act in question.

16.79 Beyond this conceptual distinction, Recital (14) MTD specifically refers to the criteria to be taken into account to establish the amount of compensation and mandates that no payment should be required when harm caused to a rightholder is minimal. … They [compensation schemes] should only apply to uses by authorised entities established in the territory of the Member State providing for such a scheme, and they should not require payments by authorised entities established in other Member States or third countries that are parties to the Marrakesh Treaty. Member States should ensure that there are not more burdensome requirements for the cross-border exchange of accessible format copies under such compensation schemes than for non-cross border situations, including with regard to the form and possible level of compensation. When determining the level of compensation, due account should be taken of the non-profit nature of the activities of authorised entities, of the public interest objectives pursued by this Directive, of the interests of beneficiaries of the exception, of the possible harm to rightholders and of the need to ensure cross-border dissemination of accessible format copies. Account should also be taken of the particular circumstances of each case, resulting from the making of a particular accessible format copy. Where the harm to a rightholder is minimal, no obligation for payment of compensation should arise.

Compensation is the only option left for Member States to decide.

6. Prohibition on imposing additional requirements (no prior checking of commercial availability) 16.80 According to Article 4.4 MT, contracting parties may confine the VIP exception to a prior check on commercial availability of the work: ‘A Contracting Party may confine limitations or exceptions under this Article to works which, in the particular accessible format, cannot be obtained commercially under reasonable terms for beneficiary persons in that market. ’48 If such a requirement is adopted, that State must notify WIPO. Making the requirement of non-commercial availability optional for contracting States was meant to encourage publishers to offer AFC themselves.49 16.81 For the sake of ‘legal certainty,’ the EU legislator decided not to require a prior checking of non-commercial availability of works in accessible formats before permitting the making and dissemination of AFC. As a result, EU Member States cannot require it, either. In that sense, see Recital (14) MTD: In view of the specific nature of the exception provided for under this Directive, its specific scope and the need for legal certainty for its beneficiaries, Member States should not be allowed to impose additional requirements for the application of the exception, such as the prior verification of the commercial availability of works in accessible formats, other than those laid down in this Directive.

16.82 The exclusion of the requirement of commercial availability seems to be a wise decision. Not only because of the several open questions that would make its assessment complex, but also because it would significantly restrict the effect of the VIP exception within the EU market. For instance, the Marrakesh Treaty referred to commercial availability ‘under reasonable terms … in that market’

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According to the Agreed Statement concerning Art. 4(4) MT: ‘It is understood that a commercial availability requirement does not prejudge whether or not a limitation or exception under this Article is consistent with the three-step test.’ See MT preamble: ‘Recognizing both the importance of rightholders’ role in making their works accessible to persons with visual impairments or with other print disabilities and the importance of appropriate limitations and exceptions to make works accessible to these persons, particularly when the market is unable to provide such access.’ See also Ficsor #14, p. 27.

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ARTICLE 3: PERMITTED USES

(Art. 4.4 MT). How would the ‘reasonableness’ be assessed? In terms of price? – What may be a reasonable price for the rightholder may not be so for a library or a beneficiary person – Or also in terms of the time and effort involved in locating and obtaining the commercial accessible copy? What ‘markets’ should be considered? Within the EU, does this mean checking in all 27 national markets or would commercial availability in one suffice? What about formats? In principle, copies commercially available should be in the specific format needed by the beneficiary person – otherwise, that format would not be ‘accessible’ for him. All these questions are avoided by prohibiting a prior check of non-commercial availability. EU Member States cannot impose any additional requirements. This prohibition is especially important 16.83 in terms of AFC made and disseminated within the EU (see infra Art. 4 MTD), but also of AFC exchanged with other third countries – especially by the effect of Articles 3 and 4 MTR (see below). As we explained above, the Regulation needs to be read in conjunction with the Directive, and the same scope of permitted uses (under Art. 3 and Recital 13 MTD) is fully applicable for purposes of the Regulation. Thus, the scope of permitted uses is the same when an EU country imports or exports AFC from/to another EU country (MTD), as well as from/to any other (non-EU) Marrakesh Treaty signatory country (MTR). It means that EU countries cannot impose this requirement (or any additional requirements) on any AFC exchanged (imported or exported) from other EU countries or from other non-EU Marrakesh Treaty signatories, regardless of what the law of these countries states. We will revisit this issue below.

7. Protection of TPM but no contractual override of E&L Article 3(4) and (5) MTD contains two very important provisions, which will, de facto, define the 16.84 scope of permitted uses. One of them is already formally envisioned in Article 7 MT; the other one is not. Article 7 MT obliges contracting countries to ‘take appropriate measures, as necessary’ to ensure 16.85 that the protection of technological measures (that is, the prohibition to circumvent them) does not prevent the uses permitted under the Treaty: Contracting Parties shall take appropriate measures, as necessary, to ensure that when they provide adequate legal protection and effective legal remedies against the circumvention of effective technological measures, this legal protection does not prevent beneficiary persons from enjoying the limitations and exceptions provided for in this Treaty.

In other words, Article 7 MT is establishing a factual obligation to secure that the protection of technological measures will ‘not prevent beneficiary persons from enjoying the limitations and exceptions’. Instead, Article 3(4) MTD simply integrates the new VIP mandatory exception within the general 16.86 scheme of Article 6(4) ISD to balance the protection of TPM and the enforcement of E&L. Article 6(4) ISD obliges Member States to secure the effectiveness of only a few ‘privileged’ E&L; for the rest of E&L, Member States are not obliged to take any action. And when works have been obtained through a license (on agreed contractual terms), TPMs will prevail over E&L. Most Member States have done a verbatim transposition of Article 6(4) ISD, including the list of E&L permitted under the MTD, and defer disputes regarding TPM and E&L to jurisdictional proceedings. 16.87

Article 3(4) MTD refers only to paragraphs 1, 3 and 5 of Article 6(4) ISD: Notwithstanding the legal protection provided for in paragraph 1, in the absence of voluntary measures taken by rightholders, including agreements between rightholders and other parties concerned, Member

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Chapter 16 THE MARRAKESH TREATY States shall take appropriate measures to ensure that rightholders make available to the beneficiary of an exception or limitation provided for in national law in accordance with Article 5(2)(a), (2)(c), (2)(d), (2)(e), (3)(a), (3)(b) or (3)(e) the means of benefiting from that exception or limitation, to the extent necessary to benefit from that exception or limitation and where that beneficiary has legal access to the protected work or subject-matter concerned. … The technological measures applied voluntarily by rightholders, including those applied in implementation of voluntary agreements, and technological measures applied in implementation of the measures taken by Member States, shall enjoy the legal protection provided for in paragraph 1. … When this Article is applied in the context of Directives 92/100/EEC and 96/9/EC, this paragraph shall apply mutatis mutandis.

16.88 Subjecting the new VIP exception to Article 6(4) ISD is good and bad news, at the same time. On the one hand, it means that the new VIP mandatory exception is included within the list of E&L that enjoy the ‘special protection’ against the use of TPMs. Member States are obliged to ensure that these E&L will be effective and that the use of TPMs will not prevent their enforcement. This makes sense, since the general exception in favour of people with a disability provided for in Article 5.3(b) ISD was already included in that list and, as we saw, the new VIP mandatory exception entails an amendment to that provision (see Art. 8 MTD). It makes perfect sense that both E&L are treated equally. 16.89 However, it also means that the new VIP mandatory exception will be subject to the same measures provided for by Member States to secure this obligation, when copyright owners fail to provide on a voluntary basis ‘the means of benefiting from that exception or limitation’. These measures basically consist of specific administrative proceedings, arbitration, mediation and other dispute resolution mechanisms, as well as direct access to the judiciary (litigation). Article 6(4) ISD falls short of its initial aim to effectively secure uses permitted under E&L. As it stands now, the same risk will likely restrict the making and availability of AFC within the EU (and with other countries – see MTR). 16.90 With the previous experience regarding Article 6(4) ISD, the MTD could have certainly done more to secure that beneficiary persons and AEs will be able to enjoy the making and circulation of AFC. 16.91 However, Article 3(5) MTD introduces what can be seen as a surprise, in terms of EU acquis, as well as a novelty, when compared to the Marrakesh Treaty: uses permitted under the new VIP mandatory exception cannot be overridden by contract. As explained by Recital (9) MTD: ‘Member States should ensure that any contractual provision which seeks to prevent or limit the application of the exception in any way is void of legal effect.’ 16.92 In general terms, the question whether E&L may be overridden by contract remains open in the EU acquis. In fact, the answer seems to be a positive one. Both the Computer Programs Directive (Art. 9.1.2) and the Database Directive (Art. 15) have already prohibited that E&L listed in them could be overridden by contract. However, paragraph 4 of Article 6(4) ISD formally stated that E&L – even the ‘specially protected’ ones – must yield to contractual terms (at least, for works made available to the public ‘on agreed contractual terms’). Article 3(5) MTD makes a specific choice to prohibit contractual terms overriding the E&L (and this is why para. 4 of Art. 6(4) ISD is expressly left out). 16.93 The Marrakesh Treaty did not formally require safeguarding of the permitted uses against contracts. However, by doing so, Article 3(5) MTD is perfectly aligned with the goal and spirit of the Marrakesh Treaty and, more specifically, with the factual obligation imposed on contracting

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countries to secure that the protection of technological measures will ‘not prevent beneficiary persons from enjoying the limitations and exceptions’ (Art. 7 MT). Having said that, there appears to be an inherent inconsistency between Article 3(4) and (5) MTD; 16.94 that is, between the balancing of E&L with the protection of TPM (under Art. 6(4) ISD) and the direct prohibition of contractual terms overriding the permitted uses. TPMs may be used to restrict VIP permitted uses (and, failing voluntary measures supplied by rightholders, beneficiaries may be forced to go to court to be able to enjoy the exception), but any contractual terms that restrict VIP permitted uses are deemed null and void. It is not the place here to fully examine the internal relationship between Article 3(4) and (5) MTD, and how to solve its inherent inconsistency, but a few comments may be in order. This inconsistency may be overcome by interpreting that the use of TPM amounts to a contractual 16.95 override prohibited under Art. 3(5) MTD, thus allowing the circumvention of any TPMs that prevent a VIP permitted use (and avoiding the complex process to secure the use through voluntary measures or, in their absence, though judicial action). If ‘any contractual provision which seeks to prevent or limit the application of the exception in any way is void of legal effect’ (Recital 9 MTD), the same should apply to any TPM preventing or restricting these permitted uses. Such an interpretation would respond to the obligation imposed in Article 7 MT, namely, that countries ‘take the appropriate measures’ to ensure that the legal protection of TPMs does not prevent beneficiary persons from enjoying the uses permitted by the Treaty.50 This interpretation might be the best way to comply with the obligation in Article 7 MT, while 16.96 avoiding the inefficiencies of Article 6(4) ISD (and its poor implementation by Member States). The EU legislator missed the opportunity to do the same regarding TPM, instead of simply referring to the vague and insufficient Article 6(4) ISD. In summary, interpreting Article 3(5) MTD so as to prohibit not only contractual measures but also 16.97 any TPMs that restrict or prevent the VIP permitted uses, would correctly comply with Article 7 MT and avoid the less than optimal solution offered by Article 3(4) MTD and Article 6(4) ISD.

NOTES 1. CJEU case law Basset (C-402/85), ECLI:EU:C:1987:197 C-More Entertainment (C-279/13), ECLI:EU:C:2015:199 Copydan (C-463/12), ECLI:EU:C:2015:144 Deckmyn (C-201/13), ECLI:EU:C:2014:2132 FAPL (C-403/08 and C-429/08), ECLI:EU:C:2011:631 Padawan (C-468/08), ECLI:EU:C:2010:620 Painer (C-145/10), ECLI:EU:C:2011:798 Reprobel (C-572/13), ECLI:EU:C:2015:750 Stitching de Thuiskopie (C-435/12), ECLI:EU:C:2014:254 VG Wort (C-457/11), ECLI:EU:C:2013:426

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Furthermore, the EU principle of ‘interpretation in conformity’ takes into account the international obligations of EU Member States: ‘EU norms must be interpreted, in so far as possible, in the light of the applicable rules of international law, and in particular those set forth in the Berne Convention’; See CJEU Painer (C-145/10).

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Chapter 16 THE MARRAKESH TREATY

2. Bibliography Ficsor, M., Commentary to the Marrakesh Treaty on accessible format copies for the visually impaired [MS Word], (2018) www.copyrightseesaw.net. Helfer, L., et al., The World Blind Union Guide to the Marrakesh Treaty, OUP (2017). Reinbothe, J. and S. von Lewinski, The WIPO Treaties on Copyright – A Commentary on the WCT, the WPPT, and the BTAP, OUP, 2nd ed. (2015).

ARTICLE 4: ACCESSIBLE FORMAT COPIES IN THE INTERNAL MARKET Member States shall ensure that an authorised entity established in their territory may carry out the acts referred to in point (b) of Article 3(1) for a beneficiary person or another authorised entity established in any Member State. Member States shall also ensure that a beneficiary person or an authorised entity established in their territory may obtain or may have access to an accessible format copy from an authorised entity established in any Member State.

I. COMMENTARY 16.98 The Directive obliges Member States to permit the cross-border exchange of AFC within the internal market. IT does not impose an obligation on AEs to make and disseminate AFC. As explained in Recital 11 MTD: In order to ensure their greater availability across the internal market … (and) reduce the demand for duplication of work in producing accessible format copies of one and the same work or other subject matter across the Union, thus generating savings and efficiency gains … AFC made by authorised entities in any Member State can be circulated and accessed by beneficiary persons and authorised entities throughout the Union.

1. Cross-border exchange of AFC within the internal market 16.99 Article 4 Directive obliges Member States to secure that any AEs established in their territory are allowed to make AFC for any VIPs as well as for other AEs established in any other EU country. AFC may also be obtained or accessed, by VIPs and AEs from other EU countries. The cross-border exchange envisioned under Article 4 MTD only affects EU Member States, not EEA countries (namely Norway, Iceland and Liechtenstein) or EFTA members (Switzerland). Crossborder exchange with these countries will be governed by the Regulation (see below). 16.100 AEs located in an EU country are entitled to ‘export’ AFC in any means (analogue or digital) to VIPs and AEs located in other EU countries. The EU legislator is here implementing the cross-border exchange (export/import) of AFC within the EU countries (namely provisions in Articles 5 and 6 MT): ensuring that any AFC lawfully made in an EU country can be ‘exported’ to another EU country and that any EU country can ‘import’ AFC from another EU country. In fact, since all EU countries are members of the BC and WCT, all of them will be able to import/export AFC amongst them and act as ‘hubs’ for these AFC to be ‘exported’ to third countries (see Regulation below). 16.101 A striking difference may be identified when comparing the text of Article 4 MTD and Article 5.1 MT. According to Article 5 MT: Cross-Border Exchange of Accessible Format Copies: 1. Contracting Parties shall provide that if an accessible format copy is made under a limitation or exception or pursuant to operation of law, that accessible

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ARTICLE 4: ACCESSIBLE FORMAT COPIES IN THE INTERNAL MARKET format copy may be distributed or made available by an authorized entity to a beneficiary person or an authorized entity in another Contracting Party. (emphasis added)

Strictly read, Article 5 MT may seem to restrict cross-border exchanges to AFC made under the 16.102 VIP exception or other E&L, and prohibit the ‘cross-border’ exchange of AFC commercially acquired or obtained under a license.51 Such a restrictive interpretation of Article 5 MT would unnecessarily restrict the availability of AFC on a worldwide basis and frustrate the aims of the Treaty. In any event, beyond the reference to E&L, the wording ‘pursuant to operation of law’ should allow for a more flexible reading, so as to include not only AFC made under any E&L in domestic law but also AFC of non-protected contents (non-works or in public domain).52 Neither the MTD, nor the MTR follow this wording. On the contrary, Article 4 MTD seems to 16.103 allow for a broader scope of AFC circulating within the EU market. By referring to Article 3.1(b) MTD, AFC that may be exchanged (exported) by AEs to other EU countries (and non-EU countries – see below Regulation) are not only those AFC made ‘of a work or other subject matter to which it has lawful access’ but, more generally, also AFC (not necessarily restricted to the above) that may be ‘communicated, made available, distributed or lend’ by the AE ‘to a beneficiary person of another AE on a non-profit basis for the purpose of exclusive use by a beneficiary person’. Thus, as long as the three-step test criteria are met (see below), an AE established in an EU country may export to another EU country (be it a VIP or an AE) an AFC of a work that had been commercially acquired in the exporting country but is not commercially available in the importing country. The cross-border exchange of AFC permitted within the EU countries under Article 4 MTD is not restricted to those obtained via an E&L but is applicable to any AFC lawfully accessed by the AE in that country – regardless of how it has been obtained. This result is not only aligned with the Marrakesh Treaty objective but also with the internal EU harmonization aimed by the mandatory VIP exception. As stated in Article 6 MT, the import of AFC is subject to the same rules provided for in national law to 16.104 permit the making of AFC. The import of AFC will be according to the same conditions set in each national law for the making of AFC. ‘Stated more plainly: the right to create carries with it the right to import.’53 This means that no prior verification of the commercial availability should be required within the EU before importing AFC from another EU Member State. It also means that if compensation is required in one country for making AFC, compensation should also apply to importing AFC from other countries. Foreseeing that the only margin for national differences allowed under the MTD is the requirement of 16.105 compensation for AFC made and disseminated by authorized entities, and that these differences may cause uncertainty when AFC are imported or exported from/to another EU country, Article 3(6) MTD establishes two very important rules: that the payment of any compensation – if so required by national law – will only be required from AEs established in that Member State: in other words, no payment will be required from AEs established in other EU or non-EU Marrakesh Treaty signatory countries that supply or obtain AFC to/from an AE established in an EU country that requires compensation; + and that the cross-border exchange of AFC will not be subject to more burdensome requirements than the internal EU exchange of AFC (among AEs established within the same country). +

51 52 53

See Ficsor pp. 14–15, 28–9. See von Lewinski #18.0.63. See Helfer #2.6.2.1. See ibid., #2.6.2.2.

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Chapter 16 THE MARRAKESH TREATY

16.106 According to Recital (14) MTD ‘Member States should ensure that there are not more burdensome requirements for the cross-border exchange of accessible format copies under such compensation schemes than for non-cross border situations, including with regard to the form and possible level of compensation.’ At a first glance, this statement (compensation might also be required in crossborder exchange scenarios) seems to contradict Article 3(6) MTD.54 However, on a closer look, this last sentence in Recital (14) MTD basically tries to avoid that AEs established in countries that choose to require compensation, are excessively burdened or charged for the AFC exchanged with AEs in other EU (and non-EU) countries. In other words, compensation required by a Member State can only apply to AEs established in its territory; these AEs might be required to pay compensation for any copies they ‘make’, as well as for copies ‘obtained’ from AEs in another EU country (or in a non-EU country) and copies ‘supplied’ to AEs in another EU country (or in a non-EU country). Recital (14) MTD intends to avoid that the payment of compensation – where required – for AFC exchanged with another Marrakesh Treaty Contracting State becomes an excessive burden for AEs in the EU territory, since this may indirectly restrain the chances (and budget) for cross-border exchange (import/export) of AFC. 16.107 Another sensitive issue when dealing with cross-border exchange of AFC involves direct ‘export’ of AFC to VIPs. According to the Agreed Statement concerning Article 5(2) MT: It is understood that, to distribute or make available accessible format copies directly to a beneficiary person in another Contracting Party, it may be appropriate for an authorized entity to apply further measures to confirm that the person it is serving is a beneficiary person and to follow its own practices as described in Article 2(c).

Nevertheless, the MTD does not make any distinction in that sense. Regardless of whether the VIP is in the same country or in a different EU country, the AE making or obtaining the AFC has an obligation, a ‘duty of care’, to act in good faith: the AE must have no knowledge (or reason to believe) that the AFC would be for someone other than the beneficiary (see Art. 5 below). Each AE must do so according to ‘its own practices’ – a reminder, once again, that the requirements to ‘export’ AFC directly to VIPs in another EU country should not be more burdensome than those applied to make AFC available to VIPs in the same country. The contrary would cripple the goal of the Marrakesh Treaty and the MTD.

NOTES 1. Bibliography Ficsor, M., Commentary to the Marrakesh Treaty on accessible format copies for the visually impaired [MS Word], (2018) www.copyrightseesaw.net. Helfer, L., et al., The World Blind Union Guide to the Marrakesh Treaty, OUP (2017). Reinbothe, J. and S. von Lewinski, The WIPO Treaties on Copyright – A commentary on the WCT, the WPPT, and the BTAP, OUP, 2nd ed. (2015).

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Art. 3(6) MTD and this part of Recital (14) MTD were introduced by the Parliament; see Position of the European Parliament adopted at first reading on 6 July 2017 (EP-PE_TC1-COD(2016)0278).

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ARTICLE 5: OBLIGATIONS OF AUTHORISED ENTITIES

ARTICLE 5: OBLIGATIONS OF AUTHORISED ENTITIES 1.

2.

Member States shall provide that an authorised entity established in their territory carrying out the acts referred to in Article 4 establishes and follows its own practices to ensure that it: (a) distributes, communicates and makes available accessible format copies only to beneficiary persons or other authorised entities; (b) takes appropriate steps to discourage the unauthorised reproduction, distribution, communication to the public or making available to the public of accessible format copies; (c) demonstrates due care in, and maintains records of, its handling of works or other subject matter and of accessible format copies thereof; and (d) publishes and updates, on its website if appropriate, or through other online or offline channels, information on how it complies with the obligations laid down in points (a) to (c). Member States shall ensure that the practices referred to in the first subparagraph are established and followed in full respect of the rules applicable to the processing of personal data of beneficiary persons referred to in Article 7. Member States shall ensure that an authorised entity established in their territory carrying out the acts referred to in Article 4 provides the following information in an accessible way, on request, to beneficiary persons, other authorised entities or rightholders: (a) the list of works or other subject matter for which it has accessible format copies and the available formats; and (b) the name and contact details of the authorised entities with which it has engaged in the exchange of accessible format copies pursuant to Article 4.

I. COMMENTARY Article 5 MTD imposes on AEs two sets of obligations, in order to prevent infringements and to 16.108 improve the availability of AFC.55 These obligations may be traced back to the Marrakesh Treaty, either under the requirements specifically set out in Article 2(c) MT and Article 5(2) in fine MT, or under the general cooperation measures set out in Article 9 MT aimed at facilitating cross-border exchange of AFC. The obligations listed in Article 5 MTD are mandatory for Member States (‘shall provide’) and they 16.109 should be correctly implemented into national laws. Each authorized entity may ‘establish and follow its own practices’ to comply with these obligations, and 16.110 always observing the norms on the protection of personal data (see Art. 7 MTD). 16.111

According to Article 5.1 MTD, AEs in a Member State must: (a) (b) (c) (d)

55

ensure that AFC are only used by VIPs or other AEs; take steps to discourage infringement; keep records of AFC made and demonstrate due care; publish and update information on how it complies with previous obligations (through online or offline channels).

See Recital 12 MTD: ‘In order to improve the availability of accessible format copies and to prevent the unauthorised dissemination of works or other subject matter, Authorised Entities which engage in the distribution, communication to the public or making available to the public of accessible format copies should comply with certain obligations.’

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Chapter 16 THE MARRAKESH TREATY

16.112 The first two obligations result from a regular ‘duty of care’ that applies to anybody benefitting from statutory E&L: the AE must ensure that AFCs will be only used by VIPs and take steps to avoid infringing uses. Each AE must do so according to ‘its own practices’. In principle, measures to confirm that the person served is a VIP may be the same regardless of the country where this person is located. However, since different circumstances may require different means of confirmation, an AE may establish different measures to confirm that the person requesting the AFC is a VIP. 16.113 Similarly, as part of its professional ‘duty of care’, the AE must take steps to discourage infringement (as also required by Art. 2(c)(iii) MT). This may include the implementation of DRM and TPMs to prevent further downstream uses (see below). 16.114 The AE must keep (internal) records of AFC made, obtained and supplied. 16.115 Information on measures taken to secure that AFC are only used by VIPs and on the recordkeeping system must be publicly available, preferably through the AE’s website. This obligation to provide information, on very wide and flexible terms (online or offline), was not included in Article 2(c) MT but it is clearly justified as a measure to facilitate the cross-border exchange of AFC, at least within the EU market. 16.116 On another level, Article 5.2 MTD requires that – upon request – AEs established in EU countries provide information on the list of works and subject matter available and the formats available, as well as the contact details of AEs with which it has exchanged AFC. This information may be requested by beneficiary persons (VIPs), by other AEs, as well as by rightholders. Once again, the provision of information regarding AFC and formats available is aligned with the ‘voluntary sharing of information’ encouraged by Article 9 MT, in order to foster the cross-border exchange of AFC. The obligation to provide information upon request not only refers to the AFC made, obtained and supplied by the AE, but also to/from other AEs in the same country or in other EU countries (and even non-EU countries, ex Art. 5.2(b) MTR). Notice that – as expected, to protect privacy – no obligation exists to provide information (contact details) of individual beneficiaries that have enjoyed AFC (see Art. 7 MTD). 16.117 In summary, AEs in EU countries do not appear to be subject to more stringent or burdensome obligations than AEs in other countries, under the Marrakesh Treaty. Only the obligation to provide information ‘upon request’ (Art. 5.2 MTD) may become de facto an extra burden imposed on AEs established in the EU. Despite this obligation being specifically an EU rule, it is not unthinkable that other countries – when implementing the Marrakesh Treaty – may also require AEs in their territories to provide the same information. 16.118 A periodically updated list of (AEs) authorized or recognized by EU countries may be found at: https://ec.europa.eu/digital-single-market/en/authorised-entities-context-directive-eu-20171564.

ARTICLE 6: TRANSPARENCY AND EXCHANGE OF INFORMATION 1.

2.

Member States shall encourage authorised entities established in their territory carrying out the acts referred to in Article 4 of this Directive and Articles 3 and 4 of Regulation (EU) 2017/1563 to communicate to them, on a voluntary basis, their names and contact details. Member States shall provide the information they have received pursuant to paragraph 1 to the Commission. The Commission shall make such information publicly available online on a central information access point and keep it up to date.

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ARTICLE 7: PROTECTION OF PERSONAL DATA

I. COMMENTARY On another level, Member States must ‘encourage’ AEs in their territories to provide them – on a 16.119 voluntary basis – with information regarding the names and contact details of other AEs they exchange AFC with, so that the Member State can transfer this information to the Commission to be made available online (and updated) ‘on a central information access point’. Recital 11 MTD justifies the voluntary sharing of this information ‘in order to foster such cross-border exchange and to facilitate authorised entities’ mutual identification and cooperation’. This should not imply ‘an obligation for Member States to check the completeness and accuracy of such information or its compliance with their national law transposing this Directive’ (Recital 11 MTD). Such information should be made available online by the Commission on a central information 16.120 access point at Union level, so as to: assist authorised entities, as well as beneficiary persons and rightholders in contacting authorised entities to receive further information … The aforementioned central information access point should be complementary to the information access point to be established by the International Bureau of the World Intellectual Property Organisation (WIPO), … aiming to facilitate the identification of, and cooperation among, authorised entities at international level. (Recital 11 MTD)

So far, no such access point has been made available. The infrastructure of the operational Global 16.121 Book Service run by the ABC Consortium (at WIPO) might facilitate the gathering and provision of such information always on a voluntary basis, since many AEs might not be obliged by their national laws to do so. The GBS may already be (at least, a partial) source of that information, and is already available online; see http://www.accessiblebooksconsortium.org/globalbooks/en/.

ARTICLE 7: PROTECTION OF PERSONAL DATA The processing of personal data carried out within the framework of this Directive shall be carried out in compliance with Directives 95/46/EC and 2002/58/EC.

I. COMMENTARY The processing of any personal data carried out within the framework of the Directive shall be done 16.122 in compliance with the EU acquis on the protection of personal data and the respect for private and family life. According to Recital 15 MTD: It is essential that any processing of personal data under this Directive respect fundamental rights, including the right to respect for private and family life and the right to protection of personal data under Articles 7 and 8 of the Charter, and it is imperative that any such processing also be in compliance with Directives 95/46/EC and 2002/58/EC of the European Parliament and of the Council, which govern the processing of personal data, as may be carried out by authorised entities within the framework of this Directive and under the supervision of the Member States’ competent authorities, in particular the public independent authorities designated by the Member States.

Currently, the governing norm in the EU on the protection of personal data is the ‘General Data 16.123 Protection Regulation’ (GDPR), applicable since May 2018, which repealed Directive 95/46/EC.

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Chapter 16 THE MARRAKESH TREATY

NOTES 1. Related instruments General Data Protection Regulation (GDPR): Regulation (EU) 2016/679, of 27 April 2016, on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation). Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector (Directive on privacy and electronic communications) (OJ L 201, 31.7.2002, p. 37). Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data (OJ L 281, 23.11.1995, p. 31). That Directive will be repealed and replaced, with effect from 25 May 2018, by Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ L 119, 4.5.2016, p. 1). REPEALED by the GDPR.

ARTICLE 8: AMENDMENT TO DIRECTIVE 2001/29/EC In Article 5(3) of Directive 2001/29/EC, point (b) is replaced by the following: ‘(b)

uses, for the benefit of people with a disability, which are directly related to the disability and of a non-commercial nature, to the extent required by the specific disability, without prejudice to the obligations of Member States under Directive (EU) 2017/1564 of the European Parliament and of the Council;’

I. COMMENTARY 16.124 When the Marrakesh Treaty Directive and Regulation were adopted, the harmonization of E&L in the EU acquis was already scattered through several Directives: 96/9/EC (Databases), 2001/29/EC (InfoSoc), 2006/115/EC (Rental and lending rights) and 2009/24/EC (Computer programs) and 2012/28/EU (Orphan works). The EU acquis already provided for an E&L in favour of people with disabilities, in general. Specifically, Article 5.3(b) ISD allows Member States to introduce E&L to the rights of reproduction, distribution and communication to the public (including the making available online) to allow: ‘(b) uses, for the benefit of people with a disability, which are directly related to the disability and of a non-commercial nature, to the extent required by the specific disability; …’ 16.125 Since the Marrakesh Treaty covers uses that may be clearly exempted under Article 5.3(b) ISD, and Member States cannot adopt any other limitations than those listed in Article 5 ISD, the implementation of the Marrakesh Treaty by the EU inevitably required amending this provision. Article 8 MTD does so, by simply adding a final caveat to Article 5.3(b) ISD: ‘without prejudice to the obligations of Member States under Directive (EU) 2017/1564 of the European Parliament and of the Council ’. Thus, under Article 5.3(b) ISD, EU Member States may still provide for different E&L allowing uses in favour of ‘people with a disability’, as well as uses in favour of VIPs beyond the scope exempted under the VIP exception.

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ARTICLE 8: AMENDMENT TO DIRECTIVE 2001/29/EC

Most EU national laws provide for some exception in favour of people with disabilities.56 Most of 16.126 them do so in a very broad sense, often following the exact terms of Art. 5.3(b) ISD. Because of the broad language used, these exceptions tend to benefit the individual persons 16.127 suffering from a disability, as well as organizations (public or private), libraries and the like, as long as copies are not made for commercial purposes. Only a few Member States subject the exception to the prior checking of non-commercial availability (i.e., Germany and the UK) or to compensation (i.e., Germany, Netherlands, Austria, Sweden). A few countries, instead, only exempted specific formats for blind people.57 Neither the Marrakesh Treaty nor the MTD affect the freedom of EU countries to provide for 16.128 other E&L for the benefit of people with other disabilities and to permit further uses – always within the limits set out in Article 5.3 ISD and in compliance with the three-step test. According to Recital 20 MTD: Member States should be allowed to continue to provide for an exception or limitation for the benefit of persons with a disability in cases which are not covered by this Directive, in particular as regards works and other subject matter and disabilities other than those covered by this Directive, pursuant to point (b) of Article 5(3) of Directive 2001/29/EC. This Directive does not prevent Member States from providing for exceptions or limitations to rights that are not harmonised in the copyright framework of the Union.

VIP exceptions have been implemented verbatim in almost all EU national laws.58 Only a few 16.129 countries have chosen to require compensation for it.59 Most EU countries have maintained a separate E&L for the benefit of people with other disabilities (i.e., deaf people).60 The making of AFC for persons with other disabilities will not be subject to the same requirements and conditions set under the VIP mandatory exception. Yet, a country may choose to apply the same VIP rules to E&L for other disabilities. However, lacking an international treaty allowing it, the cross-border exchange of non-VIP AFC will not be possible, in theory, either within the EU, or outside.

NOTES 1. Related instruments Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases (OJ L 77, 27.3.1996, p. 20).

56

57 58

59 60

A ‘Study on the application of Directive 2001/29/EC on copyright and related rights in the information society’ of 2013 reported that 11 Member States had E&L for persons with disabilities; the Commission took into account this Study when proposing the VIP Directive [COM(2016) 596 final, of 14.09.2016]. For a deeper analysis of the implementation in European national laws of Art. 5.3(b) ISD, see Study on the Application of Directive 2001/29/EC on Copyright and Related Rights in the Information Society (2013), prepared by DeWolfe & Partners and the collaboration of CRIDS, pp. 415–45; available at https://op.europa.eu/s/n7ub. See also S. Reynolds (2015) EPRS Review of the EU Copyright Framework – European Implementation Assessment; available at https://www.europarl.europa.eu/RegData/etudes/STUD/ 2015/558762/EPRS_STU(2015)558762_EN.pdf. For instance, Ukraine only allowed the making of copies ‘in Braille font’ (Sec.21.6); Bulgaria also referred to Braille, but also permitted ‘other analogous methods if this is not done for profit’ (Sec. 24.10). References of all national transposition laws may be found on the EUR-LEX website at https://eur-lex.europa. eu/legal-content/EN/NIM/?uri=CELEX:32017L1564. Instead, France has chosen to do a non-verbatim implementation under one single exception for the benefit of ‘persons with one or more disabilities’ (‘personnes atteintes d’une ou de plusieurs déficiences des fonctions motrices, physiques, sensorielles, mentales, cognitives ou psychiques et empêchées, du fait de ces déficiences, d’accéder à l’œuvre dans la forme sous laquelle l’auteur la rend disponible au public’); see Art.122-5(7) and Art.122-5-1 and -2. For instance, Greece Art.28A(9), Germany Sec.45b-45d and Austria Sec.42d(8). For instance, Spain Art.31ter(1), Greece Art.28A(12), Italy Art.71-bis(1), Portugal Art.75(2)(i), Germany Sec.45a.

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Chapter 16 THE MARRAKESH TREATY Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society (OJ L 167, 22.6.2001, p. 10). Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (OJ L 376, 27.12.2006, p. 28). Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs (OJ L 111, 5.5.2009, p. 16). Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works (OJ L 299, 27.10.2012, p. 5).

ARTICLE 9: REPORT By 11 October 2020, the Commission shall present a report to the European Parliament, the Council and the European Economic and Social Committee on the availability, in accessible formats, of works and other subject matter other than those defined in point 1 of Article 2 for beneficiary persons, and of works and other subject matter for persons with disabilities other than those referred to in point 2 of Article 2, in the internal market. The report shall take into account developments concerning relevant technology and shall contain an assessment of the appropriateness of broadening the scope of this Directive in order to improve access to other types of works and other subject matter and to improve access for persons with disabilities other than those covered by this Directive.

I. COMMENTARY 16.130 ‘The Commission should assess the situation regarding the availability in accessible formats of works and other subject matter other than those covered by this Directive, as well as the availability of works and other subject matter in accessible formats for persons with other disabilities’ (Recital 19 MTD). 16.131 As we saw, the MTD (like the Marrakesh Treaty) are only meant to address the so-called ‘book famine’ but VIPs are exposed to a similar ‘famine’ regarding other works and subject matter, such as audiovisual works and recordings and musical works and recordings. And similar ‘famines’ are suffered by persons with disabilities other than visual and print disabilities, such as deaf persons. The same fundamental rights and public interest that justified the adoption of the Marrakesh Treaty would equally justify the adoption of similar E&L for their benefit. Two years after its entry into force, the Commission wants to assess the eventual need to broaden the scope of the VIP exception to other works and protected subject matter, as well as to other disabilities. 16.132 With this assessment, the Commission may also need to assess the international implications of such an eventual ‘broadening’: it is one thing to enlarge the scope of national E&L regarding people with disabilities, another to allow for the cross-border exchange of AFC within the EU, and a very different one to allow for it outside the EU – without the ‘coverage’ offered by the Marrakesh Treaty. 16.133 According to Article 10.2 MTD, Member States must help the Commission by providing the necessary information to prepare for this Report.

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ARTICLE 11: TRANSPOSITION

ARTICLE 10: REVIEW 1.

2. 3.

By 11 October 2023, the Commission shall carry out an evaluation of this Directive and present the main findings in a report to the European Parliament, the Council and the European Economic and Social Committee, accompanied, where appropriate, by proposals for amending this Directive. Such evaluation shall include an assessment of the impact of compensation schemes, provided for by Member States pursuant to Article 3(6), on the availability of accessible format copies for beneficiary persons and on their cross-border exchange. The Commission’s report shall take into account the views of relevant civil society actors and of non-governmental organisations, including organisations representing persons with disabilities and those representing older persons. Member States shall provide the Commission with the necessary information for the preparation of the report referred to in paragraph 1 of this Article and the preparation of the report referred to in Article 9. A Member State that has valid reasons to consider that the implementation of this Directive has had a significant negative impact on the commercial availability of works or other subject matter in accessible formats for beneficiary persons may bring the matter to the attention of the Commission providing all relevant evidence. The Commission shall take that evidence into account when drawing up the report referred to in paragraph 1.

I. COMMENTARY In 2023, five years after the Directive’s implementation deadline and three years after the 16.134 Commission’s report in 2020, the Commission will assess the impact of the MTD and, if necessary, will make any proposals to amend it. Member States must help the Commission by providing the necessary information to prepare this 16.135 assessment. Civil society actors and NGOs will be heard in preparing this assessment. Article 10 MTD draws attention to two specific issues to be evaluated: the impact of compensation 16.136 schemes set by EU Member States for the making of AFC and their cross-border exchange, and the risk that the implementation of the Directive may have a ‘significant negative impact on the commercial availability of works and other subject matter in accessible formats for beneficiary persons.’ Member States are invited to bring any relevant evidence in that regard. This clause intends to assess and safeguard, as needed, the interests of the publishing industry, 16.137 especially after setting aside the prior checking of non-commercial availability as a requirement and prohibiting any other conditions for the making and cross-border exchange of AFC. E&L must comply with the three-step test and if evidence suggests that the VIP mandatory exception conflicts with the normal exploitation of certain works or is causing an unreasonable prejudice to the legitimate interests of rightholders, the conditions for the VIP mandatory exceptions should be accordingly recalibrated. Similarly, if compensation schemes set by Member States prove to be too astringent and deter the availability of AFC for VIPs (also across-borders), they should also be reassessed.

ARTICLE 11: TRANSPOSITION 1.

Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 11 October 2018. They shall immediately inform the Commission thereof.

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2.

When Member States adopt those measures, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. The methods of making such reference shall be laid down by Member States. Member States shall communicate to the Commission the text of the main measures of national law which they adopt in the field covered by this Directive.

I. COMMENTARY 16.138 The VIP mandatory exception must have been implemented by each Member State and enacted into national law by 11 October 2018. 16.139 Following the Joint Political Declaration of 28 September 2011 of Member States and the Commission on explanatory documents (OJ C 369, 17.12.2011, p. 14), Directives ‘shall be binding, as to the result to be achieved, upon each Member State to which it is addressed, but shall leave to the national authorities the choice of form and methods.’ For this reason, Member States must notify their transposition measures to the Commission and attach ‘one or more documents explaining the relationship between the components of a directive and the corresponding parts of national transposition instruments’ (Recital 24 MTD). 16.140 Member States are free to choose the form and methods to implement the MTD into national law. However, two principles need to be taken into account: the principle of ‘direct effect’ and the principle of ‘interpretation in conformity’. 16.141 To the extent that many of the provisions in the Directive are mandatory, Member States have little room to manoeuvre. Member States are obliged to correctly implement the provisions of a Directive, and within the time set in the Directive. A national law that fails to comply with it shall be deemed incompatible with EU acquis and the provisions of the Directive would be directly applied, instead.61 This is known as the principle of direct effect of EU law. In order for the provisions in a Directive to have a ‘direct effect,’ they must be ‘unconditional and sufficiently clear and precise ’.62 The same ‘direct effect’ applies when an EU country fails to implement the Directive by the established deadline. Most of the provisions in the Marrakesh Treaty Directive and Regulation are ‘unconditional and sufficiently clear and precise’ so as to have a direct effect in EU Member States where a national law fails to correctly implement them. 16.142 As far as the rest of provisions, which do not have a direct effect (i.e., Arts 5.2 and 6.1 MTD), the principle of interpretation in conformity should guide its implementation and interpretation in national law. According to this principle, also developed by the CJEU,63 Member States (including national courts) are obliged to ‘interpret their national law in the light of the wording and the purpose of the directive in order to achieve the result referred to (in the Directive)’. This obligation

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This principle is especially relevant regarding Directives (Regulations always have a ‘direct effect’, since they are directly applicable in all EU Member States, ex Art. 288 TFEU). A Directive has direct effect when its provisions are unconditional and sufficiently clear and precise and when the EU country has not transposed the Directive by the deadline; see CJEU of 4 Dec. 1974 (Van Duyn). This principle has been developed by the CJEU over time: EU law not only creates obligations for EU countries but also rights for individuals, and these rights may be ‘directly invoked’ before any national courts regardless of what national law may state. EU countries are still obliged to implement Directives, and to implement them correctly, but the national failure to do so will not be used against an individual. The principle of interpretation in conformity holds Member States obliged to ‘interpret their national law in the light of the wording and the purpose of the directive in order to achieve the result referred to (in the Directive),’ [see CJEU, 29 Jan. 2008, Promusicae (C-275/06)] as well as ‘in the light of the applicable rules of international law, and in particular those set forth in the Berne Convention’ [see CJEU, 7 Dec. 2005, SGAE (C 306/05) ##35,40,41 and CJEU, 4 Oct. 2011, Football Association Premier League and Others (C-403/08 and C-429/08) #189].

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(to interpret national law in conformity with EU law) affects all national laws, including any pre-existing norms, which did not directly result from a transposition of a Directive. In summary, all the mandatory provisions in the Directive must be correctly implemented by 16.143 Member States into their national laws by 11 October 2018. As of that date, any national law that provides differently (or fails to correctly implement it) will be set aside in favour of the provisions in the Directive. For the non-mandatory provisions, Member States still need to implement and interpret them in a manner that is compatible with the wording and purpose of the Directive.

NOTES 1. CJEU case law FAPL (C-403/08 and C-429/08), ECLI:EU:C:2011:631 Promusicae (C-275/06), ECLI:EU:C:2008:54 SGAE (C-306/05), ECLI:EU:C:2006:764 Van Duyn (C-41/74), ECLI:EU:C:1974:133

ARTICLE 12: ENTRY INTO FORCE This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

ARTICLE 13: ADDRESSEES This Directive is addressed to the Member States.

REGULATION (EU) 2017/1563 of 13 September 2017 on the cross-border exchange between the Union and third countries of accessible format copies of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled

I. COMMENTARY The Marrakesh Treaty Regulation (MTR) governs the cross-border exchange of AFC for VIPs 16.144 between EU countries and non-EU countries that have signed the Marrakesh Treaty. Both EU instruments, the Directive and the Regulation, must be read together (‘in conjunction’), as instructed by Recital (22) MTD. The Regulation and the Directive share some provisions. The definitions (Art. 2 MTR/Art. 2 16.145 MTD) and the obligations of AEs (Art. 5 MTR/Art. 5 MTD) are the same. So is the provision on the protection of personal data (Art. 6 MTR/Art. 7 MTD) and the application date from 12 October 2018 (Art. 8 MTR/Arts 11–12 MTD). The review process (Art. 7 MTR) is also substantially the same as the one set for the Directive (Art. 10 MTD). For all these provisions, we refer to the comments previously made regarding the Directive.

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16.146 Here, comments will only be made to Article 1 and jointly to Articles 3 and 4 of the Marrakesh Treaty Regulation (MTR).

ARTICLE 1: SUBJECT MATTER AND SCOPE This Regulation lays down uniform rules on the cross-border exchange of accessible format copies of certain works and other subject matter between the Union and third countries that are parties to the Marrakesh Treaty without the authorisation of the rightholder, for the benefit of persons who are blind, visually impaired or otherwise print-disabled, within the field harmonised by Directives 2001/29/EC and (EU) 2017/1564, in order to prevent jeopardising the harmonisation of exclusive rights and exceptions in the internal market.

I. COMMENTARY 16.147 The MTD implements the Marrakesh Treaty by introducing a new mandatory exception (that must be transposed into national laws of Member States) allowing the making and dissemination of accessible-format copies for persons with a print-disability (VIPs), and the exchange of AFC among EU Member States. The Regulation (MTR) governs the exchange of AFC beyond the internal market: that is, between the EU countries and any third countries, which are parties to the Marrakesh Treaty. 16.148 Accordingly, once the national laws have been harmonized (by means of the VIP mandatory exception and the rest of the provisions set out in the MTD), the MTR establishes the conditions for the use of AFCs beyond the internal market: to be exchanged (imported and exported) with other Marrakesh Treaty signatory countries. This is explained by Recital (5) MTR: Directive (EU) 2017/1564 … aims to implement the obligations that the Union has to meet under the Marrakesh Treaty in a harmonised manner in order to improve the availability of accessible format copies for beneficiary persons in all of the Member States of the Union and the circulation of such copies within the internal market, and requires Member States to introduce a mandatory exception to certain rights that are harmonised by Union law. This Regulation aims to implement the obligations under the Marrakesh Treaty with respect to the export and import arrangements for accessible format copies for non-commercial purposes for the benefit of beneficiary persons between the Union and third countries that are parties to the Marrakesh Treaty, and to lay down the conditions for such export and import in a uniform manner within the field harmonised by Directives 2001/29/EC and (EU) 2017/1564 in order to ensure that those measures are applied consistently throughout the internal market and do not jeopardise the harmonisation of exclusive rights and exceptions contained within those Directives.

16.149 Since the MTR applies directly in all Member States, without need for implementation, the cross-border exchange of AFC between EU Member States and other Marrakesh Treaty signatory countries, will be regulated by the ‘uniform rules’ set out in the Regulation.

ARTICLE 2: DEFINITIONS For the purposes of this Regulation the following definitions apply: (1)

‘work or other subject matter’ means a work in the form of a book, journal, newspaper, magazine or other kind of writing, notation, including sheet music, and related illustrations, in any media, including in audio form such as audiobooks and in digital format,

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(2)

(3)

(4)

which is protected by copyright or related rights and which is published or otherwise lawfully made publicly available; ‘beneficiary person’ means, regardless of any other disabilities, a person who: (a) is blind; (b) has a visual impairment which cannot be improved so as to give the person visual function substantially equivalent to that of a person who has no such impairment, and who is, as a result, unable to read printed works to substantially the same degree as a person without such an impairment; (c) has a perceptual or reading disability and is, as a result, unable to read printed works to substantially the same degree as a person without such disability; or (d) is otherwise unable, due to a physical disability, to hold or manipulate a book or to focus or move their eyes to the extent that would be normally acceptable for reading; ‘accessible format copy’ means a copy of a work or other subject matter in an alternative manner or form that gives a beneficiary person access to the work or other subject matter, including allowing such person to have access as feasibly and comfortably as a person without any of the impairments or disabilities referred to in point 2; ‘authorised entity established in a Member State’ means an entity that is authorised or recognised by a Member State to provide education, instructional training, adaptive reading or information access to beneficiary persons on a non-profit basis. It also includes a public institution or non-profit organisation that provides the same services to beneficiary persons as one of its primary activities, institutional obligations or as part of its public-interest missions.

See above Art. 2 Directive (EU) 2017/1564.

ARTICLE 3: EXPORT OF ACCESSIBLE FORMAT COPIES TO THIRD COUNTRIES An authorised entity established in a Member State may distribute, communicate or make available to beneficiary persons or to an authorised entity established in a third country that is a party to the Marrakesh Treaty an accessible format copy of a work or other subject matter made in accordance with the national legislation adopted pursuant to Directive (EU) 2017/1564.

ARTICLE 4: IMPORT OF ACCESSIBLE FORMAT COPIES FROM THIRD COUNTRIES A beneficiary person or an authorised entity established in a Member State may import or otherwise obtain or access and thereafter use, in accordance with the national legislation adopted pursuant to Directive (EU) 2017/1564, an accessible format copy of a work or other subject matter that has been distributed, communicated or made available to beneficiary persons or to authorised entities, by an authorised entity in a third country that is a party to the Marrakesh Treaty.

I. COMMENTARY The cross-border exchange (‘export’ and ‘import’) of AFC between EU countries and non-EU 16.150 countries that have ratified the Marrakesh Treaty is regulated in Articles 3 and 4 MTR, respectively. The cross-border exchange of AFC with EEA countries (namely Norway, Iceland and Liechtenstein) and EFTA members (Switzerland) will be governed by the Regulation.

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16.151 AEs established in EU countries may ‘export’ AFC from AEs established in other (non-EU) countries ‘that are parties to the Marrakesh Treaty’. 16.152 VIP persons residing in an EU country and AEs established in EU countries may ‘import’ AFC from AEs established in other (non-EU) countries ‘that are parties to the Marrakesh Treaty’.

1. Same conditions under national law 16.153 The cross-border exchange of AFC is subject to the same rules envisioned in the national law to allow the making of AFC. This ‘equivalence’ is already implied in Article 6 Marrakesh Treaty,64 and confirmed by its Agreed Statement.65 ‘Stated more plainly: the right to create carries with it the right to import.’66 However, Articles 3 and 4 Regulation make this equivalence explicit in both directions: the ‘export’ as well as the ‘import’ of AFC to/from third countries will be done ‘in accordance with the national legislation adopted pursuant to Directive (EU) 2017/1564’. 16.154 As a result, EU national laws implementing the MTD will regulate the making, obtaining and supplying of AFC at three levels: within the territories of the respective EU countries, within the internal market (cross-border exchange of AFC among EU countries) and with non-EU countries that are signatories to the Marrakesh Treaty (cross-border exchange of AFC with other Marrakesh Treaty signatory countries). 16.155 The same conditions and restrictions that apply for the making of AFC in a specific EU country, will also apply to the exchange (import/export) of AFC with other EU and non-EU countries. It must be ‘an AFC of a work or other subject matter to which it has lawful access’ (regardless of whether the AFC has been obtained under the VIP mandatory exception or has been otherwise lawfully obtained – i.e., commercially acquired)67 and it must be done ‘on a non-profit basis for the purpose of exclusive use by a beneficiary person’ (see above Arts 3 and 4 MTD). EU countries cannot impose different conditions for the exchange of AFC (imported or exported) with other non-EU countries. 16.156 Justified by the need for legal certainty, Article 3 MTD prohibits the prior checking of noncommercial availability as a requirement for the making of AFC and that EU countries impose any other conditions for the making of AFC, other than the requirement of compensation. Accordingly, the EU country cannot subject the exporting of AFC to a non-EU country to a prior checking of the non-commercial availability of AFC of the work in that country. If at all, it will be for the country of destination (the importing country) to decide whether before importing the AFC it should be confirmed that AFC are not commercially available ‘under reasonable terms … in that market’ (Art. 4.4 Marrakesh Treaty). 16.157 As regards compensation, cross-border exchange (import and export) of AFC with non-EU countries will be subject to the same rules and restrictions set for the making and exchange of AFC

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Art. 6 provides: Importation of Accessible Format Copies: To the extent that the national law of a Contracting Party would permit a beneficiary person, someone acting on his or her behalf, or an authorized entity, to make an accessible format copy of a work, the national law of that Contracting Party shall also permit them to import an accessible format copy for the benefit of beneficiary persons, without the authorization of the rightholder.

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Agreed statement concerning Art. 6 Marrakesh Treaty: ‘It is understood that the Contracting Parties have the same flexibilities set out in Article 4 when implementing their obligations under Article 6.’ See Helfer, #2.6.2.2. See Commentary to Art.4 MTD.

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within EU countries: compensation can only apply to AEs (not beneficiary persons) and only to AEs established in the territory of the Member State requiring it (not to AEs established in other countries). See Articles 3 and 4 MTD (and comments above), as well as Recital 14 MTD: In view of the specific nature of the exception provided for under this Directive, its specific scope and the need for legal certainty for its beneficiaries, … Member States should only be allowed to provide for compensation schemes regarding the permitted uses of works or other subject matter by authorised entities. In order to avoid burdens for beneficiary persons, prevent barriers to the cross-border dissemination of accessible format copies and excessive requirements on authorised entities, it is important that the possibility for Member States to provide for such compensation schemes be limited. Consequently, compensation schemes should not require payments by beneficiary persons … They [compensation schemes] should only apply to uses by authorised entities established in the territory of the Member State providing for such a scheme, and they should not require payments by authorised entities established in other Member States or third countries that are parties to the Marrakesh Treaty. (emphasis added)

As a result, compensation for the cross-border exchange of AFC with non-EU countries will only 16.158 apply if (and to the same extent that) an EU national law requires it for the making and supply of AFC within the domestic and EU markets, and according to the same amounts applicable for the making and cross-border exchange within the EU market. Equally, compensation for the cross-border exchange of AFC with non-EU countries can only be 16.159 requested from AEs established in the country requiring it; VIP persons from non-EU countries (like VIP persons in EU countries) cannot be requested to pay any compensation in order to obtain AFC from EU countries. No payment will be required from AEs established in non-EU countries. The answers are less clear when EU countries import AFC from non-EU countries. To what extent 16.160 may the requirements set by the foreign country impact on the import of AFC towards the EU? Let us remember that Article 6 MT subjected the obtaining and importing of AFC to the same conditions, but not the exporting of AFC. For instance, let us assume that a country, which is party to the Marrakesh Treaty, establishes a requirement of non-commercial availability as a condition for the making of AFC, and for ‘exporting’ AFC to other countries. This is the case of Canada.68 Despite the fact that EU national laws would not require it (in fact, the MTD prohibits it), an AE in Canada will only be allowed to export ‘its’ AFC to an EU country after checking that it cannot be obtained commercially ‘under reasonable terms’ within the ‘destination’ market. If this is an EU country, what will be the market examined: the national market (of the ‘importing’ country) or the whole EU internal market? Given the structure of the Directive and Regulation, and the fact that it is ultimately national laws that apply, it would appear that it is only the ‘domestic’ market, where the AE importing the AFC is established, that should be considered, not the whole EU ‘internal market.’ And this is so, despite once the AFC is in the catalogue of an EU-established AE, this AFC may circulate within other EU countries (within the whole EU market) without any further checking of commercial availability, according to Articles 3 and 4 MTD. It may be argued that such a unilateral declaration imposing the checking of non-commercial 16.161 availability in the importing foreign country, as a requirement for exporting AFC, amounts to an extraterritorial application of national law to scenarios that occur in foreign territories which, under the principle of territoriality (and the conflict of law rules), should not be subject to it. Yet, the Marrakesh Treaty offers no answer to the question of which should be the applicable law and the 68

On 28 November 2017, Canada deposited a declaration with WIPO: in accordance with paragraph 4 of Article 4 of the Treaty, the specific exceptions in Canada’s national copyright law for the making and providing of accessible format copies for the benefit of persons with print disabilities are confined to works which, in the particular accessible format, cannot be obtained commercially under reasonable terms within the Canadian market or within the destination market, as applicable. The said declaration will enter into force, with respect to Canada, on 28 February 2018. See https://www.wipo.int/treaties/en/notifications/marrakesh/treaty_marrakesh_35.html.

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scope of its application, especially regarding exporting AFC. In fact, Article 5.5 MT states: ‘Nothing in this Treaty shall be used to address the issue of exhaustion of rights.’ Of course, it might be argued that Article 5.5 MT was intended to precisely avoid a unilateral extraterritorial effect of national laws beyond their corresponding jurisdictions. On the other, according to Article 1 MT, nothing in it shall prejudice any rights that a contracting party may have under other Treaties. A ‘Solomonic’ solution might be to subject acts of export happening in the country of exportation to the law of that country and acts of import happening in the country of importation to the law of that country.69 As a result, in the scenario presented above, since the making and export of the AFC takes place in Canada, and the requirement to check the non-commercial availability in the country of import is set as a condition ‘prior’ to the making and export of that AFC, the principle of lex loci protectionis (Art. 5.2 BC) would support its validity. However, such a reading, upholding a unilateral imposition of restrictive national requirements for the export of AFC to other Marrakesh Treaty countries, beyond the safeguards already deployed by Article 5.4 MT (see below), does not benefit the wider availability of AFC and contradicts the most fundamental Marrakesh Treaty goals. Having said that, a thorough examination of this issue should require a deeper analysis than is possible at this time.

2. Restrictions on the use of AFC in ‘Berne-gap’ countries 16.162 The cross-border exchange of AFC between EU countries and other countries ‘that are parties to the Marrakesh Treaty’ is uniformly regulated by the Regulation. Yet, not all countries that have ratified the Marrakesh Treaty have also ratified the Berne Convention and the WCT, and are bound by an international obligation to abide by the three-step test. Based on this, the Marrakesh Treaty established specific rules to restrict what can be done with AFC in ‘Berne-gap’ countries. Neither the Directive nor the Regulation refers to this restriction because it does not affect the use of AFC within the EU countries (all of them have signed the BC, the WCT and abide by the three-step test) and it will only affect specific non-EU countries. However, since AFC ‘exported’ from EU countries may be to ‘Berne-gap’ countries, it is relevant to refer to them here. 16.163 According to Article 5 MT, AFC may be exported (distributed or made available) to another Marrakesh Treaty country, without the rightholders’ consent. The ‘cross-border’ exchange of AFC among Marrakesh Treaty signatory countries applies as a minimum obligation, at all times. However, what can be done with these AFC will depend on whether the importing country is a member of the BC, the WCT or has implemented the three-step test. Article 5.4 MT establishes some restrictions on the use of AFC. Specifically: If the importing country is not a member of the BC, the importing AE must ensure that AFC will be used only by beneficiary persons in its territory (Art. 5.4(a) MT). In other words, a non-BC country that ratifies the Marrakesh Treaty cannot further export these files: it is an ‘import only’ country. + However, according to Article 5.4(b) Marrakesh Treaty, a country that is a member of the WCT is entitled to make and import AFC files, as well as to export these imported files. The same will apply if, despite not being a member of the WCT, the country has implemented the three-step test (this may be the case for many WTO countries which are bound by the TRIPs Agreement). +

16.164 In other words, to fully participate in the cross-border exchange with non-EU Marrakesh Treaty countries, this country must be either a WCT member or have enacted the three-step test into its national law. Otherwise, an AE established in this third (non-EU) country may receive AFCs from

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See von Lewinski #18.0.77–78.

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other Marrakesh Treaty countries,70 such as EU countries, but they will be restricted to ‘domestic’ use only (these AFC cannot be ‘exported’ to other countries). The Marrakesh Treaty does not oblige contracting parties to sign the WCT, but the restriction in Article 5.4(a) MT is supposed to be an ‘incentive for Contracting Parties that want to participate fully in cross-border exchange to adhere to the WCT or otherwise to provide for the … related application of the three-step test’.71

3. Cross-border exchange with non-signatory countries At first glance, obtaining an AFC from a country that has not ratified the MT would seem to 16.165 require the prior permission of the copyright owner, to the extent that the MT (and its cross-border exchange provision) does not apply. However, the Marrakesh Treaty does not (at least, formally) preclude the possibility of importing AFC from non-Marrakesh Treaty countries. Certainly, Article 6 MT72 ‘does not require that the imported copy originate in a contracting party’,73 and a national law that allows for the ‘import’ of AFC regardless of where they have been obtained may be perfectly compatible with the BC and the principle of territoriality (Art.5.2 BC), according to which protection in each country is decided exclusively by its national law. In fact, the import of AFC from non-Marrakesh Treaty countries would be consistent with the spirit of the Marrakesh Treaty and significantly expand availability of AFC, even though it might also weaken a main incentive for signing it. Irrespective, the Regulation seems to exclude this possibility by formally referring, at all times, only to Marrakesh Treaty countries. According to the MT Regulation, if a country has ratified the Marrakesh Treaty, EU countries may 16.166 export AFC to VIP persons and to AEs in that country, without the copyright owners’ consent. However, exporting AFC to non-VIP countries that have not signed the Marrakesh Treaty, would require permission from the copyright owner. Similarly, EU countries cannot benefit from the possibility of importing AFC from AEs established in countries that have not signed the Marrakesh Treaty, unless they have permission from the copyright owner.

NOTES 1. Bibliography Helfer, L., et al, The World Blind Union Guide to the Marrakesh Treaty, OUP (2017). Reinbothe, J. and S. Von Lewinski, The WIPO Treaties on Copyright – A commentary on the WCT, the WPPT, and the BTAP, OUP, 2nd ed. (2015).

ARTICLE 5: OBLIGATIONS OF AUTHORISED ENTITIES 1.

An authorised entity established in a Member State carrying out the acts referred to in Articles 3 and 4 shall establish and follow its own practices to ensure that it: (a) distributes, communicates and makes available accessible format copies only to beneficiary persons or other authorised entities;

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Of course, AFC can be made and supplied internally (within that country), according to the E&L set in its national law. See von Lewinski #18.0.69. Article 6 reads “Importation of Accessible Format Copies: To the extent that the national law of a Contracting Party would permit a beneficiary person, someone acting on his or her behalf, or an authorized entity, to make an accessible format copy of a work, the national law of that Contracting Party shall also permit them to import an accessible format copy for the benefit of beneficiary persons, without the authorization of the rightholder.” See Helfer #2.6.2.2.

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Chapter 16 THE MARRAKESH TREATY

2.

(b) takes appropriate steps to discourage the unauthorised reproduction, distribution, communication to the public and making available to the public of accessible format copies; (c) demonstrates due care in, and maintains records of, its handling of works or other subject matter and of accessible format copies thereof; and (d) publishes and updates, on its website if appropriate, or through other online or offline channels, information on how it complies with the obligations laid down in points (a) to (c). An authorised entity established in a Member State shall establish and follow the practices referred to in the first subparagraph in full respect of the rules applicable to the processing of personal data of beneficiary persons referred to in Article 6. An authorised entity established in a Member State carrying out the acts referred to in Articles 3 and 4 shall provide the following information in an accessible way, on request, to beneficiary persons, other authorised entities or rightholders: (a) the list of works or other subject matter for which it has accessible format copies and the available formats; and (b) the name and contact details of the authorised entities with which it has engaged in the exchange of accessible format copies pursuant to Articles 3 and 4.

See above Art. 5 Directive (EU) 2017/1564.

ARTICLE 6: PROTECTION OF PERSONAL DATA The processing of personal data carried out within the framework of this Regulation shall be carried out in compliance with Directives 95/46/EC and 2002/58/EC. See above Art. 7 Directive (EU) 2017/1564.

ARTICLE 7: REVIEW By 11 October 2023, the Commission shall carry out an evaluation of this Regulation and present the main findings in a report to the European Parliament, the Council and the European Economic and Social Committee, accompanied, where appropriate, by proposals for amending this Regulation. Member States shall provide the Commission with the necessary information for the preparation of the evaluation report. See above Art. 10 Directive (EU) 2017/1564.

ARTICLE 8: ENTRY INTO FORCE AND APPLICATION This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union. It shall apply from 12 October 2018. This Regulation shall be binding in its entirety and directly applicable in all Member States. See above Arts 10–11 Directive (EU) 2017/1564.

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17 THE DIGITAL SINGLE MARKET DIRECTIVE Irini Stamatoudi and Paul Torremans DIRECTIVE (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC

[2019] OJ L 130/92 A. Transient or incidental copies forming an essential part of a technological process 17.76 B. Transmission in a network between third parties by an intermediary or a lawful use 17.79 C. No independent economic significance 17.81 D. Outcome 17.82 2. Scientific research 17.88 3. Normal use of a database 17.104 4. Extraction of ‘insubstantial parts’ from a database protected by the sui generis right 17.107

TITLE I: GENERAL PROVISIONS ARTICLE 1: SUBJECT MATTER AND SCOPE I.

COMMENTARY

17.01

ARTICLE 2: DEFINITIONS I.

COMMENTARY 1. Research organisations 2. Text and data mining A. United Kingdom B. Ireland C. Japan D. United States 3. ‘Cultural heritage institution’ 4. ‘Press publication’ 5. ‘Information society service’ 6. ‘Online content-sharing service provider’

17.04 17.05 17.08 17.12 17.15 17.18 17.22 17.23 17.25 17.27 17.30

TITLE II: MEASURES TO ADAPT EXCEPTIONS AND LIMITATIONS TO THE DIGITAL AND CROSS-BORDER ENVIRONMENT

COMMENTARY 1. Introduction 2. Definition 3. Relevant economic rights

17.113 17.113 17.128 17.132 17.134

ARTICLE 4: EXCEPTION OR LIMITATION FOR TEXT AND DATA MINING

ARTICLE 3: TEXT AND DATA MINING FOR THE PURPOSES OF SCIENTIFIC RESEARCH I.

V. TDM IN THE DSM DIRECTIVE 1. The basic rule 2. Storage of copies 3. Security and integrity of networks and databases 4. Best practices

17.34 17.34 17.37 17.39

II. INFORMATION SOCIETY DIRECTIVE

17.48

III. DATABASE DIRECTIVE 1. Copyright 2. Sui generis right A. Extraction B. Re-utilisation 3. Contractual restrictions

17.53 17.53 17.59 17.62 17.66 17.70

IV. EXCEPTIONS AND LIMITATIONS 1. Temporary acts of reproduction

17.72 17.74

I.

COMMENTARY 1. Basic characteristics of the right 2. Storage of copies 3. Three-step test and technological protection measures

17.135 17.135 17.147 17.149

ARTICLE 5: USE OF WORKS AND OTHER SUBJECT MATTER IN DIGITAL AND CROSSBORDER TEACHING ACTIVITIES I.

COMMENTARY

17.151

ARTICLE 6: PRESERVATION OF CULTURAL HERITAGE I.

COMMENTARY

17.160

ARTICLE 7: COMMON PROVISIONS

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Chapter 17 THE DIGITAL SINGLE MARKET DIRECTIVE I.

COMMENTARY

2. The notion of ‘publishers of press publications’ 3. The rights granted 4. Express exclusions 5. The independency of the right 6. Authors entitled to a share of the revenues 7. Duration 8. Existing schemes of remuneration for authors and publishers

17.165

TITLE III: MEASURES TO IMPROVE LICENSING PRACTICES AND ENSURE WIDER ACCESS TO CONTENT CHAPTER 1: OUT-OF-COMMERCE WORKS AND OTHER SUBJECT MATTER ARTICLE 8: USE OF OUT-OF-COMMERCE WORKS AND OTHER SUBJECT MATTER BY CULTURAL HERITAGE INSTITUTIONS I.

COMMENTARY 1. Aim 2. Background 3. The notion of ‘out-of-commerce’ works 4. The two solutions for the online use of OOCWs 5. Licensing of OOCWs by representative CMOs 6. Online use of OOCWs by reason of an exception 7. Opt-out and publicity measures 8. Stakeholder dialogue

17.167 17.167 17.168 17.172

ARTICLE 16: CLAIMS TO FAIR COMPENSATION

17.183

ARTICLE 17: USE OF PROTECTED CONTENT BY ONLINE CONTENT-SHARING SERVICE PROVIDERS

17.185 17.191 17.194 17.199

I.

COMMENTARY

COMMENTARY

I.

17.203

COMMENTARY

17.205

ARTICLE 11: STAKEHOLDER DIALOGUE I.

COMMENTARY

17.208

CHAPTER 2: MEASURES TO FACILITATE COLLECTIVE LICENSING

COMMENTARY

17.214

17.217

I.

COMMENTARY

17.279

ARTICLE 21: ALTERNATIVE DISPUTE RESOLUTION PROCEDURE COMMENTARY

17.280

I.

COMMENTARY

17.281

ARTICLE 23: COMMON PROVISIONS I.

COMMENTARY

17.284

TITLE V: FINAL PROVISIONS

CHAPTER 1: RIGHTS IN PUBLICATIONS

ARTICLE 24: AMENDMENTS TO DIRECTIVES 96/9/EC AND 2001/29/EC

ARTICLE 15: PROTECTION OF PRESS PUBLICATIONS CONCERNING ONLINE USES COMMENTARY 1. Background

17.276

ARTICLE 22: RIGHT OF REVOCATION

TITLE IV: MEASURES TO ACHIEVE A WELL-FUNCTIONING MARKETPLACE FOR COPYRIGHT

I.

COMMENTARY

I.

ARTICLE 14: WORKS OF VISUAL ART IN THE PUBLIC DOMAIN COMMENTARY

17.274

ARTICLE 20: CONTRACT ADJUSTMENT MECHANISM

CHAPTER 4: WORKS OF VISUAL ART IN THE PUBLIC DOMAIN

I.

COMMENTARY

ARTICLE 19: TRANSPARENCY OBLIGATION I.

ARTICLE 13: NEGOTIATION MECHANISM COMMENTARY

CHAPTER 3: FAIR REMUNERATION IN EXPLOITATION CONTRACTS OF AUTHORS AND PERFORMERS

I. 17.209

CHAPTER 3: ACCESS TO AND AVAILABILITY OF AUDIOVISUAL WORKS ON VIDEO-ON-DEMAND PLATFORMS I.

17.250 17.250 17.251 17.257 17.259 17.263 17.264 17.266 17.267 17.273

ARTICLE 18: PRINCIPLE OF APPROPRIATE AND PROPORTIONATE REMUNERATION

ARTICLE 12: COLLECTIVE LICENSING WITH AN EXTENDED EFFECT I.

17.245 17.248

COMMENTARY 1. Communication to the public 2. Authorisation 3. No safe haven 4. The best efforts option 5. Start-ups 6. Exceptions and limitations 7. No general monitoring 8. The complaint and redress mechanism 9. The stakeholder dialogue

ARTICLE 10: PUBLICITY MEASURES I.

17.242 17.244

CHAPTER 2: CERTAIN USES OF PROTECTED CONTENT BY ONLINE SERVICES

ARTICLE 9: CROSS-BORDER USES I.

17.229 17.233 17.235 17.240

I.

COMMENTARY

17.285

17.224 17.224

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ARTICLE 1: SUBJECT MATTER AND SCOPE I.

ARTICLE 25: RELATIONSHIP WITH EXCEPTIONS AND LIMITATIONS PROVIDED FOR IN OTHER DIRECTIVES I.

COMMENTARY

17.286

17.288

ARTICLE 30: REVIEW ARTICLE 31: ENTRY INTO FORCE

ARTICLE 26: APPLICATION IN TIME

ARTICLE 32: ADDRESSEES

ARTICLE 27: TRANSITIONAL PROVISION I.

COMMENTARY

ARTICLE 29: TRANSPOSITION

COMMENTARY

17.287

I.

COMMENTARY

17.289

ARTICLE 28: PROTECTION OF PERSONAL DATA

TITLE I: GENERAL PROVISIONS ARTICLE 1: SUBJECT MATTER AND SCOPE 1.

2.

This Directive lays down rules which aim to harmonise further Union law applicable to copyright and related rights in the framework of the internal market, taking into account, in particular, digital and cross-border uses of protected content. It also lays down rules on exceptions and limitations to copyright and related rights, on the facilitation of licences, as well as rules which aim to ensure a well-functioning marketplace for the exploitation of works and other subject matter. Except in the cases referred to in Article 24, this Directive shall leave intact and shall in no way affect existing rules laid down in the directives currently in force in this area, in particular Directives 96/9/EC, 2000/31/EC, 2001/29/EC, 2006/115/EC, 2009/24/EC, 2012/28/EU and 2014/26/EU.

RELEVANT PARAGRAPHS FROM THE PREAMBLE (1)

(2)

(3)

The Treaty on European Union (TEU) provides for the establishment of an internal market and the institution of a system ensuring that competition in the internal market is not distorted. Further harmonisation of the laws of the Member States on copyright and related rights should contribute to the achievement of those objectives. The directives that have been adopted in the area of copyright and related rights contribute to the functioning of the internal market, provide for a high level of protection for rightholders, facilitate the clearance of rights, and create a framework in which the exploitation of works and other protected subject matter can take place. That harmonised legal framework contributes to the proper functioning of the internal market, and stimulates innovation, creativity, investment and production of new content, also in the digital environment, in order to avoid the fragmentation of the internal market. The protection provided by that legal framework also contributes to the Union’s objective of respecting and promoting cultural diversity, while at the same time bringing European common cultural heritage to the fore. Article 167(4) of the Treaty on the Functioning of the European Union requires the Union to take cultural aspects into account in its action. Rapid technological developments continue to transform the way works and other subject matter are created, produced, distributed and exploited. New business models and new actors continue to emerge. Relevant legislation needs to be future-proof so as not to restrict technological development. The objectives and the principles laid down by the Union copyright framework remain sound. However, legal uncertainty remains, for both rightholders and users, as regards certain uses, including cross-border uses, of works and

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Chapter 17 THE DIGITAL SINGLE MARKET DIRECTIVE

(4)

(5)

(6)

(7)

other subject matter in the digital environment. As stated in the Commission Communication of 9 December 2015 entitled ‘Towards a modern, more European copyright framework’, in some areas it is necessary to adapt and supplement the existing Union copyright framework, while keeping a high level of protection of copyright and related rights. This Directive provides for rules to adapt certain exceptions and limitations to copyright and related rights to digital and cross-border environments, as well as for measures to facilitate certain licensing practices, in particular, but not only, as regards the dissemination of out-of-commerce works and other subject matter and the online availability of audiovisual works on video-on-demand platforms, with a view to ensuring wider access to content. It also contains rules to facilitate the use of content in the public domain. In order to achieve a well-functioning and fair marketplace for copyright, there should also be rules on rights in publications, on the use of works or other subject matter by online service providers storing and giving access to user-uploaded content, on the transparency of authors’ and performers’ contracts, on authors’ and performers’ remuneration, as well as a mechanism for the revocation of rights that authors and performers have transferred on an exclusive basis. This Directive is based upon, and complements, the rules laid down in the directives currently in force in this area, in particular Directives 96/9/EC, 2000/31/EC, 2001/29/ EC, 2006/115/EC, 2009/24/EC, 2012/28/EU and 2014/26/EU of the European Parliament and of the Council. In the fields of research, innovation, education and preservation of cultural heritage, digital technologies permit new types of uses that are not clearly covered by the existing Union rules on exceptions and limitations. In addition, the optional nature of exceptions and limitations provided for in Directives 96/9/EC, 2001/29/EC and 2009/24/EC in those fields could negatively impact the functioning of the internal market. This is particularly relevant as regards cross-border uses, which are becoming increasingly important in the digital environment. Therefore, the existing exceptions and limitations in Union law that are relevant for scientific research, innovation, teaching and preservation of cultural heritage should be reassessed in the light of those new uses. Mandatory exceptions or limitations for uses of text and data mining technologies, illustration for teaching in the digital environment and for preservation of cultural heritage should be introduced. The existing exceptions and limitations in Union law should continue to apply, including to text and data mining, education, and preservation activities, as long as they do not limit the scope of the mandatory exceptions or limitations provided for in this Directive, which need to be implemented by Member States in their national law. Directives 96/9/EC and 2001/29/EC should, therefore, be amended. The exceptions and limitations provided for in this Directive seek to achieve a fair balance between the rights and interests of authors and other rightholders, on the one hand, and of users on the other. They can be applied only in certain special cases that do not conflict with the normal exploitation of the works or other subject matter and do not unreasonably prejudice the legitimate interests of the rightholders. The protection of technological measures established in Directive 2001/29/EC remains essential to ensure the protection and the effective exercise of the rights granted to authors and to other rightholders under Union law. Such protection should be maintained while ensuring that the use of technological measures does not prevent the enjoyment of the exceptions and limitations provided for in this Directive. Rightholders should have the opportunity to ensure that through voluntary measures. They should remain free to choose the appropriate means of enabling the beneficiaries of the exceptions and limitations provided for in this Directive to benefit from them. In the absence of voluntary measures, Member States should take appropriate measures in accordance with the first subparagraph of Article 6(4) of Directive 2001/29/EC, including where works and other subject matter are made available to the public through on-demand services.

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ARTICLE 1: SUBJECT MATTER AND SCOPE

I. COMMENTARY Article 1(1) states the obvious: that the Directive aims to harmonise further Union copyright and 17.01 related rights law taking into account in particular digital and cross-border uses of protected content within the internal market. This aim was already provided in the Commission Communication of 9 December 2015 entitled ‘Towards a modern, more European copyright framework’ and is pertinent to achieving the Digital Single Market, as this term is stated in the Directive’s title. Article 1(1) also enumerates in broad terms the areas where action is taken, i.e., it lays down rules on exceptions and limitations, on the facilitation of licences, as well as rules, which aim to ensure a well-functioning marketplace for the exploitation of works and other subject matter. More particularly according to Recital 3: This Directive provides for rules to adapt certain exceptions and limitations to copyright and related rights to digital and cross-border environments, as well as for measures to facilitate certain licensing practices, in particular, but not only, as regards the dissemination of out-of-commerce works and other subject matter and the online availability of audiovisual works on video-on-demand platforms, with a view to ensuring wider access to content. It also contains rules to facilitate the use of content in the public domain. In order to achieve a well-functioning and fair marketplace for copyright, there should also be rules on rights in publications, on the use of works or other subject matter by online service providers storing and giving access to user-uploaded content, on the transparency of authors’ and performers’ contracts, on authors’ and performers’ remuneration, as well as a mechanism for the revocation of rights that authors and performers have transferred on an exclusive basis.

Article 1(2) provides that this Directive is without prejudice and does not affect existing rules found 17.02 in the remaining Directives in the area. In fact, it is intended to work alongside them. Yet, it is specifically mentioned that Article 24 of the Directive amends certain rules of Directives 96/9/EC (on databases) and 2001/29/EC (on the Information Society) and thus the amended rules apply. Article 1 makes it obvious that the Directive takes a piecemeal, incremental and by no means 17.03 comprehensive approach towards the issue of harmonising Union copyright law. In fact, it consists of small corrective acts falling short of a holistic approach. This was due to the Member States’ lack of consensus on taking further action in the area.

NOTES 1. Related instruments Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases [1996] OJ L 77/20. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (‘Directive on electronic commerce’) [2000] OJ L 178/1. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/10. Directive 2006/115/EC of the European Parliament and of the Council of 12 December 2006 on rental right and lending right and on certain rights related to copyright in the field of intellectual property (codified version) [2006] OJ L 376/28. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs [2009] OJ L 111/16. Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works Text with EEA relevance [2012] OJ L 299/5. Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market Text with EEA relevance [2014] OJ L 84/72.

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ARTICLE 2: DEFINITIONS For the purposes of this Directive, the following definitions apply: (1)

(2) (3) (4)

(5) (6)

‘research organisation’ means a university, including its libraries, a research institute or any other entity, the primary goal of which is to conduct scientific research or to carry out educational activities involving also the conduct of scientific research: (a) on a not-for-profit basis or by reinvesting all the profits in its scientific research; or (b) pursuant to a public interest mission recognised by a Member State; in such a way that the access to the results generated by such scientific research cannot be enjoyed on a preferential basis by an undertaking that exercises a decisive influence upon such organisation; ‘text and data mining’ means any automated analytical technique aimed at analysing text and data in digital form in order to generate information which includes but is not limited to patterns, trends and correlations; ‘cultural heritage institution’ means a publicly accessible library or museum, an archive or a film or audio heritage institution; ‘press publication’ means a collection composed mainly of literary works of a journalistic nature, but which can also include other works or other subject matter, and which: (a) constitutes an individual item within a periodical or regularly updated publication under a single title, such as a newspaper or a general or special interest magazine; (b) has the purpose of providing the general public with information related to news or other topics; and (c) is published in any media under the initiative, editorial responsibility and control of a service provider. Periodicals that are published for scientific or academic purposes, such as scientific journals, are not press publications for the purposes of this Directive; ‘information society service’ means a service within the meaning of point (b) of Article 1(1) of Directive (EU) 2015/1535; ‘online content-sharing service provider’ means a provider of an information society service of which the main or one of the main purposes is to store and give the public access to a large amount of copyright-protected works or other protected subject matter uploaded by its users, which it organises and promotes for profit-making purposes. Providers of services, such as not-for-profit online encyclopedias, not-for-profit educational and scientific repositories, open source software-developing and -sharing platforms, providers of electronic communications services as defined in Directive (EU) 2018/1972, online marketplaces, business-to-business cloud services and cloud services that allow users to upload content for their own use, are not ‘online content-sharing service providers’ within the meaning of this Directive.

I. COMMENTARY 17.04 Article 2 of the Directive defines a number of terms that are relevant to the articles to follow. At the same time these definitions prescribe the scope of application of the Directive.

1. Research organisations 17.05 According to Recital 12 ‘[r]esearch organisations across the Union encompass a wide variety of entities the primary goal of which is to conduct scientific research or to do so together with the provision of educational services’. The Directive expressly provides that a research organisation means a university, including its libraries, a research institute or any other entity, the primary goal of

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ARTICLE 2: DEFINITIONS

which is to conduct scientific research or to carry out educational activities involving also the conduct of scientific research. ‘Scientific research’ covers both the natural sciences and the human sciences.1 Research organisations cover, in addition to universities or other higher education institutions and their libraries, also entities such as research institutes and hospitals that carry out research. Despite different legal forms and structures, research organisations in the Member States generally have in common that they act either on a not-for-profit basis or in the context of a public-interest mission recognised by the State. Such a public-interest mission could, for example, be reflected through public funding or through provisions in national laws or public contracts. Conversely, organisations upon which commercial undertakings have a decisive influence allowing such undertakings to exercise control because of structural situations, such as through their quality of shareholder or member, which could result in preferential access to the results of the research, should not be considered research organisations for the purposes of this Directive.2

The definition of research organisations is quite broad and places the emphasis on the activities of 17.06 the organisations (i.e., scientific research) rather than on the nature of the organisations themselves. This definition is relevant for the exception of text and data mining and – if seen in conjunction with it – encourages universities and research institutes to collaborate with the private sector, and benefit from such an exception when their research activities are carried out in the framework of public–private partnerships.3 Research organisations are also considered to be part of cultural heritage institutions.4

17.07

2. Text and data mining ‘Text and data mining’ means any automated analytical technique aimed at analysing text and data 17.08 in digital form in order to generate information, which includes but is not limited to patterns, trends and correlations. Text and data mining seems to form part of a wider concept: that of data analysis. Some would 17.09 argue though that the term ‘analysis’ may refer to techniques and tools that remain on the surface of the data to be analysed without really going deep into it by performing acts of reproduction and extraction.5 Yet, no prevailing view exists on the matter. What can be argued with certainty though is that the word ‘text’ does not seem to serve a particular purpose given the fact that the term ‘data’ is far more general and encompasses any type of work or subject matter, and not solely text.

1 2 3 4 5

Recital 12. Ibid. Recital 11. Recital 13. According to M. Borghi and S. Karapapa, Copyright and Mass Digitisation: A Cross-Jurisdictional Perspective, Oxford University Press, 2013, at 63 and ‘Study on the Legal Framework of text and data mining (TDM)’, De Wolf & Partners, J-P Triaille, J. de Meeûs d’Argenteuil and A. de Francquen, March 2014, at 9 where it is argued that: to ‘mine’ means ‘to extract data from texts qua informational resources’, whereas data analysis is encompassing much more than the mere extraction of data; it may vary from one technology to another, and may further extend to other activities than ‘mining’ or ‘extracting’, depending on the context, the technology and the sectors involved […]. See later though in De Wolf & Partners (at 10) that; it is often understood that ‘to mine’ content means ‘to go deep into’ texts, video, images, photos, etc. whereas some data analysis techniques ‘stay on the surface’ of texts, video, images, photos, etc. This latter interpretation is also more consistent with the meaning of the word ‘analysis’ deriving from the Greek word ‘αναλυ´ ω’ which means I look into something and explain it in order to understand it.

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According to the Database Directive, for example, ‘data’ encompasses any type of content such as texts, sounds, images, information and so on.6 17.10 The Directive’s definition is in line with existing definitions in the laws of Member States that already provided for such an exception as well as with the relevant literature in the area.7 17.11 Some examples:

A. United Kingdom 17.12 The UK8 provides for an exception with regard to text and data analysis for non-commercial research. According to Article 29:9 (1) The making of a copy of a work by a person who has lawful access to the work does not infringe copyright in the work provided that (a) the copy is made in order that a person who has lawful access to the work may carry out a computational analysis of anything recorded in the work for the sole purpose of research for a non-commercial purpose, and (b) the copy is accompanied by a sufficient acknowledgement (unless this would be impossible for reasons of practicality or otherwise). (2) Where a copy of a work has been made under this section, copyright in the work is infringed if (a) the copy is transferred to any other person, except where the transfer is authorised by the copyright owner, or (b) the copy is used for any purpose other than that mentioned in subsection (1)(a), except where the use is authorised by the copyright owner. (3) If a copy made under this section is subsequently dealt with (a) it is to be treated as an infringing copy for the purposes of that dealing, and (b) if that dealing infringes copyright, it is to be treated as an infringing copy for all subsequent purposes. (4) In subsection (3) ‘dealt with’ means sold or let for hire, or offered or exposed for sale or hire. (5) To the extent that a term of a contract purports to prevent or restrict the making of a copy which, by virtue of this section, would not infringe copyright, that term is unenforceable.

17.13 Also in Schedule 2(5), immediately before paragraph 2, it is provided that: 1D.— (1) The making of a copy of a recording of a performance by a person who has lawful access to the recording does not infringe any rights conferred by this Chapter provided that the copy is made in order that a person who has lawful access to the recording may carry out a computational analysis of anything recorded in the recording for the sole purpose of research for a non-commercial purpose. (2) Where a copy of a recording has been made under this paragraph, the rights conferred by this Chapter are infringed if (a) the copy is transferred to any other person, except where the transfer is authorised by the rights owner, or (b) the copy is used for any purpose other than that mentioned in sub-paragraph (1), except where the use is authorised by the rights owner.

6

7 8 9

See Art. 1.2 of the Database Directive which provides that a database is ‘a collection of works, data or other materials arranged in a systematic or methodical way and individually accessible by electronic or other means’ and Recital 17 which provides that ‘the term “database” should be understood to include literary, artistic, musical or other collections of works or collections of other material such as texts, sound, images, number, facts, and data’. See the interpretation of these provisions in I. Stamatoudi, ‘The EU Database Directive: Reconceptualising copyright and tracing the future of the sui generis right’ (1997) 50 Revue Hellénique de droit International 435. See I. Stamatoudi, ‘Text and Data Mining’, in I. Stamatoudi (ed), New Developments in EU and International Copyright Law, Information Law Series (B. Hugenholtz (general editor)), Wolters Kluwer, 2016, 251. The Copyright and Rights in Performances (Research, Education, Libraries and Archives) Regulations 2014 No. 1372 came into force on 1 June 2014 and amends the Copyright, Designs and Patents Act 1988. Art. 29: ‘copies for text and data analysis for non-commercial research’.

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ARTICLE 2: DEFINITIONS (3) If a copy of a recording made under this paragraph is subsequently dealt with – (a) it is to be treated as an illicit recording for the purposes of that dealing, and (b) if that dealing infringes any right conferred by this Chapter, it is to be treated as an illicit recording for all subsequent purposes. (4) To the extent that a term of a contract purports to prevent or restrict the making of a copy which, by virtue of this paragraph, would not infringe any right conferred by this Chapter, that term is unenforceable. (5) Expressions used in this paragraph have the same meaning as in section 29A.

Thus, according to UK law, the term ‘text and data analysis’ (rather than mining), refers to a 17.14 computational analysis of anything recorded in a work or in a recording of a performance to which one has lawful access.

B. Ireland In Ireland there has only been a proposal to this end in the context of a Consultation Paper 17.15 published in 2012.10 Yet, this proposal never went through and therefore does not amend the Irish Copyright and Related Rights Act (CRRA). According to it (106F. Digital analysis and research): (1) It is not an infringement of the rights conferred by this Act for a person to reproduce a work for a purpose to which this section applies if (a) it would not be practical to carry out the research without making the copy, (b) the person is the owner or lawful user of the work, and (c) the person has informed the owner of the rights in the work, unless this is unreasonable or inappropriate or turns out to be impossible for reasons of practicality or otherwise. (2) This section applies to (a) text-mining, data-mining, and similar analysis or research, (b) encryption research and similar analysis or research, and (c) such other analysis or research as the Minister may by order provide. (3) Nothing in Part VII shall be construed as operating to prevent any person from undertaking the acts permitted by this section or from undertaking any act of circumvention required to effect such permitted acts.

Ireland seems to favour a rather broad approach encompassing any type of analysis or research, 17.16 including text and data mining, of any work by a person who is the owner or lawful user of the work under the conditions prescribed above. 17.17

Example of non-EU States:

C. Japan Japan provides in its copyright law for an exception for information analysis,11 which it defines as 17.18 follows: to extract information, concerned with languages, sounds, images or other elements constituting such information, from many works or other such information, and to make a comparison, a classification or other statistical analysis of such information; the same shall apply hereinafter in this Article by using a computer, it shall be permissible to make recording on a memory, or to make adaptation (including a recording of a derivative work created by such adaptation) of a work, to the extent deemed necessary […].12

10 11 12

Copyright Review Committee, Copyright and Innovation: A Consultation Paper for the Minister for Jobs, Enterprise and Innovation, Dublin 2012, http://www.djei.ie/science/ipr/crc_consultation_paper.pdf. See art. 47-7 of s. 5 on ‘Limitations to Copyright’ of the Japanese Copyright Act, as amended in 2009. See Copyright Research and Information Center, ‘Copyright Law of Japan’, Art. 47septies, http://www.cric.or.jp/ english/clj/cl2.html#cl2_1+A47septies.

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17.19 The AIPPI Japanese Group in its Report on ‘Exceptions to copyright protection and the permitted uses of copyright works in the hi-tech and digital sectors’ mentions that the types of works subject to this provision are not limited.13 The Report also mentions that: the Subdivision on Copyright of the Council for Cultural Affairs issued a Study in January 2009 where it presents the following examples of information analysis: (1) website information analysis and language analysis in which the use of a specific language or character string is analysed and statistically processed and (2) sound analysis and video/image analysis in which the meaning of the sound wave, video, character string, etc., comprising a certain sound, video, image, etc., is analysed. However, the types of information analysis should not be limited to these examples.

17.20 Databases made for data analysis purposes are excluded from the scope of the exception. This forms an exception to the exception and seems compatible with the three-step test of the Berne Convention.14 Any other provision would conflict with the normal exploitation of the work and would unreasonably prejudice the legitimate interests of the author. 17.21 Overall, the Japanese exception is rather broad in scope concerning the subject matter for protection irrespective of the fact that its law provides for works (or other such information) rather than data. A potential explanation could be that since data are not protected by exclusive rights that may prevent their analysis (including database rights, as those found in the EU), no particular reference to them was needed. Limiting factors to the information analysis constitute (a) the use of computer means and (b) the fact that such analysis can only take place ‘to the extent deemed necessary’. In practice, of course, such analysis can only be conducted by means of a computer, whilst the prerequisite of ‘the extent deemed necessary’ is dictated by the three-step test and by a strict and narrow interpretation of it concerning the limitations and exceptions to copyright.

D. United States 17.22 Although no ad hoc cases exist to my knowledge on text and data mining in the US it seems that the flexible ‘fair use’ defence15 is capable of accommodating such instances.16 It provides for four factors to be considered: (a) the purpose and character of the use, (b) the nature of the copyright work, (c) the amount and substantiality of the portion taken, and (d) the effect of the use upon the potential market. At the same time, it provides for an open-ended list of cases (referred to as ‘purposes’) in relation to which a use may be considered fair.

13 14 15

At p. 9, https://www.aippi.org/download/commitees/216B/GR216Bjapan.pdf. Art. 9.2. of the Berne Convention. US Copyright Act 1976, § 107: the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include: the purpose and character of the use, including whether such use is of a commercial nature or is for non-profit educational purposes; the nature of the copyrighted work; the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and the effect of the use upon the potential market for or value of the copyrighted work. The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors.

16

P. Samuelson, ‘The EU’s Controversial Digital Single Market Directive – Part II: Why the Proposed Mandatory Textand Data-Mining Exception Is Too Restrictive’, 12 July 2018, Kluwer Copyright Blog http://copyrightblog. kluweriplaw.com/2018/07/12/eus-controversial-digital-single-market-directive-part-ii-proposed-mandatory-text-datamining-exception-restrictive/?doing_wp_cron=1591177637.4914610385894775390625.

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3. ‘Cultural heritage institution’ 17.23

According to Recital 13: cultural heritage institutions should be understood as covering publicly accessible libraries and museums regardless of the type of works or other subject matter that they hold in their permanent collections, as well as archives, film or audio heritage institutions. They should also be understood to include, inter alia, national libraries and national archives, and, as far as their archives and publicly accessible libraries are concerned, educational establishments, research organisations and public sector broadcasting organisations.

The term cultural heritage institutions is used in several articles in the Directive, such as Articles 3, 17.24 6, 8, 9, 10 and 11, which indicates that the Directive aims to promote cultural heritage in general and the aims and work of cultural heritage institutions in particular, in the digital environment.

4. ‘Press publication’ The notion of press publications is relevant for Article 15, i.e., the protection of press publications 17.25 concerning online uses. In this light the notion of press publications is defined so as to limit the scope of application of the relevant articles to those cases only for which it is intended. According to the Directive ‘press publication’ means a collection composed mainly of literary works 17.26 of a journalistic nature. According to Recital 56 that ‘covers journalistic publications, published in any media, including on paper, in the context of an economic activity that constitutes a provision of services under Union law’. That covers, for example, daily newspapers, weekly or monthly magazines of general or special interest, including subscription-based magazines, and news websites. Press publications contain mostly literary works, but other types of works or other subject matter are not excluded. These may be, for example, photographs or videos. The definition provides that the works or subject matter included in the press publication should (a) constitute an individual item within a periodical or regularly updated publication under a single title, such as a newspaper or a general or special interest magazine; (b) have the purpose of providing the general public with information related to news or other topics; and (c) be published in any media under the initiative, editorial responsibility and control of a service provider. Periodical publications published for scientific or academic purposes, such as scientific journals, are not covered. Neither does this protection apply to websites, such as blogs, that provide information as part of an activity that is not carried out under the initiative, editorial responsibility and control of a service provider, such as a news publisher.

5. ‘Information society service’ Information society service means a service within the meaning of point (b) of Article 1(1) of 17.27 Directive (EU) 2015/1535 of 9 September 2015 (laying down a procedure for the provision of information in the field of technical regulations and of rules on Information Society services). According to this ‘service’ means any Information Society service, that is to say, any service normally provided for remuneration, at a distance, by electronic means and at the individual request of a recipient of services. For the purposes of this definition: (i) ‘at a distance’ means that the service is provided without the parties being simultaneously present; (ii) ‘by electronic means’ means that the service is sent initially and received at its destination by means of electronic equipment for the processing (including digital compression) and storage of data, and entirely transmitted, conveyed and received by wire, by radio, by optical means or by other electromagnetic means; (iii) ‘at the individual request of a recipient of services’ means that the service is provided through the

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transmission of data on individual request. Annex I of the Directive provides for an indicative list of services not covered by this definition.17 17.28 Certain information society services, as part of their normal use, are designed to give access to the public to copyright-protected content or other subject matter uploaded by their users.18 17.29 The notion of ‘information society service’ is also clarified in certain special cases dealt with by the Court of Justice (e.g., Judgment of 10 April 2018, Uber France, Case C-320/16, EU:C:2018:221, paragraphs 18–28; Judgment of 20 December 2017, Asociación Profesional Elite Taxi, Case C-434/ 15, EU:C:2017:981, paragraph 48; Judgment of 20 December 2017, Falbert and Others, Case C-255/16, EU:C:2017:983, paragraphs 27–30; Judgment of 2 February 2016, Ince, Case C-336/14, EU:C:2016:72, paragraphs 75–76, 79, 84).

6. ‘Online content-sharing service provider’ 17.30 ‘Online content-sharing service providers’ (OCSSP) is a long term indicating the special types of intermediaries caught by the provisions of this Directive. The emphasis is placed on (a) the storage and provision to the public of access, (b) to a large amount of copyright or related rights’ protected works or subject matter respectively, and where (c) the providers – although the content is uploaded by the users – intervene by organising or promoting this service for profit-making purposes (i.e., OCSSP means a provider of an information society service of which the main or one of the main purposes is to store and give the public access to a large amount of copyright-protected works or other

17

Annex I: Indicative list of services not covered by the second subparagraph of point (b) of Article 1(1) 1. Services not provided ‘at a distance’ Services provided in the physical presence of the provider and the recipient, even if they involve the use of electronic devices: (a) medical examinations or treatment at a doctor’s surgery using electronic equipment where the patient is physically present; (b) consultation of an electronic catalogue in a shop with the customer on site; (c) plane ticket reservation at a travel agency in the physical presence of the customer by means of a network of computers; (d) electronic games made available in a video arcade where the customer is physically present. 2. Services not provided ‘by electronic means’ — services having material content even though provided via electronic devices: (a) automatic cash or ticket dispensing machines (banknotes, rail tickets); (b) access to road networks, car parks, etc., charging for use, even if there are electronic devices at the entrance/exit controlling access and/or ensuring correct payment is made, — offline services: distribution of CD-ROMs or software on diskettes, — services which are not provided via electronic processing/inventory systems: (a) voice telephony services; (b) telefax/telex services; (c) services provided via voice telephony or fax; (d) telephone/telefax consultation of a doctor; (e) telephone/telefax consultation of a lawyer; (f) telephone/telefax direct marketing. 3. Services not supplied ‘at the individual request of a recipient of services’ Services provided by transmitting data without individual demand for simultaneous reception by an unlimited number of individual receivers (point to multipoint transmission): (a) television broadcasting services (including near-video on-demand services), covered by point (e) of Article 1(1) of Directive 2010/13/EU; (b) radio broadcasting services; (c) (televised) teletext.

18

Recital 62.

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protected subject matter uploaded by its users, which it organises and promotes for profit-making purposes) [emphasis added]. The law is express on the fact that not-for-profit services, such as not-for-profit online encyclo- 17.31 pedias, not-for-profit educational and scientific repositories, as well as open source softwaredeveloping and -sharing platforms, providers of electronic communications services as defined in Directive (EU) 2018/1972 (of the European Parliament and of the Council of 11 December 2018 establishing the European Electronic Communications Code), online marketplaces, business-tobusiness cloud services and cloud services that allow users to upload content for their own use, are not covered by the Directive and therefore are not considered to come within the notion of ‘online content-sharing service providers’. 17.32

According to Recital 62 the definition was drafted in such a way so as to: […] target only online services that play an important role on the online content market by competing with other online content services, such as online audio and video streaming services, for the same audiences. The services covered by this Directive are services, the main or one of the main purposes of which is to store and enable users to upload and share a large amount of copyright-protected content with the purpose of obtaining profit therefrom, either directly or indirectly, by organising it and promoting it in order to attract a larger audience, including by categorising it and using targeted promotion within it. Such services should not include services that have a main purpose other than that of enabling users to upload and share a large amount of copyright-protected content with the purpose of obtaining profit from that activity. The latter services include, for instance, electronic communication services within the meaning of Directive (EU) 2018/1972 […], as well as providers of business-to-business cloud services and cloud services, which allow users to upload content for their own use, such as cyberlockers, or online marketplaces the main activity of which is online retail, and not giving access to copyright-protected content.

The Directive also expressly provides – as was expected – (in Recital 62) that in order to ensure a 17.33 high level of copyright protection, the liability exemption mechanism – enshrined in this Directive for OCSSPs – does not apply to service providers the main purpose of which is to engage in or to facilitate copyright piracy.

NOTES 1. Related instruments Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market [2014] OJ L 84/72. Directive (EU) 2015/1535 of the European Parliament and of the Council of 9 September 2015 laying down a procedure for the provision of information in the field of technical regulations and of rules on Information Society services [2015] OJ L 241/1. Directive (EU) 2018/1972 of the European Parliament and of the Council of 11 December 2018 establishing the European Electronic Communications Code (Recast) [2018] OJ L 321/36.

2. CJEU case law Case C-320/16 Uber France ECLI:EU:C:2018:221. Case C-434/15 Asociación Profesional Elite Taxi ECLI:EU:C:2017:981. Case C-255/16 Falbert and Others ECLI:EU:C:2017:983. Case C-336/14 Ince ECLI:EU:C:2016:72.

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TITLE II: MEASURES TO ADAPT EXCEPTIONS AND LIMITATIONS TO THE DIGITAL AND CROSS-BORDER ENVIRONMENT ARTICLE 3: TEXT AND DATA MINING FOR THE PURPOSES OF SCIENTIFIC RESEARCH 1.

2. 3. 4.

Member States shall provide for an exception to the rights provided for in Article 5(a) and Article 7(1) of Directive 96/9/EC, Article 2 of Directive 2001/29/EC, and Article 15(1) of this Directive for reproductions and extractions made by research organisations and cultural heritage institutions in order to carry out, for the purposes of scientific research, text and data mining of works or other subject matter to which they have lawful access. Copies of works or other subject matter made in compliance with paragraph 1 shall be stored with an appropriate level of security and may be retained for the purposes of scientific research, including for the verification of research results. Rightholders shall be allowed to apply measures to ensure the security and integrity of the networks and databases where the works or other subject matter are hosted. Such measures shall not go beyond what is necessary to achieve that objective. Member States shall encourage rightholders, research organisations and cultural heritage institutions to define commonly agreed best practices concerning the application of the obligation and of the measures referred to in paragraphs 2 and 3 respectively.

I. COMMENTARY 1. Introduction 17.34 Text and data mining (TDM) is considered a means of research. It forms one of the techniques used for collecting information from an indefinite number of digital data (‘Big Data’),19 which focuses on particular words, themes or subject matter with the help of an automated tool. It aims at analysing or combining data in order to provide knowledge and insight into any scientific or non-scientific field. TDM can be very useful for any kind of researchers varying from students and

19

Humans create 2.5 quintillion bytes of data every day and 90 per cent of the data in today’s world has been created in the last two years. The volume of data is doubling every three years. See Big Data at the Speed of Business, New York, IBM, 2014, http://www-01.ibm.com/software/data/bigdata/what-is-big-data.html. See also Gartner, Gartner Says Solving ‘Big Data’ Challenge Involves More Than Just Managing Volumes of Data, Press Release (Stamford: Gartner, 2011). The proliferation of the internet, the rise of user-generated content and the digitisation of traditional industries and services have given rise to an explosive growth of data. Viktor Mayer-Schönberger and Kenneth Cukier, Big Data: A Revolution that Will Transform How We Live, Work and Think (London: John Murray, 2013); Sarah Buchholtz, Maciej Bukowski and Aleksander Sniegocki, Big and Open Data in Europe (Warsaw: DemosEUROPA, 2014). Facebook users share over 30 million pieces of content per month, and Twitter has 350 million tweets daily. Diane McDonald and Ursula Kelly, Value and Benefits of Text Mining (Bristol: JISC, 2012).

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academics to medical firms and governmental organisations.20 It may also constitute a non-profit21 or for-profit service.22 Text and data mining presupposes in many cases (depending on the tool used and the outcome 17.35 intended) the processing, extraction and copying of the information mined. According to copyright law many of these acts fall within the authors’ exclusive and absolute rights and require their prior authorisation. It is not entirely clear (though highly unlikely) whether text and data mining is covered by some kind of exception or limitation according to the current EU legal framework.23 This is so for a reason. First, this was not an issue taken into account when the Information Society Directive was drafted. Second, EU law has a closed list of exceptions rather than a flexible norm, such as ‘fair dealing’ or ‘fair use’.24 Whether TDM can be accommodated by the existing EU legislative framework has constituted one 17.36 of the issues of discussion and analysis in the European Union during recent years. More specifically, it formed part of the European Commission’s Consultation in 201325 and of a study that was commissioned by it and delivered in March 2014.26 It was also discussed between Member

20 21

22

Paul Hofheinz and Michael Mandel, Bridging the Data Gap: How Digital Innovation Can Drive Growth and Create Jobs (Brussels and Washington, DC: Lisbon Council and PPI, 2014). The use of text and data mining also has important repercussions for academia. Annually, the global academic and research community generates over 1.5 million new scholarly articles; with an estimated 50 million academic articles in circulation as of 2010. Such volumes of material have outstripped the ability of individuals to access, read and analyse these publications. Hence, specifically in the global academic and research community, text and data mining has the potential to enhance very significantly current practices. Sergey Filippov, Mapping text and data mining in academic and research communities in Europe, The Lisbon Council, Issue 16/2004, at 2, http://www.lisboncouncil.net/publication/publication/109-mapping-text-and-datamining-in-academic-and-research-communities-in-europe.html), who refers to Diane McDonald and Ursula Kelly, Value and Benefits of Text Mining (Bristol: JISC, 2012) and Arif Jinha, ‘Article 50 Million: An Estimate of the Number of Scholarly Articles in Existence’ (2010) 23(3) Learned Publishing 258–63. A report published by McKinsey Global Institute in 2012 (James Manyika, Michael Chui, Brad Brown, Jacques Bughin, Richard Dobbs, Charles Roxburgh and Angela Hung Byers, Big Data: The Next Frontier for Innovation, Competition, and Productivity (San Francisco: McKinsey Global Institute, 2011) as referred to in Sergey Filippov, Mapping text and data mining in academic and research communities in Europe, The Lisbon Council, Issue 16/2004, at 2, http://www.lisboncouncil.net/publication/publication/109-mapping-text-and-data-mining-in-academicand-research-communities-in-europe.html) suggested a substantial economic potential for text and data mining methods: If US healthcare, for example, were to use data more creatively and effectively to drive efficiency and quality, the study found that the sector could create more than $300 billion [or €215 billion] in value every year. In the developed economies of Europe, government administrators could save more than €100 billion in operational efficiency improvements alone by using data more effectively, not including using data to reduce fraud and errors and boost the collection of tax revenues. In total that would lead to $250 billion [or €180 billion] of potential annual value to Europe’s public sector administration, according to the McKinsey study. Users of services enabled by personal-location data could capture $600 billion [or €430 billion] in consumer surplus.

23

24

25 26

See also Report of the Expert Group. Standardisation in the area of innovation and technological development, notably in the field of text and data mining. European Commission, 2014, at 6–7. Europe’s intellectual property regime – including copyright – may have worked well in an economy where knowledge was stored mostly in text on paper and analysed typically by scholars taking notes. In the digital age, new technologies make analysis of large volumes of text and other media potentially routine. But this can only happen if researchers have clearly established rights to use the relevant techniques, supported by the necessary skills and experience. Filippov, ibid., at 2. See Chr. Geiger, I. Stamatoudi, Fr. Schönherr and P. Torremans, ‘The Information Society Directive’, in I. Stamatoudi and Paul Torremans (eds), EU Copyright Law (Edward Elgar Publishing, Cheltenham (UK), Northampton (US), 2014), 395. Public Consultation launched by the European Commission on 5 December 2013. De Wolf & Partners, et al., note 5.

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States during the Hellenic Presidency in the Council of the European Union.27 In addition, it formed one of the issues under discussion in the ‘Licenses for Europe’.28 On 6 May 2015 the European Commission published a Communication on a Digital Single Market Strategy for Europe,29 which proposes a package of measures aimed at reducing or neutralising the negative effects of disparities in the national copyright laws of the Member States. These measures are there to attain a unified digital market and are expected to have been implemented by the end of 2015. In this light, ‘greater legal certainty for the cross-border use of content for specific purposes (e.g. research, education, text and data mining, etc.) through harmonised exceptions’30 was envisaged. In other words, the European Commission revealed that it had plans to introduce an exception concerning TDM and had abandoned any attempts to explore further licensing solutions to the issue. The results of all those efforts were Articles 3 and 4 of the DSM Directive.

2. Definition 17.37 TDM seems to form part of a wider concept: the concept of data analysis. Some would argue that the term ‘analysis’ may refer to techniques and tools that remain on the surface of the data to be analysed without really going deeply into it by performing acts of reproduction and extraction.31 Yet, no prevailing view exists on the matter. What can be argued with certainty, though, is that the word ‘text’ does not seem to serve a particular purpose given the fact that the term ‘data’ is far more general and encompasses any type of work or subject matter, and not solely text. According to the Database Directive, for example, ‘data’ encompasses any type of content such as texts, sounds, images, information and so on.32 17.38 Article 2 of the DSM Directive provides that ‘“text and data mining” means any automated analytical technique aimed at analysing text and data in digital form in order to generate information which includes but is not limited to patterns, trends and correlations’.33

27

28

29

30 31 32

33

First semester of 2014. See the minutes of a Presidency Conference held in Athens in June 2014. I. Stamatoudi (ed), Copyright and the Digital Agenda for Europe: Current Regulations and Challenges for the Future (Sakkoulas Publications, Athens, Thessaloniki, P.N. Sakkoulas, 2015). As announced in the Communication on ‘Content in the Digital Single Market’ (18 December 2012), ‘Licences for Europe ’ was an initiative jointly led by Commissioners Michel Barnier (Internal Market and Services), Neelie Kroes (Digital Agenda) and Androulla Vassiliou (Education, Culture, Multilingualism and Youth). Its main purpose was to seek to deliver rapid progress in bringing content online through practical industry-led solutions. See also the Report of the Expert Group. Standardisation in the area of innovation and technological development, notably in the field of text and data mining, European Commission, 2014. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, A Digital Single Market Strategy for Europe, Brussels, 6.5.2015 COM (2015) 192 final. See also the Commission Staff Working Document, A Digital Single Market Strategy for Europe – Analysis and Evidence (Brussels, 6.5.2015 SWD(2015) 100 final), Accompanying the document Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, A Digital Single Market Strategy for Europe and the Roadmap for completing the Digital Single Market http://ec.europa.eu/priorities/digital-single-market/. See the EU Communication, note 28, at pp. 7, 8 and 14. According to Borghi and Karapapa, note 5, at 63 and De Wolf & Partners, et al., note 5, at 9 and 10. See Art. 1.2 of the Database Directive which provides that a database is: ‘a collection of works, data or other materials arranged in a systematic or methodical way and individually accessible by electronic or other means’ and Recital 17 which provides that ‘the term “database” should be understood to include literary, artistic, musical or other collections of works or collections of other material such as texts, sound, images, number, facts, and data’. See the interpretation of these provisions in I. Stamatoudi, ‘The EU Database Directive: Reconceptualising copyright and tracing the future of the sui generis right’ (1997) 50 Revue Hellénique de droit International 435. For more information on the definition and national stances on the matter see the commentary on Art. 2.

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3. Relevant economic rights Before we look into what rights are relevant in TDM from a copyright law point of view, we first 17.39 need to address the acts that take place during this process. There is considerable literature concerning the various techniques or methods of analysis. Reference, for example, is made to the ‘ETL’ (that is Extract, Transform and Load) or the ‘ELT’ (that is Extract, Load and Transform) techniques.34 In both cases, the acts that take place are (a) the extraction of content from the work/subject matter/data analysed or mined, (b) a transformation of it in order for it to become compatible with the mining tool and be adjusted to its operational needs, (c) a loading of the content into a data set, repository or collection. Last but not least, (d) the data miners access the data to be mined and apply to it the mining tools. If we compare the two techniques (ELT and ETL) we note that there is a reversion of the order of the last two steps, i.e., transform and load or load and transform. The difference lies in the place where the processing happens: while the ETL processing of data happens in the ETL tool (transformation of the data in a cache or RAM memory, the data being loaded afterwards), the ELT processing of data happens in the database engine.35 The process described above relates both to uses concerning the works or data at issue and (if the 17.40 work mined/analysed is considered a compilation or a database) to the selection and arrangement of its contents, i.e., its structure. It is also clear from the above that, at some stage, such acts, on most occasions36 (but not always), 17.41 involve some act of copying. This is also indicated by the fact that the national laws set out above refer to acts of copying and introduce an exception to the right of reproduction. Even if copying is limited, i.e., only small parts of the text are copied, there is still a possibility that 17.42 these parts are protected by copyright. In Infopaq37 the Court of Justice came to the conclusion that (a) even an excerpt of 11 words may be protected and (b) to the extent that it forms the expression of its author’s own intellectual creation. This judgment on the one hand, includes within the scope of copyright protection even small excerpts of literary (or other) works and on the other, it extends the EU originality criterion to all types of works.38

34 35

36

37

Other techniques are also available. De Wolf & Partners, et al, note 5, at 30–31, which refers to Stackexchange.com, ‘Questions’, ‘What are the arguments in favor of using ELT process over ETL?’, http://dba.stackexchange.com/questions/19242/what-are-the-argumentsin-favor-of-using-elt-process-over-etl. See also R. Thirumagal, R. Suganthy, S. Mahima, G. Kesavaraj, ‘ETL Tools in Data Mining. A Review’ (2014) 2(1) International Journal of Research in Computer Applications and Robotics 62–9, http://www.ijrcar.com/Volume_2_Issue_1/v2i113.pdf. See Borghi and Karapapa note 5, p. 51; see also A. Guadamuz and D. Campbell, ‘Data mining in UK higher education institutions: law and policy’ (2014) Queen Mary Journal of Intellectual Property 4(1), 3–29, p. 6; S. Ananiadou, ‘Text Mining, IPR, Derived Data and Licensing’, powerpoint presentation on behalf of NaCTeM; http://ec.europa.eu/ licenses-for-europe-dialogue/node/7; S.M. Weiss, N. Indurkhya and T. Zhang, Fundamentals of Predictive Text Mining, Texts in Computer Sciences (Springer, 2010), p. 15; Universities UK and UK Higher Education International Unit, ‘European Commission’s Stakeholder Dialogue “Licenses for Europe” and Text and Data Mining’, http:// international.ac.uk/media/2243028/Briefing%20http://international.ac.uk/media/2243028/Briefing – Licenses for Europe and Text and Data MiningREVISED.pdf%20Licenses%20for%20Europe%20and%20Text%20and%20Data% 20MiningREVISED.pdf. Case C-5/08, Infopaq International A/S v. Danske Dagblades Forening, 16 July 2009: An act occurring during a data capture process, which consists of storing an extract of a protected work comprising 11 words and printing out that extract, is such as to come within the concept of reproduction in part within the meaning of Article 2 of Directive 2001/29 on the harmonisation of certain aspects of copyright and related rights in the information society, if the elements thus reproduced are the expression of the intellectual creation of their author; it is for the national court to make this determination.

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It is expressly referred to in EU law only in relation to photographs, software and databases. This is especially so for the civil law countries, which traditionally provided for a higher originality criterion (e.g., Greece provides for the

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17.43 The cases where the mining or analysis tool may not extract parts of the works or other subject matter are those where it only ‘crawls’ through the data, processes each item (word or other) separately without copying it but only recording, for example, its occurrence; or in some cases the copying is really minimal, consisting of one, two or three words at a time before the tool moves on to the next occurrence and not necessarily keeping a copy of them. 17.44 Given the above (and taking into account that the instances where no copying takes place will be rather limited), the right of reproduction is involved. 17.45 TDM may also involve the rights of translation and adaptation in relation to the ‘transform’ acts. Although the Information Society Directive does not expressly refer to the adaptation and translation rights, it could be argued that they are included within the scope of the reproduction right by reason of its very broad definition.39 The rights of translation, adaptation, arrangement and any other alteration are expressly provided for in relation to databases (Art. 5(b) of the Databse Directive) and software (Art. (1)(b) of the Software Directive). 17.46 Other rights, such as the right of distribution, communication to the public, etc. do not seem to be relevant since they mostly relate to the final outcome of the mining process (i.e., the output), which, most of the time, will not include parts or extracts of the original material that is mined. 17.47 For the purposes of this chapter we shall examine two EU legal instruments: the Information Society Directive40 and the Database Directive.41

II. INFORMATION SOCIETY DIRECTIVE 17.48 The right of reproduction subsists in the rightholders’ exclusive right to authorise or prohibit the direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part, of their works or subject matter.42 17.49 Walter and von Lewinski explain: The notion of reproduction is to be understood in a broad sense and is determined technically rather than functionally, in order effectively to protect the author against the use of his works by third parties without his consent. Hence, the reproduction right according to Article 2 of the Information Society Directive extends to every act of reproduction, however transient or irrelevant it may be from an economic or functional perspective. This concept results in the mere use of a work being considered subject to the author’s consent, whenever such use necessitates reproduction.43

39 40 41 42

43

‘statistically unique criterion’ according to which no other person under similar circumstances and with the same aim in mind, would not reasonably reach the same creative outcome) compared to the criterion provided for in common law countries (e.g., the UK criterion provides that in order for a work to be original it suffices that it is not a copy of another work). See I. Stamatoudi and G. Koumantos, Greek Copyright Law (P. Sakkoulas, Athens, 2014), at 22 et seq. and Λ. Κοτσι´ρης and Ε. Σταµατου´ δη (eds), Νο´ µος για την Πνευµατικη´ Ιδιοκτησι´α. Κατ’ α´ ρθρον Ερµηνει´α (Commentary on the Greek Copyright Act) (Sakkoulas Publications, Athens – Thessaloniki, 2009), at 31 et seq. De Wolf & Partners, et al., note 5, at 34. 2001/29/EC, OJ L167/10. 1996/9/EC, OJ L77/20. Art. 2 of the Information Society Directive provides that ‘The Member States shall provide for the exclusive right to authorise or prohibit direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part: (a) for authors of their works.’ Geiger, et al., note 24, 395, at 402. M. Walter and S. von Lewinski, European Copyright Law: A Commentary (OUP, Oxford, 2010), pp. 967 and 968.

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Overall, any act that reproduces the work is considered to constitute reproduction. Some might 17.50 argue that the shifting of formats or other adaptations in order for the needs of the operational tool to be met including changes or translation in another software language, which in fact is an automated process and does not require any creative choices as it is performed by a machine rather than a human being, may also qualify as an act of reproduction. The only copies that are excluded from the reproduction right are the ones exempted mandatorily 17.51 under Article 5(1) of the Information Society Directive; these are copies which are transient or incidental and form an integral and essential part of a technological process and whose sole purpose is to enable: (a) a transmission in a network between third parties by an intermediary, or (b) a lawful use of a work or other subject matter to be made, and which have no independent economic significance. This means that transmissions between networks, servers or routers of internet service providers where multiple copies are made in order to facilitate the transmission process, and which are not stored or are stored for a limited amount of time and only in the process of such transmission, are exempted altogether. The same applies to copies that are made in the process of conducting a lawful action, such as, for example, the making of copies in the RAM memory of a computer in order to listen to a piece of music one has legally purchased from the internet. Such acts are not supposed to have independent economic significance. If these acts were not expressly exempted in the Directive, their exemption by means of interpreting the scope of the reproduction right would impinge on the filter of the three-step test (applying to the exceptions and limitations to the exclusive rights of authors and related rightholders). These exceptions are put there in order to avoid the unnecessary expansion of the reproduction right and to leave out acts which are considered to constitute ‘mere use’ of the work such as browsing and navigating on the internet.44 In cases where a mining tool crawls rather than extracts excerpts, minimal or temporary copying 17.52 could be exempted under Article 5(1) of the Information Society Directive and in the light of the Court of Justice’s recent case law (C-360/13 Public Relations Consultants Association Ltd v. Newspaper Licensing Agency Ltd and Others)45 as a technologically necessary part of the ‘crawling’ process.

III. DATABASE DIRECTIVE 1. Copyright The text or other data mined may also involve one or more databases.46 The mining essentially 17.53 refers to the contents of a database but there may be instances where the selection and arrangement of a database may also be copied. Yet, these instances will be rare. This copying is relevant from a copyright point of view if there is some selection or arrangement of data or other materials in the

44

45 46

See C-360/13 Public Relations Consultants Association Ltd v. Newspaper Licensing Agency Ltd and Others, 5 June 2014, ECLI:EU:C:2014:1195 and the discussion in I. Stamatoudi, ‘‘‘Linking”, “Framing” and “Browsing”. The EU Court of Justice’s Recent Case Law’, in Tana Pistorius (ed.), ATRIP Proceedings, 2013 (Edward Elgar Publishing, Cheltenham (UK), Northampton (US), 2016), (in print), according to which when one visits a third party’s website one may browse and view its contents without the need of any authorisation or permission irrespective of the fact that copies are made on his/her computer screen and in the internet ‘cache’ memory of his/her computer’s hard disk since these copies are necessary in order for browsing/viewing to take place in the context of new technologies and in particular of the internet. Ibid. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases, OJ L 077, 27/03/1996 P. 0020 – 0028. By ‘database’ we mean ‘a collection of independent works, data or other materials arranged in a systematic or methodical way and individually accessible by electronic or other means’.

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database at issue and if this selection of arrangement is original, i.e., constitutes the author’s own intellectual creation.47 17.54 More often than not, however, ‘miners’ are interested in contents rather than databases. If a database is protected and constitutes the subject matter of mining, the following acts are precluded (without the rightholder’s authorisation): (a) (b) (c)

(d) (e)

temporary or permanent reproduction by any means and in any form, in whole or in part; translation, adaptation, arrangement and any other alteration; any form of distribution to the public of the database or of copies thereof. The first sale in the Community of a copy of the database by the rightholder or with his consent shall exhaust the right to control resale of that copy within the Community; any communication, display or performance to the public; any reproduction, distribution, communication, display or performance to the public of the results of the acts referred to in (b).48

17.55 From those restricted acts, the ones that seem relevant are (a) reproduction and (b) translation, adaptation, arrangement and any other alteration. 17.56 Translation and adaptation are relevant in the case that the mining tool needs (during the mining process) to shift formats or make (automatic) ‘translations’ or ‘arrangements’ of the contents of the database (and subsequently of the database’s selection or arrangement) in order to ‘read’, ‘mine’ or ‘analyse’ the data included in it. These acts, of course, presuppose reproduction. The copying of the selection or structure of the database is not an aim in itself since the miner does not intend to mine the selection or structure but rather the content of the database. Furthermore, the selection or structure (or elements of them) do not usually survive in the final output of the mining process. 17.57 Yet, there may also be cases where none of these acts take place in the mining process. These are cases where the mining tool ‘dives’ into the contents of the database and ‘crawls’ through them without performing any reproduction or other acts as was explained above in relation to the Information Society Directive. 17.58 The distribution and communication to the public rights do not seem to be relevant as they relate to the final outcome rather than the mining process. In most instances, this outcome will not involve any elements of the selection and arrangement of the database. It is also highly unlikely that one will be in a position to recognise the source of the data appearing in the final outcome of the mining process.

2. Sui generis right 17.59 A right, which seems more relevant for the purposes of text and data mining, is the sui generis right provided in the Database Directive. According to it, if the maker of a database shows that there has been qualitatively and/or quantitatively a substantial investment in either the obtaining, verification or presentation of the contents, it is then afforded a sui generis right, which consists in preventing

47

48

Art. 3(1): ‘In accordance with this Directive, databases which, by reason of the selection or arrangement of their contents, constitute the author’s own intellectual creation shall be protected as such by copyright. No other criteria shall be applied to determine their eligibility for that protection.’ Art. 5.

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the extraction and/or re-utilisation of the whole or of a substantial part, evaluated qualitatively and/or quantitatively, of the contents of that database.49 The sui generis right applies irrespective of whether the database is protected by copyright as well as 17.60 irrespective of whether the contents of the database are protected by some kind of right. Consequently, for the purposes of this discussion, two acts are relevant: extraction and/or 17.61 re-utilisation. These acts are relevant only with regard to the whole or substantial parts of the database.

A. Extraction According to Article 2(a) by ‘extraction’ we mean the permanent or temporary transfer of all or a 17.62 substantial part of the contents of a database to another medium by any means or in any form. This definition has to be construed broadly. According to the British Horseracing case:50

17.63

the use of expressions such as ‘by any means or in any form’ and ‘any form of making available to the public’ indicates that the Community legislature intended to give the concepts of extraction and re-utilisation a wide definition. In the light of the objective pursued by the directive, those terms must therefore be interpreted as referring to any act of appropriating and making available to the public, without the consent of the maker of the database, the results of his investment, thus depriving him of revenue which should have enabled him to redeem the cost of the investment.

During the mining process, the miner extracts material,51 which he then processes in order to reach 17.64 the intended result. These materials are usually transferred to and integrated in another electronic system (and probably ‘translated’) for the purposes of the analysis. In British Horseracing the Court provided that the transfer of data from one medium to another and the integration of it into the latter constitutes an act of extraction. Therefore these acts come within the right of extraction as this has been defined by the CJEU. However, as previously noted, we cannot preclude those cases where technically the analysis is done 17.65 through a crawling process without the need to either extract or translate anything. Even if extraction of a few words or data takes place this extraction may be minimal and may not qualify as a substantial part of the contents of the database.

B. Re-utilisation According to Article 7(2)(b) ‘re-utilisation’ is any form of making available to the public of all or a 17.66 substantial part of the contents of a database by the distribution of copies, renting, online or other forms of transmission. According to British Horseracing this right should be construed broadly as referring to any act of 17.67 appropriating and making available to the public, without the consent of the maker of the database, the results of his investment, thus depriving him of revenue which should have enabled him to redeem the cost of the investment.52

49 50 51 52

Art. 7(1). E. Derclaye, the Database Directive in Stamatoudi and Torremans (eds), EU Copyright Law, note 24, 298. See also Stamatoudi, note 6. C-203/02, The British Horseracing Board Ltd and Others v. William Hill Organization Ltd, 9 November 2004, para. 51. See also para. 65. This is also the reason why the Japanese legislation providing for an exception on text and data mining refers expressly to ‘extraction’. See details above in the relevant section. C-203/02, British Horseracing, para. 51.

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17.68 According to the Football Dataco Ltd case, it should extend ‘to any act, not authorised by the maker of the database protected by the sui generis right, of distribution to the public of the whole or a part of the contents of the database’ including an act where ‘a person sends, by means of his web server, to another person’s computer, at that person’s request, data previously extracted from the content of a database protected by the sui generis right. By such a sending, that data is made available to a member of the public’.53 17.69 Overall we could compare the right of extraction to the reproduction right and the right of re-utilisation to the distribution and communication to the public rights. In this light, we could argue that although extraction is likely to take place on most occasions, this is not the case for re-utilisation. The latter would be relevant to the output of the mining process, which will usually not contain substantial parts of the database.

3. Contractual restrictions 17.70 There may be instances where the database mined is not protected by copyright or by the sui generis right, and contains data that are also not protected by copyright or some other right. In these cases, the use of the database may be restricted on the basis of contractual terms. This was the case in C-30/14 Ryanair Ltd v. PR Aviation BN 54 where the court ruled that if a database is not protected by copyright or the sui generis right, the Database Directive does not apply. The ‘creator’ of such a database may lay down contractual limitations on its use by third parties, without prejudice to the applicable national law. 17.71 From that point of view, it becomes apparent that copyright is not the sole impediment (for those that approach it in this way) to the mining of a database; contract law may well form another or even an additional impediment.

IV. EXCEPTIONS AND LIMITATIONS 17.72 On the basis of the above assumptions text and data mining is very likely to involve acts coming within the scope of the right of reproduction, as referred to in the Information Society Directive, the sui generis right (concerning extraction), as provided in the Database Directive, but is less likely to involve the right of reproduction concerning the selection and arrangement of the materials of a database (i.e., its structure). In this regard, we shall explore whether the current exceptions and limitations to the above rights are capable of accommodating the needs of a miner, as were described in the relevant section. 17.73 The exceptions that seem to be relevant are the exceptions for (a) temporary acts of reproduction, (b) scientific research and (c) normal use of the database.

1. Temporary acts of reproduction 17.74 The Information Society Directive refers to the exception for temporary acts of reproduction. This is the only mandatory exception in it and is thus implemented as such by all EU Member States. According to Article 5(1) certain prerequisites have to be met cumulatively in order for it to apply.

53 54

C-173/11, Football Dataco Ltd and Others v. Sportradar GmbH et Sportradar AG, paras 20 and 21, 18 November 2012. 15 January 2015, ECLI:EU:C:2015:10.

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More specifically an act is exempted from the reproduction right provided that (a) it is temporary; 17.75 (b) it is transient or incidental; (c) it is an integral and essential part of a technological process; (d) its sole purpose is to enable a transmission in a network between third parties by an intermediary or a lawful use of a work or other subject matter to be made, and (e) it has no independent economic significance.55 These conditions have to be met cumulatively and construed narrowly56 since they constitute a derogation from the general rule established by that Directive, i.e., that the copyright holder must authorise any reproduction of his protected work.57

A. Transient or incidental copies forming an essential part of a technological process A ‘transient’ act is an ephemeral act linked to a technological process. According to Public Relations 17.76 Consultants:58 an act will be held to be ‘transient’, in the light of the technological process used, if its duration is limited to what is necessary for that process to work properly, it being understood that that process must be automated inasmuch as it deletes such an act automatically, without human intervention, once its function of enabling the completion of such a process has come to an end.59 Nevertheless, the requirement of automatic deletion does not preclude such a deletion from being preceded by human intervention directed at terminating the use of the technological process. As stated in paragraph 32 above, it is permissible for the technological process at issue in the main proceedings to be activated and completed manually.60

‘Incidental’ are the copies that are not permanent; they are incidental to the main act of exploitation 17.77 and cannot be viewed independently of, nor have a purpose independent of, the technological process in relation to which they have been created.61 According to Infopaq II,62 temporary acts of reproduction should be carried out entirely in the 17.78 context of the implementation of the technological process and in order for that process to function correctly and efficiently. Also, it is not specified at which stage of this process these acts should be carried out nor whether the process should or should not involve any human intervention.63

55 56 57

See para. 22 of Case C-360/13 Public Relations Consultants Association Ltd v. The Newspaper Licensing Agency Ltd, 5 June 2014 ECLI:EU:C:2014:1195. See Infopaq I (C-05/08), para. 56 (16 July 2009) and Infopaq II (C-302/10) para. 26 (17 January 2012). See also C-360/13 ibid. Case C-5/08 Infopaq International, EU:C:2009:465, paras 56 and 57 and Joined Cases C-403/08 and C-429/08 Football Association Premier League and Others, EU:C:2011:631, para. 162. None the less, it is apparent from that same case-law that the exemption provided for in that provision must allow and ensure the development and operation of new technologies, and safeguard a fair balance between the rights and interests of rights holders and of users of protected works who wish to avail themselves of those technologies (see Football Association Premier League and Others, EU:C:2011:631, para. 164).

58 59 60 61 62 63

See paras 23 and 24 of Case C-360/13 Public Relations Consultants. C-360/13 Public Relations Consultants, note 55. Ibid., para. 40. At this stage the CJEU refers to Infopaq International, EU:C:2009:465, para. 64. Ibid., para. 41. Ibid., para. 50. See also Stamatoudi, in Pistorius (ed.), note 44. C-302/10, 17 January 2012. Ibid., paras 30–32.

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B. Transmission in a network between third parties by an intermediary or a lawful use 17.79 The temporary acts of reproduction should be an integral and essential part of a technological process carried out for the sole purpose of enabling either efficient transmission in a network between third parties by an intermediary or a lawful use of a work or other subject matter to be made. By ‘efficient transmission’, it is meant that the acts should enable transmission systems to function efficiently, provided that the intermediary does not modify the information and does not interfere with the lawful use of technology, widely recognised and used by industry, to obtain data on the use of the information. The acts of reproduction concerned should have no separate economic value on their own,64 should not exceed what is necessary for the proper completion of the technological process and should not be used for another purpose.65 17.80 A use is considered lawful where it is authorised by the rightholder or not restricted by law.66

C. No independent economic significance 17.81 The temporary acts should not have independent economic significance, in that the economic advantage derived from their implementation must not be either distinct or separable from the economic advantage derived from the lawful use of the work concerned and it must not generate an additional economic advantage going beyond that derived from that use of the protected work.67 D. Outcome 17.82 If we apply to acts that are relevant to the mining process (i.e., extraction, transformation, loading and analysis) the conditions set out for the exception of temporary copies, as discussed above, the following conclusions can be drawn. 17.83 If we assume that ‘extraction’ takes place in order for the data (mined) to be obtained,68 this extraction does not necessarily involve transient or incidental copies forming part of a technological process. These copies usually last longer (i.e., can be considered permanent in nature) in order for the mining/analysis to take place. We cannot, of course, preclude instances, where these copies are technically made in the cache or RAM memory of a computer and last for a limited period of time. Even if this were the case, still their sole purpose would not be to enable a transmission in a network between third parties by an intermediary. In addition to that, they would form part of a process (the mining or analysis process), which has an independent economic significance and is not linked to another separate main exploitation act. 17.84 As explained above the ‘transform’ act may or may not involve transient or incidental copies. Yet, their sole purpose would not be the transmission in a network between third parties by an intermediary. In any case, since the adaptation right is not harmonised in the Information Society Directive, the same considerations that apply to the ‘extract’ functions also apply to the ‘transform’ functions, since the latter may be considered as involving reproduction. 17.85 The ‘load’ and ‘analysis’ functions also involve reproduction. ‘Loading’ consists in most cases in downloading and storing data in a central repository in order for it to be analysed. This refers to permanent copies, which are under the miner’s control, for which the rightholder’s authorisation is required. We cannot preclude instances where automatic loading and overwriting of data at small intervals occurs. Yet, this does not seem to form the rule. Even if this were the case the transient and 64 65 66 67 68

See also Recital 33 of the Information Society Directive. See Joined Cases C-403/08 and C-429/08, Premier League, para. 172 and C-302/10, Infopaq II, paras 42–43. See Recital 33 of the Information Society Directive. C-302/10, Infopaq II, para. 50 as referred to in Football Association Premier League and Others, para. 175. As we explained above, it is not always necessary that extraction takes place.

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incidental copies would not serve the purpose of transmission over a network. They could perhaps serve the purpose of a lawful use of the work; such use could take place in rare cases only. These could be cases in which the copying of works not protected by copyright took place or the use at issue was allowed by some exception under copyright law or by the rightholder. Also the ‘analysis’ usually consists in the making of multiple copies through various techniques such 17.86 as comparisons, annotations, recognitions of terms, indexing, classification and so on. There may be cases where this copying is made ‘word by word’ with no copies of these words being kept.69 Yet, this seems to form the exception rather than the rule. In all the above stages, it is clear that on most occasions permanent copies are made (at some stage 17.87 of the process) and therefore the exception for temporary copies cannot apply. TDM has an independent economic significance (though the copies relating to each step of it may not) and therefore constitutes a separate exploitation act for which the author’s authorisation is needed. This is also consistent with the three-step test;70 it should not, in my view, be considered a special case,71 as it would conflict with the normal exploitation of the work and would unreasonably prejudice the legitimate interests of the rightholders. I will now examine whether TDM can be exempted on the basis of some other exception.

2. Scientific research The exception for scientific research is provided in Article 5(3)(a) of the Information Society 17.88 Directive and refers to both the right of reproduction72 and the right of communication to the public (including the making available right).73 For the purposes of TDM, it is only the right of reproduction that is relevant. According to Article 5(3)(a), EU Member States may introduce an exception for ‘use for the sole 17.89 purpose of illustration for teaching or scientific research, as long as the source, including the author’s name, is indicated, unless this turns out to be impossible and to the extent justified by the non-commercial purpose to be achieved’. This exception is not mandatory. Yet, most EU countries have introduced it into their national 17.90 laws, not necessarily in a uniform way. This means that there are divergences with regard to its scope of application, i.e., some countries distinguish between teaching and research,74 some provide for particular beneficiaries or users,75 others limit it to particular types of works,76 others link it

69 70 71 72 73 74 75

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De Wolf & Partners et al., note 5, p. 49. Art. 5(5) of Information Society Directive. Such as caching or browsing. Art. 2 of Information Society Directive. Art. 3 of Information Society Directive. See, e.g., Germany, which distinguishes in its law between teaching and research. Yet, the conditions applying to both are very similar. See Art. 53a of the German Act of 9 September 1965 on Copyright and Related Rights. Some Member States restrict the application of the exception to certain beneficiaries only in certain cases only; e.g., in Poland it is only research and educational institutions that benefit from the exception (Art. 27 of the Polish Law No. 83 of 4 February 1994 on Copyright and Neighbouring Rights). An equivalent provision is found in Belgian law (Art. 22, §1, 4quater of the Belgian Law of 30 June 1994 related to Copyright and Neighbouring Rights). In Germany the exception applies for ‘one’s own scientific use’ (Arts 52a and 53 of the German Act of 9 September 1965 on Copyright and Related Rights). France, Germany, Italy, Hungary, Luxembourg and Poland apply this exception in relation to parts or excerpts only of works (See Art. L122-5, 3 e) of the French Intellectual Property Code of 1 July 1992; Arts 52a and 53 of the German Act of 9 September 1965 on Copyright and Related Rights; Art. 70 of the Italian Law No. 633 of 22 April 1941 for the Protection of the Copyright and the Other Related Rights to its Exercise; Art. 34(2) of the Hungarian Act LXXVI of 22 June 1999 on Copyright; Art. 10 of the Luxemburg Law of 18 April 2001 on Copyrights, Neighbouring Rights and

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to specific permitted acts77 and others provide for additional conditions with regard to its application.78 17.91 Since it is not possible for the purposes of this chapter to examine each law separately, we shall examine whether the EU provision on scientific research as it stands, may accommodate the needs of TDM. 17.92 According to it the following conditions should be met. First, the use should be for the sole purpose of (illustration for) scientific research. Secondly, the use should be for non-commercial purposes and thirdly, there should be an acknowledgment of the author’s name (unless this turns out to be impossible). On top of everything, the three-step test also applies. 17.93 It is disputed whether the word ‘illustration’ in the relevant article refers to teaching only or to scientific research, too. The leading view seems to be that the notion of illustration is logically linked to teaching, where one needs to illustrate a work in order to convey his message or the information provided.79 An argument to this end can also be derived from the wording of the equivalent exception found in the Database Directive (Art. 6(2)(b)) where there is no mention of the word ‘illustration’. In any case ‘illustration’ cannot be linked to scientific research, as it seems to be unrelated to its purpose or needs. Research is usually an (in-depth) analysis in a structured manner (methodical and systematic way) in order for one to extract data, knowledge or information in relation to a particular topic. Illustration would not be capable of assisting towards this aim.80 17.94 In most instances, TDM can be considered scientific research. There is an argument that not all research is scientific and therefore in cases where research does not qualify as scientific the exception cannot apply (e.g., research targeted at marketing conditions or marketing behaviour). Yet, this seems to be of limited importance for those cases where the research at issue is non-commercial. It can be argued that if research is conducted by a research institution but aims at being exploited for the economic benefit of the institution, the research at issue will qualify as commercial research and will not be subject to the exception. If a company conducts research for the purposes of mapping consumers’ behaviour (irrespective of whether it qualifies as scientific or not), it is done to serve the purposes of the company. In this case it cannot benefit from the exception. This assumption can also be based on the fact that ‘scientific research’ should form the ‘sole’ or at least the ‘main’ purpose of the mining. If research does not form the ‘sole’ or ‘main’ purpose, the exception does not apply.

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Databases; Art. 27 of the Polish Law No. 83 of 4 February 1994 on Copyright and Neighbouring Rights). Denmark applies it in relation to works of art and works of a descriptive nature for the use in scientific presentation (Art. 23 of the Danish Consolidated Act No. 202 of 27 February 2010 on Copyright). Although this exception applies in almost all countries in relation to the right of reproduction, this is not the case in relation to the right of communication. See de Wolf & Partners et al., note 5, at 57. In some countries exceptions apply only with regard to published works rather than unpublished. See, e.g., the laws of Denmark and the Netherlands. This is a customary application for Germany and Spain. See S. Dusollier, ‘The Limitations and Exceptions to Copyright and Related Rights for Libraries, Research and Teaching Uses’, in J.-P. Triaille (ed.), ‘Study on the Application Of Directive 2001/29/EC on Copyright and Related Rights in the Information Society (The ‘InfoSoc Directive’)’, European Union, October 2013, p. 109, available at http://ec.europa.eu/internal_ market/copyright/docs/studies/131216_study_en.pdf, 253. There are also divergences in the non-commercial requirement (e.g., Luxembourg and Poland do not provide for it. See Art. 10, 2° of the Luxemburg Law of 18 April 2001 on Copyrights, Neighbouring Rights and Databases and Art. 27 of the Polish Law No. 83 of 4 February 1994 on Copyright and Neighbouring Rights respectively). Also not all laws provide for an express acknowledgment of the author’s name. See, e.g, Poland, Art. 27 of the Polish Law No. 83 of 4 February 1994 on Copyright and Neighbouring Rights. EU Member States may also provide for compensation according to Recital 34 of the Information Society Directive. Most EU Member States provide for ‘illustration’ in relation to teaching rather than scientific research. See also the views expressed in Dusollier, in Triaille, ibid., p. 378. See also Walter and von Lewiski, note 43, at 1043.

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Thus, although the conditions of ‘scientific’ and ‘non-commercial’ are distinguishable, they are complementary for the purposes of the exception. Two things should be noted here with regard to TDM. First, not all types of TDM qualify as 17.95 ‘scientific’ research; even those that do will not fall under the relevant exception if they have commercial purposes, i.e., direct or indirect economic or commercial advantage.81 Second, it is not easy to respect the third condition of the exception, i.e., the acknowledgement of the source (including the author’s name). It can be argued that it is not practically feasible82 in the circumstances to indicate the source and the author since it is usually vast amounts of works that are being processed (analysed) during the mining process.83 To this should be added the fact that there are countries that have not implemented the particular provision into their national laws84 as well as others that have implemented it albeit in a varying manner. An exception for scientific research is also found in the Database Directive and concerns the 17.96 reproduction of the structure of the database (i.e., the selection and arrangement of its contents).85 This exception is relevant only if the whole or substantial parts of the database are reproduced; otherwise, the structure of the database cannot be reproduced. According to Article 6(2)(b) Member States shall have the option of providing for a limitation, 17.97 ‘where there is use for the sole purpose of illustration for teaching or scientific research, as long as the source is indicated and to the extent justified by the non-commercial purpose to be achieved’. Not all Member States have implemented this particular exception. Those that did, have (in their majority) provided for all the conditions found in the relevant article. The content of the limitation is almost the same as the one found in the Information Society Directive. There are two differences, though: there is a lack of any mention of ‘illustration’. As we explained above, this may not be considered a difference since we believe that in the case of the Information Society Directive the word ‘illustration’ refers to teaching rather than to scientific research. The second difference lies in the indication of the source. The Information Society Directive requires an acknowledgement of the source; it also includes the author’s name. The author’s name is not mentioned in the Database Directive. Yet, one may assume that even if it is not mentioned, one still needs to refer to it according to the right of paternity, as this right is enshrined in the Berne Convention. It may also be argued that when the drafters of the Directive referred to ‘source’ they also meant ‘author’, since a work primarily originates from its author and secondarily from any other source. As to whether the acknowledgement is a necessary condition, there are two divergent views. 17.98 According to the first view86 there is no difference between the two Directives since it is a general principle of law that law cannot oblige anyone to do anything that is impossible (impossibilium nulla est obligatio). According to the other view the fact that this condition is not mentioned in the

81 82 83

See Art. 1 and Recital 11 of the Rental and Lending Rights Directive and Art. 5(2)(c) and Recital 42 of the Information Society Directive. Although it may be technically possible. Our view is that the ‘impossibility’ is also to be judged on the basis of the objective circumstances at issue, which do not necessarily always refer to the inability of finding or locating the author. According to Walter and von Lewinski, note 43, p. 1044: [t]here may be cases of legal impossibility, in particular, where the author has chosen to stay anonymous and the mentioning of his name, if known to the user, would even violate his moral rights. It may be more difficult to determine when such obligation is in fact (factually) impossible; the Directive does not indicate what efforts must be made to find the author’s name or other indication of source before such indication may be considered impossible.

84 85 86

E.g. Spain, the Netherlands and Greece. It also concerns the communication to the public right but as it is explained above it does not concern the mining process. It may only concern the outcome of this process. Walter and von Lewinski, note 43, p. 1042.

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Database Directive means that the user who does not indicate the source cannot invoke the exception.87 My view is (also in conformity with what the CJEU has provided in its case law in relation to the interpretation of terms found in EU legislation, for which there is no express definition and which according to the Court should be construed in an autonomous and uniform manner throughout the Community)88 that there cannot be a divergence in the meaning of two equivalent provisions89 found in two EU legislative instruments, both concerning copyright law and with the same aim in mind (i.e., the protection of the outcome of their author’s own intellectual creation). These provisions should be interpreted in a uniform manner (as forming part of the same body of EU law) even if such interpretation is conducted by analogy on the basis of elements found in one of the two legislative instruments only. 17.99 In any case, the discussion on whether the exception on scientific research applies to TDM or not is inextricably linked to whether acts of reproduction (during the mining process) take place. As discussed above if it is only ‘crawling’ that takes place and no actual reproduction then there is also no need for any exception to apply. 17.100 An exception for scientific research is also found in Article 9(b) of the Database Directive and concerns the sui generis right. According to it: Member States may stipulate that lawful users of a database which is made available to the public in whatever manner may, without the authorization of its maker, extract or re-utilize a substantial part of its contents […] (b) in the case of extraction for the purposes of illustration for teaching or scientific research, as long as the source is indicated and to the extent justified by the non-commercial purpose to be achieved.

17.101 The conditions for the application of this exception are similar to those provided in relation to copyright databases and the Information Society Directive as explained above. This exception applies to published databases only90 and is optional. This means that Member States do not have to introduce it in their national law. Yet, it seems that a number of countries have implemented it into their laws;91 they all provided for the requirements of the indication of the source and the non-commercial purpose.92 Some of them have also provided for additional requirements.93

87 88

De Wolf & Partners, et al., note 5, at 70. Case C-128/11 UsedSoft GmbH v. Oracle International Corp. ECLI:EU:C:2012:407, para. 39: According to settled case-law, the need for a uniform application of European Union law and the principle of equality require that the terms of a provision of European Union law which makes no express reference to the law of the Member States for the purpose of determining its meaning and scope must normally be given an independent and uniform interpretation throughout the European Union (see, inter alia, Case C-5/08 Infopaq International [2009] ECR I-6569, para. 27; Case C-34/10 Brüstle ECLI:EU:C:2011:669, para. 25; and Case C-510/10 DR and TV2 Danmark ECLI:EU:C:2012:244, para. 33). See also Case C-306/05 SGAE [2006] ECR I-11519 (para. 34) where it is provided that in: ‘interpreting a provision of Community law it is necessary to consider not only its wording, but also the context in which it occurs and the objectives pursued by the rules of which it is part’ and (para. 31): it should be noted that the need for uniform application of Community law and the principle of equality require that where provisions of Community law make no express reference to the law of the Member States for the purpose of determining their meaning and scope, as is the case with Directive 2001/29/EC, they must normally be given an autonomous and uniform interpretation throughout the Community (see, in particular, Case C-357/98 Yiadom [2000] ECR I-9265, para. 26, and Case C-245/00 SENA [2003] ECR I-1251, para. 23)’.

89 90 91 92 93

In the case at issue the two exceptions concern scientific research. ‘[A] database which is made available to the public in whatever manner’. Belgium, Spain, the UK, the Netherlands, France, Germany, Poland, Luxembourg and Hungary, as referred to in De Wolf & Partners, et al., note 5, at 80. Ibid. Ibid., 80–81:

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What needs to be noted here is that this exception applies to ‘extraction’ only and not to 17.102 re-utilisation. It is also somehow broader compared to the two previous exceptions (concerning works and copyright databases) since the word ‘sole’ in relation to the ‘purpose’ (i.e., scientific research) is not included. Thus, it covers ‘extraction’ in relation to mining/analysis, which does not aim solely at scientific research; it may also aim partially at scientific research. The ‘non-commercial’ requirement remains. As to the indication of the source, we can make the following assumptions. Since the sui generis 17.103 right is not linked to authorship, one may derive that it is the maker of the database that should be mentioned. We may also assume94 that the place where the database is found should also be mentioned (namely the publication or the site where it is published).95 Yet, this condition may be very difficult to follow in instances where many databases are used for mining purposes. It cannot be expected from the lawful user to indicate the source for each one of them. Although this seems to be a necessary precondition (for those countries that have implemented it), it may be argued that it cannot always be expected by one to do so, in circumstances where this is impossible (or practically not feasible) according to what was mentioned above; especially in those cases where the extraction is not made public through the dissemination of the research output where the contents of a database are visible. The mining process is usually an internal process, which involves the systems and servers of the data miners. It is also an obligation, which is not dictated by any moral right since it is not linked to authorship. In this regard, it does not seem to serve the exception’s objective in any respect.96 Yet, if the view that this condition should always be respected is followed, this may create substantial practical difficulties in certain cases of TDM.

3. Normal use of a database Another exception to be examined in as much as it applies to TDM, is the normal use of a database, 17.104 as this is provided in Article 6(1) of the Database Directive. According to it: [t]he performance by the lawful user of a database or of a copy thereof of any of the acts listed in Article 5 which is necessary for the purposes of access to the contents of the databases and normal use of the contents by the lawful user shall not require the authorization of the author of the database. Where the lawful user is authorized to use only part of the database, this provision shall apply only to that part.

In Hungary the extraction of data for scientific research is authorized ‘in a manner and to the extent consistent with such purpose’. In Belgium, not only the source, but also ‘the name of the database maker and the title of the database must be mentioned’. In France, the regime is rather restrictive: (i) some databases are excluded from the benefit of the exception (‘to the exclusion of databases created for educational purposes and databases created for a digital written edition), (ii) some uses are excluded (‘to the exclusion of entertainment or recreational activity’), (iii) the beneficiaries are limited (‘so far as the public to whom the extraction and the re-utilization are intended is mainly composed of pupils, students, teachers or researchers directly involved’), and the user must pay a price (‘the use of the extraction […] is compensated by a remuneration negotiated on a lump sum basis’). Furthermore, some countries do not specify that the research must be ‘scientific’ (France and the UK) and in Germany (‘personal scientific use’) and in Poland (‘didactic or research purposes’) the exception for research is not included in the education exception. Finally, the exception for scientific research contained in Article 9(b) of the Database Directive has not been implemented in Italy and in Denmark so far. 94 95 96

Without any of these having been tested before the CJEU or referred to in detail in the EU legislation. According to E. Derclaye, The Legal Protection of Databases: A Comparative Analysis (Edward Elgar, 2008), p. 132, the indication of the source probably refers to the producer. In Football Association Premier League, in the context of Art. 5(1) of the Information Society Directive, the Court emphasised the need to take due account of an exception’s objective and purpose (Joined Cases C-403/08 and C-429/08, Football Association Premier League and Others [2011] ECR I-09083, [162]–[163]). Also the three-step test does not require limitations and exceptions to be interpreted narrowly: ‘All exceptions and limitations are to be interpreted according to their objectives and purposes.’ Cf. Max Planck Institute for Innovation and Competition: A Balanced Interpretation of the ‘Three-Step Test’ in Copyright Law, September 2008, .

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17.105 This is the only mandatory exception found in the Database Directive, which is also unwaivable (i.e., cannot be waived by contract).97 According to it the lawful user of a database can perform any reproduction acts, which are necessary for accessing the contents of a database and for making normal use of them without any additional authorisation by the rightholder. The first issue to be explored is the notion of the ‘lawful user’. According to the explanatory memorandum98 to the Directive the lawful user is the person having acquired the right to use a database. This right (or authorisation) can be based either in law or in contract.99 By law we mean the rights and exceptions provided in the law and by contract we mean any licence, implied or not. By implied licences we include the terms and conditions that one has to accept in order to gain access to online databases.100 17.106 In order for this exception to apply to TDM one has to qualify as the lawful user and the mining should constitute the normal use of the database. All acts relating to it should also be considered necessary for accessing its contents and performing the mining of the data. Unless a database is meant for TDM and the person performing the acts is the lawful user of such database, the exception cannot apply.101 In this light the usefulness of this exception for the purposes of TDM is rather limited.

4. Extraction of ‘insubstantial parts’ from a database protected by the sui generis right 17.107 Another provision, which may be relevant for TDM is the provision that refers to the extraction of insubstantial parts of a database protected by a sui generis right. This ‘right’ is provided in Article 8(1) of the Database Directive. According to it: [t]he maker of a database which is made available to the public in whatever manner may not prevent a lawful user of the database from extracting and/or re-utilizing insubstantial parts of its contents, evaluated qualitatively and/or quantitatively, for any purposes whatsoever. Where the lawful user is authorized to extract and/or re-utilize only part of the database, this paragraph shall apply only to that part.

17.108 Since the sui generis right consists in the prevention of extraction and/or re-utilisation of the whole or of a substantial part, evaluated qualitatively and/or quantitatively, of the contents of the database,102 insubstantial parts can be extracted and/or re-utilised freely. The rightholder cannot prevent the extraction and/or re-utilisation of insubstantial parts by anyone irrespective of whether he is a lawful user or not. If a database is not protected by copyright or a sui generis right one may prevent any use whatsoever of it on the basis of contract law and irrespective of the provisions of the Directive (which is not applicable in the case at issue).103

97 98

99

100

101 102 103

Art. 15 of the Database Directive. Proposal for a Council Directive on the legal protection of databases COM(92)24 final – SYN 393, OJ C 156, 23.6.1992, p. 4 and Amended Proposal for a Council Directive on the legal protection of databases COM(93)464 final – SYN 393, OJ C 308, 15.11.1993, p. 1. Derclaye, note 95, pp. 120 et seq. If an online database is freely available and there are no terms whatsoever attached to its use, then no contract is required. Yet, one may argue that there is an implied licence for free use. Contra, De Wolf & Partners, et al., note 5, at 73. On the basis of this definition the only unlawful users will be those that have stolen or acquired a stolen copy of the database (including those that use an online database on the basis of a stolen or unauthorised password) or those who deal with an infringing copy of it. See Derclaye, note 95, p. 125. According to the author unauthorised use of a database includes instances where one circumvents technological protection measures in order to access the contents of the database. Contra, De Wolf & Partners et al., note 5, at 74. According to para. 34 of the explanatory memorandum, the exception applies only to published databases (it states in the memorandum that it applies to databases which ‘the rightholder has chosen to make available’). Art. 7(1) of the Database Directive. Case C-30/12 Ryanair Ltd v. PR Aviation BN, 15 January 2015.

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The crucial point with regard to this provision is the extraction of ‘insubstantial parts’ for any 17.109 purpose whatsoever (including TDM). The notion of insubstantial parts is not defined in the Directive. Yet, any definition should take into 17.110 consideration quantitative or qualitative criteria. In British Horseracing Board,104 the Court provided that the assessment, in qualitative or quantitative terms, of whether a part is substantial, must refer to the investment in the creation of the database and the prejudice caused to that investment by the act of extracting or re-utilising that part.105 According to the Court, any part, which does not fulfil the definition of a substantial part, evaluated both quantitatively and qualitatively, falls within the definition of an insubstantial part of the contents of a database.106 In other words the notion of ‘substantial’ or ‘insubstantial’ part is linked to the substantial investment made in the database. If the user harms the investment he also infringes the right in the database.107 Additionally, the repeated and systematic extraction (and/or re-utilisation) of insubstantial parts of 17.111 the contents of the database implying acts which conflict with a normal exploitation of that database or which unreasonably prejudice the legitimate interests of the maker of the database are prohibited.108 The conditions of ‘repeated’ and ‘systematic’ acts apply cumulatively,109 whilst ‘acts which conflict with a normal exploitation of [a] database or which unreasonably prejudice the legitimate interests of the maker of the database’ are considered to be acts which reconstitute the whole or a substantial part of the contents of the maker’s database and thus seriously damage the investment made in it.110

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Case C-203/02, The British Horseracing Board Ltd and Others v. William Hill Organization Ltd., 9 November 2004, paras 68 et seq. Ibid., para. 69. The Court also provided that: The expression ‘substantial part, evaluated quantitatively’, of the contents of a database within the meaning of Article 7(1) of the directive refers to the volume of data extracted from the database and/or re-utilized, and must be assessed in relation to the volume of the contents of the whole of that database. If a user extracts and/or re-utilises a quantitatively significant part of the contents of a database whose creation required the deployment of substantial resources, the investment in the extracted or re-utilised part is, proportionately, equally substantial’. (para. 70) And that: The expression ‘substantial part, evaluated qualitatively’, of the contents of a database refers to the scale of the investment in the obtaining, verification or presentation of the contents of the subject of the act of extraction and/or re-utilisation, regardless of whether that subject represents a quantitatively substantial part of the general contents of the protected database. A quantitatively negligible part of the contents of a database may in fact represent, in terms of obtaining, verification or presentation, significant human, technical or financial investment’. (para. 71) See also Recital 42 to the Directive according to which: Whereas the special right to prevent unauthorized extraction and/or re-utilization relates to acts by the user which go beyond his legitimate rights and thereby harm the investment; whereas the right to prohibit extraction and/or re-utilization of all or a substantial part of the contents relates not only to the manufacture of a parasitical competing product but also to any user who, through his acts, causes significant detriment, evaluated qualitatively or quantitatively, to the investment.

106 107 108

Ibid., para. 73. See also Derclaye, note 95, p. 111. See Art. 7(5) of the Database Directive: The repeated and systematic extraction and/or re-utilization of insubstantial parts of the contents of the database implying acts which conflict with a normal exploitation of that database or which unreasonably prejudice the legitimate interests of the maker of the database shall not be permitted.

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Case C-203/02, The British Horseracing Board Ltd and Others v. William Hill Organization Ltd., 9 November 2004, paras 85 et seq. Ibid., para. 89: unauthorised actions for the purpose of reconstituting, through the cumulative effect of acts of extraction, the whole or a substantial part of the contents of a database protected by the sui generis right and/or of making available to the public,

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17.112 Bearing in mind the above, one may extract insubstantial parts of a database for the needs of mining (irrespective of whether one is a lawful user or not) to the extent that such extraction does not end up in reconstituting (reproducing) a substantial part of the database. We believe that reproduction of substantial parts of a database is not needed for the purposes of mining/analysis. Yet, this is an assessment that should be made on a case-by-case basis and does not offer certainty as regards the extent to which one acts legally in relation to mining actions. If access to a database is protected by contract law, which also provides for the prohibition of any acts whatsoever to a particular database, then mining is not possible.

V. TDM IN THE DSM DIRECTIVE 1. The basic rule 17.113 A few decades ago, TDM was not an issue. Nowadays, TDM seems to have been established as a basic means for research.111 It is only normal that the existing legislative framework had not taken this into account and is therefore not tailormade to fit its needs. Most of the time, TDM will involve acts of reproduction (including adaptation and translation) and probably not acts of distribution and communication to the public. The exceptions that are relevant from a copyright point of view (as they are provided in the Information Society and the Database Directives) are (a) the temporary acts of reproduction, (b) scientific research, (c) normal use of a database and (d) the extraction of insubstantial parts of a database. Yet, they all present obstacles to TDM since they can only be assessed on a case-by-case basis given the fact that they have not been made to suit TDM. These obstacles have been explained above.112 17.114 In the light of the above there was a clear uncertainty whether research organisations and cultural heritage institutions could perform acts of TDM.113 17.115 It is in this light that Articles 3 and 4 of the DSM Directive were enacted. At this point the following basic issues concerning Article 3 should be addressed: 17.116 TDM came within the EU’s measures to adapt exceptions and limitations to the digital and cross-border environment.114 That means that it was considered to be highly relevant to acts relating to the performance, promotion and application of EU cross-border scientific research. 17.117 The existing exceptions and limitations in Union law should continue to apply as long as they do not limit the scope of the mandatory exceptions or limitations provided for in the DSM Directive.115

through the cumulative effect of acts of re-utilisation, the whole or a substantial part of the contents of such a database, which thus seriously prejudice the investment made by the maker of the database. 111 112

113

114 115

According to Sergey Filippov, note 22, European academics are falling behind their Asian and North American counterparts. See Recital 5 DSM Directive: ‘In the fields of research, innovation, education and preservation of cultural heritage, digital technologies permit new types of uses that are not clearly covered by the existing Union rules on exceptions and limitations […].’ See also Recitals 8–11. See also Commission Staff Working Document Impact Assessment on the Modernisation of EU copyright rules Brussels, 14.9.2016 SWD(2016) 301 final, at 104–5. For barriers to TDM in Europe see M. Caspers and L. Guilbault, ‘Baseline Report of policies and barriers of TDM in Europe’, Future TDM. Explore, Analyse, Improve, 2016 . See also Recitals 3 and 5. Recital 5.

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TDM was enacted for scientific research only and not as a general all-encompassing tool.

17.118

It was enacted as a mandatory exception (see Art. 7)116 since it was felt that otherwise there would 17.119 be inconsistencies and drawbacks to its EU wide application since different standards would apply to different EU Member States that would impede its application, distort competition and have a negative impact on effective research. TDM works as an exception to four exclusive rights, two of them pertaining to databases (one 17.120 concerning copyright and the other concerning the sui generis right), one of them is the right of reproduction in general as this is enshrined in Article 2 of the Information Society Directive, and the fourth one pertains to Article 15(1) of the DSM Directive concerning online uses of press publications. More specifically, concerning databases protected by copyright: right of reproduction (Art. 5(a) Directive 96/9/EC), concerning databases protected by the sui generis right: the right of extraction and/or re-utilisation of the whole or of a substantial part, evaluated qualitatively and/or quantitatively, of their contents (Art. 7(1) Directive 96/9/EC). The right of reproduction in general for all types of works and the four types of related rights’ 17.121 beneficiaries (i.e., for performers, of fixations of their performances; for phonogram producers, of their phonograms; for the producers of the first fixations of films, in respect of the original and copies of their films; for broadcasting organisations, of fixations of their broadcasts, whether those broadcasts are transmitted by wire or over the air, including by cable or satellite) (Art. 2 Directive 2001/29). The right of reproduction and the making available right for the online use of their press publications 17.122 by information society service providers (Art. 15(1) DSM Directive). TDM acts (i.e., reproductions, extractions and acts of making available to the public117) can be 17.123 performed only by research organisations and cultural heritage institutions for the purposes of scientific research.118 TDM can only be performed to works or other subject matter to which those institutions have 17.124 lawful access: Lawful access should be understood as covering access to content based on an open access policy or through contractual arrangements between rightholders and research organisations or cultural heritage institutions, such as subscriptions, or through other lawful means. For instance, in the case of subscriptions taken by research organisations or cultural heritage institutions, the persons attached thereto and covered by those subscriptions should be deemed to have lawful access. Lawful access should also cover access to content that is freely available online.119

116 117 118 119

Art. 7: ‘Any contractual provision contrary to the exceptions provided for in Articles 3, 5 and 6 shall be unenforceable’. The ‘making available to the public’ in relation to online uses of press publications is not expressly referred to in Art. 3(1); however, it derives from the reference in this paragraph to Art. 15(1) DSM Directive. For the notions of ‘research organisations’, ‘cultural heritage institutions’ and ‘scientific research’ see Art. 2 on definitions. Recital 14.

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The requirement of ‘lawful access’ does not, however, imply that rightholders may contractually rule out text and data mining in their terms of agreement.120 Yet, if a rightholder denies access to one, for example, to his database, one cannot perform TDM despite the mandatory character of the exception.121 17.125 The TDM exception – as all exceptions in the DSM Directive – seeks to achieve a fair balance between authors’ rights and those of users. The three-step test applies to this end (see Recital 6 and Art. 7(2)).122 17.126 The provisions of the Information Society Directive on Technological Protection Measures and their anti-circumvention (i.e., the first, third and fifth subparagraphs of Art. 6(4) of Directive 2001/29/EC) also apply (Art. 7(2)). 17.127 There is no provision for compensation meaning that EU Member States are not free to introduce any compensation, levy or fee in this respect. According to Recital 17: [i]n view of the nature and scope of the exception, which is limited to entities carrying out scientific research, any potential harm created to rightholders through this exception would be minimal. Member States should, therefore, not provide for compensation for rightholders as regards uses under the text and data mining exceptions introduced by this Directive.

2. Storage of copies 17.128 Article 3(2) provides that copies of works or other subject matter made in the context of TDM (as provided in this article) are stored with an appropriate level of security and can be retained for the purposes of scientific research, including for the verification of research results. 17.129 It goes without saying that only research organisations and cultural heritage institutions are entitled to store and retain such copies as they are the only beneficiaries of this exception. This can be done for the purposes of scientific research only, which includes the retention of copies made under the exception for the purposes of carrying out text and data mining as well as subsequent verification of scientific research results.123 17.130 In such cases, the copies should be stored in a secure environment. Member States are free to decide, at national level and after discussions with relevant stakeholders, on further specific arrangements for retaining the copies, including the ability to appoint (third) trusted bodies for the purpose of storing such copies. Such arrangements should be proportionate and limited to what is needed for retaining the copies in a safe manner and preventing unauthorised use so as not to unduly restrict the application of the exception.124

120

121 122 123 124

B. Hugenholtz, ‘The New Copyright Directive: Text and Data Mining (Articles 3 and 4)’, 24 July 2019, Kluwer Copyright Blog . European Copyright Society (2017), General Opinion on the EU Copyright Reform Package, 24 January 2017, p. 4. See Recital 6 that signifies a recent change in the application of the three-step test, which is no longer solely set to protect authors’ rights. Recital 15. Ibid.

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ARTICLE 3: TEXT AND DATA MINING FOR THE PURPOSES OF SCIENTIFIC RESEARCH

Uses for the purpose of scientific research, other than text and data mining, such as scientific peer 17.131 review and joint research, are also covered by the general exception for scientific research, which is provided in the Information Society Directive (Art. 5(3)(a) of Directive 2001/29/EC).125

3. Security and integrity of networks and databases 17.132

According to Recital 16: In view of a potentially high number of access requests to, and downloads of, their works or other subject matter, rightholders should be allowed to apply measures when there is a risk that the security and integrity of their systems [i.e., ‘networks’] or databases [where the works or other subject matter are hosted] could be jeopardised. Such measures could, for example, be used to ensure that only persons having lawful access to their data can access them, including through IP address validation or user authentication. Those measures should remain proportionate to the risks involved, and should not exceed what is necessary to pursue the objective of ensuring the security and integrity of the system and should not undermine the effective application of the exception.126

It is evident that any measures affecting the scope or application of the TDM exception, which, 17.133 however, are necessary for the protection of the rightholders’ interests, should be exercised on the basis of the principle of proportionality, meaning only the extent necessary in order for the purpose at issue to be achieved. If the same purpose can be achieved with more restrictive means, the more restrictive means will apply.127

4. Best practices The text of Article 3 provides that Member States should encourage involved parties, i.e., 17.134 rightholders, research organisations and cultural heritage institutions, to define commonly agreed best practices concerning the storage and retention of copies as well as the security and integrity of networks and databases (i.e., paras 2 and 3 respectively). Cooperation between stakeholders and the establishment of best practices is an ideal solution, which prevents disputes and inconsistencies in the way things are done and objectives are pursued. Yet, this remains wishful thinking since if parties cannot reach a mutually accessible solution the acts above (i.e., storage and retention of copies as well as the application of measures by rightholders for protecting the security and integrity of their networks and databases) can still be applied unilaterally respecting though the prerequisites of law and in particular the principle of proportionality.

125

Art. 5(3)(a) of Directive 2001/29/EC provides: Member States may provide for exceptions or limitations to the rights provided for in Articles 2 and 3 in the following cases: (a) use for the sole purpose of illustration for teaching or scientific research, as long as the source, including the author’s name, is indicated, unless this turns out to be impossible and to the extent justified by the non-commercial purpose to be achieved.

126 127

The text in square brackets is the author’s. A parallel is made between these provisions and the safeguards put in place in the context of ‘traffic management’ by telecom operators. According to the Telecoms Single Market Regulation, ‘traffic management measures’ can be applied only in order to comply with EU law and public authorities bound by EU law, preserve the integrity and security of the network, and prevent or mitigate network congestion. Regulation (EU) 2015/2120 of the European Parliament and of the Council of 25 November 2015 laying down measures concerning open internet access and amending Directive 2002/22/EC on universal service and users’ rights relating to electronic communications networks and services and Regulation (EU) No 531/2012 on roaming on public mobile communications networks within the Union, 2015 OJ (L 310) 1–18, Art. 3(3) (a–c). Chr. Geiger, G. Frosio and O. Bulayenko, ‘Text and Data Mining: Articles 3 and 4 of the Directive 2019/790/EU’, Centre for International Intellectual Property Studies Research Paper No. 2019-08, at 34–5. Electronic copy available at: https://ssrn.com/abstract=3470653.

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NOTES 1. Related instruments Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/10. Regulation (EU) 2015/2120 of the European Parliament and of the Council of 25 November 2015 laying down measures concerning open internet access and amending Directive 2002/22/EC on universal service and users’ rights relating to electronic communications networks and services and Regulation (EU) No 531/2012 on roaming on public mobile communications networks within the Union, [2015] OJ L 310/1. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases [1996] OJ L77/20. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, A Digital Single Market Strategy for Europe, Brussels, 6.5.2015 COM (2015) 192 final. Commission Staff Working Document, A Digital Single Market Strategy for Europe – Analysis and Evidence (Brussels, 6.5.2015 SWD(2015) 100 final), Accompanying the document Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, A Digital Single Market Strategy for Europe and the Roadmap for completing the Digital Single Market http://ec.europa.eu/priorities/digital-single-market/.

2. CJEU case law Case C-357/98 Yiadom [2000] ECR I-9265. Case C-245/00 SENA ][2003 ECR I-1251. Case C-306/05 SGAE [2006] ECR I -11519. Case C-203/02 The British Horseracing Board Ltd and Others v William Hill Organization Ltd ECLI:EU:C:2004:695. Case C-5/08 Infopaq International EU:C:2009:465. Joined Cases C-403/08 and C-429/08 Football Association Premier League and Others [2011] ECR I-09083, EU:C:2011:631. Case C-34/10 Brüstle ECLI:EU:C:2011:669. Case C-302/10 Infopaq International II ECLI:EU:C:2012:16. Case C-510/10 DR and TV2 Danmark ECLI:EU:C:2012:244. Case C-128/11 UsedSoft GmbH v Oracle International Corp ECLI:EU:C:2012:407. Case C-173/11 Football Dataco Ltd and Others v Sportradar GmbH et Sportradar AG ECLI:EU:C:2012:642. Case C-360/13 Public Relations Consultants Association Ltd v Newspaper Licensing Agency Ltd and Others ECLI:EU:C:2014:1195. Case C-30/14 Ryanair Ltd v PR Aviation BN ECLI:EU:C:2015:10.

3. Bibliography Brook, M., Murray-Rust, P. and Oppenheim, C., ‘The Social, Political and Legal Aspects of Text and Data Mining (TDM)’ (2014) 20(11/12) D-Lib Magazine. Dietrich, N., Guibault, L., Margoni, T., Siewicz, K., Spindler, G., and Wiebe, A. (2013), Safe to Be Open: Study on the Protection of Research Data and Recommendations for Access and Usage, Göttingen, Germany: Universitätsverlag Göttingen. Ducato, R. and Strowel, A., ‘Limitations to Text and Data Mining and Consumer Empowerment: Making the Case for a Right to “Machine Legibility” (2019) 50(6) IIC 649. EUA, CESAER, LERU and Liber (2017), ‘Future-proofing European Research Excellence: A Statement from European Research Organisations on Copyright in the Digital Single Market’, 10 January 2017, pp. 1–2. European Commission, The European Data Market Study: Final Report (Brussels, European Commission, February 2017). European Copyright Society (2017), General Opinion on the EU Copyright Reform Package, 24 January 2017. Geiger, C. and Schönherr, F. (2012), ‘Defining the Scope of Protection of Copyright in the EU: The Need to Reconsider the Acquis regarding Limitations and Exceptions’, in Synodinou, T.-E. (ed.), Codification of European Copyright Law, Challenges and Perspectives, Amsterdam, Netherlands: Kluwer Law International.

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ARTICLE 3: TEXT AND DATA MINING FOR THE PURPOSES OF SCIENTIFIC RESEARCH Geiger, C. and Schönherr, F. (2014), ‘Limitations to Copyright in the Digital Age’, in Savin, A. and Trzaskowski, J. (eds), Research Handbook on EU Internet Law, Cheltenham, UK: Edward Elgar, p. 110. Geiger, C., Frosio, G. and Bulayenko, O. (2017), ‘CEIPI Opinion on the European Commission’s Proposal to Reform Copyright Limitations and Exceptions in the European Union’, CEIPI Research Paper No. 2017-9. Geiger, C., Frosio, G. and Bulayenko, O., ‘The EU Commission’s Proposal to Reform Copyright Limitations: A Good but Far Too Timid Step in the Right Direction’ (21018) 40(1) EIPR 154. Geiger, C., Gervais, D. and Senftleben, M., ‘The Three Step Test Revisited: How to Use the Test’s Flexibility in National Copyright Law’ (2014) 29(3) American University International Law Review 581. Geiger, C., Griffiths, J. and Hilty, R., ‘Towards a Balanced Interpretation of the ‘Three-Step Test’ in Copyright Law’ (2008) 4 EIPR 489–96. Geiger, Chr., Frosio G. and Bulayenko O., ‘Text and Data Mining: Articles 3 and 4 of the Directive 2019/790/EU’, Centre for International Intellectual Property Studies Research Paper No. 2019-08 . Griffiths, J., Geiger, C., Senftleben, M., Xalabarder, R. and Bently, L., ‘Limitations and Exceptions as Key Elements of the Legal Framework for Copyright in the European Union – Opinion on the Judgment of the CJEU in Case C-201/13 Deckmyn ’ (2015) 45(1) EIPR 93. Guadamuz, A. and D. Campbell, ‘Data Mining in UK Higher Education Institutions: Law and Policy’ (2014) 4(1) Queen Mary Journal of Intellectual Property 3–29. Guibault, L. (2002), Copyright Limitations and Contracts: An Analysis of the Contractual Overridability of Limitations on Copyright, The Hague, Netherlands: Kluwer Law International. Guibault, L. et al. (2007), Study on the Implementation and Effect in Member States’ Laws of Directive 2001/29/EC on the Harmonisation of Certain Aspects of Copyright and Related Rights in the Information Society, report prepared for the European Commission, DG Internal Market, ETD/2005/IM/D1/91. Handke, C., Guibault, L. and Vallbé, J. (2015), ‘Is Europe Falling Behind in Data Mining? Copyright’s Impact on Data Mining in Academic Research’, in Schmidt, B. and Dobreva, M. (eds), New Avenues for Electronic Publishing in the Age of Infinite Collections and Citizen Science: Scale, Openness and Trust, Amsterdam, Netherlands: IOS Press, p. 120. Hilty, R. (2018), ‘Big Data: Ownership and Use in the Digital Age’ in Seuba, X., Geiger, C. and Pénin, J. (eds), Intellectual Property and Digital Trade in the Age of Artificial Intelligence and Big Data, CEIPI/ ICTSD publication series on Global Perspectives and Challenges for the Intellectual Property System, Issue No. 5, Geneva/Strasbourg, December 2018, p. 85. Hilty, R. and Moscon, V. (eds) (2017), Modernisation of the EU Copyright Rules, Position Statement of the Max Planck Institute for Innovation and Competition, Max Planck Institute for Innovation and Competition Research Paper No. 17-12. Hugenholtz B., ‘The New Copyright Directive: Text and Data Mining (Articles 3 and 4)’, 24 July 2019, Kluwer Copyright Blog http://copyrightblog.kluweriplaw.com/2019/07/24/the-new-copyright-directive-text-and-datamining-articles-3-and-4/?doing_wp_cron=1591175128.1284079551696777343750. IFLA (2013), Statement on Text and Data Mining, p. 2. Margoni, T. and Dore, G. (2016), ‘Why We Need a Text and Data Mining Exception (But It Is Not Enough)’, 1 April 2016. Available at: https://zenodo.org/record/248048#.WXdf2oiGNEY. McDonald, D. and Kelly U. (2012), ‘The Value and Benefit of Text Mining to UK Further and Higher Education. Digital Infrastructure’, JISC. Available at: http://bit.ly/jisc-textm. Ménière, Y. and Rudyk, I. (2018), ‘The Fourth Industrial Revolution from the Perspective of the EPO’, in Seuba, X., Geiger, C. and Pénin, J. (eds), Intellectual Property and Digital Trade in the Age of Artificial Intelligence and Big Data, CEIPI/ICTSD publication series on Global Perspectives and Challenges for the Intellectual Property System, Issue No. 5, Geneva/Strasbourg, December 2018, p. 85. Murray-Rust, P., Molloy, J. and Cabell, D. (2014), ‘Open Content Mining’, in Moore, S.A. (ed.), Issues in Open Research Data, London, UK: Ubiquity Press, p. 28. Quintais, J. P., ‘Rethinking Normal Exploitation: Enabling Online Limitations in EU Copyright Law’ (2017) 6 AMI 197–205. Samuelson P., ‘The EU’s Controversial Digital Single Market Directive – Part II: Why the Proposed Mandatory Text- and Data-Mining Exception Is Too Restrictive’, 12 July 2018, Kluwer Copyright Blog http:// copyrightblog.kluweriplaw.com/2018/07/12/eus-controversial-digital-single-market-directive-part-ii-proposedmandatory-text-data-mining-exception-restrictive/?doing_wp_cron=1591177637.4914610385894775390625. Stamatoudi I. (2016), ‘Text and Data Mining’, in I. Stamatoudi (ed.), New Developments in EU and International Copyright Law, Information Law Series (B. Hugenholtz (general editor)), Wolters Kluwer, 251.

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Chapter 17 THE DIGITAL SINGLE MARKET DIRECTIVE Triaille, J.P., de Meeûs d’Argenteuil, J. and De Francquen, A. (2014), Study of the Legal Framework of Text and Data Mining (TDM), prepared for the European Commission, p. 28. Weiss, S., Indurkhya, N. and Zhang, T. (2010), Fundamentals of Predictive Text Mining, Texts in Computer Sciences, Amsterdam, Netherlands: Springer. Wu, X., Zhu, X., Wu, G. and Ding, W., ‘Data Mining with Big Data’ (2014) 26 IEEE Transactions on Knowledge and Data Engineering 97.

ARTICLE 4: EXCEPTION OR LIMITATION FOR TEXT AND DATA MINING 1.

2. 3.

4.

Member States shall provide for an exception or limitation to the rights provided for in Article 5(a) and Article 7(1) of Directive 96/9/EC, Article 2 of Directive 2001/29/EC, Article 4(1)(a) and (b) of Directive 2009/24/EC and Article 15(1) of this Directive for reproductions and extractions of lawfully accessible works and other subject matter for the purposes of text and data mining. Reproductions and extractions made pursuant to paragraph 1 may be retained for as long as is necessary for the purposes of text and data mining. The exception or limitation provided for in paragraph 1 shall apply on condition that the use of works and other subject matter referred to in that paragraph has not been expressly reserved by their rightholders in an appropriate manner, such as machine-readable means in the case of content made publicly available online. This Article shall not affect the application of Article 3 of this Directive.

I. COMMENTARY 1. Basic characteristics of the right 17.135 TDM – as explained in Article 3 – has become a large important research tool in our days cutting across a variety of domains in life or science ranging from linguistics and astronomy to musicology and the arts. It is closely linked to almost any type of computer-based analysis of large bodies of data in order to gain knowledge128 and it is relevant for Artificial Intelligence projects such as the Next Rembrandt painting, which was the outcome of machine learning and the processing of millions of data.129 17.136 Article 3 is relevant for research institutions and cultural heritage organisations. TDM in this case (Art. 3) can only be conducted for the purposes of scientific research. It is a limited exception and for that reason it is also mandatory. It cannot be contracted out of. Yet, in the real world there are several other types of research and several types of people or entities that may engage in TDM. It is widely used both by private and public entities for various purposes, including for government services, complex business decisions and the development of new applications or technologies.130 To the extent that these institutions are not research institutions or cultural heritage organisations acting for purposes of scientific research, they are excluded from the scope of Article 3. So are public broadcasting organisations and commercial research institutes. 17.137 Article 4 permits TDM for any kind of purposes irrespective of whether or not it is for commercial gain. Article 4 is there to cope with the:

128 129 130

Hugenholtz, note 120. https://www.nextrembrandt.com/. Recital 18.

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ARTICLE 4: EXCEPTION OR LIMITATION FOR TEXT AND DATA MINING legal uncertainty as to whether reproductions and extractions made for the purposes of TDM can be carried out on lawfully accessed works or other subject matter, in particular when the reproductions or extractions made for the purposes of the technical process do not fulfil all the conditions of the existing exception for temporary acts of reproduction […] (Art. 5(1) of Directive 2001/29/EC).

This provision encourages innovation both in the public and private sector and sets out the conditions under which it applies. Article 4 can be implemented into the national laws of the EU Member States either as an 17.138 exception or as a limitation. According to paragraph 34 of Joined Cases C-457/11 to C-460/11131 – referring to the exclusive right of reproduction: […] that exclusive right may, depending on the circumstances, be either, as an exception, totally excluded, or merely limited. It is conceivable that such a limitation may include, depending on the particular situations that it governs, in part an exclusion, a restriction, or even the retention of that right.

In the same sense Article 4 may be implemented by EU Member States either as an exception or as a limitation in contrast with Article 3 that clearly forms an exception. 17.139

Article 4 is subject to the following conditions:

TDM applies as an exception or limitation to the same acts as those provided in Article 3 plus 17.140 Article 4(1)(a)(b) of the Software Directive (i.e., rights of reproduction and rights of translation, adaptation, arrangement and any other alteration of a computer program and the reproduction of the results thereof).132 TDM is neither linked to particular institutions or organisations or to scientific research. It can be 17.141 conducted by anyone for any purpose whatsoever. Rightholders remain able to license the uses of their works or other subject matter falling outside the 17.142 scope of the mandatory exception of Article 3 and of the exceptions and limitations provided in the Information Society Directive. TDM (Art. 4) only applies where the work or other subject matter (a) is accessed lawfully by the 17.143 beneficiary, including when it has been made available to the public online, and (b) insofar as the rightholders have not reserved in an appropriate manner the rights to make reproductions and extractions for TDM. TDM rights (Art. 4) may be reserved by their rightholders in an appropriate manner, such as 17.144 machine-readable means in the case of content made publicly available online (Art. 4(3)) ‘by the use

131

132

Judgment of the Court (Fourth Chamber), 27 June 2013, Joined Cases C-457/11 to C-460/11 Verwertungsgesellschaft Wort (VG Wort) v. Kyocera, formerly Kyocera Mita Deutschland GmbH, Epson Deutschland GmbH, Xerox GmbH (C-457/11), Canon Deutschland GmbH (C-458/11), and Fujitsu Technology Solutions GmbH (C-459/11), HewlettPackard GmbH (C-460/11), v. Verwertungsgesellschaft Wort (VG Wort) ECLI:EU:C:2013:426. Art. 4 provides: Subject to the provisions of Articles 5 and 6, the exclusive rights of the rightholder within the meaning of Article 2 shall include the right to do or to authorise: (a) the permanent or temporary reproduction of a computer program by any means and in any form, in part or in whole; in so far as loading, displaying, running, transmission or storage of the computer program necessitate such reproduction, such acts shall be subject to authorisation by the rightholder; (b) the translation, adaptation, arrangement and any other alteration of a computer program and the reproduction of the results thereof, without prejudice to the rights of the person who alters the program.

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of machine-readable means, including metadata and terms and conditions of a website or a service. […] In other cases, it can be appropriate to reserve the rights by other means, such as contractual agreements or a unilateral declaration’ (Recital 18). 17.145 In light of the above rightholders are free to opt out from this limitation since according to Article 4(3) it applies only on condition that right holders have not expressly reserved the rights. 17.146 Other uses (apart from TDM) should not be affected by the reservation of rights for the purposes of text and data mining. Also, Article 4 does not affect the application of Article 3 (which is a mandatory provision and therefore it is not subject to contractual, licensing or other arrangements) (Art. 4(4)).

2. Storage of copies 17.147 Article 4(2) does not reproduce the wording of Article 3(2) concerning the storage and retention of copies. In fact, it provides that ‘[r]eproductions and extractions (made pursuant to para. 1) may be retained for as long as is necessary for the purposes of text and data mining. 17.148 Our view is that nothing changes in comparison to what is provided in Article 3. Yet, one has to bear in mind that Article 3 is a mandatory provision whilst one can contract out of Article 4 or can provide for the terms of retention of copies on the basis of a licence. In any case – although not expressly mentioned – storage and retention are allowed for as long as is necessary for the purposes of TDM. The principle of proportionality is therefore mentioned only in terms of duration and not in terms of a general scope.

3. Three-step test and technological protection measures 17.149 According to Article 7(2) of the DSM Directive, the three-step test applies to both TDM exceptions. Technological protection measures (TPMs) and anti-circumvention provisions (as provided in the first, third and fifth subparas of Art. 6(4) of Directive 2001/29/EC) also apply to both exceptions. 17.150 As has been noted, although ‘Article 6(4) creates an obligation to provide the means to exercise a limitation, this obligation is imposed on rights owners and does not give users any authority to perform act of circumvention themselves.’133 To this it should be added the fact that ‘inconsistent implementations across national jurisdictions of measures to guarantee the application of exceptions and limitations against TPMs’ anti-circumvention provisions might effectively curtail harmonised enjoyment of the new mandatory exceptions, thus limiting DSM effectiveness’.134

NOTES 1.

CJEU case law

Joined Cases C-457/11 to C-460/11 Verwertungsgesellschaft Wort (VG Wort) v Kyocera, formerly Kyocera Mita Deutschland GmbH, Epson Deutschland GmbH, Xerox GmbH (C-457/11), Canon Deutschland GmbH (C-458/11),

133

134

Guibault, L. et al. (2007), Study on the Implementation and Effect in Member States’ Laws of Directive 2001/29/EC on the Harmonisation of Certain Aspects of Copyright and Related Rights in the Information Society, report prepared for the European Commission, DG Internal Market, ETD/2005/IM/D1/91. Chr. Geiger, G. Frosio and O. Bulayenko, ‘Text and Data Mining: Articles 3 and 4 of the Directive 2019/790/EU’, Centre for International Intellectual Property Studies Research Paper No. 2019-08, at 35–6. Electronic copy available at: https://ssrn.com/abstract=3470653.

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ARTICLE 5: USE OF WORKS AND OTHER SUBJECT MATTER and Fujitsu Technology Solutions GmbH (C-459/11), Hewlett-Packard GmbH (C-460/11), v Verwertungsgesellschaft Wort (VG Wort) ECLI:EU:C:2013:426.

2. Bibliography Geiger, Chr., Frosio G. and Bulayenko O., ‘Text and Data Mining: Articles 3 and 4 of the Directive 2019/790/EU’, Centre for International Intellectual Property Studies Research Paper No. 2019-08, Electronic copy available at: https://ssrn.com/abstract=3470653. Guibault, L. et al. (2007), Study on the Implementation and Effect in Member States’ Laws of Directive 2001/29/EC on the Harmonisation of Certain Aspects of Copyright and Related Rights in the Information Society, report prepared for the European Commission, DG Internal Market, ETD/2005/IM/D1/91. Hugenholtz B., ‘The New Copyright Directive: Text and Data Mining (Articles 3 and 4)’, 24 July 2019, Kluwer Copyright Blog http://copyrightblog.kluweriplaw.com/2019/07/24/the-new-copyright-directive-text-and-datamining-articles-3-and-4/?doing_wp_cron=1591175128.1284079551696777343750.

ARTICLE 5: USE OF WORKS AND OTHER SUBJECT MATTER IN DIGITAL AND CROSS-BORDER TEACHING ACTIVITIES 1.

2.

3.

4.

Member States shall provide for an exception or limitation to the rights provided for in Article 5(a), (b), (d) and (e) and Article 7(1) of Directive 96/9/EC, Articles 2 and 3 of Directive 2001/29/EC, Article 4(1) of Directive 2009/24/EC and Article 15(1) of this Directive in order to allow the digital use of works and other subject matter for the sole purpose of illustration for teaching, to the extent justified by the non-commercial purpose to be achieved, on condition that such use: (a) takes place under the responsibility of an educational establishment, on its premises or at other venues, or through a secure electronic environment accessible only by the educational establishment’s pupils or students and teaching staff; and (b) is accompanied by the indication of the source, including the author’s name, unless this turns out to be impossible. Notwithstanding Article 7(1), Member States may provide that the exception or limitation adopted pursuant to paragraph 1 does not apply or does not apply as regards specific uses or types of works or other subject matter, such as material that is primarily intended for the educational market or sheet music, to the extent that suitable licences authorising the acts referred to in paragraph 1 of this Article and covering the needs and specificities of educational establishments are easily available on the market. Member States that decide to avail of the first subparagraph of this paragraph shall take the necessary measures to ensure that the licences authorising the acts referred to in paragraph 1 of this Article are available and visible in an appropriate manner for educational establishments. The use of works and other subject matter for the sole purpose of illustration for teaching through secure electronic environments undertaken in compliance with the provisions of national law adopted pursuant to this Article shall be deemed to occur solely in the Member State where the educational establishment is established. Member States may provide for fair compensation for rightholders for the use of their works or other subject matter pursuant to paragraph 1.

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I. COMMENTARY 17.151 EU copyright law already provides for exceptions and limitations for the purpose of illustration for teaching. Recital 19135 refers in this respect to Article 5(3)(a) of Directive 2001/29/EC that allows Member States to introduce an exception or limitation to the rights of reproduction, communication to the public and making available to the public of works or other subject matter in such a way that members of the public may access them from a place and a time individually chosen by them, for the sole purpose of illustration for teaching and to Articles 6(2)(b) and 9(b) of Directive 96/9/EC that permit the use of a database and the extraction of a substantial part of its contents. But the scope of these exceptions is unclear when it comes to digital uses. Would these exceptions and limitations apply where teaching is provided online and at a distance and do they have a cross-border potential? That raises a real problem in a modern digital education environment. Article 5 tries to address this issue through the introduction of a new mandatory exception or limitation that ensures that educational establishments benefit from full legal certainty when using works or other subject matter in digital teaching activities, including online and across borders. Any use needs to be for the sole purpose of illustration for teaching and it needs to be justified by the non-commercial purpose that is to be achieved. The exception or limitation should, therefore, benefit all educational establishments recognised by a Member State, including those involved in primary, secondary, vocational and higher education, but the organisational structure and the means of funding of an educational establishment should not be the decisive factors in determining whether the activity is non-commercial in nature. The non-commercial purpose is to be found in the provision of education.136 It needs to be proportional to the educational need for such an illustration and the benefit to students. A commercial purpose that is ruled out would for example offer a copyright protected work to students as a replacement of a commercial purchase on their own, as a free ‘present’ and irrespective of the pedagogical and educational need for such a use of the work.137 17.152 Recital 21 further illustrated the scope of the exception or limitation as follows: The exception or limitation provided for in this Directive for the sole purpose of illustration for teaching should be understood as covering digital uses of works or other subject matter to support, enrich or complement the teaching, including learning activities. The distribution of software allowed under that exception or limitation should be limited to digital transmission of software. In most cases, the concept of illustration would, therefore, imply the use only of parts or extracts of works, which should not substitute for the purchase of materials primarily intended for the educational market. When implementing the exception or limitation, Member States should remain free to specify, for the different types of works or other subject matter, in a balanced manner, the proportion of a work or other subject matter that can be used for the sole purpose of illustration for teaching. Uses allowed under the exception or limitation should be understood to cover the specific accessibility needs of persons with a disability in the context of illustration for teaching.138

17.153 The mandatory exception or limitation that Member States are obliged to put in place139 covers Article 5(a), (b), (d) and (e) and Article 7(1) of Directive 96/9/EC, i.e., the sui generis rights and all the exclusive rights, minus the distribution right, of the Database Directive,140 Articles 2 and 3 of Directive 2001/29/EC, i.e., the reproduction right and the right of communication to the

135 136

137 138 139 140

Recital 19 to Directive 2019/790. B. J. Jütte, ‘The New Copyright Directive: Digital and Cross-border Teaching Exception (Article 5)’, Kluwer Copyright Blog, http://copyrightblog.kluweriplaw.com/2019/06/21/the-new-copyright-directive-digital-and-crossborder-teaching-exception-article-5/?doing_wp_cron=1590832612.0396690368652343750000. Directive 2019/790, Recital 20. Ibid., Recital 21. Art. 7 DSM Directive. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases [1996] OJ L 77/20.

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public,141 Article 4(1) of Directive 2009/24/EC, i.e., the reproduction right in the Software Directive,142 and Article 15(1) of the DSM Directive, i.e., the press publishers’ right.143 The exception or limitation and the use it covers come accompanied by two conditions. On the one 17.154 hand there is the condition that the use takes place under the responsibility of an educational establishment, on its premises or at other venues, or through a secure electronic environment accessible only by the educational establishment’s pupils or students and teaching staff. The logical focus lies on the fact that the use needs to take place under the responsibility of the educational establishment, but apart from that the definition is rather wide in scope. The use can, obviously, take place on the premises of the educational establishment, but also at other venues or through a network that is accessible to students and teaching staff. On each occasion the real limitation is that the use needs to be proportional, i.e., it should only go as far as what is required to illustrate the teaching activity. But Recital 22 gives a clear hint that this will indeed cover all the present educational needs: The exception or limitation should cover both uses of works or other subject matter made in the classroom or in other venues through digital means, for example electronic whiteboards or digital devices which might be connected to the internet, as well as uses made at a distance through secure electronic environments, such as in the context of online courses or access to teaching material complementing a given course. Secure electronic environments should be understood as digital teaching and learning environments access to which is limited to an educational establishment’s teaching staff and to pupils or students enrolled in a study programme, in particular through appropriate authentication procedures including password-based authentication.144

On the other hand, there is the condition that the use should be accompanied by the indication of 17.155 the source, including the author’s name, unless this is impossible, e.g., because these data are unknown or because there are too many of them when a multitude of (very) small pieces are used. Paragraph (2) is the controversial bit of Article 5. It allows Member States to replace the exception 17.156 or limitation with a licensing scheme that covers the needs and specificities of the educational establishments if licences under such a scheme are easily available on the market. What the legislator has in mind are licensing schemes and licences covering specific uses or types of works or other subject matter and it gives the example of material that is primarily intended for the educational market or sheet music. Certain Member States have such schemes in place and there was clearly no political will, let alone agreement, to drop these. Instead Member States are given the alternative to expand these schemes to cover the needs of Article 5, at least partially. The remaining uses or subject matter would remain covered by the exception or limitation.145 That mixed picture can give rise to uncertainty and Member States adopting such an approach 17.157 should therefore take concrete measures to ensure that licensing schemes allowing digital uses of works or other subject matter for the purpose of illustration for teaching are easily available, and that educational establishments are aware of the existence of such licensing schemes. The guiding principle is that such licensing schemes should meet the needs of educational establishments. The licences should be easily available, but if these easily available licences need to meet the educational

141 142 143 144 145

Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/10. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs (Codified version) [2009] OJ L 111/16. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC [2019] OJ L 130/92. Recital 22 to Directive 2019/790, in fine. Recital 23 to Directive 2019/790.

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establishments’ needs, they will need to be reasonably priced, thus allaying fears that market conditions will make them unaffordable. There is after all a risk that the involvement of the market and the hybrid system will make the intended benefit of Article 5 unattainable on quite a number of occasions. In order to guarantee legal certainty, Member States should specify under which conditions an educational establishment can use protected works or other subject matter under that exception and, conversely, when it should act under a licensing scheme.146 It is on the other hand clear that the licensing option makes sense for publishers that are active on the educational market.147 17.158 There is also a problem of private international law here. Use under the exception or limitation on a network is likely to cross borders, but in each Member State the exception and limitation will be (slightly) different. Under the provisions of the Rome II Regulation,148 that would result in the country by country and Member State by Member State application of the local exception of limitation and this would become very complex and cumbersome. Paragraph (3)149 therefore avoids that problem by locating all use in the Member State where the educational establishment is established. That will result in the application of, and for the educational establishment the benefit of, a single limitation and exception under the national law of that Member State.150 17.159 Member States remain free to provide that rightholders receive fair compensation for the digital uses of their works or other subject matter under the exception or limitation for illustration for teaching, but they are not obliged to put a fair compensation system in place. Member States have different traditions in this respect, but on each occasion the requirement of fairness will require a balance between the educational objective and the harm to rightholders, as well as a system that does not create an administrative burden for educational establishments, as that would de facto seriously reduce the benefit they are entitled to expect from the exception or limitation.151

NOTES 1. Related instruments Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases [1996] OJ L 77/20. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/10. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs (Codified version) [2009] OJ L 111/16. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC [2019] OJ L 130/92. Regulation (EC) No 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law applicable to non-contractual obligations (Rome II) [2007] OJ L 199/40.

2. Bibliography de Miguel Asensio, P., Conflict of Laws and the Internet (Edward Elgar Publishing, 2020).

146 147 148 149 150 151

Ibid. Jütte, note 136. Regulation (EC) No 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law applicable to non-contractual obligations (Rome II) [2007] OJ L 199/40. Art. 5(3) of Directive 2019/790. P. de Miguel Asensio, Conflict of Laws and the Internet (Edward Elgar Publishing, 2020), at para. 4.137. Art. 5(4) of the DSM Directive and Recital 24 to the Directive.

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ARTICLE 6: PRESERVATION OF CULTURAL HERITAGE Jütte, B. J., ‘The New Copyright Directive: Digital and Cross-border Teaching Exception (Article 5)’, Kluwer Copyright Blog, http://copyrightblog.kluweriplaw.com/2019/06/21/the-new-copyright-directive-digital-andcross-border-teaching-exception-article-5/?doing_wp_cron=1590832612.0396690368652343750000.

ARTICLE 6: PRESERVATION OF CULTURAL HERITAGE Member States shall provide for an exception to the rights provided for in Article 5(a) and Article 7(1) of Directive 96/9/EC, Article 2 of Directive 2001/29/EC, Article 4(1)(a) of Directive 2009/24/EC and Article 15(1) of this Directive, in order to allow cultural heritage institutions to make copies of any works or other subject matter that are permanently in their collections, in any format or medium, for purposes of preservation of such works or other subject matter and to the extent necessary for such preservation.

I. COMMENTARY Acts of reproduction for preservation by cultural heritage institutions were being dealt with in 17.160 different ways by Member States. This hampers cooperation and the sharing of means and resources and can have a negative impact on the preservation of cultural heritage.152 Article 6 DSM Directive addresses this issue through the introduction of a mandatory exception to permit cultural heritage institutions to reproduce works and other subject matter permanently in their collections for preservation purposes. Preservation purposes are seen in a rather wide sense here and do not merely include remedying the degradation of the original support or addressing its technical obsolescence (e.g., old digital formats that can no longer be opened under the latest software or films in formats for which projectors are no longer available), but the need to be able to insure works or other subject matter.153 An example of the latter could be making a digital copy of the Edwin Morgan Scrapbooks, as the originals held by the library of the University of Glasgow are fragile and may only be insured if they are not handled by all users.154 The same broad approach continues when it comes to defining works and other subject matter that 17.161 are permanently in the collection of a cultural heritage institution, i.e., what can benefit from the preservation measures. Such works and other subject matter include the scenario where copies of such works or other subject matter are owned or permanently held by that institution, for example as a result of a transfer of ownership or a licence agreement, legal deposit obligations or permanent custody arrangements. In other words, the emphasis is put on the aspect of permanency, rather than on the aspect of ownership and title.155 Let us then turn to what Article 6 describes as the making of copies or in essence what can be done 17.162 to preserve the work or subject matter. These copies can be made in any format or medium. That means in practice that the appropriate preservation tool can be chosen for each case and that the technology involved can vary. There is also no strict limit on the number of copies that can be made. And the copies can be made at any time in the life cycle of the work.156 As these operations are often

152 153 154

155 156

Directive 2019/790, Recital 26. Ibid., Recital 27. https://www.digitisingmorgan.org/Edwin, see P. Torremans, ‘Copyright Infringement, Exceptions and Limitations and Access to Shared Cultural Heritage Across Borders’ in Andrea Wallace and Ronan Deazley (eds), Display At Your Own Risk: An Experimental Exhibition of Digital Cultural Heritage (2016). Available at: http://displayatyourownrisk.org/ torremans/. Recital 29 to Directive 2019/790, Recital 29. Ibid., Recital 27.

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complex and involve specialist knowledge and equipment, cultural heritage institutions can provide assistance to one another and can rely on third parties acting on their behalf and under their responsibility, even if these are based in other Member States.157 17.163 But the exception only applies for the purposes of preservation and the making of copies and the number of copies is limited to what is required for preservation purposes. Or as Recital 27 puts it: ‘Acts of reproduction undertaken by cultural heritage institutions for purposes other than the preservation of works and other subject matter in their permanent collections should remain subject to the authorisation of rightholders, unless permitted by other exceptions or limitations provided for in Union law.’158 17.164 The scope of the exception only involves the (exclusive) rights that it covers. These rights are the press publishers’ right in Article 15(1) of the DSM Directive, the right of reproduction in the 2001 Directive,159 the right to make a permanent or temporary reproduction of a computer program by any means and in any form, in part or in whole; insofar as loading, displaying, running, transmission or storage of the computer program necessitate such reproduction in Article 4(1)(a) of the computer programmes Directive,160 the right to make a temporary or permanent reproduction by any means and in any form, in whole or in part and the sui generis right in the Database Directive (Arts 5(a) and 7(1)).161

NOTES 1. Related instruments Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs (codified version) [2009] OJ L111/16. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases [1996] OJ L77/20. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/1.

2. Bibliography Torremans, P., ‘Copyright Infringement, Exceptions and Limitations and Access to Shared Cultural Heritage Across Borders’ in Andrea Wallace and Ronan Deazley (eds), Display At Your Own Risk: An Experimental Exhibition of Digital Cultural Heritage (2016). Available at: http://displayatyourownrisk.org/torremans/. https://www.digitisingmorgan.org/Edwin.

157 158 159 160 161

Ibid., Recital 28. Ibid., Recital 27. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/1. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs (codified version) [2009] OJ L111/16. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases [1996] OJ L77/20.

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ARTICLE 8: USE OF OUT-OF-COMMERCE WORKS

ARTICLE 7: COMMON PROVISIONS 1. 2.

Any contractual provision contrary to the exceptions provided for in Articles 3, 5 and 6 shall be unenforceable. Article 5(5) of Directive 2001/29/EC shall apply to the exceptions and limitations provided for under this Title. The first, third and fifth subparagraphs of Article 6(4) of Directive 2001/29/EC shall apply to Articles 3 to 6 of this Directive.

I. COMMENTARY Paragraph (1) makes the exceptions that are created in implementing Articles 3, 5 and 6 of the 17.165 Directive mandatory. Parties can therefore no longer use contractual provisions to overrule them and such provisions in a contract shall be unenforceable. On the other hand, the exceptions and limitations provided for under this title will be subject to the 17.166 three-step test, as provided for in Article 5(5) of the 2001 Directive,162 and the protection for technological measures provided for in the first, third and fifth paragraph of Article 6(4) of the same Directive will also apply to Articles 3–6 of the DSM Directive.163

NOTES 1. Related instruments Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/1.

TITLE III: MEASURES TO IMPROVE LICENSING PRACTICES AND ENSURE WIDER ACCESS TO CONTENT CHAPTER 1 OUT-OF-COMMERCE WORKS AND OTHER SUBJECT MATTER ARTICLE 8: USE OF OUT-OF-COMMERCE WORKS AND OTHER SUBJECT MATTER BY CULTURAL HERITAGE INSTITUTIONS 1.

162 163

Member States shall provide that a collective management organisation, in accordance with its mandates from rightholders, may conclude a non-exclusive licence for noncommercial purposes with a cultural heritage institution for the reproduction, distribution, communication to the public or making available to the public of out-of-commerce works or other subject matter that are permanently in the collection of the institution, irrespective of whether all rightholders covered by the licence have mandated the collective management organisation, on condition that:

Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/1. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC [2019] OJ L 130/92.

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2.

3. 4.

5.

6. 7.

(a) the collective management organisation is, on the basis of its mandates, sufficiently representative of rightholders in the relevant type of works or other subject matter and of the rights that are the subject of the licence; and (b) all rightholders are guaranteed equal treatment in relation to the terms of the licence. Member States shall provide for an exception or limitation to the rights provided for in Article 5(a), (b), (d) and (e) and Article 7(1) of Directive 96/9/EC, Articles 2 and 3 of Directive 2001/29/EC, Article 4(1) of Directive 2009/24/EC, and Article 15(1) of this Directive, in order to allow cultural heritage institutions to make available, for noncommercial purposes, out-of-commerce works or other subject matter that are permanently in their collections, on condition that: (a) the name of the author or any other identifiable rightholder is indicated, unless this turns out to be impossible; and (b) such works or other subject matter are made available on non-commercial websites. Member States shall provide that the exception or limitation provided for in paragraph 2 only applies to types of works or other subject matter for which no collective management organisation that fulfils the condition set out in point (a) of paragraph 1 exists. Member States shall provide that all rightholders may, at any time, easily and effectively, exclude their works or other subject matter from the licensing mechanism set out in paragraph 1 or from the application of the exception or limitation provided for in paragraph 2, either in general or in specific cases, including after the conclusion of a licence or after the beginning of the use concerned. A work or other subject matter shall be deemed to be out of commerce when it can be presumed in good faith that the whole work or other subject matter is not available to the public through customary channels of commerce, after a reasonable effort has been made to determine whether it is available to the public. Member States may provide for specific requirements, such as a cut-off date, to determine whether works and other subject matter can be licensed in accordance with paragraph 1 or used under the exception or limitation provided for in paragraph 2. Such requirements shall not extend beyond what is necessary and reasonable, and shall not preclude being able to determine that a set of works or other subject matter as a whole is out of commerce, when it is reasonable to presume that all works or other subject matter are out of commerce. Member States shall provide that the licences referred to in paragraph 1 are to be sought from a collective management organisation that is representative for the Member State where the cultural heritage institution is established. This Article shall not apply to sets of out-of-commerce works or other subject matter if, on the basis of the reasonable effort referred to in paragraph 5, there is evidence that such sets predominantly consist of: (a) works or other subject matter, other than cinematographic or audiovisual works, first published or, in the absence of publication, first broadcast in a third country; (b) cinematographic or audiovisual works, of which the producers have their headquarters or habitual residence in a third country; or (c) works or other subject matter of third country nationals, where after a reasonable effort no Member State or third country could be determined pursuant to points (a) and (b).

By way of derogation from the first subparagraph, this Article shall apply where the collective management organisation is sufficiently representative, within the meaning of point (a) of paragraph 1, of rightholders of the relevant third country.

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ARTICLE 8: USE OF OUT-OF-COMMERCE WORKS

I. COMMENTARY 1. Aim Articles 8–11 aim to establish a framework for the digitisation and dissemination, including across 17.167 borders, of out-of-commerce works and other subject matter (hereinafter OOCWs) by cultural heritage institutions (hereinafter CHIs).164 This framework will enable CHIs to make OOCWs that they have in their collections available online without having to clear the rights in the traditional way, i.e., on a work-by-work basis. This commentary covers the whole package of Articles 8–11, but more specific comments on each of Articles 9, 10 and 11 will follow.

2. Background Mass digitisation and the accessibility of works and related subject matter as well as solutions how 17.168 this can be achieved best were issues that were already discussed in 2004.165 It was clear that the use of works could take place either on the basis of a prior authorisation by the rightholders or on the basis of a specific regulation or exception that would be fit for the purpose. In any case it was common ground that the clearance of rights for large number of works, work by work, would entail high costs and would be time consuming.166 The recent milestones concerning mass digitisation (which also led to the relevant provisions in the 17.169 DSM Directive) were the Memorandum of Understanding (MoU) on Key Principles on the Digitisation and Making Available of Out-of-Commerce Works (20.09.2011),167 which was signed by associations representing publishers, authors, collecting societies and libraries, under the auspices of the EU Commission and the Orphan Works Directive.168 The aim of the MoU was to encourage voluntary agreements based on collective licensing for the use by non-commercial publicly accessible institutions of out-of-commerce books and journals, contained in their collections and first published in the country of the agreement.169 The solution followed in the MoU was very similar to the Nordic ECL system despite the fact that the latter is not specifically made for OOCWs but it applies to all works irrespective of their commercial availability.170 The Orphan Works’ Directive concerns certain uses of orphan works (i.e., works protected by copyright or related rights and

164 165

166

167

168 169 170

Cultural heritage institutions are defined and discussed under Art. 2. See, e.g., the Google Books saga in 2004. M.-Chr. Janssens and R. Tryggvadóttir, ‘Orphan Works, Out-of-Commerce Works and Making the European Cultural Heritage Available: “Are We Nearly There Yet?”’ in I. Stamatoudi (ed.), New Developments in EU and International Copyright Law, Information Law Series (B. Hugenholtz (general editor)) (Wolters Kluwer, 2016), p. 189, at 196. See also G. Frosio , ‘Google Books Rejected: Taking the Orphans to the Digital Public Library of Alexandria’ (2011) 28 Santa Clara Comp. and High Tech. L. J. 81 where it is referred that in the Google Books case in the USA, courts have expressed hesitations in endorsing mechanisms similar to the ECL without explicit statutory provisions. And C. Sganga, ‘The Eloquent Silence of Soulier and Doke and its Critical Implications for EU Copyright Law’ (2017) 12(4) Journal of Intellectual Property Law & Practice 330, ‘the requirement to inform individually each and every author […] undermines the basis of the balanced mechanism through which ECLs facilitate the market-efficient licensing of whole repertoires by decreasing transaction costs’. ‘The costs of informing and ensuring that each author is informed and able to decide would be so high as to prevent any meaningful functioning of the schemes’, M. Gera, ‘A Tectonic Shift in the European System of Collective Management of Copyright? Possible Effects of the Soulier & Doke Decision’ (2017) 39(5) EIPR 263. To tackle the issue of out-of-commerce works the Commission encouraged a stakeholders’ dialogue (Commission Recommendation of 24 August 2006 on the digitisation and online accessibility of cultural material and digital preservation, Art. 6(b) OJ L 236/28). This led to the signature of the MoU http://www.eblida.org/Experts%20 Groups%20papers/EGIL-papers/MoU-OOC.pdf. Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works, OJ L299/5/27.10.2012. See Janssens and Tryggvadóttir, note 165 at 203. Ibid., at 206. See also Clause 77(3) ERR Act.

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whose rightholder(s) has not been identified or, even if identified, cannot be detected despite the fact that a diligent search has been conducted by the institutions who use the orphan works) by publicly accessible libraries, educational establishments and museums, as well as by archives, film or audio heritage institutions and public-service broadcasting organisations, established in the Member States, in order to achieve aims related to their public-interest missions.171 17.170 Apart from that, we also had national legislation in France,172 Germany173 and the UK174 that was influenced (to a larger or lesser degree) by the MoU. This legislation also paved the way for the provisions at issue. 17.171 The Soulier case175 was also vital in this respect although the European Commission seems to have followed a fresh approach on the matter. The CJEU ruled against the French law enabling an approved CMO to authorise the digital reproduction and communication to the public of out-of-commerce books. Although the law provided authors with an opt-out mechanism and some other safeguards, the CJEU declared the French law uncompliant with European law, which provides authors – not CMOs – with the right to authorise the reproduction and communication to the public of their works. In particular, the CJEU pointed at the fact that the French legislation did not include a mechanism ensuring authors are actually and individually informed.176

3. The notion of ‘out-of-commerce’ works 17.172 According to Article 8(5): A work or other subject matter shall be deemed to be out of commerce when it can be presumed in good faith that the whole work or other subject matter is not available to the public through customary channels of commerce, after a reasonable effort has been made to determine whether it is available to the public.

This is a rather broad and flexible provision compared to what is provided in the Orphan Works Directive or the MoU.

171 172

173

174

175 176

For more details see the relevant chapter in the book. Loi n° 2012-287 du 1er mars 2012 relative à l’exploitation numérique des livres indisponibles du XXe siècle. The Act introduced Art. 134-1 to 134-9 into the French Code of Intellectual Property (hereinafter FCIP). See more details and critical analysis in Alexandra Bensamoun, ‘The French Out-of-commerce Books Law in the Light of the European Orphan Works Directive’ (2014) QMJIP 213; F. Macrez (2017), ‘The French Case: From Orphan Books to Out-of-Print Works (and Vice-Versa)’, CEIPI Research Paper No. 2017-14, p. 7, available at: https://ssrn.com/ abstract=3116783; Fréderic Pollaud-Dulian, Livres indisponibles. Licence légale. Œuvres orphelines. Numérisation. Bibliothèque, RTD Com., 337 (2012); Christophe Caron, ‘Ce que dit la loi sur les livres indisponibles’, Comm. Com. Electr., nr. 11, 26 (2012). Act of 1 Oct. 2013 ‘zur Nutzung verwaister und vergriffener Werke und einer weiteren Änderung des Urheberrechtsgesetzes’ (BGBl. I 2013, S. 3728 (Nr. 59)), amending das Urheberrechtswahrnehmungsgesetz vom 9. Sep. 1965 (hereinafter ‘GCAA’). See more details in Katharina de la Durantaye, ‘Die Nutzung verwaister und vergriffener Werke – Stellungnahme zu dem Gesetzentwurf der Bundesregierung’, ZUM H. 6, 437 (2013); Nadine Klass, ‘Die Deutsche Gesetzesnovelle zur ‘Nutzung verwaister und vergriffener Werke und einer weiteren Anderung des Urheberrechtsgesetzes’ im Kontext der Ret- rodigitalisierung in Europa’, GRUR-Int., 881 (2013); Elisabeth Niggemann, ‘National Libraries and Copyright in the Digital Age – the German Situation for Orphan Works and Out-of-Print Works’ (2015) 3 Alexandria: The Journal of National and International Library and Information Issues 125. Copyright and Rights in Performances (Extended Collective Licensing) Regulations 2014, S.I. 2588. This Regulation came into force on 1 October 2014. The suggestion to introduce an ECL system in the UK was also made in the 2011 Hargreaves Report (Ian Hargreaves, Digital Opportunity: A Review of Intellectual Property and Growth (May 2011), 38). Case C-301/15, Marc Soulier, Sara Doke v. Premier ministre, Ministre de la Culture et de la Communication, Judgment of the Court (Third Chamber), 16 November 2016. Geiger, Chr., G. Frosio and O. Bulayenko, ‘Facilitating Access to Out-of-Commerce Works in the Digital Single Market – How to Make Pico della Mirandola’s Dream a Reality in the European Union’ (2019) 10(3) JIPITEC – Journal of Intellectual Property, Information Technology and E-Commerce Law https://www.jipitec.eu/issues/jipitec-9-32018/4803.

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More particularly all types of works are included within the notion of OOCWs and not only literary 17.173 works, as the case was with the MoU and the Orphan Works’ Directive. Commercial availability is assessed in good faith, which is a concept deriving from civil law, and 17.174 remains to be determined by the Court of Justice in the case at issue. Since it has been included in an EU law instrument (as the case also is with orphan works – Art. 3(1) of the Orphan Works Directive), it should be construed in a uniform and autonomous manner throughout the EU, preventing Member States from using their national legal systems for defining it.177 When a work (or other subject matter) is available in any of its different versions, such as subsequent 17.175 editions of literary works and alternate cuts of cinematographic works, or in any of its different manifestations, such as digital and printed formats of the same work, that work or other subject matter should not be considered out of commerce. Conversely, the commercial availability of adaptations, including other language versions or audiovisual adaptations of a literary work, should not preclude a work from being deemed to be out of commerce in a given language.178 17.176

Also: [w]hen determining whether works or other subject matter are out of commerce, a reasonable effort should be required to assess their availability to the public in the customary channels of commerce, taking into account the characteristics of the particular work or other subject matter or of the particular set of works or other subject matter. Member States should be free to determine the allocation of responsibilities for making that reasonable effort. The reasonable effort should not have to involve repeated action over time but it should nevertheless involve taking account of any easily accessible evidence of upcoming availability of works or other subject matter in the customary channels of commerce. A work-by-work assessment should only be required where that is considered reasonable in view of the availability of relevant information, the likelihood of commercial availability and the expected transaction cost …179

Verification of availability of a work or other subject matter should normally take place in the 17.177 Member State where the cultural heritage institution is established, unless verification across borders is considered reasonable, for example, in cases where there is easily available information that a literary work was first published in a given language version in another Member State. In many cases, the out-of-commerce status of a set of works or other subject matter could be determined through a proportionate mechanism, such as sampling. The limited availability of a work or other subject matter, such as its availability in second-hand shops, or the theoretical possibility that a licence for a work or other subject matter could be obtained should not be considered as availability to the public in the customary channels of commerce.180 Recital 37 also provides that in order to reflect the specificities of different types of works and other 17.178 subject matter as regards modes of publication and distribution, and to facilitate the usability of those mechanisms, specific requirements and procedures might have to be established for the practical application of those licensing mechanisms, such as a requirement for a certain time period to have elapsed since the work or other subject matter was first commercially available. Therefore,

177

178 179 180

See Case C-5/08 Infopaq International (2009) ECR I-6569 [27]; Case C-34/10 Brüstle (2011) ECR I-09821 [25]; and Case C-510/10 DR and TV2 Danmark (published in the electronic Reports of Cases: https://curia.europa.eu/jcms/jcms/ P_106320/en/?rec=RG&jur=C&anchor=201204C0076#201204C0076) [33], as referred to in Case C-128/11 UsedSoft GmbH v. Oracle International Corp. [39] (published in the electronic Reports of Cases: https://curia.europa.eu/jcms/ jcms/P_106320/en/?rec=RG&jur=C&anchor=201207C0127). See also, Case C-357/98 Yiadom (2000) ECR I-9265 [26], Case C-245/00 SENA (2003) ECR I-1251 [23) and Case C-306/05 SGAE (2006) ECR I-11519 [31]. Recital 37. Recital 38. Recital 38.

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Member States should consult rightholders, cultural heritage institutions and collective management organisations when establishing such requirements and procedures (see below the stakeholder dialogue). 17.179 This provision can be used for different types of works and other subject matter, including photographs, software, phonograms, audiovisual works and unique works of art, including where they have never been exploited commercially. Never-in-commerce works can include posters, leaflets, trench journals or amateur audiovisual works, but also unpublished works or other subject matter, without prejudice to other applicable legal constraints, such as national rules on moral rights.181 Therefore non-commercially available works are also included in the definition of OOCWs. 17.180 Despite the fact that the concept of out-of-commerce works seems to be harmonised to a considerable degree there is one more issue that renders this harmonisation vulnerable to a certain extent. Member States may provide for specific requirements, such as a cut-off date, to determine whether works and other subject matter can be licensed according to Article 8(1) and (2). There is a safety valve though based on reasonableness and proportionality. But again, these are vague concepts that until a definite approach is devised by the CJEU – if a case arises – EU Member States will interpret it in their own manner. Characteristic in this respect are the laws of Germany and France according to which this provision does not apply to works published before the years 1966 and 2001 respectively.182 17.181 One needs to point out here that only works or other subject matter that are permanently in the collection of the cultural heritage institution that is interested in digitising and making them available online, can be considered OOCWs. According to Recital 29 works and other subject matter are considered to be permanently in the collection of a CHI when copies of them are owned or permanently held by that institution, for example as a result of a transfer of ownership or a licence agreement, legal deposit obligations or permanent custody arrangements. It can, of course, be presumed that copies of works purchased or acquired in some other manner in the future are also included since CHIs are expected to continue enriching their collections. 17.182 Sets of OOCWs or other subject matter, which on the basis of the reasonable effort that has been made to determine whether they are commercially available, are found to predominantly consist of (a) works or other subject matter, other than cinematographic or audiovisual works, first published or, in the absence of publication, first broadcast in a third country, or (b) cinematographic or audiovisual works, of which the producers have their headquarters or habitual residence in a third country; or (c) works or other subject matter of third country nationals, where after a reasonable effort no Member State or third country could be determined pursuant to points (a) and (b), are not subject to the regime established by the DSM Directive for OOCWs unless the CMO of that Member State is sufficiently representative of rightholders of the relevant third country, for example via a representation agreement (Art. 8(7) and Recital 39). That assessment could be based on the evidence available following the making of the reasonable effort to determine whether the works or other subject matter are out of commerce, without the need to search for further evidence. A work-by-work assessment of the origin of out-of-commerce works or other subject matter should only be required insofar as it is also required for making the reasonable effort to determine whether they are commercially available (Recital 39).

181 182

Recital 37. Synodinou T., The New Copyright Directive: Out of commerce works (Articles 8 to 11): is it possible to untie the Gordian knot of mass digitisation and copyright law without cutting it off? – Part I, Kluwer Copyright Blog, July 29, 2019.

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4. The two solutions for the online use of OOCWs If one forms a cultural heritage institution (as defined in Art. 2 DSM Directive) and wants to 17.183 digitise OOCWs that are permanently in its collection, there are two mechanisms: the first mechanism is enshrined in paragraph 1 (Art. 8(1)) and it provides for the ability for representative collective management organisations (CMOs) to issue licences for the use of OOCWs by cultural heritage institutions (CHIs) irrespective of whether all rightholders covered by such licences have mandated the CMO with such rights. Where no representative CMOs (Art. 8(2)) exist that could issue licences for a certain type of works, CHIs can rely on an exception that allows them to make OOCWs in their collection available online (Art. 8(2)). In both cases rightholders may opt out (prevent CHIs from digitising and making their works 17.184 available online). CHIs and CMOs publish information about the OOCWs in a ‘public single online portal’ that will be administered by the EUIPO six months before they make the works available online. This six-month period is intended to give rightholders the actual possibility to opt out before their works are made available (Art. 10(1)). After six months’ lapse, the works can be made available on the CHI’s website for non-commercial purposes either under the terms of the licence agreed between the CHI and the CMO or by relying upon the exception. In either case, the CHI does not carry the risk of being held liable for copyright infringement.183

5. Licensing of OOCWs by representative CMOs In the first case Member States have to provide in their national laws that where a representative – 17.185 (a) of rightholders in the relevant type of works or other subject matter and (b) of the rights that are the subject of the licence – CMO exists, this CMO may (it has the discretion) conclude a non-exclusive licence for non-commercial purposes with a CHI for the reproduction, distribution, communication to the public or making available to the public of out-of-commerce works or other subject matter that are permanently in its collection, irrespective of whether all rightholders covered by the licence have mandated the CMO at issue. The licence is provided in accordance with its mandates from rightholders whilst all rightholders (irrespective of whether they are its members or not) are guaranteed equal treatment in relation to the terms of the licence. The fact that non-members are also covered is considered a form of Extended Collective Licensing 17.186 (ECL) along the lines of the Nordic system. It is clear from the above that the crucial point is that a representative CMO in the country exists. 17.187 There may be countries that either do not have a representative CMO or such a CMO is not (e.g., commercially) interested in providing such a licence. A licence is only provided if the parties (CHI and CMO) agree on the terms of it. In cases where a CMO is not interested in providing a licence or did not come to an agreement in this respect, rights need to be cleared in the traditional method or simply the OOCWs will not be digitised or become available. This is a drawback since the exception provided in paragraph 2 of Article 8 does not come into play, since it is only triggered if a representative CMO does not exist and not if a representative CMO does not cooperate (Art. 8(3)). This is a drawback that may perhaps need to be addressed at some point. According to paragraph 6 a CHI should seek a licence from a representative CMO in the territory 17.188 where it is established. Yet, according to paragraph 9(1) Member States should ensure that licences

183

P. Keller, Independent Policy Adviser to Europeana Foundation Explainer: What will the DSM directive change for cultural heritage institutions? Europeana Foundation, June 2019 https://pro.europeana.eu/files/Europeana_ Professional/Publications/Explainer_%20What%20will%20the%20DSM%20directive%20change%20for%20cultural% 20heritage%20institutions_%20090619.pdf.

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granted under Article 8(1) may allow the use of OOCWs by CHIs in any Member State or all Member States.184 That clearly facilitates even further digitisation and use of works especially because most – if not all – CHIs’ websites are available and accessible throughout the EU. Thus, CMOs should be able to provide multi-territorial licences without the need for countries to establish extra requirements for such a possibility as the case is with multi-territorial licences for online uses of musical works.185, 186 17.189 Recital 40 provides that CHIs and CMOs: should remain free to agree on the territorial scope of licences, including the option of covering all Member States, the licence fee and the uses allowed. Uses covered by such licences should not be for profit-making purposes, including where copies are distributed by the CHI, such as in the case of promotional material about an exhibition. At the same time, given that the digitisation of the collections of CHI can entail significant investments, any licences granted under the mechanism provided for in this Directive should not prevent cultural heritage institutions from covering the costs of the licence and the costs of digitising and disseminating the works or other subject matter covered by the licence.

17.190 It goes without saying that CMOs should operate on EU standards according to what is provided in the Directive on Collective Management.187

6. Online use of OOCWs by reason of an exception 17.191 If a representative CMO for a particular type of works does not exist in a Member State, this Member State needs to provide for an exception or limitation on the basis of which OOCWs shall be digitised and become available online according to what is provided in paragraph 2. More specifically Member States shall provide for an exception or limitation to the (a) reproduction, communication to the public and the making available to the public right (Art. 4(1) of Directive 2009/24/EC), (b) to all restricted acts pertaining to software (Art. 4(1) of Directive 2009/24/EC), (c) to all restricted acts pertaining to copyrightable databases – except for the right of distribution – and to databases protected by a sui generis right (Art. 5(a), (b), (d) and (e) and Art. 7(1) of Directive 96/9/EC), and (d) to the rights provided for the press publication in this Directive (DSM Directive). This exception should allow cultural heritage institutions to make available, for

184

See Recital 31 according to which: All Member States should have legal mechanisms in place allowing licences issued by relevant and sufficiently representative collective management organisations to cultural heritage institutions, for certain uses of out-ofcommerce works or other subject matter, to also apply to the rights of rightholders that have not mandated a representative collective management organisation in that regard. It should be possible, pursuant to this Directive, for such licences to cover all Member States.

185

186

Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market, OJ L 84, 20.3.2014, p. 72 (Arts 23–32). Case C-170/12, Peter Pickney v. KDG Mediatech AG, delivered on 3.10.2013, ECLI:EU:C:2013:635 (according to which: Article 5(3) of Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters must be interpreted as meaning that, in the event of alleged infringement of copyrights protected by the Member State of the court seised, the latter has jurisdiction to hear an action to establish liability brought by the author of a work against a company established in another Member State and which has, in the latter State, reproduced that work on a material support which is subsequently sold by companies established in a third Member State through an internet site also accessible with the jurisdiction of the court seised. That court has jurisdiction only to determine the damage caused in the Member State within which it is situated.

187

See Recital 34 DSM Directive. Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market, OJ L 84, 20.3.2014, p. 72.

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non-commercial purposes, out-of-commerce works or other subject matter, that are permanently in their collections, on condition that: (a) the name of the author or any other identifiable rightholder is indicated, unless this turns out to be impossible and (b) such works or other subject matter are made available on non-commercial websites. Recital 32 provides for the cases where there is no practice of collective management of rights for a 17.192 certain type of work or other subject matter or where the relevant CMO is not sufficiently representative for the category of the rightholders and of the rights concerned in a particular country. In such particular instances [according to the Recital], it should be possible for cultural heritage institutions to make out-of-commerce works or other subject matter that are permanently in their collection available online in all Member States under a harmonised exception or limitation to copyright and related rights. It is important that uses under such exception or limitation only take place when certain conditions, in particular as regards the availability of licensing solutions, are fulfilled. A lack of agreement on the conditions of the licence should not be interpreted as a lack of availability of licensing solutions.

Member States decide themselves who is to have legal responsibility as regards (a) the compliance of 17.193 the licensing of out-of-commerce works or other subject matter, and (b) of their use, with the conditions set out in this Directive, and as regards the compliance of the parties concerned with the terms of those licences (Recital 36).

7. Opt-out and publicity measures According to paragraph 4 Member States are obliged to provide that all rightholders may, at any 17.194 time, easily and effectively, exclude their works or other subject matter from the licensing mechanism set out in paragraph 1 or from the application of the exception or limitation provided for in paragraph 2, either in general or in specific cases, including after the conclusion of a licence or after the beginning of the use concerned. Yet, in order to be able for one to exercise her or his opt-out one must learn that her or his work is to be included in a CHI’s website. The publicity measures in this respect are enshrined in Article 10 and refer to a ‘public single online portal’. More specifically Member States need to provide in their national laws that (a) information from 17.195 CHIs, CMOs or relevant public authorities, for identifying out-of-commerce works or other subject matter (either covered by a licence or used under the exception or limitation), (b) information about the options available to rightholders under the opt-out provision (Art. 8(4)), and (c) – where available and relevant – information on the parties to the licence, the territories covered and the uses, is made permanently, easily and effectively accessible on a public single online portal from at least six months before any of the authorised or exempted acts (i.e., distribution, communication to the public or making available to the public in accordance with the licence or under the exception or limitation) are performed.188 The portal shall be established and managed by

188

See Recital 35: Appropriate safeguards should be available for all rightholders, who should be given the opportunity of excluding the application of the licensing mechanisms and of the exception or limitation, introduced by this Directive for the use of out-of-commerce works or other subject matter, in relation to all their works or other subject matter, in relation to all licences or all uses under the exception or limitation, in relation to particular works or other subject matter, or in relation to particular licences or uses under the exception or limitation, at any time before or during the term of the licence or before or during the use under the exception or limitation. Conditions governing those licensing mechanisms should not affect their practical relevance for cultural heritage institutions. It is important that, where a rightholder excludes the application of such mechanisms or of such exception or limitation to one or more works or other subject matter, any ongoing uses are terminated within a reasonable period, and, where they take place under a collective licence, that the collective management organisation once informed ceases to issue licences covering the

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the European Union Intellectual Property Office (Regulation (EU) No 386/2012).189 This provision does not preclude the case where another type of information is also included so as to facilitate the application of the mechanisms.190 This information should be adequately publicised both before and during the use under a licence or under the exception or limitation, as appropriate. Such publicising is particularly important when uses take place across borders in the internal market (Recital 41). 17.196 In case a rightholder excludes the application of such mechanisms (i.e., licensing of his works or the application of the exception), any ongoing uses are terminated within a reasonable period, and, where they take place under a collective licence, that the CMO once informed ceases to issue licences covering the uses concerned. Such exclusion by rightholders should not affect their claims to remuneration for the actual use of the work or other subject matter under the licence (Recital 35). It is clear from the above that the exception at issue is not mandatory and rightholders may opt out of it. 17.197 Paragraph 2 also gives Member States (where the licence is sought under Art. 8(1) or in the case of a use under the exception or limitation (Art. 8(2)) the Member State where the CHI is established) the ability to provide ‘additional appropriate publicity measures’ – if necessary – for the general awareness of rightholders. These measures concern (i) the ability of CMOs to license OOCWs, (ii) the licences granted or uses allowed under the exception or limitation and (iii) the options available to rightholders under opt-out (Art. 8(4)). In this respect the system of publicity is reinforced even further to the benefit of rightholders without, however, providing for an extension of the initial six-month period.191 17.198 If there is evidence, such as the origin of the works or other subject matter, to suggest that the awareness of rightholders could be more efficiently raised in other Member States or third countries, such publicity measures should also cover those Member States and third countries.

8. Stakeholder dialogue 17.199 As we noted, there are a number of issues that are not fully regulated/harmonised by the Directive or which look rather complex. These are, for example, the cases where CHIs need to identify large

uses concerned. Such exclusion by rightholders should not affect their claims to remuneration for the actual use of the work or other subject matter under the licence. 189

Recital 41: […] Under Regulation (EU) No 386/2012 of the European Parliament and of the Council, the European Union Intellectual Property Office is entrusted with certain tasks and activities, financed by making use of its own budgetary means and aimed at facilitating and supporting the activities of national authorities, the private sector and Union institutions in the fight against, including the prevention of, infringement of intellectual property rights. It is therefore appropriate to rely on that Office to establish and manage the portal making such information available. […].

190

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Keller, Independent Policy Adviser to Europeana Foundation Explainer, note 183: ‘It needs to allow batch uploads via a web interface and APIs and support commonly used metadata formats used within the cultural heritage sector. To be meaningful for visual works the portal further needs to allow the publication of reduced size thumbnails as part of the required identifying information.’ See also Recital 41: […] In addition to making the information available through the portal, further appropriate publicity measures might need to be taken on a case-by-case basis in order to increase the awareness in that regard of the rightholders concerned, for example through the use of additional channels of communication to reach a wider public. The necessity, the nature and the geographic scope of the additional publicity measures should depend on the characteristics of the relevant out-of-commerce works or other subject matter, the terms of the licences or the type of use under the exception or limitation, and the existing practices in Member States. Publicity measures should be effective without the need to inform each rightholder individually.

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amounts of works as being out-of-commerce, especially when it comes to works other than published works (e.g., books and journals) such as artworks, audiovisual works or photographs. Another difficult case is where a CMO – although representative – is not interested in licensing an OOCW because, for example, it is not commercially interesting to it or because it does not agree with the terms of the CHI’s suggestions. In these cases, the OOCWs cannot be digitised and made available to the public and neither can the exception or limitation apply.192 In order to reflect the specificities of different types of works (or other subject matter) as regards 17.200 modes of publication and distribution, and to facilitate the usability of those mechanisms, specific requirements and procedures may have to be established for the practical application of those licensing mechanisms, such as a requirement for a certain time period to have elapsed since the work was first commercially available. The Directive provides that it is appropriate that Member States consult rightholders, CHIs and CMOs when establishing such requirements and procedures.193 Stakeholder dialogue may thus prove important.194 According to Article 11 Member States should 17.201 consult rightholders, CMOs and CHIs in each sector before establishing specific requirements for OOCWs (pursuant to Art. 8(5)), and should encourage regular dialogue between representative users’ and rightholders’ organisations, including CMOs, and any other relevant stakeholder organisations, on a sector-specific basis, to foster the relevance and usability of the licensing mechanisms (set out in Art. 8(1)) and to ensure that the safeguards for rightholders referred to in the Directive’s relevant provisions are effective. The measures provided in those articles to facilitate the collective licensing of rights in OOCWs 17.202 should not impinge on the use of such works under the exceptions or limitations provided for in Union law, or under other licences with an extended effect, where such licensing is not based on the out-of-commerce status of the covered works. Those measures should not also prejudice national mechanisms for the use of OOCWs based on licences between CMOs and users other than CHIs.195

NOTES 1. Related instruments Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/1. Regulation (EU) No 386/2012 of the European Parliament and of the Council of 19 April 2012 on entrusting the Office for Harmonization in the Internal Market (Trade Marks and Designs) with tasks related to the enforcement of intellectual property rights, including the assembling of public and private-sector representatives as a European Observatory on Infringements of Intellectual Property Rights [2012] OJ L 129/1. Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market [2014] OJ L 84/72.

192 193 194

Keller, Independent Policy Adviser to Europeana Foundation Explainer, note 183. Recital 37. See Recital 42: In order to ensure that the licensing mechanisms established by this Directive for out-of-commerce works or other subject matter are relevant and function properly, that rightholders are adequately protected, that licences are properly publicised and that legal certainty is provided with regard to the representativeness of collective management organisations and the categorisation of works, Member States should foster sector-specific stakeholder dialogue.

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Recital 42.

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2. CJEU case law Case C-301/15, Marc Soulier, Sara Doke v. Premier ministre, Ministre de la Culture et de la Communication. Case C-5/08 Infopaq International (2009) ECR I-6569. Case C-34/10 Brüstle (2011) ECR I-09821. Case C-510/10 DR and TV2 Danmark ECLI:EU:C:2012:244. Case C-128/11 UsedSoft GmbH v. Oracle International Corp. ECLI:EU:C:2012:407. Case C-357/98 Yiadom (2000) ECR I-9265. Case C-245/00 SENA (2003) ECR I-1251. Case C-306/05 SGAE (2006) ECR I-11519. Case C 170/12 Peter Pickney v. KDG Mediatech AG ECLI:EU:C:2013:635.

3. Bibliography Benabou V-L. (2017), ‘Pourquoi l’arrêt Soulier et Doke dépasse le cas ReLire: le contrôle par la CJUE des modalités de l’autorisation préalable de l’auteur’, Dalloz IP/IT, Vol. 2, p. 110. Bensamoun A., ‘The French Out-of-Commerce Books Law in the Light of the European Orphan Works Directive’ (2014) QMJIP 213. Bulayenko O., ‘Permissibility of Non-Voluntary Collective Management of Copyright under EU Law: The Case of the French Law on Out-of-Commerce Books’ (2016) 7(1) JIPITEC 57. Caron Chr., ‘Ce que dit la loi sur les livres indisponibles’ (2012) Comm. Com. Electr., nr. 11, 26. Ciurcina M., J. C. De Martin, Th. Margoni, F. Morando and M. Ricolfi (2009), Creatività Remunerata, Cono-scenza Liberata: File Sharing e Licenze Collettive Estese, 15 March 2009 (position paper prepared for the NEXA Center for Internet and Society). de la Durantaye K., ‘Die Nutzung verwaister und vergriffener Werke – Stellungnahme zu dem Gesetzentwurf der Bundesregierung’ (2013) ZUM H. 6, 437. Fontaine G. and P. Simone (2017), The Access to Film Works in the Collections of Film Heritage Institutions in the Context of Education and Research, Strasbourg, France: European Audiovisual Observatory. Geiger Chr. (2009), ‘The Future of Copyright in Europe: Striking a Fair Balance between Protection and Access to Information’, Report for the Committee on Culture, Science and Education – Parliamentary Assembly, Council of Europe, Strasbourg, October 2009. Frosio G., ‘Google Books Rejected: Taking the Orphans to the Digital Public Library of Alexandria’ (2011) 28 Santa Clara Comp. and High Tech. L. J. 81. Geiger Chr., G. Frosio and O. Bulayenko, Facilitating Access to Out-of-Commerce Works in the Digital Single Market – How to Make Pico della Mirandola’s Dream a Reality in the European Union, (2019) 10(3) JIPITEC – Journal of Intellectual Property, Information Technology and E-Commerce Law https://www.jipitec.eu/issues/jipitec-93-2018/4803. Gera M., ‘Extended Collective Licensing under the New Slovak Copyright Act’ (2016) 11(3) JIPLP 170. Gera M., ‘A Tectonic Shift in the European System of Collective Management of Copyright? Possible Effects of the Soulier & Doke decision’ (2017) 39(5) EIPR 263. Hugenholtz B. and R. Okediji (2008), Conceiving an International Instrument on Limitations and Exceptions to Copyright, Final Report, March 2008, p. 19, available at https://www.ivir.nl/publicaties/download/l. Janssens M.-Chr. and R. Tryggvadóttir, ‘Orphan Works, Out-of-Commerce Works and Making the European Cultural Heritage Available: “Are We Nearly There Yet?”’ in I. Stamatoudi (ed.), New Developments in EU and International Copyright Law, Information Law Series (B. Hugenholtz (general editor)) (Wolters Kluwer, 2016) p. 189. Jiang F. and D. Gervais, ‘Collective Management in China, in Daniel Gervais (ed.), Collective Management of Copyright and Related Rights (3rd ed., Alphen aan den Rijn, Netherlands: Kluwer Law International, 2016) p. 444. Keller P., Independent Policy Adviser to Europeana Foundation Explainer: What will the DSM directive change for cultural heritage institutions? Europeana Foundation, June 2019 https://pro.europeana.eu/files/Europeana_ Professional/Publications/Explainer_%20What%20will%20the%20DSM%20directive%20change%20for%20 cultural%20heritage%20institutions_%20090619.pdf. N. Klass, ‘Die Deutsche Gesetzesnovelle zur “Nutzung verwaister und vergriffener Werke und einer weiteren Änderung des Urheberrechtsgesetzes” im Kontext der Ret- rodigitalisierung in Europa’ (2013) GRUR-Int., 881. Koskinen-Olsson T. and V. Sigurdardóttir, ‘Collective Management in the Nordic Countries’, in Daniel Gervais (ed.), Collective Management of Copyright and Related Rights (3rd ed., Alphen aan den Rijn, Netherlands: Kluwer Law International, 2016), p. 243.

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ARTICLE 9: CROSS-BORDER USES Liu W., ‘Models for Collective Management of Copyright from an International Perspective: Potential Changes for Enhancing Performance’ (2012) 17 Journal of Intellectual Property Rights 54. Macrez F., The French Case: From Orphan Books to Out-of-Print Works (and Vice-Versa), CEIPI Research Paper No. 2017-14, p. 7, available at: https://ssrn.com/abstract=3116783. Mopsik E., ‘Photographers and Collective Licencing: A Short History with No Ending’ (2011) 34(4) Columbia J. of L. & the Arts 619–22. Niggemann E., ‘National Libraries and Copyright in the Digital Age – The German Situation for Orphan Works and Out-of-Print Works’ (2012) 23 Alexandria: The Journal of National and International Library and Information Issues 125. Pollaud-Dulian F., Livres indisponibles. Licence légale. Œuvres orphelines. Numérisation. Bibliothèque, (2012) RTD Com. 337. Riis Th. and J. Schovsbo, ‘Extended Collective Licenses and the Nordic Experience – It’s a Hybrid but Is It a Volvo or a Lemon?’ (2010) 33(IV) Columbia Journal of Law and the Arts 471. Ringelhann A. P. and M. Mimler, ‘Digital Exploitation of Out-of-print Books and Copyright Law: French Licensing Mechanism for Out-of-Print Books under CJEU Scrutiny’ (2017) 39(3) EIPR 193. Sganga C., ‘The Eloquent Silence of Soulier and Doke and its Critical Implications for EU Copyright Law’ (2017) 12(4) Journal of Intellectual Property Law & Practice 330. Strowel A., ‘The European “Extended Collective Licensing” Model’ (2011) 34(4) Columbia Journal of Law & the Arts 665. Synodinou T., The New Copyright Directive: Out of commerce works (Articles 8 to 11): is it possible to untie the Gordian knot of mass digitisation and copyright law without cutting it off? – Part I, Kluwer Copyright Blog, July 29, 2019. The study of the US Copyright Office recommended establishment of a ‘pilot’ extended collective licensing for mass digitisation projects ‘serving nonprofit educational and research purposes’, US Copyright Office (2015), Orphan Works and Mass Digitization, Report of the Register of Copyrights. von Lewinski S. (2004), ‘Mandatory Collective Administration of Exclusive Rights – A Case Study on Its Compatibility with International and EC Copyright Law’, e-Copyright Bulletin, January–March 2004, available at: portal.unesco.org/culture/en/files/19552/11515904771svl_e.pdf/svl_e.pdf.

ARTICLE 9: CROSS-BORDER USES 1. 2.

Member States shall ensure that licences granted in accordance with Article 8 may allow the use of out-of-commerce works or other subject matter by cultural heritage institutions in any Member State. The uses of works and other subject matter under the exception or limitation provided for in Article 8(2) shall be deemed to occur solely in the Member State where the cultural heritage institution undertaking that use is established.

I. COMMENTARY Digitisation may involve significant investments that may not be capable of being recouped on a 17.203 purely national basis and cultural heritage institutions may wish to attract an international audience. It is therefore important that the use authorised by the licence provided in Article 8 can cover use by cultural heritage institutions in all Member States. An example of such use that comes to mind is the cross-border use on the promotional material for an exhibition. Collective management organisations may on the other hand only have the national rights available for licensing and use in other Member States could therefore remain infringing use. Paragraph 1 of Article 9 therefore obliges Member States to make a licence allowing for cross-border use possible. Contracting cultural heritage institutions and CMOs remain in other words free to agree on the territorial scope of licences, including the option of covering all Member States, the licence fee and the uses allowed

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and to make the suitable and appropriate choices in this respect.196 And there is no real risk of forum shopping for a cheap deal, as the institutions are based in one place and will have to deal with the local CMO for works in their collections. 17.204 That solution in turn creates a problem for the limitation and exception that is created in a complementary way in Article 8(2). Article 8(1) Rome II Regulation197 would result here in the application of the law of the country for which protection is sought on a country-by-country basis for each country where the use takes place. The application of multiple laws on a country-bycountry basis is undesirable here and would place an additional heavy burden on the CHIs. This is avoided by the creation of a presumption that any use of works and other subject matter under the exception or limitation is deemed to occur solely in the Member State where the CHI undertaking that use is established. Article 8(1) then results in the application of a single law that will be the law of the exception and limitation and the law of the place of establishment of the cultural heritage institution involved.198

NOTES 1. Related instruments Regulation (EC) No 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law applicable to non-contractual obligations (Rome II) [2007] OJ L 199/40.

2. Bibliography Fawcett, J. J. and P. Torremans, Intellectual Property and Private International Law (2nd ed, Oxford University Press, 2011).

ARTICLE 10: PUBLICITY MEASURES 1.

2.

196 197 198

Member States shall ensure that information from cultural heritage institutions, collective management organisations or relevant public authorities, for the purposes of the identification of the out-of-commerce works or other subject matter, covered by a licence granted in accordance with Article 8(1), or used under the exception or limitation provided for in Article 8(2), as well as information about the options available to rightholders as referred to in Article 8(4), and, as soon as it is available and where relevant, information on the parties to the licence, the territories covered and the uses, is made permanently, easily and effectively accessible on a public single online portal from at least six months before the works or other subject matter are distributed, communicated to the public or made available to the public in accordance with the licence or under the exception or limitation. The portal shall be established and managed by the European Union Intellectual Property Office in accordance with Regulation (EU) No 386/2012. Member States shall provide that, if necessary for the general awareness of rightholders, additional appropriate publicity measures are taken regarding the ability of collective management organisations to license works or other subject matter in accordance with

Recital 40 of Directive 2019/790. Regulation (EC) No 864/2007 of the European Parliament and of the Council of 11 July 2007 on the law applicable to non-contractual obligations (Rome II) [2007] OJ L 199/40. J.J. Fawcett and P. Torremans, Intellectual Property and Private International Law, Oxford University Press (2nd ed, 2011), Ch. 12.

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Article 8, the licences granted, the uses under the exception or limitation provided for in Article 8(2) and the options available to rightholders as referred to in Article 8(4). The appropriate publicity measures referred to in the first subparagraph of this paragraph shall be taken in the Member State where the licence is sought in accordance with Article 8(1) or, for uses under the exception or limitation provided for in Article 8(2), in the Member State where the cultural heritage institution is established. If there is evidence, such as the origin of the works or other subject matter, to suggest that the awareness of rightholders could be more efficiently raised in other Member States or third countries, such publicity measures shall also cover those Member States and third countries.

I. COMMENTARY The objective of the new rules in Article 8 of the Directive is to enable cultural heritage institutions 17.205 to make out-of-commerce works that they have in their collections available online without having to clear the rights on a work-by-work basis. Two mechanisms are deployed in order to achieve this. Article 8(1) introduces the ability for representative CMOs to issue licences for the use of out-of-commerce works by CHIs ‘irrespective of whether all rights holders covered by licence have mandated the collective management organisation’. And Article 8(2) adds the option of a copyright exception to make out-of-commerce works in their collection available online for those situations where there are no representative CMOs. As a crucial part of both mechanisms to restore the balance, rightholders must have the ability to opt out and to prevent the CHIs from making their works available. That means that information about out-of-commerce works must be made available in an accessible way in order to give rightholders the ability to do so.199 Such publicising is particularly important when uses take place across borders in the internal market.200 Article 10 therefore instructs Member States to ensure that CHIs and CMOs publish information about those out-of-commerce works in a public single online portal to be run by the EUIPO and that they do so six months before the works or other subject matter are distributed, communicated to the public or made available to the public in accordance with the licence or under the exception or limitation. This six-month period is intended to give rightholders a real possibility to opt out before their works are made available online.201 The online portal shall contain information concerning the planned use under either Article 8(1) or 17.206 Article 8(2), information about the options available to rightholders as referred to in Article 8(4), and, as soon as it is available and where relevant, information on the parties to the licence and the territories covered. Such information should be made accessible permanently, easily and effectively on the public single online portal. The portal works on a case-by-case basis, but there is also a need to raise general awareness on this 17.207 point. Therefore, further appropriate publicity measures might need to be taken on a case-by-case basis in order to increase the awareness in that regard of the rightholders concerned, for example, through the use of additional channels of communication to reach a wider public. The necessity, the nature and the geographic scope of the additional publicity measures will depend on the characteristics of the relevant out-of-commerce works or other subject matter, the terms of the licences or the type of use under the exception or limitation, and the existing practices in Member States. Publicity

199

200 201

P. Keller, ‘Explainer: What will the new EU copyright rules change for Europe’s Cultural Heritage Institutions’, Europeana Pro, https://pro.europeana.eu/post/explainer-what-will-the-new-eu-copyright-rules-change-for-europe-scultural-heritage-institutions. Directive 2019/790, Recital 41. Ibid., Art. 10(1).

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measures should be effective without the need to inform each rightholder individually.202 The appropriate publicity measures shall be taken in the Member State where the licence is sought in accordance with Article 8(1) or, for uses under the exception or limitation provided for in Article 8(2), in the Member State where the cultural heritage institution is established. And if there is evidence, such as the origin of the works or other subject matter, to suggest that the awareness of rightholders could be more efficiently raised in other Member States or third countries, such publicity measures shall also cover those Member States and third countries.203

NOTES 1. Bibliography Keller, P., ‘Explainer: What will the new EU copyright rules change for Europe’s Cultural Heritage Institutions’, Europeana Pro, https://pro.europeana.eu/post/explainer-what-will-the-new-eu-copyright-rules-change-foreurope-s-cultural-heritage-institutions.

ARTICLE 11: STAKEHOLDER DIALOGUE Member States shall consult rightholders, collective management organisations and cultural heritage institutions in each sector before establishing specific requirements pursuant to Article 8(5), and shall encourage regular dialogue between representative users’ and rightholders’ organisations, including collective management organisations, and any other relevant stakeholder organisations, on a sector-specific basis, to foster the relevance and usability of the licensing mechanisms set out in Article 8(1) and to ensure that the safeguards for rightholders referred to in this Chapter are effective.

I. COMMENTARY 17.208 Enabling access to out-of-commerce works and other subject matter is of crucial importance and major progress on this point can be expected if the Directive is implemented successfully. But there are two obvious weak links in this process. First, it may turn out to be too complicated for CHIs to identify substantial amounts of works as being out of commerce. And secondly, while the Directive requires Member States to ensure that representative CMOs can issue licences for collections of out-of-commerce works that include works by non-members, it does not require them to do so. This means that CMOs can simply refuse to issue licences, for example, because they are not commercially interesting for them. The solution to these weak points is found in dialogue between the interested parties and Article 11 puts that in place a dual way. Member States shall consult rightholders, CMOs and CHIs in each section before they implement the requirements in Article 8(5) and, on a more permanent basis, they will encourage regular dialogue between all stakeholders ‘to foster the relevance and usability of the licensing mechanisms set out in Article 8(1) and to ensure that the safeguards for rightholders referred to in this Chapter are effective’.204 Good

202 203 204

Ibid., Recital 41. Ibid., Art. 10(2). Ibid., Recital 42.

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collaboration will be essential for the success of the Directive on this point. That might result in practical arrangements that work for all sides.205

NOTES 1. Bibliography Keller, P., ‘Explainer: What will the new EU copyright rules change for Europe’s Cultural Heritage Institutions’, Europeana Pro, https://pro.europeana.eu/post/explainer-what-will-the-new-eu-copyright-rules-change-foreurope-s-cultural-heritage-institutions.

CHAPTER 2 MEASURES TO FACILITATE COLLECTIVE LICENSING ARTICLE 12: COLLECTIVE LICENSING WITH AN EXTENDED EFFECT 1.

2.

3.

205

Member States may provide, as far as the use on their territory is concerned and subject to the safeguards provided for in this Article, that where a collective management organisation that is subject to the national rules implementing Directive 2014/26/EU, in accordance with its mandates from rightholders, enters into a licensing agreement for the exploitation of works or other subject matter: (a) such an agreement can be extended to apply to the rights of rightholders who have not authorised that collective management organisation to represent them by way of assignment, licence or any other contractual arrangement; or (b) with respect to such an agreement, the organisation has a legal mandate or is presumed to represent rightholders who have not authorised the organisation accordingly. Member States shall ensure that the licensing mechanism referred to in paragraph 1 is only applied within well-defined areas of use, where obtaining authorisations from rightholders on an individual basis is typically onerous and impractical to a degree that makes the required licensing transaction unlikely, due to the nature of the use or of the types of works or other subject matter concerned, and shall ensure that such licensing mechanism safeguards the legitimate interests of rightholders. For the purposes of paragraph 1, Member States shall provide for the following safeguards: (a) the collective management organisation is, on the basis of its mandates, sufficiently representative of rightholders in the relevant type of works or other subject matter and of the rights which are the subject of the licence, for the relevant Member State; (b) all rightholders are guaranteed equal treatment, including in relation to the terms of the licence; (c) rightholders who have not authorised the organisation granting the licence may at any time easily and effectively exclude their works or other subject matter from the licensing mechanism established in accordance with this Article; and (d) appropriate publicity measures are taken, starting from a reasonable period before the works or other subject matter are used under the licence, to inform rightholders about the ability of the collective management organisation to license works or other subject matter, about the licensing taking place in accordance with this Article and about the Keller, ‘Explainer’, note 199.

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4.

5.

6.

options available to rightholders as referred to in point (c). Publicity measures shall be effective without the need to inform each rightholder individually. This Article does not affect the application of collective licensing mechanisms with an extended effect in accordance with other provisions of Union law, including provisions that allow exceptions or limitations. This Article shall not apply to mandatory collective management of rights. Article 7 of Directive 2014/26/EU shall apply to the licensing mechanism provided for in this Article. Where a Member State provides in its national law for a licensing mechanism in accordance with this Article, that Member State shall inform the Commission about the scope of the corresponding national provisions, about the purposes and types of licences that may be introduced under those provisions, about the contact details of organisations issuing licences in accordance with that licensing mechanism, and about the means by which information on the licensing and on the options available to rightholders as referred to in point (c) of paragraph 3 can be obtained. The Commission shall publish that information. Based on the information received pursuant to paragraph 5 of this Article and on the discussions within the contact committee established in Article 12(3) of Directive 2001/ 29/EC, the Commission shall, by 10 April 2021, submit to the European Parliament and to the Council a report on the use in the Union of the licensing mechanisms referred to in paragraph 1 of this Article, their impact on licensing and rightholders, including rightholders who are not members of the organisation granting the licences or who are nationals of, or resident in, another Member State, their effectiveness in facilitating the dissemination of cultural content, and their impact on the internal market, including the cross-border provision of services and competition. That report shall be accompanied, if appropriate, by a legislative proposal, including as regards the cross-border effect of such national mechanisms.

I. COMMENTARY 17.209 The Directive has as its main aim to strike a fair balance between the interests of on the one hand the creator and the copyright holder and on the other hand the users of copyright works. Article 12 tries to fulfil this aim by granting Member States the option to introduce provisions to facilitate collective licensing by giving it extended effect. The creator will be remunerated more easily and the user gets access to all works in a certain area and no longer has to worry about whether a certain work is part of the repertoire of a certain CMO.206 Before entering into more detail, one should focus on the fact that Article 12 is an optional ‘may’ provision. Member States are not obliged to implement it. 17.210 The model for Article 12 is the extended collective licensing model that has been operating in the Nordic countries for just over half a century.207 In the version retained in Article 12 the licence agreement entered into by a CMO can be extended to include the rights of rightholders who have not authorised the CMO to represent them.208 The extension is limited to use in the territory of the Member State that legislated to make the extension possible. It is also possible for the CMO to be given a legal mandate in this respect or to be presumed to represent rightholders who have not

206 207

208

See also V. Verronen, ‘Extended Collective License in Finland: A Legal Instrument for Balancing the Rights of the Author with the Interests of the User’ (2002) Journal of the Copyright Society of the USA 1149. Th. Riis and J. Schovsbo, ‘Extended Collective Licenses and the Nordic Experience: It’s a Hybrid but Is It a Volvo or a Lemon’ (2009–2010) 33 Colum. J.L. & Arts 471 and A. Strowel, ‘The European Extended Collective Licensing Model’ (2010–2011) 34 Colum. J.L. & Arts 665. Directive 2019/790, Art. 12(1).

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authorised it to represent them (‘presumption of representation’). The CMO must be a CMO that is subject to the rules implementing the CRM Directive.209 It is not our intention to go into the definition of a CMO once more here, but it is clear that it includes the concept that these organisations have collective management as its sole or main purpose. Recital 49 adds that the mechanism in Article 12 is limited to CMOs that comply with the requirements of the CRM Directive, which seems to indicate that the intention of the legislator was to rule out the option for Member States to go beyond the provisions of the Directive on this point. This may complicate matters e.g., in Sweden where trade unions have also been managing rights collectively.210 But paragraph (4)211 adds explicitly that extended collective licensing mechanisms that are based on other provisions of EU law are left unaffected and that these provisions include provisions on exceptions and limitations. And the provision on the rights of rightholders, who are not members of the CMO, will apply.212 Paragraph (2) adds that the licensing with extended effect mechanism shall only be applied within 17.211 well-defined areas of use, rather than e.g., to all copyright works, and that obtaining authorisations from individual rightholders must be typically onerous and impractical in such an area. An example that comes to mind immediately is that of songs and records for radio stations. In those cases the conclusion of individual agreements becomes unlikely due to the nature of the works or the types of works or other subject matter. Member States are also told to ensure that the licensing mechanism safeguards the legitimate interests of the rightholders. The latter makes one think of the three-step test, but it is important to note that there is no mention that the test may apply here. The legislator sidesteps here the academic discussion whether an extended collective licensing mechanism amounts in practice to an exception of limitation to the benefit of the user, whose use of the works covered by the extended effect will not amount to an infringement despite the absence of an explicit authorisation213 by the copyright holder.214 The alternative view is to see extended collective licensing merely as arrangements concerning the management of rights.215 Rather than on the benefit for the user (the exception point) the focus is then on the licence and its scope. The user is covered by the licence and the interest of the copyright holder is covered by the safeguards that are built in. Paragraph (3) adds additional safeguards.216 First of all, the CMO must be sufficiently representa- 17.212 tive of rightholders in the relevant type of works or subject matter and in relation to the rights that are licensed in the Member State concerned.217 This fits in with the idea that the licence is merely

209

210

211 212

213 214

215

216 217

Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market [2014] OJ L 84/72. J. Axhamn, ‘The New Copyright Directive: Collective licensing as a way to strike a fair balance between creator and user interests in copyright legislation (Article 12)’, Kluwer Copyright Blog, http://copyrightblog.kluweriplaw.com/2019/ 06/25/the-new-copyright-directive-collective-licensing-as-a-way-to-strike-a-fair-balance-between-creator-and-userinterests-in-copyright-legislation-article-12/?doing_wp_cron=1590486428.5646700859069824218750. Directive 2019/790, Art. 12(4). Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market [2014] OJ L 84/72, Art. 7. See Case C-301/15 Marc Soulier and Sara Doke v. Premier ministre and Ministre de la Culture et de la Communication ECLI:EU:C:2016:878. J. Axhamn and L. Guibault, ‘Cross-Border Extended Collective Licensing: A Solution to Online Dissemination of Europe’s Cultural Heritage’, Amsterdam Law School Research Paper No. 2012-22. Available at SSRN: https:// ssrn.com/abstract=2001347. Verronen, note 206. J. Axhamn, ‘Exceptions, limitations and collective management of rights as vehicles for access to information’, in Dana Beldiman (ed), Access to Information and Knowledge: 21st Century Challenges in Intellectual Property and Knowledge Governance (Edward Elgar Publishing, 2013), pp. 164–86. Axhamn, note 210. Recital 48 of Directive 2019/790 leaves this to the Member States to determine.

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extended to offer complete coverage. The repertoire of the CMO covers most of the rights and authors and the extension covers the additional bits. Secondly, all rightholders need to be treated equally, whether they are members of the CMO or whether they merely get involved through the extension. Thirdly, there is the fundamentally important option for the rightholder brought in via the extended effect to opt out and to exclude his or her works from the licensing mechanism. That allows the system to comply with the concept that the authorisation of the rightholder remains of capital importance.218 And fourthly, rightholders must be informed about the mechanism in advance, but these publicity measures can be effective without there being a need to inform each rightholder individually.219 Such information will also enable the rightholder to opt out in a timely manner, should he or she wish to do so.220 The information and the publicity measures should be effective throughout the duration of the licence and should not put a disproportionate administrative burden on any of the parties.221 17.213 Finally, paragraphs (5) and (6) put in place reporting obligations. Member States that use the mechanism shall inform the Commission and provide details of their implementation, which the Commission will then in turn publish. And the Commission will report to the Parliament and the Council on the use of the licensing mechanisms with extended effect by 10 April 2021. Crucially, that report shall include a legislative proposal as regards the cross-border effect of such national mechanism.

NOTES 1. Related instruments Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market [2014] OJ L 84/72.

2. CJEU case law Case C-301/15 Marc Soulier and Sara Doke v. Premier ministre and Ministre de la Culture et de la Communication ECLI:EU:C:2016:878.

3. Bibliography Axhamn, J., ‘The New Copyright Directive: Collective licensing as a way to strike a fair balance between creator and user interests in copyright legislation (Article 12)’, Kluwer Copyright Blog, http://copyrightblog.kluweriplaw.com/ 2019/06/25/the-new-copyright-directive-collective-licensing-as-a-way-to-strike-a-fair-balance-between-creatorand-user-interests-in-copyright-legislation-article-12/?doing_wp_cron=1590486428.5646700859069824218750. Axhamn, J. and L. Guibault, ‘Cross-Border Extended Collective Licensing: A Solution to Online Dissemination of Europe’s Cultural Heritage’, Amsterdam Law School Research Paper No. 2012-22. Available at SSRN: https:// ssrn.com/abstract=2001347. Axhamn, J., ‘Exceptions, limitations and collective management of rights as vehicles for access to information’, in Dana Beldiman (ed), Access to Information and Knowledge: 21st Century Challenges in Intellectual Property and Knowledge Governance (Edward Elgar Publishing, 2013), pp. 164–86. Riis, Th. and J. Schovsbo, ‘Extended Collective Licenses and the Nordic Experience: It’s a Hybrid but Is It a Volvo or a Lemon’ (2009–2010) 33 Colum. J.L. & Arts 471. Strowel, A., ‘The European Extended Collective Licensing Model’ (2010–2011) 34 Colum. J.L. & Arts 665.

218 219 220 221

Case C-301/15 Marc Soulier and Sara Doke. Axhamn, note 210. Cf. Case C-301/15 Marc Soulier and Sara Doke. Directive 2019/790, Recital 48.

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ARTICLE 13: NEGOTIATION MECHANISM Verronen, V., ‘Extended Collective License in Finland: A Legal Instrument for Balancing the Rights of the Author with the Interests of the User’ (2002) Journal of the Copyright Society of the USA 1149.

CHAPTER 3 ACCESS TO AND AVAILABILITY OF AUDIOVISUAL WORKS ON VIDEO-ON-DEMAND PLATFORMS ARTICLE 13: NEGOTIATION MECHANISM Member States shall ensure that parties facing difficulties related to the licensing of rights when seeking to conclude an agreement for the purpose of making available audiovisual works on video-on-demand services may rely on the assistance of an impartial body or of mediators. The impartial body established or designated by a Member State for the purpose of this Article and mediators shall provide assistance to the parties with their negotiations and help the parties reach agreements, including, where appropriate, by submitting proposals to them. Member States shall notify the Commission of the body or mediators referred to in the first paragraph no later than 7 June 2021. Where Member States have chosen to rely on mediation, the notification to the Commission shall at least include, when available, the source where relevant information on the mediators entrusted can be found.

I. COMMENTARY The starting point for the ‘new’ Article 13 that replaced the much discussed ‘old’ Article 13 that 17.214 became Article 17 is the fairly obvious realisation that video-on-demand services and platforms will play an increasingly important role in the dissemination of audiovisual works in the European Union. But that realisation is to be contrasted with the fact that the availability of these works, and in particular of European works, on video-on-demand services remains limited.222 Platforms and services find it difficult to conclude the necessary licensing agreements. Rightholders in certain territories may not be very keen on online exploitation, as they see little economic incentive for them, and if they do not license the work it cannot be made available on on-demand services or platforms. Windows of exploitation may also be different in different Member States, which also complicates cross-border on-demand services.223 Article 13 responds to this situation by instructing the Member States to put in place a negotiation 17.215 mechanism that allows parties willing to conclude an agreement to rely on the assistance of an impartial body or of one or more mediators.224 Such an impartial body or mediator will assist a willing party to negotiate and conclude a licence agreement with the relevant rightholders. These can be newly created, but they can also be existing ones. There can be multiple bodies or mediators that parties can use, and parties can pick the Member State in which they want to make use of the mechanism. Member States remain free to decide on the specific functioning of the negotiation mechanism, 17.216 including the timing and duration of the assistance to negotiations and the bearing of the costs. But

222 223 224

Ibid., Recital 51. M. Kivistö, ‘The DSM Directive: A Package (too) Full of Policies’, in T. Pihlajarinne, J. Vesala and O. Honkkila (eds), Online Distribution of Content in the EU (Edward Elgar Publishing, 2019), at 15. S. F. Schwemer, Licensing and Access to Content in the European Union: Regulation between Copyright and Competition Law (Cambridge University Press, 2019), at 171.

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Member States should ensure that administrative and financial burdens remain proportionate to guarantee the efficiency of the negotiation mechanism.225 A list of the bodies or mediators needs to be notified to the Commission.

NOTES 1. Bibliography Kivistö, M., ‘The DSM Directive: A Package (too) Full of Policies’, in T. Pihlajarinne, J. Vesala and O. Honkkila (eds), Online Distribution of Content in the EU (Edward Elgar Publishing, 2019), 5. Schwemer, S. F., Licensing and Access to Content in the European Union: Regulation between Copyright and Competition Law (Cambridge University Press, 2019).

CHAPTER 4 WORKS OF VISUAL ART IN THE PUBLIC DOMAIN ARTICLE 14: WORKS OF VISUAL ART IN THE PUBLIC DOMAIN Member States shall provide that, when the term of protection of a work of visual art has expired, any material resulting from an act of reproduction of that work is not subject to copyright or related rights, unless the material resulting from that act of reproduction is original in the sense that it is the author’s own intellectual creation.

I. COMMENTARY 17.217 We have all had the experience of going to a museum and liking a work of visual art, such as a sculpture or a painting, so much that we wanted to buy a faithful reproduction of it in the museum shop. Even if the copyright in the work of visual art has long expired, the reproduction, be it e.g., a postcard or a poster, often comes with a copyright notice covering the reproduction, i.e., often the photograph by means of which the work has been reproduced faithfully. But ‘[i]n the field of visual arts, the circulation of faithful reproductions of works in the public domain contributes to the access to and promotion of culture, and the access to cultural heritage’, according to Recital 53. In other words, the public needs the faithful reproduction to have access to the work and through it to cultural heritage and whilst the fact that the work of visual art is in the public domain should assist in this respect the fact that copyright may exist in the reproduction brings back a hurdle by effectively taking access to the work again out of the public domain.226 And as the Recital adds ‘[i]n the digital environment, the protection of such reproductions through copyright or related rights is inconsistent with the expiry of the copyright protection of works’.227 17.218 To address this problem Article 14 repeats in practice first of all that a work of visual art can be reproduced, communicated to the public or used otherwise without the authorisation of the author once the copyright in the work has expired. But in addition, no copyright shall continue to be attached to a faithful reproduction of such a work of visual art that is in the public domain. Article 14 states this in a somewhat clumsy way, but this is what it boils down to. The no copyright for faithful reproductions point covers copyright in the sense in which it is used in e.g., the Copyright,

225 226

227

Directive 2019/790, Recital 52. European Copyright Society, Comment of the European Copyright Society on the Implementation of Art. 14 of the Directive (EU) 2019/790 on Copyright in the Digital Single Market, https://europeancopyrightsocietydotorg. files.wordpress.com/2020/04/ecs_cdsm_implementation_article_14_final.pdf. Recital 53 to Directive 2019/790.

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Designs and Patents Act 1988 in the United Kingdom, which means that it comprises both copyright proper and related rights. It does in other words also stop the application of mechanisms such as the one found in Article 72 of the German Copyright Act228 that put in place a weaker regime of protection for non-original photographs. That German provision was indeed held by the Bundesgerichtshof to apply to photographs of paintings or other two-dimensional works that faithfully reproduce these works.229 Importantly, it was held that this protection applied irrespective of whether the work that is photographed is in the public domain or is still protected by copyright. It can therefore impede access to works that are in the public domain and this was seen to be unacceptable. The case may therefore explain why Article 14, which was not contained in the original draft Directive, made its appearance at a relatively late stage.230 We will return to this point later, but it is worth pointing out that Article 6 of the Term Directive,231 whilst not harmonising it, leaves open the door for these alternative regimes of protection for non-original photographs. Article 14 DSM Directive does not abrogate that provision, it merely puts a restriction on it in relation to works of visual art.232 Related rights for non-original photographs are the main target of Article 14, but other related rights are of course also affected if they cover reproductions of works of visual art. One could think of rights covering non-original audiovisual recordings for example.233 Article 14 applies exclusively to faithful reproductions and the text of the article is clearly stating 17.219 that copyright will continue to exist for any reproduction (of a work of visual art) that is original in the sense that it is the author’s own intellectual creation. In other words, reproductions that pass the originality test as laid down in the Infopaq case234 will remain protected by copyright.235 The Court of Justice of the European Union explained this to mean that ‘[i]n order for an intellectual creation to be regarded as an author’s own it must reflect the author’s personality, which is the case if the author was able to express his creative abilities in the production of the work by making free and creative choices’.236 One could therefore see Article 14 as a mere clarification of the standard of originality laid down in Infopaq, but maybe it goes a little bit further and codifies (within its limited scope of works affected) the point in the case law of the court that copyright only arises when a work is sufficiently original in the sense of the Infopaq doctrine.237 In any case ‘original’ reproductions will be copyright protected and will not be affected by Article 14. Despite the fact that Article 14 talks about copyright and related rights in faithful reproductions no longer existing the practical result is that mainly the related rights will be affected.238

228 229 230 231 232 233 234 235

236

237 238

Urheberrechtsgesetz – UrhG, https://www.gesetze-im-internet.de/englisch_urhg/. Case I ZR 104/17 Museumsfotos, German Federal Supreme Court (Bundesgerichtshof), 20 December 2018, http:// juris.bundesgerichtshof.de/cgibin/rechtsprechung/document.py?Gericht=bgh&Art=en&nr=92142&pos=0&anz=1. European Copyright Society, note 226. Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights (codified version) [2006] OJ L 372/12. E. Rosati, DSM Directive Series #3: How far does Article 14 go?, IPKat, http://ipkitten.blogspot.com/2019/04/dsmdirective-series-3-how-far-does.html. European Copyright Society, note 226. Case C-05/08 Infopaq International A/S v. Danske Dagblades Forening ECLI:EU:C:2009:465. For an example in relation to photographs, see Cour de Cassation (France), Cass. 1ère civ. 11 mai 2017, n°15-29.374, ECLI:FR:CCASS:2017:C100563, https://www.legifrance.gouv.fr/affichJuriJudi.do?oldAction=rechJuriJudi&idTexte= JURITEXT000034705564&fastReqId=441085215&fastPos=1. Case C-469/17 Funke Medien NRW GmbH v. Bundesrepublik Deutschland ECLI:EU:C:2019:623, para. 17 and Case C-145/10 Eva-Maria Painer v. Standard VerlagsGmbH, Axel Springer AG, Süddeutsche Zeitung GmbH, Spiegel-Verlag Rudolf Augstein GmbH & Co KG, Verlag M. DuMont Schauberg Expedition der Kölnischen Zeitung GmbH & Co KG ECLI:EU:C:2011:798, paras 87–89. Rosati, note 232. European Copyright Society, note 226.

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17.220 The Term Directive239 created another set of rights that may be affected by Article 14. Article 5 Term Directive allows Member States to protect critical and scientific publications of works which have come into the public domain. These works could be works of visual arts and these publications could cover works of visual arts, but it is hard to see how Article 5 Term Directive could be affected, as these ‘critical and scientific’ publications are very likely to pass the originality threshold. At best such a publication cannot create copyright in the faithful reproduction of the work of visual art that is part of the critical and scientific publication. But the latter is clearly a work and one that involves originality. The protection it gets therefore deserves its place in copyright. That cannot be said about Article 4 Term Directive and its protection for previously unpublished works that are published once copyright has expired. What is created by Article 4 is not a copyright, nor a related right in the ‘copyright’ sense. Article 4 calls it explicitly ‘a protection equivalent to the economic rights of the author’. A protection that excludes moral rights, that has its own specific (shorter) term of protection and that runs in parallel with part of copyright is not copyright. Originality is clearly not present here and is not required. In application of the Infopaq doctrine there is therefore no work for which copyright protection can arise. Article 14 DSM is limited to copyright and related rights and does therefore not apply here. There is also a very good policy reason for this. Article 4 was introduced to encourage people to publish previously unpublished works and make them available to the public. Public access being a ground for Article 14 it would be counterproductive if it abolished the right stimulating the provision of access to previously unpublished works and there is no reason why works of visual art would be different on this point.240 17.221 There is, however, a second definition that is crucial in relation to Article 14 DSM Directive, apart from the definition of an original reproduction that is not affected by it (in contrast with the faithful reproductions to which it applies). Article 14 is after all limited to reproductions of works of visual arts. How does one define works of visual art? The Directive itself does not offer a definition and neither does any other Directive. Article 2(1) Berne Convention241 does not even use the words ‘work of visual arts’, although it includes a wide list of examples that could be said to be part of the category of works of visual art: drawings, paintings, sculptures, engravings, lithography and works of architecture, but also photographic works and works of applied art, maps and sketches. Member States also do not have a unique concept of works of visual arts and some of the examples above form a separate category in some national copyright laws, whilst other national laws include them in the category of works of visual art. But if Recital 53 is right in pointing towards an aim of access to cultural heritage and access and promotion of culture a wide definition seems to fit in best and Member States are encouraged to go down that path when transposing the Directive into national law. Anything that is perceived visually and that meets the originality criterion should be covered. It is after all in relation to these works that reproductions could be protected even if they are mere faithful reproductions.242 That is not possible in relation to e.g., literary works where an exact copy of an out of copyright work will never attract a new copyright. The faithfulness of the reproduction is therefore the main criterion, rather than the concept of a work of visual art. And any wide definition of the latter in the context of Article 14 will in any case not reduce the copyright protection for original reproductions. 17.222 It is also important to note that these faithful reproductions can be both 2D and 3D reproductions. 3D prints or plaster casts of three-dimensional works are after all not by definition transformative or creative. Article 14 also applies to digital, as well as to analogue reproductions. But Article 14 does require a copyright or related right that has expired and does therefore not apply to faithful

239 240 241 242

Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights (codified version) [2006] OJ L 372/12. Compare: European Copyright Society, note 226. Berne Convention 1886, https://wipolex.wipo.int/en/text/283698. European Copyright Society, note 226.

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reproductions of works from antiquity and other works that pre-date the creation of copyright laws. But the aims of Recital 53 apply to those works and their reproduction too and Member States are therefore encouraged to include these in their national implementation.243 That leaves us with the question of when Article 14 will come into operation. The text of Article 14 17.223 is not crystal clear on this point, but things become clearer if one looks at Recital 53 and its aim of providing access.244 That access is coupled with the fact that the work of visual art enters the public domain at a certain moment in time. Most works of visual art exist in a single or limited number of copies and access therefore requires or is at least substantially enhanced by reproductions of the work. The absence of protection by copyright of related rights for faithful reproductions only therefore makes sense if it comes in at the same time, i.e., when the underlying work of visual art enters the public domain. Existing faithful reproductions will see their term of protection end and new faithful reproductions will not attract protection altogether. One could alternatively suggest that Article 14 would only apply to new faithful reproductions that are made after the underlying work of visual art enters the public domain, but this interpretation is to be rejected, as it would significantly undermine the aims expressed in Recital 53.245 Galleries, museums and other institutions that have works of visual art in their collections will of course still be able to offer via their web-shops high-quality faithful reproductions of these works and price these accordingly.246 Article 14 will merely restrict the copyright and related rights protection and once acquired these reproductions can therefore be used freely unless one has agreed to contractual restrictions on their use.

NOTES 1. Related instruments Berne Convention 1886. Directive 2006/116/EC of the European Parliament and of the Council of 12 December 2006 on the term of protection of copyright and certain related rights (codified version) [2006] OJ L 372/12.

2. CJEU case law / national case law Case C-05/08 Infopaq International A/S v. Danske Dagblades Forening ECLI:EU:C:2009:465. Case C-145/10 Eva-Maria Painer v. Standard VerlagsGmbH, Axel Springer AG, Süddeutsche Zeitung GmbH, SpiegelVerlag Rudolf Augstein GmbH & Co KG, Verlag M. DuMont Schauberg Expedition der Kölnischen Zeitung GmbH & Co KG ECLI:EU:C:2011:798. Case C-469/17 Funke Medien NRW GmbH v. Bundesrepublik Deutschland ECLI:EU:C:2019:623. Case I ZR 104/17 Museumsfotos, German Federal Supreme Court (Bundesgerichtshof), 20 December 2018, http://juris.bundesgerichtshof.de/cgi-bin/rechtsprechung/document.py?Gericht=bgh&Art=en&nr=92142&pos=0 &anz=1 . Cour de Cassation (France), Cass. 1ère civ. 11 mai 2017, n°15-29.374, ECLI:FR:CCASS:2017:C100563, https:// www.legifrance.gouv.fr/affichJuriJudi.do?oldAction=rechJuriJudi&idTexte=JURITEXT000034705564&fastReq Id=441085215&fastPos=1.

243 244 245 246

Ibid. Directive 2019/790, Recital 53. European Copyright Society, note 226. P. Torremans, ‘Presenting Best Practices for Copyright and Trademarks in Common Law Countries for Cultural Heritage and Museum Collections’, paper delivered on 11 September 2019 at WIPO Workshop on IP for Libraries/Museums at the Bibliotheca Alexandrina, Alexandria, Egypt.

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3. Bibliography European Copyright Society, Comment of the European Copyright Society on the Implementation of Art. 14 of the Directive (EU) 2019/790 on Copyright in the Digital Single Market, https://europeancopyrightsocietydotorg. files.wordpress.com/2020/04/ecs_cdsm_implementation_article_14_final.pdf. Rosati, E., DSM Directive Series #3: How far does Article 14 go?, IPKat, http://ipkitten.blogspot.com/2019/04/dsmdirective-series-3-how-far-does.html. Torremans, P., ‘Presenting Best Practices for Copyright and Trademarks in Common Law Countries for Cultural Heritage and Museum Collections’, paper delivered on 11th September 2019 at WIPO Workshop on IP for Libraries/Museums at the Bibliotheca Alexandrina, Alexandria, Egypt.

TITLE IV: MEASURES TO ACHIEVE A WELL-FUNCTIONING MARKETPLACE FOR COPYRIGHT CHAPTER 1 RIGHTS IN PUBLICATIONS ARTICLE 15: PROTECTION OF PRESS PUBLICATIONS CONCERNING ONLINE USES 1.

2.

3. 4.

5.

Member States shall provide publishers of press publications established in a Member State with the rights provided for in Article 2 and Article 3(2) of Directive 2001/29/EC for the online use of their press publications by information society service providers. The rights provided for in the first subparagraph shall not apply to private or noncommercial uses of press publications by individual users. The protection granted under the first subparagraph shall not apply to acts of hyperlinking. The rights provided for in the first subparagraph shall not apply in respect of the use of individual words or very short extracts of a press publication. The rights provided for in paragraph 1 shall leave intact and shall in no way affect any rights provided for in Union law to authors and other rightholders, in respect of the works and other subject matter incorporated in a press publication. The rights provided for in paragraph 1 shall not be invoked against those authors and other rightholders and, in particular, shall not deprive them of their right to exploit their works and other subject matter independently from the press publication in which they are incorporated. When a work or other subject matter is incorporated in a press publication on the basis of a non-exclusive licence, the rights provided for in paragraph 1 shall not be invoked to prohibit the use by other authorised users. The rights provided for in paragraph 1 shall not be invoked to prohibit the use of works or other subject matter for which protection has expired. Articles 5 to 8 of Directive 2001/29/EC, Directive 2012/28/EU and Directive (EU) 2017/1564 of the European Parliament of the Council shall apply mutatis mutandis in respect of the rights provided for in paragraph 1 of this Article. The rights provided for in paragraph 1 shall expire two years after the press publication is published. That term shall be calculated from 1 January of the year following the date on which that press publication is published. Paragraph 1 shall not apply to press publications first published before 6 June 2019. Member States shall provide that authors of works incorporated in a press publication receive an appropriate share of the revenues that press publishers receive for the use of their press publications by information society service providers.

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I. COMMENTARY 1. Background The publishers’ rights introduced by the DSM Directive came about – according to the EU – for 17.224 two basic reasons: (a) the organisational and financial contribution of publishers in producing press publications had to be recognised and further encouraged to ensure the sustainability of the publishing industry and thereby foster the availability of reliable information247 and by reason of (b) the wide availability of press publications online, which has given rise to the emergence of new online services, such as news aggregators or media monitoring services. The reuse of press publications in these cases constituted an important part of their business models and a source of revenue.248 There have been voices that publishers did not need an extra right to defend their investment since copyrights in the content were usually transferred to them by the journalists or other authors.249 Yet, for a publisher to exercise these rights he would need to prove (a) the originality of the works and (b) that a transfer of rights has taken place. Whilst the new right arises by the existence of the publishing activity alone (which also forms the reason of its recognition) it is not certain what are the exact elements of this activity that would weigh towards this end.250 Amongst the critics against this right were also whether it will create barriers for new news aggregators/media monitoring services to enter the market since the cost of entering will be increased as well as whether smaller enterprises in this respect will be forced to shut down and give leeway to big players. In this manner access to information will be restricted.251 Already some EU Member States have taken legislative action before the introduction of this 17.225 article, which in some cases was either not considered effective (e.g., in Spain)252 or was not fully compliant with EU law (e.g., Germany).253

247 248 249

250 251 252

253

Recital 55. Recital 54. C. Geiger, G. Frosio and O. Bulayenko (2017), CEIPI Opinion on the European Commission’s Proposal to Reform Copyright Limitations and Exceptions in the European Union, CEIPI Research Paper No. 2017-9; R. Hilty and V. Moscon, Modernisation of the EU Copyright Rules Position Statement of the Max Planck Institute for Innovation and Competition, Max Planck Institute for Innovation & Competition Research Paper No. 17-12, SSRN Papers https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3036787; Th. Dreier, in Dreier and Schulze, UrhG, 6. Aufl. §87f Rn. 4, Suwelack, MMR 2018, 583; L. Bently et al., Response to Article 11 of the Proposal for a Directive on Copyright in the Digital Single Market, entitled ‘Protection of press publications concerning digital uses’ on behalf of 37 professors and leading scholars of Intellectual Property, Information Law and Digital Economy (5 December 2016): https:// www.cipil.law.cam.ac.uk/press/news/2016/12/cambridge-academics-respond-call-views-european-commissions-draftlegislation. M. Stieper, ZUM (2019), 213; Th. Ackermann, ZUM (2019), 375. M. Ricolfi, Raquel Xalabarder, Mireille van Eechoud (2018), Academics against Press Publishers’ Right, Statement from 169 EU academics: https://www.ivir.nl/academics-against-press-publishers-right/. See art. 32 of the Spanish Intellectual Property Law (Real Decreto Legislativo 1/1996, de 12 de abril, por el que se aprueba el texto refundido de la Ley de Propiedad Intelectual, regularizando, aclarando y armonizando las disposiciones legales vigentes sobre la materia) https://www.boe.es/buscar/act.php?id=BOE-A-1996-8930. See ss 87f, 87g and 87h of the German Copyright Act (Copyright Act of 9 September 1965 (Federal Law Gazette I, p. 1273), as last amended by Article 1 of the Act of 28 November 2018 (Federal Law Gazette I, p. 2014)) https://www.gesetze-im-internet.de/englisch_urhg/englisch_urhg.html. See also Case C-299/17, VG Media Gesellschaft zur Verwertung der Urheber- und Leistungsschutzrechte von Medienunternehmen mbH v. Google LLC, Judgment of the Court (Fourth Chamber) of 12 September 2019, ECLI:EU:C:2019:716. The dictum was that: Article 1(11) of Directive 98/34/EC of the European Parliament and of the Council of 22 June 1998 laying down a procedure for the provision of information in the field of technical standards and regulations and of rules on Information Society services (as amended by Directive 98/48/EC of the European Parliament and of the Council of 20 July 1998), must be interpreted as meaning that a provision of national law, such as that at issue in the main proceedings, which prohibits only commercial operators of search engines and commercial service providers that similarly publish content from making newspapers or magazines or parts thereof (excluding individual words and very

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17.226 At the same time the Court of Justice’s case law concerning publishers and remuneration under the exception for reproduction for private purposes, which left publishers out of the spectrum of those to be necessarily compensated254 created a turbulence that had to be somehow balanced. In its Impact Assessment255 the European Commission referred to the fact that a number of Member States had already ‘intervened to remedy or reduce – whether by means of ad hoc initiatives or as part of broader arrangements – the negative impact of reduced revenue in the press publishing sector’. Such copyright-related initiatives have included: + + + + +

the introduction of neighbouring rights (as happened in Germany); provisions on collective works; provisions on presumption of transfer; copyright protection of the typographical arrangement of published editions; and mandatory fair compensation requirements (as is the case in Spain).

Focusing specifically on the German and Spanish experiences, the Impact Assessment itself acknowledged that these had been somewhat ‘ineffective’ and linked such ineffectiveness to ‘the lack of scale of national solutions ’.256 17.227 In addition, a harmonised legal approach at EU level was considered to help publishers of press publications that face problems in licensing the online use of their publications to the providers of those kinds of services, to recoup their investments. The absence of such a right would render the licensing and enforcement of rights in press publications regarding online uses by information society service providers in the digital environment, complex and inefficient.257 17.228 France was the first EU Member State to implement Article 15, which became effective on 25 October 2019.258 ‘Google immediately announced that it had no intention of paying any remuneration whatsoever to press publishers, and decided unilaterally that it would no longer display article extracts, photographs, infographics and videos within its various services (Google Search, Google News and Discover), unless the publishers granted the authorisation free of charge. Google claimed that this decision complied with the new copyright law.259 In response publishers filed a successful

short text excerpts) available to the public, constitutes a ‘technical regulation’ within the meaning of that provision, the draft of which is subject to prior notification to the Commission pursuant to the first subparagraph of Article 8(1) of Directive 98/34, as amended by Directive 98/48.

254 255

256 257 258

259

See also J. B. Nordemann and S. Jehle (Nordemann), ‘VG Media/Google: German press publishers’ right declared unenforceable by the CJEU for formal reasons – but it will soon be re-born’, Kluwer Copyright Blog, November 11, 2019 . C-572/13, Hewlett-Packard Belgium SPRL v Reprobel SCRL, Judgment of the Court (Fourth Chamber) of 12 November 2015, ECLI:EU:C:2015:750. Commission Staff Working Document Impact Assessment on the modernisation of EU copyright rules. Accompanying the document Proposal for a Directive of the European Parliament and of the Council on copyright in the Digital Single Market and Proposal for a Regulation of the European Parliament and of the Council laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes {COM(2016) 593} {COM(2016) 594} {SWD(2016) 302}, Brussels, 14.9.2016 SWD(2016) 301 final. Rosati, note 232 and Impact Assessment, ibid., p. 161. Recital 54. LOI n° 2019-775 du 24 juillet 2019 tendant à créer un droit voisin au profit des agences de presse et des éditeurs de presse, JORF n° 0172 du 26 juillet 2019, Texte n° 4 . B. Spitz, ‘Press Publishers’ Right: the French Competition Authority orders Google to negotiate with the publishers’, 14 April 2020 http://copyrightblog.kluweriplaw.com/2020/04/14/press-publishers-right-the-french-competitionauthority-orders-google-to-negotiate-with-the-publishers/?doing_wp_cron=1592384978.3135180473327636718750.

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request for an injunction against Google before the French Competition Authority, which published its Decision on 9 April 2020.260

2. The notion of ‘publishers of press publications’ According to the Directive ‘press publication’ covers journalistic publications, published in any 17.229 media, including on paper, in the context of an economic activity that constitutes a provision of services under Union law. The press publications that are covered include (but are not limited to) daily newspapers, weekly or monthly magazines of general or special interest, including subscription-based magazines, and news websites. Press publications contain mostly literary works, but increasingly include other types of works and other subject matter, in particular photographs and videos. Periodical publications published for scientific or academic purposes, such as scientific journals, are not covered. Neither are websites, such as blogs, that provide information as part of an activity that is not carried out under the initiative, editorial responsibility and control of a service provider, such as a news publisher.261 In broad terms one could argue that the new right is a B2B right, since it leaves out non-professional and private activity.262 The definition of ‘press publications’ in this Directive should not affect definitions found in the 17.230 national laws of the EU Member States as it is made clear that this definition is ‘for the purposes of this Directive’ alone.263 The concept of publisher of press publications covers service providers, such as news publishers or 17.231 news agencies, when they publish press publications as described above.264 Only publishers established in a Member State and having their registered office, central adminis- 17.232 tration or principal place of business within the Union are covered.265 Although it is not expressly provided, it can be argued that also companies or firms that have only a registered office in the EU and whose operations are genuinely linked on an ongoing basis with the economy of a Member State are also covered consistently by Article 11(2) of the Database Directive.

3. The rights granted Publishers of press publications (established in a Member State) are provided with the rights of 17.233 reproduction and making available to the public (Arts 2 and 3(2) of Directive 2001/29/EC) of their press publications in respect of online uses by information society service providers. Information society service means a service within the meaning of point (b) of Article 1(1) of 17.234 Directive (EU) 2015/1535 of 9 September 2015 (laying down a procedure for the provision of information in the field of technical regulations and of rules on information society services). According to this, ‘service’ means any information society service, that is to say, any service normally provided for remuneration, at a distance, by electronic means and at the individual request of a recipient of services. For the purposes of this definition: (i) ‘at a distance’ means that the service is provided without the parties being simultaneously present; (ii) ‘by electronic means’ means that the 260

261 262 263 264 265

Autorité de la Concerrence, Décision n°20-MC-01 du 9 avril 2020 relative à des demandes de mesures conservatoires présentées par le Syndicat des éditeurs de la presse magazine, l'Alliance de la presse d’information générale e.a.et l’Agence France-Presse https://www.autoritedelaconcurrence.fr/sites/default/files/integral_texts/2020-04/20mc01.pdf. Recital 56. Especially if seen in conjunction with the notion of an ‘information society service’ under Art. 1(1)(b) of Directive (EU) 2015/1535 of 9 September 2015. Recital 56. Recital 55. Ibid.

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service is sent initially and received at its destination by means of electronic equipment for the processing (including digital compression) and storage of data, and entirely transmitted, conveyed and received by wire, by radio, by optical means or by other electromagnetic means; (iii) ‘at the individual request of a recipient of services’ means that the service is provided through the transmission of data on individual request. Annex I of the Directive266 provides for an indicative list of services not covered by this definition.267

4. Express exclusions 17.235 The rights granted do not apply to private or non-commercial uses of press publications by individual users. Thus, these uses remain unaffected (i.e., existing Union rules apply), including instances where individual users share press publications online.268 17.236 Nothing also changes with regard to acts of hyperlinking. The Court of Justice’s case law in this area remains unaffected, whilst hyperlinks are allowed under the relevant prescribed law conditions and requirements.269

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Annex I: Indicative list of services not covered by the second subparagraph of point (b) of Article 1(1) 1. Services not provided ‘at a distance’ Services provided in the physical presence of the provider and the recipient, even if they involve the use of electronic devices: (a) medical examinations or treatment at a doctor’s surgery using electronic equipment where the patient is physically present; (b) consultation of an electronic catalogue in a shop with the customer on site; (c) plane ticket reservation at a travel agency in the physical presence of the customer by means of a network of computers; (d) electronic games made available in a video arcade where the customer is physically present. 2. Services not provided ‘by electronic means’ — services having material content even though provided via electronic devices: (a) automatic cash or ticket dispensing machines (banknotes, rail tickets); (b) access to road networks, car parks, etc., charging for use, even if there are electronic devices at the entrance/exit controlling access and/or ensuring correct payment is made, — offline services: distribution of CD-ROMs or software on diskettes, — services which are not provided via electronic processing/inventory systems: voice telephony services; telefax/telex services; (c) services provided via voice telephony or fax; (d) telephone/telefax consultation of a doctor; (e) telephone/telefax consultation of a lawyer; (f) telephone/telefax direct marketing. 3. Services not supplied ‘at the individual request of a recipient of services’ Services provided by transmitting data without individual demand for simultaneous reception by an unlimited number of individual receivers (point to multipoint transmission): (a) television broadcasting services (including near-video on-demand services), covered by point (e) of Article 1(1) of Directive 2010/13/EU; (b) radio broadcasting services; (c) (televised) teletext.

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The notion of ‘information society service’ is also clarified in certain special cases dealt with by the Court of Justice (e.g., Judgment of 10 April 2018, Uber France, Case C-320/16, EU:C:2018:221, paras 18–28; Judgment of 20 December 2017, Asociación Profesional Elite Taxi, Case C-434/15, EU:C:2017:981, para. 48; Judgment of 20 December 2017, Falbert and Others, Case C-255/16, EU:C:2017:983, paras 27–30; Judgment of 2 February 2016, Ince, Case C-336/14, EU:C:2016:72, paras 75–76, 79, 84). Recital 55. C-466/12 Nils Svensson and Others v Retriever Sverige AB Judgment of the Court (Fourth Chamber) of 13 February 2014; C-279/13,C More Entertainment AB v Linus Sandberg; C-160/15 GS Media BV v Sanoma Media Netherlands BV, Playboy Enterprises International Inv., Britt Geertruida Dekker; C-527/15 Stichting Brein v Jack Frederik Wullems (Stichting I); C-610/15) Stichting Brein v Ziggo BV and XS4All Internet BV (Stichting II). Relevant are also Case

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The press publishers’ rights do not extend to mere facts reported in press publications since this is a 17.237 basic premise of copyright law. Also they do not apply to individual words or very short extracts of a press publication as this has been set out in the Court of Justice’s case law.270 Although the new right was meant as a related right covering publishing investment, it seems to reflect the philosophy and the reasoning of the EU criterion of originality. According to the Infopaq case271 words as such are not protected since they do not constitute elements covered by protection nor are they the intellectual creation of the author who employs them.272 It is only through the choice, sequence and combination of these words that the author may express his creativity in an original manner and achieve a result, an intellectual creation. Certain isolated sentences, or even certain parts of sentences in a text, may be suitable for conveying to the reader the originality of a publication, such as a newspaper article, by communicating to that reader an element which is, in itself, the expression of the intellectual creation of the author of that article. Such sentences or parts of sentences may therefore be protected.273 The issue that arises here is how short should the ‘very short extracts’ of press publications be. This 17.238 is not an easy answer and – on the basis of the Infopaq case – it is an answer that may vary depending on the facts of the case. Yet, the Infopaq case is relevant for copyright works only. The press publishers’ right is a related right and is thus not dependent on originality. One, of course, would wonder whether a related right can be used to de facto extend the protection of use of works (since information, facts and data are not covered) and thus limit their use by news aggregators or other type of services on the basis of ‘other’ criteria (i.e., works or other subject matter solely for being included in a press publication).274 One could argue that the scope of this provision extends into the prevention of even ‘minimal takings’ (i.e., very short extracts). The other issue is that if even 11 words (according to the Infopaq case) are capable of being copyright protected, how much shorter should a ‘very short extract’ be that its use is excluded? Recital 58 provides that ‘[t]aking into account the massive aggregation and use of press publications by information society service providers, it is important that the exclusion of very short extracts be interpreted in such a way as not to affect the effectiveness of the rights provided for in this Directive’. Bearing that in mind one could argue that any taking that brings a commercial advantage to the service provider should not be considered a very short extract. On the other hand, such an argument would defy logic since one would expect in this case that the wording of the provision should not have referred to ‘very short extracts’ but rather to any takings that are larger than individual words or to text/subject matter that

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C-360/13 Public Relations Consultants Association Ltd v The Newspaper Licensing Agency Ltd case (‘browsing’) Filmspeler Case C-527/15 and Ziggo Case C-610/15. Stamatoudi I., ‘“Linking”, “Framing” and “Browsing”. The EU Court of Justice’s recent case law’, in G Karnell, A Kur, P J Nordell, D Westman, J Axhamn, S Carlsson (eds) Liber Amicorum Jan Rosen (Eddy.se ab, Halmstad, 2016), 759; I. Stamatoudi, ‘“Linking” and “Browsing” in the light of the EU Court of Justice’s recent case law’ in T. Pistorius (ed.), IP Perspectives on the Regulation of New Technologies, ATRIP IP series, (Edward Elgar Publishing, Cheltenham (UK), Northampton (US), 2018), 179; and I. Stamatoudi, ‘“Linking”, “Framing” και “Browsing”. Προ´ σφατη Νοµολογι´α του Δικαστηρι´ου της Ευρωπαϊκη´ ς |AaΕνωσης’ (2015) 3 Δι´καιο Με´ σων Ενηµε´ ρωσης και Επικοινωνι´ας (ΔΙΜΕΕ) 349. I. Stamatoudi, ‘Originality under EU Copyright Law’ in P. Torremans (ed.), Copyright Law: A Handbook of Contemporary Research (Edward Elgar Publishing, Cheltenham (UK), Northampton (US), 2017), 57; Stamatoudi I., ‘“More” Originality for Cypriot Copyright Law according to the CJEU’s Case Law’ (Spring 2018) 30(1) The Cyprus Review 207. Case C-5/08 Infopaq International A/S v. Danske Dagblades Forening (2009), judgment of 16 July 2009 ECR I-656. Ibid., [45]–[46]. Ibid., [47]. Even the sui generis right for databases requires that substantial investment (either in terms of quality or in terms of quantity) has taken place in either the obtaining, verification or presentation of the contents. Also, only substantial takings are prevented and not any taking unless it is done repeatedly and systematically. In the case of the press publishers’ right there is no need for investment despite the fact that the notion of investment is referred to in the reasoning of this provision. See Recital 58 ‘[…] [T]he use of individual words or very short extracts of press publications by information society service providers may not undermine the investments made by publishers of press publications in the production of content’.

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is so short that – if self-standing – it does not make any sense to the reader. Any extract – no matter how short it is – it can only be considered in my view an extract (at least how this notion is used in copyright and related rights law) if one is in a position to understand that it has been extracted/ taken from a work. If it is so short that it does not make sense, it should not be considered an extract. Another criterion that needs to be taken into account is whether ‘the use of individual words or very short extracts of press publications by information society service providers may […] undermine the investments made by publishers of press publications in the production of content’275 despite the fact that investment does not form a prerequisite for this type of related right. It should also be added here that if extracts taken by service providers are so short that they do not attract copyright protection why would Recital 58 provide that rightholders are entitled to an appropriate share of the revenues that press publishers receive for the use of their press publications. Overall, one could argue that the wording of the provision is not very helpful. In any case it needs to be clarified by the Court of Justice unless practical solutions take over.276 17.239 The new press publishers’ rights are subject to the same exceptions and limitations as those provided for the other rightholders in the Information Society Directive, including the exception in the case of quotations for purposes such as criticism or review (Art. 5(3)(d) of the Information Society Directive).277 They are also subject to the exceptions for orphan works278 as well as those concerning persons who are blind, visually impaired or otherwise print-disabled.279

5. The independency of the right 17.240 The related right for press publishers leaves intact and does not affect authors and other rightholders’ rights in respect of the works (and other subject matter) incorporated in a press publication. This right should not be invoked against those authors/rightholders and it should certainly not deprive them of their right to exploit their works (and other subject matter) independently from the press publication in which they are incorporated (Art. 15(2)).280 That means that if a rightholder (e.g., a journalist) whose article has been included in a press publication is also free to grant a licence for the same article (if the contract with the initial publisher does not preclude her or him doing so, e.g., is an non-exclusive licence) to another publisher or to any entrepreneur for any type of use. The fact that the initial publisher holds a related right for the online uses of its publication does not affect the rightholder’s right as well as the service provider’s right to use extracts of this work coming from another (legal) source that allows him (either on the basis of a contract or on the basis of an exception or simply because this extract does not attract copyright protection) to use them.281

275 276 277 278 279

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Recital 58. It is very likely that platforms like Google will not take the risk and may choose to proceed with an opt-in clause, which will allow press publishers to choose whether to participate in services such as Google News. Recital 57. Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works, OJ L 299, 27.10.2012, pp. 5–12. Directive (EU) 2017/1564 of the European Parliament and of the Council of 13 September 2017 on certain permitted uses of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled and amending Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society, OJ L 242, 20.9.2017, pp. 6–13. See also Recital 59. Ibid.: Publishers of press publications should, therefore, not be able to invoke the protection granted to them under this Directive against authors and other rightholders or against other authorised users of the same works or other subject matter. That should be without prejudice to contractual arrangements concluded between the publishers of press publications, on the one hand, and authors and other rightholders, on the other.

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This related right should also not be invoked to prohibit the use of works or other subject matter for 17.241 which protection has expired and therefore are in the public domain. At this point, of course, it should be mentioned that if a press publication is protected by a sui generis right as a database, the prevention of extraction or re-use of its contents as a whole or a substantial part remains and should not affect the remainder of the rights. That means that taking a substantial extract of the database is not allowed. Yet, if one finds the same extract from another (legal source) one may extract it from there as long as it is not a press publication protected by a related right for online uses and the use at issue is, of course, an online use.

6. Authors entitled to a share of the revenues According to paragraph 5 Member States need to provide that authors of works incorporated in a 17.242 press publication receive an appropriate share of the revenues that press publishers receive for the use of their press publications by information society service providers. Recital 59 clarifies that this ‘should be without prejudice to national laws on ownership or exercise of rights in the context of employment contracts, provided that such laws are in compliance with Union law’. This provision seems to introduce a sui generis claim for remuneration since this claim is not based on the use of a creative work but rather on the basis of the exercise of a third party’s related right.282 17.243

From the above the following can be derived: 1. 2. 3.

It is only authors of works that are entitled to a share from the publishers’ revenues and no other type of rightholders (e.g., holders of related rights). Authors should necessarily get a share of revenues irrespective of whether those parts of their works that are used are original (and thus copyright protected or not).283 This share should be appropriate. ‘Appropriateness’ is another term that needs to be construed in a uniform and autonomous manner in the EU. The most recent legal instrument that refers to ‘appropriate’ remuneration (rather than share) is the Directive on collective management. Article 16(1) provides that: [r]ightholders shall receive appropriate remuneration for the use of their rights. Tariffs for exclusive rights and rights to remuneration shall be reasonable in relation to, inter alia, the economic value of the use of the rights in trade, taking into account the nature and scope of the use of the work […], as well as in relation to the economic value of the service provided by the collective management organisation.

Recital 31 (CMO Directive) also provides that tariffs ‘should be determined on the basis of objective and non-discriminatory criteria’. On the basis of the above one could argue that an appropriate share is one that is set on objective and non-discriminatory criteria as well as one that is reasonable taking into account at the same time the economic value of the use of their works in trade (if non-original parts are copied this should also be taken into account), the nature and scope of the use of the work, and the economic value of the service provided by the press publishers. 4.

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The appropriate share due to authors should be taken from the revenues that the press publishers receive. That means that authors have a claim against press publishers and not against information service providers and this claim stands only to the extent that press publishers exercise the right and get a revenue from it. It thus depends on the press publishers’ discretion to exercise their right or not.

Y. Paramythiotis, ‘The New Press Publishers Online Rights. A First Presentation, Interpretation and Assessment of Article 15 Directive 2019/790’ (2019) 2 Mass Media and Communications Law (DIMEE) 148, at 151 (in Greek). See above under section 4 the discussion whether ‘very short extracts’ are long enough to attract copyright protection or not.

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5.

6.

7. 8.

It is not clear whether this a mandatory provision or a provision from which one can contract out. Yet, it seems that the national legislator has the right to introduce it as ius cogens and also provide, if it wishes for mandatory collective management. EU Member States could also provide that it should not play a role whether the authors are the publishers/beneficiaries’ employees or not (if they introduce it as a mandatory provision). Any other approach would in essence empty the right of its substance. Whether a share is appropriate or not, will either be the subject of negotiations between authors and press publishers or will be solved by the Courts. One could also argue that it could form the subject of national regulation as the case is with the remuneration for private copying. The proviso of Recital 59 that this ‘should be without prejudice to national laws on ownership or exercise of rights in the context of employment contracts, provided that such laws are in compliance with Union law’ is not clear whether one can contract out of it or not. In the writers’ view since press publishers are the stronger party in a negotiation deal, if authors were allowed to contract out of it, this provision would be in fact emptied of substance. Thus, we may safely argue that such a claim becomes operational only if press publishers decide to exercise their rights. Yet, once they do so they are obliged to provide for an appropriate share to authors on the basis of what is provided in the national law (e.g., compulsory collective management, regulated percentage, negotiations or resolution by the courts).

7. Duration 17.244 The press publishers’ right expires two years after the press publication is published.284 That term of protection is calculated from 1 January of the year following the date on which that press publication is published. This right does not apply to press publications first published before 6 June 2019.

8. Existing schemes of remuneration for authors and publishers 17.245 The Information Society Directive gave Member States the discretion to introduce an exception to the right of reproduction for private purposes, if remuneration is paid. No specific rules were provided in this respect and for that reason there are divergences in the EU as to how this exception is implemented. The issue of private copy came before the Court of Justice in a series of cases. In one of those cases (i.e., Reprobel case)285 whether publishers are also entitled to a share of this remuneration despite the fact that they were not expressly provided for as beneficiaries in the Information Society Directive was examined. The Court of Justice came to the conclusion that: Article 5(2)(a) and Article 5(2)(b) of Directive 2001/29 preclude national legislation […] which authorises the Member State in question to allocate a part of the fair compensation payable to rightholders to the publishers of works created by authors, those publishers being under no obligation to ensure that the authors benefit, even indirectly, from some of the compensation of which they have been deprived.

Thus, the CJEU provided that since publishers are not expressly provided for in the Information Society Directive as rightholders they do not incur any damage (on the basis of this exception) as the case is with the remainder of the rightholders, such as the authors. This case has created a lot of turbulence since it reversed compensation systems in many EU Member States which included publishers as beneficiaries of such remuneration either on the basis of a statutory provision (as the case was with Greece and Belgium) or on the basis of a CMO’s distribution rules agreed between authors and publishers (as the case was with Germany). The EU tried to amend this situation.

284 285

The initial proposal was for 20 years, which was found by many EU Member States to be too long. Case C-572/13, Hewlett-Packard Belgium SPRL v Reprobel SCRL, Judgment of the Court (Fourth Chamber) of 12 November 2015, ECLI:EU:C:2015:750.

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17.246

Recital 60 of the DSM Directive recognises that: Publishers, including those of press publications, books or scientific publications and music publications, often operate on the basis of the transfer of authors’ rights by means of contractual agreements or statutory provisions. In that context, publishers make an investment with a view to the exploitation of the works contained in their publications and can in some instances be deprived of revenues where such works are used under exceptions or limitations such as those for private copying and reprography, including the corresponding existing national schemes for reprography in the Member States, or under public lending schemes. In several Member States, compensation for uses under those exceptions or limitations is shared between authors and publishers.

In this way the Directive sheds light on the issue and reverses the Court of Justice’s case law in this respect. It expressly sets out that ‘[i]n order to take account of this situation and to improve legal certainty for all parties concerned, this Directive allows Member States that have existing schemes for the sharing of compensation between authors and publishers to maintain them’. Recital 60 provides that this is particularly important for Member States that had such compensation-sharing mechanisms before 12 November 2015. That means that Member States that did not have such a regime, or that do not want to introduce one, are under no obligation to do so. The Recital further clarifies that this should not affect existing or future arrangements in Member States regarding remuneration in the context of public lending. In other words, Member States – although not obliged – are free to introduce equivalent schemes in the area of public lending, too. It is peculiar that the Court of Justice’s case law is reversed on the basis of a Recital whose binding 17.247 force from a legal point of view is disputed and which at the same time does not shed light on a Directive’s provision that is tailor-made in this respect. Yet, it is very likely that it was all that could politically be achieved in the circumstances.

NOTES 1. Related instruments Directive 2012/28/EU of the European Parliament and of the Council of 25 October 2012 on certain permitted uses of orphan works [2012] OJ L 29/5. Directive (EU) 2017/1564 of the European Parliament and of the Council of 13 September 2017 on certain permitted uses of certain works and other subject matter protected by copyright and related rights for the benefit of persons who are blind, visually impaired or otherwise print-disabled and amending Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society [2017] OJ L 242/6. Commission Staff Working Document Impact Assessment on the modernisation of EU copyright rules. Accompanying the document Proposal for a Directive of the European Parliament and of the Council on copyright in the Digital Single Market and Proposal for a Regulation of the European Parliament and of the Council laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes {COM(2016) 593} {COM(2016) 594} {SWD(2016) 302}, Brussels, 14.9.2016 SWD(2016) 301 final.

2. CJEU case law C-5/08 Infopaq International A/S v. Danske Dagblades Forening ECLI:EU:C:2009:465. C-466/12 Nils Svensson and Others v. Retriever Sverige AB ECLI:EU:C:2014:76. C-279/13 C More Entertainment AB v. Linus Sandberg ECLI:EU:C:2015:199. C-572/13 Hewlett-Packard Belgium SPRL v. Reprobel SCRL ECLI:EU:C:2015:750. C 360/13 Public Relations Consultants Association Ltd v. The Newspaper Licensing Agency Ltd ECLI:EU:C:2014:1195. C-336/14 Sebat Ince EU:C:2016:72. C-434/15 Asociación Profesional Élite Taxi v. Uber Systems Spain SL EU:C:2017:981. C-160/15 GS Media BV v. Sanoma Media Netherlands BV, Playboy Enterprises International Inv., Britt Geertruida Dekker ECLI:EU:C:2016:644.

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3. Bibliography Ackermann Th., ZUM (2019), 375. Athey S., M. Mobius and J. Pal (2017), The Impact of News Aggregators on Internet News Consumption: The Case of Localization, Stanford Business School Working Paper No. 3353: https://www.gsb.stanford.edu/facultyresearch/working-papers/impact-news-aggregators-internet-news-consumption-case-localization. Bently L., et al., Response to Article 11 of the Proposal for a Directive on Copyright in the Digital Single Market, entitled ‘Protection of press publications concerning digital uses’ on behalf of 37 professors and leading scholars of Intellectual Property, Information Law and Digital Economy (5 December 2016): https://www. cipil.law.cam.ac.uk/press/news/2016/12/cambridge-academics-respond-call-views-european-commissions-draftlegislation. Bently L., Martin Kretschmer and Technopolis Consultants (2017) The position of press publishers and authors & performers in the copyright directive, Study commissioned by European Parliament, Policy Department C: Citizens’ Rights and Constitutional Affairs (100pp): http://www.europarl.europa.eu/RegData/etudes/STUD/ 2017/596810/IPOL_STU%282017%29596810_EN.pdf. Calzada J., and R. Gil (2016), What Do News Aggregators Do? Evidence from Google News in Spain and Germany, Universitat de Barcelona and John Hopkins Carey Business School Working Paper: https://papers.ssrn.com/sol3/ papers.cfm?abstract_id=2837553. Danbury R. (2016), ‘Is an EU publishers’ right a good idea?’ Evaluating potential legal responses to threats to the production of news in a digital era, University of Cambridge Final report on AHRC project: https://www. cipil.law.cam.ac.uk/projectscopyright-and-news-research-project-2014-16/working-papers. Deloitte (2016), The impact of web traffic on revenues of traditional newspaper publishers: A study for France, Germany, Spain, and the UK (study commissioned by Google): https://www2.deloitte.com/content/dam/Deloitte/ uk/Documents/technology-media-telecommunications/deloitte-uk-impact-of-web-traffic-on-newspaper-revenues2016.pdf. Dreier Th., in Dreier and Schulze, UrhG, 6. Aufl. §87f Rn. 4, Suwelack, MMR 2018, 583. European Copyright Society (2017), General Opinion on the EU Copyright Reform Package, 24 January 2017. European Press Publishers Associations (EMMA, ENPA, EPC and NME): Putting the record straight on copyright, links and other questions (17 November 2016), Letter send to every MEP (presenting the new right as ‘straightforward’ and ‘in line with the copyright acquis’): https://goo.gl/xL0Ymk. Geiger, C., G. Frosio and O. Bulayenko (2017), CEIPI Opinion on the European Commission’s Proposal to Reform Copyright Limitations and Exceptions in the European Union, CEIPI Research Paper No. 2017-9. Hilty R. and V. Moscon, Modernisation of the EU Copyright Rules Position Statement of the Max Planck Institute for Innovation and Competition. Modernisation of the EU Copyright Rules Position Statement of the Max Planck Institute for Innovation and Competition, Max Planck Institute for Innovation & Competition Research Paper No. 17-12, SSRN Papers https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3036787. Kretschmer M., Séverine Dusollier, P. Bernt Hugenholtz and Christophe Geiger (2016), The European Commission’s public consultation on the role of publishers in the copyright value chain: A response by the European Copyright Society, European Intellectual Property Review 36(10) 591-595: https://papers.ssrn.com/sol3/papers. cfm?abstract_id=2801595. Margoni Th. (2018) Why the incoming EU copyright law will undermine the free internet: https://the conversation.com/why-the-incoming-eu-copyright-law-will-undermine-the-free-internet-99247. Max Planck Institute for Innovation and Competition (2012), Stellungnahme zum Gesetzesentwurf für eine Ergänzung des Urheberrechtsgesetzes durch ein Leistungsschutzrecht für Verleger: https://www.ip.mpg.de/ fileadmin/ipmpg/content/stellungnahmen/leistungsschutzrecht_fuer_verleger_01.pdf. Max Planck Institute for Innovation and Competition (2017), Position Statement on the Proposed Modernization of European Copyright Rules: Art. 11: https://www.ip.mpg.de/fileadmin/ipmpg/content/stellungnahmen/MPI_Position_Statement_PART_E_Publishers_2017_02_21_RMH_VM-def-1.pdf. Nera Consulting (2015), Impacto del Nuevo Artículo 32.2 de la Ley de Propiedad Intelectual, Informe para la Asociación Española de Editoriales de Publicaciones Periódicas (AEEPP) (study commissioned by Spanish Association of Publishers of Periodicals AEEPP): http://www.nera.com/publications/archive/2015/impact-of-thenew-article-322-of-the-spanish-intellectual-proper.html.

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ARTICLE 16: CLAIMS TO FAIR COMPENSATION Nordemann J. B. and S. Jehle (Nordemann), ‘VG Media/Google: German press publishers’ right declared unenforceable by the CJEU for formal reasons – but it will soon be re-born’, Kluwer Copyright Blog, November 11, 2019 . Paramythiotis Y., ‘The New Press Publishers Online Rights. A First Presentation, Interpretation and Assessment of Article 15 Directive 2019/790’ (2019) 2 Mass Media and Communications Law (DIMEE) 148, at 151 (in Greek). Peukert A. (2016), An EU Related Right for Press Publishers Concerning Digital Uses, A Legal Analysis, Research Paper of the Faculty of Law, Goethe University Frankfurt am Main No. 22/2016: https://papers.ssrn.com/sol3/ papers.cfm?abstract_id=2888040. Ricolfi, M. Raquel Xalabarder and Mireille van Eechoud (2018), Academics against Press Publishers’ Right, Statement from 169 EU academics: https://www.ivir.nl/academics-against-press-publishers-right/. Rosati E., DSM Directive Series #2: Is the press publishers’ right waivable? 1.04.2019 http://ipkitten.blogspot.com/ 2019/04/dsm-directive-series-2-is-press.html. Spitz B., ‘Press Publishers’ Right: the French Competition Authority orders Google to negotiate with the publishers, 14 April 2020 http://copyrightblog.kluweriplaw.com/2020/04/14/press-publishers-right-the-french-competitionauthority-orders-google-to-negotiate-with-the-publishers/?doing_wp_cron=1592384978.31351804733276367187 50. Stamatoudi I., ‘“Linking” and “Browsing” in the Light of the EU Court of Justice’s Recent Case Law’ in T. Pistorius (ed.), IP Perspectives on the Regulation of New Technologies, ATRIP IP series (Edward Elgar Publishing, Cheltenham (UK), Northampton (US), 2018), 179. Stamatoudi I., ‘“Linking”, “Framing” and “Browsing”. The EU Court of Justice’s Recent Case Law’, in G. Karnell, A. Kur, P. J. Nordell, D. Westman, J. Axhamn, S. Carlsson (eds), Liber Amicorum Jan Rosen (Eddy.se ab, Halmstad, 2016), 759. Stamatoudi I., ‘“Linking”, “Framing” και “Browsing”. Προ´ σφατη Νοµολογι´α του Δικαστηρι´ου της Ευρωπαϊκη´ ς |AaΕνωσης’ (2015) 3 Δι´καιο Με´ σων Ενηµε´ ρωσης και Επικοινωνι´ας (ΔΙΜΕΕ) 349. Stamatoudi I., ‘“More” Originality for Cypriot Copyright Law according to the CJEU’s Case Law’ (Spring 2018) 30(1) The Cyprus Review 207. Stamatoudi I., ‘Originality under EU Copyright Law’ in P. Torremans (ed.), Copyright Law: A Handbook of Contemporary Research (Edward Elgar Publishing, Cheltenham (UK), Northampton (US), 2017), 57. Stieper M., ZUM (2019), 213. Van Eechoud M. (2017), A publisher’s intellectual property right: Implications for freedom of expression, authors and open content policies, Research paper for OpenForum Europe: http://www.openforumeurope.org/wp-content/ uploads/2017/01/OFE-Academic-Paper-Implications-of-publishers-right_FINAL.pdf. Xalabarder R. et al. (2017), ‘CREATe Public Lectures on the Proposed EU Right for Press Publishers’, European Intellectual Property Review 39(10): 607–22. Available at SSRN: https://papers.ssrn.com/sol3/papers.cfm? abstract_id=3050575.

ARTICLE 16: CLAIMS TO FAIR COMPENSATION Member States may provide that where an author has transferred or licensed a right to a publisher, such a transfer or licence constitutes a sufficient legal basis for the publisher to be entitled to a share of the compensation for the use of the work made under an exception or limitation to the transferred or licensed right. The first paragraph shall be without prejudice to existing and future arrangements in Member States concerning public lending rights.

I. COMMENTARY This provision arises from the question how to combine two frequently present elements. On the 17.248 one hand it is a given that, depending on the activity, many exceptions across Europe are subject to compensation. These compensations are often paid for by levies on copying media or directly by

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State or national governments. On the other hand, publishers, including those of press publications, books or scientific publications and music publications, often operate on the basis of the transfer of authors’ rights by means of contractual agreements or statutory provisions. Publishers want to exploit the works so acquired in their publications and in the light of that they make an investment. But in the end the users often use the works under exceptions or limitations such as those for private copying and reprography, including the corresponding existing national schemes for reprography in the Member States, or under public lending schemes. The publisher can then be deprived of revenues, whereas the compensation may go to the author. Quite a few Member States solve this problem through provisions of national law that stipulate that compensation for uses under those exceptions or limitations is shared between authors and publishers. In order to take account of this situation and to improve legal certainty for all parties concerned, Article 16 of the Directive allows Member States that have existing schemes for the sharing of compensation between authors and publishers to maintain them.286 It is emphasised that this is a permissive provision. Member States that do not have such a sharing provision are not obliged to introduce one. In a sense the provision is also a reaction to the decision of the Bundesgerichtshof, which dealt a blow to sharing arrangements in Germany.287 17.249 The provision explicitly also does not affect existing or future arrangements in Member States regarding remuneration in the context of public lending. It also leaves national arrangements relating to the management of rights and to remuneration rights unaffected and, whilst it may also apply in a collective right management context, Member States remain free to determine how publishers are to substantiate their claims for compensation or remuneration, and to lay down the conditions for the sharing of such compensation or remuneration between authors and publishers in accordance with their national systems.288

NOTES 1. CJEU case law / national case law Bundesgerichtshof (BGH) (Federal Court of Justice), VG Wort, Az.: I ZR 198/13, decision, 4/21/16.

2. Bibliography Loewenheim, U., ‘Das BGH-Urteil zur Verlegerbeteiligung an den Einnahmen der VG Wort’, 69 (2016) 33 Neue Juristische Wochenschrift (NJW) pp. 2383–6. Lutz, P. and M. Greger, ‘Das Urteil “Verlegeranteil” des Bundesgerichtshofs und Umwälzung in der Verlagswelt’, in U. Rautenberg (ed), Jahresbericht des Instituts für Buchwissenschaft an der Friedrich-Alexander-UniversitätErlangenNürnbergForschung und Lehre 2016, at 11, https://d-nb.info/1130869601/34#page=11.

286 287

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Recital 60 to Directive 2019/790. Bundesgerichtshof (BGH) (Federal Court of Justice), VG Wort, Az.: I ZR 198/13, decision, 4/21/16. See U. Loewenheim, ‘Das BGH-Urteil zur Verlegerbeteiligung an den Einnahmen der VG Wort’, 69 (2016) 33 Neue Juristische Wochenschrift (NJW) pp. 2383–6 and P. Lutz and M. Greger, ‘Das Urteil “Verlegeranteil” des Bundesgerichtshofs und Umwälzung in der Verlagswelt’, in U. Rautenberg (ed), Jahresbericht des Instituts für Buchwissenschaft an der Friedrich-Alexander-UniversitätErlangen-NürnbergForschung und Lehre 2016, at 11, https://d-nb.info/1130869601/ 34#page=11. Recital 60 to Directive 2019/790.

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CHAPTER 2 CERTAIN USES OF PROTECTED CONTENT BY ONLINE SERVICES ARTICLE 17: USE OF PROTECTED CONTENT BY ONLINE CONTENT-SHARING SERVICE PROVIDERS 1.

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Member States shall provide that an online content-sharing service provider performs an act of communication to the public or an act of making available to the public for the purposes of this Directive when it gives the public access to copyright-protected works or other protected subject matter uploaded by its users. An online content-sharing service provider shall therefore obtain an authorisation from the rightholders referred to in Article 3(1) and (2) of Directive 2001/29/EC, for instance by concluding a licensing agreement, in order to communicate to the public or make available to the public works or other subject matter. Member States shall provide that, where an online content-sharing service provider obtains an authorisation, for instance by concluding a licensing agreement, that authorisation shall also cover acts carried out by users of the services falling within the scope of Article 3 of Directive 2001/29/EC when they are not acting on a commercial basis or where their activity does not generate significant revenues. When an online content-sharing service provider performs an act of communication to the public or an act of making available to the public under the conditions laid down in this Directive, the limitation of liability established in Article 14(1) of Directive 2000/31/EC shall not apply to the situations covered by this Article. The first subparagraph of this paragraph shall not affect the possible application of Article 14(1) of Directive 2000/31/EC to those service providers for purposes falling outside the scope of this Directive. If no authorisation is granted, online content-sharing service providers shall be liable for unauthorised acts of communication to the public, including making available to the public, of copyright-protected works and other subject matter, unless the service providers demonstrate that they have: (a) made best efforts to obtain an authorisation, and (b) made, in accordance with high industry standards of professional diligence, best efforts to ensure the unavailability of specific works and other subject matter for which the rightholders have provided the service providers with the relevant and necessary information; and in any event (c) I acted expeditiously, upon receiving a sufficiently substantiated notice from the rightholders, to disable access to, or to remove from their websites, the notified works or other subject matter, and made best efforts to prevent their future uploads in accordance with point (b). In determining whether the service provider has complied with its obligations under paragraph 4, and in light of the principle of proportionality, the following elements, among others, shall be taken into account: (a) the type, the audience and the size of the service and the type of works or other subject matter uploaded by the users of the service; and (b) the availability of suitable and effective means and their cost for service providers. Member States shall provide that, in respect of new online content-sharing service providers the services of which have been available to the public in the Union for less than three years and which have an annual turnover below EUR 10 million, calculated in accordance with Commission Recommendation 2003/361/EC, the conditions under the liability regime set out in paragraph 4 are limited to compliance with point (a) of paragraph 4 and

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to acting expeditiously, upon receiving a sufficiently substantiated notice, to disable access to the notified works or other subject matter or to remove those works or other subject matter from their websites. Where the average number of monthly unique visitors of such service providers exceeds 5 million, calculated on the basis of the previous calendar year, they shall also demonstrate that they have made best efforts to prevent further uploads of the notified works and other subject matter for which the rightholders have provided relevant and necessary information. The cooperation between online content-sharing service providers and rightholders shall not result in the prevention of the availability of works or other subject matter uploaded by users, which do not infringe copyright and related rights, including where such works or other subject matter are covered by an exception or limitation. Member States shall ensure that users in each Member State are able to rely on any of the following existing exceptions or limitations when uploading and making available content generated by users on online content-sharing services: (a) quotation, criticism, review; (b) use for the purpose of caricature, parody or pastiche. The application of this Article shall not lead to any general monitoring obligation. Member States shall provide that online content-sharing service providers provide rightholders, at their request, with adequate information on the functioning of their practices with regard to the cooperation referred to in paragraph 4 and, where licensing agreements are concluded between service providers and rightholders, information on the use of content covered by the agreements. Member States shall provide that online content-sharing service providers put in place an effective and expeditious complaint and redress mechanism that is available to users of their services in the event of disputes over the disabling of access to, or the removal of, works or other subject matter uploaded by them. Where rightholders request to have access to their specific works or other subject matter disabled or to have those works or other subject matter removed, they shall duly justify the reasons for their requests. Complaints submitted under the mechanism provided for in the first subparagraph shall be processed without undue delay, and decisions to disable access to or remove uploaded content shall be subject to human review. Member States shall also ensure that out-of-court redress mechanisms are available for the settlement of disputes. Such mechanisms shall enable disputes to be settled impartially and shall not deprive the user of the legal protection afforded by national law, without prejudice to the rights of users to have recourse to efficient judicial remedies. In particular, Member States shall ensure that users have access to a court or another relevant judicial authority to assert the use of an exception or limitation to copyright and related rights. This Directive shall in no way affect legitimate uses, such as uses under exceptions or limitations provided for in Union law, and shall not lead to any identification of individual users nor to the processing of personal data, except in accordance with Directive 2002/ 58/EC and Regulation (EU) 2016/679. Online content-sharing service providers shall inform their users in their terms and conditions that they can use works and other subject matter under exceptions or limitations to copyright and related rights provided for in Union law. As of 6 June 2019 the Commission, in cooperation with the Member States, shall organise stakeholder dialogues to discuss best practices for cooperation between online contentsharing service providers and rightholders. The Commission shall, in consultation with online content-sharing service providers, rightholders, users’ organisations and other relevant stakeholders, and taking into account the results of the stakeholder dialogues, issue guidance on the application of this Article, in particular regarding the cooperation referred to in paragraph 4. When discussing best practices, special account shall be taken,

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among other things, of the need to balance fundamental rights and of the use of exceptions and limitations. For the purpose of the stakeholder dialogues, users’ organisations shall have access to adequate information from online content-sharing service providers on the functioning of their practices with regard to paragraph 4.

I. COMMENTARY 1. Communication to the public In our modern connected societies based on Internet 2.0 it is quite common for users to upload 17.250 materials to platforms of online content-sharing service providers, such as YouTube. Whilst there is, on the one hand, very little debate about the fact that these uploads consist very often of protected subject matter in general and of copyright protected works in particular, there was, on the other hand, much more debate when it came to infringing acts and liability that came along in the process. The uploading user is likely to make a copy of the work and may thereby infringe the right of reproduction, but most of the damage occurs in all likelihood through the communication of the work to the public. But does that mean the uploading by the user of the platform and do we assume that the operator of the platform stays neutral and therefore does not incur any liability? Or does the operator communicate the works that have been uploaded by the user to the public and incurs liability on that basis? There was a lot of debate on these points. Paragraph 1 of Article 17 provides a clear and uniform answer on this point.289 It places the use of copyright works and other protected subject matter (once uploaded by the users) by providers on online content-sharing platforms squarely in the orbit of the right of communication to the public as defined in EU copyright law. By providing the platform and by giving the public access to the user-uploaded works the platform provider performs the (restricted) act of communication to the public. Giving access needs to be understood as enabling users to upload and share content.290 The Directive operates therefore a somewhat truncated version of communication to the public that does not ask the question whether the provider undertook its intervention in full knowledge of its consequences.291 There is a kind of

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The genesis of Art. 17 (previously known as Art. 13 in the draft Directive) gave rise to stormy debates and a lot of controversy. See Martin R.F. Senftleben, Christina Angelopoulos, Giancarlo F. Frosio, Valentina Moscon, Miguel Peguera and Ole-Andreas Rognstad, ‘The Recommendation on Measures to Safeguard Fundamental Rights and the Open Internet in the Framework of the EU Copyright Reform’ (2018) 40 European Intellectual Property Review 149; Christina Angelopoulos, ‘On Online Platforms and the Commission’s New Proposal for a Directive on Copyright in the Digital Single Market’, available at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2947800; Giancarlo F. Frosio, ‘From Horizontal to Vertical: An Intermediary Liability Earthquake in Europe’ (2017) 12 Oxford Journal of Intellectual Property and Practice 565–75; Giancarlo F. Frosio, ‘Reforming Intermediary Liability in the Platform Economy: A European Digital Single Market Strategy’ (2017) 112 Northwestern University Law Review 19; R. M. Hilty and V. Moscon (eds), Modernisation of the EU Copyright Rules – Position Statement of the Max Planck Institute for Innovation and Competition, Max Planck Institute for Innovation and Competition Research Paper No. 17-12, Max Planck Institute for Innovation and Competition: Munich 2017; R. M. Hilty and V. Moscon, ‘Contributions by the Max Planck Institute for Innovation and Competition in Response to the Questions Raised by the Authorities of Belgium, the Czech Republic, Finland, Hungary, Ireland and the Netherlands to the Council Legal Service Regarding Article 13 and Recital 38 of the Proposal for a Directive on Copyright in the Digital Single Market’, available at: http://www.ip.mpg.de/; CREATe et al., ‘Open letter to Members of the European Parliament and the Council of the European Union’, available at: http://www.create.ac.uk/policy-responses/eu-copyright-reform/; E. Rosati, ‘Why a Reform of Hosting Providers’ Safe Harbour is Unnecessary Under EU Copyright Law’, CREATe Working Paper 2016/11 (August 2016), available at: https://ssrn.com/abstract=2830440; S. Stalla-Bourdillon, E. Rosati, M. C. Kettemann et al., ‘Open Letter to the European Commission – On the Importance of Preserving the Consistency and Integrity of the EU Acquis Relating to Content Monitoring within the Information Society’, available at: https:// ssrn.com/abstract=2850483. Directive 2019/790, Recital 62. And thereby pre-empts the CJEU’s decision in case C-682/18 – YouTube (pending at the time of writing, http://curia.europa.eu/juris/fiche.jsf?id=C%3B682%3B18%3BRP%3B1%3BP%3B1%3BC2018%2F0682%2FP&oqp= &for=&mat=or&lgrec=en&jge=&td=%3BALL&jur=C%2CT%2CF&num=C-682%252F18&dates=&pcs=Oor&lg=&

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non-rebuttable presumption that the service provider knows that making available the platform will lead to infringing uploads by its users.292

2. Authorisation 17.251 This is the starting point. That starting point provides a clear link with Articles 3(1) and 3(2) of Directive 2001/29/EC293 and Article 17(1) derives from there that a provider of an online content-sharing service must obtain authorisation to communicate or make available to the public works or other subject matter from the rightholders that are referred to in Articles 3(1) and 3(2). 17.252 The point that it is expressly stated that the authorisation needs to be obtained from the ‘rightholders’ rules out the option for a national legislator to create a legal licence that would give the providers the authorisation they need.294 The right held by the rightholder in application of Article 3(1) of Directive 2001/29295 is preventive in nature. That point was emphasised by the CJEU in the Soulier case296 and that means that any communication to the public297 of a work by a third party requires the prior consent of the rightholder. Unless it is covered by an exception or limitation under Article 5 of Directive 2001/29 any use of the work by a third party without consent will amount to an infringement of the work.298 17.253 Thus, the authorisation that is required in Article 17(1) can only be provided by the rightholders themselves. A forced authorisation as a result of a non-voluntary licence that would be imposed by the national legislator is therefore not an option.299 This follows also logically from the way the concept of an exclusive right is anchored in the international copyright conventions. These distinguish very clearly between on the one hand an exclusive right and on the other hand a mere right to obtain an equitable remuneration, which would be the consequence of the imposition of a non-voluntary licence and a forced authorisation.

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pro=&nat=or&cit=none%252CC%252CCJ%252CR%252C2008E%252C%252C%252C%252C%252C%252C%252C %252C%252C%252Ctrue%252Cfalse%252Cfalse&language=en&avg=&cid=40788 ). K. Grisse, ‘After the Storm – Examining the Final Version of Article 17 of the new Directive (EU) 2019/790’ (2019) 14 Journal of Intellectual Property Law & Practice 887, at 890. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/10. In Case C-516/17 Spiegel Online GmbH v Volker Beck the Court of Justice carefully distinguishes (in a different but sufficiently similar context) between the case of an authorisation by the rightholder himself and other cases: Thus, it must be held that a work, or a part of a work, has already been lawfully made available to the public if it has been made available to the public with the authorisation of the copyright holder or in accordance with a non-contractual licence or a statutory authorisation.

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ECLI:EU:C:2019:625, at para. 89. And the one held in application of Art. 2(a) for that purpose. Case C-301/15 Marc Soulier and Sara Doke v Premier ministre and Ministre de la Culture et de la Communication ECLI:EU:C:2016:878, at paras 33 and 34. Or reproduction. See, in this sense also, Case C-135/10 Società Consortile Fonografici (SCF) v Marco Del Corso, ECLI:EU:C:2012:140, at para. 75; Case C-117/15 Reha Training Gesellschaft für Sport- und Unfallrehabilitation mbH v Gesellschaft für musikalische Aufführungs- und mechanische Vervielfältigungsrechte eV (GEMA) ECLI:EU:C:2016:379, at para. 30; Case C-160/15 GS Media BV v Sanoma Media Netherlands BV and Others ECLI:EU:C:2016:644, at para. 28; Case C-527/15 Stichting Brein v Jack Frederik Wullems ECLI:EU:C:2017:300, at para. 25; Case C-610/15 Stichting Brein v Ziggo BV and XS4All Internet BV ECLI:EU:C:2017:456, at para. 20; Case C-161/17 Land Nordrhein-Westfalen v Dirk Renckhoff ECLI:EU:C:2018:634, at paras 16 and 29; compare for the rights of performers Case C-484/18 Société de perception et de distribution des droits des artistes-interprètes de la musique et de la danse (Spedidam) and Others v Institut national de l’audiovisuel ECLI:EU:C:2019:970, at para. 38. Directive 2019/790, Recital 61, final sentence.

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It flows from the fact that Article 17 is based on the primary principle of authorisation that a 17.254 provider of online content-sharing services will be liable for unauthorised acts of communication to the public, including the making available to the public of works and other protected subject matter. Paragraph 1 suggests that this direct liability for the users’ upload can be avoided and it gives the example of an authorisation being obtained by the provider through a licence. Such a licence can be obtained directly from the copyright holder, but collective licensing mechanisms are, of course, also an option. By taking part voluntarily in a system of collective management of rights, the copyright holder (indirectly) provides an authorisation. Extended collective management300 is also possible, as on the one hand the authorisation of the copyright holder is presumed, but on the other hand the copyright holder has the right of withdrawal. By not exercising that right the copyright holder leaves that authorisation created by the extended collective licensing provisions in place and the requirement remains met. Licensing is clearly the method chosen to achieve the authorisation goal under this provision and it is the Directive’s objective to ‘foster the development of the licensing market between rightholders and providers’.301 Paragraph 2 then shifts the focus from the provider to the users of the services of the provider. In 17.255 cases where the provider has obtained an authorisation for the copyright holder Member States need to provide by law that that authorisation will also cover the acts carried out by the users of the service. These users will no longer be liable for the infringement of Article 3 of Directive 2001/29302 in case their acts amount to communicating a work to the public or to making other subject matter available to the public. It is important to note that whilst the authorisation from the copyright holder is required to trigger the mechanism, that authorisation does not need to take the form of a licence. Yet again, the licensing agreement is merely given as an example. The legislator also clearly had private users of the providers’ services in mind. That idea is transposed into legislative instructions by excluding users acting on a commercial basis or where their activity generates significant revenues. Professional users will need their own authorisation and it is fair to assume that any business will be acting on a commercial basis and will therefore be excluded from the benefit of the mechanism. Private users may, as it were, impersonate a commercial user and de facto make a partial living out of their use of the services of the provider. They should then also not be able to benefit from the mechanism and that result is achieved by withdrawing the benefit of the mechanism where the activity generates significant revenues. One can assume that one looks at the overall use of the services by the user, rather than at use in relation to a single upload or a single copyright work. Be that as it may, it is left to the national legislator to translate the rather vague concept of significant revenues into a more precise threshold the courts can work with. The copyright holder may also grant the user an authorisation to upload the work. In that case the 17.256 service provider will also be covered by that authorisation according to Recital 69. More precisely there will in such a case be no communication to the public by the service provider, as there will be no new public. Any public was after all already envisaged by the authorisation to upload.303

3. No safe haven One can in this context also not avoid Article 14(1) of the e-commerce Directive,304 as it puts in 17.257 place a limitation of liability for providers. That limitation of liability is ruled out entirely for the

300 301 302 303 304

See also ibid., Art. 12. Ibid., Recital 61. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/10. Grisse, note 292, at 890. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market [2000] OJ L 178/1.

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scenario on which this new Directive is based, i.e., when an online content-sharing service provider performs an act of communication to the public or an act of making available to the public. That brings us also to the point that one needs to be clear about the point of which service providers are covered by the new Directive.305 The starting point here is the idea of an information society service that is designed to give the public access to copyright protected content or other subject matter that is uploaded by its users. Copyright protected content is offered to the public, but the access is provided through user upload rather than by direct provision by the service and its operator. Direct provision is straightforwardly subject to an authorisation and a copyright licence. The uncertainty whether a user upload-based service needs such an authorisation and the distortion of the copyright market that flows from it are the problems which Article 17 wants to address. This is also where the much-discussed value gap comes in and where under the uncertain circumstances providers and platforms make a lot of money on the back of copyright works, whereas the copyright holder receives very little by way of remuneration for the use of the work.306 Article 17 should therefore target only online services that play an important role on the online content market by competing for the same audiences with other online content services, such as online audio and video streaming services and make everyone in the market pay remuneration to the copyright holder when works are used. That brings the legislator according to Article 2(6) and Recital 62 to the conclusion that: services covered by this Directive are services, the main or one of the main purposes of which is to store and enable users to upload and share a large amount of copyright-protected content with the purpose of obtaining profit therefrom, either directly or indirectly, by organising it and promoting it in order to attract a larger audience, including by categorising it and using targeted promotion within it.

The Directive does not propose an exact qualitative standard to assess whether what is uploaded and shared amounts to a large amount of copyright-protected content. Instead this is to be determined on a case-by-case basis and factors such as the audience of the service and the number of files of copyright-protected content uploaded by the users of the service should be taken into account, amongst the overall combination of elements.307 All in all it is clear that YouTube and the likes are covered by the definition, but vague terms such as ‘main purpose’ and ‘large amount of copyrightprotected works’ leave a degree of uncertainty behind, even if a judge may appreciate this amount of flexibility. We also refer back in this respect to the discussion of Article 2(6) above. Suffice it to add here that online sharing services that do not organise or promote the uploading of material by the user and for which uploading by users is therefore not one of their main purposes will fall outside the definition and will not become liable on the basis of Article 17(1).308 Occasionally, copyright material will be uploaded through these services, but here the flexible large amount standard comes in handy to permit services that do not focus on pirated content (and that have no elaborate search function to find the exact content wanted by the user) and that have not built their whole business model around income generated from these user uploads of copyright material. These services will instead remain under the existing secondary liability system and the safe harbour provisions of Article 14 e-commerce Directive and the Court of Justice of the European Union has the opportunity to design a tailormade regime for those services in the Elsevier v. Cyando case.309

305 306

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Directive 2019/790, Art. 2(6) and Recital 62. J. Quintais, ‘The New Copyright in the Digital Single Market Directive: A Critical Look’ (2020) 42(1) European Intellectual Property Review 28–41 and A. Lucas-Schloetter, ‘Transfer of Value Provisions of the Draft Copyright Directive’ https://authorsocieties.eu/content/uploads/2019/10/lucas-schloetter-analysis-copyright-directive-en.pdf. For a sceptical view see J. Wimmers and M. Barudi, ‘Der Mythos vom Value Gap’ (2017) 119 GRUR 327. Recital 63 to Directive 2019/790. Grisse, note 292, at 888. A. Metzger and M. Senftleben (on behalf of the European Copyright Society), ‘Comment of the European Copyright Society on Selected Aspects of Implementing Article 17 of the Directive on Copyright in the Digital Single Market into National Law’ https://europeancopyrightsocietydotorg.files.wordpress.com/2020/04/ecs-comment-article-17-cdsm. pdf, p. 3. Case C-683/18 Elsevier v Cyando pending at the time of writing.

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On the other hand, electronic communication services within the meaning of Directive (EU) 17.258 2018/1972,310 providers of business-to-business cloud services and cloud services which allow users to upload content for their own use such as cyberlockers, providers of services such as open source software development and sharing platforms, not-for-profit scientific or educational repositories, not-for-profit online encyclopedias or online marketplaces the main activity of which is online retail, rather than giving access to copyright-protected content, should be excluded from the definition of online content-sharing service providers. The basis for this exclusion and the limitation of the definition that flows from it are based on the fact that these services have a main purpose other than that of enabling users to upload and share a large amount of copyright-protected content with the purpose of obtaining profit from that activity.311 And the logic of the scheme dictates that for purposes that fall outside the scope of the new Directive service providers can potentially rely on Article 14(1) of the e-commerce Directive, as can of course service providers that only provide services that fall outside the scope of the new Directive.312

4. The best efforts option Having excluded the limitation of liability in the e-commerce Directive, the new Directive partially 17.259 mitigates this and the liability of the service providers in paragraph 4 of its Article 17. Recital 66 calls this a ‘specific liability mechanism’. Such a mechanism was needed as realistically service providers are unlikely to be able to obtain authorisation for whatever content users may wish to upload on their platform. And since the aim was by no means to stop users from uploading or restrict their freedom of expression in any way, an alternative to avoid liability became a necessity. What does not change is the nature of the liability. We are still dealing with primary infringement, but an exception is created in the form of an exemption from liability when certain conditions are met.313 In the absence of an authorisation service providers may more precisely still escape liability if they meet three conditions. Crucially, service providers should demonstrate first of all that they have made best efforts to obtain an authorisation.314 This requirement will also make sure that the liability exemption mechanism shall not apply to service providers the main purpose of which is to engage in or to facilitate copyright piracy. They will never put in best efforts to obtain authorisation.315 One needs to put this best-efforts requirement in the context of the reality that service providers do not know in advance which works their users will upload. It would therefore be unreasonable to require service providers to trace each and every copyright holder, including those of rather unknown works and to do so globally. A certain degree of proportionality must kick in at this stage. Best efforts may therefore mean contacting all major labels and collective management organisations, whilst being prepared to acquire an authorisation for their whole repertoire including all existing and future works.316 Article 12 of the new Directive may assist on this point as it brings in an aspect of extended collective licensing that could allow CMOs to cover works of copyright holders that are not their members (not even via reciprocal arrangements amongst CMOs).317 Areas remain though where there are no CMOs.318 Due diligence could then mean contacting major copyright holders, who hold many rights, and being ready to start negotiations with any copyright

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Directive (EU) 2018/1972 of the European Parliament and of the Council of 11 December 2018 establishing the European Electronic Communications Code [2018] OJ L 321/36. Directive 2019/790, Recital 62. Ibid., Art. 17(3). K.-N. Peifer, ‘Sharing-Plattformbetreiberhaftung im Urheberrecht (Art. 17 DSM-RL)’ (2019) 11 GRUR-Prax 403 and A. Wandtke, ‘Grundsätze der Richtlinie über das Urheberrecht im digitalen Binnenmarkt’ (2019) 72 NJW 1841, at 1846. Directive 2019/790, Art. 17(4)a). Ibid., Recital 62. Metzger and Senftleben (on behalf of the European Copyright Society), note 308, p. 5. Grisse, note 292, at 893. Quintais, note 306.

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holder who contacts the service provider. The service provider must also be ready to accept reasonable and fair conditions if it is to demonstrate that it put in best efforts, even if it is ultimately a matter for the courts to decide what are reasonable and fair conditions.319 Recital 61 makes that clear by requiring fairness and a reasonable balance between the interests of the parties. But rightholders are of course never under an obligation to enter into an agreement and to grant authorisation.320 17.260 Secondly, best efforts are also required to ensure the unavailability of works and other subject matter for which the copyright holders have provided the service provider with the relevant and necessary information. These best efforts are to be put in in accordance with high industry standards of professional diligence.321 It is important to note here straight away that the failure to obtain authorisation does not mean the service provider is under an obligation to make the works concerned that are nevertheless uploaded by its users unavailable. They can remain available on the platform and no liability will arise from their mere presence. For that to change the Directive turns again to its cherished idea of cooperation between copyright holders and service providers. It is up to the copyright holder to notify the service provider that its works are available on the platform and that he or she objects to that. That is the trigger for the service providers being required to put in best efforts to make the works unavailable. The copyright holder needs to provide the service provider with the relevant and necessary information, which in practice means information that allows the identification of the work. As that information must also enable the work to be made unavailable this will involve a copy of the work and the metadata that go with it. Upon receiving such notification, the service provider needs to deploy best efforts, in accordance with high industry standards of professional diligence. This has given rise to a much-hyped debate about filtering and massive restrictions on freedom of expression.322 We will return to these elements later, but it is respectfully submitted that they are the wrong starting point. Instead, all this turns around industry standards, professional diligence and best efforts to comply with these standards of professional diligence. Whether one likes it or not, the industry standard involves highly sophisticated and automated recognition software being deployed on a systematic basis by service providers. That software is able to recognise works, especially if the copyright holder has provided the relevant information. Increasingly the software is sophisticated enough to recognise parodies and adaptations too.323 Currently the service providers mainly deploy it to associate publicity messages with certain works or aspects of works, but they also use it to block access and e.g., make pornography and hate speech unavailable.324 Admittedly, the focus is currently mainly on visual images325 and less on text, but the technology is being rolled out across the spectrum. Deploying this recognition system and then making the identified (copies of the) works unavailable will be the way to meet the

319 320 321 322

323

324 325

Grisse, note 292, at 893. Directive 2019/790, Recital 62. Ibid., Art. 17(4)(b). M. Husovec, ‘How Europe Wants to Redefine Global Online Copyright Enforcement’, in T.- E. Synodinou (ed.), Pluralism or Universalism in International Copyright Law, Kluwer law International (2019) and Sophie Stalla-Bourdillon, Eleonora Rosati, Karmen Turk et al., ‘A Brief Exegesis of the Proposed Copyright Directive’ (24 November 2016), https://ssrn.com/abstract=287529. P. Blassel, ‘Eléments relatifs à la transposition de l’article 17 de la Directive sur le droit d'auteur dans le marché unique numérique’, paper delivered at the conference of the Association française pour la protection internationale du droit d’auteur : Actualité internationale, européenne et française du droit d’auteur, 14the February 2020, Paris – Hôtel de Massa. Case C-18/18 Eva Glawischnig-Piesczek v. Facebook Ireland Limited ECLI:EU:C:2019:821. See the French proposal for an extended collective licence for images returned by search engines: P. Sirinelli, ‘Soumission au droit d’auteur des services de référencement d’images des moteurs de recherche’, paper delivered at the conference of the Association française pour la protection internationale du droit d’auteur : Actualité internationale, européenne et française du droit d’auteur; and P. Sirinelli and S. Dormont, ‘Services automatisés de référencement d’images – Rapport et proposition de modification législative’, Ministère de la Culture et de la Communication, Conseil Supérieur de la Propriété Littéraire et Artistique (2019).

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best efforts requirement in accordance with industry standards. There is of course also an element of proportionality in here326 and absolute effectiveness is not required. The specific way to comply with the obligation is also left to the service provider.327 The Republic of Poland considers that Article 17(4)(b) infringes the right to freedom of expression and has brought a case before the Court of Justice of the European Union to seek its annulment.328 Thirdly, the service provider must act expeditiously upon receiving the notification to disable access 17.261 to the works at issue or to remove them from its website. This is coupled with a best-efforts obligation to prevent their future upload. All these efforts are targeted at the works that are notified to the service provider and there is no general monitoring obligation.329 The notification system demonstrates that as a matter of principle the exclusive right of the copyright holder takes priority and remains the basic rule. That is also necessary in the light of the interests of the rightholder. Any delay in taking down the offending copy of the work and in making it unavailable, e.g., by seeking the input of the uploader, let alone having a full determination with an appeal option, and a requirement that the copyright holder proves the merit of his or her action would (potentially) lead to irreparable damage. In the digital internet age illegal content can after all be multiplied and spread rapidly, making its eradication virtually impossible, and at the same time the market for legitimate copies of the work can be destroyed. That is not to say that in a second stage there does not have to be a counterbalance with limitations and exceptions and with fundamental rights such as the rights to freedom of expression and information.330 We will return to that stage later. Finally, it is important to note that the Republic of Poland considers that Article 17(4)(c) infringes the right to freedom of expression and has brought a case before the Court of Justice of the European Union to seek its annulment.331 Paragraph 5 of Article 17 of the Directive then lists in a non-exhaustive manner some factors that 17.262 need to be taken into account in determining whether the service provider has complied with its obligation under paragraph 4. These factors are ‘the type, the audience and the size of the service and the type of works or other subject matter uploaded by the users of the service’ and ‘the availability of suitable and effective means and their cost for service providers’. One sees here rather strongly the principle of proportionality at work. Small providers may have fewer means at their disposal and some types of works give rise to more practical problems than others. The combined effect of paragraphs (4) and (5) is a second option for the service provider to deal with its liability. The preferred main option is the authorisation by the copyright holder. Paragraph (4) then provides an exception to the liability. The first requirement very clearly maintains the liability and hence the need to try to secure an authorisation, but if these efforts fail the rightholder benefits from an exemption until the copyright holder notifies the service provider. As the service provider is not uploading itself it cannot stop the upload and hence the obligation to make the uploaded infringing copy unavailable, to keep it down or to remove it. On that basis the benefit of the exception to liability can be retained by the service provider.

326 327 328

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Directive 2019/790, Recital 66. Grisse, note 292, at 894. Case C-401/19 Republic of Poland v European Parliament and Council of the European Union, pending (http:// curia.europa.eu/juris/document/document.jsf?text=&docid=216823&pageIndex=0&doclang=EN&mode=lst&dir=&oc c=first&part=1&cid=8371710). Metzger and Senftleben (on behalf of the European Copyright Society), note 308, p. 8. ALAI (V. Castro Rosa, M. Ficsor, J. Ginsburg, F. Gotzen, A. Quaedvlieg, J. Rosén, J. Seignette, P. Sirinelli, P. Torremans, S. von Lewinski, M. Walter), ‘Draft Opinion on certain aspects of the implementation of Article 17 of Directive (EU) 2019/790 of 17 April 2019 on copyright and related rights in the digital single market’, 30 March 2020, https://www.alai.org/en/assets/files/resolutions/200330-opinion-article-17-directive-2019_790-en.pdf, para. 3. Case C-401/19 Republic of Poland v European Parliament and Council of the European Union, pending (http:// curia.europa.eu/juris/document/document.jsf?text=&docid=216823&pageIndex=0&doclang=EN&mode=lst&dir=&oc c=first&part=1&cid=8371710).

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5. Start-ups 17.263 Paragraph (6) recognises that the regime put in place by paragraph (4) can be onerous, especially for new entrants to the market. Its full application could deter their appearance and reduce the level of competition on the market for service providers. That would be an undesirable consequence and paragraph (6) therefore establishes a less onerous regime for new entrants. A new online content-sharing service provider is defined as a provider the services of which have been available to the public in the European Union for less than three years and that has an annual turnover below EUR 10 million.332 For these service providers the conditions under the liability regime set out in paragraph 4 are limited to compliance with point (a) of paragraph 4 and to acting expeditiously, upon receiving a sufficiently substantiated notice, to disable access to the notified works or other subject matter or to remove those works or other subject matter from their websites. Yet again the idea of obtaining authorisation being the first alternative is retained. And it is not merely the case that they can benefit from this less onerous regime for three years starting from their arrival on the EU market. When the average number of monthly unique visitors of such service providers exceeds 5 million,333 they shall also demonstrate that they have made best efforts to prevent further uploads of the notified works and other subject matter for which the rightholders have provided relevant and necessary information. All in all, this provision may be of assistance for new starters, but its limited application over a three-year period means that its impact should not be overestimated. It merely means starters can delay somewhat the investments in staff and equipment that are needed to comply with paragraph (4).334

6. Exceptions and limitations 17.264 The fact that the exclusive right enjoys priority as a matter of principle in the system put in place by Article 17 does not change the very nature of copyright. That means that an exclusive right is by no means an absolute right and is subject to exceptions and limitations.335 Paragraph (7) of Article 17 reconfirms that idea. Non-infringing works should be uploaded freely and without restriction and that also applies to works and content covered by an exception or limitation.336 No new exceptions or limitations are introduced and in general reference is made to the existing system that resulted from Article 5 of Directive 2001/29/EC.337 In particular reference is made to the exceptions for quotation, criticism and review and to the exception covering use for the purpose of caricature, parody or pastiche.338 These are mandatory and Member States need to ensure that users can rely on them.339 In other words Member States that had not implemented them will need to do so.340

332 333 334 335

336 337 338 339 340

Calculated in accordance with Commission Recommendation 2003/361/EC of 6 May 2003 concerning the definition of micro, small- and medium-sized enterprises [2003] OJ L 124/36. Calculated on the basis of the previous calendar year, so they have time to put the additional measures in place. Quintais, note 306. S. F. Schwemer and J. Schovsbo, ‘What Is Left of User Rights: Algorithmic Copyright Enforcement and Free Speech in the Light of the Article 17 Regime’, in P. Torremans (ed), Intellectual Property and Human Rights (Kluwer Law International, 4th ed, 2020), 569. J. Quintais et al, ‘Safeguarding User Freedoms in Implementing Article 17 of the Copyright in the Digital Single Market Directive: Recommendations from European Academics’, https://www.ivir.nl/recommendationsarticle17/. ALAI (V. Castro Rosa, M. Ficsor, J. Ginsburg, F. Gotzen, A. Quaedvlieg, J. Rosén, J. Seignette, P. Sirinelli, P. Torremans, S. von Lewinski, M. Walter), note 330, para. 4. Directive 2019/790, Recital 70. Quintais, note 306. Grisse, note 292, at 898. Quintais et al, note 336.

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Content recognition software is getting better in distinguishing infringing content from content that may be covered by an exception or limitation,341 but quite obviously work remains to be done in this area.342 In the context of uploads by users, reference is often made to the fundamental right of freedom of 17.265 expression. It was often argued that fundamental rights and the interests they protect and guarantee can lead to the creation of additional exceptions and limitations.343 Such an approach is susceptible to overlooking the fact that copyright, as an intellectual property right, is also given fundamental right status in Article 17(2) of the Charter of Fundamental Rights of the European Union.344 It is therefore not possible for an external factor such as the right of freedom of expression to simply overrule copyright.345 What is needed according to the Court of Justice of the European Union is a balancing exercise between the various fundamental rights that will need to be proportionate and that will need to strike a fair balance between the various fundamental rights by taking all interests involved into account.346 That balancing exercise needs to take place within the existing copyright framework.347 The court has ruled out the creation of additional limitations and exceptions on top of those listed in Article 5 of Directive 2001/29/EC.348 Instead, a flexible interpretation of the existing exceptions needs to be adopted that allows the interests of all fundamental rights, such as the right to freedom of expression and the right to run a business, to be respected. The three-step test will also apply in this context. Such a flexible interpretation of exceptions and limitations can be illustrated well in the context of the exception for pastiches. Member States can clarify that this exception may be particularly useful for user generated content.349 Pastiche can involve after all a genuine mix of styles and materials that plays sufficiently with the underlying source materials to identify it as a separate and different work. The problem that remains is that such user generated content often leaves one original work unchanged, such as the background music to the video. Limiting pastiche to the genuine mix does not solve that problem, but a wider definition in national law could include it coupled with an equitable remuneration obligation. The latter is already administered by CMOs and can therefore exempt service providers from the more cumbersome regime of Article 17.350 The emphasis on parody and review and criticism fits in well with this approach, but whilst this may work well for freedom of expression it remains to be seen how far one can stretch parody in a freedom to run a business context.351 Clearly the Court of Justice of the European Union is likely to be called upon again and again to fully clarify matters in this area.352

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Blassel, note 323. M. Senftleben, ‘Bermuda Triangle – Licensing, Filtering and Privileging User-Generated Content Under the New Directive on Copyright in the Digital Single Market’ (2019) 41(8) European Intellectual Property Review 480–90. C. Geiger, ‘Freedom of Artistic Creativity and Copyright Law: A Compatible Combination?’ (2018) 8 UC Irvine Law Review 413 and C. Geiger, ‘Copyright and the Freedom to Create – A Fragile Balance’, (2007) 38 IIC 707. Charter of Fundamental Rights of the European Union [2012] OJ C 326/391. G. Spina Alì, ‘Intellectual Property and Human Rights: A Taxonomy of Their Interactions’ (2020) 51 IIC 411–45. Case C-469/17 Funke Medien NRW GmbH v Bundesrepublik Deutschland ECLI:EU:C:2019:623 and Case C-516/17 Spiegel Online GmbH v Volker Beck ECLI:EU:C:2019:625. Quintais et al, note 336. ALAI (V. Castro Rosa, M. Ficsor, J. Ginsburg, F. Gotzen, A. Quaedvlieg, J. Rosén, J. Seignette, P. Sirinelli, P. Torremans, S. von Lewinski, M. Walter), note 330, para. 4. Case C-469/17 Funke Medien NRW GmbH v Bundesrepublik Deutschland ECLI:EU:C:2019:623 and Case C-516/17 Spiegel Online GmbH v Volker Beck ECLI:EU:C:2019:625. Parody is clearly in the same league. Metzger and Senftleben (on behalf of the European Copyright Society), note 308, p. 14. T. Synodinou, ‘Wider implications of the CJEU’s Case law on other fundamental rights: Is the freedom of expression the only “victim” of Spiegel Online?’, presentation at the 6th Annual Conference on Media & Communication Law: Digital Platforms & Social Media: Legislative Developments & Current Challenges, Athens 7 February 2020. Quintais, note 306.

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7. No general monitoring 17.266 Let us start in paragraph (8) with the uncontroversial part. Since the Directive is based on the need for service providers and copyright holders to cooperate it is logical that an exchange of information is organised. Member States are therefore tasked by putting in place rules that: provide that online content-sharing service providers provide rightholders, at their request, with adequate information on the functioning of their practices with regard to the cooperation referred to in paragraph 4 and, where licensing agreements are concluded between service providers and rightholders, information on the use of content covered by the agreements.

More controversy is created by the concept of a general monitoring obligation.353 Paragraph (8) states that the application of this Article shall not lead to such a general monitoring obligation and the danger on this point clearly comes from the system put in place in paragraph 4 of Article 17. There is no general monitoring obligation because paragraph (4) merely imposes the monitoring of uploaded data for specific subject matter.354 That specific subject matter has been notified to the service provider by the copyright holder. Such a system is fundamentally different from a general monitoring system, as the latter would require the service provider to look out for all copyright protected works without specifying and identifying specific copyright works. That is the kind of obligation that Sabam was looking for and which the Court of Justice of the European Union rules out.355 The Court saw problems with freedom of expression, freedom to conduct a business and protection of personal data. In the system that is produced in the new Directive the personal data of the uploader will not be shared with the copyright holder and paragraph (7) allows for a careful balance with other fundamental rights to be struck inside the regime of copyright exceptions and limitations.356 It is also arguable that the prohibition covers the screening of the totality of the content on a platform. The rightholder notifications under Article 17(4)(b) and (c) must be specific, not only in respect of works and other protected subject matter, but also in respect of the circle of potential infringers belonging to the audience of the content platform at issue.357

8. The complaint and redress mechanism 17.267 Even if the system allows proper space for exceptions and limitations and a balancing act, it remains the case that the exclusive right is the starting point and that there will be cases where service providers will not have authorisations in place. In those cases there will be notifications that result in works being made unavailable where this should not happen. The uploading user may have the benefit of an exception or limitation that has not been acknowledged by the service provider, the notification may have been submitted by a party that is not the copyright holder, etc. The system is

353 354 355

356 357

M. Senftleben, note 342 and Quintais, note 306. Grisse, note 292, at 897. Case C-360/10 Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v Netlog NV ECLI:EU:C:2012:85 and Case C-70/10 Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) ECLI:EU:C:2011:771. Case C-469/17 Funke Medien NRW GmbH v Bundesrepublik Deutschland ECLI:EU:C:2019:623 and Case C-516/17 Spiegel Online GmbH v Volker Beck ECLI:EU:C:2019:625. M. Senftleben and Ch. Angelopoulos, ‘The Implementation of Article 17 CDSMD in EU Member States and the Evolution of the Digital Services Act: Why the Ban on General Monitoring Obligations Must Not Be Underestimated’, https://ipkitten.blogspot.com/2020/11/guest-post-implementation-of-article-17.html and ‘The Odyssey of the Prohibition on General Monitoring Obligations on the Way to the Digital Services Act: Between Article 15 of the E-Commerce Directive and Article 17 of the Directive on Copyright in the Digital Single Market’ https:// poseidon01.ssrn.com/delivery.php?ID=0051060861021180640261170700910660070190380810780580070680060690 000790210710980780181100370050401020301141030060040190690810870220150860300510281090810851270951 22124066066084092001098073097114120094077027002096108101107085103090023099111028030115005073&E XT=pdf.

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therefore not complete without a complaint and redress mechanism for the user. That mechanism is provided by paragraph (9). Striking the balance right is one thing, but in the same way the copyright holder needs to be able to have the work made unavailable to avoid irreparable harm, the user is entitled to an expeditious and effective mechanism to restore access in the appropriate cases in order to preserve his or her interests.358 It is after all this mechanism that will provide the teeth to paragraph (7) and that will ensure respect for the limitations and exceptions and the proper balance of rights and interests. Paragraph (9) is therefore corrective in nature and will operate once the work or content has been blocked or has been made unavailable.359 That is confirmed by the use of the present perfect tense in Recital 70, paragraph two, first sentence: Online content-sharing service providers should also put in place effective and expeditious complaint and redress mechanisms allowing users to complain about the steps taken with regard to their uploads, in particular where they could benefit from an exception or limitation to copyright in relation to an upload to which access has been disabled or that has been removed.360

The mechanism shall operate in the event of disputes over the disabling of access to, or the removal 17.268 of, works or other subject matter uploaded by the user. Paragraph (9) makes it also clear that complaints submitted under the mechanism shall be processed without undue delay, and decisions to disable access to or remove uploaded content shall be subject to human review. This guarantees the protection of the rights and interests of the user. There is also a deliberate attempt to avoid overblocking. Rightholders must duly justify the reasons for their request. And let us on the other hand not forget that the whole system of Article 17 is based on building cooperation and trust between service providers and copyright holders.361 A properly functioning system is also in the interest of the copyright holder. That will encourage also the paid-for use of works by users, and an endless stream of badly justified blocking requests will be costly for the copyright holder, both in financial terms and in terms of reputation and respect for the copyright system as a whole. The copyright holder is therefore encouraged to refrain from undue action and to respect the uses of the work by the uploaders.362 The proper functioning of the system is further encouraged by the obligation for service providers to ‘inform their users in their terms and conditions that they can use works and other subject matter under exceptions or limitations to copyright and related rights provided for in Union law’.363 Such a complaint and redress mechanism that is free, expeditious, straightforward and efficient 17.269 should be an asset for users and there is no sensible reason to assume it will not be used.364 Service providers also have an interest in making it work efficiently, as on the one hand they rely on user uploads in their business models, but one should on the other hand not forget either that they have a contract with the users to provide a properly functioning service that includes the option to upload materials as an essential element. National courts have already started to enforce that obligation where providers imposed undue restrictions.365 Users can therefore ask for their deleted content to be reinstated or to allow blocked content.366

358 359 360 361 362 363 364 365 366

Quintais et al, note 336. ALAI (V. Castro Rosa, M. Ficsor, J. Ginsburg, F. Gotzen, A. Quaedvlieg, J. Rosén, J. Seignette, P. Sirinelli, P. Torremans, S. von Lewinski, M. Walter), note 330, para. 5. Directive 2019/790, Recital 70. Our italics. Quintais et al, note 336. Ibid. Directive 2019/790, Art. 17, para. (9). Metzger and Senftleben (on behalf of the European Copyright Society), note 308, p. 17. OLG München, 17 July 2018 – 18 W 858/18, [2018] GRUR-RS 17447, paragraph 16ff; OLG München, 24 August 2018 – 18 W 1294/18, [2019] AfP 57; OLG Oldenburg, 1 July 2019 – 13 W16/19. Grisse, note 292, at 899.

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17.270 On top of all this there will be out-of-court redress mechanisms for the settlement of disputes and judicial remedies as a last resort. Member States shall ensure that users have access to a court or another relevant judicial authority to assert the use of an exception or limitation to copyright and related rights. 17.271 Finally, the combination of a notification system and the corrective mechanism also protects users from themselves. Reckless actions by users could involve liability and by avoiding these cases finding their way directly to a court all parties can avoid unforeseen consequences and costs.367 17.272 It is regrettable that the European legislator has not addressed the issue of private international law that arises from the implementation of Article 17. There will after all be 27 (slightly) different national laws implementing it and this is to be contrasted with the fact that service providers on the internet will necessarily operate on a cross-border basis. That brings us to Article 8(1) Rome II Regulation, as we are dealing with the infringement of intellectual property. That article imposes the country-by-country application of the law of the country for which protection is sought and service providers run therefore the risk of having to comply with 27 national laws, with the added complication that the service provider cannot predict where the user will upload which copyright work. They will then in practice comply with the strictest law or try to introduce a country-bycountry approach through geo-blocking. Neither of these solutions is fortuitous.368 The aim is after all a pan-European market for information and cultural expression. With the CLIP group we have proposed an academic solution for such a ubiquitous scenario where the alleged infringement takes place in each and every country. That would lead to the application of a single law, i.e., law of the closest connection: Article 3:603: Ubiquitous infringement (1)

(2)

(3)

In disputes concerned with infringement carried out through ubiquitous media such as the Internet, the court may apply the law of the State having the closest connection with the infringement if the infringement arguably takes place in every State in which the signals can be received. This rule also applies to existence, duration, limitations and scope to the extent that these questions arise as incidental questions in infringement proceedings. In determining which State has the closest connection with the infringement, the court shall take all the relevant factors into account, in particular the following: (a) the infringer’s habitual residence; (b) the infringer’s principal place of business; (c) the place where substantial activities in furtherance of the infringement in its entirety have been carried out; (d) the place where the harm caused by the infringement is substantial in relation to the infringement in its entirety. Notwithstanding the law applicable pursuant to paragraphs 1 and 2, any party may prove that the rules applying in a State or States covered by the dispute differ from the law applicable to the dispute in aspects which are essential for the decision. The court shall apply the different national laws unless this leads to inconsistent results, in which case the differences shall be taken into account in fashioning the remedy.369

In practice this closest connection test will often lead to the application of a law that is closely related to the service provider, whilst preserving exceptions and limitations under other laws, but with the burden of proof shifting to the alleged infringer. Such an approach would also fit in much

367 368 369

ALAI (V. Castro Rosa, M. Ficsor, J. Ginsburg, F. Gotzen, A. Quaedvlieg, J. Rosén, J. Seignette, P. Sirinelli, P. Torremans, S. von Lewinski, M. Walter), note 330, para. 5. Metzger and Senftleben (on behalf of the European Copyright Society), note 308, pp. 19–20. Article 3:603 Principles for Conflict of Laws in Intellectual Property, European Max Planck Group on Conflict of Laws in Intellectual Property, Conflict of Laws in Intellectual Property: The CLIP Principles and Commentary, Oxford University Press (2013).

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better with the stated aim of Article 17 and arguably the Rome II approach would lead to an unworkable outcome in the ubiquitous scenario. It is in this context interesting to note that Advocate General Szpunar refused to rule out the application of a single law in a case dealing with global injunctions as a remedy in an internet/ubiquitous defamation case.370 The CJEU did not comment in any way on the suggestion and defamation is not copyright, but remedies are clearly closely related to infringement. Whatever the court eventually decides, one can at the very least argue that in terms of classification Article 17(9) should not be classified as infringement. That would allow one at the very least to apply a single law to the issue of procedural safeguards.371 One could turn here toward to law of the country of origin, i.e. the law of the country where the service provider deploys its main activity.372

9. The stakeholder dialogue Paragraph (10) puts in place the idea of a stakeholder dialogue to discuss the practical application of 17.273 Article 17. That not merely fits in with the idea to promote cooperation between the parties, it will hopefully also enable the Commission to issue guidance on this point.

NOTES 1. Related instruments Charter of Fundamental Rights of the European Union [2012] OJ C 326/391. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market [2000] OJ L 178/1. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/10. Commission Recommendation 2003/361/EC of 6 May 2003 concerning the definition of micro, small and medium-sized enterprises [2003] OJ L 124/36. Directive (EU) 2018/1972 of the European Parliament and of the Council of 11 December 2018 establishing the European Electronic Communications Code [2018] OJ L 321/36.

2. CJEU case law / national case law Case C-135/10 Società Consortile Fonografici (SCF) v. Marco Del Corso ECLI:EU:C:2012:140. Case C-360/10 Belgische Vereniging van Auteurs, Componisten en Uitgevers CVBA (SABAM) v. Netlog NV ECLI: EU:C:2012:85. Case C-70/10 Scarlet Extended SA v. Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM) ECLI: EU:C:2011:771. Case C-117/15 Reha Training Gesellschaft für Sport- und Unfallrehabilitation mbH v. Gesellschaft für musikalische Aufführungs- und mechanische Vervielfältigungsrechte eV (GEMA) ECLI:EU:C:2016:379. Case C-160/15 GS Media BV v. Sanoma Media Netherlands BV and Others ECLI:EU:C:2016:644. Case C-301/15 Marc Soulier and Sara Doke v. Premier ministre and Ministre de la Culture et de la Communication ECLI:EU:C:2016:878. Case C-527/15 Stichting Brein v. Jack Frederik Wullems ECLI:EU:C:2017:300. Case C-610/15 Stichting Brein v. Ziggo BV and XS4All Internet BV ECLI:EU:C:2017:456. Case C-161/17 Land Nordrhein-Westfalen v. Dirk Renckhoff ECLI:EU:C:2018:634. Case C-469/17 Funke Medien NRW GmbH v. Bundesrepublik Deutschland ECLI:EU:C:2019:623. Case C-516/17 Spiegel Online GmbH v. Volker Beck ECLI:EU:C:2019:625.

370 371 372

Case C-18/18 Eva Glawischnig-Piesczek v. Facebook Ireland Limited ECLI:EU:C:2019:821, Opinion of AG Szpunar ECLI:EU:C:2019:458, at para. 96. Metzger and Senftleben (on behalf of the European Copyright Society), note 308, pp. 19–20. See Art. 3(2) Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market [2000] OJ L 178/1.

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Chapter 17 THE DIGITAL SINGLE MARKET DIRECTIVE Case C-18/18 Eva Glawischnig-Piesczek v. Facebook Ireland Limited ECLI:EU:C:2019:821. Case C-484/18 Société de perception et de distribution des droits des artistes-interprètes de la musique et de la danse (Spedidam) and Others v. Institut national de l’audiovisuel ECLI:EU:C:2019:970. Case C-683/18 Elsevier v. Cyando, pending (http://curia.europa.eu/juris/document/document.jsf?text=&docid= 211268&pageIndex=0&doclang=EN&mode=lst&dir=&occ=first&part=1&cid=772475). Case C-682/18 YouTube, pending (http://curia.europa.eu/juris/fiche.jsf?id=C%3B682%3B18%3BRP%3B1%3BP% 3B1%3BC2018%2F0682%2FP&oqp=&for=&mat=or&lgrec=en&jge=&td=%3BALL&jur=C%2CT%2CF&num= C-682%252F18&dates=&pcs=Oor&lg=&pro=&nat=or&cit=none%252CC%252CCJ%252CR%252C2008E%252 C%252C%252C%252C%252C%252C%252C%252C%252C%252Ctrue%252Cfalse%252Cfalse&language=en&a vg=&cid=40788). Case C-401/19 Republic of Poland v. European Parliament and Council of the European Union, pending (http:// curia.europa.eu/juris/document/document.jsf?text=&docid=216823&pageIndex=0&doclang=EN&mode=lst&dir= &occ=first&part=1&cid=8371710). OLG München, 17 July 2018 – 18 W 858/18, [2018] GRUR-RS 17447. OLG München, 24 August 2018 – 18 W 1294/18, [2019] AfP 57. OLG Oldenburg, 1 July 2019 – 13 W16/19.

3. Bibliography ALAI (V. Castro Rosa, M. Ficsor, J. Ginsburg, F. Gotzen, A. Quaedvlieg, J. Rosén, J. Seignette, P. Sirinelli, P. Torremans, S. von Lewinski, M. Walter), ‘Draft Opinion on certain aspects of the implementation of Article 17 of Directive (EU) 2019/790 of 17 April 2019 on copyright and related rights in the digital single market’, 30 March 2020, https://www.alai.org/en/assets/files/resolutions/200330-opinion-article-17-directive-2019_790-en.pdf. Blassel, P., ‘Eléments relatifs à la transposition de l’article 17 de la Directive sur le droit d’auteur dans le marché unique numérique’, paper delivered at the conference of the Association française pour la protection internationale du droit d’auteur : Actualité internationale, européenne et française du droit d’auteur, 14 February 2020, Paris – Hôtel de Massa. European Max Planck Group on Conflict of Laws in Intellectual Property, Conflict of Laws in Intellectual Property: The CLIP Principles and Commentary, Oxford University Press (2013). Geiger, C., ‘Freedom of Artistic Creativity and Copyright Law: A Compatible Combination?’ (2018) 8 UC Irvine Law Review 413. Geiger, C., ‘Copyright and the Freedom to Create – A Fragile Balance’, (2007) 38 IIC 707. Grisse, K., ‘After the storm – examining the final version of Article 17 of the new Directive (EU) 2019/790’ (2019) 14 Journal of Intellectual Property Law & Practice 887. Husovec, M., ‘How Europe Wants to Redefine Global Online Copyright Enforcement’, in T.- E. Synodinou (ed.), Pluralism or Universalism in International Copyright Law (Kluwer Law International, 2019). Lucas-Schloetter, A., ‘Transfer of Value Provisions of the Draft Copyright Directive’ https://authorsocieties.eu/ content/uploads/2019/10/lucas-schloetter-analysis-copyright-directive-en.pdf. Metzger, A. and M. Senftleben (on behalf of the European Copyright Society), ‘Comment of the European Copyright Society on Selected Aspects of Implementing Article 17 of the Directive on Copyright in the Digital Single Market into National Law’ https://europeancopyrightsocietydotorg.files.wordpress.com/2020/04/ecs-comment-article-17cdsm.pdf. Peifer, K-N., ‘Sharing-Plattformbetreiberhaftung im Urheberrecht (Art. 17 DSM-RL)’ (2019) 11 GRUR-Prax 403. Quintais, J. et al, ‘Safeguarding User Freedoms in Implementing Article 17 of the Copyright in the Digital Single Market Directive: Recommendations from European Academics’, https://www.ivir.nl/recommendationsarticle17/. Quintais, J., ‘The New Copyright in the Digital Single Market Directive: A Critical Look’ (2020) 42(1) European Intellectual Property Review 28–41. Schwemer, S. F. and J. Schovsbo, ‘What Is Left of User Rights: Algorithmic Copyright Enforcement and Free Speech in the Light of the Article 17 Regime’, in P. Torremans (ed.), Intellectual Property and Human Rights (Kluwer Law International, 4th ed., 2020), 569. Senftleben, M., ‘Bermuda Triangle – Licensing, Filtering and Privileging User-Generated Content Under the New Directive on Copyright in the Digital Single Market’ (2019) 41(8) European Intellectual Property Review 480–90. Senftleben, M. and Ch. Angelopoulos, ‘The Implementation of Article 17 CDSMD in EU Member States and the Evolution of the Digital Services Act: Why the Ban on General Monitoring Obligations Must Not Be Underestimated’, https://ipkitten.blogspot.com/2020/11/guest-post-implementation-of-article-17.html. Senftleben, M. and Ch. Angelopoulos, ‘The Odyssey of the Prohibition on General Monitoring Obligations on the Way to the Digital Services Act: Between Article 15 of the E-Commerce Directive and Article 17 of the Directive

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ARTICLE 18: PRINCIPLE OF APPROPRIATE AND PROPORTIONATE REMUNERATION on Copyright in the Digital Single Market’ https://poseidon01.ssrn.com/delivery.php?ID=00510608610211806402 61170700910660070190380810780580070680060690000790210710980780181100370050401020301141030060 04019069081087022015086030051028109081085127095122124066066084092001098073097114120094077027 002096108101107085103090023099111028030115005073&EXT=pdf. Sirinelli, P. and S. Dormont, ‘Services automatisés de référencement d’images – Rapport et proposition de modification législative’, Ministère de la Culture et de la Communication, Conseil Supérieur de la Propriété Littéraire et Artistique (2019). Sirinelli, P., ‘Soumission au droit d’auteur des services de référencement d’images des moteurs de recherche’, paper delivered at the conference of the Association française pour la protection internationale du droit d’auteur: Actualité internationale, européenne et française du droit d’auteur, 14 February 2020, Paris – Hôtel de Massa. Spina Alì, G., ‘Intellectual Property and Human Rights: A Taxonomy of Their Interactions’ (2020) 51 IIC 411–45. Stalla-Bourdillon, Sophie, Eleonora Rosati, Karmen Turk et al., ‘A Brief Exegesis of the Proposed Copyright Directive’ (24 November 2016), https://ssrn.com/abstract=287529. Stamatoudi, I., ‘Copyright Enforcement and the role of Internet Service Providers’, in P. Torremans (ed.), The EU Enforcement Directive (Edward Elgar Publishing, 2014) 789. Synodinou, T., ‘Wider implications of the CJEU’s case law on other fundamental rights: Is the freedom of expression the only ‘victim’ of Spiegel Online?’, presentation at the 6th Annual Conference on Media and Communication Law: Digital Platforms & Social Media: Legislative Developments & Current Challenges, Athens 7 February 2020. Wandtke, A., ‘Grundsätze der Richtlinie über das Urheberrecht im digitalen Binnenmarkt’ (2019) 72 NJW 1841. Wimmers, J. and M. Barudi, ‘Der Mythos vom Value Gap’ (2017) 119 GRUR 327.

CHAPTER 3 FAIR REMUNERATION IN EXPLOITATION CONTRACTS OF AUTHORS AND PERFORMERS ARTICLE 18: PRINCIPLE OF APPROPRIATE AND PROPORTIONATE REMUNERATION 1. 2.

Member States shall ensure that where authors and performers license or transfer their exclusive rights for the exploitation of their works or other subject matter, they are entitled to receive appropriate and proportionate remuneration. In the implementation in national law of the principle set out in paragraph 1, Member States shall be free to use different mechanisms and take into account the principle of contractual freedom and a fair balance of rights and interests.

I. COMMENTARY Chapter 3 of title IV turns its attention to fair remuneration in the exploitation contracts of authors 17.274 and performers. Authors and performers are often the weaker party and situations where the parties to these exploitation contracts have level bargaining power are the exception, rather than the norm. If one is looking for a link between Article 17 and what follows, one could say that Article 17 brings in more remuneration for rightholders and that what follows tries to ensure that this larger pie is shared more equally between exploitation companies such as publishers and film studios on the one hand and authors and performers on the other hand.373

373

See Ananay Aguilar, ‘The New Copyright Directive: Fair remuneration in exploitation contracts of authors and performers – Part 1, Articles 18 and 19’ (15 July 2019) Kluwer Copyright Blog, http://copyrightblog.kluweriplaw.com/ 2019/07/15/the-new-copyright-directive-fair-remuneration-in-exploitationcontracts-of-authors-and-performers-part1-articles-18-and-19/.

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17.275 The starting point is found in Article 18, which sets out a principle of appropriate and proportionate remuneration for authors and performers who license their works or subject matter. The key words here are appropriate and proportionate. Appropriate must mean that the remuneration can take various forms, but that each of these forms must fit in with the particular exploitation, e.g., the exploitation itself may only gradually generate income which makes advance payments less appropriate. Recital 73 accepts a lump sum payment in this respect but says also that it should not be the rule. That is understood easily if one adds that the remuneration must be proportionate. Again, one looks at the circumstances in which the exploitation takes place, but there are also two important benchmarks here. The top benchmark is the complete economic value of what is licensed. But the exploiting party may have to invest significant amounts to bring the work to the market (e.g., turn a very rough manuscript into a high-quality book) and the exploitation may only focus on a niche market. That brings in proportionality in relation to the revenues generated by the exploitation of the work as a second benchmark.374 The provision leaves Member States discretion on which mechanism to choose when implementing the principle, subject to conformity with EU law.375 Contractual freedom remains also a key element, as well as the fair balance of rights and obligations. Different traditions in different Member States will no doubt result in different approaches when implementing this provision and contractual deals between the parties will play an important role, but ultimately there must be a mechanism to check whether an appropriate and proportional level of remuneration has been achieved.

NOTES 1. Bibliography Aguilar, A. ‘The New Copyright Directive: Fair remuneration in exploitation contracts of authors and performers – Part 1, Articles 18 and 19’ (15 July 2019) Kluwer Copyright Blog, http://copyrightblog.kluweriplaw.com/2019/ 07 /15 / the-new-copyright-directive-fair-remuneration-in- exploitationcontracts-of-authors-and-performers-part1-articles-18-and-19/. J. Quintais, ‘The New Copyright in the Digital Single Market Directive: A Critical Look’ (2020) 42(1) European Intellectual Property Review 28–41.

ARTICLE 19: TRANSPARENCY OBLIGATION 1.

2.

374 375

Member States shall ensure that authors and performers receive on a regular basis, at least once a year, and taking into account the specificities of each sector, up to date, relevant and comprehensive information on the exploitation of their works and performances from the parties to whom they have licensed or transferred their rights, or their successors in title, in particular as regards modes of exploitation, all revenues generated and remuneration due. Member States shall ensure that, where the rights referred to in paragraph 1 have subsequently been licensed, authors and performers or their representatives shall, at their request, receive from sub-licensees additional information, in the event that their first contractual counterpart does not hold all the information that would be necessary for the purposes of paragraph 1. Where that additional information is requested, the first contractual counterpart of authors and performers shall provide information on the identity of those sub-licensees. Member States may provide that any request to sub-licensees pursuant to the first

Directive 2019/790, Recital 73. Quintais, note 306.

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3.

4.

5.

6.

subparagraph is made directly or indirectly through the contractual counterpart of the author or the performer. The obligation set out in paragraph 1 shall be proportionate and effective in ensuring a high level of transparency in every sector. Member States may provide that in duly justified cases where the administrative burden resulting from the obligation set out in paragraph 1 would become disproportionate in the light of the revenues generated by the exploitation of the work or performance, the obligation is limited to the types and level of information that can reasonably be expected in such cases. Member States may decide that the obligation set out in paragraph 1 of this Article does not apply when the contribution of the author or performer is not significant having regard to the overall work or performance, unless the author or performer demonstrates that he or she requires the information for the exercise of his or her rights under Article 20(1) and requests the information for that purpose. Member States may provide that, for agreements subject to or based on collective bargaining agreements, the transparency rules of the relevant collective bargaining agreement are applicable, on condition that those rules meet the criteria provided for in paragraphs 1 to 4. Where Article 18 of Directive 2014/26/EU is applicable, the obligation laid down in paragraph 1 of this Article shall not apply in respect of agreements concluded by entities defined in Article 3(a) and (b) of that Directive or by other entities subject to the national rules implementing that Directive.

I. COMMENTARY In a second step, Article 19 lays down a transparency obligation. In compliance with this obligation, 17.276 creators must receive on a regular basis, and at least annually and taking into account the specificities of each sector, detailed information on the exploitation of their works or performances from their licensors or transferors. This includes information on modes of exploitation, revenues generated and remuneration due.376 Subject to certain conditions, essentially when that information is not otherwise available, additional information may be requested from sub-licensees, whose identity must be revealed by the first contractual partner. Member States have the option to channel such requests directly or indirectly through the first contractual partner of the author or performer.377 This transparency obligation is an important step forward, as creators and performers need an insight into the revenues that are generated to check that they are correctly rewarded. At present that information is often not readily and clearly made available to them.378 The objective is to ensure a high level of transparency in each sector and in that respect the 17.277 obligation must be proportionate and effective, but the transparency obligation can be limited in cases where it is deemed disproportionate. In some cases, it can be set aside if the creator’s contribution to the overall work/performance is ‘not significant’.379 Digital management and accounting make matters simpler, so there should be fewer circumstances in which the obligation becomes disproportionate. In addition, Member States may decide that (only) transparency rules in collective bargaining 17.278 agreements apply, provided they meet the criteria set forth in the first four paragraphs of Article 19.

376 377 378 379

See also Recitals 75–77 of Directive 2019/790. Quintais, note 306. Aguilar, note 373. An exception is made for the contract adjustment mechanism laid down in Art. 20(1).

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This is a positive point and a collective bargaining process will almost inevitably strengthen the traditionally weak bargaining position of authors and performers. And finally, CMOs and ‘independent management entities’ that are already subject to a similar obligation under Article 18 CRM Directive and national laws implementing it are not subject to this transparency obligation.380

NOTES 1. Related instruments Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market [2014] OJ L 84/72.

2. Bibliography Ananay Aguilar, ‘The New Copyright Directive: Fair remuneration in exploitation contracts of authors and performers – Part 1, Articles 18 and 19’ (15 July 2019) Kluwer Copyright Blog, http://copyrightblog.kluweriplaw.com/2019/ 07/15/the-new-copyright-directive-fair-remuneration-in-exploitationcontracts-of-authors-and-performers-part-1articles-18-and-19/. J. Quintais, ‘The New Copyright in the Digital Single Market Directive: A Critical Look’ (2020) 42(1) European Intellectual Property Review 28–41.

ARTICLE 20: CONTRACT ADJUSTMENT MECHANISM 1.

2.

Member States shall ensure that, in the absence of an applicable collective bargaining agreement providing for a mechanism comparable to that set out in this Article, authors and performers or their representatives are entitled to claim additional, appropriate and fair remuneration from the party with whom they entered into a contract for the exploitation of their rights, or from the successors in title of such party, when the remuneration originally agreed turns out to be disproportionately low compared to all the subsequent relevant revenues derived from the exploitation of the works or performances. Paragraph 1 of this Article shall not apply to agreements concluded by entities defined in Article 3(a) and (b) of Directive 2014/26/EU or by other entities that are already subject to the national rules implementing that Directive.

I. COMMENTARY 17.279 In a third step, Article 20 entitles authors and performers to a contract adjustment mechanism. They can claim ‘additional, appropriate and fair remuneration’ from their counterparty (or its successors in title) if their initially agreed remuneration turns out to be disproportionately low381 as compared to the revenues generated by the subsequent exploitation of the works or performances by the contractual counterpart.382 Collective bargaining agreements can provide a mechanism for this task and, if they exist, they take precedence.383 This is another point on which the Directive rightly

380

381 382 383

See also Recital 77 DSM Directive (in fine). Art. 18 CRM Directive deals with ‘Information provided to rightholders on the management of their rights’, Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market [2014] OJ L 84/72. Directive 2019/790, Art. 20(1). Ibid., Recital 78 provides guidance on how to make such an assessment. Ibid., Art. 20(2).

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ARTICLE 21: ALTERNATIVE DISPUTE RESOLUTION PROCEDURE

encourages collective bargaining agreements, as they can overcome the uneven level in bargaining position, strengthen the position of the authors and performers and increase their chances of obtaining an adjustment. Importantly, the mechanism does not apply to agreements concluded by CMOs or ‘independent management entities’, as they are subject to national rules implementing the CRM Directive.384

NOTES 1. Related instruments Directive 2014/26/EU of the European Parliament and of the Council of 26 February 2014 on collective management of copyright and related rights and multi-territorial licensing of rights in musical works for online use in the internal market [2014] OJ L 84/72.

2. Bibliography J. Quintais, ‘The New Copyright in the Digital Single Market Directive: A Critical Look’ (2020) 42(1) European Intellectual Property Review 28–41.

ARTICLE 21: ALTERNATIVE DISPUTE RESOLUTION PROCEDURE Member States shall provide that disputes concerning the transparency obligation under Article 19 and the contract adjustment mechanism under Article 20 may be submitted to a voluntary, alternative dispute resolution procedure. Member States shall ensure that representative organisations of authors and performers may initiate such procedures at the specific request of one or more authors or performers.

I. COMMENTARY In a fourth step the Directive addresses the problem that authors and performers are often reluctant 17.280 to go to court, because of the cost barrier and their overall weaker position.385 Article 21 therefore provides the option to submit disputes concerning the transparency obligation and the contract adjustment mechanism to a voluntary alternative dispute resolution procedure, which may be initiated by a CMO at the request of an author or performer it represents.386

NOTES 1. Bibliography J. Quintais, ‘The New Copyright in the Digital Single Market Directive: A Critical Look’ (2020) 42(1) European Intellectual Property Review 28–41.

384 385 386

Quintais, note 306. Directive 2019/790, Recital 79. Quintais, note 306.

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ARTICLE 22: RIGHT OF REVOCATION 1.

2.

3.

4. 5.

Member States shall ensure that where an author or a performer has licensed or transferred his or her rights in a work or other protected subject matter on an exclusive basis, the author or performer may revoke in whole or in part the licence or the transfer of rights where there is a lack of exploitation of that work or other protected subject matter. Specific provisions for the revocation mechanism provided for in paragraph 1 may be provided for in national law, taking into account the following: (a) the specificities of the different sectors and the different types of works and performances; and (b) where a work or other subject matter contains the contribution of more than one author or performer, the relative importance of the individual contributions, and the legitimate interests of all authors and performers affected by the application of the revocation mechanism by an individual author or performer. Member States may exclude works or other subject matter from the application of the revocation mechanism if such works or other subject matter usually contain contributions of a plurality of authors or performers. Member States may provide that the revocation mechanism can only apply within a specific time frame, where such restriction is duly justified by the specificities of the sector or of the type of work or other subject matter concerned. Member States may provide that authors or performers can choose to terminate the exclusivity of the contract instead of revoking the licence or transfer of the rights. Member States shall provide that the revocation provided for in paragraph 1 may only be exercised after a reasonable time following the conclusion of the licence or the transfer of the rights. The author or performer shall notify the person to whom the rights have been licensed or transferred and set an appropriate deadline by which the exploitation of the licensed or transferred rights is to take place. After the expiry of that deadline, the author or performer may choose to terminate the exclusivity of the contract instead of revoking the licence or the transfer of the rights. Paragraph 1 shall not apply if the lack of exploitation is predominantly due to circumstances that the author or the performer can reasonably be expected to remedy. Member States may provide that any contractual provision derogating from the revocation mechanism provided for in paragraph 1 is enforceable only if it is based on a collective bargaining agreement.

I. COMMENTARY 17.281 The fifth step is found in Article 22 and gives authors and creators a right of revocation. That right applies when the rights in a work have been licensed or transferred on an exclusive basis on the grounds of a lack of exploitation of the work or subject matter that has been licensed or transferred. The revocation may also be a partial revocation. It will not apply if such lack of exploitation is due to circumstances that the creator ‘can reasonably be expected to remedy’.387 17.282 The Directive leaves it to national law to put in place the precise mechanism for the revocation, but it identifies a number of factors national laws should consider if they set out specific provisions for the revocation mechanisms. These include sector specificities, the relative importance of individual contributions in collective or joint works, as well as legitimate interests of other affected creators. Member States may even decide to exclude the application of the revocation mechanism completely

387

Paras (1) and (4) and Recital 80 to Directive 2019/790.

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ARTICLE 23: COMMON PROVISIONS

for works or subject matter that usually contain contributions from a plurality of creators.388 In certain circumstances Member States can provide that the mechanism can only apply within a certain time frame and they can give the author or performer the option to go for the termination of exclusivity instead of revocation.389 The right of revocation can only be exercised after a reasonable time, starting from the conclusion of 17.283 the contract to give the licensee or assignee the time to get the exploitation going. And the author or performer needs to set a deadline for the start of exploitation and give proper notice.390 Contractual provisions that overrule the mechanism are not ruled out by the Directive, but Member States are given the option to make derogations only possible and enforceable if they are based on a collective bargaining agreement.391 Member States should be encouraged to make use of this option in order to eliminate the risk that the weak bargaining position of authors and performers results consistently in them being deprived of this rather minimalistic right of revocation.

NOTES 1. Bibliography J. Quintais, ‘The New Copyright in the Digital Single Market Directive: A Critical Look’ (2020) 42(1) European Intellectual Property Review 28–41.

ARTICLE 23: COMMON PROVISIONS 1. 2.

Member States shall ensure that any contractual provision that prevents compliance with Articles 19, 20 and 21 shall be unenforceable in relation to authors and performers. Members States shall provide that Articles 18 to 22 of this Directive do not apply to authors of a computer program within the meaning of Article 2 of Directive 2009/24/EC.

I. COMMENTARY Finally, Article 23 is entitled ‘common provisions’. It provides that any contractual provision that 17.284 prevents compliance with Articles 19–21, or in practice with the transparency obligation, the contract adjustment mechanism and the alternative dispute resolution procedure, is unenforceable vis-à-vis authors and performers. These articles do in other words contain mandatory provisions that cannot be derogated from by contract, whether between creators and their contractual counterparts, or between those counterparts and third parties.392 Recital 81 gives in that respect the example of non-disclosure agreement.393 As noted above, the right of revocation is not covered and can therefore be derogated from by contract in certain circumstances.

388 389 390 391 392 393

Para. (2). Quintais, note 306. Para. (3). Para. (5). J. Quintais, ‘The New Copyright in the Digital Single Market Directive: A Critical Look’ (2020) European Intellectual Property Review 42(1), 28–41. Recital 80 to Directive 2019/790.

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NOTES 1. Bibliography J. Quintais, ‘The New Copyright in the Digital Single Market Directive: A Critical Look’ (2020) European Intellectual Property Review 42(1), 28–41.

TITLE V: FINAL PROVISIONS ARTICLE 24: AMENDMENTS TO DIRECTIVES 96/9/EC AND 2001/29/EC 1.

2.

Directive 96/9/EC is amended as follows: (a) In Article 6(2), point (b) is replaced by the following: ‘(b) where there is use for the sole purpose of illustration for teaching or scientific research, as long as the source is indicated and to the extent justified by the non-commercial purpose to be achieved, without prejudice to the exceptions and limitations provided for in Directive (EU) 2019/790 of the European Parliament and of the Council; (b) In Article 9, point (b) is replaced by the following: ‘(b) in the case of extraction for the purposes of illustration for teaching or scientific research, as long as the source is indicated and to the extent justified by the non-commercial purpose to be achieved, without prejudice to the exceptions and limitations provided for in Directive (EU) 2019/790;’. Directive 2001/29/EC is amended as follows: (a) In Article 5(2), point (c) is replaced by the following: ‘(c) in respect of specific acts of reproduction made by publicly accessible libraries, educational establishments or museums, or by archives, which are not for direct or indirect economic or commercial advantage, without prejudice to the exceptions and limitations provided for in Directive (EU) 2019/790 of the European Parliament and of the Council;’. (b) In Article 5(3), point (a) is replaced by the following: ‘(a) use for the sole purpose of illustration for teaching or scientific research, as long as the source, including the author’s name, is indicated, unless this turns out to be impossible and to the extent justified by the non-commercial purpose to be achieved, without prejudice to the exceptions and limitations provided for in Directive (EU) 2019/790;’. (c) In Article 12(4), the following points are added: ‘(e) to examine the impact of the transposition of Directive (EU) 2019/790 on the functioning of the internal market and to highlight any transposition difficulties; (f) to facilitate the exchange of information on relevant developments in legislation and case law as well as on the practical application of the measures taken by Member States to implement Directive (EU) 2019/790; (g) to discuss any other questions arising from the application of Directive (EU) 2019/790.’.

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ARTICLE 26: APPLICATION IN TIME

I. COMMENTARY The final provisions to the Directive contain the usual ingredients. First of all, there are some 17.285 changes to a couple of existing Directives.394 The exceptions to the restricted acts in the Database Directive get a new Article 6(2)(b) where a without prejudice clause for the exceptions and limitations in this new Directive has been added.395 The same is done for the exceptions and limitations in Articles 5(2) and (3) of Directive 2001/29/EC. And in Article 12(4) of the latter Directive this new Directive is added to the brief of the review Committee.396

NOTES 1. Related instruments Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases [1996] OJ L 77/20. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/10.

ARTICLE 25: RELATIONSHIP WITH EXCEPTIONS AND LIMITATIONS PROVIDED FOR IN OTHER DIRECTIVES Member States may adopt or maintain in force broader provisions, compatible with the exceptions and limitations provided for in Directives 96/9/EC and 2001/29/EC, for uses or fields covered by the exceptions or limitations provided for in this Directive.

I. COMMENTARY Wider exceptions provided for in other Directives can be put or remain in force.397

17.286

ARTICLE 26: APPLICATION IN TIME 1. 2.

394 395 396 397

This Directive shall apply in respect of all works and other subject matter that are protected by national law in the field of copyright on or after 7 June 2021. This Directive shall apply without prejudice to any acts concluded and rights acquired before 7 June 2021.

Art. 24 Directive 2019/790. Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases [1996] OJ L 77/20. Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L 167/10. Art. 25 Directive 2019/790.

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ARTICLE 27: TRANSITIONAL PROVISION Agreements for the licence or transfer of rights of authors and performers shall be subject to the transparency obligation set out in Article 19 as from 7 June 2022.

I. COMMENTARY 17.287 The Directive will cover works and other materials that are protected by national copyright law on or after 7 June 2021. The Directive applies to acts concluded and to rights acquired before that date without prejudice.398 The transparency obligation applies however to the relevant agreements from 7 June 2022 onwards.399

ARTICLE 28: PROTECTION OF PERSONAL DATA The processing of personal data carried out within the framework of this Directive shall be carried out in compliance with Directive 2002/58/EC and Regulation (EU) 2016/679.

I. COMMENTARY 17.288 In relation to the protection of personal data the Directive on privacy and electronic communications400 and the GDPR401 apply.402

NOTES 1. Related instruments Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector [2002] OJ L 201/37. Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC [2016] OJ L 119/1.

ARTICLE 29: TRANSPOSITION 1.

398 399 400 401

402

Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 7 June 2021. They shall immediately inform the Commission thereof.

Directive 2019/790, Art. 26. Ibid., Art. 27. Directive 2002/58/EC of the European Parliament and of the Council of 12 July 2002 concerning the processing of personal data and the protection of privacy in the electronic communications sector [2002] OJ L 201/37. Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC [2016] OJ L 119/1. Directive 2019/790, Art. 28.

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ARTICLE 32: ADDRESSEES

2.

When Member States adopt those provisions, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. The methods of making such reference shall be laid down by Member States. Member States shall communicate to the Commission the text of the main provisions of national law which they adopt in the field covered by this Directive.

ARTICLE 30: REVIEW 1.

2.

No sooner than 7 June 2026, the Commission shall carry out a review of this Directive and present a report on the main findings to the European Parliament, the Council and the European Economic and Social Committee. The Commission shall, by 7 June 2024, assess the impact of the specific liability regime set out in Article 17 applicable to online content-sharing service providers that have an annual turnover of less than EUR 10 million and the services of which have been available to the public in the Union for less than three years under Article 17(6) and, if appropriate, take action in accordance with the conclusions of its assessment. Member States shall provide the Commission with the necessary information for the preparation of the report referred to in paragraph 1.

ARTICLE 31: ENTRY INTO FORCE This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.

ARTICLE 32: ADDRESSEES This Directive is addressed to the Member States.

I. COMMENTARY The Member States have until 7 June 2021 to transpose the provisions of the Directive into their 17.289 national laws.403 A review clause plans a review five years later, but Article 17 will be reviewed after three years.404 The Directive has already entered into force.405

403 404 405

Ibid., Art. 29. Ibid., Art. 30. Ibid., Art. 31.

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18 ACCESS AND RE-USE OF PUBLIC SECTOR INFORMATION IN A COPYRIGHT PERSPECTIVE Cristiana Sappa DIRECTIVE (EU) 2019/1024 of the European Parliament and of the Council of 20 June 2019 on open data and the re-use of public sector information

PE/28/2019/REV/1 [2019] OJ L 172/56 CHAPTER I: GENERAL PROVISIONS

ARTICLE 9: PRACTICAL ARRANGEMENTS

ARTICLE 1: SUBJECT MATTER AND SCOPE

ARTICLE 10: RESEARCH DATA

ARTICLE 2: DEFINITIONS

I.

ARTICLE 3: GENERAL PRINCIPLE

II. THE EU LEGAL FRAMEWORK ON PSI RE-USE 18.10

CHAPTER II: REQUESTS FOR RE-USE

III. PSI AS SUBJECT MATTER OF COPYRIGHT

18.15

ARTICLE 4: PROCESSING OF REQUESTS FOR RE-USE

IV. COPYRIGHTABLE PSI: WHO OWNS THE RIGHTS?

18.19

CHAPTER III: CONDITIONS FOR RE-USE ARTICLE 5: AVAILABLE FORMATS ARTICLE 6: PRINCIPLES GOVERNING CHARGING ARTICLE 7: TRANSPARENCY

INTRODUCTORY REMARKS

18.01

V. EXCEPTIONS AND LIMITATIONS

18.23

VI. LICENCES

18.26

VII. CONCLUSIONS

18.31

ARTICLE 8: STANDARD LICENCES

SELECTED RECITALS (54) The intellectual property rights of third parties are not affected by this Directive. For the avoidance of doubt, the term ‘intellectual property rights’ refers to copyright and related rights only, including sui generis forms of protection. This Directive does not apply to documents covered by industrial property rights, such as patents and registered designs and trade marks. The Directive neither affects the existence or ownership of intellectual property rights of public sector bodies, nor does it limit the exercise of these rights in any way beyond the boundaries set by this Directive. The obligations imposed in accordance with this Directive should apply only insofar as they are compatible with international agreements on the protection of intellectual property rights, in particular the Berne Convention for the Protection of Literary and Artistic Works (Berne Convention), the Agreement on Trade-Related Aspects of Intellectual Property

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ARTICLE 1: SUBJECT MATTER AND SCOPE

Rights (TRIPS Agreement) and the WIPO Copyright Treaty (WCT). Public sector bodies should, however, exercise their copyright in a way that facilitates re-use. (55) Taking into account Union law and the international obligations of Member States and of the Union, particularly under the Berne Convention and the TRIPS Agreement, documents for which third parties hold intellectual property rights should be excluded from the scope of this Directive. If a third party was the initial owner of the intellectual property rights for a document held by libraries, including university libraries, museums and archives and the term of protection of those rights has not expired, that document should, for the purpose of this Directive, be considered to be a document for which third parties hold intellectual property rights.

CHAPTER I GENERAL PROVISIONS ARTICLE 1: SUBJECT MATTER AND SCOPE 1.

2.

In order to promote the use of open data and stimulate innovation in products and services, this Directive establishes a set of minimum rules governing the re-use and the practical arrangements for facilitating the re-use of: (a) existing documents held by public sector bodies of the Member States; (b) existing documents held by public undertakings that are: (i) active in the areas defined in Directive 2014/25/EU; (ii) acting as public service operators pursuant to Article 2 of Regulation (EC) No 1370/2007; (iii) acting as air carriers fulfilling public service obligations pursuant to Article 16 of Regulation (EC) No 1008/2008; or (iv) acting as Community shipowners fulfilling public service obligations pursuant to Article 4 of Regulation (EEC) No 3577/92; (c) research data pursuant to the conditions set out in Article 10. This Directive does not apply to: (a) documents the supply of which is an activity falling outside the scope of the public task of the public sector bodies concerned as defined by law or by other binding rules in the Member State, or, in the absence of such rules, as defined in accordance with common administrative practice in the Member State in question, provided that the scope of the public tasks is transparent and subject to review; (b) documents held by public undertakings: (i) produced outside the scope of the provision of services in the general interest as defined by law or other binding rules in the Member State; (ii) related to activities directly exposed to competition and therefore, pursuant to Article 34 of Directive 2014/25/EU, not subject to procurement rules; (c) documents for which third parties hold intellectual property rights; (d) documents, such as sensitive data, which are excluded from access by virtue of the access regimes in the Member State, including on grounds of: (i) the protection of national security (namely, State security), defence, or public security; (ii) statistical confidentiality; (iii) commercial confidentiality (including business, professional or company secrets);

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Chapter 18 ACCESS AND RE-USE OF PUBLIC SECTOR INFORMATION IN A COPYRIGHT PERSPECTIVE

3. 4. 5.

6. 7.

(e) documents access to which is excluded or restricted on grounds of sensitive critical infrastructure protection related information as defined in point (d) of Article 2 of Directive 2008/114/EC; (f) documents access to which is restricted by virtue of the access regimes in the Member States, including cases whereby citizens or legal entities have to prove a particular interest to obtain access to documents; (g) logos, crests and insignia; (h) documents, access to which is excluded or restricted by virtue of the access regimes on grounds of protection of personal data, and parts of documents accessible by virtue of those regimes which contain personal data the re-use of which has been defined by law as being incompatible with the law concerning the protection of individuals with regard to the processing of personal data or as undermining the protection of privacy and the integrity of the individual, in particular in accordance with Union or national law regarding the protection of personal data; (i) documents held by public service broadcasters and their subsidiaries, and by other bodies or their subsidiaries for the fulfilment of a public service broadcasting remit; (j) documents held by cultural establishments other than libraries, including university libraries, museums and archives; (k) documents held by educational establishments of secondary level and below, and, in the case of all other educational establishments, documents other than those referred to in point (c) of paragraph 1; (l) documents other than those referred to in point (c) of paragraph 1 held by research performing organisations and research funding organisations, including organisations established for the transfer of research results. This Directive builds on, and is without prejudice to, Union and national access regimes. This Directive is without prejudice to Union and national law on the protection of personal data, in particular Regulation (EU) 2016/679 and Directive 2002/58/EC and the corresponding provisions of national law. The obligations imposed in accordance with this Directive shall apply only insofar as they are compatible with the provisions of international agreements on the protection of intellectual property rights, in particular the Berne Convention, the TRIPS Agreement and the WCT. The right for the maker of a database provided for in Article 7(1) of Directive 96/9/EC shall not be exercised by public sector bodies in order to prevent the re-use of documents or to restrict re-use beyond the limits set by this Directive. This Directive governs the re-use of existing documents held by public sector bodies and public undertakings of the Member States, including documents to which Directive 2007/2/EC applies.

ARTICLE 2: DEFINITIONS For the purpose of this Directive, the following definitions apply: (1) (2)

‘public sector body’ means the State, regional or local authorities, bodies governed by public law or associations formed by one or more such authorities or one or more such bodies governed by public law; ‘bodies governed by public law’ means bodies that have all of the following characteristics: (a) they are established for the specific purpose of meeting needs in the general interest, not having an industrial or commercial character; (b) they have legal personality; and

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ARTICLE: 2 DEFINITIONS

(c) they are financed, for the most part by the State, regional or local authorities, or by other bodies governed by public law; or are subject to management supervision by those authorities or bodies; or have an administrative, managerial or supervisory board, more than half of whose members are appointed by the State, regional or local authorities, or by other bodies governed by public law; (3) ‘public undertaking’ means any undertaking active in the areas set out in point (b) of Article 1(1) over which the public sector bodies may exercise directly or indirectly a dominant influence by virtue of their ownership of it, their financial participation therein, or the rules which govern it. A dominant influence on the part of the public sector bodies shall be presumed in any of the following cases in which those bodies, directly or indirectly: (a) hold the majority of the undertaking’s subscribed capital; (b) control the majority of the votes attaching to shares issued by the undertaking; (c) can appoint more than half of the undertaking’s administrative, management or supervisory body; (4) ‘university’ means any public sector body that provides post-secondary-school higher education leading to academic degrees; (5) ‘standard licence’ means a set of predefined re-use conditions in a digital format, preferably compatible with standardised public licences available online; (6) ‘document’ means: (a) any content whatever its medium (paper or electronic form or as a sound, visual or audiovisual recording); or (b) any part of such content; (7) ‘anonymisation’ means the process of changing documents into anonymous documents which do not relate to an identified or identifiable natural person, or the process of rendering personal data anonymous in such a manner that the data subject is not or no longer identifiable; (8) ‘dynamic data’ means documents in a digital form, subject to frequent or real-time updates, in particular because of their volatility or rapid obsolescence; data generated by sensors are typically considered to be dynamic data; (9) ‘research data’ means documents in a digital form, other than scientific publications, which are collected or produced in the course of scientific research activities and are used as evidence in the research process, or are commonly accepted in the research community as necessary to validate research findings and results; (10) ‘high-value datasets’ means documents the re-use of which is associated with important benefits for society, the environment and the economy, in particular because of their suitability for the creation of value-added services, applications and new, high-quality and decent jobs, and of the number of potential beneficiaries of the value-added services and applications based on those datasets; (11) ‘re-use’ means the use by persons or legal entities of documents held by: (a) public sector bodies, for commercial or non-commercial purposes other than the initial purpose within the public task for which the documents were produced, except for the exchange of documents between public sector bodies purely in pursuit of their public tasks; or (b) public undertakings, for commercial or non-commercial purposes other than for the initial purpose of providing services in the general interest for which the documents were produced, except for the exchange of documents between public undertakings and public sector bodies purely in pursuit of the public tasks of public sector bodies; (12) ‘personal data’ means personal data as defined in point (1) of Article 4 of Regulation (EU) 2016/679;

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(13) ‘machine-readable format’ means a file format structured so that software applications can easily identify, recognise and extract specific data, including individual statements of fact, and their internal structure; (14) ‘open format’ means a file format that is platform-independent and made available to the public without any restriction that impedes the re-use of documents; (15) ‘formal open standard’ means a standard which has been laid down in written form, detailing specifications for the requirements on how to ensure software interoperability; (16) ‘reasonable return on investment’ means a percentage of the overall charge, in addition to that needed to recover the eligible costs, not exceeding 5 percentage points above the fixed interest rate of the ECB; (17) ‘third party’ means any natural or legal person other than a public sector body or a public undertaking that holds the data.

ARTICLE 3: GENERAL PRINCIPLE 1. 2.

Subject to paragraph 2 of this Article, Member States shall ensure that documents to which this Directive applies in accordance with Article 1 shall be re-usable for commercial or non-commercial purposes in accordance with Chapters III and IV. For documents in which libraries, including university libraries, museums and archives hold intellectual property rights and for documents held by public undertakings, Member States shall ensure that, where the re-use of such documents is allowed, those documents shall be re-usable for commercial or non-commercial purposes in accordance with Chapters III and IV.

CHAPTER II REQUESTS FOR RE-USE ARTICLE 4: PROCESSING OF REQUESTS FOR RE-USE 1.

2.

3.

Public sector bodies shall, through electronic means where possible and appropriate, process requests for re-use and shall make the document available for re-use to the applicant or, if a licence is needed, finalise the licence offer to the applicant within a reasonable time that is consistent with the time frames laid down for the processing of requests for access to documents. Where no time limits or other rules regulating the timely provision of documents have been established, public sector bodies shall process the request and shall deliver the documents for re-use to the applicant or, if a licence is needed, finalise the licence offer to the applicant as soon as possible, and in any event within 20 working days of receipt. That time frame may be extended by a further 20 working days in the case of extensive or complex requests. In such cases, the applicant shall be notified as soon as possible, and in any event within three weeks of the initial request, that more time is needed to process the request and the reasons why. In the event of a negative decision, the public sector bodies shall communicate the grounds for refusal to the applicant on the basis of the relevant provisions of the access regime in that Member State or of the provisions transposing this Directive, in particular points (a) to (h) of Article 1(2) or Article 3. Where a negative decision is based on point (c) of Article 1(2), the public sector body shall include a reference to the natural or legal

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ARTICLE 5: AVAILABLE FORMATS

4.

5.

6.

person who is the rightsholder, where known, or alternatively to the licensor from which the public sector body has obtained the relevant material. Libraries, including university libraries, museums and archives, shall not be required to include such a reference. Any decision on re-use shall contain a reference to the means of redress where the applicant wishes to challenge the decision. The means of redress shall include the possibility of review by an impartial review body with the appropriate expertise, such as the national competition authority, the relevant access to documents authority, the supervisory authority established in accordance with Regulation (EU) 2016/679 or a national judicial authority, whose decisions are binding upon the public sector body concerned. For the purposes of this Article, Member States shall establish practical arrangements to facilitate effective re-use of documents. Those arrangements may in particular include the means to supply adequate information on the rights provided for in this Directive and to offer relevant assistance and guidance. The following entities shall not be required to comply with this Article: (a) public undertakings; (b) educational establishments, research performing organisations and research funding organisations.

CHAPTER III CONDITIONS FOR RE-USE ARTICLE 5: AVAILABLE FORMATS 1.

2. 3. 4. 5. 6.

7. 8.

Without prejudice to Chapter V, public sector bodies and public undertakings shall make their documents available in any pre-existing format or language and, where possible and appropriate, by electronic means, in formats that are open, machine-readable, accessible, findable and re-usable, together with their metadata. Both the format and the metadata shall, where possible, comply with formal open standards. Member States shall encourage public sector bodies and public undertakings to produce and make available documents falling within the scope of this Directive in accordance with the principle of ‘open by design and by default’. Paragraph 1 shall not imply an obligation for public sector bodies to create or adapt documents or provide extracts in order to comply with that paragraph where this would involve disproportionate effort, going beyond a simple operation. Public sector bodies shall not be required to continue the production and storage of a certain type of document with a view to the re-use of such documents by a private or public sector organisation. Public sector bodies shall make dynamic data available for re-use immediately after collection, via suitable APIs and, where relevant, as a bulk download. Where making dynamic data available for re-use immediately after collection, as referred to in paragraph 5, would exceed the financial and technical capacities of the public sector body, thereby imposing a disproportionate effort, those dynamic data shall be made available for re-use within a time frame or with temporary technical restrictions that do not unduly impair the exploitation of their economic and social potential. Paragraphs 1 to 6 shall apply to existing documents held by public undertakings which are available for re-use. The high-value datasets, as listed in accordance with Article 14(1) shall be made available for re-use in machine-readable format, via suitable APIs and, where relevant, as a bulk download.

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ARTICLE 6: PRINCIPLES GOVERNING CHARGING 1.

2.

3. 4.

5.

6.

The re-use of documents shall be free of charge. However, the recovery of the marginal costs incurred for the reproduction, provision and dissemination of documents as well as for anonymisation of personal data and measures taken to protect commercially confidential information may be allowed. By way of exception, paragraph 1 shall not apply to the following: (a) public sector bodies that are required to generate revenue to cover a substantial part of their costs relating to the performance of their public tasks; (b) libraries, including university libraries, museums and archives; (c) public undertakings. Member States shall publish online a list of the public sector bodies referred to in point (a) of paragraph 2. In the cases referred to in points (a) and (c) of paragraph 2, the total charges shall be calculated in accordance with objective, transparent and verifiable criteria. Such criteria shall be laid down by Member States. The total income from supplying and allowing the re-use of documents over the appropriate accounting period shall not exceed the cost of their collection, production, reproduction, dissemination and data storage, together with a reasonable return on investment, and—where applicable—the anonymisation of personal data and measures taken to protect commercially confidential information. Charges shall be calculated in accordance with the applicable accounting principles. Where charges are made by the public sector bodies referred to in point (b) of paragraph 2, the total income from supplying and allowing the re-use of documents over the appropriate accounting period shall not exceed the cost of collection, production, reproduction, dissemination, data storage, preservation and rights clearance and, where applicable, the anonymisation of personal data and measures taken to protect commercially confidential information, together with a reasonable return on investment. Charges shall be calculated in accordance with the accounting principles applicable to the public sector bodies involved. The re-use of the following shall be free of charge for the user: (a) subject to Article 14(3), (4) and (5), the high-value datasets, as listed in accordance with paragraph 1 of that Article; (b) research data referred to in point (c) of Article 1(1).

ARTICLE 7: TRANSPARENCY 1.

2.

3.

In the case of standard charges for the re-use of documents, any applicable conditions and the actual amount of those charges, including the calculation basis for such charges, shall be pre-established and published, through electronic means where possible and appropriate. In the case of charges for the re-use other than those referred to in paragraph 1, the factors that are taken into account in the calculation of those charges shall be indicated at the outset. Upon request, the holder of the documents in question shall also indicate the way in which such charges have been calculated in relation to a specific re-use request. Public sector bodies shall ensure that applicants for re-use of documents are informed of available means of redress relating to decisions or practices affecting them.

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ARTICLE 10: RESEARCH DATA

ARTICLE 8: STANDARD LICENCES 1.

2.

The re-use of documents shall not be subject to conditions, unless such conditions are objective, proportionate, non-discriminatory and justified on grounds of a public interest objective. When re-use is subject to conditions, those conditions shall not unnecessarily restrict possibilities for re-use and shall not be used to restrict competition. In Member States where licences are used, Member States shall ensure that standard licences for the re-use of public sector documents, which can be adapted to meet particular licence applications, are available in digital format and can be processed electronically. Member States shall encourage the use of such standard licences.

ARTICLE 9: PRACTICAL ARRANGEMENTS 1.

2.

Member States shall make practical arrangements facilitating the search for documents available for re-use, such as asset lists of main documents with relevant metadata, accessible where possible and appropriate online and in machine-readable format, and portal sites that are linked to the asset lists. Where possible, Member States shall facilitate the cross-linguistic search for documents, in particular by enabling metadata aggregation at Union level. Member States shall also encourage public sector bodies to make practical arrangements facilitating the preservation of documents available for re-use. Member States shall, in cooperation with the Commission, continue efforts to simplify access to datasets, in particular by providing a single point of access and by progressively making available suitable datasets held by public sector bodies with regard to the documents to which this Directive applies, as well as to data held by Union institutions, in formats that are accessible, readily findable and re-usable by electronic means.

ARTICLE 10: RESEARCH DATA 1.

2.

Member States shall support the availability of research data by adopting national policies and relevant actions aiming at making publicly funded research data openly available (‘open access policies’), following the principle of ‘open by default’ and compatible with the FAIR principles. In that context, concerns relating to intellectual property rights, personal data protection and confidentiality, security and legitimate commercial interests, shall be taken into account in accordance with the principle of ‘as open as possible, as closed as necessary’. Those open access policies shall be addressed to research performing organisations and research funding organisations. Without prejudice to point (c) of Article 1(2), research data shall be re-usable for commercial or non-commercial purposes in accordance with Chapters III and IV, insofar as they are publicly funded and researchers, research performing organisations or research funding organisations have already made them publicly available through an institutional or subject-based repository. In that context, legitimate commercial interests, knowledge transfer activities and pre-existing intellectual property rights shall be taken into account.

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Chapter 18 ACCESS AND RE-USE OF PUBLIC SECTOR INFORMATION IN A COPYRIGHT PERSPECTIVE

I. INTRODUCTORY REMARKS 18.01 Data of publicly funded services that are used to accomplish a public function is Public Sector Information (PSI). More precisely, any data, information or content created, produced, retained, disseminated or otherwise managed both for official purposes and accidentally by Public Sector Bodies (PSBs) or public undertakings while performing a public task can be considered as PSI. 18.02 Thus, PSI covers documents and datasets, encompassing works of any nature such as geographical, meteorological, spatial, cadastral data, statistics, metadata, administrative documents, records, compilations, databases on corporate information and financial data, and any other information and contents, no matter whether its form is printed, digital or electronic, including sound recordings.1 PSBs can be any central or local government office, public administration or agency, including executive offices, legislatures, ministries, courts, assemblies, whether at the federal, regional, national or local level, including local administrations, municipalities, districts, and regions. PSBs can also be sectorial institutions, such as registrars, cadaster, and offices for statistics. In some instances, the PSB may also be an international or multinational organization. Also, cultural institutions, research or educational institutions can be considered PSBs. Thus, information on cultural goods, such as description of works of art in museums (metadata), as well as their reproductions can be considered as PSI. The broader the notion of PSB, the broader is the notion of PSI. 18.03 The more PSI is available to the public, the stronger may be the impact on the potential economic and social growth of a community. An easily accessible and re-usable PSI would enable re-users to analyse and interpret big data and better understand a country for making or withdrawing economic investment or development decisions based on the processing of PSI.2 In addition, creativity and innovation are increasingly based on collaboration, sharing and remix initiatives,3 as well as on the phenomenon of the algorithmic society, which is slowly replacing (even if not entirely) the information society; this shifting cannot be neglected by both the public and private sector. Besides economic aspects, an easy access and re-use of PSI is a crucial step all democratic societies should go through, because it favours transparency, accountability and supports facts-based public debate and discussions, which are crucial values of modern societies.4 18.04 Together with other elements, such as technical standards and solutions, policies and awareness, legal rules play a key role in PSI availability and re-use.5 Legal literature6 pushes for having freely

1

2 3

4 5 6

A first definition of PSI can be found in G. Aichholzer and H. Burkert (eds.), Public Sector Information in the Digital Age. Between Markets, Public Management and Citizens’ Rights, Edward Elgar Publishing, Cheltenham, 2004; see also the work of the Thematic Networks funded by the European Commission through the time: ePSIplatform; Legal Aspects of Public Sector Information (LAPSI) and LAPSI 2.0, whose related information is available on the official website of the European Commission www.europa.eu, as well as the research project funded by Piemonte Region: Extracting Value from Public Sector Information (EVPSI), www.evpsi.org. For additional examples on the notion of PSI see C. Sappa, Public Sector Information. How to Optimize Its Re-Use in Developing Countries?, Report commissioned by WIPO, 3ff. K. Crews and M. Dulong, Public Sector Information: Survey on Copyright and Other Legal Provisions, A Report for WIPO Internal Use, unpublished, 2016, make reference to foreign users too. L. Lessig, Remix: Making Art and Commerce Thrive in the Hybrid Economy, The Penguin Press, US, 2008. M. Ricolfi, ‘Public Sector Information as Open Data. Access, Re-Use and the Third Innovation Paradigm’, in D. Beldiman (ed.), Access to Information and Knowledge. 21st Century Challenges in Intellectual Property and Knowledge Governance, Edward Elgar Publishing, Cheltenham, 2013. These were the premises of the LAPSI 2.0 Thematic Network, while LAPSI focused on economic aspects. M. Van Eechoud, ‘Making Access to Government Data Work’, (2015) Masaryk University Journal of Law and Technology, 61ff. Among others see Aichholzer and Burkert, note 1; P. Uhlir, Policy Guidelines for the Development and Promotion of Governmental Public Domain Information, UNESCO, Paris, 2004; The Socioeconomic Effects of Public Sector Information on Digital Networks: Toward a Better Understanding of Different Access and Reuse Policies, Workshop Summary, US National

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I. INTRODUCTORY REMARKS

available PSI for any re-use possible, to create a framework fostering innovation and creativity in competitive fields, such as those of digital services, for network-driven systems where a vast amount of data is required. Studies on PSI state that making it available for re-use in a transparent, efficient and non-discriminatory fashion may be one of the ways to implement relevant public policy objectives.7 Having a look at the evolution of the EU legal framework on PSI, the European legislator seems to have endorsed the same position.8 PSI should be accessible thanks to specific sector-based legislation and policies,9 or via general 18.05 Freedom of Information Acts (FOIA).10 However, sometimes PSI may not be accessible, because of the presence of different forms of protection, such as personal data protection,11 trade secrets12 or rules on national security. Sometimes effective access to digital PSI may be limited by PSBs exercising copyright on the analogic copy of data. However, most of the time access does not entail rights of reproduction and further communication to the public, two prerogatives that fall under copyright, and are essential for PSI re-use. Even when PSI is available and accessible, no right of re-use applies automatically. Re-use is a use of 18.06 PSI by persons, for commercial or non-commercial purposes other than the initial purpose within the public task for which the documents were produced.13 Thus, re-use can be implemented by a market operator, an individual acting as a private citizen or as an entrepreneur, and by a PSB other than the PSB that created the PSI. An example could be the development of navigators and GPS upon geographical data, or any application enhancing cultural goods tourist circuits. PSI is potentially re-usable in multiple and unexpected ways. Re-uses could be under conditions or not. Should PSI and datasets be re-usable in ways that cannot be anticipated, formats need to favour such re-uses. All this means that substantial investments in technological infrastructures, as well as in software that enables their smooth use, have to be welcomed. In particular, for these purposes, ‘Open, machine-readable formats should be used, leaving it to the freedom of re-users downstream to match and interface without limitations. Proprietary formats, which are based on software or

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10 11 12

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Committee CODATA, in cooperation with OECD, 2009; N. Huijboom and T. van den Broek, Open data: An International Comparison of Strategies, in European Journal of ePractice 2011, available at http://unpan1.un.org/intradoc/ groups/public/documents/UN-DPADM/UNPAN046727.pdf; K. Janssen, Availability of Spatial and Environmental Data in the European Union: At the Crossroads Between Public and Economic Interests, Wolters Kluwer, 2012; K. Janssen and J. Crompvoets (eds), Geographic Data and the Law: Defining New Challenges, Leuven University Press, 2012. R. Pollock, The Economics of Public Sector Information, University of Cambridge, Cambridge, 2008. Open Knowledge Foundation, Beyond Access: Open Government Data and the Right to Re-use, draft, 2010; D. Robinson, H. Yu, W. P. Zeller and E. W. Felten, ‘Government Data and the Invisible Hand’, (2019) Yale J.L. & Tech, 11ff. Evidence would be the shift from Directive 2003/98/EC of the European Parliament and of the Council of November 2003 on the re-use of public sector information, imposing fees for re-use with a ceiling and not referring to licence conditions; Directive 2013/37/EU of the European Parliament and of the Council of 26 June 2013 amending Directive 2003/98/EC on the re-use of public sector information, imposing the marginal cost as a general fee, with some exceptions only); and the revised Directive 2019/EU on PSI and Open Data, imposing a free re-use and no licensing conditions, unless they are necessary. See for instance Directive 2003/4/EC on public access to environmental information, available at https://eurlex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2003:041:0026:0032:EN:PDF, which provides a broader access compared to data of other nature, because of the general interest towards it. See for instance the French Loi d’accès aux documents administratifs 78-753 of 17 July 1978, available at www.legifrance.grouv.fr, that makes PSI available via the ad hoc commission, i.e. the CADA. See on this General Data Protection Regulation (GDPR), 2016/679/EU, available at https://eur-lex.europa.eu/eli/reg/ 2016/679/oj. Directive 2016/EU on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure, available at https://eur-lex.europa.eu/legal-content/EN/TXT/?uri= CELEX%3A32016L0943. As defined by the EU PSI Directive of 2003, then by its revision via Directive 2013 and again by its revision via Directive 2019.

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other intellectual property (IP) privately owned, are not interoperable and should therefore be avoided.’14 In other words, one of the main issues related to re-use is interoperability. This latter can be technical, procedural or legal. Any initiative favouring interoperability is suitable for enhancing re-use. 18.07 Copyright is not a necessary requirement for a work of art to be considered as PSI. This means that PSI can be either covered by copyright or not, according to national legislation. A lot of PSI is protectable under copyright law, which grounds on a proprietary paradigm and therefore implies exclusive rights on protectable subject matter. Overall, there is a clear tension between a wide re-use and copyrightable PSI. In fact, the aim of copyright is control and therefore it is necessary to have a clear ex ante idea about how works are going to be exploited; this might have an impact on free circulation and re-uses, which are the result of reproduction, communication to the public, distribution and elaboration. 18.08 Many FOIA and PSI access-related acts do not refer to the re-use of the PSI obtained under access laws rules; even when referring to it, many of these acts do not allow further re-uses. The first aspect is often due to the overall structure of PSBs and decision-making bodies, which may not always have in place a very efficient information exchange and coordination process. As to the second aspect, even when PSBs mention re-use, they may not allow it, or allow it under strict conditions, and they do not necessarily refer to copyright. ‘In practice, around the world, responses to access to information requests almost never make reference to copyright issues, and simply provide the information or documents to the requestor.’15 In any case, the release to a request under PSI law will not be sufficient to exercise copyright-related rights, which are necessary for re-uses such as processing datasets for the purpose of their analysis, or simply to reproduce the documents online or offline. Access rights, re-use rights and copyright must be coordinated in a consistent way by different PSBs – or by different departments of the same PSBs – to provide an effective framework incentivizing re-use. 18.09 PSI legal treatment has been extensively discussed in past years at both national and regional levels and a general legal framework on its re-use has been put in place in the EU (II). This chapter describes the copyright conditions for PSI re-use. More precisely, it discusses how copyright principles affect PSI re-use from the perspective of the subject matter of protection (III), right ownership (IV), exceptions and limitations (V) and licences (VI).

II. THE EU LEGAL FRAMEWORK ON PSI RE-USE 18.10 The EU institutions have intensively worked with the main aim of reducing barriers to re-use of PSI. For this purpose, they introduced a harmonized legal framework for enhancing such re-use. Principles on re-use, covering fees, charging policies and technical requirements to exercise re-use were introduced expressis verbis in the early 2000s for the first time. Before that, discussion and sectorial initiatives were prepared. Since then, the digital world has structurally changed and led the

14

M. Ricolfi, ‘Public Sector Information, Intellectual Property Data and Developing Countries’, in G. Ghidini, R. Peritz and M. Ricolfi, TRIPs and Developing Countries. Towards a New IP World Order?, Edward Elgar Publishing, Cheltenham, 2014, 302ff. The quotation continues as such: Once concerns about formats and interoperability are dealt with, data should be made available without worrying too much about their presentation. After all, governments are not in the business of providing admirable portals; their mission in this connection consists in giving back to taxpayers the data which they collected, generated and stored away with taxpayers’ money.

15

J. Gray and H. Darbishire, ‘Beyond Access: Open Government Data & the Right to (Re) Use Public Information’, in Access Info Europe and Open Knowledge, 2011, available at http://www.access-info.org/wp-content/uploads/Beyond_ Access_7_Janyuary_2011_web.pdf.

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II. THE EU LEGAL FRAMEWORK ON PSI RE-USE

EU legislator to organize an EU Open Data Policy, embedding rules to encourage the re-use of data with minimal or no legal, technical and financial constraint.16 In 2003, the European Parliament passed Directive 2003/98/EC on the re-use of PSI as a general 18.11 strategy of the EU Commission ‘eEurope 2002’ action plan, which called for the development of a more harmonized approach to PSI in the EU and pushed, in particular, for having online publication of PSI. In order to establish transparency and fair trade, this Directive established rules governing the re-use of PSI that has already been made accessible when PSBs license, sell, disseminate, exchange or give information out. The Directive addressed procedures for re-use, placed limits on charging fees for re-use, prohibited discrimination, limited exclusive licensing, and required means for redress. A newly revised Directive 2013/37/EU strengthened the principles already contained in the first 18.12 2003 text and was issued in 2013. A supplementary revision was finally adopted on 6 June 201917 and it refers to open data and PSI.18 18.13 This text indicates that where a right to re-use PSI already exists, the national laws regarding such re-use of that information shall comply with the Directive’s standards in order to ensure better exploitation of PSI. All content that can be accessed under national laws on FOIA has to be re-usable beyond its initial purpose of collection for commercial and non-commercial purposes. By way of exception, content held by museums, libraries and archives is re-useable only when made available by the institution itself for re-use, and when these cultural institutions own the IPRs (if any) on the embedded intangibles of the collected item. However, where a right to re-use information already exists, the Directive sets forth the procedures and principles that need to govern its re-use. For instance, it states that conditions for re-use shall be non-discriminatory for comparable categories of re-use. No charges for re-use should be foreseen,19 even though exceptions to this principle are foreseen. Furthermore, as an additional condition, if a request for re-use is refused, the grounds for refusal and the means of redress need to be explained. Licences should not restrict possibilities for re-use or should not be used to restrict competition and Member States are

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Information on the evolution of the legal framework can be found in Sappa, note 1. This new text is part of a package of measures aimed at facilitating the creation of a common data space in the EU: the so-called Data Package, which addresses for the first time different kinds of data (public, private and scientific) in a consistent policy framework, and which includes different policy instruments, such as a Regulation on free flow of non-personal data, as well as a Communication named Towards a Common European Data Space, and again a Recommendation on access to and preservation of scientific information. All these documents are available on the official website of the European Commission, www.europa.eu. Aligned with the obligation of revision set out in Art. 13 of the PSI Directive. The PSI Directive is aimed at preventing the fragmentation of PSI re-use laws among the Member States, by harmonizing Member States’ legislation. This is functional to an increased cross-border re-use of PSI for added-value information products and services. The guiding idea is to create EU information services based upon PSI exploitation and to allow more SMEs and start-ups to enter new markets in providing databased products and services, also by accessing more real-time data, available via Application Programming Interfaces. Thus, rules were introduced on high-value datasets such as statistics and geographical data, because of their high commercial potential. Public service companies in the transport and utilities sector, when making their data available for re-use, will have to be covered by the Open Data and PSI Directive However, the decision on whether or not their data has to be made available for re-use is covered by different national or European rules. Rules are introduced for limiting competition distortions, such as monopoly markets and discrimination practices in the EU information market. This is why for instance, safeguards are suggested to reinforce transparency and limit the conclusion of agreements that could lead to exclusive re-use of PSI by private partners. The overall idea is to favour economic growth at the regional level, by enhancing legal certainty and attracting investments. Member States have to implement the revised rules within two years before they take effect. Meanwhile, the EU Commission will start working with the Member States on the identification of the high-value datasets that will be set out in an implementing act. It is worth noticing that the first version of the 2003 PSI Directive foresaw a fee equivalent to the cost of production, dissemination or distribution of the PSI, while the PSI Directive 2013 foresaw a fee equivalent to the marginal cost as a general principle. In other words, as to this specific aspect, the EU opted for an opposite solution than the cost-recovery regime, since the latter was revealed to be inefficient.

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encouraged to use standard licences in digital format. Finally, publicly funded research data were also being brought into the scope of the 2019 Directive and Member States are required to develop open data policies to apply to publicly funded research data, while harmonized rules on re-use will be applied to all publicly funded research data which is made accessible via repositories. The new text has to be transposed into national law by July 2021. 18.14 Re-use is conditioned by the existence of copyright – or other rights, including neighbouring rights. When copyright is applicable, PSI could be more or less easily accessible, depending on several conditions, such as whether the subject matter is in the public domain or not, who is the copyright owner, whether there is an exception or limitation enabling access and re-use and finally, whether the access and re-use are easily authorized.

III. PSI AS SUBJECT MATTER OF COPYRIGHT 18.15 Copyright protection applies to a wide range of literary, artistic, and scientific works. The law generally protects works, regardless of their nature, value, format or media in which they exist, are created and conveyed. Under the Berne Convention on Literary and Artistic Works,20 which is incorporated by reference in the TRIPs Agreement, legal rights are not dependent upon formalities such as registration with a government office or even placing a copyright notice on the works. EU law complies with these international legal instruments, therefore formalities for enjoying the protection or exercising rights are banned. Consequently, in the EU countries copyright protection vests automatically in works provided they meet the threshold of the access requirement. In other words, copyright applies to original works – should they be PSI or not, and – in common law countries mainly – when fixed in some medium.21 18.16 Many different works created by different offices of regional, national governments and local PSBs are then eligible as PSI and may enjoy copyright protection. Examples are: written legal rules, such as statutes, acts, codes, court rulings, administrative authorities’ opinions and decisions, agencies’ regulations, governmental or municipalities’ orders, reports and studies, space flight photographs and other data collections, presidential and ministries’ memos and speeches, security agency files, national park websites or brochures, etc. The reach of copyright protection is therefore quite broad. 18.17 However, PSI is not covered by copyright when the work of art is in the public domain. Some kind of PSI is mere data and therefore it is not copyrightable because it fails to meet the necessary requirements for accessing the protection. This is the case with raw geographical data, public transport schedules and so on.22 Then, copyright economic rights are not open-ended. Thus, 70 years after the death of the author, PSI can fall into the public domain. In addition, notwithstanding the broad reach of copyright protection, the statutes of many countries may have statutory exceptions and so exclude certain classes of works from that scope, with the purpose of freeing the works elaborated within PSBs. The Berne Convention contains an exclusion for certain governmental works that states can discretionarily introduce into their national legal orders.23 This clause

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Art. 5.2 of the Berne Convention does not request formalities since the ratification of the text at the Berlin conference in 1919. H. Desbois, A. Françon and A. Kerever, Les Conventions internationales du droit d’auteur et des droits voisins, Dalloz, Paris, 1976, 22ff. A. Lucas, A. Lucas-Schloetter and C. Bernault, Traité de la propriété littéraire et artistique, 5 ed., LexisNexis, Paris, 2017, 93ff. M. Bertani, Diritto d’autore europeo, Giappichelli, Torino, 2011, 72f. This is the so called structural public domain according to S. Dusollier, Scoping Study on Copyright and Related Rights and the Public Domain, Report commissioned by WIPO, 2010, https://www.wipo.int/publications/en/details.jsp?id= 4143&plang=EN. Art. 2.4 of the Berne Convention states: ‘it shall be a matter for legislation’ in the Member States to enact any such provision, confirming that transposing this provision is discretionary. See also Art. 2bis.1.

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III. PSI AS SUBJECT MATTER OF COPYRIGHT

leaves some questions unanswered. For instance, Article 2.4 of the Berne Convention merely refers to ‘official texts of a legislative, administrative and legal nature’, while PSI can take the form of many more categories than those included in that phrase. In addition to that, the clause does not indicate explicitly which governments are within the scope: does the exclusion apply only to works of the Member State enacting a statute or also to works from all governments, domestic and foreign?24 According to who is writing, the lack of any reference suggests that the language would apply to ‘official texts’ from the national governments, as well as from local governments within the country and from any foreign governments. However, the fact that the Berne Convention is deliberately not specific and uses language stating that it ‘shall be a matter for legislation’ suggests that national legislators or courts have to take a position on this.25 One country might apply it narrowly, while others might apply it to a broader range of governmental institutions.26 It is important to notice, however, that the lack of protection in the three abovementioned cases of 18.18 public domain refers to copyright. As a first remark, when economic rights of copyright expire open-ended moral rights can still be there, so that there may be a controlled public domain.27 As a more general remark, it is important to consider whether other legal or technical tools impede the access or re-use of PSI, even if it is in the public domain. In fact, there is anyhow a risk that another layer of protection may apply, such as a right in a database that covers this information when gathered together or other contractual rights.28 As such, what is in the public domain in a mere copyright perspective, may also be in the public domain in a broad sense only when no other forms of protection apply.29 This is connected with the fact that decision-makers may sometimes introduce guidelines or other strategic legal instruments to impede the locking-up of what is (already) in the public domain.30

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27 28 29 30

When countries exclude only their domestic governmental works from copyright protection, the same works that are public domain in the home country might be protected in other countries. The lack of a comprehensive exclusion prevents consistent application of copyright, and it inhibits legal certainty, a structural view on the issue and a global approach to working with PSI according to Crews and Dulong, note 2. Another response to the question might deal with the basic function of the Berne Convention itself, as it sets general standards for the provisions of copyright law in all member countries. However, it actually sets the copyright terms that a Member State must apply to works originating from another Member State. The Berne provision permits – or encourages? – a country to exclude copyright protection to governmental works, listed in its provisions, originating from other countries. On this see: Crews and Dulong, ibid.; Sappa, note 1. The issue could be afforded a non-discrimination perspective, on which see C. Sappa, The principle of non-discrimination, Chapter 2, in this edited work. The approach at the national level is different: for instance, in France Art. L 112-2 of the Intellectual Property Code does not exclude official acts from protection, but case law does. See P. Sirinelli and A. Latreille, Code de la propriété intellectuelle. Annoté et commenté, 20 ed., Dalloz, Paris, 2020, 57. In Italy, see Art. 5 of the Copyright Act commented by P. Galli, sub Art. 5 l.a., in L.C. Ubertazzi, Commentario breve alle leggi su proprietà intellecttuale e concorrenza, 7 ed., CEDAM, Padoue, 1667ff. In a comparative perspective: according to a traditional approach, the UK adheres to the so called ‘Crown Copyright’, i.e. it asserts protection for PSB works. In the US federal information is openly accessible and re-usable see P. Uhlir, note 6; Crews and Dulong, note 2. See infra note 29. See on this E. Derclaye, Legal Protection of Databases. A Comparative Analysis, Edward Elgar Publishing, Cheltenham, 2008. Moral rights can still persist in the work of art. An example is Art. 14 of the Directive 219/790/EU on copyright and related rights in the Digital Single Market, available at https://eur-lex.europa.eu/eli/dir/2019/790/oj, hereinafter DSM Directive. This clause states that: Member States shall provide that, when the term of protection of a work of visual art has expired, any material resulting from an act of reproduction of that work is not subject to copyright or related rights, unless the material resulting from that act of reproduction is original in the sense that it is the author’s own intellectual creation. This rule has an impact in particular in countries where neighbouring rights exist on non-creative photographs, critical editions and works published for the first time after the expiration of copyright.

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IV. COPYRIGHTABLE PSI: WHO OWNS THE RIGHTS? 18.19 PSI can be created by employees or by committed third parties. In both cases governments are funding its production. Sometimes it is created independently and only at a later stage is it acquired by PSBs; in this case, the production is not funded by taxpayers, but its acquisition is. When PSI is covered by some sort of protection, it is crucial to understand the related rules on ownership. Of course, this applies to copyright as well. As to this, the owner of moral rights is the author, while the main question is whether the owner of economic rights on the work of art is the author(s), the PSB or some other subjects. If the PSB has the copyright ownership, clearing access and re-use should be easier because the PSB itself can take decisions and initiatives as to this exploitation.31 18.20 Ownership rules are an area on which neither the Berne Convention nor TRIPs creates specific obligations. EU law sources do not deal with this aspect either. Therefore, national legislators have discretion to implement clauses on this. Also, PSBs’ employment contracts, as well as more punctual PSBs and governmental contracts, may be governed by rules on this. According to these rules, PSBs may own economic rights of copyright, sometimes ab initio, sometimes because they acquire them from third parties. 18.21 PSBs are legal persons and in particular in some legal traditions they cannot be the initial copyright owners.32 Some copyright laws or other acts33 provide for an automatic transfer of copyright from the civil servant or employed and committed authors to the state or the PSB. Some copyright laws foresee an automatic and exclusive open-ended licence to the PSB that funded the creation.34 In the absence of this provision, the transfer can be secured through express contractual clauses between the PSB and the employee, the contractor of a public procurement or a public–private partnership. The advantage of ruling on contract is that they can go beyond the standard rules established by national legislation and international treaties. In any case, in the absence of express clauses, case law may interpret such contracts in a sense that is favourable to the PSB. Then, key questions are to what extent rights can be transferred (or licensed) to PSBs: which rights? For how long?35 18.22 In case the PSB does not have ownership, re-use has to be authorized by the third party holding the rights. In this hypothesis, several challenges may be faced. The first one is related to the cost of searching for the right owner(s). Economic rights are autonomous and independent; this means that the search and negotiation may take place with different right owners. This is also connected with the known phenomenon of orphan works, which raises the transaction costs exponentially, unless ad

31 32

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However, the implementation of such access and re-use also depends on operational resources and viability of the PSBs holding the PSI. See for instance on French law, A. Lucas, A. Lucas-Schloetter and C. Bernault, note 21, 204, explaining that the civil servant is the initial right owner and the public administration receives the rights from her via a direct transfer of rights (‘cession légale’). Specific copyright arrangements may be found in PSI laws, in conjunction with labour law and administrative law, in addition to contracts such as employment, work-for-hire, grants or public procurement. On French law see A. Lucas, A. Lucas-Schloetter and C. Bernault, note 21, 202ff ; on the Italian law see Art. 11 of the Copyright Act, to be read together with Art. 29 of the same Act, which imposes a term. See P. Galli, ‘sub art. 11 l.a.’, in L.C. Ubertazzi, Commentario breve alle leggi su proprietà intellettuale e concorrenza, 7 ed., CEDAM, Padoue, 1684ff.; and ‘sub art. 29 l.a’., ibid., 1798. Copyright might be transferred to PSB only for a limited period. See for instance art. 29 of the Italian Copyright Act limiting the ownership of the state or PSB to 20 years and in some cases to two years, or Art. 101 of the Slovenian Copyright Act related to the work of art created in the course of employment, whose rights are ‘exclusively assigned to the employer for the period of ten years from the completion of the work, unless otherwise provided by the contract’ and revert to the employee on the expiration of the term. The rationale of these measures is not clear. They are very problematic for governments because they may not be able to implement PSI licensing practices in the long term if they do not hold the rights for the entire duration of copyright, and additional contracts may have to be signed in order to secure access and re-use of PSI.

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V. EXCEPTIONS AND LIMITATIONS

hoc initiatives are taken.36 The second one is related to the fact that the right owner may control economic rights only and therefore it is important to keep in mind moral rights, which remain in the hands of the original creator. The third one is related to the impact of exclusive rights: should the right owner impose a fee for the re-use that is not affordable by the potential user, the re-use will not take place. This means that third parties owning copyright on PSI are easily in a position to block decisions to make PSI available for re-use purposes, if they retain rights over data themselves.

V. EXCEPTIONS AND LIMITATIONS In cases where PSI is protected by copyright and rights are owned by third parties, the PSI Directive 18.23 principles do not apply, as stated by Recitals 54 and 55, as well as Article 1 of the text of 2019. In this case, any potential user may exploit PSI on the ground of copyright exceptions and limitations, if any. This solution may be viable also in case copyrighted PSI is owned by a PSB that has not set the conditions for licensing it to a re-user. Copyright exceptions and limitations are expressly listed in copyright acts or in IP codes, in 18.24 compliance with Article 5 of Directive 29/2001/EC on the Information Society37 and DSM Directive. They enable potential users to know ex ante what they can do in cases where copyright is protecting the desired information and in cases where they cannot afford to identify a right owner to obtain a licence.38 In this way they determine the scope of protection and indirectly the scope of the protectable subject matter. Traditionally, they are interpreted narrowly because they are considered as exceptional rules. However, more recently, some broader and more flexible interpretations were considered.39 Exceptions and limitations to copyright (and neighbouring rights) contain strict conditions, such as 18.25 specific purposes like education, research, critics, and so on. There is no exception or limitation expressly devoted to PSI and clearly any of them was designed with PSI re-use in mind.40 In addition, it is not possible to introduce such an exception in the copyright act, because of the exhaustive list of the abovementioned Article 5 of Directive 2001/29/EC. The question would be whether a PSI exception could be introduced in another text. In a systematic perspective, this option does not seem viable. The alternative solution is to interpret general copyright exceptions or limitations as applicable to PSI too. In particular, the new exceptions of data mining, as well as the one on research and teaching could be read in the light of PSI re-use. Under this approach, the structure of IP codes and copyright acts is more easily maintained as general and flexible, thus cutting off the costs of legislative initiatives not only in the short term. On the other hand, it gives more uncertainty as the interpretation is left to courts and this may lead to a less homogeneous and stable position over time. 36

37 38

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See Directive 28/2012/EU on certain permitted uses of orphan works. F. Pollaud-Dulian, ‘Utilisations autorisées des oeuvres orphelines’, (2012) RTDcom. 783ff.; S. Rodriguez Moreno, ‘La nuova disciplina delle opere orfane’ (2015) NLCC 893ff. The clause is not affected by the DSM Directive, as stated by its Art. 1.2. EU Member States can introduce and apply specific exceptions in compliance with EU and international rules. This entails the cost related to the legislative initiative, if needed and may create a too detailed act, where some long-term useful flexibility could be lacking. On the other hand, this approach has the advantage of providing clear information to potential users and ensuring legal certainty, which always fosters market initiatives. In addition, the three-step test could be applied for adding flexibility to them; Art. 5.5 of the InfoSoc Directive: It shall be a matter for legislation in the countries of the EU to permit the reproduction of such works in certain special cases, provided that such reproduction does not conflict with a normal exploitation of the work and does not unreasonably prejudice the legitimate interests of the author.

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This rule may be interpreted in a restrictive way and thus should create additional conditions for exercising exceptions and limitations, or in an extensive way and therefore should provide some flexibility to them. This may be also because in the early 2000s the Directorate General dealing with copyright and the one dealing with PSI were two different ones and therefore the initiatives were not utterly coordinated.

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VI. LICENCES 18.26 When PSBs hold PSI, they can release it for re-use purposes, no matter whether it is protected by any legal layer of protection or not.41 When it is protected, the PSB making PSI available needs to be the right owner in order to make it re-usable too.42 The question is then related to the conditions under which the PSB will authorize the re-use. Conditions and modalities pertaining to access and re-use rights can be part of PSI law, copyright law, or licences.43 Licences need to be used when a form of protection – such as copyright – covers PSI, however, they might be there also when PSI is in the public domain, either completely or merely in a copyright perspective.44 18.27 Copyright gives to authors or right owners the exclusive economic rights of reproduction, communication to the public, distribution and elaboration. Should there be any copyright in the PSI, PSBs may use copyright licences to enable re-users to exploit PSI if they are the owners of the PSI, or if they are authorized by the third-party copyright owner to make the content available under such a licence. When PSBs own economic rights, they can license them to specific users upon request. Licensing schemes specify the rights that can be exercised by PSI re-users. 18.28 Specific uses can be made thanks to customized traditional agreements, concluded with each and every licensee, or with licences offered to the wider public at large, with which any potential user can be reached via a so-called public or open copyright licence. Clearly, the use of public or open licences facilitates PSI re-use, at least in the digital realm.45 These licences can be either formal documents alone, or formal documents with a user-friendly annex favouring the understanding of users without a legal background. Also, short copyright notices can be used.

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More precisely, the authorization to access and re-use some PSI has to be given by the right owner. In case the right owner is the PSB, it can manage the related authorization; in case the right owner is not the PSB, the potential re-user shall search for the right owner to get authorization for the exploitation. One of the main questions that was traditionally asked was: who is entitled to decide how to authorize the PSI access and subsequent re-use? Should the answer be national authorities, this option would have the advantage of providing a more harmonized approach, but it would not necessarily take into account the very local needs or the peculiar situations of some PSBs. On the contrary, should the answer be: each PSB could decide on its own, this solution would lead to a very heterogeneous framework, with the risk of creating lack of legal certainty. However, the very specific needs of a specific area or a specific body would probably be more easily accommodated. This theme is afforded in a licensing perspective by M. Ricolfi, M. van Eechoud and F. Morando, ‘The Licensing of Public Sector Information’, LAPSI Position Paper n. 3, https://www.researchgate.net/publication/256047535_LAPSI_Position_Paper_No_3_The_'Licensing'_of_Public_Sector_ Information/download. The new PSI Directive of 2019 partially solves this, imposing a free re-use for all the accessible material; thus the question may remain partially unsolved as to who decides what has to be accessible (unless specific rules on access are there). Bottom-up initiatives may be used in case top-down legal measures do not strike a balance. This is the case of open licences, or initiatives such as Open Government Data, which aim at limiting obstacles to accessibility and re-usability. These obstacles can be of legal, institutional, technical, organizational or financial nature. In order to be both accessible and re-usable, PSI has to be open. In order to qualify as open, data has to fulfil several principles. According to general Open Government Data Principles, data is open when it has certain characteristics. First, it has to be Accessible: data is made available to all consumers possible, and with no limitations on their use. Second, it has to be Machine-Processable: data is published in a structured manner, to allow automated processing. Third, it has to be Non-Discriminatory: data is available for all to use, without requiring any registration. Fourth, data has to be Non-Proprietary: it is published in a format which is not controlled exclusively by a single entity. Fifth, they have to be Licence-Free. Some of these obstacles at least can be circumvented by licences. On the different scenarios related to PSI in the public domain, see para. 18.16. When PSI is licensed, should it be in the public domain the element of consideration needs to be taken into account. The issue related to the choice between customized or existing licences has been studied by both LAPSI and LAPSI 2.0 thematic networks, supra 1. See also Sappa, note 1.

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VII. CONCLUSIONS

These standardized licences do not have to be signed. PSBs develop more and more portals to 18.29 publish at least part of the PSI they produce or manage.46 These platforms may display terms of use, which may include a copyright licence referring to the conditions they may exercise in rights of reproduction, communication to the public and also creation of derivative works, including data mining of multiple datasets. In other words, the offer from the licensor (PSB) is deduced by the fact that such a licence was made available, typically on governmental or PSB websites publishing or linked to sources publishing PSI. On the other hand, the acceptance from the licensee is deduced from her exercise of rights. In the EU, in 2014 the European Commission issued a set of ‘Guidelines on recommended 18.30 standard licences, datasets and charging for the re-use of documents’ to assist Member States in their transposition of the minimum set of rules imposed for re-use, and provide examples of best practice. In particular, this non-binding document refers to non-discrimination between commercial and non-commercial uses. The approach of these Guidelines is focused on open licences. In addition, the new PSI Directive of 2019 indicates that PSI shall be released for free and with no conditions.47 Terms may now include: the attribution of the source; provisions against misrepresentations; liability regimes for the PSB; obligation for the PSB to publish and distribute the data (as opposed to only answering requests for access); procedures in case of access denial or rejection of the request to re-use or refusal of the PSB to publish the data; time limits; possible appeal of the decision, sanctions, and enforcement measures. They cannot contain, in the EU, under the new PSI Directive regime: prohibition of alterations, fees, restrictions for commercial purposes. These conditions were accepted under the former regimes of the PSI Directives 2003 and 2013 and created issues of legal interoperability.48

VII. CONCLUSIONS Re-uses can be enabled only when adequate access rules and policies are implemented, in the 18.31 presence of appropriate technical conditions and suitable procedural rules. When PSI is available, possibly on a PSB portal, it has also to be machine-readable and it should be possible to download it, read it and manipulate it. Re-use can be challenged in cases where any of these elements is lacking or an appropriate technical infrastructure is missing. Furthermore, interoperability is one of the key elements to ensure the development of digital products and services based upon PSI. This latter has to be available in a format that is compatible, interoperable with other data and datasets, so that it can be easily technically connected, linked or mashed up with them.

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Portals may host PSI that is the property of the PSB, together with embedded works or datasets, which belong to third parties, who may or shall authorize the PSB to release them under similar or different copyright licensing terms. There is a distinction between works created by a PSB and copyrights that the government may receive from others. Both categories of PSI may be hosted on portals and the use may be conditioned by a copyright licence; even if it is not strictly necessary from a copyright law perspective as PSI may already be exempted from copyright protection, it will be useful to clarify which rights are available to the public for a diverse range of PSI. Some PSI may be available under copyright law and copyright licence, but not to third-party PSI. This open data-oriented solution has been endorsed by the EU legislator only with the last revision of the PSI Directive. In fact, under the PSI Directive of 2013 PSI had to be released for a fee that could not be over the marginal price and under the PSI Directive of 2003 it had to be re-used for a fee that could not exceed the cost of production and dissemination. Remarks on different pricing are already in M. Ricolfi et al., ‘The “Principle of Governing Charging” for Re-Use of Public Sector Information’, LAPSI Position paper n. 1, https://ec.europa.eu/digital-single-market/en/news/ legal-aspects-public-sector-information-lapsi-thematic-network-outputs. The question is then: when these former regimes may still apply? See Art. 19 of the 2019 PSI Directive. On legal interoperability P. Tziavos et al., Legal Interoperability Report, LAPSI 2.0 Deliverable, https://ec.europa.eu/digitalsingle-market/en/news/legal-aspects-public-sector-information-lapsi-thematic-network-outputs.

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18.32 PSI is effectively re-usable also thanks to viable legal conditions, among which it is possible to count those related to IPRs and in particular to copyright. In fact, most of the re-use scenarios involve the exercise of rights under personal data protection rules and copyright. Generally, PSI law does not affect the existence of IPRs of PSBs, nor their possession by these bodies, and neither does it restrict the exercise of these rights beyond the limits established by the law. The EU PSI Directives established that PSI rules on re-use only apply when copyright – if any – is owned by the PSBs holding data, while the text does not apply to documents for which third parties hold IPRs, understood to encompass copyright and related rights only (including the database sui generis right). As usual with EU rules, Member States aiming to implement them may go further than the minimum conditions required. Therefore, at the national level, PSI acts can declare that PSBs should exercise their copyright in a manner that will facilitate PSI re-use. As an example, the EU PSI Directive spells out the conditions within which PSBs can exercise their IPRs in the internal market when allowing re-use of documents.49 Finally, thanks to licences that impose no conditions for re-use, legal interoperability can also be insured and re-use implemented effectively. 18.33 PSI re-use is operational when copyright and PSI laws have an effective dialogue. When a coordinated and systematic approach is missing, a potential re-user can merely access and read the PSI, as the government or third party’s rights will prevent the requester from reproducing, exploiting or further releasing the document obtained under PSI law. Back at the time when Directive 2003/98/EU on PSI re-use was introduced, the Directorate General dealing with PSI was DG-Connect, while the one dealing with Copyright was DG-Internal Market.50 Later the competence on both these topics was attributed to the merged DG-Connect. This is evidence of the fact that a major role for introducing a more consistent and effective legal framework can be played also by structural reforms. Still in the 2019 DSM Directive no express exception is devoted to PSI and initiatives on copyright do not really focus on re-use perspectives.51 However, overall the current legal framework takes better into account aspects of both sides of the subject matter studied here – PSI, i.e. control and re-use.

NOTES 1. Related instruments Directive 2003/98/EC of the European Parliament and of the Council of November 2003 on the re-use of public sector information [2003] OJ L 345/90. Directive 2013/37/EU of the European Parliament and of the Council of 26 June 2013 amending Directive 2003/98/EC on the re-use of public sector information [2013] OJ L 175/1. Directive 2003/4/EC on public access to environmental information [2003] OJ L 41/26. General Data Protection Regulation (GDPR), 2016/679/EU [2016] OJ L 119/1. Directive 2016/943/EU on the protection of the undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure [2016] OJ L 157/1. Directive 2019/790/EU on copyright and related rights in the Digital Single Market [2019] OJ L 130/92.

2. Bibliography Aichholzer, G., Burkert, H. (eds.) Public Sector Information in the Digital Age. Between Markets, Public Management and Citizens’ Rights, Edward Elgar, Cheltenham (2004). Bertani, M., Diritto d’autore europeo, Giappichelli, Torino, (2011).

49 50 51

Recital 24 of Directive 2013/37/EU and Recital 39 of the Open Data and PSI Directive approved on the 6th of June. See supra note 40. See for instance Art. 2 of the DSM Directive on the exception of preservation for cultural institutions, as well as the exception introduced by the Orphan Works Directive, which do not take into account the downside of the re-use perspective.

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NOTES Crews, K., Dulong, M. Public Sector Information: Survey on Copyright and Other Legal Provisions, A Report for WIPO Internal Use, unpublished, (2016). Derclaye, E. Legal protection of Databases. A Comparative Analysis, Edward Elgar, Cheltenham, (2008). Desbois, H., Françon, A., Kerever, A. Les Conventions internationales du droit d’auteur et des droits voisins, Dalloz, Paris, (1976). Dusollier, S., Scoping Study on Copyright and Related Rights and the Public Domain, Report commissioned by WIPO, (2010), https://www.wipo.int/publications/en/details.jsp?id=4143&plang=EN. Lessig, L. Remix: Making Art and Commerce Thrive in the Hybrid Economy, The Penguin Press, US, (2009). Gray, J., Darbishire, H. ‘Beyond Access: Open Government Data & the Right to (Re) Use Public Information’, in Access Info Europe and Open Knowledge, (2011), available at http://www.access-info.org/wp-content/uploads/ Beyond_Access_7_Janyuary_2011_web.pdf. Huijboom, N., van den Broek, T. Open data: An International Comparison of Strategies, in European Journal of ePractice (2011), available at http://unpan1.un.org/intradoc/groups/public/documents/UN-DPADM/UNPAN046727.pdf. Janssen, K., Availability of Spatial and Environmental Data in the European Union: At the Crossroads Between Public and Economic Interests, Wolters Kluwer, (2012). Janssen, K. and Crompvoets, J. (eds), Geographic Data and the Law: Defining New Challenges, Leuven University Press, (2012). Lucas, A., Lucas-Schloetter, A., Bernault, C. Traité de la propriété littéraire et artistique, LexisNexis, Paris, (5th ed, 2017). Open Knowledge Foundation, Beyond Access: Open Government Data and the Right to Re-use, draft, (2010). Pollaud-Dulian, F. ‘Utilisations autorisées des œuvres orphelines’, (2012) RTDcom. 783. Pollock, R. The Economics of Public Sector Information, University of Cambridge, Cambridge, (2008). Ricolfi, M. ‘Public Sector Information as Open Data. Access, Re-Use and the Third Innovation Paradigm’, in Beldiman, D. (ed.), Access to Information and Knowledge. 21st Century Challenges in Intellectual Property and Knowledge Governance, Edward Elgar, Cheltenham (2013). Ricolfi, M. ‘Public Sector Information, Intellectual Property Data and Developing Countries’ in Ghidini, G., Peritz, R., Ricolfi, M. TRIPs and Developing Countries. Towards a new IP World Order?, Edward Elgar, Cheltenham (2014). Ricolfi, M., van Eechoud, M., Morando, F. ‘The Licensing of Public Sector Information’, LAPSI Position Paper n. 3, https://www.researchgate.net/publication/256047535_LAPSI_Position_Paper_No_3_The_'Licensing'_of_Public_ Sector_Information/download. Ricolfi, M. et al. ‘The “Principle of Governing Charging” for Re-Use of Public Sector Information’, LAPSI Position paper n. 1, https://ec.europa.eu/digital-single-market/en/news/legal-aspects-public-sector-information-lapsithematic-network-outputs. Robinson, D., Yu, H., Zeller, W.P., Felten, E.W. ‘Government Data and the Invisible Hand’ (2009) Yale J.L. & Tech 11. Rodriguez Moreno, S. ‘La nuova disciplina delle opere orfane’ [2015] NLCC 893C. Sappa, C. Public Sector Information. How to Optimize Its Re-Use in Developing Countries?, Report commissioned by WIPO. Sirinelli, P. and Latreille, A. Code de la propriété intellectuelle. Annoté et commenté, Dalloz, Paris, (20th ed, 2020). Tziavos, P. et al. Legal Interoperability Report, LAPSI 2.0 Deliverable, https://ec.europa.eu/digital-single-market/en/ news/legal-aspects-public-sector-information-lapsi-thematic-network-outputs. Ubertazzi, L. C. Commentario breve alle leggi su proprietà intellettuale e concorrenza, CEDAM, Padoue, (7th ed, 2019). Uhlir, P. Policy Guidelines for the Development and Promotion of Governmental Public Domain Information, UNESCO, Paris, (2004) Uhlir, P. The Socioeconomic Effects of Public Sector Information on Digital Networks: Toward a Better Understanding of Different Access and Reuse Policies, Workshop Summary, US National Committee CODATA, in cooperation with OECD, (2009). Van Eechoud, M. ‘Making Access to Government Data Work’, (2015) Masaryk University Journal of Law and Technology 61.

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19 A UNITED STATES PERSPECTIVE ON DIGITAL SINGLE MARKET DIRECTIVE ARTICLE 17 Jane C. Ginsburg* I.

INTRODUCTION

1. Basic structure 2. Who is an OCSSP? 3. Exceptions and user redress mechanisms

19.01

II. HOW 17 USC SECTION 512(C) WORKS 1. Overview of Section 512(c) 2. Technological and economic assumptions underlying OCILLA 3. Judicial interpretation

19.04 19.04

III. HOW DSM DIRECTIVE ARTICLE 17 WORKS

19.19

19.06 19.10

19.20 19.25 19.30

IV. COMPARING DSM DIRECTIVE ARTICLE 17 TO SECTION 512 OF THE US COPYRIGHT ACT 19.31

I. INTRODUCTION 19.01 To a US appraiser, article 17 of the Digital Single Market Directive suggests the EU has learned from American mistakes (and from its own) in the allocation of internet intermediaries’ liability for hosting and communicating user-posted content. Before the DSM Directive, article 14 of the 2000 eCommerce Directive1 set out a notice-and-takedown system very similar to the regime provided in 17 USC section 512(c). Both regimes replaced the normal copyright default, which requires authorization to exploit works, with a limitation on the liability of service providers who complied with statutory prerequisites. Because the limitation ensured that service providers would not be liable in damages, both regimes effectively codified ‘Seek forgiveness, not permission’. 19.02 In both the US and the EU, host service providers incurred no obligation to clear rights in copyrighted content posted by users who were not the authors of that content, nor did they have any ‘general obligation … to monitor the information that they transmit or store, nor a general obligation actively to seek facts or circumstances indicating illegal activity’.2 Nor did the law in either the US or the EU require host service providers initially to block unauthorized content from being posted to their sites. Content would go up, and the burden of finding infringements and notifying the host service providers fell on authors and copyright owners. Once notified, it sufficed for the service to respond ‘expeditiously’ to the notice by blocking access to or removing the infringing content.3 This regime enabled the host provider to derive economic benefits from the availability of the infringing works on the service during the time lag between the initial posting of *

1

2 3

Many thanks for fruitful discussions to Prof. Matthias Leistner, and for research assistance to Andrew Elliott, Columbia Law School class of 2020. Portions of this Chapter are based on Copyright Law in Foreign Jurisdictions: How are other countries handling digital piracy?, Before the Subcomm. on Intellectual Prop. of the S. Judiciary Comm., 116th Cong. (2020) (testimony of Prof. Jane C. Ginsburg, March 10, 2020) (publication forthcoming). Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (Directive on electronic commerce) (OJ L 178, 17.7.2000, p. 1). Compare eCommerce Directive (Directive 2000/31/EC), art. 15 (no general duty to monitor), with 17 USC sec. 512(m)(1) (no duty to monitor, nor to ‘affirmatively seek … facts indicating infringing activity’). Compare eCommerce Directive art. 14 (notice and take down), with 17 USC sec. 512(c) (notice and take down).

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II. HOW 17 USC SECTION 512(C) WORKS

infringing content and notification and removal. And because other users could repost content when another’s posting was blocked, these time lags kept the works available for extended periods.4 This situation gave rise to what the EU Commission referred to as the ‘value gap’,5 in which the services reaped the value of works of authorship without compensating their creators or rightholders.6 Part II of this chapter will outline the text and judicial interpretation of the US Online Copyright 19.03 Infringement Liability Limitation Act’s (OCILLA) notice and takedown provisions in order to explain the regime that one might view DSM Directive article 17 as correcting. Part III will analyse the subsections of article 17 in order to explain how article 17 works, including how it changes the prior EU legal regime, and what it leaves untouched. Part IV will compare article 17 with US law in order to consider what the US might learn from the EU.

II. HOW 17 USC SECTION 512(C) WORKS 1. Overview of section 512(c) Section 512(c) sets forth cumulative prerequisites to a hosting service provider’s qualification for 19.04 exemption from direct or vicarious liability for copyright infringement.7 The host must ‘not have 4

The CJEU ultimately endorsed a takedown/staydown remedy, which would require some proactive monitoring by the host service provider; such monitoring would not violate the art. 15(1) prohibition on imposing a ‘general duty to monitor’; see, Case C 18/18, Eva Glawischnig-Piesczek v. Facebook Ireland Limited, ECLI:EU:C:2019:821 (3 October, 2019) (defamation), para. 53: Article 15(1), must be interpreted as meaning that it does not preclude a court of a Member State from: +

5

6

ordering a host provider to remove information which it stores, the content of which is identical to the content of information, which was previously declared to be unlawful, or to block access to that information, irrespective of who requested the storage of that information …

Moreover, the blocking order can extend to blocking ‘access to that information worldwide within the framework of the relevant international law’, ibid. See, e.g., European Commission, Questions & Answers: EU negotiators reach a breakthrough to modernise copyright rules, 13 February 2019: ‘How will the new rules tackle the so-called “value gap” between the creators and the online platforms?’ https://ec.europa.eu/commission/presscorner/detail/en/MEMO_19_1151 (discussing ‘value gap’ in connection with an earlier version of the text that became art. 17). See Recital 61: In recent years, the functioning of the online content market has gained in complexity. Online content-sharing services providing access to a large amount of copyright-protected content uploaded by their users have become a main source of access to content online. Online services are a means of providing wider access to cultural and creative works and offer great opportunities for cultural and creative industries to develop new business models. However, although they enable diversity and ease of access to content, they also generate challenges when copyright-protected content is uploaded without prior authorisation from rightholders. Legal uncertainty exists as to whether the providers of such services engage in copyright-relevant acts, and need to obtain authorisation from rightholders for content uploaded by their users who do not hold the relevant rights in the uploaded content, without prejudice to the application of exceptions and limitations provided for in Union law. That uncertainty affects the ability of rightholders to determine whether, and under which conditions, their works and other subject matter are used, as well as their ability to obtain appropriate remuneration for such use. It is therefore important to foster the development of the licensing market between rightholders and online content-sharing service providers. Those licensing agreements should be fair and keep a reasonable balance between both parties. Rightholders should receive appropriate remuneration for the use of their works or other subject matter. However, as contractual freedom should not be affected by those provisions, rightholders should not be obliged to give an authorisation or to conclude licensing agreements.

7

In addition, sec. 512(i)(1)(A) requires all service providers (access providers and search engines, as well as hosts), to adopt and implement a policy for terminating ‘repeat infringers’. This requirement has been construed, regarding access providers, in BMG Rights Mgmt. (US) LLC v. Cox Communs., Inc., 881 F.3d 293 (4th Cir. 2018); and regarding host providers in EMI Christian Music Group v. MP3Tunes, 844 F.3d 79 (2d Cir. 2016) (both finding the policies to be ineffective) and in Ventura Content, Ltd. v. Motherless, Inc., 885 F.3d 597 (9th Cir. 2018) (finding the policy to be sufficiently applied, albeit inadequately stated).

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Chapter 19 A UNITED STATES PERSPECTIVE ON DIGITAL SINGLE MARKET DIRECTIVE ARTICLE 17

actual knowledge that the material or an activity using the material on the system or network is infringing’; and it must not be ‘aware of facts or circumstances from which infringing activity is apparent’; moreover, if the host has the ‘right and ability to control’ the originator’s activity, the host must not ‘receive a financial benefit directly attributable to the infringing activity’.8 Once the host becomes ‘aware’ of infringing activity, it must act ‘expeditiously to remove, or disable access to, the material’.9 Section 512(c)(2) requires that a service provider, in order to benefit from the reduction in liability, designate and provide contact information concerning an agent to receive notification of claimed infringements. The service must also state and reasonably implement a policy for terminating repeat infringers.10 Copyright owners alleging that the service provider is hosting infringements must send the provider’s agent a signed, written communication identifying the work infringed, the material alleged to be infringing and its location; a statement that the complaining party has a good faith belief that the use is unauthorized; and a sworn statement that the information contained in the notification is believed to be accurate. The service provider incurs no duty to ‘monitor […] its service or affirmatively seek […] facts indicating infringing activity’.11 19.05 Upon receiving the notification, the provider must ‘expeditiously’ remove or block access to the alleged infringing material, or else face the full range of liability should the author prevail in an infringement suit. But the provider who removes or blocks the material must also so notify the subscriber; the subscriber may then send a ‘counter notification’ (whose contents the law prescribes).12 In that event, in order to maintain its immunity, the service must send the counter notification to the person who notified the service of the alleged infringement, and must inform that person that the service will replace the material in ten business days. The copyright owner must within that time ‘file […] an action seeking a court order to restrain the subscriber from engaging in infringing activity relating to the material on the service provider’s system or network’. If the copyright owner does not initiate the action, and so inform the service provider’s designated agent, then the service provider must put back the material ‘not less than 10, nor more than 14, business days following receipt of the counter notice …’.13 The purpose of the put-back requirement is to ensure that section 512 does not make it too easy for copyright owners to compel the removal of allegedly infringing material without judicial process. Section 512 initially facilitates that removal because it encourages providers who have received notice to take down the material immediately, since the text insulates service providers who comply with the statutory requirements from suit by persons (including the subscriber) disgruntled at the removal of the material from the server.14 The put-back provision thus affords an important counterweight. Moreover, if the copyright owner knowingly misrepresented that the posted content was infringing, OCILLA provides for damages, costs and attorneys’ fees to be awarded against the copyright owner.15 The ‘put back’ and misrepresentation provisions were intended to guard against copyright owner abuse of the notice and takedown system, for example, to remove clearly non-infringing (but potentially embarrassing) material.16

8 9 10 11 12 13

14 15 16

17 USC sec. 512(c)(l)(A), (B). Ibid., sec. 512(c)(l)(A)(iii). Ibid., sec. 512(j). Ibid., sec. 512(m)(1). See ibid., sec. 512(g)(3). In practice, however, the period prescribed for filing an infringement action before the host service provider reposts the content, has proved problematic for both copyright owners and end users. See ‘Section 512 of Title 17, A Report of the Register of Copyrights’ 162–63 (May 2020) (citations omitted) [hereafter Register’s Section 512 Report] (‘This particular statutory timeframe turns out to present something like a Schrödinger’s timeframe: both too long to have non-infringing speech down, and too short to enable a copyright owner to adequately research and file a complaint in federal court’). See ibid., sec. 512(g)(1). Ibid., sec. 512(f). For a detailed study of the put back regime, see, e.g., Zoe Carpou, ‘Robots, Pirates, and the Rise of the Automated Takedown Regime: Using the DMCA to Fight Piracy and Protect End-Users’, (2016) 39 Colum. J. L. & Arts 551.

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II. HOW 17 USC SECTION 512(C) WORKS

2. Technological and economic assumptions underlying OCILLA Before examining how US courts have interpreted section 512(c), it is important to consider the 19.06 factual and technological backdrop against which Congress enacted OCILLA, and compare it to today’s internet. In a study published in May 2020, the US Copyright Office observed: At the time the DMCA was crafted and then enacted, the internet had only recently evolved beyond the ‘walled gardens’ of AOL and CompuServe, Yahoo!, Amazon, and eBay were each a few years old, and ‘social media’, to the extent it existed was mainly instant messaging services, on-line dating sites, and Classmates.com. There was no Facebook or YouTube or Twitter; the first MP3 player had just been launched, and Napster, which popularized peer-to-peer (‘P2P’) file-sharing, would not exist until the following year. Today, the internet is a rich tapestry of social media sites and niche networked communities, online retail giants and e-commerce side businesses, as well as an almost endless amount of music and audiovisual entertainment from major studios and publishers, indie artists, and future stars. Every day countless new internet services join the mix. And new artists continue to find an audience without having to first convince a third party that there is a demand for what they do.17

Professor Mark Schultz, in testimony to the Senate Committee on the Judiciary, Subcommittee on 19.07 Intellectual Property, presented the information in Table 19.1.18

Table 19.1 The backdrop against which OCILLA was enacted according to Prof Mark Schultz 1998, the year the DMCA passed

Online infringement today

Fewer than 3 million pages.

Over 6.4 billion pages.

Most users on home dialup, and a single song took 10 minutes or more to download.

Users connect from multiple super-fast mobile, home wi-fi, and public networks, and a song takes seconds to download.

Online infringement likely started with a particular user, uploading a particular file.

Online infringement occurs constantly as many users and systems upload many different copies of the same work.

Online copyright infringement often spread through the relatively slow, methodical copying of a particular file from one computer to another.

Files spread quickly and simultaneously from many users and sources.

If copyright owners caught and contained an outbreak quickly enough, they could stop the spread of the file and save it from ‘escaping’ into the broader world.

Infringement is a chronic problem that can be suppressed, reduced, and managed, but never fully contained.

Service providers were likely to be more or less indifferent intermediaries that did not derive any great value from infringement.

Many popular and lucrative legal services are built to host user-posted content and benefit greatly from the presence of attractive infringing material.

Infringement notices in the hundreds, at most.

Infringement notices in the billions.

At the same Senate Hearing, Professor Jessica Litman, while expressing scepticism about copyright 19.08 owners’ lamentations, agreed that: 17 18

Register’s Section 512 Report at 28–9. The Digital Millennium Copyright Act at 22: What is it, Why was it Enacted, and Where are We Now Before the Subcomm. on Intellectual Prop. of the S. Judiciary Comm., 116th Cong. 5 (2020) (statement of Mark Schultz, Chair, IP & Tech. Law Ctr., Univ. of Akron Sch. of Law).

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Chapter 19 A UNITED STATES PERSPECTIVE ON DIGITAL SINGLE MARKET DIRECTIVE ARTICLE 17 The principal weakness of the statutory notice-and-takedown system was that it didn’t easily scale to the size of the 21st century internet. When Congress was debating the appropriate contours of section 512’s notice-and-takedown provisions, the model everyone appears to have had in mind was a human-mediated one.19

19.09 OCILLA’s shortcomings (at least in retrospect) extend beyond its failure to anticipate the tremendous volume of infringing content, much of it disseminated through a means – file-sharing – that fell completely outside the notice and takedown system.20 Congress’ allocation to copyright owners of the burdens of identifying infringing postings, rather than requiring service providers to clear rights in the posted works, has also proved problematic. This attribution of responsibility may have made sense given the premise that the service providers would be passive actors hosting third-party websites whose operators posted infringing content,21 rather than the service providers themselves operating websites that enhanced access to and monetized those postings, as is now the case. Given that premise, and the concomitant anticipated limited economic dependence of the service on the posted content,22 Congress acceded to service provider insistence that monitoring at the point of upload would be infeasible.23 In the ensuing years, by contrast, automatic ex ante filtering has become increasingly realistic and available.24

19 20

21

22

23

24

Ibid., at 8 (statement of Jessica Litman, Prof. of Law, Univ. of Mich.). Jay Dratler and Stephen McJohn, Cyberlaw: Intellectual Property in the Millennium, § 6.03 (2018); Annemarie Bridy, ‘Is Online Copyright Enforcement Scalable?’ (2011) 13 Vand. J. Ent. & Tech. L. 695, 716; Niva Elkin-Koren, ‘Making Technology Visible: Liability of Internet Service Providers for Peer-to-Peer Traffic’ (2006) 9 N.Y.U. J. Legis. & Pub. Pol’y 15, 37 (describing a file-sharing network as a ‘mere conduit’, which would fall under 512(a) and therefore not require compliance with a notice and takedown regime). S. Rep. No. 105–190, at 43 (1998) (describing sec. 512(c) safe harbour and noting ‘[e]xamples of such storage include providing server space for a user’s web site, for a chatroom, or other forum in which material may be posted at the direction of users’); H.R. Rep. No. 105–551, pt. 2, at 53 (1998) (same language). See also Senator Orrin Hatch’s opening remarks at a 1997 hearing on online service provider liability in the lead up to drafting the OCILLA, wherein he framed in part the needs of online service providers by saying that without legislative intervention, ‘it might be said that a service provider would be held liable for the unauthorized posting of copyrighted photographs on a Web site or electronic bulletin board residing on the service provider’s network, regardless of whether the service provider knew of the posting or exercised any sort of control over the content of the site’. The Copyright Infringement Liability of Online and Internet Service Providers: Hearing Before S. Comm. on the Judiciary, 105th Cong. 2 (Sept. 4, 1997). See, e.g., Religious Tech. Ctr. v. Netcom On-Line Comm. Svcs., 907 F.Supp. 1361, 1377 (N.D. Cal. 1995) (finding ‘no evidence that infringement … in any way enhances the value of Netcom’s services to subscribers or attracts new subscribers’); The Copyright Infringement Liability of Online and Internet Service Providers: Hearing Before S. Comm. on the Judiciary, 105th Cong. 87 (Sept. 4, 1997) (Testimony of George Vradenburg, general counsel of AOL, disclaiming economic dependence of ISPs on infringing content. But see Information Infrastructure Task Force, Intellectual Property and the National Information Infrastructure: The Report of the Working Group on Intellectual Property Rights 117–18 (1995): ‘The on-line services provide subscribers with the capability of uploading works because it attracts subscribers and increases usage – for which they are paid. Service providers reap rewards for infringing activity. It is difficult to argue that they should not bear the responsibilities.’ See, e.g., Cassandra Imfeld and Victoria Smith Ekstrand, ‘The Music Industry and the Legislative Development of the Digital Millennium Copyright Act’s Online Service Provider Provision’ (2005) 10 Comm. L. & Pol’y 291, 305, (quoting testimony at a hearing in February 1996 related to the NII Copyright Protection Act by CompuServe General Counsel Steven Heaton that ISPs ‘simply cannot review and monitor all the data that is transmitted over and stored in their networks or bulletin boards. … Providers of online services do not know what is being uploaded onto, transmitted through, stored upon, and downloaded from their systems’). See, e.g., Aaron Weiss, ‘Content Filters: Will ISPs Become the Enforcers of the Web?’ (2008) 12 netWorker no. 1, p. 24. Indeed, even in 2001, the Ninth Circuit, in affirming the appropriateness of the district court’s imposition of a filtering obligation while nevertheless remanding the injunction to modify its scope, observed: Conversely, Napster may be vicariously liable when it fails to affirmatively use its ability to patrol its system and preclude access to potentially infringing files listed in its search index. Napster has both the ability to use its search

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II. HOW 17 USC SECTION 512(C) WORKS

3. Judicial interpretation Section 512(c) has spawned an abundant case law construing most of its provisions.25 The decisions 19.10 of greatest relevance to DSM Directive article 17 concern judicial interpretation of the level of knowledge that will disqualify a service provider from claiming the safe harbour. The statute provides that the service provider must not ‘have actual knowledge that the material … on the

function to identify infringing musical recordings and the right to bar participation of users who engage in the transmission of infringing files. 25

A&M Records v. Napster, 239 F.3d 1004, 1027 (9th Cir. 2001). ‘Service Provider’: Hendrickson v. eBay, 165 F.Supp. 2d 1082, 1088 (C.D. Cal. 2001) (finding online auction site eBay qualifies), CoStar Grp. v. LoopNet Inc., 373 F.3d 544, 547 (4th Cir. 2004) (applying the safe harbour to a website that allowed real estate brokers to post listings); contra, Agence Fr. Presse v. Morel, 934 F.Supp. 2d 547, 566 (S.D.N.Y. 2013) (finding a photo licensing website that ‘directly licens[ed] copyrighted material online’ did not ‘“do something useful” with respect to providing or facilitating access to materials online or the activities of internet users’, and as such was not a service provider). Courts have found many functions qualify as ‘storage at the direction of a user’. UMG Recordings, Inc. v. Shelter Capital Partners LLC, 718 F.3d 1006, 1020 (9th Cir. 2013) (finding that 512(c) protection extends to ‘access-facilitating processes that automatically occur’, including transcoding content and making it available for other users to watch); Viacom Int’l, Inc. v. YouTube, Inc., 676 F.3d 19, 39 (2d Cir. 2012) (quoting earlier Shelter Capital decision, noting that protections extend beyond ‘mere electronic storage lockers’, and finding YouTube’s transcoding, playback, and ‘related videos’ functions, albeit not strictly ‘storage’, qualify for safe harbour protection). The ‘actual knowledge’, 17 U.S.C. § 512(c)(1)(A)(i), and red-flag knowledge (‘facts or circumstances from which infringing activity is apparent’), 17 U.S.C. § 512(c)(1)(A)(ii), standards are subject to highly controversial interpretations. Viacom Int’l, Inc. v. YouTube, Inc., 676 F.3d 19, 31 (2d Cir. 2012) (finding both provisions refer to knowledge of specific infringements, but actual knowledge refers to subjective awareness while red-flag knowledge refers to whether a defendant ‘was subjectively aware of facts that would have made the specific infringement “objectively” obvious’); Capitol Records, LLC v. Vimeo, LLC, 826 F.3d 78, 93–97 (2d Cir. 2016) (holding that red-flag knowledge refers to what would be obvious by ‘ordinary person’ and that a service provider employee viewing and interacting with an infringing video is not sufficient to establish red-flag knowledge absent additional evidence that the employee knew facts sufficient to conclude the video was likely infringing); EMI Christian Music Grp. v. MP3tunes, LLC, 844 F.3d 79, 92–94 (2d Cir. 2016) (reversing a directed verdict and finding red-flag knowledge could be established where a service provider was aware that all songs of certain categories – those streamed before 2007 and those recorded by the Beatles – were infringing, and thus 512(c) could impose a ‘time-limited, targeted duty’ to actively remove these songs from the platform to enjoy safe harbour protection); Mavrix Photographs, LLC v. LiveJournal, Inc., 873 F.3d 1045, 1057–58 (2d Cir. 2017) (finding a service provider employee, or agent, might have knowledge, and reiterating red-flag knowledge requires infringement ‘be immediately apparent to a non-expert’). ‘Acts Expeditiously’: Long v. Dorset, 369 F.Supp.3d 939 (N.D.Cal. 2019) (reviewing cases and determining that five business days to remove pornographic photos uploaded to Facebook subscriber’s hacked webpage met requirement of expeditious removal when Facebook communicated daily with subscriber); Rosen v. Global Net Access, LLC, CV 10-2721-DMG, 2014 WL 2803752 at *5 (C.D. Cal. 2014) (finding a service provider did not act expeditiously when it took two months to remove content); Io Grp. v. Veoh Networks, Inc., 586 F.Supp.2d 1132, 1150 (N.D.Cal. 2008) (finding that removing content ‘on the same day the notice is received (or within a few days thereafter)’ constitutes expeditious removal); Square Ring, Inc. v. Doe-1, No. 09-563, 2015 WL 307840, at *7 (D. Del. Jan. 23, 2015) (declining to find two days was expeditious as a matter of law where the content at issue was a live broadcast and the service provider had been notified before the broadcast of likely infringement). ‘Financial benefit directly attributable to the infringing activity’: Perfect 10, Inc. v. CCBill LLC, 488 F.3d 1102, 1117 (9th Cir. 2007) (common law standards and sec. 512(c)(1)(B) standards are the same); A&M Records v. Napster, Inc., 239 F.3d 1004, 1022–1023 (9th Cir. 2001); Costar Group Inc. v. Loopnet, Inc., 164 F. Supp. 2d 688, 704 (D. Md. 2001), aff’d 373 F.3d 544 (4th Cir. 2004) (‘Basically, the DMCA provides no safe harbor for vicarious infringement because it codifies both elements of vicarious liability’). ‘Right and ability to control’: Hendrickson v. eBay, Inc., 165 F.Supp.2d 1082, 1093–94 (C.D. Cal. 2001) (finding control must mean more than ‘the ability of a service provider to remove or block access to materials posted on its website or stored in its system’); Columbia Pictures Indus., Inc. v. Fung, 710 F.3d 1020, 1045–46 (9th Cir. 2013) (finding no ability to control absent ‘evidence of inducement’ or evidence ‘the defendant exerted substantial influence of its users’ activities’); Viacom Int’l, Inc. v. YouTube, Inc., 676 F.3d 19, 38 (2d Cir. 2012) (requiring ‘something more’ than the ability to restrict access and remove content but remanding the issue for further consideration). ‘Designated Agent’: BWP Media USA Inc. v. Hollywood Fan Sites LLC, 115 F.Supp.3d 397, 402–03 (S.D.N.Y. 2015) (holding designated agents must be identified on both the provider’s website and registered at the Copyright Office, and that a subsidiary service provider cannot rely on a designation by a parent company); Perfect 10, Inc. v. Amazon.com, Inc.,

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Chapter 19 A UNITED STATES PERSPECTIVE ON DIGITAL SINGLE MARKET DIRECTIVE ARTICLE 17

system or network is infringing’, or ‘in the absence of such knowledge’ must not be ‘aware of facts or circumstances from which infringing activity is apparent’.26 Courts have interpreted the latter, so-called ‘red flag’, standard to impose a ‘high bar’.27 Notably, ‘general knowledge that infringement is “ubiquitous” does not impose a duty on the service provider to monitor or search its service for infringements’.28 Even a showing that the host was not only ‘generally aware of, but welcomed, copyright-infringing material being placed on their website’, does not suffice to overcome its immunity without a further demonstration ‘as to whether [the host] actually knew, or was aware of facts or circumstances that would indicate, the existence of particular instances of infringement’.29 The requirement that specific infringements be ‘obvious’30 before the ‘red flag’ will wave, has allowed hosts to remain profitably ignorant of the content of their users’ postings. 19.11 That said, courts have acknowledged limits to the extent of service provider passive aggression that section 512(c) permits. While the host may remain blissfully unaware of particular infringements, it may not be ‘willfully blind’ to them.31 A service provider will be willfully blind if it ‘made a “deliberate effort” to avoid guilty knowledge’.32 But even if a particular posting might raise some suspicions, the host is not ‘willfully blind’ if it fails to investigate, because another provision of section 512 exonerates hosts from ‘affirmatively seeking facts indicating infringing activity’.33 According to the Second Circuit, requiring investigation short of an ‘obvious’ infringement would undermine the balance Congress struck in section 512 reflecting a policy that would foster the development of service providers: [W]e can see no reason to construe the statute as vitiating the protection of § 512(m) and requiring investigation merely because the service provider learns facts raising a suspicion of infringement (as opposed to facts making infringement obvious). Protecting service providers from the expense of monitoring was an important part of the compromise embodied in the safe harbor. Congress’s objective was to serve the public

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No. CV 05-4753, 2009 WL 1334364, at *8 (C.D. Cal. May 12, 2009) (noting certain allowable, ‘inconsequential’ departures from listed requirements in posting designated agent information). ‘Adequate Notice’: Hendrickson v. eBay, Inc., 165 F.Supp.2d 1082, 1091 (C.D. Cal. 2001) (noting notices must be in writing, while only ‘substantial compliance’ is required for the other statutory notice elements); ALS Scan, Inc. v. RemarQ Communities, Inc., 239 F.3d 619, 625 (4th Cir. 2001) (finding the notification requirements ‘are written to as to reduce the burden of holders of multiple copyrights who face extensive infringement of their works’); Perfect 10, Inc. v. CCBill LLC, 488 F.3d 1101, 1113 (9th Cir. 2007) (finding inadequate notices cannot impute knowledge to service providers of infringement); Perfect 10, Inc. v. Giganews, Inc., 993 F.Supp.2d 1192, 1200 (C.D. Cal. 2014) (finding that links to a search results page may not sufficiently identify infringing material). 17 USC sec. 512(c)(1)(A)(i)(ii). See, e.g., UMG Recordings, Inc. v. Veoh Networks Inc., 665 F. Supp. 2d 1099, 1111 (C.D. Cal. 2009), quoted in, Mavrix Photographs, LLC v. LiveJournal, Inc., 873 F.3d 1045, 1058 (9th Cir. 2017). Viacom Int’l Inc. v. YouTube, Inc., 718 F. Supp. 2d 514, 525 (S.D.N.Y. 2010), aff’d 676 F.3d 19, 31, 35 (2d Cir. 2012) (affirming that general awareness of possible infringement does not impose a duty to monitor, and that red-flag knowledge refers to awareness of specific instances of infringement). Viacom Int’l Inc., 676 F.3d at 33 (2d Cir. 2012) (emphasis added). Capitol Records, Inc. v. Vimeo, LLC, 826 F.3d 78, 93 (2d Cir. 2016); Viacom Int’l Inc., 676 F.3d at 31 (‘the red flag provision turns on whether the provider was subjectively aware of facts that would have made the specific infringement “objectively” obvious to a reasonable person’). The courts have equated the statutory term ‘apparent’ with ‘obvious’: it is not obvious that the two are synonymous. Viacom Int’l Inc., 676 F.3d at 35. On remand, however, the district court did not find facts establishing that YouTube was blind to ‘specific and identifiable instances of infringement’. Viacom International, Inc. v. YouTube, Inc., 940 F.Supp.2d 110, 116–17 (S.D.N.Y. 2013). Viacom Int’l Inc., 676 F.3d at 35 quoting In re Aimster, 334 F.3d 643, 650 (7th Cir. 2003). Instances in which courts have found ‘willful blindness’ in sec. 512(c) cases seem to be exceedingly rare, however. See EMI Christian Music Grp. v. MP3Tunes, 844 F.3d 79, 92–94 (2d Cir. 2016) (restoring a jury verdict that found red-flag knowledge and wilful blindness where an online storage locker website allowed users to copy and store files of recordings which the website operator knew had not been authorized for digital release); 4 Nimmer on Copyright § 12B.04[A][1][b][vi] (no cases other than EMI Christian Music have successfully shown willful blindness; Viacom ‘essentially empties any significance from the willful blindness inquiry’). 17 USC sec. 512(m)(1).

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II. HOW 17 USC SECTION 512(C) WORKS interest by encouraging Internet service providers to make expensive investments in the expansion of the speed and capacity of the Internet by relieving them of burdensome expenses and liabilities to copyright owners, while granting to the latter compensating protections in the service providers’ takedown obligations. If service providers were compelled constantly to take stock of all information their employees may have acquired that might suggest the presence of infringements in user postings, and to undertake monitoring investigations whenever some level of suspicion was surpassed, these obligations would largely undo the value of § 512(m).34

As a result of an absolutist interpretation of section 512(m), courts have released service providers 19.12 from any duty to investigate, and thus have effectively collapsed the actual and red-flag knowledge standards.35 By contrast, while the statutory dispensation from a duty to monitor may limit the scope of a ‘willful 19.13 blindness’ challenge to the safe harbour, a host who ‘induces’ users to post infringing content is not likely to qualify for the safe harbour.36 Indeed, where the host assists users in uploading files, it is likely to have actual or red-flag knowledge of the files’ infringing content.37 Recent decisions suggest ways in which a right owner might satisfy even an exigent interpretation of 19.14 the ‘red flag’ standard. Even though ‘[t]he infringement must be immediately apparent to a non-expert’,38 the work itself may supply evidence that its uploading was unauthorized. For example, in Mavrix Photographs, LLC v. LiveJournal, Inc., ‘[s]ome of the [plaintiff’s] photographs at issue … contained either a generic watermark or a watermark containing Mavrix’s website, “Mavrixonline.com”’. The watermark could have alerted the host that the work, authorized for one site, was not available for posting to another. Similarly, in EMI Christian Music Group v. MP3Tunes,39 the court observed that the host knew that at the time of the infringing files’ upload, the musical recordings at issue had not been licensed for dissemination in MP3 format. Accordingly, ‘the jury reasonably could have concluded that MP3tunes and Robertson were aware of “facts and circumstances that make infringement obvious”’.40 EMI Christian is particularly significant for its embrace of a takedown/stay down remedy. The court distinguished prior decisions which had ruled ex ante blocking remedies incompatible with the services’ absence of a duty to monitor their sites. Proof of the host’s red-flag knowledge justified an obligation to block content of whose infringing character the host was already aware.41 34 35

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Capitol Records, Inc. v. Vimeo, LLC, 826 F.3d at 98–99. Register’s Section 512 Report, supra note 13 at 123 (noting that at a stakeholder roundtable hosted by the Copyright Office, participants were unable to articulate a scenario that would qualify as red-flag knowledge but not also as actual knowledge under existing judicial interpretations). See, e.g., EMI Christian Music Group v. MP3Tunes, 844 F.3d 79, 93 (2d Cir. 2016); Columbia Pictures Industries, Inc. v. Fung, 710 F.3d 1020, 1039–40 (9th Cir. 2013) (declining, however, to rule that sec. 512 categorically excludes inducers from the safe harbour). Ibid. Mavrix, 873 F.3d at 1058, quoting UMG Recordings, Inc. v. Veoh Networks Inc., 665 F. Supp. 2d 1099, 1108 (C.D. Cal. 2009) and citing H.R. Rep. 105–551, pt. 2 at 58 (1998) ‘(explaining that infringements must be “apparent from even a brief and casual viewing”)’. 844 F.3d 79 (2d Cir. 2016). Ibid., at 92. Ibid., at 93: the jury was clearly instructed, and we presume it understood, that MP3tunes had no continuing, affirmative duty to monitor its servers for infringement. The jury could comply with that instruction and still find that MP3tunes was required to disable access to pre-2007 songs by ‘act[ing] expeditiously to remove, or disable access to’ the pre-2007 songs … The jury was therefore permitted to conclude that a time-limited, targeted duty—even if encompassing a large number of songs—does not give rise to an ‘amorphous’ duty to monitor in contravention of the DMCA. Viacom, 676 F.3d at 31; see also ibid,. at 34 (suggesting that a reasonable jury could find red-flag knowledge with respect to groups of clips). The same is true of the Beatles songs. The jury heard evidence that Robertson knew there had been no legal online distribution of Beatles tracks before 2010, other than one track used within a video game. Robertson further

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Chapter 19 A UNITED STATES PERSPECTIVE ON DIGITAL SINGLE MARKET DIRECTIVE ARTICLE 17

19.15 Even accounting for a possible cautious evolution towards remedies imposing some proactive obligations on host service providers, this case law illustrates the difficulties arising from a regime in which the default has shifted from requiring rights clearance before exploiting a work, to absolving the exploiting UGC platform or website from infringement liability unless the rightholder can demonstrate that the exploiter should objectively have known precisely which works it was hosting, and where they could be found on the service. The resulting allocation of benefits and burdens has tipped so far from the equilibrium envisioned in 1998, that the telecoms and infant entrepreneurs whose internet ventures Congress sought to encourage have become market forces often more dominant than the copyright industries Congress once feared would stifle the new entrants.42 As the Register of Copyrights has recently concluded: ‘Based upon its own analysis of the present effectiveness of section 512, the [Copyright] Office has concluded that Congress’ original intended balance has been tilted askew.’43 19.16 If Congress may have over-achieved its objective of fostering the development of host service providers, its provisions for ensuring that users could continue to post non-infringing content may have fallen short of the mark. It is unclear whether section 512’s counter-notice and put-back mechanism has succeeded in maintaining online availability of non-infringing postings. The immense volume of allegedly infringing postings has led to a concomitant volume of ‘robo-notices’44 (typically from copyright owners who can afford the costs of identifying infringements and sending mass takedown notices).45 These notices may sweep in postings that would be non-infringing fair uses. The apparently low proportion of ensuing counter-notifications46 could mean that many fair uses are being suppressed, or it could simply mean that the vast majority of postings are in fact infringing. Even if the number of takedowns flowing from false positives is not as great as some

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admitted that he authored a 2009 e-mail that showed he was aware of the plaintiffs’ position that ‘[the] Beatles have never authorized their songs to be available digitally’. See, e.g., Forbes’ ‘Global 2000’ list, documenting the largest companies in the world in 2019, for instance, where the top 100 companies include (among others) the following American corporations: Alphabet [Google] (#17), Amazon (#28), Facebook (#63). The largest ‘copyright industry’, Disney, ranks #70. The World’s Largest Public Companies, 2019 Ranking, FORBES, accessible at: https://www.forbes.com/global2000/list/#country:United%20States (last visited April 13, 2020). Register’s Section 512 Report, supra note 13, at 1. See also ibid., at 197: ‘The Copyright Office concludes that the balance Congress intended when it established the section 512 safe harbor system is askew.’ Joe Karaganis and Jennifer Urban, ‘The Rise of the Robo Notice’ (2015) 58 Communications of the ACM 28. Section 512 of Title 17, Hearing Before the Subcomm. on Courts, Intellectual Prop. and the Internet of the House Judiciary Comm., 113th Congress at 16 (2014) (testimony of Prof. Annemarie Bridy noting copyright owners who ‘can’t afford automated systems’ may have to rely on websites with pre-packaged forms to readily send takedown requests); Motion Picture Association of America, Comment on Section 512 Study Before the U.S. Copyright Office, 80 Fed. Reg. 81,862, at 16 (April 1, 2016), https://www.regulations.gov/document?D=COLC-2015-0013-90285 (noting that ‘smaller entities may not be able to afford to use technology to enable discovery of infringing content’). Though data is limited, one study analysing the notice and takedown regime interviewed 29 intermediary online service providers of various sizes as well as six ‘major notice senders’ (rightholders and enforcement agents) and found that only one respondent ‘reported receiving more than a handful [of counter-notices] a year’ and that many reported no counter-notices, despite processing thousands of takedown requests. Jennifer M. Urban, Joe Karaganis and Brianna L. Schofield, ‘Notice and Takedown in Everyday Practice’, U.C. Berkeley Pub. L. & Legal Theory Res. Paper Series, 44 (2017). Another study analysed more than 540,000 notices to Google and Twitter between 2001 and 2012. It estimated that of notices analysed in 2011, only 0.131 percent were counter-notices, and in 2012 the number was 0.02 percent. It found no counter-notices for the years 2008 through 2010. Daniel Seng, ‘The State of the Discordant Union: An Empirical Analysis of the State of DMCA Takedown Notices’ (2014) 18 Va. J.L. & Tech. 369, 426, 462. But see Register’s Section 512 Report, supra note 13 at 147 n. 788 (raising questions about the Urban et al. study’s methodology).

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II. HOW 17 USC SECTION 512(C) WORKS

proclaim,47 it may well be possible that fear or ignorance will cause some fair users to decline to contest a takedown notice.48 A further impediment to preventing the removal of lawful postings may result from judicial 19.17 interpretation of the statutory disincentives to abuse the notice and takedown system. Section 512(f) provides for damages and attorneys’ fees against the rightholder’s ‘knowing material misrepresentation’ that the posted content was infringing. Courts’ application of that standard has proven very forgiving.49 The Ninth Circuit has held that ‘a copyright holder need only form a subjective good faith belief that a use is not authorized’.50 A kind of symmetry has resulted: just as an infringement must be objectively ‘obvious’ to meet the red flag knowledge standard and thus deprive the host of its statutory immunity, so, to engage the rightholder’s liability for knowing misrepresentation, must the lawful nature of the posting be so patent that the rightholder could not subjectively believe that the content infringed. That, too, sets a ‘high bar’ likely to screen out many misrepresentation claims. On the other hand, the Ninth Circuit also ruled that a rightholder cannot form a good faith belief in 19.18 the unlawfulness of the posted content without first endeavouring to ascertain whether the posting could be fair use or otherwise authorized by law. Thus, the indiscriminate sending of takedown notices would contravene the court’s ‘unequivocal holding that [the rightholder] must consider fair use before sending a takedown notification’; failure to ‘consider’ lawful uses would render the rightholder ‘liable for damages under § 512(f)’.51 In light of the immense quantity of uploaded content for which a rightholder’s ‘bot’ might find a match, one may wonder how a rightholder could in practice undertake the consideration requisite to a ‘procedurally “informed” subjective good faith belief on fair use before sending a takedown notice’.52 It is unclear whether every posting will require human review,53 or if algorithms could meet the task of identifying probable fair uses,54 thus circumscribing the universe of postings for which the rightholder’s human agents must form a subjective belief in the posting’s unlawfulness.

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See, e.g., Urban, Karaganis and Schofield, ibid., at 88, arguing that 31 percent of takedown requests in a survey sample were ‘potentially problematic’. However, the authors said only 4.2 percent were ‘fundamentally flawed’ (for instance, by identifying an incorrect work), while 19.5 percent were due to concerns about meeting the notification requirements (including everything from missing signatures to links the authors thought might be insufficiently specific to allow the service provider to identify the particular infringing work at issue), and another 6.6 percent presented what the authors felt were fair use questions. See ibid., at 44–5. On the other hand, the most egregious reported case did result in the award of damages and attorneys’ fees, see Online Policy Grp. v. Diebold, Inc., 337 F.Supp.2d 1195 (N.D.Cal.2004), in which the court found that the copyright owner met the statutory standard because the disclosure of internal company emails for whistle-blowing purposes was clearly fair use, and that the copyright holder was using the notice and takedown regime ‘as a sword to suppress publication of embarrassing content rather than as a shield to protect its intellectual property’. See, e.g., Lenz v. Universal Music Corp., 815 F.3d 1145, 1153 (9th Cir. 2016); Rossi v. Motion Picture Ass’n of Am. Inc., 391 F.3d 1000 (9th Cir.2004); Stern v. Lavender, 319 F.Supp.3d 650, 683 (S.D.N.Y. 2018); Johnson v. New Destiny Christian Ctr. Church, Inc., 6:17-cv-710-Orl-37DCI, 2019 WL 1014245 at *4–5 (M.D. Fl. March 4, 2019), aff’d., 826 Fed. Appx. 766 (11th Cir. 2020). Lenz, 815 F.3d at 1154. See Matthias Leistner, ‘European Copyright Licensing and Infringement Liability Under Art. 17 DSM Directive Compared to Secondary Liability of Content Platforms in the U.S. – Can We Make the New European System a Global Opportunity Instead of a Local Challenge?’, Zeitschrift für Geistiges Eigentum/Intellectual Property Journal (forthcoming 2020) (including suggestions for overcoming the potentially prohibitive transactions costs). See, e.g., Matthew Sag, ‘Internet Safe Harbors and the Transformation of Copyright Law’ (2017) 93 Notre Dame L. Rev. 499, 532–33 (finding an ‘obvious implication’ in Lenz to require human review, but suggesting that algorithm-based reviews might still be permissible); Register’s Section 512 Report, supra note 13, at 150–52 (discussing uncertainty regarding need for human review or permissibility of automated search programs to form a good faith belief that posted content is not fair use). See, e.g., Maayan Perel and Niva Elkin-Koren, ‘Accountability in Algorithmic Copyright Enforcement’ (2016) 19 Stan. Tech. L. Rev. 473, 487–88.

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Chapter 19 A UNITED STATES PERSPECTIVE ON DIGITAL SINGLE MARKET DIRECTIVE ARTICLE 17

III. HOW DSM DIRECTIVE ARTICLE 17 WORKS 19.19 Article 17 adopts a completely different approach from the US in section 512. We have seen how the text and judicial interpretation of section 512 have enabled hosts to develop into massively profitable businesses based in substantial part on their provision of access to copyrighted works. Solicitude for new digital communications intermediaries through statutory immunity, together with technologically-overtaken expectations for effective semi-private copyright enforcement through notices and takedowns, combined to produce a system in which hosts’ statutorilyauthorized passivity allowed them to reap the benefits of communicating copyrighted works, while copyright owners have struggled to prevent uncontrolled dissemination of their works. Private ordering, through preclearance systems such as Content-ID, has developed alongside the statutory regime, to enable clearance and monetization,55 but content owners complain that the statutory backdrop diminishes their bargaining power.56 Worse, for individual authors and small copyright owners, Content-ID does not accommodate small repertories,57 thus leaving them only options to block, but not to derive revenue from hosts’ dissemination of their works.58 In light of the shortcomings of the US law, does the DSM Directive strike a better balance?

1. Basic structure 19.20 The Directive, article 17(4), requires Online Content Sharing Service Providers [hereafter OCSSP] (a defined term, discussed below) to obtain authorization for users’ posting of content. The authorization granted to the service provider will also cover its users, ‘when they are not acting on a commercial basis or where their activity does not generate significant revenues’.59 As a result, the host’s license would not automatically shield users who earn revenue from posted content through sponsorship or advertisement, but hosts and copyright owners might negotiate to share that revenue, thus extending the license’s coverage. By contrast, the section 512 safe harbour applies only to the host service provider; even users whose postings are unaccompanied by advertisements remain vulnerable to copyright infringement suits and liable for damages in the event infringement is found (although non-commercial users seem unlikely targets of suits seeking monetary relief). 55

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See, e.g., Bruce Boyden, The Failure of the DMCA Notice and Takedown System, 3–4 (CPIP 2013) (observing that copyright owners and online services have developed work-arounds to the notice-and-takedown system via ‘technological tools that allow copyright owners to identify their content and specify what should happen when it appears on the service provider’s system’, calling such ‘private ordering’ a step in the right direction but a sign of the need ‘for a retooling of the notice and takedown regime’); Register’s Section 512 Report, supra note 13 at 42–4 (describing Content-ID, and summarizing critiques); ibid., at 45–6 (describing other filtering technologies). See, e.g., Warner Music Group, Comment on Section 512 Study Before the U.S. Copyright Office, 80 Fed. Reg. 81,862 (April 7, 2016), https://www.regulations.gov/document?D=COLC-2015-0013-86022; ‘Fixing the Value Gap: Now on the Legislative Agenda’ in Global Music Report: State of the Industry Overview, International Federation of the Phonographic Industry 22 (2016); T. Randolph Beard et al., Safe Harbors and the Evolution of Music Retailing, Phoenix Center Policy Bulletin No. 41 (March 2017); Peter Kafka, Here’s Why the Music Labels are Furious at YouTube. Again, Recode (April 11, 2016). Using Content ID, YouTube Help, https://support.google.com/youtube/answer/3244015?hl=en (last visited April 8, 2020) (‘To be approved, you must own exclusive rights to a substantial body of original material that is frequently uploaded by the YouTube user community’); Register’s Section 512 Report, supra note 13 at 43: Participation in the Content ID program is limited to rightsholders who ‘own exclusive rights to a substantial body of original material that is frequently uploaded by the YouTube creator community’. Some commenters complain that this policy unfairly excludes smaller copyright owners; in their view, ‘every artist should be entitled to this service, to register their music once and for all.

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Copyright Management Tools, YouTube Help, https://support.google.com/youtube/answer/9245819 (last visited April 8, 2020) (describing YouTube’s general takedown notices, its Copyright Match Tool, and its Content Verification Program as alternatives to Content ID, though these alternatives only allow users to request the content be taken down or else request to contact the uploader – there is no provision similar to Content ID’s monetization option). See DSM Directive, art. 17(2).

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III. HOW DSM DIRECTIVE ARTICLE 17 WORKS

If the copyright owner is not willing to license, or not willing to license until some period after the 19.21 initial disclosure of the content on the copyright owner’s own site, then the OCSSP must make best efforts to block unlicensed content from appearing on the service, whether forever, or during the rightowner’s period of exclusivity. Rightholders and OCSSPs will need to cooperate to identify the content to be blocked. If rightholders fail to provide OCSSPs with the information necessary to implement proactive filtering, the service provider will not be liable for the unidentified content’s appearance on its site.60 Finally, for content neither licensed nor pre-blocked, the OCSSP is required, ‘upon receiving 19.22 sufficiently substantiated notice from the rightholders, to disable access to, or to remove from, their websites the notified works or other subject matter, and ma[k]e best efforts to prevent their future uploads …’.61 In other words, article 17(4) establishes for most OCSSPs, a tripartite regime: license, block, or takedown/stay down. The Directive’s absence of specification as to how the OCSSPs are to obtain permission may 19.23 prompt two related concerns. First, rights clearance for all works posted to OCSSPs (essentially, large platforms) may entail excessive transactions costs. Second, to reduce those costs, OCSSPs might negotiate only with large copyright owners and collectives, leaving individual authors and small rightholders to bear the burden of notifying the OCSSPs of infringing content. But the Directive provides mechanisms to address these potential difficulties. Article 17(10) mandates ‘stakeholder dialogues’ ‘to discuss best practices for cooperation between online content-sharing service providers and rightholders’ and to ‘issue guidance on the application of this Article, in particular regarding the cooperation referred to in paragraph 4’. Similarly, article 17(8) mandates both cooperation and transparency by OCSSPs toward all rightholders: Member States shall provide that online content-sharing service providers provide rightholders, at their request, with adequate information on the functioning of their practices with regard to the cooperation referred to in paragraph 4 and, where licensing agreements are concluded between service providers and rightholders, information on the use of content covered by the agreements.

As a result, while there will be many details to resolve, it appears that the Directive strives to ensure that individual authors and small rightholders will be able to negotiate permissions62 and to obtain ex ante blocking of works they are unwilling to license for ‘sharing’ on online platforms. Where article 17 applies, it replaces the 512-like notice and takedown system established in article 19.24 14(1) of the 2000 eCommerce Directive.63 That regime remains in force for service providers who are not OCSSPs.

60

See Recital 66: Where rightholders do not provide online content-sharing service providers with the relevant and necessary information on their specific works or other subject matter, or where no notification concerning the disabling of access to, or the removal of, specific unauthorised works or other subject matter has been provided by rightholders, and, as a result, those service providers cannot make their best efforts to avoid the availability of unauthorised content on their services, in accordance with high industry standards of professional diligence, such service providers should not be liable for unauthorised acts of communication to the public or of making available to the public of such unidentified works or other subject matter.

61 62

63

Art. 17(4). Collective Management Organizations, more prevalent in the EU than in the US, may grant blanket licenses covering a broader range of works than US CMOs represent, and thus significantly ameliorate the problem of high transactions costs in the EU. See art. 17(3).

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Chapter 19 A UNITED STATES PERSPECTIVE ON DIGITAL SINGLE MARKET DIRECTIVE ARTICLE 17

2. Who is an OCSSP? 19.25 Unlike the online actors to whom 17 USC section 512(c) (host service providers) and (d) (search engines) broadly apply, DSM Directive article 17 covers only a narrow class of service providers, focused essentially on large platforms, such as YouTube and Facebook. DSM Directive article 2(6) defines an OCSSP as: [a] provider of an information society service of which the main or one of the main purposes is to store and give the public access to a large amount of copyright-protected works or other protected subject matter uploaded by its users, which it organises and promotes for profit-making purposes.

19.26 Article 2(6) explicitly excludes: Providers of services, such as not-for-profit online encyclopedias, not-for-profit educational and scientific repositories, open source software-developing and -sharing platforms, electronic communication service providers as defined in Directive (EU) 2018/1972, online marketplaces, business-to-business cloud services and cloud services that allow users to upload content for their own use.

19.27 Thus, it is clear that services such as Wikipedia, Dropbox and eBay fall outside the scope of article 17, as would all not-for-profit educational sites. As Recital 62 specifies: ‘Such services should not include services that have a main purpose other than that of enabling users to upload and share a large amount of copyright-protected content with the purpose of obtaining profit from that activity.’ Equally importantly, given the definition and the Recital, search engines would not be considered OCSSPs. Search engines may act for profit, but their main purpose is to locate content (whether or not user-posted), not to enable users to post that content, nor primarily to facilitate their sharing of it.64 19.28 In addition, article 17’s duties do not bear equally even on all those who do qualify as OCSSPs. Article 17(6) limits the liability of small startup platforms ‘which have been available to the public in the Union for less than three years and which have an annual turnover below EUR 10 million’ to ‘best efforts to obtain authorization’, and failing that, a notice and takedown regime. Startups whose ‘average number of monthly unique visitors … exceeds 5 million’ also incur a stay-down obligation. 19.29 Article 17(5) introduces further flexibility by instructing Member States to ensure that OCSSPs’ duties are proportional to their size and resources. ‘Best efforts’ clauses temper OCSSPs’ obligations to block unauthorized content and, upon proper notice, to ensure that the content cannot be re-uploaded. The Directive recognizes that the results of the ‘best efforts’ of smaller platforms might be less effective than the more costly ‘best efforts’ of the principal commercial actors.

3. Exceptions and user redress mechanisms 19.30 Article 17(7) requires Member States to ensure that users may continue to upload content covered by copyright exceptions and limitations, particularly for quotation, criticism, review, caricature, parody or pastiche. To that end, Recital 70 explains: ‘It is important to ensure that online 64

We can further infer the exclusion of search engines from the rejection of the following amendment added by the EU Parliament as art. 13b: Member States shall ensure that information society service providers that automatically reproduce or refer to significant amounts of copyright-protected visual works and make them available to the public for the purpose of indexing and referencing conclude fair and balanced licensing agreements with any requesting rightholders in order to ensure their fair remuneration. Such remuneration may be managed by the collective management organisation of the rightholders concerned. The amendment clearly targeted Google Image Search, but ultimately did not carry the day.

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IV. COMPARING DSM DIRECTIVE ARTICLE 17 TO SECTION 512 OF THE US COPYRIGHT ACT

content-sharing service providers operate an effective complaint and redress mechanism to support use for such specific purposes.’ Article 17(9) details the mechanism for expeditious redress. First, OCSSPs’ terms and conditions must inform users that they can avail themselves of copyright exceptions, and the OCSSPs must ‘put in place’ (and implicitly, inform users of) an ‘effective and expeditious complaint and review mechanism’ so that users may challenge the blocking or disabling of their postings. Second, rightholders must ‘duly justify’ their takedown notices. User complaints then must be ‘processed without undue delay’ by the OCSSP, who must engage in human review of the challenged postings. Article 17(9) also requires Member States to provide both access to courts and to alternate dispute resolution measures so that users may assert their entitlement to copyright exceptions (presumably in the event that the OCSSP maintains the takedown over the user’s objection). Finally, article 17(10) calls for ‘stakeholder dialogues’ to discuss the ‘best practices’ required by article 17(4) as well as to implement exceptions and limitations.

IV. COMPARING DSM DIRECTIVE ARTICLE 17 TO SECTION 512 OF THE US COPYRIGHT ACT With respect to the service providers it regulates (a much smaller, but economically very significant, 19.31 subset of the service providers covered by sec. 512), the DSM Directive establishes a regime that is effectively the opposite of section 512’s liability limitation approach. Where section 512 absolves service providers who meet the statutory ‘safe harbour’ criteria from obtaining authorization, so long as they ‘respond expeditiously’ to takedown notices, the DSM Directive requires that OCSSPs acquire rights from copyright owners up front. Where section 512 imposes no ex ante proactive duties to block infringing content, the DSM Directive obliges OCSSPs and rightholders to cooperate in preventing unauthorized content from being posted in the first place. And where US courts do not uniformly enter ‘stay down’ remedies,65 the DSM Directive makes them mandatory for OCSSPs other than economically modest startups. Both section 512 and article 17 provide mechanisms to challenge the removal of postings that users 19.32 believe to be non-infringing, but section 512(g) places a higher burden of justification on rightholders: if a user sends a counter notification, the rightholder, in order to maintain the content’s removal, must initiate a copyright infringement suit against the user, otherwise the service will repost the content. Section 512(f), moreover, provides for courts to award users damages and attorneys’ fees against a rightholder ‘who knowingly materially misrepresents that material or activity is infringing’. Section 512 thus offers two kinds of user redress: automatic reposting if the rightholder fails to initiate an infringement action following receipt of a counter notification, and the prospect of substantial monetary liability if the rightholder abuses the notice and takedown process.66 In this regard, the role of human review plays out differently in the US and in the EU. Ninth 19.33 Circuit precedent suggests that to avoid claims of misrepresentation, the rightholder may need to engage in human review of the alleged infringing postings before sending a takedown notice, while article 17(9) directs the service provider to engage in human review in response to the user’s complaint that the OCSSP erroneously blocked her posting. But, under the DSM Directive, if the 65

66

The Copyright Office has expressed some scepticism about a notice and staydown regime, see Register’s Section 512 Report, supra note 13 at 191 (‘There are reasons to be cautious regarding the adoption of a general staydown requirement for OSPs. … [A]doption of a staydown requirement, with or without an affirmative filtering requirement for all (or even most) OSPs, would represent a fundamental shift of intermediary liability policy in the United States’). On the other hand, courts have applied a rather forgiving standard of bad behavior in determining whether a takedown notice constituted a ‘knowing […] material […] misrepresentation’. See Rossi v. Motion Picture Ass’n of Am. Inc., 391 F.3d 1000 (9th Cir.2004), discussed supra note 50.

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Chapter 19 A UNITED STATES PERSPECTIVE ON DIGITAL SINGLE MARKET DIRECTIVE ARTICLE 17

OCSSP rejects the user’s challenge, it appears that the user who seeks the reposting of the content will incur the burden of seeking judicial, or alternate dispute resolution, relief. On the other hand, the participation of user representatives in the ‘stakeholder dialogs’ to articulate criteria for ex ante blocking, and the direction to ensure the availability of mandatory exceptions, may effectively reinforce user access to non-infringing content by avoiding its blockage in the first place. 19.34 Section 512’s effective codification of ‘seek forgiveness, not permission’ has fostered a vast amount of communication among internet users, but also shifted a vast amount of wealth to large commercial actors, without commensurate benefits to the creators of works. The US Congress is now reviewing many aspects of the 1976 Copyright Act, including the section 512 safe harbour regime. If Congress wishes to revise section 512 by returning the default from liability limitation to the normal copyright approach of obtaining authorization, the DSM Directive offers Congress a model, or at least a detailed example of reform. The development of identification tools such as Content-ID has belied at least some of the technological assumptions that underlay the 1998 legislation. Moreover, section 512’s notice and takedown regime is not cost-free to either the copyright owner or the service provider, especially given the immense volume of notices.67 Content-ID and equivalent white list/black list systems already implement by private agreement much of the DSM Directive’s regime of cooperation in content licensing and blocking. But where these private enforcement measures may not be readily or equally available to all copyright owners, particularly not to individual authors and small rightholders, the EU approach should enable more authors and rightholders to obtain the benefits of licensing and ex ante blocking.68 Finally, it will be important to assess which mechanisms, the measures established in section 512(f)(g), or those in article 17(7), (9) and (10), prove in practice most likely to preserve copyright exceptions in the content-sharing environment.

NOTES 1. Related instruments Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (Directive on electronic commerce) [2000] OJ L 178/1. U.S. Copyright Act of 1976, as amended through March 27, 2020, 17 U.S.C. secs. 101 et seq., https://www. copyright.gov/title17/title17.pdf.

2. Case law Case C 18/18, Eva Glawischnig-Piesczek v. Facebook Ireland Limited, ECLI:EU:C:2019:821. Agence Fr. Presse v. Morel, 934 F.Supp. 2d 547, 566 (S.D.N.Y. 2013). ALS Scan, Inc. v. RemarQ Communities, Inc., 239 F.3d 619, 625 (4th Cir. 2001). A&M Records v. Napster, 239 F.3d 1004, 1027 (9th Cir. 2001). BMG Rights Mgmt. (US) LLC v. Cox Communs., Inc., 881 F.3d 293 (4th Cir. 2018). BWP Media USA Inc. v. Hollywood Fan Sites LLC, 115 F.Supp.3d 397, 402–03 (S.D.N.Y. 2015). Capitol Records, LLC v. Vimeo, LLC, 826 F.3d 78, 93–97 (2d Cir. 2016). Columbia Pictures Indus., Inc. v. Fung, 710 F.3d 1020, 1045–46 (9th Cir. 2013).

67

68

Cary Sherman, Valuing Music in a Digital World, Forbes (Sept. 23, 2015) (RIAA CEO saying that notice and takedown regime is ‘a never-ending game that is both costly and increasingly pointless’.); How Google Fights Piracy, p. 30 (November 2018), https://www.blog.google/documents/25/GO806_Google_FightsPiracy_eReader_final.pdf (noting in 2017 YouTube received 2.5 million takedown requests for more than 7 million videos, indicating that it ‘carefully reviewed’ the requests and asked for more information or rejected requests related to 300,000 videos). For detailed analysis of how this might be achieved within the DSM Directive art. 17 framework, see Leistner, supra note 52.

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NOTES Costar Group Inc. v. Loopnet, Inc., 164 F. Supp. 2d 688, 704 (D. Md. 2001), aff’d 373 F.3d 544 (4th Cir. 2004). CUMG Recordings, Inc. v. Shelter Capital Partners LLC, 718 F.3d 1006, 1020 (9th Cir. 2013). EMI Christian Music Group v. MP3Tunes, 844 F.3d 79 (2d Cir. 2016). Hendrickson v. eBay, 165 F.Supp. 2d 1082, 1088 (C.D. Cal. 2001). In re Aimster, 334 F.3d 643, 650 (7th Cir. 2003). Io Grp. v. Veoh Networks, Inc., 586 F.Supp.2d 1132, 1150 (N.D.Cal. 2008). Johnson v. New Destiny Christian Ctr. Church, Inc., 6:17-cv-710-Orl-37DCI, 2019 WL 1014245 at *4–5 (M.D. Fl. March 4, 2019), appeal pending. Lenz v. Universal Music Corp., 815 F.3d 1145, 1153 (9th Cir. 2016). Long v. Dorset, 369 F.Supp.3d 939 (N.D.Cal. 2019). Mavrix Photographs, LLC v. LiveJournal, Inc., 873 F.3d 1045, 1057–58 (2d Cir. 2017). Online Policy Grp. v. Diebold, Inc., 337 F.Supp.2d 1195 (N.D.Cal.2004). Perfect 10, Inc. v. CCBill LLC, 488 F.3d 1102, 1117 (9th Cir. 2007). Perfect 10, Inc. v. Amazon.com, Inc., No. CV 05-4753, 2009 WL 1334364, at *8 (C.D. Cal. May 12, 2009). Perfect 10, Inc. v. Giganews, Inc., 993 F.Supp.2d 1192, 1200 (C.D. Cal. 2014). Religious Tech. Ctr. V. Netcom On-Line Comm. Svcs., 907 F.Supp. 1361, 1377 (N.D. Cal. 1995). Rosen v. Global Net Access, LLC, CV 10-2721-DMG, 2014 WL 2803752 at *5 (C.D. Cal. 2014). Rossi v. Motion Picture Ass’n of Am. Inc., 391 F.3d 1000 (9th Cir.2004). Square Ring, Inc. v. Doe-1, No. 09-563, 2015 WL 307840, at *7 (D. Del. Jan. 23, 2015). Stern v. Lavender, 319 F.Supp.3d 650, 683 (S.D.N.Y. 2018). UMG Recordings, Inc. v. Veoh Networks Inc., 665 F. Supp. 2d 1099, 1111 (C.D. Cal. 2009). Ventura Content, Ltd. v. Motherless, Inc., 885 F.3d 597 (9th Cir. 2018). Viacom Int’l Inc. v. YouTube, Inc., 718 F. Supp. 2d 514, 525 (S.D.N.Y. 2010), aff’d 676 F.3d 19, 31, 35 (2d Cir. 2012). Viacom International, Inc. v. YouTube, Inc., 940 F.Supp.2d 110, 116–17 (S.D.N.Y. 2013). Viacom Int’l Inc., 676 F.3d at 31.

3. Bibliography Bridy, A., ‘Is Online Copyright Enforcement Scalable?’ (2011) 13 Vand. J. Ent. & Tech. L. 695, 716. Carpou, Z., ‘Robots, Pirates, and the Rise of the Automated Takedown Regime: Using the DMCA to Fight Piracy and Protect End-Users’ (2016) 39 Colum. J. L. & Arts 551. Elkin-Koren, N., ‘Making Technology Visible: Liability of Internet Service Providers for Peer-to-Peer Traffic’ (2006) 9 N.Y.U. J. Legis. & Pub. Pol’y 15, 37. Imfeld, C. and V. Smith Ekstrand, ‘The Music Industry and the Legislative Development of the Digital Millennium Copyright Act’s Online Service Provider Provision’ (2005) 10 Comm. L. & Pol’y 291, 305. Karaganis, J. and J. Urban, ‘The Rise of the Robo Notice’ (2015) 58 Communications of the ACM 28. Leistner, M., ‘European Copyright Licensing and Infringement Liability Under Art. 17 DSM Directive Compared to Secondary Liability of Content Platforms in the U.S. – Can We Make the New European System a Global Opportunity Instead of a Local Challenge?’, Zeitschrift Für Geistiges Eigentum/Intellectual Property Journal (forthcoming 2020). Nimmer on Copyright. Perel, M. and N. Elkin-Koren, ‘Accountability in Algorithmic Copyright Enforcement’ (2016) 19 Stan. Tech. L. Rev. 473, 487–88. Sag, M., ‘Internet Safe Harbors and the Transformation of Copyright Law’ (2017) 93 Notre Dame L. Rev. 499, 532–33. Seng, D., ‘The State of the Discordant Union: An Empirical Analysis of the State of DMCA Takedown Notices’ (2014) 18 Va. J.L. & Tech. 369. Urban, J.M., J. Karaganis and B.L. Schofield, ‘Notice and Takedown in Everyday Practice’ (2017) U.C. Berkeley Pub. L. & Legal Theory Res. Paper Series, 44. Weiss, A., ‘Content Filters: Will ISPs Become the Enforcers of the Web?’ (2008) 12(1) netWorker, 24.

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20 THE NETCAB DIRECTIVE Tom Rivers I.

INTRODUCTORY COMMENTS

20.01

II. COMMENTARY

20.23

ARTICLE 6: MEDIATION

CHAPTER I: GENERAL PROVISIONS

II. COMMENTARY

ARTICLE 1: SUBJECT MATTER II. COMMENTARY

20.07

ARTICLE 2 : DEFINITIONS II. COMMENTARY

20.08

CHAPTER II: ANCILLARY ONLINE SERVICES OF BROADCASTING ORGANISATIONS

20.26

ARTICLE 9: AMENDMENT TO DIRECTIVE 93/83/EEC 20.17

II. COMMENTARY

20.30

ARTICLE 10: REVIEW

ARTICLE 3.3 : APPLICATION OF THE COUNTRY OF ORIGIN PRINCIPLE TO ANCILLARY ONLINE SERVICES

II. COMMENTARY 20.18

20.31

ARTICLE 11: TRANSITIONAL PROVISION II. COMMENTARY

CHAPTER III: RETRANSMISSION OF TELEVISION AND RADIO PROGRAMMES

20.32

ARTICLE 12: TRANSPOSITION ARTICLE 13: ENTRY INTO FORCE

ARTICLE 4: EXERCISE OF THE RIGHTS IN RETRANSMISSION BY RIGHTHOLDERS OTHER THAN BROADCASTING ORGANISATIONS II. COMMENTARY

II. COMMENTARY CHAPTER V: FINAL PROVISIONS

ARTICLE 3.2: APPLICATION OF THE COUNTRY OF ORIGIN PRINCIPLE TO ANCILLARY ONLINE SERVICES

II. COMMENTARY

20.25

ARTICLE 8: TRANSMISSION OF PROGRAMMES THROUGH DIRECT INJECTION 20.11

II. COMMENTARY

II. COMMENTARY CHAPTER IV: TRANSMISSION OF PROGRAMMES THROUGH DIRECT INJECTION

ARTICLE 3.1: APPLICATION OF THE COUNTRY OF ORIGIN PRINCIPLE TO ANCILLARY ONLINE SERVICES II. COMMENTARY

20.24

ARTICLE 7: RETRANSMISSION OF AN INITIAL TRANSMISSION ORIGINATING IN THE SAME MEMBER STATE

ARTICLE 14 20.19

ARTICLE 5: EXERCISE OF THE RIGHTS IN RETRANSMISSION BY BROADCASTING ORGANISATIONS

DIRECTIVE (EU) 2019/789 of the European Parliament and of the Council of 17 April 2019 laying down rules on the exercise of copyright and related rights applicable to certain online transmissions of broadcasting organisations and retransmissions of television and radio programmes, and amending Council Directive 93/83/EEC

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I. INTRODUCTORY COMMENTS

[2019] OJ L 130/82 I. INTRODUCTORY COMMENTS It is not unusual to find international agreements in the field of intellectual property that have 20.01 introductory matter referred to, as here, as a Preamble: see for example the WIPO Copyright Treaty (1996) and the WIPO Performances and Phonograms Treaty (1996). It is also not at all unusual to find Recitals (clauses introduced by the word ‘Whereas’) in private or commercial agreements. If, however, one examines British, French or German legislation one will not find Recitals. They are 20.02 not part of the vocabulary of draftsmen of domestic legislation. Recitals are an idiosyncratic feature of EU legal drafting. The Joint Practical Guide of the European Parliament, the Council and the Commission contains 20.03 the following explanation: 10. The purpose of the recitals is to set out concise reasons for the chief provisions of the enacting terms, without reproducing or paraphrasing them. They shall not contain normative provisions or political exhortations […] 10.2 Regulations, directives and decisions must state the reasons on which they are based … to enable any person concerned to ascertain the circumstances in which the enacting institution exercised its powers as regards the act in question to give the parties to a dispute the opportunity to defend their interests and to enable the Community judicature to exercise its powers of review.1

It seems that a Directive without Recitals would be defective and of no effect. With this Directive it is important to bear in mind that the Commission’s initial proposal was a 20.04 Regulation.2 It is instructive to compare the Recitals in the two instruments, as well as the differences between the substantive content of the Articles of each. Recital 1 already sets out a clear direction for the Directive. The ‘proper functioning of the internal 20.05 market’ is a clear allusion to one of Commission President Juncker’s key objectives: the taking of ‘ambitious legislative steps towards a connected Digital Single Market, notably by … modernising copyright roles in the light of the ongoing digital revolution’.3 The Directive refers however to ‘certain types of television and radio programmes’, the draft Regulation lacked this restrictive phrase, which looks forward to the Directive’s Article 3(1). This gives that broad ambition a rather narrow focus in this case. Recital 7 puts that narrow framework also in a special context. It makes reference to ‘the financing 20.06 and production of creative content, and, in particular, of audiovisual works’ and that reference was absent from the draft Regulation. Pricing the license for the ancillary service with a limited content available on it with the financing and production of content in mind embeds the Directive again in the broader context.

1 2 3

Germany v Commission 1963 ECR 63. Proposal for a Regulation 14 September 2016 COM (2016) 594 final. Juncker to Ansip, Mission letter 1 November 2014.

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Chapter 20 THE NETCAB DIRECTIVE

CHAPTER I GENERAL PROVISIONS ARTICLE 1: SUBJECT MATTER This Directive lays down rules that aim to enhance cross-border access to a greater number of television and radio programmes, by facilitating the clearance of rights for the provision of online services that are ancillary to the broadcast of certain types of television and radio programmes, and for the retransmission of television and radio programmes. It also lays down rules for the transmission of television and radio programmes through the process of direct injection.

II. COMMENTARY 20.07 It is interesting to spot that the Directive uses the terms ‘lays down rules’, which is an exaggeration, since it is acknowledged that this is a matter for Member States. It does however refer back to the fact that in origin the instrument aimed for was a Regulation. More importantly, at least from a practical point of view, it sets the tone for provisions that leave Member States limited room for manoeuvre. Enhancing cross-border access to a greater number of television and radio programmes is the aim of the game. Citizens should have greater access to radio and television programmes from other member states in different formats (not only the good old Hertzian broadcast format). Taking account of the technological evolution one could call this Directive the Online Broadcasting and Retransmission Directive. That aim is to be achieved by facilitating the clearance of rights for ancillary services and for the retransmission of radio and television programmes. In addition, the Directive also deals with transmission through direct injection.

NOTES 1. Bibliography Altius Blog, ‘In the shadow of the DSM Directive: the new Online Broadcasting and Retransmission Directive’, https://www.altius.com/blog/501/new-online-broadcasting-and-retransmission-directive.

ARTICLE 2: DEFINITIONS For the purpose of this Directive, the following definitions apply: (1)

(2)

‘ancillary online service’ means an online service consisting in the provision to the public, by or under the control and responsibility of a broadcasting organisation, of television or radio programmes simultaneously with or for a defined period of time after their broadcast by the broadcasting organisation, as well as of any material which is ancillary to such broadcast: ‘retransmission’ means any simultaneous, unaltered and unabridged retransmission, other than cable retransmission as defined in Directive 93/83/EEC, intended for reception by the public, of an initial transmission from another Member State, of television or radio programmes intended for reception by the public, where such initial transmission is by wire or over the air including that by satellite, but is not by online transmissions, provided that:

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ARTICLE 2: DEFINITIONS

(3) (4)

(a) the retransmission is carried out by a party other than the broadcasting organisation which made the initial transmission or under whose control and responsibility that initial transmission was made, regardless of how the party carrying out the retransmission obtains the programme-carrying signals from the broadcasting organisation for the purpose of retransmission; and (b) where the retransmission is over an internet access service as defined in point (2) of the second paragraph of Article 2 of Regulation (EU) 2015/2120, it is carried out in a managed environment; ‘managed environment’ means an environment in which the operator of a retransmission service provides a secure retransmission to authorised users; ‘direct injection’ means a technical process by which a broadcasting organisation transmits its programme-carrying signals to an organisation other than a broadcasting organisation, in such a way that the programme-carrying signals are not accessible to the public during that transmission.

II. COMMENTARY The main service provided by radio and television broadcasters is the broadcasting of programmes. 20.08 That is not what the Directive is concerned with. Instead, the Directive is concerned with what is provided online in addition to the main broadcasts. That provision is done by or under the control and supervision of a broadcasting organisation. Different things can be provided. The easy example is the provision of any material which is ancillary to such a broadcast, such as background information, additional scenes, bloopers, etc. One can also provide the television or radio programmes themselves simultaneously on the Internet, or one can make them available online for a defined period of time after their broadcast by the broadcasting organisation, allowing the public to repeat the screening of the broadcast or to catch up with it. The next important definition is that of retransmission. The Directive is not concerned with cable 20.09 retransmission, as that topic has already been addressed by the EU legislator, but with any simultaneous, unaltered and unabridged retransmission that occurs online and that is intended to be received by the general public. The underlying transmission is one of television or radio programmes from another Member State that is intended for reception by the public and it is made by wire or over the air, including by satellite, but not by online means. The retransmission must be made by a third party unrelated to the original broadcaster, irrespective of how it obtained the original transmission. And in cases where the retransmission is over an Internet access service as defined in point (2) of the second paragraph of Article 2 of Regulation (EU) 2015/2120, it needs to be carried out in a managed environment. That managed environment refers to the involvement of the operator. The operator of a retransmission service needs to provide a secure retransmission to authorised users, rather than merely release the material on the Internet. The final definition is that of a technical process known as direct injection. Rather than 20.10 broadcasting directly to its intended audience a broadcasting organisation transmits its programmecarrying signals to an organisation other than a broadcasting organisation, in such a way that the programme-carrying signals are not accessible to the public during that transmission. That other organisation can typically be a cable operator, who will then make the signals available to its clients via its network of fibre optic cables.

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Chapter 20 THE NETCAB DIRECTIVE

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission [1993] OJ L 248/15.

2. Bibliography Altius Blog, ‘In the shadow of the DSM Directive: the new Online Broadcasting and Retransmission Directive’, https://www.altius.com/blog/501/new-online-broadcasting-and-retransmission-directive.

CHAPTER II ANCILLARY ONLINE SERVICES OF BROADCASTING ORGANISATIONS ARTICLE 3.1: APPLICATION OF THE COUNTRY OF ORIGIN PRINCIPLE TO ANCILLARY ONLINE SERVICES 1.

The acts of communication to the public of works or other protected subject matter, by wire or wireless means and of making available to the public of works or other protected subject matter, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them, occurring when providing to the public: (a) radio programmes; and (b) television programmes which are: (i) news and current affairs programmes; or (ii) fully financed own productions of the broadcasting organisation, in an ancillary online service by or under the control and responsibility of a broadcasting organisation, as well as the acts of reproduction of such works or other protected subject matter which are necessary for the provision of, the access to or the use of such online service for the same programmes shall, for the purposes of exercising copyright and related rights relevant for those acts, be deemed to occur solely in the Member State in which the broadcasting organisation has its principal establishment. Point (b) of the first subparagraph shall not apply to the broadcasts of sports events and works and other protected subject matter included in them.

II. COMMENTARY 20.11 The ways in which media and copyright works are consumed has changed dramatically with the appearance of the Internet. A large number of Internet users use it on a daily basis to access content and as part of that experience they expect to have access to their favourite television and radio programmes at any time and in any place. 20.12 Broadcasters are by no means unwilling in principle to meet that demand and in addition to their regular broadcasts they have started to offer ancillary online services such as simulcasting (simultaneous transmission of regular broadcasts via other channels) and catch-up TV (the opportunity to watch a missed programme later). However, the regular broadcasts are in most cases for a national territory and audience and that fits in neatly with the territorial nature of copyright. Rights are therefore acquired and cleared for the home country of the broadcaster. That stands in sharp contrast with the borderless nature of the Internet. For the ancillary services the broadcasters and

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ARTICLE 3.1: APPLICATION OF THE COUNTRY OF ORIGIN PRINCIPLE TO ANCILLARY ONLINE SERVICES

their partners must clear the copyrights and related rights for each country where the services are accessible. This can be quite complex, expensive and burdensome. The Directive aims to promote the cross-border provision of online services ancillary to broadcasts 20.13 and it is therefore logical that it tries to alleviate such a heavy rights-clearing burden in order to make that aim achievable. A first major step in that direction is the application of the country of origin principle, that finds its roots and first EU application in the 1993 SatCab Directive.4 The scope of the SatCab Directive is, however, limited to satellite broadcasts and cable retransmissions (and transmission by microwave systems) and is not apt for the digital world. This new Directive is therefore intended to update the existing legal framework for the digital world. In practice, within the EU, the (copyrights and related) rights in the programmes must be cleared 20.14 only for the broadcaster’s country of principal establishment. The broadcaster no longer needs to acquire the rights in the other Member States in which it wants to make its ancillary online broadcasting services available. That is the practical outcome of locating any act of communication to the public during the whole technical retransmission process in the country of the broadcaster’s principal establishment. As seen above, the ancillary online services include services that have a ‘clear and subordinate relationship’ with the broadcaster’s regular broadcasts and that can be described as simulcasting, catch-up and the provision of ‘enriching’ materials, such as previews, ‘making-of’ programmes and reviews. The approach applies to all radio programmes, but in terms of television programmes there is now a 20.15 restriction to television programmes which are news and current affairs programmes or programmes that are fully financed own productions of the broadcasting organisation. That allows interfering with the right of third parties in formats for programmes or copyright works that are included in broadcasts. As can be seen from the draft Regulation the original scope was much wider – i.e., to embrace the whole of a broadcaster’s output. The way ancillary online services are defined excludes video-on-demand services. These are not 20.16 ancillary services, but a proper separate service, for which there exists a separate market and for which rights will therefore have to be cleared separately. The Directive however goes further and specifically excludes broadcasts of sports events and works and other protected subject matter included in them. A blanket ban on all sports events seems hard to justify. The underlying reason is however that sports broadcasts are regulated in their own peculiar way and involve large sums of money. The market for sports broadcasts is also organised on a territorial basis and rights are sold on a country-by-country basis at very different rates. A country of origin approach has the potential to undo that market structure and the retransmission of the broadcast from the Member State with the lowest rate would be available everywhere. That would make charging differential rates unsustainable. The legislator therefore decided not to interfere with the sports broadcast altogether, even if the model described above merely applies to football and a few other large sports. In the same line of defining ancillary services it is also clear that the country of origin principle should not apply to any subsequent communication to the public of works or other protected subject matter, by wire or wireless means, or to any subsequent making available to the public of works or other protected subject matter, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them, or to any subsequent reproduction of the works or other protected subject matter which are contained in the ancillary online service. The draft Regulation referred to ‘any subsequent communication to the public’ and the Directive builds on that.5 4 5

Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission, [1993] OJ L 248/15. Recital 9 to the Directive.

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Chapter 20 THE NETCAB DIRECTIVE

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission [1993] OJ L 248/15.

2. Bibliography Altius Blog, ‘In the shadow of the DSM Directive: the new Online Broadcasting and Retransmission Directive’, https://www.altius.com/blog/501/new-online-broadcasting-and-retransmission-directive.

ARTICLE 3.2: APPLICATION OF THE COUNTRY OF ORIGIN PRINCIPLE TO ANCILLARY ONLINE SERVICES 2. Member States shall ensure that, when setting the amount of the payment to be made for the rights to which the country of origin principle, as set out in paragraph 1, applies, the parties take into account all aspects of the ancillary online service, such as features of the service, including the duration of online availability of the programmes provided in that service, the audience, and the language versions provided. The first subparagraph shall not preclude calculation of the amount of the payment on the basis of the broadcasting organisation’s revenues.

II. COMMENTARY 20.17 Having established the principle that rights will be cleared in one country, the amount due and the calculation of the amount due become the next important issue. Member States are asked to ensure that all aspects of the ancillary online service, such as features of the service, including the duration of online availability of the programmes provided in that service, the audience, and the language versions provided are fully taken into account. A tailormade approach is therefore advocated. Whilst this is at least conceptually a complex affair, it should in practice not necessarily lead to various amounts being calculated and added up. One can also use all these factors to calculate a single amount or percentage that is related to the broadcasting organisation’s revenues.

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission [1993] OJ L 248/15.

2. Bibliography Altius Blog, ‘In the shadow of the DSM Directive: the new Online Broadcasting and Retransmission Directive’, https://www.altius.com/blog/501/new-online-broadcasting-and-retransmission-directive.

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ARTICLE 4: EXERCISE OF THE RIGHTS IN RETRANSMISSION BY RIGHTHOLDERS

ARTICLE 3.3: APPLICATION OF THE COUNTRY OF ORIGIN PRINCIPLE TO ANCILLARY ONLINE SERVICES 3. The country of origin principle set out in paragraph 1 shall be without prejudice to the contractual freedom of the rightholders and broadcasting organisations to agree in compliance with Union law, to limit the exploitation of such rights, including those under Directive 2001/29/EC.

II. COMMENTARY Clearing rights in a single Member State does not means that all licences need to be EU wide. 20.18 Parties can still decide by contract to merely exploit rights in one or more Member States (and therefore merely licence the rights for the Member States concerned). Certain broadcasts can after all merely be relevant for a certain territory. Competition law may however be called upon to deal with any abuse of this contractual freedom, e.g., if market segregation in the single market were to follow. Indeed, ‘compliance with Union law’ includes decisions of the CJEU in the field of competition law such as FAPL v QC Leisure and Karen Murphy,6 which implies that territorial exclusivity has certain limits.

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission [1993] OJ L 248/15.

2. CJEU case law Joined Cases C 403/08 and C429/08 FAPL v QC Leisure and Karen Murphy ECLI:EU:C:2011:631.

3. Bibliography Altius Blog, ‘In the shadow of the DSM Directive: the new Online Broadcasting and Retransmission Directive’, https://www.altius.com/blog/501/new-online-broadcasting-and-retransmission-directive.

CHAPTER III RETRANSMISSION OF TELEVISION AND RADIO PROGRAMMES ARTICLE 4: EXERCISE OF THE RIGHTS IN RETRANSMISSION BY RIGHTHOLDERS OTHER THAN BROADCASTING ORGANISATIONS 1.

6

Acts of retransmission of programmes have to be authorised by the holders of the exclusive right of communication to the public. Member States shall ensure that rightholders may exercise their right to grant or refuse the authorisation for a retransmission only through a collective management organisation.

Joined Cases C 403/08 and C429/08 FAPL v QC Leisure and Karen Murphy ECLI:EU:C:2011:631.

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2.

3.

Where a rightholder has not transferred the management of the right referred to in the second subparagraph of paragraph 1 to a collective management organisation, the collective management organisation which manages rights of the same category for the territory of the Member State for which the operator of a retransmission service seeks to clear rights for a retransmission shall be deemed to have the right to grant or refuse the authorisation for a retransmission for that rightholder. However, where more than one collective management organisation manages rights of that category for the territory of that Member State, it shall be for the Member State for the territory of which the operator of a retransmission service seeks to clear rights for a retransmission to decide which collective management organisation or organisations have the right to grant or refuse the authorisation for a retransmission. Member States shall ensure that a rightholder has the same rights and obligations resulting from an agreement between an operator of a retransmission service and a collective management organisation or organisations that act pursuant to paragraph 2, as rightholders who have mandated that collective management organisation or organisations. Member States shall also ensure that that rightholder is able to claim those rights within a period, to be fixed by the Member State concerned, which shall not be shorter than three years from the date of the retransmission which includes his or her work or other protected subject matter.

II. COMMENTARY 20.19 Article 4 is the first article in Chapter III on the retransmission of television and radio programmes. It follows therefore that Article 4 only deals with aspects of the retransmission of television and radio programmes and that retransmissions of initial online transmissions are excluded from its scope. Retransmissions via ‘open internet’ are on the other hand covered, provided that they take place in a ‘managed environment’, i.e., they are subject to some kind of digital identification. Finally, retransmission rights of the broadcasters are specifically dealt with by Article 5. 20.20 More specifically Article 4 deals with the exercise of rights in retransmission in so far as these rights are held and exercised by rightholders other than broadcasting organisations. After stating that retransmissions of programmes must be authorised by the rights holders and thereby preserving the principle of the exclusive right as part of copyright, the Directive imposes the obligation upon Member States of ensuring that rightholders may exercise their right to authorise or refuse only through CMOs. This amends de facto the provision in the SatCab Directive to all types of retransmission of television and radio programmes by other entities than the broadcasting organisation. 20.21 The obvious problem that arises from the mandatory involvement of a CMO is that not all rightholders will have transferred their rights to a CMO. That problem is solved in paragraph 2 by the introduction of an element of extended collective licensing. The CMO which manages rights of the same category for the territory of the Member State for which the operator of a retransmission service seeks to clear rights for a retransmission shall be deemed to have the right to grant or refuse the authorisation for a retransmission for that rightholder. If there are two CMOs for a certain category Member States will have to put in place a mechanism to decide who can clear the rights. 20.22 A rightholder whose rights are cleared under the extension should not receive less favourable treatment than the members of the CMO and they shall have at least three years from the date of the retransmission to claim their rights.

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ARTICLE 6: MEDIATION

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission [1993] OJ L 248/15.

2.

Bibliography

Altius Blog, ‘In the shadow of the DSM Directive: the new Online Broadcasting and Retransmission Directive’, https://www.altius.com/blog/501/new-online-broadcasting-and-retransmission-directive.

ARTICLE 5: EXERCISE OF THE RIGHTS IN RETRANSMISSION BY BROADCASTING ORGANISATIONS 1.

2.

Member States shall ensure that Article 4 does not apply to the rights in retransmission exercised by a broadcasting organisation in respect of its own transmission, irrespective of whether the rights concerned are its own or have been transferred to it by other rightholders. Member States shall provide that, where broadcasting organisations and the operators of retransmission services enter into negotiations regarding authorisation for retransmission under this Directive, those negotiations are to be conducted in good faith.

II. COMMENTARY Retransmission rights of the broadcasters are excluded from the scope of Article 4 in order for 20.23 Article 5 to deal with them specifically. The exclusion applies irrespective of whether the rights concerned are its own or have been transferred to it by other rightholders. Clearing these rights is simply left to the negotiations between the parties. There is no mandatory clearance of rights through a CMO. Member States are merely charged with the task of making sure that these negotiations are conducted in good faith. A blatant refusal to licence and to enter into negotiations may therefore turn out to be a problem.

NOTES 1. Bibliography Altius Blog, ‘In the shadow of the DSM Directive: the new Online Broadcasting and Retransmission Directive’, https://www.altius.com/blog/501/new-online-broadcasting-and-retransmission-directive.

ARTICLE 6: MEDIATION Member States shall ensure that it is possible to call upon the assistance of one or more mediators as provided for in Article 11 of Directive 93/83/EEC where no agreement is concluded between the collective management organisation and the operator of a retransmission service, or between the operator of a retransmission service and the broadcasting organisation regarding authorisation for retransmission of broadcasts.

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Chapter 20 THE NETCAB DIRECTIVE

II. COMMENTARY 20.24 One should not underestimate the risk that no agreement can be concluded between the collective management organisation and the operator of a retransmission service, or between the operator of a retransmission service and the broadcasting organisation regarding authorisation for retransmission of broadcasts. The parties have different interests and there may also be an imbalance in terms of bargaining power. Article 6 tries to reduce that risk by imposing the introduction of a system of mediation with one or more mediators, which should at the very least reduce the risk of recourse to lengthy and costly litigation in court. This is again an extension of the proven system of the SatCab Directive.

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission [1993] OJ L 248/15.

ARTICLE 7: RETRANSMISSION OF AN INITIAL TRANSMISSION ORIGINATING IN THE SAME MEMBER STATE Member States may provide that the rules in this Chapter and in Chapter III of Directive 93/83/EEC apply to situations where both the initial transmission and the retransmission take place within their territory.

II. COMMENTARY 20.25 Chapter III is based on the idea that the initial transmission and the retransmission take place in different Member States. CMO rights management is then the second facilitating element in a cross-border environment, after the introduction of a country of origin approach. Article 7 adds that nothing stops the Member States from adopting the same approach in a purely domestic setting. Arguably that is as far as EU law can go, as in the absence of an impact on the single market there is no EU legislative mandate to impose a precise solution. Be that as it may, as a ‘may’ provision Article 7 imposes no obligation, and if the effect is that some Member States do, but others do not take up the suggestion, it will not do much to widen the Digital Single Market.

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission [1993] OJ L 248/15.

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ARTICLE 8: TRANSMISSION OF PROGRAMMES THROUGH DIRECT INJECTION

CHAPTER IV TRANSMISSION OF PROGRAMMES THROUGH DIRECT INJECTION ARTICLE 8: TRANSMISSION OF PROGRAMMES THROUGH DIRECT INJECTION 1.

2.

When a broadcasting organisation transmits by direct injection its programme-carrying signals to a signal distributor, without the broadcasting organisation itself simultaneously transmitting those programme-carrying signals directly to the public, and the signal distributor transmits those programme-carrying signals to the public, the broadcasting organisation and the signal distributor shall be deemed to be participating in a single act of communication to the public in respect of which they shall obtain authorisation from rightholders. Member States may provide for arrangements for obtaining authorisation from rightholders. Member States may provide that Articles 4, 5 and 6 of this Directive apply mutatis mutandis to the exercise by rightholders of the right to grant or refuse the authorisation to signal distributors for a transmission referred to in paragraph 1, carried out by one of the technical means referred to in Article 1(3) of Directive 93/83/EEC or point (2) of Article 2 of this Directive.

II. COMMENTARY An increasing number of programmes are transmitted by ‘direct injection’, which is in essence a 20.26 technical process by which a broadcaster transmits its programme carrying signals to distributors via a closed circuit after which the signals are then (re)transmitted to the public. The programmes are as it were directly injected into the distributors’ distribution system (such as a cable television network) that distributes them to the public. The main question that arises is whether there are one or two acts of communication to the public involved in this process and who is responsible for requesting the rights holders’ authorisation and thus for paying royalties: the broadcaster, the distributor or both. That question was eventually answered by the Court of Justice of the European Union in the SBS Belgium case.7 The CJEU ruled that direct injection entails a single act of communication to the public and that this act should in principle be attributed to the distributors, unless the intervention of the latter is just a technical means used by the broadcaster to reach its own public. The Belgian Supreme Court later confirmed in a judgment of 30 September 2016 that direct injection implies only one communication to the public.8 One could therefore assume that the attribution of responsibility for the unique act of communication to the public involves a straightforward choice. Either it is the broadcaster’s responsibility or it is the responsibility of the distributor.9 The Directive follows the case law to the extent that it confirms that direct injection does indeed 20.27 constitute a single act of communication to the public. But it departs from the case law by adding that both the broadcaster and the distributor are deemed to participate in that act of communication to the public and that as a consequence they must obtain the necessary authorisations from the rights holders. Member States may put in place arrangements to facilitate the obtaining of such an authorisation. Nonetheless, Recital 20 confirms that, when distributors merely provide broadcasters with ‘technical means’ to ensure that the broadcast is received or to improve the reception of the 7 8 9

Case C-325/14 SBS Belgium NV v SABAM ECLI:EU:C:2015:764. Hof van Cassatie/Cour de Cassation, judgment of 30 September 2016, http://jure.juridat.just.fgov.be/pdfapp/download_ blob?idpdf=F-20160930-1. Altius Blog, ‘In the shadow of the DSM Directive: the new Online Broadcasting and Retransmission Directive’, https://www.altius.com/blog/501/new-online-broadcasting-and-retransmission-directive.

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Chapter 20 THE NETCAB DIRECTIVE

broadcast, within the meaning of the CJEU’s case law, the distributors should not be considered to be participating in the act.10 20.28 The statement in Article 8.1 that ‘the broadcasting organisation and the signal distributor shall be deemed to be participating in a single act of communication to the public’ seems to be inconsistent with Recital 21 where the text says that ‘the transmissions by those other organisations constitute a separate act of communication to the public from the one carried out by the broadcasting organisation’. One should however clearly distinguish the factual scenario in Recital 21. Here we have a broadcasting organisation that is transmitting directly to the public, carrying out an initial act of transmission or communication to the public for which an authorisation is required if it does not own all the rights in the content of the programmes. On top of that there is transmission to other organisations through direct injection. The logic that is applied here is that the authorisation obtained by the broadcaster covers the totality of the first communication, i.e., to its own public and to the other organisations. If the latter retransmit, they then need their separate authorisation. Article 8.1 makes that clear when it limits the special direct injection regime to the scenario where ‘a broadcasting organisation transmits by direct injection its programme-carrying signals to a signal distributor, without the broadcasting organisation itself simultaneously transmitting those programmecarrying signals directly to the public ’.11 20.29 Member States are given the freedom to apply the regime of Chapter III of the Directive for the retransmission of television and radio programmes mutatis mutandis to the exercise by rightholders of the right to grant or refuse the authorisation to signal distributors for a transmission referred to in Article 8.1.12

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission [1993] OJ L 248/15. Regulation (EU) 2015/2120 of the European Parliament and of the Council of 25 November 2015 laying down measures concerning open internet access and amending Directive 2002/22/EC on universal service and users’ rights relating to electronic communications networks and services and Regulation (EU) No 531/2012 on roaming on public mobile communications networks within the Union [2015] OJ L 310/1.

2. CJEU case law / national case law Case C-325/14 SBS Belgium NV v SABAM ECLI:EU:C:2015:764. Hof van Cassatie/Cour de Cassation, judgment of 30 September 2016, http://jure.juridat.just.fgov.be/pdfapp/ download_blob?idpdf=F-20160930-1.

3. Bibliography Altius Blog, ‘In the shadow of the DSM Directive: the new Online Broadcasting and Retransmission Directive’, https://www.altius.com/blog/501/new-online-broadcasting-and-retransmission-directive.

10 11 12

Recital 20 to the Directive. Art. 8.1 of the Directive, my italics. Art. 8.2 of the Directive.

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ARTICLE 11: TRANSITIONAL PROVISION

CHAPTER V FINAL PROVISIONS ARTICLE 9: AMENDMENT TO DIRECTIVE 93/83/EEC In Article 1 of Directive 93/83/EEC, paragraph 3 is replaced by the following ‘3. For the purposes of this Directive, “cable retransmission” means the simultaneous, unaltered and unabridged retransmission by a cable or microwave system for reception by the public of an initial transmission from another Member State, by wire or over the air, including that by satellite, of television or radio programmes intended for reception by the public, regardless of how the operator of a cable retransmission service obtains the programme-carrying signals from the broadcasting organisation for the purpose of retransmission.’

II. COMMENTARY The change is found in the last bit of the provision. The added detail is that the definition applies 20.30 ‘regardless of how the operator of a cable retransmission service obtains the programme-carrying signals from the broadcasting organisation for the purpose of retransmission’.

NOTES 1. Related instruments Council Directive 93/83/EEC of 27 September 1993 on the coordination of certain rules concerning copyright and rights related to copyright applicable to satellite broadcasting and cable retransmission [1993] OJ L 248/15.

ARTICLE 10: REVIEW 1.

2.

By 7 June 2025, the Commission shall carry out a review of this Directive and present a report on the main findings to the European Parliament, the Council and the European Economic and Social Committee. The report shall be published and made available to the public on the website of the Commission. Member States shall provide the Commission, in a timely manner, with the relevant and necessary information for the preparation of the report referred to in paragraph 1.

II. COMMENTARY The Commission is charged with carrying out a review of the Directive by 7 June 2025 and the 20.31 Member States should assist in that effort by providing the necessary information.

ARTICLE 11: TRANSITIONAL PROVISION Agreements on the exercise of copyright and related rights relevant for the acts of communication to the public of works or other protected subject matter, by wire or wireless means, and the making available to the public of works or other protected subject matter, by wire or wireless

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means, in such a way that members of the public may access them from a place and at a time individually chosen by them, occurring in the course of provision of an ancillary online service as well as for the acts of reproduction which are necessary for the provision of, the access to or the use of such online service which are in force on 7 June 2021 shall be subject to Article 3 as from 7 June 2023 if they expire after that date. Authorisations obtained for the acts of communication to the public falling under Article 8 which are in force on 7 June 2021 shall be subject to Article 8 as from 7 June 2025 if they expire after that date.

II. COMMENTARY 20.32 The Directive, and in particular Article 3, puts in place a radically new system. In order to smooth the transition existing agreements are left untouched until 7 June 2023. They will only become subject to Article 3 from that day onwards if they expire at a later date. The same applies to authorisations for acts of communication to the public that fall under Article 8.

ARTICLE 12: TRANSPOSITION 1.

2.

Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 7 June 2021. They shall immediately inform the Commission thereof. When Member States adopt those measures, they shall contain a reference to this Directive or shall be accompanied by such reference on the occasion of their official publication. The methods for making such reference shall be laid down by Member States. Member States shall communicate to the Commission the text of the measures of national law which they adopt in the field covered by this Directive.

ARTICLE 13: ENTRY INTO FORCE This Directive shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union

ARTICLE 14 This Directive is addressed to the Member States.

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Part III EU POLICIES AND ACTIONS

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21 THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY Olivier Vrins I.

INTRODUCTION

II. FROM THE BERNE CONVENTION TO THE WIPO INTERNET TREATIES

1. Legislative actions A. The E-Commerce Directive B. The ‘Telecom Package’ C. The InfoSoc Directive and the IPRED D. The compatibility of injunctions, blocking orders, filtering obligations, and convictions for copyright or related rights infringement with fundamental rights E. The DSM Directive 2. Non-legislative actions

21.01 21.08

III. THE AWAKENING OF THE EUROPEAN UNION TO THE PROBLEM OF PIRACY 21.16 1. Genesis and development of the EU policies and actions in the fight against piracy 21.16 2. The EU approach to the fight against piracy in a nutshell 21.34 IV. THE FIGHT AGAINST PIRACY IN THE INTERNAL MARKET AND AT THE EU’S EXTERNAL BORDERS 21.36 1. Legislative actions 21.36 A. Civil enforcement of copyright and related rights 21.36 B. Customs enforcement of copyright and related rights 21.72 C. Criminal enforcement of copyright and related rights 21.88 2. Non-legislative actions 21.96 A. Stakeholders’ dialogues 21.97 B. The European Observatory on Infringements of Intellectual Property Rights 21.98 C. The fight against intellectual property crime: policial and judicial cooperation 21.120 D. Risk-analysis tools and electronic data interchange systems 21.132 V. THE FIGHT AGAINST PIRACY ON THE INTERNET

VI. THE FIGHT AGAINST PIRACY IN THIRD COUNTRIES 1. Legislative actions A. Multilateral and plurilateral agreements B. Bilateral agreements 2. Non-legislative actions A. Intellectual property dialogues and IPR working groups B. Technical cooperation C. Participation in international fora D. The ‘Counterfeit and Piracy Watch List’ 3. Assessment of the EU’s foreign policies on IPR enforcement

21.139 21.139 21.153 21.154

21.155 21.186 21.194 21.199 21.205 21.205 21.253 21.259 21.259 21.262 21.264 21.282 21.283

VII. CONCLUSION: WHERE DO WE STAND AND WHERE ARE WE GOING? 21.288

21.135

I. INTRODUCTION 21.01

‘Used as a noun, any child would be able to describe the archetypal pirate just by listing his most characteristic features: the wooden leg, the hook for a hand, the unkempt beard and the eye patch, which are the inevitable price of choosing such a risky way of life, full of adventures and dangers. […] The noun is used, by extension, as an adjective, particularly in conjunction with goods, referring to their lack of authenticity or the unorthodox means used to put them on the market. But this definition contrasts with the real spoils obtained by these characters, because the riches that they stole were never considered illegal, only

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I. INTRODUCTION their seizure by force from the rightful owners. One poet, in an ode to rebellion typical of that era, wrote that his ship was the pirate’s most valued possession, prized above all the fabulous stolen treasures.’1

It was thus that the late lamented Damaso Ruiz-Jarabo Colomer, who was visibly in a good mood on 8 April 2008, tried to define the concept of ‘piracy’ – in a case which, in passing, was not only nothing to do with copyright law2 but was, furthermore, to do with genuine goods.3,4 Even for intellectual property law specialists, the concept of ‘piracy’ is not without ambiguity. It is 21.02 generally applied to goods produced by infringing copyright or related rights.5 Depending on the context, it could refer to any type of infringement of a copyright or related right6 (this definition will be retained in this chapter), or to illicit slavish copying of a work protected by copyright or related rights.7 However, the concept of ‘pirated goods’ is sometimes applied, by extension, to industrial designs.8 Moreover, while ‘piracy’ is often distinguished from ‘counterfeiting’, a term generally used to describe infringements of industrial property rights – and more specifically of trademark rights – ‘counterfeiting’ and ‘piracy’ are sometimes used as substitutable terms, understood as covering any infringement of intellectual property rights (IPRs).9 However, genuine goods, which have been manufactured by the right holder or with his consent, have been placed on the market in a specific country with the authorisation of the latter, and then are imported into another country without the right holder’s consent, are traditionally not considered ‘counterfeit’ or ‘pirated’ goods.

1 2 3 4

5

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Opinion of Advocate General Colomer in case C-132/07 Beecham Group v. Andacon NV, 8 April 2008, ECLI: EU:C:2008:205, paras 2 and 4. The case concerned trademark law. The case concerned parallel imports of genuine toothpaste. The ambiguity of the concept of ‘piracy’ also exists in French, where the word ‘piraterie ’, used to describe the crimes committed by one-eyed, one-legged barbarians who sailed the seven seas in Epinal’s pictures, is also often used as a synonym of ‘piratage’, which refers to straightforward copyright and related right infringements, in particular in the audiovisual and computer sectors. See the definition of ‘pirated goods which infringe copyright’ in note 14 under Art. 51 of the TRIPS Agreement (Agreement on Trade-Related Aspects of Intellectual Property Rights, Annex 1C to the Marrakesh Agreement Establishing the World Trade Organization (WTO), signed in Marrakesh on 15 April 1994). The EUIPO’s ‘Report on the EU Enforcement of Intellectual Property Rights: Results at the EU Borders and in Member States 2013–2017’ (September 2019, ) defines ‘pirated goods’ as tangible goods that infringe copyright; no reference is made here to related rights. Cf. the definition of ‘pirated goods which infringe copyright’ in note 14 under Art. 51 of the TRIPS Agreement, and of ‘pirated goods’ in Art. 2(6) of Regulation (EU) No 608/2013 concerning customs enforcement of intellectual property rights and repealing Council Regulation (EC) No 1383/2003 [2013] OJ L181/15. Cf. the definition of ‘pirated goods’ in Art. 2(6) of Reg. 608/2013. See, e.g., the Communication of 11 September 2009 from the Commission to the Council, the European Parliament and the European Economic and Social Committee ‘Enhancing the enforcement of intellectual property rights in the internal market’, COM(2009) 467 final, 3, fn 1. In Belgium, Art. XI.293 of the Code of Economic Law refers to wilful copyright infringements as ‘counterfeiting’; the same applies, e.g., in France (cf., e.g., Arts L. 335-2 and L. 335-3 of the Intellectual Property Code). Likewise, the Anti-Counterfeiting Trade Agreement (ACTA) not only relates to trademark counterfeiting, but also addresses copyright piracy. The OECD also defines ‘counterfeiting’ as covering any ‘infringement of the legal rights of an owner of intellectual property’. While it reckons that, ‘[t]echnically, the English term “counterfeiting” only refers to specific cases of trademark infringement’, it further stresses that: in practice, the term is allowed to encompass any making of a product which so closely imitates the appearance of the product of another as to mislead a consumer that it is the product of another. Hence, it may also include the unauthorised production and distribution of a product that is protected by other intellectual property rights, such as copyright and neighbouring rights. This is in line with the German term ‘Produktpiraterie ’ and the French term ‘contrefaçon ’, which both cover a broader range of intellectual property right infringements (OECD, The Economic Consequences of Counterfeiting (1998), 5, ).

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Chapter 21 THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY

21.03 An examination of the economic and social consequences of piracy and an estimate of its extent are both outside the scope of this chapter. Much ink has been spilled on this subject.10 Counterfeiting and piracy often lead to a loss of turnover, a reduction in profits, and a loss of market shares for right holders; they also disrupt their distribution networks and bring about high enforcement costs, while also undermining the goodwill of businesses, as well as the attractiveness of their brands and products. The government of countries where counterfeit and pirated goods are sold also experience economic losses (reduction in GDP), losses of jobs,11 and losses of fiscal and social security revenues.12 ‘Producer’ countries also suffer losses of tax and social security income – due to the clandestine nature of counterfeiting and piracy – and a loss of foreign investment.13 As regards the scale of the problem, various figures have been suggested in recent years, and then partially denied. It suffices to refer here to the – much criticised – 1998 OECD study on ‘The Economic Consequences of Counterfeiting’,14 which suggested that between 5 and 7 per cent of global trade by value involved counterfeit or pirated goods. This claim was challenged by the OECD itself in 2007, when it emphasised that no reliable methodology could establish a serious estimate of the

10

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12 13 14

For an analysis of the scope and consequences of counterfeiting and piracy, see, inter alia, M. Schneider and O. Vrins, ‘The magnitude and the economic and social consequences of counterfeiting and piracy’, in O. Vrins and M. Schneider (eds), Enforcement of Intellectual Property Rights through Border Measures. Law and Practice in the EU, 2nd ed., Oxford University Press, 2012, 3–25. According to the European Commission’s Green Paper of 15 October 1998 ‘Combating Counterfeiting and Piracy in the Internal Market’ (COM(98) 569 final), counterfeiting in the EU would result in the loss of 100,000 jobs a year in the EU. In a press release dated 11 October 2005 (MEMO/05/364, ), the Commission quoted the figure of 200,000 jobs lost in Europe. The creative industry, for its part, estimates that piracy has cost the European music, movie, TV and software industry €10 billion and more than 185,000 jobs in 2008 (see the Press Release IP/11/630 of 24 May 2011 at ). According to the software sector, reducing the piracy rate for personal computer software by 10 per cent in four years would create nearly 500,000 new high-tech jobs and generate roughly USD 32 billion in new tax revenues (Business Software Alliance (BSA), Piracy Impact Study: The Economic Benefits of Reducing Software Piracy (2010), ). According to a study conducted jointly by the European Union Intellectual Property Office (‘EUIPO’; formerly, Office for Harmonisation in the Internal Market (Trade Marks and Designs) or ‘OHIM’), acting through the European Observatory on Infringements of Intellectual Property Rights, and the European Patent Office (‘EPO’), during the period 2008–10 IPR-intensive industries – defined as those having an above average use of IPRs per employee – generated more than a quarter (26%) of employment and more than a third (39%) of economic activity in the EU (GDP), worth €4.7 trillion. Copyright-intensive industries account for smaller proportions (i.e., respectively 3.2% and 4.2%); 88% of EU imports consist of products of IPR-intensive industries, with an even higher share of EU exports (90%) being accounted for by IPR-intensive industries. The shares of export and import of copyright-intensive industries represent 4.2% and 2.7%, respectively. Although the EU has a trade deficit in trademark-intensive and patent-intensive products, this deficit is to some degree offset by trade surpluses in copyright- and design-intensive industries. Cf. OHIM-EPO, ‘Intellectual property rights intensive industries: contribution to economic performance and employment in the European Union. Industry-Level Analysis Report’ (first edition, September 2013), . During the period 2014–16, IPR-intensive industries accounted for most of the EU’s trade in goods and services with the other regions of the world (81%); 45% of economic activity in the EU, worth €6.6 trillion annually, was generated by IPR-intensive industries. More than a quarter (29%) of all employment in the EU, totalling 63 million jobs, was provided directly by these industries, while a further 21 million people are employed in sectors that supply these industries with goods and services. Employment in IPR-intensive industries grew by 1.3 million jobs compared with 2011–13, while total employment in the EU underwent a slight decline. IPR-intensive industries pay significantly higher wages, which shows that the value added per employee in these industries is higher than in the rest of the economy: average salaries in IPR-intensive industries are on average 47% higher than in other industries: see EUIPO-EPO, ‘IPR-intensive industries and economic performance in the European Union. Industry-Level Analysis Report’ (3rd ed., September 2019), . See, on this suject, M. von Welser and A. Gonzales, Marken- und Produktpiraterie: Strategien und Lösungsänsatze zu ihrer Bekämpfung, Wiley-VCH, 2007. See OECD, The Impact of Trade-Related Intellectual Property Rights on Trade and Foreign Direct Investment in Developing Countries, 2003, . OECD, The Economic Consequences of Counterfeiting, Paris, 1998, .

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I. INTRODUCTION

phenomenon, due to the clandestine nature of the activities involved, the lack of precise statistics, and the difficulty of distinguishing counterfeit and pirated goods from genuine goods. In its 2007 Report on the Economic Impact of Counterfeiting and Piracy, the OECD estimated – essentially based on the seizure statistics reported by Customs – that the international trade in counterfeit and pirated goods may have been worth some USD 200 billion in 2005, and indicated that the total value of trade in such goods could have exceeded this amount by several hundreds of billions of dollars. It is noteworthy that this estimate did not include the value of counterfeit and pirated digital products distributed over the internet. The report also stated that one of the biggest challenges facing governments and businesses was getting reliable and up-to-date information on the extent of counterfeiting and piracy and its social and economic impact, including its impact on employment in Europe.15 According to an update of the study from 2009, counterfeit and pirated goods in international trade continued to grow steadily over the period 2000–07 and could have amounted to USD 250 billion in 2007.16 The latest update published in 2019 of the OECD-EUIPO joint study concludes that trade in counterfeit and pirated goods continued to rise in the period up to 2016, reaching 3.3 per cent of world trade (compared to 2.5 per cent in the earlier study) and 6.8 per cent of EU imports from third countries (up from 5 per cent in the previous study).17 The OECD’s methodology in its reports of collating the figures reported by Customs has the advantage of being objective; however, the overall figure was reached by pure extrapolation, since nobody knows how many counterfeit or pirated goods are not seized by Customs. Furthermore, border measures are only applied by EU Member States’ customs authorities at the external borders of the EU. The wide range of information held by national enforcement agencies and European and national intellectual property offices is often difficult to assimilate. As regards the figures pubished by sources other than the OECD,18 they are often based on data supplied by right holders or by sectoral organisations, which may be tempted to either exaggerate them to obtain more government support, or to underestimate them so as not to alarm consumers.19 In its Communication of 11 September 2009, the Commission regretted in this regard that ‘despite work carried out in some sectors to analyse the scope and scale of the problem the figures use different methods and sources, with the resulting lack of comparative data’.20 The lack of reliable figures makes it difficult to influence policies and back them up with statistics. The initiative of the European Union Intellectual Property Office to

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OECD, The Economic Impact of Counterfeiting and Piracy, 2008, . OECD, Magnitude of Counterfeiting and Piracy of Tangible Products, an update, November 2009, . Bian and Moutinho estimated that the loss caused by trade of counterfeit and pirated goods in 2008 was approximately USD 300 billion (X. Bian and L. Moutinho, ‘An investigation of determinants of counterfeit purchase consideration’, (2009) Journal of Business Research, 62, 368–78). This figure is corroborated by the results of a more recent study released on 22 May 2013 by a private, non-partisan, advisory panel, made up of former high-ranking US officials and co-chaired by the former US ambassador to China and Republican presidential candidate Jon Huntsman. This report comes to the conclusion that growing IP theft, mainly in China, is costing the US more than USD 300 billion each year (‘Report of the Commission on the Theft of American Intellectual Property’, available at ). OECD-EUIPO, Trends in Trade in Counterfeit and Pirated Goods, 2019, . Such as the reports commissioned by Business Action to Stop Counterfeiting and Piracy (BASCAP) ‘Estimating the global economic and social impacts of counterfeiting and piracy’ (February 2011) and ‘Building a Digital Economy: The Importance of Saving Jobs in the EU’s Creative Industries’ (March 2010), both available at . Centre for Economics and Business Research, Counting Counterfeits: Defining a Method to Collect, Analyze and Compare Data on Counterfeiting and Piracy in the Single Market (2002), . Hence, the report of November 2010 commissioned by the European Commission on the ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’ concludes that the OECD study represents the only credible assessment of the impact of counterfeiting and piracy on the world economy (, 31). Commission Communication of 11 September 2009, 5.

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Chapter 21 THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY

develop a methodology for the collection and evaluation of data on counterfeiting and piracy, in order to establish neutral and reliable figures within the internal market,21 is therefore a welcome development. 21.04 In 2018, EU Customs detained slightly less than 27 million products suspected of violating IPRs, compared to 115 million in 2010, as a result of the high number of small consignments, probably due to the growth of the e-commerce market. In the largest number of cases, the goods were detained through postal and express carrier transport (83.29 per cent), followed by air transport (12.91 per cent). Less than 70,000 detention cases were registered by Customs (a decrease of almost 23 per cent compared to 2010).22 The majority of articles (88 per cent) detained by Customs were suspected of infringing a trademark, with only 0.63 per cent of the goods being suspected of infringing copyright or related rights (against 14 per cent in 2004).23 However, those figures should not be taken to reflect the real picture; many items detained by Customs infringe multiple IPRs, but are only reported as trademark infringements due to the fact that it is, in general, easier to identify goods bearing a counterfeit trademark than goods infringing copyright. The statistics single out China as the main country of provenance of counterfeit and pirated goods, accounting for 50.55 per cent of all seized items (against almost 85 per cent in 2010). Next come Hong Kong, China (9.43 per cent), Turkey (7.02 per cent), Georgia (3.01 per cent), and Vietnam (2.36 per cent).24 As far as software is concerned, advances in technology have made it possible to pirate all intellectual property protected content in digital form without revealing the seller’s location.25 The production of counterfeit and pirated goods is not confined to non-EU countries, as is shown by the high number of stickers, labels, tags and packaging materials detained by Customs, which accounted altogether to 18.3 per cent of all seized goods.26 21.05 In September 2019, the European Observatory on Infringements of Intellectual Property Rights published the very first joint analysis of two sources of data, namely, the data on detentions at EU

21 22

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See below, paras 21.98–21.119, in this regard. European Commission (DG TAXUD), ‘Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2011’, ; ‘Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2018’, . In the latter category, toys and clothing featuring images of famous cartoon figures were the most affected products. Foodstuffs are often involved too, because of the packaging material containing copyright-protected images or names. See European Commission (DG TAXUD), ‘Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2018’, , p. 17. In 2018, the World Customs Organization (WCO) reported 60,134 seizures of goods suspected of infringing intellectual property rights in 61 countries. Despite a significant increase compared to 2017 (27,357 seizures), the number of seized items dropped from 372 million in 2017 to 55 million in 2018, as over 70% of the 60,134 detentions related to mail parcels. These case-and-seizure data may not present a comprehensive view of intellectual property right infringements, however, since many WCO member customs administrations did not provide any figures. See the WCO’s Illicit Trade Report 2018, , p. 114. European Commission (DG TAXUD), ‘Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2018’, , p. 16. In the US, the number of seizures involving goods suspected of infringing IPRs at the borders in fiscal year 2018 amounted to 33,810. The manufacturer’s suggested retail price of seized goods increased to nearly USD 1.4 billion in fiscal year 2018 from over USD 1.2 billion in 2017: US Customs and Border Protection Office of Trade, ‘Intellectual Property Rights Fiscal Year 2018 Seizure Statistics’, . B. Godart (Europol Liaison Officer to Interpol), ‘The involvement of organized crime in intellectual property rights infringements’, in O. Vrins and M. Schneider, Enforcement of Intellectual Property Rights through Border Measures. Law and Practice in the EU, para. 2.31. European Commission (DG TAXUD), ‘Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2018’, , p. 6.

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I. INTRODUCTION

borders reported by customs authorities via the European Commission, and on detentions within their national markets by 24 of the then 28 Member State enforcement authorities. The objective of this new ‘Report on the EU Enforcement of Intellectual Property Rights’, which is planned to be updated and published regularly, is to inform EU enforcers and policymakers of the trends and estimates of the counterfeit and pirated goods detained within the EU. The first issue27 covers the years 2013–2017. It is based on the figures for detentions at EU borders from all the Member States, but only on part of the data for detentions within the national markets (as for some Member States, including some of the larger ones – such as Germany, Poland and, in part, the United Kingdom – there was no data available for national markets detentions). It appears from this report that the volume of ‘fakes’ – defined as ‘tangible goods that infringe any kind of IP right’ detained in the EU between 2013 and 2017 was approximately 438 million items. This equates to one fake item detained per EU citizen aged 15 years and over. About 30–40 per cent of these were detained at EU borders, and the rest in national markets. The estimated value of these items amounted to some €12 billion, which is almost equivalent to the 2018 GDP of an EU Member State such as Malta. The four most common subcategories of detained products in terms of the number of items detained, accounting for more than 33 per cent of the products recorded, were clothing accessories, toys, recorded CDs/DVDs (music, film, software and video games) and cigarettes. In terms of estimated value of the items reported, the top four subcategories of products identified were clothing accessories, watches, recorded music, film, software and game software, and bags. These four subcategories represented almost 50 per cent of the estimated value of detentions during the period 2013–2017. Trademark infringement accounted for almost 70 per cent by volume of detentions at the EU borders and in the national markets. Between 2013 and 2017, the annual number of operations relating to the detentions of IPR-infringing goods by customs authorities at EU borders has gradually decreased following a peak in 2014. The same is true for the number of items detained and their estimated values, with the exception of a temporary increase in 2015 and 2016. The report’s Executive Summary claims that ‘despite the decrease, there was a sustainable increase in the efficiency of operations during the period, as shown by the indicators for the volume and value of items per case. These results are noteworthy in a context of increasing usage by counterfeiters of types of shipments “inefficient per se”’. The figures related to detentions within the Member State national markets between 2013 and 2017 21.06 show many similarities with those related to border detentions. In terms of volume, clothing, clothing accessories, toys and recorded CDs/DVDs were listed as the most detained items within the EU. Significant seizures of packaging material, labels, tags and stickers were also reported. For both volume and estimated value, the top five Member States accounted for approximately 97 per cent of total detentions in the domestic markets for the period analysed – Italy led the way, with 77 per cent of the detentions. The need to develop a legal framework to ensure the effective enforcement of IPRs – including 21.07 copyright and related rights – was acknowledged first at the international level, timidly at first until the adoption of the TRIPS Agreement (Section II). In the meantime, in 1986, the EU had laid the foundations of an innovative border measures system; only after the adoption of the TRIPS Agreement, to which it adhered alongside its Member States, did it contemplate the possibility of strengthening its legal arsenal and building up comprehensive policies to help combat IPR infringements (Section III). Remarkably enough, policies to tackle piracy were already designed in 1998, that is before any attempt had been made to harmonise in any way copyright and related rights law at the EU level. Over the next few years, the EU set up a number of effective overall enforcement tools aimed at fighting piracy in the internal market (Section IV) as well as in third

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EUIPO, Report on the EU Enforcement of Intellectual Property Rights: Results at EU Borders and in Member States 2013-2017, September 2019, .

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Chapter 21 THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY

countries (Section VI). With the advent of the internet, however, clashes between the protection of IPRs and other fundamental rights rapidly surfaced (Section V).

II. FROM THE BERNE CONVENTION TO THE WIPO INTERNET TREATIES 21.08 The Berne Convention for the Protection of Literary and Artistic Works of 9 September 1886 (as revised in Paris on 24 July 1971), which sets the basis for the international protection of copyright, only devotes a few words to the enforcement of such rights. It contains three paragraphs on the seizure of copies which infringe copyright,28 and adds that ‘the seizure shall take place in accordance with the legislation of each country’. Similarly, it states, in relation to infringements of the moral rights recognised by Article 6bis, that ‘the means of redress for safeguarding the rights granted by this Article shall be governed by the legislation of the country where protection is claimed’.29 21.09 The Universal Copyright Convention (UCC) of 6 September 1952 (as revised in Paris on 24 July 1971) does not go much further: it merely states that ‘each Contracting State undertakes to provide for the adequate and effective protection of the rights of authors and other copyright proprietors in literary, scientific and artistic works, including writings, musical, dramatic and cinematographic works, and paintings, engravings and sculpture’.30 21.10 The Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations of 26 October 1961 does not contain a single word about enforcement. 21.11 Ten years later, the Geneva Convention for the Protection of Producers of Phonograms against Unauthorised Duplication of Their Phonograms of 29 October 1971 limits itself to stating that: the means by which this Convention is implemented shall be a matter for the domestic law of each Contracting State and shall include one or more of the following: protection by means of the grant of a copyright or other specific right; protection by means of the law relating to unfair competition; protection by means of penal sanctions.31

21.12 By contrast, the TRIPS Agreement,32 which was agreed in 1994 at the end of the Uruguay Round of WTO negotiations, as a part of the General Agreement on Tariffs and Trade (GATT), contains a significant number of provisions about the enforcement of IPRs in general (Part III of the Agreement), in addition to a section setting up minimum protection standards for copyright and related rights, trademarks, geographical indications and appellations of origin, industrial designs, patents and plant variety rights, layout designs of integrated circuits and undisclosed information (Part II), a set of rules on the acquisition and maintenance of IPRs (Part IV) and on dispute prevention and settlement (Part V). Articles 42–49 deal with civil and administrative procedures and remedies pertaining to all types of IPR infringements (fair and equitable procedures, evidence, injunctions, damages, other remedies, right of information, compensation of defendants, and administrative procedures), whilst Article 50 is specifically dedicated to provisional measures. Minimum standards set by TRIPS also include criminal proceedings and border measures. As regards the latter, the WTO Members were inspired by the European Community’s Regulation 3842/86.33 However, whereas Regulation 3842/86 only dealt with trademark counterfeiting,

28 29 30 31 32 33

See Berne Convention, Art. 13(3) (regarding illicit copies of sound recordings) and Art. 16(1) and (2) (regarding illicit copies of any works enjoying legal protection under the Convention). Berne Convention, Art. 6bis(3). UCC, Art I. Geneva Convention, Art. 3. See n 5 above. Council Regulation (EEC) No 3842/86 of 1 December 1996 laying down measures to prohibit the release for free circulation of counterfeit goods [1987] OJ L357/1.

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Articles 51–60 of the TRIPS Agreement aim to combat both ‘counterfeit trademark goods’ and ‘pirated copyright goods’. As regards criminal measures, Article 61 of TRIPS also greatly exceeds the EU’s ambitions at the time the Agreement was adopted, in that it compels the WTO Members to adopt criminal law sanctions ‘at least in cases of wilful trademark counterfeiting or copyright piracy on a commercial scale’. The Agreement also makes disputes between WTO Members about the respect of the TRIPS obligations subject to the WTO’s dispute settlement procedures. Keeping a sense of proportion, the TRIPS Agreement represents a significant advance on the 21.13 preceding international treaties as far as enforcing copyright and related rights is concerned: the TRIPS Agreement lays down a veritable arsenal of civil, criminal, customs and administrative provisions, which greatly exceed the scope of the simple seizures that had been somewhat reluctantly included in the Berne Convention. From that perspective, the TRIPS Agreement clearly is a Berne-plus agreement. Its efficiency is linked to the multilateral dispute settlement mechanism associated with it, and to the fact that ratification of TRIPS is a compulsory requirement of WTO membership. The TRIPS Agreement has thus become the multilateral intellectual property treaty with the widest membership.34 Nowadays, TRIPS is still the only multilateral treaty with a comprehensive set of rules on 21.14 intellectual property enforcement. WIPO has been unable to do much better with its Copyright Treaty (WCT) and its Performances and Phonograms Treaty (WPPT) of 20 December 1996. The WIPO ‘Internet Treaties’, as they have come to be known, do nevertheless update the international protection for copyright and related rights, not least with regard to the so-called ‘digital agenda’, and improve the means to fight piracy world-wide, while preserving the rights and obligations laid down in the Berne35 and Rome Conventions.36 They mandate their Contracting Parties to adopt, ‘in accordance with their legal systems’, the measures necessary to ensure their application, and provide that ‘Contracting Parties shall ensure that enforcement procedures are available under their law so as to permit effective action against any act of infringement of rights covered by th(ese) Treat(ies), including expeditious remedies to prevent infringements and remedies which constitute a deterrent to further infringements.’37 Both treaties also contain provisions which prohibit so-called ‘anti-circumvention devices’ and the alteration or deletion of digital right management (DRM) information, thus enabling right holders to better protect their rights. To date, the WCT and the WPPT have 103 contracting parties. Both treaties have been signed by developing and developed countries coming from all regions of the world.38 Next to the WCT and the WPPT, only a few significant multilateral IPR agreements have been concluded; those include, for example, the Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired or Otherwise Print Disabled, and the Beijing Treaty on Audio-visual Performances. Regrettably, no recognised international forum (such as the WTO or WIPO) has so far managed to 21.15 design a system ensuring the effective enforcement of IPRs on the internet. In its 15th monitoring report on G20 Trade Measures, the WTO recalled that: at the time of the TRIPS negotiations, international trade in musical and audiovisual works, consumer software, and publications, was almost entirely conducted by means of tangible carrier media (such as discs and the printed page) that were transported physically across national borders, and could be counted and

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35 36 37 38

The TRIPS Agreement was approved on behalf of the European Community by Council Decision 94/800/EC of 22 December 1994 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the agreements reached in the Uruguay Round multilateral negotiations (1986–1994) [1994] OJ L336/1. WCT, Art. 1(2). WPPT, Art. 1(1). WCT, Art. 14; WPPT, Art. 23. Those treaties were ratified on 14 December 2009 by the EU, where they have been in force since 14 March 2010.

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Aside from the Anti-Counterfeiting Trade Agreement, which, as will be seen below, turned out to be a failure, the only plurilateral initiative in this area concerns the Council of Europe’s Convention of 23 November 2001 on Cybercrime (ETS No 185), which was drafted by the member countries of the Council of Europe, Canada, Japan, South Africa, and the United States and entered into force on 1 July 2004. The Cybercrime Convention obligates its signatories to establish as criminal offences under their domestic law the infringement of copyright or related rights, with the exception of infringements of moral rights, where such acts are committed wilfully, on a commercial scale, and by means of a computer system.40 Each party is, however, free not to impose criminal liability in limited circumstances, provided that other effective remedies are available and that such reservation does not derogate from its international obligations set forth in the aforesaid international instruments.41 Although a multilateral treaty specifically addressing IPR enforcement in the digital environment appears to be much needed, it has proved impossible so far to table any serious proposal aiming to tackle this issue.

III. THE AWAKENING OF THE EUROPEAN UNION TO THE PROBLEM OF PIRACY 1. Genesis and development of the EU policies and actions in the fight against piracy 21.16 Harmonising IPRs has consistently been considered as a way to effectively fight against counterfeiting and piracy, particularly at the EU borders.42 This explains why the action taken by the EU has long focused primarily on the harmonisation of national substantive laws and the creation of unitary rights at the EU level. In the field of industrial property, harmonisation of substantive laws has already been achieved to a significant extent.43 In addition, unitary protection titles, such as the European Union trademark,44 the Community design,45 Community plant variety rights,46 and geographical indications protected in the EU47 have been established, which are immediately valid

39 40 41 42 43

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WTO, Report on G20 Trade Measures of 26 June 2016, , fn 84 to para. 5.5. Convention on Cybercrime, Art. 10(1) and (2). Ibid., Art. 10(3). Council Resolution of 25 September 2008 on a Comprehensive European Anti-Counterfeiting and Anti-Piracy Plan [2008] OJ C253/1, para. 4. See Directive 89/104 on trademarks, codified by Directive 2008/95. From 15 January 2019, Directive 2008/95/EC has been repealed and replaced by Directive 2015/2436 on trademarks. In the field of design law, see Directive 98/71 on designs. In the area of patent law, see also Directive 98/44 on biotechnological inventions; Regulation 1768/92 on supplementary protection certificates for medicinal products, codified by Regulation 469/2009; Regulation 1610/96 on supplementary protection certificates for plant protection products. Regulation 40/94 on the Community trademark, codified by Regulation 207/2009, and then by Regulation 2017/1001 on the European Union trademark. Regulation 6/2002 on Community designs. Regulation 2100/94 on Community plant variety rights. Regulation 1601/1991 on aromatised wines, wine-based drinks and wine-product cocktails, replaced in the meantime by Regulation 251/2014 on the definition, description, presentation, labelling and the protection of geographical indications of aromatised wine products and repealing Council Regulation 1601/91; Regulation 1151/2012 on quality schemes for agricultural products and foodstuffs; Regulation 1234/2007 on a common organisation of agricultural markets and on specific provisions for certain agricultural products, replaced in the meantime by Regulation 1308/2013 establishing a common organisation of the markets in agricultural products and repealing Council Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007; Regulation 110/2008 on geographical indications of spirit drinks, replaced in the meantime by Regulation 2019/787, which will apply from 25 May 2021.

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and enforceable throughout the EU.48 The various pieces of legislation which govern these unitary rights mostly contain provisions on their judicial enforcement. Holders of such rights are thus entitled to obtain injunctions ordering the cessation of infringements across the whole EU. Litigation about infringements of European Union trademarks, Community designs and the Unitary Patents are (or, in the case of the latter, will be) handled by specialised courts,49 set up for this specific purpose, which are (or will be) empowered to issue EU-wide injunctions. By contrast, in the field of copyright and related rights, the harmonisation achieved by the EU thus far has remained limited to certain aspects.50 There are no such things as EU-wide copyrights or related rights. The scope of copyright and related rights is still defined to some extent by the national laws of the Member States.51 Consequently, as will be seen below and in other chapters of this book,52 the possibility of obtaining cross-border injunctions in relation to copyright or related rights infringement is limited. Right holders are reduced, in this area, to relying on the national laws of the Member States and on the provisions of EU Regulation 1215/2012.53 Finding itself unable to achieve an exhaustive harmonisation of the substantive law on copyright 21.17 and related rights across the EU, the European Commission identified for the first time in 1988 a set of ‘copyright issues requiring immediate action’.54 Piracy was one of them. It was not before 1998, however, that it seriously reflected on the means of strengthening the enforcement of copyright and related rights in the Member States. In a timid Resolution of 24 July 1984, the Council had previously advocated the adoption of measures to combat audiovisual pirating, but to no avail.55 The 1998 Green Paper ‘Combating Counterfeiting and Piracy in the Single Market’56 48

49 50

51 52 53

54 55

In the area of patent law, ‘European Patents’ granted by the European Patent Office (EPO) under the European Patent Convention (EPC) are not unitary titles, since, once delivered, they become a ‘bundle’ of national patents. The creation of an EU-wide patent has been on the EU agenda for years. The so-called ‘unitary patent’ was eventually established in 2012. The number of languages into which such patents should be translated has been the main obstacle to agreeing by unanimity on the creation of the unitary patent. The unitary patent is not, strictly speaking, an EU-wide patent. It was created under the ‘enhanced co-operation procedure’. Agreement was reached on its functioning between 25 of the then 27 EU Member States during the European Council of 28–29 June 2012. The necessary EU legislation was approved by the European Parliament on 11 December 2012, and entered into force in January 2013. Italy and Spain decided not to take part as a result of the proposed language scheme. Croatia subsequently acceded to the EU in July 2013. The unitary patent will become effective once the related Agreement on a Unified Patent Court ([2013] OJ C175/1), which was signed by all EU Member States except Croatia, Poland, and Spain, enters into force. The Unified Patent Court as regards the Unitary Patents; the national European Union trademark courts and Community design courts as regards respectively European Union trademarks and Community designs. See Directive 96/9 on databases (as modified by Directive 2019/790 on copyright and related rights in the Digital Single Market); Directive 93/83 on satellite broadcasting and cable retransmission; Directive 2001/29 on copyright and related rights (as modified by Directive 2019/790 on copyright and related rights in the Digital Single Market); Directive 2001/84 on the resale right; Directive 92/100 on rental right and lending right, codified by Directive 2006/115; Directive 93/98 on the term of protection of copyright and certain related rights, codified by Directive 2006/116; Directive 91/250 on computer programs, codified by Directive 2009/24. On this subject, see chapter 1 of this book. See below, paras. 21.59–21.61, and chapter 24. Regulation 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Recast) [2012] L351/1, replacing, from 1 January 2015, Council Regulation 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters [2001] OJ L12/1. Green Paper on Copyright and the Challenge of Technology – Copyright Issues Requiring Immediate Action, COM(88) 172 final. Resolution of the representatives of the Governments of the Member States on measures to combat audio-visual pirating [1984] OJ C204/1. In this Resolution, the Member States recognised that ‘the phenomenon of pirating has become more and more widespread’, and that ‘this may be partly attributed to the lack of procedures and penalties which can be effectively applied to pirates and traders in copied material’. They agreed: to the examination, in the context of current discussions on copyright and in the appropriate framework, of any proposal of a contractual, legislative or other nature which could help to provide an adequate solution to the problems, and in particular any possibility of improving the effectiveness of the procedures and penalties applicable to pirates and traders in copied material.

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See n 11 above.

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formed the foundation of what was going to become a global European legal framework for the enforcement of IPRs. It was followed by an ambitious Action Plan on 30 November 2000,57 which laid the foundations for Directive 2004/48/EC on the enforcement of intellectual property rights58 and a ‘Strategy for the Enforcement of Intellectual Property Rights in Third Countries’.59 21.18 Ever since the publication of the 1988 and 1998 Green Papers, the EU institutions have repeatedly expressed concern regarding the seriousness and growth of counterfeiting and piracy. They have pointed out its bad effect on the competitiveness of the EU and the health of businesses, creative forces and consumers in the EU. They have also emphasised the importance of protecting IPRs as fundamental to promoting culture and diversity and benefiting fully from the creative activity of EU citizens and businesses.60 EU policy on copyright and related rights over recent decades has consistently relied on the assumption that piracy in cultural and creative goods is damaging the legal marketing of the media, hampering the development of competitive models for the legal supply of cultural and creative content, calling into question the adequate remuneration of right holders, and is holding back the dynamism of the European cultural sector, which provides access to legal, diverse and high-quality cultural goods and services.61 In today’s knowledge-based society, copyright and related rights play an increasingly important role, fostering economic growth by protecting and enabling artists and designers to benefit from the commercial value of their creations.62 The EU policy on the enforcement of copyright and related rights is, to that extent, in line with the InfoSoc Directive,63 whose Recital 9 emphasises that copyright and related rights are ‘crucial to intellectual creation’ and that ‘their protection helps to ensure the maintenance and development of creativity in the interests of authors, performers, producers, consumers, culture, industry and the public at large’. 21.19 The creation at EU level of a customs union and the internal market (also known as the Single Market), characterised by the principle of free movement of goods and services, went hand-in-hand, naturally, with a reinforcement of the protection of the EU’s external borders, in an attempt to counter imports of goods which infringe IPRs. The foundations for this border measure regime were laid from 1986 onwards, starting with a Regulation to fight against the importing into the Member States of counterfeit goods which infringed trademarks.64 In 1994, with the signing of the TRIPS Agreement, this arsenal was reinforced in an attempt to prevent the import of goods which infringed copyright and related rights.65 The scope of this regime of customs enforcement was,

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‘Communication from the Commission to the Council, the European Parliament and the European Economic and Social Committee – Follow-up to the Green Paper on Combating Counterfeiting and Piracy in the Single Market’, COM(2000) 789 final. Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004 on the enforcement of intellectual property rights [2004] OJ L157/45. [2005] OJ C129/3. See, inter alia, the Communication from the Commission to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions on Creative online content in the Single Market, COM(2007) 836 final, 8; Council Resolution of 25 September 2008 (n 42 above), para. 11; Council Resolution 2010/C 56/01 of 1 March 2010 on the Enforcement of Intellectual Property Rights in the Internal Market [2010] OJ C56/1, para. 16. Council Resolution of 1 March 2010 (n 60 above), para. 19. Commission Communication of 11 September 2009, 3. Directive 2001/29 on copyright and related rights. Regulation 3842/86. Council Regulation (EC) No 3295/94 laying down measures to prohibit the release for free circulation, export, re-export or entry for a suspensive procedure of counterfeit and pirated goods [1994] OJ L341/8.

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again, further extended, in 1999,66 2003,67 and 2013,68 in an attempt to protect other IPRs recognised in the EU or in individual Member States. The adoption on 29 April 2004 of Directive 2004/48/EC on the enforcement of intellectual 21.20 property rights (‘the Enforcement Directive’ or ‘IPRED’) was the first attempt by the EU to harmonise horizontally and structurally civil-law legislation aiming to enforce IPRs. The objective was to guarantee that IPRs enjoy an equivalent level of protection throughout the EU, while surpassing the standards required by the TRIPS Agreement. However, the Commission recognised that the efficient protection of innovation and creativity in 21.21 the internal market could not be guaranteed solely by concentrating on piracy and counterfeiting unfolding inside the EU or at its external borders, and so it also launched, one year later, its ‘Strategy for the Enforcement of Intellectual Property Rights in Third Countries’.69 On 11 October 2005, the Commission adopted an action plan containing a package of customs- 21.22 related measures to strengthen protection for the EU and its citizens against counterfeiting and piracy.70 In May 2008, a high-level conference on counterfeiting and piracy was organised by the Commis- 21.23 sion and the European Parliament to launch a sustainable EU strategy for a more participative approach.71 On 16 July 2008, the Commission published its ‘Communication on a New Industrial Property Rights Strategy for Europe’,72 which urged all the players involved to intensify the fight against counterfeiting and piracy. This was followed, two months later, by the adoption of a Council Resolution on a Comprehensive European Anti-Counterfeiting and Anti-Piracy Plan,73 which advocated further actions to enforce IPRs in third countries, through regular surveys, through bilateral agreements, and through closer cooperation and regular dialogues with third-party states. In this Resolution, the Council invited the Commission to set up ‘a European counterfeiting and piracy observatory’, to submit an anti-counterfeiting Customs Plan for the years 2009–12, to evaluate the improvements needed to be made to the legal framework on customs enforcement of IPRs, to submit appropriate proposals to encourage public–private partnerships to combat counterfeiting and piracy, and to recommend best practices, ‘especially as regards Internet sales’.74 The anti-counterfeiting Customs Plan for 2009–12, developed by the Commission in close cooperation with the Member States, was published on 16 March 2009.75 Three sets of Conclusions adopted by the Council in 2008–09 provide additional recommendations, 21.24 specifically in relation to the digital environment: the Conclusions of 22 May 2008 on a European approach to media literacy in the digital environment,76 the Conclusions of 20 November 2008 on

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Council Regulation (EC) No 241/1999 of 25 January 1999 amending Council Regulation (EC) No 3295/94 laying down measures to prohibit the release for free circulation, export, re-export or entry for a suspensive procedure of counterfeit and pirated goods [1999] OJ L27/1. Regulation (EC) No 1383/2003 concerning customs action against goods suspected of infringing certain intellectual property rights and the measures to be taken against goods found to have infringed such rights [2003] OJ L196/7. Regulation 608/2013, see n 7 above. See n 59 above. Communication of the Commission to the Council, the European Parliament and the European Economic and Social Committee on a Customs Response to Latest Trends in Counterfeiting and Piracy, COM(2005) 479 final. Press release IP/08/652, . COM(2008) 465 final. See n 42 above. Ibid., paras. 15–16. Council Resolution of 16 March 2009 on the EU Customs Action Plan to combat IPR infringements for the years 2009 to 2012 [2009] OJ C71/1. [2008] OJ C140/8.

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the development of legal offers of online cultural and creative content and the prevention and combating of piracy in the digital environment,77 and the Conclusions of 27 November 2009 on media literacy in the digital environment.78 The Council stresses the importance of developing new competitive business models which can enlarge the legal offer of cultural and creative content, while at the same time preventing and combating piracy so as to foster economic growth, employment, and cultural diversity. The Council further points out that online piracy was reaching a critical threshold in some cultural and creative sectors and was likely to do lasting harm to the appropriate remuneration of the owners of copyrights and related rights. Besides its consequences for the marketing of traditional media (CDs, DVDs, etc.) it is a major obstacle to the development of the legal provision of cultural and creative content online, on which, to a large extent, the dynamism of the European cultural and creative content sectors depend, and threatens cultural creativity and diversity. 21.25 Meanwhile, on 26 March 2009, the European Parliament adopted a Recommendation which strengthened security and fundamental freedoms on the internet,79 urging the Council to preserve full and safe access to the internet while encouraging public–private cooperation in enhancing law enforcement. Concurrently, in its Communication of 11 September 2009, the Commission emphasised that the internet had become an important vehicle for the sale of fake goods worldwide. ‘Its global reach and accessibility, the possibility for traders to remain anonymous and for offers to be placed and withdrawn instantly has made it one of the most attractive tools for the sale of counterfeit goods. The enormous growth of the phenomenon makes this an area for priority action.’80 21.26 On 29 June 2009, the Commission’s ‘Recommendation on Measures to Improve the Functioning of the Single Market’81 was published. It invited the Member States to develop, inter alia, a systematic approach for monitoring and evaluating national legislation which implemented internal market rules – thus implicitly including the InfoSoc Directive82 – to identify any inconsistencies, including those arising from consultation with stakeholders and feedback from existing problem-solving mechanisms, etc. The Commission’s Recommendation was supported by the Council in its Conclusions of 24 September 2009 entitled ‘Making the Internal Market work better’, which identified three priority areas for improving the internal market, enforcement of intellectual property rights being one of them.83 21.27 Neither the Commission’s Recommendation nor the Council’s Conclusions explicitly touched upon the issue of counterfeiting and piracy. However, on 11 September 2009, finally prepared to ‘turn a long-term commitment into action’, the Commission released its Communication on ‘Enhancing the Enforcement of Intellectual Property Rights in the Internal Market’,84 which stressed the importance of agreements for administrative cooperation between public authorities and memoranda of understanding between stakeholders, and supported the creation of a European Observatory on Counterfeiting and Piracy as the principal EU instrument to ‘enable regular assessments, on the basis of the data which the public and private sectors wish to provide, of the extent of counterfeiting and piracy and a more precise analysis of these phenomena’.85 This Communication

77 78 79 80 81 82 83 84 85

[2008] OJ C319/15. [2009] OJ C311/12. European Parliament Recommendation 2009/524/EC of 26 March 2009 to the Council on strengthening security and fundamental freedoms on the Internet (2008/2160(INI)) [2010] OJ C117 E/206. Commission Communication of 11 September 2009, 10. [2009] OJ L176/17. See n 63 above. Council document 13024/09. COM(2009) 467 final. Ibid., referring to Council Resolution of 25 September 2008 (n 42 above), 15.

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was followed by a Council Resolution of 1 March 2010 ‘on the enforcement of intellectual property rights in the internal market’.86 In this Resolution, the Council called upon the Member States to develop national anti-counterfeiting and anti-piracy strategies and to establish transparent coordination structures in this field,87 and encouraged the Member States, the Commission, and stakeholders to analyse and implement effective awareness campaigns.88 The need to make all players, including consumers and professionals, aware of the consequences for the creative and cultural sectors if copyright and related rights were not upheld, as well as the need to improve information on the conditions for the use of copyright material on various platforms, using various types of equipment, and on the restrictions to the use of technical measures to protect and manage rights, had already been repeatedly stressed by the Council, inter alia, in its Conclusions of 20 November 2008.89 In a Resolution of 12 May 2011 on unlocking the potential of cultural and creative industries,90 the 21.28 European Parliament called on the Commission to take into account the specific problems encountered by small- and medium-sized enterprises (‘SMEs’) when attempting to assert their IPRs and to promote best practice and effective methods to enforce these rights. On 24 May 2011, the Commission recalled the need to foster public awareness campaigns, to strengthen the existing legislative framework for IPR enforcement (inter alia, through a revision of the IPRED), and to supplement this by voluntary arrangements between stakeholders. It also emphasised that the EU should ratify the Anti-Counterfeiting Trade Agreement (ACTA).91 Between 2012 and 2014, the Commission designed a comprehensive approach to enhance IPR 21.29 enforcement, in the EU and beyond, the overall aim of which was ‘to stimulate growth and employment and reduce the incentives for the many commercial-scale infringers that undermine the EU economy’.92 This strategy was enshrined in a Customs Action Plan,93 that went hand-in-hand with another Action Plan against IPR infringements and a new Strategy for the protection and enforcement of IPRs in third countries, set out in two Communications adopted by the European Commission on 1 July 2014. The 2014 Action Plan against IPR infringements is a comprehensive response to the economic harm resulting from commercial-scale infringements and focuses on what can be done to strengthen respect for IPRs within the EU.94 As for the new IPR Strategy, it sets out the lines of action for enhancing IPR standards and stemming the trade of IPR-infringing goods in

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[2010] OJ C56/1. Ibid., para. 26. Ibid., para. 28. See n 77 above. European Parliament Resolution 2010/2156(INI) of 12 May 2011 on unlocking the potential of cultural and creative industries [2012] OJ C377 E/142. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions ‘A Single Market for Intellectual Property Rights. Boosting Creativity and Innovation to Provide Economic Growth, High Quality Jobs and First Class Products and Services in Europe’, COM(2011) 287 final. On ACTA, see paras. 15.208 ff. European Commission, ‘Enforcement of Intellectual Property Rights – Frequently Asked Questions’, MEMO/14/449 (1 July 2014). See para. 21.85 below. Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee ‘Towards a renewed consensus on the enforcement of Intellectual Property Rights: An EU Action Plan’, COM(2014) 392 final. See also, in this regard, the Council Conclusions of 4–5 December 2014 on IPR enforcement (), in which the Council stressed its commitment in the fight against IPR infringements ‘while safeguarding the fundamental rights of all parties concerned by IPR enforcement’, and took note of the Commission’s focus on commercial-scale infringements and the ‘Follow the money’ strategy.

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third countries.95 In addition to these non-binding initiatives, the Commission has not ruled out legislative action in this field in the future. 21.30 The March 2014 European Council reaffirmed the importance of IPRs as a key driver for growth and innovation and highlighted the need to fight against counterfeiting and piracy to enhance the EU’s industrial competitiveness globally.96 In the fall of 2017, the Commission adopted a comprehensive package of measures to further improve the application and enforcement of IPRs within the EU Member States, at EU borders and internationally. Amongst initiatives to support industry-led initiatives to combat IPR infringements (such as voluntary agreements with intermediaries and steps to better protect supply chains against counterfeiting) and to strengthen efforts to fight IPR infringements at a global scale by promoting best practices and stepping up cooperation with third countries, the Communication of 29 November 2017, entitled ‘A balanced IP enforcement system responding to today’s societal challenges’,97 which is part of this package, mentions that the Commission will offer a more targeted assistance to national customs authorities. 21.31 In December 2018, considering that marketplaces remain the chief distribution channels for IPR-infringing goods in the EU, the Commission published a Counterfeit and Piracy Watch List.98 This non-exhaustive list, which stems from public consultation processes, identifies online and physical marketplaces situated outside the EU that are reported to engage in, or facilitate, substantial IPR infringements, and in particular counterfeiting and piracy, focusing on e-commerce platforms, websites providing copyright-protected content, physical marketplaces, and online pharmacies. The Watch List, which the Commission is planning to update on a regular basis, is intended to encourage governments, local law enforcement and operators to take action and raise awareness among EU citizens of the risks of purchasing from these marketplaces. To further step up the fight against IPR infringements in non-EU countries, the Commission has also published a number of reports on the protection and enforcement of IPRs in third countries and implemented technical cooperation programmes with China and some other non-EU countries, inter alia, in South Asia and Latin America. 21.32 Last but not least, the adoption, on 17 April 2019, of the DSM Directive, which imposes greater accountability on online content sharing service providers, represents a major breakthrough in the fight against the illegal up- and downloading of copyright protected materials. The process which led to this new legal instrument was a lengthy one. It finds its roots in the adoption by the European Commission, on 18 December 2012, of seven new priorities for the digital economy and society in 2013–14.99 One of them concerned the modernisation of the EU copyright legislative framework with a view to guaranteeing effective recognition and remuneration of right holders and to combating illegal offers and piracy while opening up greater access and a wider choice of legal offers to end users. This was definitely a welcome development, as the actions and policies – both in the EU and abroad – to fight against illegal up- and downloading of copyright material had, so far, been very scarce. The Commission has agreed on two parallel tracks of action. First, a structured

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Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee ‘Trade, growth and intellectual property – Strategy for the protection and enforcement of intellectual property rights in third countries’, COM(2014) 389 final. See also the Commission Staff Working Document ‘Trade, growth and intellectual property’ accompanying this Communication, SWD(2014) 204 final. European Council Conclusions 20–21.03.2014, paras 5–6. Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee ‘A balanced IP enforcement system responding to today’s societal challenges’, COM(2017) 707. . ‘Digital “to-do” list: new digital priorities for 2013–2014’, Press Release IP/12/1389, 18.12.2012, . See also the Commission’s Communication of the same day on Content in the Digital Single Market, COM(2012) 789 final, and the related Press Release IP/12/1393, .

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stakeholder dialogue was launched in 2013 to explore the potential and limits of innovative licensing and technological solutions in making EU copyright law and practice fit for the digital age. On 5 December 2013, the Commission launched a public consultation on the reform of EU copyright law, including ‘how to improve the effectiveness and efficiency of enforcement while underpinning its legitimacy in the wider context of copyright reform’.100 The decision-making process was finally initiated in 2014. The reform of EU copyright law was a huge challenge. Who could have predicted that the 21.33 Commission would manage to persuade the civil society, represented by the European Parliament, of the importance of adopting higher standards to fight against copyright infringements, especially in the digital environment, whereas it has failed to convince it of the need to adopt ACTA, which did not exceed the standards set forth in the IPRED as it stands now?

2. The EU approach to the fight against piracy in a nutshell The strategy designed by the EU over the last 20 years to fight against infringements of copyright 21.34 and related rights is based on two key areas. The first seeks to fight piracy within the internal market, as well as at the external borders of the EU so as to stop, as much as possible, the daily influx of pirated goods via existing commercial channels in the Member States. The second seeks to stop piracy at the source by reinforcing existing protection for works covered by copyright and related rights and by improving the efficacy of the fight against infringements of these rights in third countries. In both of these areas, the EU has created a legislative arsenal (hard law) backed up by non-legislative measures (soft law). The eradication of piracy in the digital environment is a third area that is being carefully looked at nowadays. The EU legislative instruments adopted to combat infringements of copyright and related rights, as 21.35 they stand today, consist primarily of: Directive 2001/29/EC101 (the InfoSoc Directive) and Directive 2019/790 (the DSM Directive), Regulation (EU) 608/2013102 (the Border Measures Regulation), and Directive 2004/48/EC103 (the Enforcement Directive or IPRED). All of them are valuable tools with a view to impeding the flows of pirated goods produced in the internal market or entering the EU Customs territory. However, unlike the case with Regulation 608/2013, the ambit of the above Directives is not limited to the fight against illicit ‘physical goods’; they are all relevant – to various degrees – when it comes to tackling internet piracy too. Directive 2000/31/EC104 (the E-Commerce Directive) constitutes a useful complement specifically in the area of information society services. It will therefore be discussed in the section dealing with enforcement issues in the digital environment.105 Regulation 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters106 (the Brussels I bis Regulation) also contributes to the edifice. Although a few provisions on enforcement can also be found in Directive 2009/24 on computer programs,107 their added value with regard to the existing international and EU legal frameworks is limited. Moreover, since the Computer Program Directive is lex specialis in relation to

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See Press Release IP/13/1213(5.12.2013), . See n 63 above. See n 7 above. See n 58 above. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (Directive on electronic commerce) [2000] OJ L178/1. See Section IV. See n 53 above. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs (codified version) [2009] OJ L111/16.

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the InfoSoc Directive,108 its scope is relatively narrow. Therefore, this Directive will not be addressed in this contribution.109

IV. THE FIGHT AGAINST PIRACY IN THE INTERNAL MARKET AND AT THE EU’S EXTERNAL BORDERS 1. Legislative Actions A. Civil enforcement of copyright and related rights i.

The InfoSoc Directive110

21.36 The InfoSoc Directive harmonises certain aspects of copyright and related rights in the information society. It defines the scope of the acts covered by the reproduction right with regard to the different beneficiaries.111 It also harmonises the author’s right of communication to the public, which includes any transmission or retransmission of a work to the public by wire or wireless means, including broadcasting.112 Copyright protection under the Directive further includes the exclusive right to control distribution of the work incorporated in a tangible article.113 The preamble emphasises that ‘[t]he objective of proper support for the dissemination of culture must not be achieved by sacrificing strict protection of rights or by tolerating illegal forms of distribution of counterfeited or pirated works’.114 The Directive further stresses that a fair balance of rights and interests between the different categories of right holders and users of protected subject matter must be safeguarded.115 With this goal in mind, it provides for an exhaustive enumeration of exceptions and limitations to the reproduction right and the right of communication to the public which may be set out by the Member States.116 21.37 Articles 6 and 7 of the Directive require the Member States to provide protection to digital rights management information (DRMs), as well as to effective technological measures (TPMs) that are used by authors, performers or producers of phonograms in connection with the exercise of their rights in, and that restrict acts in respect of, their works, performances, and phonograms, which are not authorised by the authors, the performers or the producers of phonograms concerned or permitted by law. Those provisions ‘implement’ Articles 11 and 12 of the WCT and 18 and 19 of the WPPT. 21.38 Article 8 stipulates that Member States must provide appropriate sanctions and remedies in respect of infringements of the rights and obligations set out in the Directive and must take all the measures necessary to ensure that those sanctions and remedies are applied. The sanctions thus provided for must be effective, proportionate, and dissuasive.117 It should be noted, in this regard, that the Directive applies indistinctly to online and offline infringements. Moreover, the Member States are required to take the measures necessary to ensure that right holders whose interests are affected by an infringing activity carried out on their territory can bring an action for damages and/or apply for

108 109 110 111 112 113 114 115 116 117

CJEU, case C-128/11, UsedSoft GmbH v. Oracle International Corp., 3 July 2012, ECLI:EU:C:2012:407, para. 51. We refer the readers to the chapter of this book dedicated to the Computer Program Directive. The InfoSoc Directive is analysed in more detail in a separate chapter of this book. InfoSoc Directive, Art. 2. Ibid., Art. 3. Ibid., Art. 4. Ibid., Recital 22. Ibid., Recital 31. Ibid., Art. 5. Ibid., Art. 8(1).

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an injunction and, where appropriate, for the seizure of infringing material as well as of circumvention devices.118 Last but not least, Article 8(3) of the Directive mandates the Member States to ensure that right holders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe a copyright or related right, irrespective of whether or not they acted in good faith. The InfoSoc Directive leaves the conditions and modalities relating to such injunctions to the national laws of the Member States.119 Article 8(3) is a key provision in the fight against copyright and related rights infringements in the 21.39 EU. Indeed, while piracy is often a clandestine activity, traffickers, to be able to perpetrate their crimes, must rely on a great number of service providers, who are more easily identifiable. Europol and the EUIPO report that the main facilitators and enablers of pirates and counterfeiters include: internet service providers (ISPs); payment processors; advertising companies; search engines; freight forwarding and courier service companies; storage facilities; free trade zone operators; and brokers/ agents.120 Some of them cannot reasonably deny that they are aware that their customers are involved in illicit trade. Thus, for example, many traffickers of pirated goods try to hide the real origin of the goods, and thus to deceive Customs officials who use ‘country of origin’ as a key risk indicator in detecting counterfeit and pirated goods, by interrupting the journey of the shipments in neutral areas – such as Customs free zones121 – and by relying on ‘breaking bulk’ techniques.122 This technique has been borrowed from drug smuggling and aims to get around Customs’ vigilance because the goods appear to have come from a low-risk country.123 In such circumstances, or whenever he is being asked to load the goods in suspicious places, the transporter ought to wonder whether his customers are involved in illegal activity. Depending on the scenarios, service providers acting in bad faith could be held liable for direct copyright and/or related rights infringement, or at least, in those Member States where national law so provides, for indirect (or ‘contributory’) infringement. Their liability as tortfeasors under civil law, or under unfair competition law, might also be engaged.124 In some, if not most, of the cases, however, intermediaries provide services to infringers in good faith. Article 8(3) of the Directive remains applicable in such cases. This is what makes this provision so valuable. Intermediaries are indeed easier to identify than the actual

118 119 120

121

122 123 124

Ibid., Art. 8(2). Ibid., Recital 59. Europol & EUIPO, 2015 Situation Report on Counterfeiting in the European Union, (accessed 1 January 2020), p. 50. For an update, see 2017 Situation Report on Counterfeiting and Piracy in the European Union, . While free trade zones provide useful services to the legitimate industry, they are being misused by industrial-scale IPR-infringers to produce and distribute counterfeit and pirated goods. A study published in 2018 by the OECD and EUIPO confirms the links between free zones and counterfeiting and piracy. It shows that the existence, number and size of free zones correlate with increases in the value of counterfeit and pirated goods exported by that country. See OECD and EUIPO, Trade in Counterfeit Goods and Free Trade Zones (2018), https://ec.europa.eu/ohimportal/en/web/ observatory/trade-in-counterfeit-goods-and-free-trade-zones. See also OECD, Governance Frameworks to Counter Illicit Trade, 1 March 2018 (), which tables a number of proposals to eliminate criminal activities related to illicit trade that are carried out in free trade zones. The OECD’s Recommendation on Countering Illicit Trade: Enhancing Transparency in Free Trade Zones () adopted on 21 October 2019, proposes measures to enhance transparency in FTZs in order to prevent criminal organisations from taking advantage of them. With that goal in mind, the Recommendation calls on OECD Members and non-Members to ensure adequate levels of control and oversight of FTZs and to encourage their operators to comply with a Code of Conduct which forms part of the Recommendation. For an example of such practices in relation to parallel imports of medicines, see UK Court of Appeal, 8PM Chemist Ltd. v. Eli Lilly Co and Anor [2008] EWCA Civ 24. See the Communication from the Commission of 11 October 2005 on a Customs Response to the Latest Trends in Counterfeiting and Piracy (n 70 above). See, on this subject, L. Pechan and M. Schneider, ‘Carriers and trade mark infringements: should carriers care?’, (2010) JIPLP, 5, 350.

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infringer, and are often better placed to prevent counterfeiting and piracy. In recent years, IPR holders have, therefore, concentrated their enforcement efforts on such intermediaries – who may be carriers or express couriers, but also owners of warehouses125 or manufacturing plants. In the digital environment, litigation has increasingly targeted ISPs, hosting service providers, domainname registrars, search engines, online auction sites, and financial service providers.126 ii.

The IPRED

21.40 The IPRED is one of the pillars of the legal framework on the enforcement of IPRs within the internal market. It will be analysed in detail in a separate chapter of this book.127 We will therefore limit ourselves here to a few key considerations on the ambitions and scope of the Directive, as well as on the main shortcomings which have been revealed by its implementation in the Member States. 21.41 The IPRED aims to impose minimum standards on the Member States in terms of civil enforcement of IPRs; the Member States remain free to choose whether or not to consolidate this arsenal by adopting additional measures. The Directive applies to any infringement of IPRs, whether these rights were provided by EU law or by the law of the Member States.128 The following titles at least are deemed to be covered by the Directive: copyright, rights related to copyright, sui generis rights of database makers, rights of the creator of topographies of a semiconductor product, trademark rights, design rights, patent rights (including rights derived from SPCs), geographical indications, utility models, plant variety rights, and trade names (insofar as these are protected as exclusive property rights in the national law concerned).129 However, Recital 13 provides that the Member States are free to extend the provisions of the Directive to include acts involving unfair competition, including parasitic copies, or similar activities. The IPRED only applies to trade secrets insofar as its scope does not overlap with that of the Trade Secrets Directive.130 21.42 The Directive does not affect substantive law on intellectual property.131 It is without prejudice to the exceptions contained in EU legislation concerning copyright and related rights.132 Neither does it affect Member States’ provisions on criminal law and their international obligations (including those under the TRIPS Agreement),133 the General Data Protection Regulation, and the E-Commerce Directive.134 21.43 The IPRED is a ‘TRIPS plus’ instrument, in that it goes beyond the principles enshrined in the TRIPS Agreement in many respects.

125 126 127 128 129 130

Cf. O. O’Byrne and R. Burstall, ‘Liability of landlords for infringing activities’, (2011) JIPLP, 6, 738; and CJEU, Case C-379/14 Top Logistics & Van Caem International v. Bacardi, ECLI:EU:C:2015:497, judgment of 16 July 2015. See further below, Section V, in this regard. Cf. Ch. 12. IPRED, Art. 2(1). Statement by the Commission concerning Art. 2 of Directive 2004/48/EC of the European Parliament and of the Council on the enforcement of intellectual property rights [2005] OJ L194/37. Directive (EU) 2016/943 of the European Parliament and of the Council of 8 June 2016 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure [2016] OJ L157/1. Recital 39 states that: This Directive should not affect the application of any other relevant law in other areas, including intellectual property rights and the law of contract. However, where the scope of application of Directive 2004/48/EC of the European Parliament and of the Council and the scope of this Directive overlap, this Directive takes precedence as lex specialis.

131 132 133 134

IPRED, Recital 15. Ibid., Recital 16; Art. 2(1). Ibid., Recital 5; Art. 2(3). Ibid., Recital 15; Art. 2(3).

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Article 3 of the Directive mandates the Member States to provide for the measures, procedures and 21.44 remedies necessary to ensure the enforcement of IPRs. Those measures, procedures and remedies must be fair and equitable, and must not be unnecessarily complicated or costly, or entail unreasonable time limits or unwarranted delays.135 They must also be effective, proportionate and dissuasive, and must be applied in such a manner as to avoid the creation of barriers to legitimate trade and to provide for safeguards against their abuse.136 Specifically in relation to copyright, Article 5 of the Directive lays down a presumption of 21.45 authorship or copyright ownership in favour of those whose name appears on the work ‘in the usual manner’. A similar presumption also applies to holders of rights related to copyright. Although these presumptions are only valid in the absence of proof to the contrary, they have proved to be extremely valuable in the fight against piracy, in order to prevent infringers from raising artificial defences relying on the alleged lack of entitlement of the claimant to institute infringement proceedings based on copyright or related rights. Article 6(1) states that on application by a party who has presented reasonably available evidence 21.46 sufficient to support his or her claims, and has, in substantiating those claims, specified evidence which lies in the control of the opposing party, the competent judicial authorities may order that such evidence be presented by the opposing party, subject to the protection of confidential information. Article 6(2) provides that, in the case of an infringement committed on a commercial scale, the disclosure of banking, financial, or commercial documents under the control of the opposing party, subject to the protection of confidential information, may be ordered. ‘Commercial scale’ refers to acts ‘carried out for direct or indirect economic or commercial advantage’. It ‘would normally exclude acts carried out by end-consumers acting in good faith’.137 While orders requiring an alleged infringer to disclose samples and documents are necessary to 21.47 ensure proper enforcement of IPRs, the reality is that many infringers can close down their operations at short notice and are likely to destroy evidence before it can be disclosed. This is particularly true in the internet environment, as digital evidence is particularly vulnerable to quick deletion, obfuscation, or destruction. Provisional measures are needed to address these risks, by enabling right holders to secure evidence before it can be destroyed or dissipated. Therefore, Article 7(1) of the Directive provides that the Member States must ensure that their judicial authorities are empowered, even before the commencement of proceedings on the merits of the case, to order prompt and effective provisional measures to preserve relevant evidence, subject to the protection of confidential information. Such measures may include a ‘search’ or a ‘seizure’ of the infringing goods and, in appropriate cases, of materials and implements used in the production and/or distribution of these goods and the documents relating thereto. Where necessary, these measures may be taken inaudita altera parte. Article 8 enables the right holders to obtain information about the persons involved in the 21.48 infringing activities, as well as information about the price and quantities of the goods. It requires the Member States to make sure that: in the context of proceedings concerning an infringement of an intellectual property right and in response to a justified and proportionate request of the claimant, the competent judicial authorities may order that information on the origin and distribution networks of the goods or services which infringe an intellectual property right be provided by the infringer and/or any other person

135 136 137

Ibid., Art. 3(1). Ibid., Art. 3(2). Ibid., Recital 14.

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on certain conditions. It is clear from Article 8 that only judicial authorities can order the disclosure of information.138 Unlike Article 47 of the TRIPS Agreement, Article 8 of the IPRED is not only directed towards the infringers, but also towards: any other person who: (a) was found in possession of the infringing goods on a commercial scale; (b) was found to be using the infringing services on a commercial scale; (c) was found to be providing on a commercial scale services used in infringing activities; or (d) was indicated by the person referred to in point (a), (b) or (c) as being involved in the production, manufacture or distribution of the goods or the provision of services.

Article 8 is without prejudice to other statutory provisions which grant the right holder the right to receive fuller information.139 It is also without prejudice to statutory provisions governing the protection of information sources or the processing of personal data. By a judgment of 16 July 2015, however, the Court of Justice of the European Union (CJEU) specified that Article 8(3)(e) of the IPRED had to be interpreted as precluding a national provision which allows, in an unlimited and unconditional manner, a banking institution to invoke banking secrecy in order to refuse to provide, pursuant to Article 8(1)(c) of the Directive, information concerning the name and address of an account holder.140 21.49 As regards injunctive relief, the IPRED distinguishes between interlocutory injunctions (Art. 9(1)(a)) and permanent injunctions (Art. 11). The former are aimed at preventing an imminent infringement or forbidding the continuation of an alleged infringement, or to make such continuation subject to the lodging of guarantees pending the proceedings on the merits of the case; by contrast, the latter are issued at the outcome of the proceedings on the merits of the case, i.e., after the determination of the infringement. Both types of injunctions are available towards infringers and towards intermediaries whose services are being used by a third party to infringe an IPR. Concerning the scope of permanent injunctions granted towards the operator of an online marketplace under Article 11 of the Directive (or the corresponding national implementation provisions), the CJEU has held that this provision had to be interpreted as requiring the Member States to ensure that the national courts with jurisdiction in relation to the protection of IPRs are able to order that operator to take measures which contribute, not only to bringing to an end specific infringements of those rights by users of that marketplace, but also to preventing further infringements of that kind. Those injunctions must be effective, proportionate, and dissuasive and must not create barriers to legitimate trade.141 In Cases C-70/10 Scarlet Extended v. SABAM142 and C-360/10 Netlog v. SABAM,143 the CJEU came to the same conclusion regarding ISPs and hosting service providers.

138

139 140 141 142 143

Art. 8 is thus in line, in this respect, with the opinion of the European Data Protection Supervisor (EDPS) of 24 April 2012 on ACTA (‘Opinion on the proposal for a Council Decision on the Conclusion of the Anti-Counterfeiting Trade Agreement between the European Union and its Member States, Australia, Canada, Japan, the Republic of Korea, the United Mexican States, the Kingdom of Morocco, New Zealand, the Republic of Singapore, the Swiss Confederation and the United States of America’, ), para. 46, where the EDPS stresses that ‘[t]he involvement of judicial authorities is an essential part of the current EU system and crucial to ensure that enforcement takes place in respect of due process and fundamental rights’. Still according to the EDPS, administrative bodies are not ‘subject to all the guarantees of independence, impartiality and respect of the rights to the presumption of innocence and to a fair trial imposed upon judicial bodies’ (ibid., para. 47). Ibid., Art. 8(3)(a). See also, in this regard, the Opinion of Advocate General Saugmandsgaard Øe of 2 April 2020 in Case C-264/19, Constantin Film Verleih GmbH v. YouTube LLC and Google Inc., ECLI:EU:C:2020:261, paras 60–61. CJEU, Case C-580/13, Coty Germany GmbH v. Stadtsparkasse Magdeburg, ECLI:EU:C:2015:485, judgment of 16 July 2015, para. 43. Case C-324/09 L’Oréal v. eBay, ECLI:EU:C:2011:474, judgment of 12 July 2011, Order. Case C-70/10 Scarlet Extended v. SABAM, ECLI:EU:C:2011:771, judgment of 24 November 2011, para. 31. Case C-360/10 Netlog v. SABAM, ECLI:EU:C:2012:85, judgment of 16 February 2012, para. 29.

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Article 10 of the IPRED mandates the EU Member States to ensure that their judicial authorities 21.50 may order the recall, or the definitive removal, from the channels of commerce, or the destruction of goods which they have found to infringe IPRs. Article 13 of the IPRED requires the Member States to enable the competent judicial authorities to 21.51 order the infringer who knowingly, or with reasonable grounds to know, engaged in an infringing activity, to pay the right holder damages appropriate to compensate the actual prejudice suffered by him as a result of the infringement. The Directive also requires the Member States to provide for mechanisms to secure the effective recovery of damages, such as the precautionary seizure of the movable and immovable property of the alleged infringer, by blocking, including inaudita altera parte, his bank accounts and other assets.144 To that end, the competent authorities may order the communication of bank, financial or commercial documents, or appropriate access to the relevant information. Where the infringer acted in good faith, judicial authorities should, at the very least, be empowered to order the recovery of profits or the payment of damages. Article 13 of the Directive provides for two methods of calculating damages. They can either be calculated on the basis of the actual prejudice suffered (e.g., by taking account of the right holder’s lost profits, the infringer’s unfair profits, and/or the moral prejudice and other negative economic consequences incurred by the right holder). As an alternative, damages can also be awarded as a lump sum based on at least the amount of royalties which would have been due if the infringer had requested authorisation to use the IPRs in question. The Recitals specify that the aim of this provision is not to introduce an obligation to provide for punitive damages, but to allow for compensation based on an objective criterion, while taking the expenses incurred by the right holder, such as the costs of identification and research, into account.145 Because of the difficulty of assessing the economic losses and moral prejudice suffered by right holders in IPR infringement cases, the tool of ‘lump sum’ damages is a very useful way for courts to approximate the full extent of such damages that they reasonably believe have been incurred. In its judgment of 17 March 2016 in Case C-99/15, the CJEU held that Article 13 of the IPRED permits a party injured by an IPR infringement, who claims compensation for his material damage as calculated on the basis of the amount of royalties or fees which would have been due to him or her if the infringer had requested his authorisation to use that right, also to claim compensation for the moral prejudice that he or she has suffered.146 A few months later, it further specified that the same provision does not preclude national legislation under which the proprietor of a copyright that has been infringed may demand from the infringer either compensation for the damage that he or she has suffered, taking account of all the appropriate aspects of the particular case, or, without him or her having to prove the actual loss, payment of a sum corresponding to twice the appropriate fee which would have been due if permission had been given for the work concerned to be used.147 Finally, Article 14 of the IPRED provides that the successful party should, in principle, be able to 21.52 recover the costs of proceedings necessary for the effective protection or enforcement of IPRs. Falling within the scope of this provision, amongst others, are the costs relating to an exequatur procedure brought in a Member State, in the course of which the recognition and enforcement are sought of a judgment given in another Member State in proceedings seeking to enforce an IPR.148 Article 14 also applies to the legal costs incurred by the parties in the context of an action for

144 145 146 147 148

IPRED, Art. 9(2) and (4). Ibid., Recital 26. CJEU, Case C-99/15, Liffers v. Producciones Mandarina SL, and Mediaset España Comunicación SA, ECLI:EU: C:2016:173, judgment of 17 March 2017. CJEU, Case C-367/15, Stowarzyszenie ‘Oławska Telewizja Kablowa’ v. Stowarzyszenie Filmowców Polskich, ECLI:EU: C:2017:36, judgment of 25 January 2017. CJEU, Case C-406/09, Realchemie Nederland BV v. Bayer CropScience AG, ECLI:EU:C:2011:668, judgment of 18 October 2011.

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damages, brought in a Member State, to compensate for the injury caused as a result of a seizure carried out in another Member State, which was intended to prevent an IPR infringement, when, in connection with that action, a question arises concerning the recognition of a judgment given in that other Member State declaring that seizure to be unjustified.149 Article 14 does not preclude national legislation which provides that the unsuccessful party be ordered to pay the legal costs incurred by the successful party, which offers the courts responsible for making that order the possibility of taking into account features specific to the case before it, and provides for a flat-rate scheme for the reimbursement of costs for the assistance of a lawyer, subject to the condition that those rates ensure that the costs to be borne by the unsuccessful party are reasonable. However, it does preclude national legislation providing flat-rates which, owing to the maximum amounts that it contains being too low, do not ensure that, at the very least, a significant and appropriate part of the reasonable costs incurred by the successful party are borne by the unsuccessful party. It also precludes national rules providing that reimbursement of the costs of a technical adviser are provided for only in the event of fault on the part of the unsuccessful party, given that those costs are directly and closely linked to a judicial action seeking to have such an IPR upheld.150 21.53 The IPRED should have been transposed by the Member States into their national laws by 29 April 2006. However, many of them failed to comply with this deadline. This has considerably hindered the Commission’s task, under Article 18 of the Directive, of monitoring its implementation. The Commission eventually managed to produce a report on the implementation status in 2010.151 21.54 The most important problem pinpointed by this report was that the IPRED fell short of dealing adequately with digital infringements. Although the Directive applies indistinctly to infringements of IPRs online and offline, with hindsight it would have been undeniably better had the Directive included a chapter on digital infringements. As will be seen below,152 the interaction between the provisions of the Directive and those of other instruments – expecially concerning data protection – when it comes to combating internet piracy has given rise to a number of intricate issues,153 which the IPRED fails to address. 21.55 The Commission’s report also points out that, although the provisions implementing the IPRED into the national laws of the Member States do not, in general, exceed the minimum standards laid down in the Directive, several Member States have enacted legislation that gives more protection to IPR holders in some areas. For example, while Article 8 of the Directive limits the right to information to infringements committed on a commercial scale,154 in some Member States national

149 150 151

152 153

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CJEU, Case C-681/13, Simiramida-04 EOOD v. Diageo Brands BV, ECLI:EU:C:2015:471, judgment of 16 July 2015. CJEU, Case C-57/15, United Video Properties Inc. v. Telenet NV, ECLI:EU:C:2016:611, judgment of 28 July 2016. European Commission Staff Working Document, ‘Analysis of the application of Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004 on the enforcement of intellectual property rights in the Member States’ (SEC(2010) 1589 final), 14. The Staff Working Document is an accompanying document to the Report from the Commission to the Council, the European Parliament and the European Social Committee on the application of Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004 on the enforcement of intellectual property rights (COM(2010) 779 final). In addition, in 2011 and 2012, the Sub-group on Legal Framework of the European Observatory on Counterfeiting and Piracy, which was composed of Commission representatives and external counsels active in the field of intellectual property, conducted a number of surveys and studies to examine the implementation of the IPRED in the then 27 Member States and to identify best practices. Four comprehensive reports were produced in this context (on damages, corrective measures, evidence, and injunctions). See below, para. 21.101, in this regard. See paras 21.155 ff. On this subject, cf. the 2009 ‘Study on Online Copyright Enforcement and Data Protection in Selected Member States’ (Hunton & Williams, Brussels, April 2010, ). Indeed, Recital 14 of the IPRED states that:

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legislation extends this right to all infringements (whether on a commercial scale or not).155 Similarly, in respect of specific infringements (mostly infringements of copyright and related rights), a significant number of Member States have introduced lump-sum damages set as multiple (mostly double) amounts of royalties (licensing fees) due, which is not provided in the Directive.156 In some Member States, damages related to the infringer’s turnover can also be awarded. Thus, for example, Estonia allows for damage awards of the full retail price of the infringing goods in appropriate cases, while Spain allows for damage awards calculated as a percentage of the infringer’s turnover in certain cases.157 Such measures of value are properly viewed not as ‘punitive’ provisions but rather as proportionate remedies that recognise that, in order to achieve the requirement of the Directive that damage awards be dissuasive, none of the profit or other economic benefit of infringement should be left as a ‘reward’ with the infringer. Far from being a deterrent to infringement, those damages’ systems which refuse to relieve infringers of some of their profits or other economic benefits of infringement – such as by letting the infringer in some cases keep the part of a licence fee or distribution profit that a legitimate purchaser would have had to pay to the legitimate distribution channel – actually encourage infringers to take the risk of infringement, with little greater ‘downside’ than the normal licence fee even if the infringement is detected and proven. In several respects, the IPRED is regrettably vague. Thus, for example, it is unclear whether the 21.56 right of information must only be granted after a judgment on the infringement has been issued. Article 8 of the Directive merely states in this regard that this right should be available ‘in the context of proceedings concerning an infringement’. The situation differs from one Member State to another, with some providing that the right of information should be denied unless a judgment on the merits of the infringement claim has been rendered, and others providing that it should also be recognised in the framework of preliminary proceedings.158

[t]he measures provided for in Articles 6(2), 8(1) and 9(2) need to be applied only in respect of acts carried out on a commercial scale. This is without prejudice to the possibility for Member States to apply those measures also in respect of other acts. Acts carried out on a commercial scale are those carried out for direct or indirect economic or commercial advantage; this would normally exclude acts carried out by end consumers acting in good faith. 155

156 157

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Staff Working Document on the application of the IPRED (n 151 above), 11. In addition, the definition of ‘commercial scale’ in Recital 14 of the Directive does not appear to have pleased all the Member States, as some have chosen other definitions, more in accordance with their legal traditions, or even to omit the definition when implementing the Directive into national law (ibid., 9). Staff Working Document, ibid. 24. Report on ‘Damages’ drafted by the Sub-Group on Legal Framework of the European Observatory on Counterfeiting and Piracy, 2010, available at , 6; see para. 21.101 below in this regard. This report was updated in 2014 (). V. Fossoul, ‘The right of information: an illustration of the conflict between data protection and the enforcement of intellectual property rights’ (2013) BMM Bulletin, 1, 11. The author emphasises that, since infringement proceedings on the merits can be time-consuming in most Member States, to require a prior judgment on the infringement would have as a consequence that the requested information will often no longer be available once the order is granted, due to the lack of obligation on ISPs to retain data for a minimum period of time (see below, para. 21.166, in this regard). In its non-binding Communication of 29 November 2017 ‘Guidance on certain aspects of Directive 2004/48/EC of the European Parliament and of the Council on the enforcement of intellectual property rights’ (COM(2017) 708 final, 28) the Commission points out, with reference to the CJEU’s judgment in Case C-427/15 (NEW WAVE CZ, a.s. v. ALLTOYS, para. 27), that; [t]he specification in Article 8 of IPRED that a right of information order is available in the context of proceedings concerning an IPR infringement means that the provision of information need not necessarily be ordered in those same legal proceedings. It can also be ordered in separate subsequent proceedings brought with a view to a possible action for damages. Depending on the applicable provisions of national law, it may also be ordered at an earlier stage, by means of a preliminary injunction.

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21.57 Another area of ambiguity is the role of ISPs and hosting service providers under the IPRED. The notion of ‘intermediaries’ used in Articles 9 and 11 of the Directive has been broadly interpreted in the Member States, and ISPs,159 hosting service providers,160 operators of online marketplaces,161 warehousekeepers,162 tenants of market halls subletting their sales points,163 financial service providers,164 and ‘AdWords’ referencing providers,165 for example. There does not need to be a contractual relationship or connection between the (alleged) infringer and the intermediary for the right holder to be entitled to seek an injunction against an intermediary.166 Injunctions against intermediaries are used relatively often in the Member States as the infringers are frequently unknown. Such remedies have been successfully used in order to block access to websites which facilitate access to works protected by copyright or related rights without the consent of the right holder. Such injunctions often encourage the infringing party to engage in settlement discussions.167 The IPRED empowers the national courts to impose injunctions on intermediaries irrespective of whether or not they acted in good faith. Even though the conditions for issuing such injunctions are up to the Member States to create,168 they are provided irrespective of the intermediary’s liability.169 Nevertheless, the Member States have answered in a variety of ways the question of whether or not 159 160 161 162 163 164

Case C-70/10 Scarlet Extended v. SABAM (n 142 above). Case C-360/10 Netlog v. SABAM (n 143 above). Case C-324/09 L’Oréal v. eBay (n 141 above). Cf. O. O’Byrne and R. Burstall, ‘Liability of landlords for infringing activities’, (2011) JIPLP, 6, 738; and CJEU, Case C-379/14 Top Logistics & Van Caem International v. Bacardi, ECLI:EU:C:2015:497, judgment of 16 July 2015. CJEU, Case C-494/15 Tommy Hilfiger Licensing LLC and Others v. Delta Center a.s., ECLI:EU:C:2016:528, judgment of 7 July 2016. See further below, Section V, in this regard. In the LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten case, the CJEU held that: access providers who merely provide users with Internet access, without offering other services such as email, FTP or file-sharing or exercising any control, whether de jure or de facto, over the services which users make use of, must be regarded as ‘intermediaries’ within the meaning of Article 8(3) of Directive 2001/29.

165 166 167 168 169

(Order of 19 February 2009, LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten v. Tele2 Telecommunication GmbH, C-557/07, ECLI:EU:C:2009:107). Joined Cases C-236/08 to C-238/08 Google France and Google, ECLI:EU:C:2010:159, judgment of 23 March 2010. CJEU, Case C-314/12 UPC Telekabel Wien GmbH v. Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft mbH, ECLI:EU:C:2014:192, judgment of 27 March 2014, paras 34–35. Commission Staff Working Document on the application of the IPRED (n 151 above), 15. IPRED, Recital 23. Lory and Hecˇko point out, in this regard, that, ‘in order to be injuncted, intermediaries do not need to be liable (contributory liable or aiding or abetting) for the infringement’, B. Lory and Z. Hecˇko, ‘EU law and policies on intellectual property rights enforcement’ in Vrins and Schneider, 2012, n 10 above, para. 4.54). See also M. Husovec, ‘Injunctions against innocent third parties: the case of website blocking’, (2012) JIPITEC 116 [117]. The author refers, in this respect, to the CJEU’s judgment in L’Oréal v. eBay (n 141 above), para. 128, where the Court pointed out that injunctions against intermediaries stipulated in Art. 11 of the IPRED differ from injunctions which may be obtained against infringers of an IPR. He also relies on the way in which the Court rephrased the submitted question: [This] provision requires the Member States to ensure that the operator of an online marketplace may, regardless of any liability of its own in relation to the facts at issue, be ordered to take, in addition to measures aimed at bringing to an end infringements of intellectual property rights brought about by users of its services, measures at preventing further infringements of that kind … (emphasis added). The author refers, in the third place, to the European Commission’s Report on the application of the IPRED (n 151 above), where the Commission states, inter alia, that: it appears that in some Member States it is not possible to issue injunctions unless the liability of an intermediary is established. However, neither Article 11 (third sentence) of the Directive, nor Article 8(3) of Directive 2001/29 link injunctions with the liability of an intermediary. […] Injunctions against intermediaries are not intended as a penalty against them, but are simply based on the fact that such intermediaries (e.g. Internet service providers) are in certain cases in the best position to stop or to prevent an infringement. Finally, reference is made in M. Husovec’s contribution to the Opinion of Advocate General Kokott in case C-119/10, Frisdranken Industries Winters BV v. Red Bull GmbH, ECLI:EU:C:2011:258, 14 April 2011, at para. 39. In its non-binding ‘Guidance on certain aspects of Directive 2004/48/EC of the European Parliament and of the Council on the enforcement of intellectual property rights’ (n 171 above, 17), the Commission shares Husovec’s view that ‘[t]he

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the IPRED authorises the issuing of injunctions on intermediaries regardless of whether or not they are liable under civil or criminal law for the rights infringements.170 Next, although there appears to be broad consensus among the Member States that damages’ 21.58 awards in principle should result in complete indemnification of the injured right holder, at least in cases where the infringer knew or should have known that his conduct was infringing,171 it appears that the damages granted by the courts in IPR cases remain rather limited.172 Consequently, most cases end at the stage of granting an injunction and do not reach the stage of requesting damages. The Staff Working Document on the application of the Directive further acknowledges that: [s]ince the pecuniary value of intellectual property may be rather difficult to measure, also due to its ‘abstract’ nature, practice has shown that assessing damages for infringements of IPRs is often complicated. Damages from sales of counterfeit goods over the Internet are even more difficult to assess, and it often happens that after having been discovered, infringers quickly re-appear under a different name. This situation has not changed significantly through the entry into force of the IPRED. In most cases only slight adjustments of national laws governing the calculation and award of damages were needed to make Member States comply with the Directive. However, due to the relatively low number and the considerable length of the judicial proceedings, there is not yet an established case law on the evaluation and assessment of damages since the transposition of the Directive in the Member States. At the same time it seems that existing judgements have not been overly explicit and detailed on how awarded damages have been calculated.173

Similar problems were identified regarding compensation for the costs of proceedings. The costs of 21.59 litigation concerning IPRs are often significant. Internet-based infringements often require costly and time-consuming investigations. Test purchases are sometimes necessary. ‘Furthermore, given the (often) cross-border nature of the infringing activities, experts from several jurisdictions may be required to assist. These costs are not always fully taken into consideration by the courts. In some jurisdictions, only the fees of the experts appointed by the court are reimbursed.’174 The possibility of a 100 per cent reimbursement of legal and enforcement costs was reported only in a limited number of countries, mostly in Central and Eastern Europe. The reimbursement of legal costs and other expenses in a successful litigation usually remains far below the actual legal costs incurred.175 As regards the disposal of infringing goods, the Commission’s survey shows that, since the Directive 21.60 requires the Member States to provide for corrective measures which are dissuasive,176 destruction of infringing goods has, generally, been the preferred (and most commonly used) corrective measure in the Member States.177 The measures of ‘market recall’ and/or ‘definitive removal from the market’ of the infringing products are often considered in strict relationship with the destruction. It is normally necessary to collect the items that should be destroyed, otherwise only the infringing products already seized or still present at the infringer’s premises at the outcome of the proceedings

170

171 172 173 174 175 176 177

possibility to issue an injunction against an intermediary on the basis of Articles 9(1)(a) and 11 of IPRED does not depend on the intermediary’s liability for the (alleged) infringement in question’. On this issue, cf., inter alia, I. Stamatoudi, ‘Data protection, secrecy of communications and copyright protection. Conflicts and convergences. The Example of Promusicae v. Telefonica ’, in I. Stamatoudi (ed.), Copyright Enforcement and the Internet, Information Law Series, Kluwer Law International, 2010. Report on ‘Damages’ drafted by the Sub-Group on Legal Framework of the European Observatory on Counterfeiting and Piracy (n 157 above), 4. Commission Staff Working Document on the application of the IPRED (n 151 above), 21. Ibid., 22. Ibid., 24. Ibid. IPRED, Art. 3(2). Commission Staff Working Document on the application of the IPRED (n 151 above), 20.

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on the merits would be destroyed. Recourse to the measures of ‘market recall’ and/or ‘definitive removal’ saves the costs of multiple seizures at several different locations.178 21.61 An online consultation on the efficiency of proceedings and the accessibility of measures for the civil enforcement of IPR was launched on 30 November 2012 and closed on 30 March 2013. A ‘Synthesis of the Responses’ to this consultation was published by the Commission in July 2013.179 The following most-cited reasons for refraining from litigation against IPR infringements were indicated: too lengthy and too expensive procedures, the low likelihood of being compensated at the end of the proceedings, and the low likelihood of successfully proving the infringement to the required standard. They were often followed by other factors, such as the lack of courts and judges specialised in the field, limited effective remedies – also regarding identifying the infringer – and requirements to incur expensive guarantees while seeking an injunction. Some stakeholders, in principle, focus on criminal and administrative procedures or consider minor infringements as having too little importance in damaging their rights.180 Despite acknowledging the general increase of cross-border IPR infringements, the vast majority of stakeholders did not launch proceedings concerning such infringements. Almost one-third of respondents took the view that, in spite of Article 14 of the IPRED, there are still substantial disparities among the Member States regarding compensation for legal costs: in many cases, the winning party may receive only a small percentage or capped fixed sums or the courts may divide the costs proportionally between the parties. This leads to receipt of de facto statutory amounts that tend not to cover the actual costs incurred by the winning party. As regards the length of proceedings, it appears from the responses to the consultation that the average time of court proceedings on the merits of a case varies from less than two years to between three and five years.181 Following the public consultation and to ensure a more consistent and effective application of the Directive, the Commission issued non-binding guidance on the interpretation and application of the measures, procedures and remedies it contains.182 iii.

The Brussels I bis Regulation

21.62 Regulation (EU) No 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial (‘Brussels I bis’ Regulation)183 is another important legal instrument in civil and commercial matters. It supersedes Council Regulation (EC) No 44/2001,184 which in turn replaced the 1968 Brussels Convention on the same subject.185 On 1 July 2007, Denmark signed a special agreement with the EU making the Regulation binding in Denmark.186 As regards the

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180 181 182 183 184 185 186

Report on the implementation of the IPRED regarding ‘Corrective Measures’ drafted by the Sub-Group on Legal Framework of the European Observatory on Counterfeiting and Piracy, available at , 3. European Commission, ‘Synthesis of the Responses: Civil Enforcement of Intellectual Property Rights: Public Consultation on the Efficiency of Proceedings and Accessibility of Measures’, July 2013, . Ibid., 7. Ibid., at 9. Commission Communication, ‘Guidance on certain aspects of Directive 2004/48/EC of the European Parliament and of the Council on the enforcement of intellectual property rights’, n 171 above. See n 53 above. [1998] OJ C27/1. [2012] OJ L351/1. Agreement between the European Community and the Kingdom of Denmark on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters [2005] OJ L299/62.

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relationship between the EU, Iceland, Norway and Switzerland, the 1988 Lugano Convention remains applicable.187 As will be explained in more detail in a separate chapter of this book,188 the ‘Brussels I bis’ 21.63 Regulation lays down uniform rules to settle conflicts of jurisdiction and to facilitate the enforcement of judgments throughout the EU. Most of the jurisdiction rules of the Regulation apply only when the defendant is domiciled in a Member State. If this is not the case, the Regulation defers to national law, except in cases where the courts of a Member State have exclusive jurisdiction pursuant to Articles 24 or 25 of the Regulation. By contrast, defendants domiciled in a Member State may rely on the provisions of the Regulation in disputes involving parties domiciled in third countries.189 As regards the determination of jurisdiction of the courts in the Member States, Article 4(1) of the 21.64 Regulation states that, as a matter of principle, persons domiciled in a Member State shall, whatever their nationality, be sued in the courts of that Member State. However, the Regulation contains a number of provisions on ‘special jurisdiction’, ‘exclusive jurisdiction’, ‘lis pendens ’ and ‘related actions’. An example of the ‘special jurisdiction’ rule is Article 7(2), which provides that a person domiciled in a Member State may, in another Member State, be sued, in matters relating to tort, delict, or quasi-delict, in the courts for the place where the harmful event occurred or may occur. Finally, pursuant to Article 35, application may be made to the courts of a Member State for any provisional measures that may be available under the law of that State, even if, under the Regulation, the courts of another Member State have jurisdiction as to the substance of the matter. The interpretation of Article 7(2) of the Regulation190 in relation with the digital environment has 21.65 given rise to interesting discussions before the CJEU. In its judgment of 25 October 2011 in the eDate Advertising case, the CJEU held that Article 7(2) of the Regulation had to be interpreted as meaning that, in the event of an alleged infringement of personality rights by means of content placed online on a website, the person who considers that his rights have been infringed has the option of bringing an action for liability, in respect of all the damage caused, either before the courts of the Member State in which the publisher of the content is established, or before the courts of the Member State in which the centre of his interests is based. The claimant may also, instead of an action for liability in respect of all the damage caused, bring his action before the courts of each Member State where the online content is or has been accessible. Those courts have jurisdiction only in respect of the damage caused in the territory of the Member State of the court before which the action is brought.191 Transposed to the copyright field, this concretely means that a copyright infringement claim, seeking to prevent further communication to the public of copyright material via a website accessible in all Member States, can be brought before the courts of any Member State, pursuant to Article 7(2) of the Regulation. It is irrelevant in this context whether or not the website is (or was) directed to all or only some of the Member States; the mere accessibility of the website in the Member State where proceedings are envisaged is sufficient. The principles laid down in eDate Advertising were transposed accordingly to the field of copyright in case C-170/12.192 In this case, a French author had discovered that some of his songs had been reproduced without his consent on compact discs pressed in Austria by an Austrian company named Mediatech. He managed to 187 188 189 190 191 192

Convention on jurisdiction and the enforcement of judgments in civil and commercial matters, done at Lugano on 16 September 1988 [1988] OJ L319/9. See Chapter 24 of this book. Case C-412/98 Group Josi Reinsurance Company SA v. Universal General Insurance Company (UGIC), ECLI:EU: C:2000:399, judgment of 13 July 2000. Or the corresponding provision of Regulation 44/2001, Art. 5(3). Joined Cases C-509/09 and C-161/10 eDate Advertising GmbH v. X and Olivier Martinez and Robert Martinez v. MGN Ltd., ECLI:EU:C:2011:685, judgment of 25 October 2011. CJEU, C-170/12, Peter Pinckney v. KDG Mediatech AG, ECLI:EU:C:2013:635, judgment of 3 October 2011.

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purchase records of these songs in France on an internet site accessible to the French public, and then sued Mediatech for damages before the French courts. The CJEU ruled that the fact that the claimant had been able to purchase the records in France from a website accessible to French internet users was sufficient to establish a substantial connection between the facts and the alleged damage, justifying the jurisdiction of the French courts. Thus, according to the Court, in the event of alleged infringement of copyrights protected by the Member State of the court seised, the latter has jurisdiction under Article 7(2) of the Regulation to hear an action to establish liability brought by the author of a work against a company established in another Member State and which has, in the latter State, reproduced that work on a material support which is subsequently sold by companies established in a third Member State through an internet site also accessible within the jurisdiction of the court seised. However, that court has jurisdiction only to determine the damage caused in the Member State within which it is situated. The CJEU reached these conclusions by first pointing out that Article 7(2) of Regulation 1215/2012 (formerly, Art. 5(3) of Regulation 44/2001) does not require that the disputed activity be directed to the Member State in which the court seised is situated. The reasoning followed by the Court in Pammer and Hotel Alpenhof,193 with respect to jurisdiction in contractual matters, is, therefore, not transposable to Article 7(2). Next, the Court distinguished copyright from industrial property rights. It recalled that the allegation of an infringement of an industrial property right, in respect of which the protection granted by registration is limited to the territory of the Member State of registration, must be brought before the courts of that State; indeed, as the Court has held in Wintersteiger,194 the courts of the Member State of registration are the best placed to ascertain whether the industrial property right at issue has been infringed. By contrast, the Court stressed that copyrights must be automatically protected, by virtue of the InfoSoc Directive, in all Member States, so that they may be infringed in each one in accordance with the applicable substantive law. It follows that, as regards the alleged infringement of a copyright, jurisdiction to hear an action in tort, delict or quasi-delict is already established in favour of the court seised if the Member State in which the court is situated protects the copyrights relied on by the claimant, and the harmful event alleged may occur within the jurisdiction of the court seised. That likelihood arises, for example, from the possibility of obtaining a reproduction of copyright protected material from an internet site accessible within the jurisdiction of the court seised. However, if the protection granted by the Member State of the place of the court seised is applicable only in that Member State, the court seised only has jurisdiction to determine the

193

Joined Cases C-585/08 and C-144/09, ECLI:EU:C:2010:740, judgment of 7 December 2010. This case concerned the interpretation of Art. 15(1)(c) of Regulation 44/2001, now Art. 17(1)(c) of Regulation 1215/2012, which provides that: [i]n matters relating to a contract concluded by a person, the consumer, for a purpose which can be regarded as being outside his trade or profession, jurisdiction shall be determined by this Section […] if: […] (c) in all other cases, the contract has been concluded with a person who pursues commercial or professional activities in the Member State of the consumer’s domicile or, by any means, directs such activities to that Member State or to several States including that Member State, and the contract falls within the scope of such activities. (emphasis added)

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The Court held that, in order to determine whether a trader whose activity is presented on its website or on that of an intermediary can be considered to be ‘directing’ its activity to the Member State of the consumer’s domicile, within the meaning of this provision, it must be ascertained whether, before the conclusion of any contract with the consumer, it is apparent from those websites and the trader’s overall activity that the trader was envisaging doing business with consumers domiciled in one or more Member States, including the Member State of that consumer’s domicile, in the sense that it was minded to conclude a contract with them. The Court further stressed that the mere accessibility of the trader’s or the intermediary’s website in the Member State in which the consumer is domiciled is insufficient in this regard. CJEU, C-523/10, Wintersteiger AG v. Products 4U Sondermaschinenbau GmbH, ECLI:EU:C:2012:220, judgment of 19 April 2012. In this case, the Court held that Art. 5(3) of Regulation 44/2001, now Art. 7(2) of Regulation 1215/2012, had to be interpreted as meaning that an action relating to infringement of a trademark registered in a Member State because of the use, by an advertiser, of a keyword identical to that trademark on a search engine website operating under a country-specific top-level domain of another Member State, may be brought before either the courts of the Member State in which the trademark is registered or the courts of the Member State of the place of establishment of the advertiser.

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damage caused within the Member State in which it is situated; indeed, if that court also had jurisdiction to adjudicate on the damage caused in other Member States, it would substitute itself for the courts of those States even though, in principle, in the light of Article 7(2) of the Regulation and the principle of territoriality, the latter have jurisdiction to determine, first, the damage caused in their respective Member States and are best placed to ascertain whether the copyrights protected by the Member State concerned have been infringed and, second, to determine the nature of the harm caused. Under Regulation 44/2001, the provisions of Articles 27 (lis pendens) and 28 (related actions) have 21.66 often been used – and abused – to block or slow down the handling of court proceedings through the introduction of two parallel sets of proceedings. Article 27 stated that, where a Member State court is seised of proceedings between the same parties and involving the same cause of action as proceedings previously initiated before another Member State court, then the court second seised had to stay the proceedings before it until the court first seised had determined whether or not it had jurisdiction to handle the case, regardless of whether or not the proceedings brought first had been instituted in the wrong jurisdiction, in breach of a jurisdiction clause. The ‘first in time’ rule laid down in Article 27 of the Regulation thus allowed litigators to initiate the first set of proceedings before a jurisdiction reputedly moving slowly in order to delay the procedure introduced later on by the adverse party in another Member State (the so-called ‘Italian torpedo’).195 Moreover, in patent law it has proved quite difficult to bring consolidated proceedings against several European patents, even in cases where all the defendants belonged to the same ‘concern of undertakings’ and acted in accordance with a coordinated policy.196 In the field of copyright and related rights too, the lack of complete harmonisation frequently hampers the consolidation of proceedings at the EU level through the operation of the rules on lis pendens and related actions. The CJEU’s case law has made it difficult for national courts to admit the consolidation of claims against a defendant infringing parallel IPRs in force in different Member States, and to join claims against multiple defendants engaged in concerted actions. As some had rightly predicted, this has created a significant obstacle to the enforcement of IPRs throughout the EU.197 By contrast, in cases of infringements of European Union trademarks or Community designs, granting of cross-border injunctions by the European Union trademark courts and Community design courts in the Member States is foreseen by the law as these rights are unitary EU titles.198 However, the courts having jurisdiction under Article 4 of the Regulation, that is, on the basis of 21.67 the defendant’s domicile, are in principle entitled to issue injunctions with extra-territorial effect, irrespective of the IPR involved. Regulation 1215/2012 aims to tackle the issue of Italian torpedos by improving the rules on lis 21.68 pendens. It seeks to reverse this ‘first in time’ rule where the parties have agreed an exclusive jurisdiction clause, and to give precedence to the courts specified in such clauses. Articles 29–34 of Regulation 1215/2012 allow the courts of a given Member State to handle the case on a

195 196 197

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Case C-315/01, Gesellschaft für Antriebstechnik GmbH & Co KG v. Lamellen und Kupplungsbau Beteiligungs KG (GAT/LuK), ECLI:EU:C:2003:360. Case C-539/03, Roche Nederland BV v. Frederick Primus, Milton Goldenberg (Roche/Primus), ECLI:EU:C:2006:458. European Max-Planck Group on Conflict of Laws in Intellectual Property (CLIP), ‘Exclusive jurisdiction and cross border IP (patent) infringement: suggestions for amendment of the Brussels I Regulation’ (2007) European Intellectual Property Review 195, 195–197. See Regulation 2017/1001 on the European Union trademark, Art. 126(1); Regulation 6/2002 on Community designs, Art. 90(3). See also, in this regard, CJEU, C-235/09 DHL Express France SA (formerly DHL International SA) v. Chronopost SA, ECLI:EU:C:2011:238, judgment of 12 April 2011. Such injunctions remain, however, subject to the procedures for recognition and enforcement pursuant to Chapter III of the ‘Brussels I bis’ Regulation.

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discretionary basis when the parties have agreed a jurisdiction or ‘choice of court’ clause, even if the court of another Member State or of a third party country was first seised of the dispute.199 21.69 As regards the recognition and execution of foreign judgments, Article 36(1) of the Regulation states that ‘[a] judgment given in a Member State shall be recognised in the other Member States without any special procedure being required’. However, Article 45(1) stipulates that recognition of a foreign judgment may be refused in a limited number of cases, such as if it would be manifestly contrary to public policy or irreconcilable with an earlier judgment, or where the document initiating the proceeding has not been served in good time or the other party does not appear. 21.70 Article 39 further states that a judgment given in a Member State which is enforceable in that State can be enforced in another Member State without any declaration of enforceability being required. Regulation 1215/2012 thus abolishes exequatur procedures in the EU, which, under Regulation 44/2001 and the 1968 Brussels Convention had often proved to be intolerably long and costly.200 In an internal market without frontiers, it is difficult to justify that citizens and businesses have to undergo expenses in terms of costs and time to assert their rights abroad.201 As from 10 January 2015, the date on which the new instrument became applicable,202 it is possible to enforce in a Member State a judgment (in civil or commercial matters) delivered in another Member State, subject to the mere production of a certified copy of the judgment. Recourses are possible a posteriori for the debtor, but only in a limited number of cases.203 21.71 Some issues arising from Regulation 44/2001 have, unfortunately, remained unsolved in the recast Regulation, inter alia, in relation to online IPR infringements. The cross-border collection of evidence, for example, which is crucial as regards the enforcement of IPRs on the Web, is a tricky issue, to say the least. Under Regulation 44/2001, court orders issued in some Member States had proved to be very difficult to enforce in others.204 Regulation 1215/2012 fails to provide suitable solutions to these problems.

B. Customs enforcement of copyright and related rights 21.72 The first legislative instrument dealing with the issue of IPR enforcement through border measures in the EU was the 1986 Council Regulation 3842/86 laying down measures to prohibit the release

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Art. 31(2) provides that any court other than the designated court ‘shall stay the proceedings until such time as the court seised on the basis of the agreement declares it has not jurisdiction under the agreement’. It should be noted that Regulation 1215/2012, unlike Regulation 44/2001, contains provisions allowing Member State courts with the discretion to stay proceedings to take account of proceedings pending before the courts of a non-EU country. For that purpose, the Member State court must assess ‘all the circumstances of the case before it’ (Recital 24), which: may include connections between the facts of the case and the parties and the third State concerned, the stage to which the proceedings in the third State have progressed by the time proceedings are initiated in the court of the Member State and whether or not the court of the third State can be expected to give judgment within a reasonable time.

200 201 202 203

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Commission’s report on the application of Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, COM(2009) 174 final, 4. Commission’s Green Paper of 21 April 2009 on the review of the Brussels I Regulation, COM(2009) 175 final, 2. With the exception of Arts 75 and 76 of the Regulation, which became applicable on 10 January 2014 (Regulation 1215/2012, Art. 81). That is, if extraordinary circumstances impeded the debtor from appearing before the court, or if the summon was not served validly to him/her. In addition, the debtor will still be able to challenge the enforcement of the judgment if the principles of fair trial have not been complied with. On these issues, see, e.g., I. Stamatoudi, ‘Towards an updated EU Enforcement Directive? Selected topics and problems’, Proceedings of the Fourth International Conference on Information Law and Ethics (May 2011), , pp. 9–10.

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for free circulation of counterfeit goods.205 Subsequently, Regulation 3295/94 of 22 December 1994 laying down measures to prohibit the release for free circulation, export, re-export or entry for a suspensive procedure of counterfeit and pirated goods widened the scope of the 1986 Regulation to additional customs procedures and to infringements of copyright, related rights, and design rights.206 This Regulation was amended in 1999 so as to include patent and SPC infringements.207 It was finally superseded by Regulation 1383/2003 of 22 July 2003 concerning customs action against goods suspected of infringing certain intellectual property rights and the measures to be taken against goods found to have infringed such rights.208 In turn, Regulation 1383/2003 underwent a revision process. The adoption of a new legal 21.73 framework on the enforcement of IPRs by Customs was first requested by the EU Council in September 2008 in its Resolution outlining a comprehensive anti-counterfeiting plan for the EU.209 This Resolution was followed, on 16 March 2009, by a Resolution on a new EU Customs Action Plan for the years 2009–12,210 which was designed to enhance operational performance, collaboration with industry, international cooperation, and awareness-raising, responding to the problem of internet sales, in line with the EU’s long-standing policy and strategy on the protection of IPRs, as reflected in the Commission’s Communication of 11 November 2010 on a Single Market Act.211 The reinforcement of Customs cooperation was also requested in the Council’s Resolution of 23 October 2009.212 On 24 May 2011, the Commission proposed a new Regulation on Customs enforcement of IPRs.213 Regulation 608/2013,214 which is applicable since 1 January 2014, eventually replaced Regulation 1383/2003. The ‘Border Measures Regulation’, as it is often called, is a procedural regulation, which does not 21.74 create new substantive intellectual property rights. It mandates the customs authorities of the Member States to detain or suspend the release of goods which are suspected of infringing trademark rights, copyright or related rights, design rights, patents, SPCs, plant variety rights, or protected geographical indications. The scope of the new Regulation has also been widened so as to cover additional IPRs compared to Regulation 1383/2003, such as, inter alia, rights of creators of topographies of a semiconductor product, utility models, and trade names (insofar as these are protected as exclusive property rights in the national law of the Member State in which Customs action is requested). Goods that are designed to circumvent technological protection measures also fall within the new Customs enforcement regime.215

205 206 207 208 209 210 211

212 213

214

215

See n 33 above. See n 65 above. See n 66 above. See n 67 above. Council Resolution of 25 September 2008 (n 42 above). Council Resolution of 16 March 2009 on the EU Customs Action Plan to combat IPR infringements for the years 2009 to 2012 (n 75 above). Communication from the Commission of 11 November 2010, ‘Towards a Single Market Act. For a highly competitive social market economy. 50 proposals for improving our work, business and exchanges with one another’, COM(2010) 608 final/2. Council Resolution of 23 October 2009 on a reinforced strategy for customs cooperation [2009] OJ C260/1. Proposal for a Regulation of the European Parliament and of the Council concerning customs enforcement of intellectual property rights, COM(2011) 285 final. For a detailed analysis of the Commission’s proposal, see O. Vrins, ‘The European Commission’s proposal for a regulation concerning customs enforcement of IP rights’, (2011) JIPLP, 6, 774. See also Vrins and Schneider, 2012, n 10 above, paras 5.587 ff. See n 7 above. Regarding this Regulation, see Vrins, O., Regulation (EU) No 608/2013 of 12 June 2013 Concerning Customs Enforcement of Intellectual Property Rights and Repealing Regulation 1383/2003, Kluwer, International Encyclopaedia of Laws (IEL), Intellectual Property series, 2017. See the definition of ‘intellectual property right’ in Art. 2(1) of Regulation 608/2013.

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21.75 Another objective of the new Regulation was to extend border measures to a larger number of IPR infringements than under Regulation 1383/2003. Thus, Regulation 608/2013 extends border measures to all forms of infringements,216 with the exception of parallel imports of goods produced by the right holder or under (and in compliance with a) licence from the latter217 and goods transported in personal luggage provided that there are no indications to suggest that they are of a commercial nature.218 As the CJEU has observed, ‘[p]ersonal use, by definition, varies from one person to another, and from one culture to another’. The question whether an importation of goods is non-commercial, within the meaning of Article 6 of Directive 2007/74/EC, ‘must therefore be examined case by case on the basis of an overall assessment of the circumstances, account being taken of the frequency with which those goods are imported by the traveller concerned, but also, where appropriate, taking account of that traveller’s lifestyle and habits or of his family environment’. While the nature and quantity of the goods under consideration are among the indicators to be taken into account, customs authorities cannot confine themselves to those indicators in assessing whether or not the importation is commercial.219 The need for an overall assessment precludes national administrative instructions or practices which impose binding quantitative limits which would have the effect of creating an irrebuttable presumption that the importation concerned is commercial by reason of the quantity of goods imported; instructions may nevertheless be drawn up by the customs authorities, as long as they are not an indirect way of introducing an irrebuttable presumption that imports are commercial, but are simply a non-binding criterion designed to facilitate customs procedures.220 21.76 The Regulation also covers moulds and matrices that are specifically designed or adapted for the manufacture of goods infringing IPRs,221 and authorises customs actions against logos, labels, stickers, brochures, instructions for use, guarantee documents, and packaging materials bearing a

216

217

218

219

220 221

Ibid., Arts 1 and 2(7)(a). By contrast, Regulation 1383/2003, as regards trademark infringements and copyright and related right infringements, only applied to ‘counterfeit goods’ and ‘pirated goods’, defined in a narrow way (see Art. 2(1)(a)(i) and (b) of Regulation 1383/2003). ‘Pirated goods’, for example, were defined as ‘goods which are or contain copies made without the consent of the holder of a copyright or related right or design right, regardless of whether it is registered in national law, or of a person authorised by the right-holder in the country of production’ in cases where the making of those copies would constitute a copyright or related right infringement under national law. It is unclear how the concept of ‘copies’ had to be interpreted. Most legal authors tended to consider that in order to fall within the scope of Art. 2(1)(b) of Regulation 1383/2003, goods did not need to be identical copies of the original (see, e.g., A. Petersen-Padberg, ‘Regulation 1383/2003’, in T. Cottier and P. Veron (eds), Concise International and European IP Law, 2nd ed., Kluwer Law International, 2011, commenting on Art. 2, n 3(a), 387. See also M. Schneider and O. Vrins, ‘Regulation 1383/2003’, in Vrins and Schneider, 2012, paras. 5.63–5.69). On the other hand, it was unclear whether an unauthorised adaptation of a work protected under copyright, for example, also had to be considered as a ‘copy’ in the sense of Art. 2(1)(b) of Regulation 1383/2003. Ibid., Art. 1(5). The Commission’s proposal to broaden the scope of the new Regulation to such goods was indeed rejected by the IMCO Committee of the European Parliament, as well as the Council. It should be noted that, regarding copyright, the CJEU has held that the breach of a clause in a copyright licence agreement ‘falls within the concept of “infringement of intellectual property rights”, within the meaning of Directive 2004/48, and that, therefore, the copyright owner must be able to benefit from the guarantees provided for by that directive, regardless of the liability regime applicable under national law’ (CJEU, Case C-666/18 IT Development SAS v. Free Mobile SAS, ECLI:EU:C:2019:1099, judgment of 18 December 2019, para. 49). Thus, the copyright owner should, by analogy, also be able to rely on Regulation 608/2013 in such a scenario. Ibid., Art. 3(4). Although there is no definition of ‘commercial nature’ in Regulation 608/2013, imports of a non-commercial character have been defined in Art. 6 of Directive 2007/74/EC as those which ‘take place occasionally’, and consist ‘exclusively of goods for the personal or family use of the travellers, or of goods intended as presents’. The nature or quantity of the goods must not be such as to indicate that they are being imported for commercial reasons. CJEU, Case C-99/00 Kenny Roland Lyckeskog, ECLI:EU:C:2002:329, judgment of 4 June 2002, paras. 26–27 (regarding the interpretation of Art. 45(2)(b) of Council Regulation (EEC) No 918/83 of 28 March 1983 setting up a Community system of reliefs from customs duty ([1983] OJ L105/1), which was worded in the same way and pursued the same objectives as Art. 6 of Directive 2007/74/EC). Ibid., paras 32–33. Reg. 608/2013, Art. 2(7)(c).

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counterfeit trademark or geographical indication, even if shipped separately from the goods for which they are destined.222 The Regulation sets up an easy process enabling right holders to request customs action against 21.77 infringing goods. For that purpose, the Annexes to the implementing Regulation to the Border Measures Regulation contain standard application forms for right holders to request border measures by customs authorities.223 For EU-wide protection titles, such as European Union trademarks, Community designs, Community plant variety rights, or geographical indications protected throughout the EU, right holders are allowed to file a so-called ‘Union application’ in any EU Member State, requesting action in other Member States as well.224 Customs authorities can also take custody of goods – with the exception of perishable goods – ex officio and invite right holders subsequently to file an application for action.225 In all cases, right holders must assume full responsibility for the seizures initiated at their request.226 The Regulation applies whenever suspected goods cross one of the EU’s external borders, 21.78 irrespective of their Customs status, as long as they are under Customs supervision. In other words, it applies not only to goods which are being exported from, or released for free circulation in, the EU, but also to in-transit or trans-shipped goods, and to goods which are stored in a free zone or warehouse – provided, again, that the goods can in such case be reasonably suspected of infringing IPRs.227 In this regard, the CJEU has held that goods cannot be suspected of infringing IPRs in the EU, and may not, therefore, be detained by Customs under the Border Measures Regulation, when there are no indications that they are intended for the EU market.228

222 223

224 225

226 227 228

Ibid, Art. 2(5)(c). See Reg. 608/2013, Art. 6, and Commission Implementing Regulation No 1352/2013 of 4 December 2013 establishing the forms provided for in Regulation (EU) No 608/2013 of the European Parliament and of the Council concerning customs enforcement of intellectual property rights [2013] OJ L341/10. The European Commission has established a manual for right holders for lodging applications for action (). The Commission’s website also contains a list of the customs departments competent in the Member States to process such applications: . See Regulation 608/2013, Arts 2(11) and 3(4). Ibid., Art. 18. It should be noted that the number of ex officio actions has, however, dramatically decreased between 2008 (26.5%) and 2012 (2.62%) (European Commission (DG TAXUD), ‘Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2012’, , 10). For several years now, the percentage of ex officio detentions has been very low (around 2%) (European Commission (DG TAXUD), ‘Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2018’, 8). The filing of an application for action by the right holders is, therefore, highly recommended. Since 2002, the number of applications for action made in the Member States has increased from 1,671 (European Commission (DG TAXUD), ‘Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2012’, 2) to 34,047 in 2018 (European Commission (DG TAXUD), ‘Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2018’, 8). See Regulation 608/2013, Art. 28. Ibid., Art. 1(1). The Regulation does not apply, however, to goods that have been released for free circulation under the end-user regime (ibid., Art. 1(3)). Joined Cases C-446/09 and C-495/09, Koninklijke Philips Electronics NV v. Lucheng Meijing Industrial Company Ltd. and Ors and C-495/09 Nokia Corporation v. Her Majesty’s Commissioners of Revenue and Customs, ECLI:EU:C:2011:796, judgment of 1 December 2011. This judgment was delivered in relation with Regulation 3295/94 (as amended in 1999) and Regulation 1383/2003. However, it remains relevant under Regulation 608/2013, except for trademarks registered within the EU; indeed, the EU legislature has enacted new provisions on counterfeit goods in transit (see Directive 2015/2436, Art. 10(4), and Regulation 2017/1001, Art. 9(4)). See, in this regard, the Commission notice on the customs enforcement of intellectual property rights concerning goods brought into the customs territory of the Union without being released for free circulation including goods in transit [2016] OJ C244/4. Art. 24(1) of Regulation 2019/787 has also extended the protection of geographical indications for spirit drinks, as defined in Art. 21(2) of that Regulation, to ‘goods entering the customs territory of the Union without being released for free circulation there’.

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21.79 Unfortunately, the new Regulation thus fails to tackle the issue of goods that are purely in transit through the EU. However, customs authorities in the Member States are now expressly allowed to share information concerning suspected goods that they have come across with their colleagues in the destination country to encourage seizure on arrival.229 This is in compliance with Article 69 of the TRIPS Agreement.230 21.80 Regulation 608/2013 sets out a new type of simplified procedure enabling Customs in some cases to destroy small consignments of allegedly counterfeit or pirated non-perishable goods.231 This new procedure permits small consignments of counterfeit or pirated non-perishable goods232 to be destroyed by Customs, without the specific involvement of the right holder, provided, however, that the latter has opted in to consent to the use of this simplified procedure when filing its application for action by customs authorities, and that no opposition is raised by the declarant or holder of the goods within ten working days of notification of the detention. If the declarant or holder raises an objection to the destruction, the right holder will have to commence court proceedings to require the delivery-up and destruction of the goods. The existing legal framework on customs enforcement of IPRs was thus modified to adapt to the changes brought about by the growth of e-commerce and the consequent development of express freight systems, and to reduce the administrative burden and costs relating to increased trade in fakes in small consignments purchased on the internet. The Regulation defines ‘small consignment’ as a postal or express courier consignment that contains three units or less or has a gross weight of less than two kilograms.233 However, it provides for a mechanism allowing for rapid amendment of this definition to adapt to new trends in the future.234 21.81 For all other goods, which are neither part of a small consignment, are not counterfeit or pirated goods in the narrow sense of the Regulation or are perishable, the right holder will only be able to have the goods destroyed with the declarant’s or holder’s express agreement – Customs ‘may’ also agree to have the goods destroyed based on the declarant’s or holder’s failure to reply – or as a result of court proceedings.235 21.82 In either case, when the declarant or holder does oppose destruction, court proceedings have to be instituted at short notice by the right holder, otherwise Customs will have to release the goods.236

229 230

Regulation 608/2013, Art. 22. See n 5 above. Art. 69 provides that: Members agree to cooperate with each other with a view to eliminating international trade in goods infringing intellectual property rights. For this purpose, they shall establish and notify contact points in their administrations and be ready to exchange information on trade in infringing goods. They shall, in particular, promote the exchange of information and cooperation between customs authorities with regard to trade in counterfeit trademark goods and pirated copyright goods.

231 232

Regulation 608/2013, Art. 26. Not all goods infringing a trademark, copyright or related right, or a design can be considered as ‘counterfeit’ or ‘pirated’. For the definition of ‘counterfeit goods’ and ‘pirated goods’, see Regulation 608/2013, Arts 2(5) and 2(6), respectively. ‘Pirated goods’ are defined as being: goods which are the subject of an act infringing a copyright or related right or a design in the Member State where the goods are found and which are, or contain, copies, made without the consent of the holder of a copyright or related right or a design, or of a person authorised by that holder in the country of production (emphasis added).

233 234 235 236

See, by analogy, the comment on Art. 2(1)(b) of Regulation 1383/2003 in n 215 above. Regulation 608/2013, Art. 2(19). Ibid., Art. 26(10). Ibid., Art. 23. Ibid., Arts 23(5) and 24(9).

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At Customs’ request, the storage and destruction costs resulting from the application of the above 21.83 destruction procedures have to be borne by the right holders,237 who are, however, expressly entitled to seek compensation for these costs from the infringer.238 The new Regulation also clarifies that, among other things, right holders may use information 21.84 provided by Customs concerning the consignor and consignee of the goods, not only to initiate civil infringement proceedings or to obtain consent for destruction, but also as a basis for criminal proceedings and to seek compensation.239 For the sake of completeness, it should be noted that, on 10 December 2012, anticipating the 21.85 adoption of Regulation 608/2013, the Council adopted the new Customs Action Plan to combat IPR infringements for the years 2013–2017.240 This Action Plan mandated the Commission to prepare a detailed roadmap in cooperation with Member States’ experts to define the actions and tools to be deployed in the coming years. Like the Customs Action Plan 2009–2012,241 the 2013–2017 Action Plan also aimed to develop tailor-made approaches for dealing with small consignments of counterfeit and pirated goods, as well as the exchange of best practices on the customs follow-up of internet trade, and to strengthen customs risk management. A major chapter of the Action Plan aimed to better tackle the trade of goods infringing IPR throughout the international supply chain, by strengthening cooperation with key source, transit and destination countries (by reinforcing customs cooperation on IPR with third countries;242 the sharing of information with third countries; etc.). The outcomes of the implementation of the Action Plan 2013–2017 are reflected in the dedicated report that the Commission services prepared in cooperation with the Member States.243 In 2018, the Customs Action Plan 2013–2017 was reconfigured for the five subsequent years. The 21.86 strategic objectives of the new Customs Action Plan 2018–2022244 essentially remain unchanged, i.e.: ensuring effective customs enforcement of IPR throughout the EU, tackling major trends in trade of IPR-infringing goods (amongst others by developing tailor-made approaches for parcel and postal traffic), and tackling trade in IPR-infringing goods throughout the international supply chain (inter alia, by strengthening cooperation with key source, transit and destination countries).

237 238 239 240

241 242

243 244

Ibid., Art. 29(1). Ibid., Art. 29(2). Ibid., Art. 21. Council Resolution on the EU Customs Action Plan to combat IPR infringements for the years 2013–2017 [2013] OJ C80/1. See also Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee ‘Developing the EU Customs Union and Its Governance’, COM(2016) 813 final. See para. 21.73 above. On 16 May 2014, the Commission and the General Administration of China Customs (‘GACC’) signed an Action Plan concerning EU-China Customs Cooperation on IPR (2014–2017) as one of the priorities of the EU-China Strategic Framework for Customs Cooperation (2014–2017) that was signed on the same day. It made it possible to resume the operational cooperation between the Commission services and the representatives of the 16 seaports and airports in the EU on the one side, and the GACC and representatives from 11 local Chinese customs offices, on the other side. A new Strategic Framework for Customs Cooperation covering the period 2018–2020 was signed on 2 June 2017, which includes a new Action Plan of Customs Cooperation on IPR for the years 2018–2020. The Commission and the Customs and Excise Department of Hong Kong, China, also signed an Action Plan on cooperation in the customs enforcement of IPR on 27 April 2015. This Action Plan focuses on the sharing of general risk information, detention statistics on IPR-infringing goods and case-specific information, and foresees the joint analysis of such data to improve customs risk management. See Report from the Commission to the Council and the European Parliament on the implementation of the EU Customs Action Plan to combat IPR infringements for the years 2013–2017, COM(2018) 77 final, p. 8. Report on the implementation of the EU Customs Action Plan to combat IPR infringements for the years 2013–2017, ibid. Council Conclusions on the EU Customs Action Plan to combat IPR infringements for the years 2018–2022 [2009] OJ C24/3.

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21.87 A key objective of the Action Plan is to ensure the effective implementation and monitoring of Regulation 608/2013 (e.g., through e-learning tools and training courses245). In that framework, the Commission advocates the development of a partnership with the European Observatory on Infringements of IPR246 and enhanced cooperation with OLAF and European enforcement agencies other than Customs. The Action Plan also aims to develop tailor-made approaches for dealing with small consignments of counterfeit and pirated goods, as well as the exchange of best practices on the customs follow-up of internet trade, and to strengthen customs risk management. A major chapter of the Action Plan aims to better tackle trade in goods infringing IPRs throughout the international supply chain, by strengthening cooperation with key source, transit and destination countries (reinforcement of customs cooperation on IPRs with third countries, in particular China and Hong Kong;247 sharing of information with third countries; etc.).

C. Criminal enforcement of copyright and related rights 21.88 In the EU, since the creation of the European Customs Union, frontiers have ceased to be obstacles to trade in counterfeit and pirated goods by organised criminals, while they remain as barriers to investigators and magistrates.248 The links between organised crime and piracy and counterfeiting have repeatedly been pointed out over the last decades.249 Links between intellectual property crime and other criminality such as drug-trafficking, human trafficking, facilitation of illegal migration, weapon trafficking, excise and VAT fraud, document fraud, money laundering, and corruption, are well documented.250 Whilst piracy and counterfeiting are often seen as ‘victimless crimes’, Europol reports that coercion and violence are regularly used to force retailers to sell illegal products or force the victims of labour exploitation to work in the production and/or distribution of these goods.251 Since piracy and counterfeiting are high-profit crime areas, organised crime groups, such as the Chinese triads, the Japanese, Russian, Turkish, and Albanian mafias, and the Italian Camorra, are reportedly increasingly involved in the manufacture and/or distribution of counterfeit and pirated goods.252 21.89 In 2005, the Commission issued a proposal for a Directive aimed at harmonising the levels of penalties for intellectual property crime at the EU level (also known as ‘IPRED2’).253 It suggested

245 246 247 248 249

250

251

252

253

An e-learning course on the application of Regulation 608/2013 was made available on DG TAXUD’s website in December 2013: . See below, paras 21.98–21.119. See further below, para. 21.260, as regards the EU-China Customs Action Plan. Godart, n 25 above, paras 2.01–2.03. See Parliament resolution of 9 June 2015 ‘Towards a renewed consensus on the enforcement of Intellectual Property Rights: An EU Action Plan’ [2016] OJ C407/03 (point B). On this subject, see also, e.g., G.F. Treverton et al, Film, Piracy, Organized Crime, and Terrorism (2009), . Europol & EUIPO, 2015 Situation Report on Counterfeiting in the European Union, , pp. 44–45; 2017 Situation Report on Counterfeiting and Piracy in the European Union, , pp. 39–41; Europol, SOCTA 2017: EU Serious and organised crime threat assessment, , p. 36. EUIPO & Europol, Intellectual Property Crime Threat Assessment 2019, , p. 24. See, on this subject, Godart, note 25 above, paras 27–48; T. Phillips, Knockoff: The Deadly Trade in Counterfeit Goods, Kogan Page, 2005; R. Saviano, Gomorrah: Dans l’empire de la Camorra, Gallimard, Paris, 2007, 53–78. See also the testimony under oath given on 16 July 2003 by Mr Ronald K. Noble, Secretary-General of Interpol, to the US House Foreign Relations Committee, The Link between Intellectual Property Crime and Terrorist Financing; P. Lowe, ‘Counterfeiting: links to organized crime and terrorist funding’ (2006) J. Fin. Crime 13, 255. Proposal for a European Parliament and Council Directive on criminal measures aimed at ensuring the enforcement of intellectual property rights and proposal for a Council Framework Decision to strengthen the criminal legal framework to combat intellectual property offences of 12 July 2005, COM(2005) 276 final. This proposal was revised in 2006: see

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that deterrent criminal sanctions be imposed on both natural and legal persons intentionally committing or attempting to commit IPR infringements. The range of sanctions included terms of imprisonment, fines, the seizure of criminal proceeds and other property belonging to infringers, and the closure of businesses for commercial-scale infringements or the involvement of organised crime groups, or where risks to health or security had been established. The proposal also sought to allow for ex officio investigations and prosecutions, while mandating that the right holders be allowed involvement in any investigations. The initial proposal which eventually resulted in the adoption of Directive 2004/48/EC (the ‘IPRED’ or ‘IPRED1’ Directive) contained similar provisions on criminal sanctions, but these were eventually omitted from the final text of the Directive. The draft IPRED2 only dealt with commercial-scale infringements, but was criticised due to the 21.90 lack of definition of ‘commercial scale’. Thus, the Max Planck Institute, for example, regretted that restricting the application of the Directive to infringements carried out ‘on a commercial scale’ would have failed to provide for an appropriate and sufficiently precise definition of the elements of a crime.254 This criticism should then also apply, mutatis mutandis, to the TRIPS Agreement, which does not contain a definition of ‘commercial scale’ either. This concept was eventually defined, 15 years after the adoption of TRIPS, by the WTO Dispute Settlement Panel in the US v. China case, as referring to any ‘typical or usual commercial activity with respect to a given product in a given market’.255 The European Parliament adopted its position, amending the Commission proposal, on 25 April 21.91 2007,256 calling for the new Directive not to apply to goods infringing patent rights,257 to parallel imports of genuine goods, or to ‘acts carried out by private users for personal and not-for-profit purposes’.258 The proposal failed to gain political support. It was considered by some to be disproportionate and 21.92 vague. The Commission’s competence to harmonise criminal law in the Member States under the EU Treaty was questioned by several governments. The reluctance on the part of several Member States to approve the draft Directive explains why the latter never made it through the Council. In February 2008, Socialist MEP Nicola Zingaretti, who was in charge of the adoption of the new rules in the European Parliament, urged Member States to adopt the draft Directive in order

254

255 256 257

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Amended proposal for a Directive of the European Parliament and of the Council on criminal measures aimed at ensuring the enforcement of intellectual property rights, COM(2006) 168 final. On this subject, see the article published by an EU Commission’s expert at the time, D. Fontanaud, ‘Counterfeiting and piracy: towards European criminal legislation to combat the penetration of organized crime’ (2005) The European Files 20. See also M. Schneider and O. Vrins, ‘The EU offensive against IP offences: should right-holders be offended?’ (2006) JIPLP 173–5. R. Hilty, A. Kur and A. Peukert: ‘Stellungnahme des Max-Planck-Instituts für Geistiges Eigentum, Wettbewerbs- und Steuerrecht zum Vorschlag für eine Richtlinie des Europäischen Parlaments und des Rates über strafrechtliche Maßnahmen zur Durchsetzung der Rechte des geistigen Eigentums, KOM(2006)168 endgültig’ (2006) GRUR Int 722 (see para. 14). China – Measures Affecting the Protection and Enforcement of Intellectual Property Rights, WT/DS362/R,09/0240, 26.01.2009. P6_TA(2007)0145. By contrast, in some emerging economies which are traditionally hostile to intellectual property (such as, e.g., Argentina, Brazil, and Thailand), patent infringement is subject to criminal sanction: cf. the report commissioned by the EU Commission on the ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’ (November 2010), p. 44, . The Parliament declared in this respect that ‘fair use of a protected work, including such use by reproduction in copies or audio or by any other means, for purposes such as criticism, comment, news, reporting, teaching (including multiple copies for classroom use), scholarship or research, does not constitute a criminal offence’.

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to address the ‘increasingly systematic violation of copyright by some Internet users’,259 to no avail. The proposal was eventually withdrawn by the Commission.260 21.93 Since the entry into force on 1 December 2009 of the Lisbon Treaty amending the Treaty on European Union and the Treaty establishing the European Community,261 however, it has become clear that either the EU or the Member States may legislate and adopt legally binding acts with regard to criminal measures. Under Chapters 4 and 5 of Title V of Part III of the Treaty on the Functioning of the European Union (TFEU), the European Parliament and the Council may adopt measures in the field of judicial and police cooperation in criminal matters. Article 83(1) TFEU262 states that they may establish minimum rules concerning the definition of criminal offences and sanctions, by means of Directives, in specific areas. In addition, Article 83(2) provides that: [i]f the approximation of criminal laws and regulations of the Member States proves essential to ensure the effective implementation of a Union policy in an area which has been subject to harmonisation measures, directives may establish minimum rules with regard to the definition of criminal offences and sanctions in the area concerned. […].

According to Article 4(2)(j) TFEU, the area of Freedom, Security and Justice falls under the shared competence263 of the Union and its Member States and is, therefore, subject to the subsidiarity principle. Recent developments suggest that the EU is eager to legislate in criminal matters in the future.264 21.94 In its Resolution of 1 March 2010, the Council invited the Commission to investigate the possibility of submitting a new proposal for a Directive on criminal sanctions against counterfeiting and piracy.265 On 30 November 2010, on the occasion of the Belgian Presidency of the EU, the Belgian Federal Public Services of Economy and of Justice and the Commission organised a conference, which addressed the need to ensure a more effective enforcement of IPRs. The programme reaffirmed that this objective was directly linked with the priorities set out in the ‘Europe 2020 Strategy’.266 21.95 The lack of harmonisation of the level of penalties for counterfeiting and piracy in the Member States significantly hinders interstate police cooperation, because the law enforcement agencies are deprived of the possibility of applying special investigation techniques, such as telephone tapping, infiltration techniques, test purchases or controlled deliveries, or to issue arrest warrants. The European Search Warrant, for example, applies for offences punishable by imprisonment or a detention order for a maximum period of at least one year.267 In several Member States, the level of penalties in cases of counterfeiting and piracy is so low that arrest warrants are not available for such

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Written question to the Council (5 February 2008), . [2010] OJ C252/7. [2007] OJ C306/1. See consolidated version of the Treaty on the Functioning of the European Union [2010] OJ C83/47. As defined in Art. 2(2) TFEU. Cf. e.g., Council Decision of 9 December 2013 on the signing, on behalf of the European Union, of the Protocol to Eliminate Illicit Trade in Tobacco Products to the World Health Organization’s Framework Convention on Tobacco Control, as regards its provisions on obligations related to judicial cooperation in criminal matters, the definition of criminal offences, and police cooperation [2013] OJ L333/73. Resolution of 1 March 2010 (n 60 above), para. 32. Communication from the Commission of 3 March 2010 ‘Europe 2020: A European strategy for smart, sustainable and inclusive growth’, COM(2010) 2020. Council Framework Decision 2002/584/JHA of 13 June 2002 on the European arrest warrant and the surrender procedures between Member States [2002] OJ L190/1. See also Council Framework Decision 2009/299/JHA of 26 February 2009 amending Framework Decisions 2002/584/JHA, 2005/214/JHA, 2006/783/JHA, 2008/909/JHA and 2008/947/JHA, thereby enhancing the procedural

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offences. The lack of harmonisation as regards criminal enforcement of IPRs, including the diversification of the definitions of the crimes involved and of the investigative techniques used, in addition to the lack of understanding of the phenomenon of counterfeiting and piracy by some public prosecutors in several Member States, also affects the credibility of the EU towards its contract partners.268 How can the EU seriously expect its trade partners, when negotiating bilateral agreements, to provide for harsh criminal sanctions for IPR infringements in their national laws, if it is unable to convince its own Member States of the opportunity of such measures? The 2010 report on the evaluation of the IPR Enforcement Strategy in Third Countries therefore advocated that EU harmonisation be increased, inter alia, in this area.269

2. Non-legislative actions In its Communication of 11 September 2009,270 the Commission proposed to supplement the 21.96 existing regulatory framework on IPR enforcement with complementary non-legislative measures, in line with the Council Resolution of 25 September 2008 on a Comprehensive European Anti-Counterfeiting and Anti-Piracy Plan.271

A. Stakeholders’ dialogues In 2009, the Commission published a first set of non-legislative tools to supplement existing 21.97 legislation.272 Among other initiatives, it prompted and facilitated dialogues among stakeholders, aimed at creating jointly agreed voluntary measures – in compliance with the existing legal framework – to reduce counterfeiting and piracy. This new and innovative approach was welcomed by the Council in its Resolution of 1 March 2010, which invited the Commission, the Member States and the stakeholders to continue their dialogues and to seek agreements on voluntary practical measures aimed at reducing counterfeiting and piracy in the Internal Market, both online and offline.273 Further, the Commission was invited, in cases where stakeholders’ dialogues proved unable to reach agreed solutions, to make proposals for appropriate follow-ups, ‘including proposals for legislation, if necessary and appropriate’.274 The European Parliament also offered its support for the Commission’s actions in its Resolution of 22 September 2010.275 It encouraged the Commission, the Member States and the stakeholders to continue their dialogues at various levels, to organise awareness-raising campaigns about the economic and social consequences of IPR infringements and to sign voluntary cooperation agreements to help reduce counterfeiting and piracy, both online and offline. The ‘Stakeholders’ Dialogues’ take place under the auspices of the European Commission, which acts as a neutral facilitator by providing administrative and logistic support and by safeguarding a fair balance between the different interests at stake.

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rights of persons and fostering the application of the principle of mutual recognition to decisions rendered in the absence of the person concerned at the trial [2009] OJ L81/24. ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’, n 19 above, 61. Ibid., 72. See n 9 above. See n 42 above. Commission Communication of 11 September 2009 (n 9 above). Council Resolution of 1 March 2010 (n 60 above), paras 39–40. Ibid., para. 42. Stakeholders’ dialogues have thus far primarily been relied on to address online piracy and counterfeiting: see paras 21.196–21.198 below in this regard. Resolution 2009/2178(INI) on enforcement of intellectual property rights in the internal market [2012] OJ C50 E/48.

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B. The European Observatory on Infringements of Intellectual Property Rights 21.98 As mentioned above,276 the creation of a ‘European Observatory on Counterfeiting and Piracy’ was first advocated by the European Council in its Resolution of 25 September 2008 on a Comprehensive European Anti-Counterfeiting and Anti-Piracy Plan.277 It was effectively launched on 2 April 2009 under the auspices of the Commission, which hosted its meetings and administered its work. The tasks of the Observatory were initially defined in the Commission Communication of 11 September 2009 ‘Enhancing the enforcement of intellectual property rights in the internal market’. Those included supporting and facilitating the enforcement of IPRs, coordinating enforcement strategies, bringing together experts from the public and private sectors, and, last but not least, assemble comprehensive databases to help develop priorities and target enforcement more effectively, ‘and thus pave the way for better collaboration and evidence-based policies’.278 21.99 The Communication of 11 September 2009 was enthusiastically welcomed by the Council in its Resolution of 1 March 2010 ‘on the enforcement of intellectual property rights in the internal market’.279 There, the Council invited the Commission to elaborate further on the scope of the competences, tasks and role of the Observatory, supporting its activity through existing institutional structures.280 It further emphasised the importance of reliable and comparable data on counterfeiting and piracy and invited the Commission, the Member States and businesses to provide the Observatory with information and to jointly develop and agree, in the context of the Observatory, plans to collect further information and to jointly develop a common method for collecting data.281 21.100 Three working groups (called ‘Sub-groups’) were set up within the European Observatory on Counterfeiting and Piracy, i.e., one on the legal framework, one on data gathering, and one on awareness-raising. 21.101 The Legal Sub-group, which was initially composed of Commission representatives and external counsels active in the field of intellectual property, set as its first objective an in-depth study of the national law in each Member State implementing the IPRED, so as to reveal the problems encountered by stakeholders in their enforcement of IPRs. This Sub-group was also called upon to identify and spread best practice strategies and enforcement techniques from both the public and private sectors. Four comprehensive reports were produced tackling these issues (on damages,282 corrective measures,283 evidence,284 and injunctions285). 21.102 The Sub-group on raising public awareness, from its side, organised awareness-raising campaigns – such as the ‘REAL Fake’ competition for schools across the whole EU, which was organised in the European Parliament in 2010, and the ‘Hands Off My Design’ competition, which ended on 1 February 2012. 21.103 Finally, the Sub-group on statistics assisted in the preparation of a comprehensive study launched in March 2010 aiming to quantify the scope and impact of counterfeiting and piracy in the EU. One

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See para. 21.23. See n 42 above. Commission Communication of 11 September 2009 (n 9 above), 5. See n 60 above. Ibid., para. 24. Ibid., para. 28. See n 157 above. See n 178 above. . .

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of the Observatory’s main goals is, indeed, to collect independent data on counterfeiting and piracy and thus to improve the quality of the information available on the scope of the impact of these phenomena in the EU. The European Observatory on Counterfeiting and Piracy was to become the central resource for gathering, monitoring and reporting information and data related to IPR infringements. With this aim in mind, the Observatory was asked to develop a benchmark, replicable method of collecting independent data on the scope, scale and impact of IPR infringements in the EU (this became known as the ‘RAND’ method286) which should then be aggregated objectively and in a balanced manner. As early as in its Conclusions of 20 November 2008 on the development of legal offers of online cultural and creative content and the prevention and combating of piracy in the digital environment,287 the Council had already invited the Commission to compile statistical data in order to improve awareness of piracy, and of its causes and consequences for the creative and cultural sectors and for the economy in general. The Observatory’s lack of financial, human and IT resources eventually prompted the Commission 21.104 to reconsider its structure. In its Conclusions of 25 May 2010 on the future revision of the trademark system in the EU,288 the Council called on the Commission to establish a legal basis for the involvement of the Office for Harmonisation in the Internal Market (Trade Marks and Designs) (OHIM) in enforcement-related activities, in particular through cooperation with the national trademark offices in the Member States and the Observatory. This recommendation was backed by the European Parliament in its Resolution of 22 September 21.105 2010 on the enforcement of IPRs in the internal market.289 On 18 April 2011, the Commission and the OHIM signed a Memorandum of Understanding, which followed-up these calls. Under this MoU, the Commission remained in charge of the Observatory’s policy and regulatory work – including the Sub-groups – while the OHIM provided expert technical and practical support in relation to trademarks and designs. On 24 May 2011, the Commission proposed, in its Communication entitled ‘A Single Market for 21.106 Intellectual Property Rights’290 to redefine the Observatory’s structure and tasks. On the same day, it also released a Proposal to transfer full responsibility for the Observatory to the OHIM,291 which was adopted on 19 April 2012.292 The OHIM was thus entrusted with specific tasks related to the enforcement of IPRs, while the Observatory was renamed the ‘Observatory on Infringements of Intellectual Property Rights’ and its activities were broadened from the fight against ‘counterfeiting’ and ‘piracy’ to include infringements of all the IPRs covered by the IPRED.293

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See below, para. 21.114, in this regard. See n 77 above. [2010] OJ C140/22. See n 275 above. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions ‘A Single Market for Intellectual Property Rights. Boosting Creativity and Innovation to Provide Economic Growth, High Quality Jobs and First Class Products and Services in Europe’ (n 91 above). Proposal for a Regulation of the European Parliament and the Council on entrusting the Office for Harmonisation in the Internal Market (Trade Marks and Designs) with tasks related to the enforcement of intellectual property rights, including the assembling of public and private-sector representatives as a European Observatory on Infringements of Intellectual Property Rights, COM(2011) 288 final. Regulation (EU) No 386/2012 of the European Parliament and of the Council of 19 April 2012 on entrusting the Office for Harmonisation in the Internal Market (Trade Marks and Designs) with tasks related to the enforcement of intellectual property rights, including the assembling of public and private-sector representatives as a European Observatory on Infringements of Intellectual Property Rights [2012] OJ L129/1. In force since 5 June 2012. See above, para. 21.41, in this regard.

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21.107 An Observatory Department was created within the OHIM in October 2012, which comprises: (i) the Observatory Operations and Projects Area, responsible for the identification and implementation of the projects and studies of the new Observatory and interaction with stakeholders; (ii) the Academy Area, responsible for organisation of training activities with the National Offices and other stakeholders, implementation of the Observatory’s training activities, and implementation of learning activities for the OHIM’s staff; and (iii) a Chief Economist, responsible for all activities related to economic studies and statistical analyses to be performed in the framework of the Observatory’s activities. 21.108 As it stands today, the European Observatory on IPR Infringements is a platform for representatives of the public and private sectors from across the EU, the Commission, and the European Parliament. It is thus a paradigm of public–private partnership (PPP) at the EU level. Its private-sector members include representatives of several sectors, including the creative industries (authors and other right holders) and SMEs, internet intermediaries, and consumer associations.294 21.109 The tasks and goals of the new Observatory were defined in the light of the results of a public consultation to identify the main issues and priorities that intellectual property will face in the near future and how to address them. The major challenges indicated by the respondents to the survey related to the constant increase in IPR infringements (especially on the internet), the lack of relevant and reliable data about the value and infringements of such rights, as well as the lack of intelligence-gathering tools and the devaluation of intellectual property among consumers. 21.110 The results of this consultation allowed the OHIM to design the Observatory’s Work Programme 2013.295 The current and future activities of the ‘new’ Observatory were discussed during the first plenary meeting in September 2012. Having regard to the challenges identified by the respondents, the OHIM defined four priorities, namely: (i) supporting policy-making by providing researchbased evidence; (ii) supporting enforcement bodies by providing intelligence, knowledge, tools and techniques; (iii) supporting businesses and right holders to improve their strategies with knowledge and tools; and (iv) raising awareness among all relevant players and improving understanding of the value of intellectual property.296 Consistent with these priorities, the main tasks of the new Observatory were defined as follows: (i) to assess and highlight problems in specific areas and sectors; (ii) to make recommendations to policy-makers; (iii) to foster cooperation between the public and private sectors (notably with respect to the training of enforcement agencies); (iv) to exchange ideas and expertise on best practices; (v) to promote and spread such best practices among public authorities; and (vi) to develop joint enforcement strategies.297 21.111 Regulation 386/2012 defines the tools available to the Observatory to enable it to achieve its objectives. Those include awareness-raising campaigns, training programmes for enforcement authorities (police, Customs, and public prosecutors) – including in third-party countries, e-learning modules on enforcement strategies, investigation, tracking and tracing techniques to identify fakes, databases allowing stakeholders and law enforcement officials to share information, and MoUs – inter alia, to tackle illegal file sharing on the internet.298 The Regulation also advocates

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Regulation 386/2012, Art 4. Ibid., Art. 7 stipulates that the OHIM will draw up an annual Work Programme prioritising the activities and the meetings of the Observatory in line with the Union’s policies in the field of protection of IPRs. Specifically, Art. 7(1) states that this Work Programme will be drawn up in cooperation with the representatives from the public administrations, bodies and organisations in the Member States. European Observatory on Infringements of Intellectual Property Rights, Work Programme 2013, , 12. Ibid., 17. Regulation 386/2012, Art. 2.

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the proactive exchange of statistics on infringements of IPRs between the Observatory, the Member States, and stakeholders. It also gives the Observatory a role in defining overall policy and strategies, and in reviewing relevant case law.299 In December 2012, five Working Groups were formally set up as part of the new structure to meet these objectives (i.e., Statistics and Economics, Legal and International, Public Awareness, Enforcement, and IP in the Digital World). In October 2013, the Observatory released the results of a study on the contribution of intellectual 21.112 property intensive industries to the economy300 and a study on the perception of intellectual property by European citizens301 aiming to provide guidance for the development of future awareness campaigns and to measure over time the impact of such campaigns. The former study was updated in 2016302 and 2019303 with the help of the European Patent Office, while the latter was updated in 2017.304 They will both be repeated every three years to measure the impact of the Observatory’s activities. The Observatory is also developing guides for EU businesses operating in third countries to help them with protecting their IPRs. The six countries which are covered so far are: Brazil, Russia, India, China, Ukraine, and Turkey.305 The guides, which will in principle be updated at least every two years, are expected to be used by the European Commission’s DG TRADE in its compilation of reports on IPR enforcement in third countries and in dialogues with these countries. The Observatory has also been entrusted with the implementation of EU funded technical cooperation programmes such as IP Key in non-EU countries.306 The Observatory has no legal personality. It is not an enforcement agency. Neither has it any 21.113 legislative powers – although it can make proposals to the Commission for intellectual propertyrelated legislation. Its seat is in the EUIPO (formerly known as OHIM) in Alicante. The first meetings of the Observatory’s Working Groups took place in February, April, June and September 2013 in Brussels. Many non-EU countries are watching closely the development of the Observatory, particularly as 21.114 regards the availability of reliable statistics on counterfeiting and piracy.307 On 27 September 2012, the RAND Europe report ‘Measuring IPR infringements in the internal market’ was presented by the Commission and RAND – an external contractor – to the inaugural plenary meeting of the brand new European Observatory on Infringements of Intellectual Property Rights in Alicante.308 During the first ‘Enforcement’ Working Group meeting on 20 February 2013, several stakeholders 21.115 regretted that the Observatory’s Work Programme 2013 did not dedicate any training session or other event specifically to copyright and related rights infringements. In April 2013, however, a Sub-group on ‘Online Copyright Infringements’ was established within the ‘IP in the Digital World’ Working Group, which aimed to build greater knowledge and understanding about existing legal business models and to depict the scope of online copyright infringing models. This

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Ibid., Art. 5. See n 11 above. ‘European Citizens and Intellectual Property: Perception, Awareness and Behaviour’ (November 2013), . . . . . See below, para. 21.262, in this regard. ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’, n 19 above, 37–8. The report can be accessed via the following link: .

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Sub-group has been tasked with drafting a report providing EU and national policy-makers and enforcement actors with information related to online infringements in areas protected by copyright.309 The Observatory has also been entrusted with the monitoring of a number of MoU concluded in the framework of Stakeholders’ Dialogues in this field.310 It further helps to raise awareness among consumers about the availability of legal offers in the different copyright areas.311 The Observatory has also developed a single EU database on orphan works, shared by all the Member States, according to Directive 2012/28/EU.312 21.116 At the time of writing this chapter, the Observatory on Infringements had completed a picture of the economic impact of counterfeiting in a dozen economic sectors across the EU;313 12 reports were released between January 2015 and February 2018, focusing on watches and jewellery,314 luggage and handbags,315 geographical indications for wine, spirits, agricultural products, and foodstuffs,316 the wine and spirits sector,317 medicines,318 pesticides,319 tyres and batteries,320 the clothes, shoes, and accessories sector,321 the sports goods sector,322 the cosmetics and personal care

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For more information regarding the composition of the ‘Online Copyright Infringements’ Sub-group, its preliminary findings and its work programme, see . See paras 21.196–21.198 below. See . The IP perception studies conducted at the Observatory’s initiative (cf. n 301 and 304 above) shows that the existence and awareness of legal offers might have an influence on illegal downloading activities: the majority of the respondents said that, whenever there is an affordable legal option they prefer to access/download/stream content through authorised platforms and not to do it illegally. See . EUIPO, 2019 Status Report on IPR Infringement, . The Economic Cost of IPR Infringement in Jewellery and Watches (February 2016), . The Economic Cost of IPR Infringement in Handbags and Luggage (February 2016), . Infringement of Protected Geographical Indications for Wine, Spirits, Agricultural Products, and Foodstuffs in the European Union (April 2016), . The Economic Cost of IPR Infringement in Spirits and Wines (July 2016), . The Economic Cost of IPR Infringement in the Pharmaceutical Industry (February 2017), . The Economic Cost of IPR Infringement in the Pesticide Sector (February 2016), . The Economic Cost of IPR Infringement in the Tyres and Batteries Sectors (February 2018), . The Economic Cost of IPR Infringement in the Clothing, Footwear and Accessories Sector (June 2015), . The Economic Cost of IPR Infringement in Sports Goods (September 2015), .

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items sector,323 the toys and games sector,324 smartphones,325 and the recorded music industry.326 In this last area, the researchers concluded that, in 2014 the recorded music industry lost approximately €170 million of sales revenue in the EU due to recorded music’s consumption from illegal sources. This loss accounts for 5.2 per cent of the sector’s revenues from physical and digital sales. These lost sales are estimated to result in direct employment losses of 829 jobs. If the knock-on effects on other industries and on government revenue are factored in, then infringement of IPR in this sector causes approximately €336 million of lost sales to the EU economy, which in turn leads to employment losses of 2,155 jobs and a loss of €63 million in government revenue. Recorded music industry sales include the wholesale value of the sale/licensing of recorded music products to domestic retailers/intermediaries. Revenues from music distributors and retailers are therefore not included here. Those sectoral studies have been updated in a ‘2019 Status Report on IPR Infringement’ released by 21.117 the EUIPO, in order to reflect the most recent data available.327 This report, which includes updated figures for the period 2012–2016 and builds on a ‘Synthesis Report’ published in 2018328 and will be updated on an annual basis, brings together the findings of the research carried out by the Observatory since 2013, tying together earlier studies on the value of intellectual property, the mechanisms used to infringe IPRs and the economic consequences of infringements. It also includes a section on the actions being taken to combat such infringements. On 27 November 2019, the EUIPO also published two reports on online copyright and related 21.118 rights infringements. The report on ‘Illegal IPTV in the European Union’ estimates that the unlawful revenue generated by illegal IPTV in 2018 amounted to 941.7 million euro and that these services were used by nearly 14 million people in the EU. It also provides an insight into the technical aspects, complex supply chains and legal issues involved by this phenomenon, and covers related case law.329 The report on ‘Online Copyright Infringement in the European Union’ analyses consumption of copyright-infringing music, films and TV programmes in the Member States. It covers both fixed and mobile devices, as well as the main methods of access (streaming, downloading, torrenting, and stream ripping). It appears from this study that, even though, between 2017 and 2018, access to pirated content decreased by 15 per cent overall, piracy remains a significant problem. It seeks to explain why the issue is more acute in some Member States than others by analysing some of the socio-economic, demographic and other factors that could influence consumption of pirated content.330

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The Economic Cost of IPR Infringement in the Cosmetics and Personal Care Sector: Report of a Pilot Study (March 2015), . The Economic Cost of IPR Infringement in Toys and Games (December 2015), . The scope of this report does not include video game consoles, software for video games or bicycles. The Economic Cost of IPR Infringement in the Smartphones Sector (February 2016), . The Economic Cost of IPR Infringement in the Recorded Music Industry (May 2016), . EUIPO, 2019 Status Report on IPR Infringement, . EUIPO, Synthesis Report on IPR Infringement 2018 (June 2018), . . .

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21.119 Real-time information concerning the nature and progress of the Observatory’s work can be found on the following page: .

C. The fight against intellectual property crime: policial and judicial cooperation 21.120 The failure of the proposal for a Directive on criminal measures aimed at ensuring the enforcement of IPRs led the European Commission to turn instead to various mutual-assistance tools to tackle intellectual property crime on the ground. Criminal enforcement of IPRs is governed by the national law of the Member States. In a globalised economy, the co-existence of 27 legal systems makes interstate cooperation more important than ever. In recent years, the Commission has adopted a number of initiatives, in close collaboration with the law enforcement agencies of the Member States, Europol, and Interpol, aimed at curbing IPR infringements committed by organised crime groups. i.

Police cooperation: Europol

21.121 The European Police Office (Europol) has been called on to play an increasing role in this field in recent years. It was set up under the Treaty of the European Union of 7 February 1992. Its activities were initially governed by the Europol Convention,331 which was amended by three protocols that entered into force after a lengthy ratification process. In order to make the introduction of future amendments easier, the Europol Convention was repealed by a Council Decision of 6 April 2009,332 that was in turn replaced as of 1 May 2017 by Regulation (EU) 2016/794 so as to enhance Europol’s role as a European law enforcement agency, to reinforce personal data protection and increase Europol’s accountability to the European Parliament and national parliaments and to ensure the quality and coherence of the training offered to frontline officers.333 As it stands now, Europol is an autonomous institution of the EU with its own legal personality and funded from the EU general budget, responsible for law enforcement cooperation at the EU level. Its objective is to support and strengthen actions by police and other law enforcement agencies in the Member States and to develop their cooperation in preventing and combating organised crime, terrorism, and other serious crimes affecting two or more Member States, as listed in the Annex to the Decision. ‘Counterfeiting and product piracy’ are explicitly included in this Annex. 21.122 Europol can be a party to legal proceedings. Its duties include providing support to the Member States in the gathering and analysing of information from the internet in order to assist in the identification of criminal activities facilitated by, or committed using, the Web. 21.123 An operational intellectual property crime project was set up by Europol in January 2008 to counter the growing involvement of organised crime in counterfeiting and piracy. This project involves close cooperation between, and on occasion joint operations by, Europol, the International Criminal Police Organisation (Interpol), the US Immigration and Customs Enforcement (ICE), the

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Convention based on Art. K.3 of the Treaty of the European Union, on the establishment of a European Police Office [1995] OJ C316/1. Council Decision 2009/371/JHA establishing the European Police Office (Europol) [2009] OJ L121/37. Reference should also be made here to the European Police College (CEPOL), which was initially set up by a Council Decision 2000/820/JHA of 22 December 2000 (Council Decision of 22 December 2000 establishing a European Police College [2000] OJ L336/1) and was established as an EU agency in 2005 (Council Decision 2005/681/JHA of 20 September 2005 establishing the European Police College (CEPOL) and repealing Decision 2000/820/JHA [2005] OJ L256/63). CEPOL is in charge of activities related to the training of law enforcement officers. It aims to facilitate cooperation between national police forces by organising courses with a European policing dimension. It defines common curricula on specific topics, disseminates relevant research and best practice, coordinates an exchange programme for senior police officers and trainers, and may act as a partner in EU grants for specific projects. Regulation (EU) 2016/794 of the European Parliament and of the Council of 11 May 2016 on the European Union Agency for Law Enforcement Cooperation (Europol) and replacing and repealing Council Decisions 2009/371/JHA, 2009/934/JHA, 2009/935/JHA, 2009/936/JHA and 2009/968/JHA [2016] L135/53.

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European Anti-Fraud Office (OLAF), and the Member States. Europol has also set up a partnership with the private sector, including IPR holders, in the fight against organised crime. In March 2012, the European Commission decided to establish a European Cybercrime Centre 21.124 (EC3) at Europol. This Centre purports to be the central point in the EU’s fight against cybercrime, contributing to faster reactions in the event of online crimes and supporting the Member States and the EU’s institutions in building operational and analytical capacity for investigations and cooperation with international partners. It cooperates closely with foreign agencies such as the FBI and the US secret service. EC3 was inaugurated in The Hague on 11 January 2013. Unfortunately, the fight against illegal downloading does not form part of its duties.334 In 2016, however, Europol and the EUIPO stepped up their cooperation in the field of intellectual 21.125 property to create the Intellectual Property Crime Coordinated Coalition (IPC3), a specialist unit within Europol funded by the EUIPO. The IPC3 unit coordinates and supports cross-border operations aimed at tackling intellectual property crime across the EU. The unit’s operations have spanned sectors like illegal streaming, pharmaceuticals, food and drinks, pesticides, counterfeit luxury goods, clothing, electronics, car parts, and toys. Over 100 organised crime groups have been identified and/or dismantled as a result of IPC3’s work. The investigations coordinated by the IPC3 have also linked IP crime to the health and safety of consumers, drug trafficking, tax evasion, fraud, and terror financing.335 In 2012, Europol joined the ICE336-led National Intellectual Property Rights Coordination Center 21.126 (IPR Center),337 a task force, which aims to optimise the roles and enforcement efforts of its 25 domestic and international member agencies to combat intellectual property theft. The ‘In Our Sites’ (IOS) operation, which involved law enforcement agencies from within and outside the EU, and from North and South America, and East and Southeast Asia, has shut down almost 1,000 websites selling merchandise online to consumers. The operation was coordinated by Europol in Europe, and by the IPR Center for the US.338 On 26 June 2013, a similar action known as ‘Transatlantic 2’, which involved ICE and several law enforcement agencies in Europe, coordinated by Europol, resulted in the seizure of another 328 websites.339 Europol has also supported a number of Interpol-led international operations, known as ‘Operations Pangea’, targeting the illicit online sale of medicines,340 as well as ‘Operation OPSON’, jointly led by Europol and Interpol, which addresses the threat from food and beverage counterfeiting and fraud.341 While counterfeiting and piracy were identified as serious issues in Europol’s 2013 and 2017 Serious and Organised Crime

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Interview with Troels Ørting, head of the European Cybercrime Centre, 11 January 2013, . Regarding EC3’s activities, see . See . US Immigration and Customs. . The domain names seized are in custody of the governments involved in the operation. Visitors typing those domain names into their web browsers now find a banner which notifies them of the seizure and educates them about IP crimes. See . In addition to the domain name seizures, officials identified PayPal accounts used by the infringers; proceeds received through these accounts, in excess of USD 30,000, were subsequently targeted for seizure (see Europol’s press release of 26 June 2013 at ). See . See .

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Threat Assessments,342 and IP crime was included in the priorities of the European Multidisciplinary Platform Against Criminal Threats (EMPACT) for the period 2014–2017, this is not the case in the current policy cycle deciding on the priorities for EU law enforcement for the period 2017–2021, as adopted by the Council of the EU at its meeting on 18 May 2017. ii.

Judicial cooperation: Eurojust

21.127 On 28 February 2002, the Council published its Decision 2002/187/JHA setting up Eurojust with a view to reinforcing the fight against serious crime,343 which implemented a decision made at the European Council’s meeting at Tampere (Finland) on 15 and 16 October 1999. This Decision was repealed and replaced by Regulation (EU) 2018/1727 of 14 November 2018.344 Eurojust is an autonomous EU agency with its own legal personality.345 Its objective is to improve judicial cooperation between the Member States, in particular in the fight against serious crime perpetrated by trans-national organisations. More specifically, Eurojust’s main duty is to stimulate and improve the coordination of international investigations and prosecutions within the EU to make them more effective, and thus to facilitate the judicial follow-up of crimes by the national courts of the EU Member States. It is tasked with establishing and maintaining a close cooperation with Europol,346 the European Public Prosecutor’s Office (EPPO)347 and the European Anti-Fraud Office (OLAF),348 amongst others, and the governments of the Member States,349 and to facilitate judicial cooperation with countries outside the EU350 and the organisation of coordination meetings involving magistrates from various countries.351 While Europol helps law enforcement agencies to identify criminals, Eurojust helps judicial authorities to prosecute them. Eurojust’s competence extends the ‘serious crimes’ listed in Annex I to the Eurojust Regulation, which include, amongst others, product piracy and counterfeiting, computer crime, organised crime, and any ‘crime against the financial interests of the Union’, and any other offences committed in order to facilitate or commit those ‘serious crimes’, to procure the means of committing them, or to ensure the impunity of those committing them. For other types of offences, Eurojust may also assist in investigations and prosecutions at the request of the Member States.352 iii.

Customs cooperation: OLAF

21.128 OLAF is an EU agency whose objectives are to protect the financial interests of the EU by fighting against fraud, corruption, and any other illegal activities, including smuggling and counterfeiting of (mainly excise) goods.353 It was set up in 1999.354 Its duties are to facilitate customs cooperation by

342 343 344 345 346 347 348 349 350 351 352 353 354

See . [2002] OJ L63/1. Regulation (EU) 2018/1727 of 14 November 2018 on the European Union Agency for Criminal Justice Cooperation (Eurojust), and replacing and repealing Council Decision 2002/187/JHA [2018] OJ L295/138. Eurojust Reg., Art. 1. Ibid., Art. 49. Ibid., Art. 50. Ibid., Art. 51. Ibid.., Art. 21. Ibid., Art. 52. Ibid., Art. 53. Ibid., Art. 3. Cf. . OLAF was established by Commission Decision 1999/352/EC, ECSC, Euratom of 28 April 1999 (last amended by Commission Decision of 27 September 2013 [2013] OJ L257/19). The modalities of both internal and external investigations conducted by OLAF were initially laid down in European Parliament and Council Regulation (EC) No 1073/1999 ([1999] OJ L136/1) and Council Regulation (Euratom) No 1074/1999 of 25 May 1999 ([1999] OJ L136/8). Regulation 1074/1999 and 1073/1999 were repealed as of 1 October 2013 in order to improve the efficiency, effectiveness and accountability of the Office (Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11 September 2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (EC) No 1073/1999 of the European Parliament and of the Council and Council Regulation

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promoting information sharing and by supporting criminal investigations carried out in the EU Member States and third countries, based on Regulation 515/97.355 Between 2010 and 2018, OLAF has concluded around 1,900 investigations. One of OLAF’s main tools for that purpose is the Customs Information System (CIS), a central database which contains details of fraudulent activities which could constitute crime. iv.

European Public Prosecutor’s Office

In 2017, the EU adopted Regulation (EU) 2017/1939356 to set up the European Public Prosecutor’s 21.129 Office (EPPO). The EPPO, which will start operating in 2020 in the participating 22 Member States357 and is a major step towards creating a common criminal justice area in the EU as a whole, will be the Union’s first independent and decentralised prosecution office within the EU, and will have the power to investigate, prosecute and bring to judgment crimes against the EU budget, such as corruption, fraud or serious cross-border VAT fraud. While OLAF will continue its administrative investigations into fraud and irregularities affecting the EU’s financial interests, the EPPO will be responsible for criminal investigations. Both bodies will, therefore, be called upon to consult and coordinate with each other. Unlike national authorities, the EPPO will be able to act across borders without the need for lengthy judicial cooperation proceedings. It will operate as a single office and will be fully independent: it will neither seek nor take instructions from either EU or national authorities.358 It remains to be seen whether the EPPO will consider that the fight against piracy and counterfeiting falls within the ambit of its competences. v.

Other mutual assistance instruments

Europol and Eurojust complement the Council of Europe’s Convention on Mutual Assistance in 21.130 Criminal Matters signed in Strasbourg on 20 April 1959, as well as the Naples II Convention on the facilitation of the operational aspects of investigations,359 and the Convention on Mutual Assistance in Criminal Matters between the Member States of the European Union, adopted by the

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(Euratom) No 1074/1999 [2013] OJ L248/1). The objective of the reform agreed is to reinforce cooperation between OLAF and its strategic partners, such as Europol and Eurojust, as well as third countries, in the fight against fraud. In addition, the OLAF reform strengthens the procedural guarantees for any person under investigation by the Office. OLAF has now been given the mandate to conclude administrative agreements with the above bodies and with non-EU countries. The new Regulation also seeks to redress fraudulent behaviours by intensifying cooperation between the Office and Member States authorities. One of the problems in fighting fraud at EU level has, indeed, been the disappointing level of follow-up by some Member States on OLAF investigations. Further, the reform aims to reinforce the cooperation and information exchange between the Office and the EU institutions and to promote the exchange of views between the Office and the European Commission, Parliament, and Council. The objective is to allow the institutions to discuss OLAF’s strategic priorities and to give their opinions on the effectiveness of the work being carried out by the Office. The new OLAF Regulation entered into force on 1 August 2013. Meanwhile, the European Commission recently said it was ready to work on a second tier of reforms for OLAF (cf. MEMO 13/651 of 3 July 2013 at ). See also, in this regard, . Council Regulation (EC) No 515/97 of 13 March 1997 on mutual assistance between the administrative authorities of the Member States and cooperation between the latter and the Commission to ensure the correct application of the law on customs and agricultural matters [1997] OJ L82/1. This Regulation has been amended several times. Council Regulation (EU) 2017/1939 of 12 October 2017 implementing enhanced cooperation on the establishment of the European Public Prosecutor’s Office (‘the EPPO’) [2017] OJ L183/1. Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Estonia, Finland, France, Germany, Greece, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Portugal, Romania, Slovakia, Spain and Slovenia. See . Council Act 98/C24/01 of 18 December 1997 drawing up, on the basis of Art. K.3 of the Treaty on European Union, the Convention on mutual assistance and cooperation between customs administrations [1998] OJ C24/1.

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Council on 29 May 2000360 and the Protocol thereto adopted on 16 October 2001.361 The Naples II Convention has allowed Customs and police to cooperate and use special investigative techniques to identify criminal networks. The Convention on Mutual Assistance, for its part, constitutes a major step forward in the conduct of complex cross-border investigations, through the setting up of joint investigation teams made up of judges and police or Customs officers from several countries – in which EU and non-EU countries may participate, subject to certain conditions – which greatly facilitate intelligence gathering and information sharing. Officials from Europol, Eurojust, and OLAF also participate in such teams.362 21.131 The results of operations such as operation ‘Gomorrah’,363 which led to the arrest of 69 criminals and the seizure of 800 tonnes of counterfeit goods (mostly power generators) in various EU Member States, and operation ‘Fox’,364 a major operation headed by Europol and Eurojust against an illegal film downloading network in 14 European countries and Australia, which led to the arrest of 19 people and the closing down of 49 servers, show the success of mutual assistance in the fight against intellectual property crime.

D. Risk-analysis tools and electronic data interchange systems 21.132 The European Commission has long struggled to implement electronic data interchange systems which would enhance the effective enforcement of IPRs in the EU. In its Communication of 11 September 2009, it stressed the need to set up and make available to national enforcement bodies and national intellectual property offices an electronic network for information sharing on IPR infringements in the EU. The idea behind this was to support ‘real-time’ exchanges of information on goods and services infringing IPRs in the EU, especially at the borders, to allow the swift exchange of alerts about specific products and trends and potential threats, and to provide facilities to overcome language barriers for national authorities.365 DG TAXUD has thus set up a database, called COPIS, in which the applications for action by customs authorities filed by right holders under Regulation 608/2013 can be stored and updated. COPIS has been up and running in all EU Member States since 1 January 2014. In parallel, the Observatory on Infringements of Intellectual Property Rights has designed its own IPR ‘Enforcement Database’ (also known as ‘EDB’). This platform, which is also endorsed by Europol and DG TAXUD, provides a central repository of information uploaded by right holders, such as pictures of products, contact persons for enforcement matters, logistics, prior cases, identifiers, packaging, or any other information useful for enforcement authorities to distinguish between genuine goods and fakes. All information supplied by the right holders is translated into the official languages of the EU and can be accessed by customs and police authorities across the EU. However, right holders can choose to whom they want the information to be available. The Enforcement Database also allows right holders to automatically generate prefilled applications for action by customs authorities and to file them electronically directly in COPIS. Use of this tool is free of charge; the only prerequisite for registration on the platform is a valid registered trademark within the EU. It should be noted that the Enforcement Database does not aim to be an information-sharing or mutual-assistance instrument for law enforcement agencies.

360 361 362 363 364 365

Council Act of 29 May 2000 establishing in accordance with Art. 34 of the Treaty on European Union the Convention on mutual assistance in criminal matters between the Member States of the European Union [2000] OJ C197/1. [2001] OJ C326/2. Godart, n 25 above, paras 2.80–2.82. Europol Review – General Report on Europol Activities (23 April 2010), p. 61, File No 1423-25rl, . Godart, n 25 above, para. 2.90. Commission Communication of 11 September 2009 (n 9 above), 9.

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Next to the Enforcement Database, the Observatory also launched an ‘Anti-Counterfeiting 21.133 Intelligence Support Tool’ (ACIST), as well as an ‘Anti-Counterfeiting Rapid Intelligence System’ (ACRIS). The ACIST database is a statistical tool which provides data relating to border seizures provided by the European Commission’s DG TAXUD and by police authorities from all EU Member States, permitting the creation of analysis and trend reports.366 It aims to present a comprehensive picture of IPR infringements across the EU in order to assist companies with risk management of their IPRs identifying geographical areas and products of high risk for their rights. It gathers statistics on detentions of goods that are suspected of infringing IPRs and converts the collected data into a harmonised format so that they can be compared and aggregated. ACIST was launched in 2012. It has been made available to all law enforcement authorities in every EU Member State in 2013. ACRIS, for its part, was launched in 2016. It allows EU companies to report on IPR infringements in countries outside the EU in a structured format, thus being able to submit cases, search their own cases and report on them. The sharing of this information with the EU Commission is also of paramount importance in negotiations with third countries on the intellectual property situation in those countries. All contributions are shared amongst users of the tool in an anonymised way so that overall statistics by country can be drawn and trends identified.367 In June 2019, the Observatory brought together the Enforcement Database, ACIST, and ACRIS 21.134 into a single IP Enforcement Portal, thus enabling right holders and their legal representatives to manage trademarks and designs ‘from filing to enforcement’.368

V. THE FIGHT AGAINST PIRACY ON THE INTERNET The advent of the internet has undeniably made the enforcement of IPRs more complex. Nowhere 21.135 has it had a more deleterious effect than on copyright and related rights. It is generally accepted that ‘counterfeiters and pirates […] are well financed and have become organised, highly skilled entrepreneurs operating on an industrial scale’.369 They: make full use of advances in technology and trade, adopting modern business models to control the production, distribution and sale of illicit goods across borders and continents. The internet is one such tool that is being used to drive a worldwide market in infringing products, which is stifling innovation and threatening jobs.370

Unsurprisingly, the digital environment has formed the most violent battleground between the right holders on the one hand and, on the other, the supporters of an unregulated internet and their allies, the upholders of the protection of personal data, and the defenders of free speech and freedom of information. Obviously, the lack of complete harmonisation of copyright and related rights at the EU level does 21.136 nothing to facilitate the fight against internet piracy. However, this is far from the only issue with which right holders and enforcement bodies have to cope when trying to combat online copyright and related right infringements. First, internet surfers rarely reveal their (real) identities. It is particularly complicated for right holders to obtain their personal data from ISPs, as such requests are difficult to reconcile with the right to the protection of personal data. Even if the right holder manages to obtain the IP address of a surfer who has allegedly infringed his or her rights, the

366 367 368 369 370

. . . Commission Communication of 11 September 2009 (n 9 above), 3. Ibid.

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internet user’s real identity remains unknown, as an IP address is merely the address of the device used by the latter to access the internet.371 Even if the surfer can be identified without breaching privacy rights, how can the right holder prove it was that person who downloaded or uploaded the illegal content, and not someone else who had access to his device? Second, there is broad consensus that online service providers (‘OSPs’) are generally best placed to remove or block access to illegal content. However, should their role be limited to blocking or removing illicit content on request, or should they be asked to act in a more proactive manner to spot and disable access to such content? Better still: should their neutrality be put into question? These are only a few examples of the issues right holders have to cope with in the fight against online IPR infringements. 21.137 Legislators have attempted to strike a balance between the rights of all interested parties (right holders, internet users, and OSPs) in several ways. Overall, four options have appeared on the legal world map: (i)

(ii) (iii)

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a regime whereby access to illegal contents is blocked at the request of the right holder or of law enforcement agencies, mostly under court supervision. This type of system currently operates in Spain,372 and Denmark is moving towards a similar system.373 Such systems have allowed the authorities to curtail the activities of the ‘Pirate Bay’ in several different countries. The United States – with the Digital Millennium Copyright Act (DMCA)374 – and the EU – with the E-Commerce and the DSM Directives375 – have opted for ‘notice-and-action’ (or ‘notice-and-takedown’) systems, which absolve OSPs from any liability if they take some preventive measures and/or remove illegal content after having been notified of its existence; a more moderate system limited to a formal warning. This ‘soft’ option has been chosen in Australia and Finland, for example; a system of ‘graduated response’ leading to blocking access to the internet for repeat offenders. The most well-known example of such a system is the famous Loi Hadopi in France.376 Several private organisations are also considering implementing ‘six strikes and

In the EU, the CJEU’s judgment of 18 October 2018 in Case C-149/17 (Bastei Lübbe GmbH & Co. KG v. Michael Strotzer, ECLI:EU:C:2018:841) is relevant in this regard. In this case, the Court held that Art. 8(1) and (2) of the InfoSoc Directive, read in conjunction with Art. 3(1) thereof, and Art. 3(2) of the IPRED, preclude national legislation under which the owner of an internet connection used for copyright infringements through file-sharing cannot be held liable to pay damages if he or she can name at least one family member who might have had access to that connection, without providing further details as to when and how the internet was used by that family member. Spanish Law for Sustainable Economy of 8 January 2008, as amended (‘Ley Sinde’, ‘Sinde Law’). Cf. . The courts of the UK, the Netherlands, Belgium, Finland, Denmark, Greece, Austria and Italy have been reported to issue such injunctions: cf. M. Husovec, ‘European cases on ordering ISPs to block certain websites’, Hut’ko’s Technology Law Blog, (November 2011). The DMCA is a US copyright law which implements the WCT and WPPT. DMCA Title II, the Online Copyright Infringement Liability Limitation Act (‘OCILLA’), creates a ‘safe harbour’ for OSPs against copyright infringement liability, provided they promptly block access to alleged infringing material (or remove such material from their systems) when they receive notification of an infringement claim from a copyright holder or the copyright holder’s agent. OCILLA also includes a counter-notification provision that offers OSPs a ‘safe harbour’ from liability to their users when users claim that the material in question is not infringing. OCILLA also facilitates issuing of subpoenas against OSPs to provide their users’ identity. Many Free Trade Agreements concluded by the US are inspired by the DMCA, thus granting ISPs limited immunity from liability in certain types of infringing activities provided they block access to or remove infringing materials upon being notified of the infringement: see S. Ilias and I. Fergusson, Intellectual Property Rights and International Trade, Congressional Research Service, Washington, DC, 2009, 24–25. See paras 21.139 ff below. Loi n° 2009-669 du 12 juin 2009 favorisant la diffusion et la protection de la création sur internet (as amended by the ‘Hadopi2’ Law on 28 October 2009). It should be noted that, as a result of a Decree of 8 July 2013, which abolished Art. R.335-5 of the French Intellectual Property Code, the possibility for the French criminal courts to order the blocking of internet access has been severely limited; such a penalty can no longer be applied in the case of non-commercial file

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(iv)

you’re out’ systems in the USA as ‘soft law’, further to the failure of the SOPA377 and PIPA378 bills. The effectiveness of such systems remains to be seen: for example in France, only one defendant has reportedly been deprived of his internet access (for a period of 15 days) under the Hadopi law to date;379 a system of mandatory licences which allow internet users to download any sort of content protected by copyright or related rights – from legal or illegal websites – in return for an annual fee.380

At the EU level, the IPRED, the E-Commerce Directive and the DSM Directive constitute useful 21.138 tools to combat online IPR infringements. However, the interaction between those Directives is rather delicate.

1. Legislative actions A. The E-Commerce Directive The E-Commerce Directive381 provides a framework for the cross-border provision of online 21.139 services in the EU. It includes exemptions from liability (so-called ‘safe harbour’ provisions) for ISPs. In particular, Articles 12–14 provide that ISPs acting as mere conduits (transmitting data by an internet access provider), cache content (automatically making temporary copies of web data to speed up technical processes), or host content (storing content provided by the user of an online service) may not be held liable for illegal content, provided that they do not have actual knowledge of such content and (in the case of hosts) are not aware of facts or circumstances from which the illegal content is apparent. In all cases except caching, if he is to be exempted from liability, the service provider is further required, upon obtaining such knowledge or awareness, to act expeditiously to remove or disable access to the content. This rule forms the basis for so-called ‘notice-and-action’ (N&A), sometimes also referred to as ‘notice-and-take-down’. In addition, the E-Commerce Directive encourages voluntary agreements between stakeholders on ‘rapid and reliable procedures for removing and disabling access’ to illegal content.382 It should be noted that the ‘safe harbour’ regime laid down in Article 14(1) of the E-Commerce Directive does not apply to situations

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sharing (Décret n° 2013-596 supprimant la peine contraventionnelle complémentaire de suspension de l’accès à un service de communication au public en ligne et relatif aux modalités de transmission des informations prévue à l’article L.331-21 du code de la propriété intellectuelle). However, the sanction does subsist in Arts L.335-7 and L.335-7-1 of the French Intellectual Property Code for other situations. The ‘Stop Online Piracy Act’ (SOPA) is a US bill introduced on 29 October 2011 to expand the ability of law enforcement agencies to fight online trafficking in copyrighted material and counterfeit goods. Provisions included the requesting of court orders to bar advertising networks and payment facilities from conducting business with infringing websites, and search engines from linking to the websites, and court orders requiring ISPs to block access to the websites. SOPA also aimed to expand existing criminal laws to include unauthorised streaming of copyrighted content, imposing a maximum penalty of five years in prison. Opponents to SOPA stated the proposed legislation threatened free speech and innovation, and enabled law enforcement to block access to entire internet domains due to infringing content posted on a single blog or webpage. They have raised concerns that SOPA would bypass the ‘safe harbour’ protections from liability presently afforded to OSPs by the Digital Millennium Copyright Act (see n 374 above). The ‘PROTECT IP Act’ (PIPA) is a bill which aimed to give the US government and copyright holders additional tools to curb access to websites dedicated to the sale of infringing goods, especially those registered outside the US. It was introduced on 12 May 2011. Le Monde, ‘Téléchargement: la coupure d’accès à Internet supprimée en trompe-l’oeil’ (9 July 2013), . This type of system raises several questions. Is it not de facto legalisation of illegal downloading? Will it not encourage unfair competition between illegal websites and legal websites? And how will the fee revenues be redistributed among right holders? Directive 2000/31/EC, n 104 above. Ibid., Recital 40; see also Art. 16 on ‘Codes of conduct’. Some examples of such voluntary agreements will be discussed in paras 21.196–21.198 below.

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covered by Article 17 of the DSM Directive in those cases where an online content sharing service provider performs an act of communication to the public or an act of making available to the public under the conditions laid down in the DSM Directive.383 21.140 The E-Commerce Directive further states that the Member States may not impose a general obligation on ISPs, when providing the services covered by Articles 12, 13, and 14, to monitor the information which they transmit or store, nor a general obligation actively to seek facts or circumstances indicating illegal activity.384 However, the recitals make it clear that Member States are prevented from imposing a monitoring obligation on ISPs only when it is of a general nature; ‘this does not concern monitoring obligations in a specific case and, in particular, does not affect orders by national authorities in accordance with national legislation’; neither does the Directive affect the ability of Member States to require ISPs who host information provided by recipients of their service to apply a reasonable duty of care, in order to detect and prevent illegal activities.385 21.141 By judgment of 15 September 2016, the CJEU addressed the issue whether the exemption from liability laid down in Article 12(1) of the E-Commerce Directive precludes the national courts from finding liable a natural or legal person operating a wireless local area network by means of which a copyright-protected musical work had been made available on the internet free of charge to the general public by a third party without the right holder’s consent. 21.142 First, the Court held that, to the extent that Article 12(1) of the E-Commerce Directive refers to ‘information society services’, it covers only those services normally provided for remuneration, by electronic means and at the individual request of a recipient of services. However, the remuneration of a service supplied by a service provider does not require the service to be paid for by those for whom it is performed. A service provided by a communication network operator and consisting in making that network available to the general public free of charge also constitutes an ‘information society service’ within the meaning of Article 12(1) of the Directive where the activity is performed by the service provider in question for the purpose s of advertising the goods sold or services supplied by that service provider, for example.386 21.143 Next, the Court stressed that Article 12(1) of the E-Commerce Directive, headed ‘Mere conduit’, only applies to services of a mere technical, automatic and passive nature, which involve the transmission of communication network information. No further conditions, such as a condition that there be a contractual relationship between the recipient and provider of that service or that the service provider use advertising to promote that service, are to be satisfied.387 The same principles apply to the exemptions from liability established in Articles 13(1) and 14(1) of the Directive.388 21.144 Thirdly, the Court emphasised that the exemptions from liability provided for in Articles 12(1), 13(1) and 14(1) of the Directive are governed by different conditions of application depending on the type of activity concerned. Thus, in order to benefit from the exemption from liability laid down in Article 14(1) in favour of internet website hosts, such hosts must act expeditiously upon obtaining knowledge of illegal information to remove or to disable access to it. By contrast, Article 12(1) does not subject the exemption from liability that it lays down in favour of providers of access

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Art. 17(3), first subparagraph, of the DSM Directive. However, Art. 14(1) of the E-Commerce Directive may apply to those service providers for purposes falling outside the scope of this Directive (ibid, second subparagraph). Regarding Art. 17 of the DSM Directive, see paras 21.186 ff below and the chapter of this book dedicated to this Directive. Ibid., Art. 15(1). Ibid., Recitals 47–48. CJEU, Case C-484/14, Tobias Mc Fadden v. Sony Music Entertainment Germany GmbH, ECLI:EU:C:2016:689, judgment of 15 September 2016, paras 35–43. Ibid., paras 44–54. Ibid., para. 61.

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to a communication network to compliance with such a condition. Indeed, the service provided by an internet website host consists in the storage of information and is, as such, of a more permanent nature. Accordingly, such a host may obtain knowledge of the illegal character of certain information that it stores subsequent to that when the storage was processed and when it is still capable of taking action to remove or disable access to it. The same is not true regarding communication network access providers: the services of transmitting information that they supply is not normally continued over any length of time. Therefore, after having transmitted that information, they no longer have any control over it. Consequently, communication network access providers are often not in a position to take action to remove certain information or disable access to it at a later time.389 Fourthly, the Court highlighted that it follows from Article 12(1) of the E-Commerce Directive 21.145 that, where service providers supplying access to a communication network do not initiate such a transmission, do not select the receiver of that transmission and do not select or modify the information contained in the transmission, they may not be held liable. Therefore an IPR holder is, in any event, precluded: (i) from claiming compensation from that service provider on the ground that the connection to that network was used by third parties to infringe its rights; and (ii) from claiming reimbursement of the costs of giving formal notice or court costs incurred in relation to its claim for compensation. However, it follows from Article 12(3) of the Directive that, where an infringement is perpetrated by a third party by means of a connection which was made available to him by a communication network access provider, Article 12(1) does not preclude the person harmed by that infringement from claiming injunctive relief against the continuation of that infringement and the payment of the costs of giving formal notice and court costs from the communication network access provider where such claims are made for the purposes of obtaining, or follow the grant of injunctive relief by a national authority or court to prevent that service provider from allowing the infringement to continue.390 The E-Commerce Directive does not deal with the issuing of blocking orders, nor with the 21.146 procedures for issuing such orders. It states, in this regard, that it ‘shall not affect the possibility for a court or administrative authority, in accordance with Member States’ legal systems, of requiring the service provider to terminate or prevent an infringement’,391 ‘nor does it affect the ability of Member States to establish procedures governing the removal or disabling of access to information’.392 The Directive also allows Member States to establish obligations for information society service providers promptly to inform the competent public authorities of alleged illegal activities undertaken or information provided by recipients of their service or obligations to communicate to the competent authorities, at their request, information enabling the identification of recipients of their service with whom they have storage agreements.393 In 2010, the Commission held a public consultation on the implementation of the E-Commerce 21.147 Directive and the future of e-commerce. The vast majority of the 420 respondents opined that the principles enshrined in the Directive were still sound and asked the Commission not to revise it. However, many respondents asked for clarifications of certain parts of the Directive, notably Article 14. Those respondents singled out three main problems with the functioning of N&A procedures. First, ISPs face high compliance costs and legal uncertainty because they typically operate across Europe and the concepts of ‘actual knowledge’, ‘awareness’ and ‘expeditiously’ used in Article 14 are interpreted in different ways by different national courts, which has led to divergent case law.

389 390 391 392 393

Ibid., paras 55–65. Ibid., paras 72–79. Directive 2000/31/EC, n 104 above, Arts 12(3), 13(2), and 14(3). Ibid., Art. 14(3). Ibid., Art. 15(2).

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Secondly, illegal content often stays online too long, in part due to what are perceived as insufficiently clear rules and procedures that are difficult to identify. Some stakeholders have stated that the requirement to act ‘expeditiously’ laid down in Article 14 is inappropriate and unsatisfactory. They would prefer a pre-defined timeframe for action. By contrast, other respondents thought that the required speed of action should depend on the circumstances of each specific case or on the type of content involved, because, while the assessment of the legality of content may be easy in some cases, it may be more difficult in others. Similarly, although the taking-down of content within a few hours would generally be considered very fast, it may not be fast enough for the live-streaming of sports events, that lose value once the event is finished. Thirdly, the N&A procedures, though not illegal in se, could be applied in a way which infringes fundamental rights – such as the right to freedom of expression and information394 – as a result of liability fears on the part of hosts and the fact that the providers of allegedly infringing content are, in general, not consulted before their ISP takes action. 21.148 Furthermore, the public consultation of 2010 also demonstrated that, while most stakeholders consider the hosting of websites to be ‘hosting’ in the sense of Article 14 of the E-Commerce Directive, there is uncertainty on what other services could be deemed to be ‘hosting’.395 In addition, civil rights organisations and hosting service providers have complained about unjustified or even abusive notices. Hence, some hosting service providers consult the provider of allegedly illegal content whenever they receive a notice and offer the content provider an opportunity to express his opinion on the allegation of illegality (via a so-called ‘counter-notice’).396 This obviously causes delays in the processing of N&A requests. Finally, while ‘removing’ in Article 14 of the Directive may be interpreted as ‘permanently taking down’ or ‘deleting’ content, the notion of ‘disabling access’ gives rise to discrepancies: thus, for example, some hosting service providers use geo-software to impede access exclusively to users with an IP address from a country where the content in question is considered illegal. 21.149 The CJEU has clarified that ‘awareness’ can result from investigations made on a service provider’s own initiative. Another means of becoming aware of ‘illegal content’ in the sense of Article 14 of the Directive is that the service provider is ‘notified’ of such content. Yet, a notice cannot automatically lead to ‘awareness’: if the notice is ‘insufficiently precise or inadequately substantiated’ the notice does not make the service provider ‘aware’ of illegal content.397 The public consultation conducted in 2010 shows that, whilst some hosting service providers have put in place mechanisms to receive notifications of illegal content, others have not. In all cases, right holders remain free to notify

394 395

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The CJEU has held, in this context, that blocking of legal content could potentially undermine the freedom of expression and information: see below, paras 21.162–21.163. The CJEU (Grand Chamber) has stated that ‘hosting’ may in principle include, e.g., the services offered by online marketplaces, referencing services, and social networks. The Court held that the ‘safe harbour’ provision laid down in Art. 14(1) of the E-Commerce Directive had to be interpreted as applying, inter alia, to the operator of an online marketplace where that operator has not played an active role allowing it to have knowledge or control of the data stored. The operator plays such a role when it provides assistance which entails, in particular, optimising the presentation of the offers for sale in question or promoting them. Where the operator of the online marketplace has not played such a role within the meaning of the preceding paragraph and the service provided falls, as a consequence, within the scope of Art. 14(1) of the Directive, the operator nonetheless cannot, in a case which may result in an order to pay damages, rely on the exemption from liability provided for in that provision if it was aware of facts or circumstances on the basis of which a diligent economic operator should have realised that the offers for sale in question were unlawful and, in the event of it being so aware, failed to act expeditiously in accordance with Art. 14(1)(b) of the Directive (Case C-324/09 L’Oréal v. eBay , n 141 above, Order). However, the report also emphasises that in some Member States, such arrangements would seem not to be possible, mainly due to the restrictions imposed by privacy laws and protection of personal data, which prevent intermediaries (such as ISPs) forwarding warning notices to the alleged infringers. Case C-324/09 L’Oréal v. eBay, n 141 above, paras 121–122.

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service providers as they choose, including via means that are difficult for the service providers to process – which obviously will lead to delays in taking action against illegal content. Another issue pinpointed by the respondents to the consultation relates to the proportionality of 21.150 N&A requests. For example, a particular ‘wall post’ on a social networking website may be hosted both by the social network and by the hosting service provider that leases server capacity to the social network. Is it reasonable to ask this hosting service provider to act against the allegedly illegal content – which, in most cases, he would not be able to do without acting also against other (legal) content, or even taking down an entire website – or should the notice provider, by virtue of the principle of proportionality, be obliged in such cases to notify only the hosting service provider that is technically in a position to remove or disable exclusively the notified illegal content? The Staff Working Paper accompanying the European Commission’s Communication of 11 21.151 January 2012 on E-Commerce and other online services398 provides an overview of the implementation of Article 14 and the functioning of the N&A procedures in the EU. Following the release of this paper, the Commission undertook a new fact-finding exercise on N&A procedures which included another set of targeted stakeholder consultations. This new survey aimed to assist the Commission in determining, inter alia, whether or not: (i) specific rules should be adopted to avoid unjustified notifications; (ii) email should be made mandatory for notifying illegal content; (iii) service providers should be obliged to consult the providers of allegedly illegal content, and if so at what stage of the procedure (that is, before or after removing or disabling access to the content); (iv) a pre-defined timeframe for action should be established; (v) different categories of illegal content required different policy approaches as regards N&A procedures. On the occasion of this public consultation, the European Data Protection Supervisor (‘EDPS’) supported, among other things, a clarification of the notion of ‘hosting’ in Article 14 of the E-Commerce Directive, whilst stressing that the definition of the activities that should be considered as ‘hosting’ for the purpose of applying the ‘safe harbour’ provisions of the Directive should not affect the liability incurred by the service providers concerned under data protection law. The EDPS also supported implementation of EU-wide harmonised procedures and an EU-wide harmonised form for notifying illegal content, which would help reduce divergences and provide more legal certainty to all stakeholders. The design of the form should follow the principle of proportionality and contain only the minimum personal information required for the purpose of such notification. Further, the EDPS recommended that the procedures should take full account of the privacy and data protection principles399 and provide, inter alia, for a transparent and easy manner to challenge a decision of a service provider to take down material. It added that unjustified or abusive notices should be subject to rules and possible sanctions, as those responsible for abusive notices should also be responsible under data protection rules for purposely transmitting inaccurate data.400 Overall, it appears that, even though the system of ‘notice-and-take-down’ set forth by the 21.152 E-Commerce Directive is not without some difficulties, it is relatively efficient. While no official figure is known in this area in Europe, according to some sources Google handled 75,000,000 N&A

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Commission Communication to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions ‘A coherent framework for building trust in the Digital Single Market for E-Commerce and Online Services’, COM(2011) 942 final. The EDPS highlighted, in this regard, that the respect of data protection law in handling a notice was critical not only with a view to protecting notice providers, but was ‘also particularly crucial in protecting alleged infringers, in particular cases where it later appears that these persons have been subject to unjustified or abusive notices’. EDPS, Comments of 13 September 2012 on DG MARKT’s public consultation on procedures for notifying and acting on illegal content hosted by online intermediaries, .

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requests every month (or 2 million requests per day) in 2015 under the DMCA.401 In 2008, the US giant processed a few dozen requests a year, whereas in December 2012, it complied with slightly less than half a million requests per day. Some fear – while others rejoice – that, faced with such an increase in the quantity of requests, Google will be more and more prone to de-listing sites in the future without making a proper assessment of the legal or illegal nature of their content.

B. The ‘Telecom Package’ 21.153 In the EU, a ‘three-strikes’ solution, leading to blocking access to the internet for repeat offenders, was expressly rejected by the Commission in the debate on the Telecom Package 2009 – the EU regulatory framework for electronic communications.402 Instead, an ‘internet freedom provision’ (known as the ‘Amendment 138’) was included in the final text of this legislation, which was adopted by the European Parliament on 24 September 2008. The European Parliament thus rejected the idea of ‘three-strikes’ procedures being imposed as part of the EU acquis.403 The Telecom Package requires that no measures restricting end-users’ internet access be taken unless they are appropriate, proportionate, and necessary within a democratic society. Furthermore, such measures may never be adopted without a prior, fair and impartial trial that includes the right to be heard and respects the right to privacy and the presumption of innocence.404 C. The InfoSoc Directive and the IPRED 21.154 As already mentioned, the provisions of the InfoSoc Directive and the IPRED apply to both online and offline infringements. Reference is made to paragraphs 21.36 ff above in this regard. The relevant provisions of the new DSM Directive will be discussed below in paragraphs 21.186 ff. First, we will examine in the next section how the CJEU has been dealing so far with the tensions between the fundamental rights recognised under EU law and the rights arising from the provisions of the E-Commerce Directive, the InfoSoc Directive and the IPRED in favour of IPR holders.

D. The compatibility of injunctions, blocking orders, filtering obligations, and convictions for copyright or related rights infringement with fundamental rights 21.155 The liability ‘safe harbour’ provisions of the E-Commerce Directive are not inconsistent with the provisions of the InfoSoc Directive405 and the IPRED406 allowing the national courts in the Member States to issue injunctions against intermediaries. Recital 45 of the E-Commerce Directive provides, in this regard, that: [t]he limitations of the liability of intermediary service providers established in this Directive do not affect the possibility of injunctions of different kinds; such injunctions can in particular consist of orders by courts

401 402

403 404

405 406

. For the latest statistics on this topic, see . Directive 2009/140/EC of the European Parliament and of the Council of 25 November 2009 amending Directives 2002/21/EC on a common regulatory framework for electronic communications networks and services, 2002/19/EC on access to, and interconnection of, electronic communications networks and associated facilities, and 2002/20/EC on the authorisation of electronic communications networks and services [2009] OJ L337/37. See the Parliament’s decision on Art. 1.1b in the (amending) Dir. 2009/140/EC calling for the insertion of a new para. 3(a) in Art. 1 of Directive 2002/21/EC on the matter of the ‘three strikes’ policy. Amendment 46 (ex 138) of the Telecom Package, amending Art. 1, para. 3(a) of Directive 2002/22/EC of the European Parliament and of the Council of 7 March 2002 on universal service and users’ rights relating to electronic communication networks and services (Universal Service Directive) [2002] OJ L108/51. Recital 16 of the InfoSoc Directive (n 63 above) expressly provides that the latter is without prejudice to the ‘safe harbour’ provisions of the E-Commerce Directive. Cf. n 58 above. Recital 15 of the IPRED states that the latter does not affect the provisions of the E-Commerce Directive.

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V. THE FIGHT AGAINST PIRACY ON THE INTERNET or administrative authorities requiring the termination or prevention of any infringement, including the removal of illegal information or the disabling of access to it.

Although the provisions of the E-Commerce Directive, the InfoSoc Directive, and the IPRED do 21.156 not appear to go, by themselves, against fundamental rights, the way in which they have been implemented and/or they have been applied in some Member States has given rise to sensitive discussions which have, for some of them, ended before the CJEU.407 i.

The impact of fundamental rights on IPR enforcement

The protection of personal data and privacy, the freedom of expression, the freedom of information, 21.157 and the protection of intellectual property are all recognised as fundamental rights, respectively by Articles 7, 8, 11(1), 13, and 17(2) of the EU Charter of Fundamental Rights (‘the Charter’).408 The right to privacy and to the protection of personal data, as well as the right to freedom of expression and the right to property are also recognised by the European Convention on Human Rights (‘ECHR’), respectively in Articles 8 and 10(1), first sentence, and in Article 1 of the First Protocol. The right to conduct a business is equally protected, pursuant to Article 16 of the Charter. Pursuant to Article 6(1) TFEU,409 fundamental rights, as guaranteed by the Charter, form part of primary Union law. The Charter has the same legal value as the EU Treaties. Moreover, pursuant to Article 6(3) TFEU, fundamental rights, as guaranteed by the ECHR410 and as they result from the constitutional traditions common to the Member States, constitute general principles of the Union’s legal order. Thus, the Charter and the ECHR take precedence over all other EU legislation, including international agreements concluded by the EU. The question of the delicate balance between enforcement of IPRs and the protection of the right to 21.158 privacy and the freedom of expression is leading to ever increasing case law, whose boundaries remain somewhat ill defined.411 In the Promusicae, Scarlet Extended and Netlog cases, which will be further discussed below,412 the CJEU emphasised, in that framework, that protection of intellectual property is not an absolute fundamental right and that EU law requires a fair balance to be struck between the various fundamental rights protected by the EU legal order. The Court in fact leaves it up to the Member States to find the appropriate solutions reflecting the proper balance between the rights involved.413

407 408 409 410

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On the tensions between website-blocking orders and the right to a fair trial and the legality principle, see M. Husovec, ‘Injunctions against Innocent Third Parties’ (n 169 above). Charter of Fundamental Rights of the European Union [2000] OJ C364/1. See n 262 above. All Member States of the Council of Europe (which includes all EU Member States) signed up to the ECHR. The EU is not a Party to the Convention and its acts cannot as such be the subject of applications to the European Court of Human Rights. On the tensions between copyright law and the freedom of expression and information, see, inter alia, P.B. Hugenholtz, ‘Copyright and freedom of expression in Europe’, in R.C. Dreyfus, D.L. Zimmerman and H. First (eds), Expanding the Boundaries of Intellectual Property, Oxford University Press, Oxford, 2001; C. Geiger, Droit d’auteur et droit du public à l’information. Approche de droit comparé, Paris, Litec, 2004; P.L.C. Torremans (ed.), Copyright and Human Rights. Freedom of Expression – Intellectual Property – Piracy, Kluwer Law International, Information Law Series, The Hague/London/New York, 2004; A. Strowel and F. Tulkens, ‘Freedom of expression and copyright under civil law: Of balance, adaptation and access’, in J. Griffiths and U. Suthersanen (eds), Copyright and Free Speech. Comparative and International Analyses, Oxford University Press, Oxford, 2005, 287–313; S. Mendis, Copyright, the Freedom of Expression and the Right to Information – Exploring a Potential Public Interest Exception to Copyright in Europe, Nomos, Baden, 2011; E. Izyumenko, ‘The freedom of expression contours of copyright in the digital era: a European perspective’ (2016) 3–4 The Journal of World Intellectual Property 115–30; B.J. Jutte, ‘The beginning of a (happy?) relationship: copyright and freedom of expression in Europe’ (2016) 38(1) European Intellectual Property Review 11–22; and C. Geiger and E. Izyumenko, ‘Freedom of expression as an external limitation to copyright law in the EU: the Advocate General of the CJEU shows the way’ (2019) 41(3) European Intellectual Property Review 131–7. See paras 21.162 ff. See I. Stamatoudi, ‘Towards an updated EU Enforcement Directive? Selected topics and problems’, n 204 above, 8.

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21.159 The ‘notice-and-take down’ mechanism set out by the E-Commerce Directive appears to be in line with the ECHR and the Charter. Thus, on 6 March 2012, the UK Court of Appeal held that the UK Digital Economy Act, which also provides for a ‘notice-and-take-down’ regime, was legal and compatible with EU law – including Articles 3, 12, and 15 of the E-Commerce Directive, Article 15(1) of the Data Protection Directive,414 and the principle of proportionality.415 However, as has been mentioned above,416 the public consultation conducted by the Commission regarding the application of the E-Commerce Directive shows that the N&A procedures, though not illegal in se, can on occasion be applied in a way which infringes fundamental rights. 21.160 More ink has been spilled over the implementation and application of the provisions of the IPRED in the Member States. The IPRED aims ‘to ensure full respect for intellectual property, in accordance with Article 17(2) of [the] Charter [of Fundamental Rights of the European Union]’ and ‘respects the fundamental rights and observes the principles recognised in particular by [that] Charter’.417 However, it further specifies that the protection of IPRs should not hamper freedom of expression, the free movement of information, or the protection of personal data, including on the internet.418 In other words, while the IPRED is deemed not to be inconsistent with fundamental rights by itself, Member States should be wary of implementing and applying it in a way which does not affect such rights.419 21.161 The CJEU has had to address this issue on several occasions and will undoubtedly be called upon to provide further guidance in the future. The Council of Europe and the EDPS have also formulated

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Directive 95/46/EC of the European Parliament and of the Council of 24 October 1995 on the protection of individuals with regard to the processing of personal data and on the free movement of such data [1995] OJ L281/31. The Data Protection Directive has in the meantime been replaced by Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) [2016] OJ L119/1; see Art. 23(1). See UK Court of Appeal, British Telecommunications plc v. The Secretary of State for Culture, Olympics, Media and Sport, Case No C1/2011/1437 [2012] EWCA Civ 232, available at . The Court of Appeal upheld the judgment rendered at first instance by the High Court on 20 April 2011 (High Court of Justice (Queen’s Bench), British Telecommunications plc v. The Secretary of State for Business, Innovation and Skill, Case No CO/7354/2010 [2011] EWHC 1021 (Admin)). Interestingly, the system laid down in the Digital Economy Act was found to be proportionate by the High Court, inter alia, on the grounds that voluntary agreements between stakeholders had proved unsuccessful: It was explained that the Government’s preferred solution to the problem of unlawful P2P file sharing had been for ISPs and copyright owners to collaborate to produce their own voluntary codes of best practice to reduce its incidence. In the event, no such agreement was forthcoming, despite the encouragement given in the Government’s Creative Britain strategy document. There were further efforts to reach a voluntary agreement through a MoU. Following consultation the Government favoured a ‘co-regulatory’ response, in which a voluntary agreement reached by industry would be supervised by Ofcom. After further consideration on that proposal, it was found to be impractical. By the time of the publication of the Digital Britain Interim Report in January 2009, the MoU process had ceased, and legislation was inevitable. (Judgment, paras 222–223)

416 417 418 419

Cf. para. 21.148. IPRED, Recital 32. Ibid., Recital 2. The IPRED (Recital 23), like the InfoSoc Directive (Recital 59), provides that the procedures and conditions for issuing injunctions against intermediaries are left to the national law of the Member States. However, the rules of national law ‘must be designed in such a way that the objective pursued by the directive may be achieved’ (CJEU, L’Oréal v. eBay, paras. 135–6). According to Husovec, ‘[t]his means that EU Member States are free to create their own requirements for injunctions against intermediaries only within a certain room that is limited by the minimal standard of “effective and dissuasive measures” and the maximal ceiling set by Article 3 of the Enforcement Directive. It remains to be seen how big this room for the Member States is and how close the minimal standard and maximal standard actually are. What we know today is only that injunctions in L’Oréal v eBay were seen as a part of the minimal standard and that injunctions in [Netlog] C-360/10 and Scarlet Extended C-70/11 were found to go beyond the maximal admissible ceiling’ (M. Husovec, ‘Injunctions against Innocent Third Parties’ (n 169 above), 118). The L’Oréal case has been discussed in n 395 and 396 above.

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a number of recommendations and opinions, respectively, which, albeit non-binding, shed an interesting light on the interaction between IPR enforcement in the digital environment and the fundamental rights to freedom of expression and to the protection of privacy and personal data. Finally, the European Court of Human Rights (ECtHR) has also rendered a few noteworthy decisions on this subject over the last years. ii.

The CJEU’s case law

Scarlet Extended and Netlog With regard to filtering by online intermediaries, the CJEU recalled, in Scarlet Extended and Netlog, 21.162 that the rules for the operation of the injunctions for which the Member States must provide under Article 11 of the IPRED and Article 8(3) of the InfoSoc Directive, such as those relating to the conditions to be met and to the procedure to be followed, are a matter for national law.420 Nevertheless, the rules established by the Member States, and likewise their application by the national courts, must observe the limitations arising from both Directives and from the sources of law to which those Directives refer.421 Thus, in accordance with Recital 16 of the InfoSoc Directive and Article 2(3)(a) of the IPRED, those rules may not affect the provisions of the E-Commerce Directive.422 Consequently, those rules must, in particular, respect Article 15(1) of the E-Commerce Directive, which prohibits national authorities from adopting measures which would require an ISP or a hosting service provider to carry out general monitoring of the information that it transmits or stores.423 That prohibition applies in particular to national measures which would require an intermediary provider, such as an ISP or a hosting service provider, to actively monitor all the data of each of its customers in order to prevent any future IPR infringement.424 Furthermore, such a general monitoring obligation would be incompatible with Article 3 of the IPRED, which states that the measures to ensure the respect of IPRs referred to by the Directive must be fair and proportionate and should not be unnecessarily complicated or costly.425 The Court concluded that the E-Commerce Directive, the InfoSoc Directive, the

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Case C-70/10 Scarlet Extended (n 142 above), para. 32; Case C-360/10 Netlog (n 143 above), para. 30. See also IPRED, Recital 23. Scarlet Extended, para. 33; Netlog, para. 31. Scarlet Extended, para. 34; Netlog, para. 32. Scarlet Extended, para. 35; Netlog, para. 33. By contrast, according to the Belgian Supreme Court, an order imposing on ISPs to disable access to the content hosted by a server is not, in itself, incompatible with Art. 15(1) of the E-Commerce Directive. In this case an examining magistrate had ordered all the ISPs based in Belgium to block access to the content hosted by the server linked to the domain name of the well-known torrent site ‘The Pirate Bay’. The examining magistrate’s order required the ISPs to use ‘all known techniques’ to achieve this, ‘including at the very least the blocking of all domain names linked to the server of the domain name “thepiratebay.org”’. The ISPs were also ordered to ensure that visitors to the websites in question were re-directed to an IP address owned by the Belgian authorities, which explained to them why the domain names had been blocked. Three Belgian ISPs challenged the legality of this order before the Belgian courts. The claimants criticised the fact that the order was not expressly limited in time (as part of a criminal investigation, it was intended to remain in force until the criminal court had pronounced a judgment in the case). In addition, the claimants argued that the order breached Art. 52(1) of the EU Charter of Fundamental Rights because the measures it ordered them to take were insufficiently clear, to the extent that it did not precisely define the measures that the ISPs had to implement to comply with it, nor did it provide an exhaustive list of the domain names concerned. The ISPs also requested the Supreme Court to refer the case to the CJEU for a preliminary ruling on the compatibility of the disputed order with Art. 15(1) of the E-Commerce Directive. The Supreme Court dismissed all these claims. It confirmed the legality of the examining magistrate’s order. In the Court’s opinion, the measures in question did not impose any general monitoring obligation on the ISPs: the order merely required them to block access to a group of domain names that could easily be identified without having to investigate their content (‘Hof van Cassatie’/‘Cour de Cassation’, 22 October 2013, Telenet, case No P.13.0550.N/1). Scarlet Extended, para. 36; Netlog, para. 34. According to certain sources, the initial cost of implementing a simple website-blocking injunction is about €1,200, with another €120 for each subsequent notification. See M. Husovec (‘Injunctions against Innocent Third Parties’, n 169 above), 4, referring to the decision of the UK High Court of Justice in the Newzbin II case [2011] EWHC 2714 (Ch), paras 32–53. According to current practice in the EU Member

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IPRED, the Data Protection Directive,426 and the E-Privacy Directive,427 read together and construed in the light of the requirements stemming from the protection of the applicable fundamental rights (such as the right to conduct a business, the right to protection of personal data, and the freedom to receive or impart information), preclude a national court from issuing an injunction against an ISP or a hosting service provider which requires it to install a system of filtering all electronic communications passing through the ISP’s services (in particular, those involving the use of peer-to-peer software) or information which is stored on the hosting service provider’s servers by its service users, which applies indiscriminately to all of those users, as a preventive measure, exclusively at its expense and for an unlimited period, which is capable of identifying electronic files containing works in respect of which the plaintiff claims to hold copyright protection. The Court held that an injunction requiring the installation of the contested filtering system would involve monitoring all (or most) of the electronic communications made through the network of the ISP concerned or all (or most) information stored on the hosting service provider’s servers, in the interests of the right holders. Moreover, that monitoring would have no limitation in time, would be directed at all future infringements and would be intended to protect not only existing works, but also future works that have not yet been created at the time when the system is introduced. Accordingly, such an injunction would result in a serious infringement of the freedom of the service providers concerned to conduct their business since it would require them to install a complicated, costly, permanent computer system at their own expense. This would also be contrary to the conditions laid down in Article 3(1) of the IPRED, which requires that measures to ensure the respect of IPRs should not be unnecessarily complicated or costly. The Court concluded that the injunction to install the contested filtering system was to be regarded as not respecting the requirement that a fair balance be struck between, on the one hand, the protection of the IPRs enjoyed by copyright holders, and, on the other hand, that of the freedom to conduct a business enjoyed by operators such as ISPs or hosting service providers. Moreover, the effects of that injunction would not be limited to the operators concerned, as the contested filtering system could also infringe the fundamental rights of those operators’ customers, namely their right to protection of their personal data and their freedom to receive or impart information, which are rights safeguarded by Articles 8 and 11 of the EU Charter of Fundamental Rights respectively; indeed, that system might not distinguish adequately between unlawful content and lawful content, with the result that its introduction could lead to the blocking of lawful communications.428 21.163 It appears from the above judgments that filtering systems, to be respectful of internet users’ fundamental rights, should: (i) not allow the identification, systematic analysis or processing of data connected with user profiles created on social networks (otherwise they would be in breach of users’ rights to the protection of their personal data); and (ii) be able to distinguish between legal and

States, such costs are mostly borne by ISPs. Husovec emphasises that, although it would theoretically be possible to see injunctions against intermediaries being issued only on the promise that right holders will pay the implementation costs, neither the IPRED nor the InfoSoc Directive explicitly envisages this scenario. In the Newszbin II case, Justice Arnold opines: [i]t seems to me to be implicit in recital 59 of the Information Society Directive that the European legislature has chosen to impose that cost on the intermediaries. Furthermore, that interpretation seems to be supported by the Court of Justice’s statement in L’Oréal v. eBay at para. 139 that such measures ‘must not be excessively costly’.

426 427 428

On the other hand, Husovec stresses that there is no explicit requirement in any of the Directives either that such costs have to be borne fully by intermediaries. In the Scarlet Extended and Netlog cases, the CJEU insisted on the fact that the cost of implementing injunctions may not be excessive for the intermediaries concerned either. For an example of a case where the costs of the implementation of a DNS blocking order were put on the claimants (copyright owners), see Paris ‘Tribunal de Grande Instance’, 28 November 2013 (summary proceedings), case No 11/60013, Association des Producteurs de Cinéma (APC) and others v. Auchan Telecom and others. Directive 95/46. This Directive has in the meantime been replaced by Regulation 2016/679: see n 414 above. Directive 2002/58. Scarlet Extended, paras. 47–53; Netlog, paras. 45–51.

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illegal content to avoid the blocking of lawful communications (otherwise they would be in breach of users’ freedom of information). In addition, ISPs should not be compelled to install complicated, costly and permanent software at their own expense (as this would be in breach of their right to conduct a business and would violate Article 3(1) of the IPRED).429 Promusicae and Bonnier Audio AB The right of information set out in Article 8 of the IPRED is crucial for right holders, since it 21.164 enables them to determine the identity of the infringer to take legal steps against the latter. Information about distribution networks can enable right holders to track down infringing products or services and ensure that they are removed from the supply chain and that wholesalers/retailers are notified before the product goes to market or the services are rendered. It is critical that this information can be obtained from intermediaries. As regards infringements committed on the internet, ISPs are the only possible source of information regarding the identity of the infringer. In practice, many requests for information from third parties are thus directed towards ISPs. In some Member States, however, the right of information seems to be granted very restrictively, mainly due to national laws on the protection of personal data.430 For example, in cases of copyright infringement in the digital environment, when right holders try to identify the infringers, their requests are often superseded, and therefore blocked, by the privacy laws. The rules regarding data retention are also unclear, and often restrict the ability of right holders to apply for an order against ISPs by requiring them to disclose the identity of the account holder through whom infringing material has been made available.431 This is particularly the case for IPR infringements committed via the internet.432 Consequently, ISPs and other parties do not know whether they have a legal basis to store the data, or for how long they should store it. National laws have been adopted in this area in a number of Member States, but these are sometimes limited to the data to be provided to the public authorities, and primarily for the purposes of prosecuting criminal offences. Specifically in relation to the digital environment, the CJEU held, in the Promusicae case,433 that the 21.165 EU acquis (including the Data Protection Directive in force at the time, the E-Commerce Directive, the E-Privacy Directive, and the IPRED) does not require the Member States to lay down an obligation to communicate personal data in order to ensure effective protection of copyrights in the context of civil proceedings. However, it does not preclude them from doing so, provided that some safeguards are put in place. The issue of the compatibility between Article 8 of the IPRED and the Data Retention Directive434 21.166 was referred to the CJEU in Case C-461/10 Bonnier Audio AB.435 The CJEU was asked, in essence, whether the Data Retention Directive, and in particular Articles 3, 4, 5, and 11 thereof, preclude the application of a national provision which is based on Article 8 of the IPRED and which permits ISPs in civil proceedings, in order to identify a particular subscriber, to be ordered to give a copyright holder or its representative information on the subscriber to whom the ISP provided a specific IP address, which address, it is claimed, was used in the infringement. The question was

429 430

431 432 433 434 435

Lory and Hecˇko, n 169 above, 93. ‘Study on Online Copyright Enforcement and Data Protection in Selected Member States’, commissioned by the European Commission’s DG MARKT, Hunton & Williams Brussels, . Report on ‘Evidence and Right of Information’ drafted by the Sub-group on Legal Framework of the European Observatory on Counterfeiting and Piracy, n 284 above. Commission Staff Working Document on the application of the IPRED (n 151 above), 12. Case C-275/06 Productores de Música de Espána (Promusicae) v. Telefónica de Espána SAU, ECLI:EU:C:2008:54, judgment of 28 January 2008. Dir. 2006/24 on data retention. Case C-461/10 Bonnier Audio AB and Others v. Perfect Communication Sweden AB, ECLI:EU:C:2012:219, judgment of 19 April 2012.

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based on the assumption that the applicant has adduced evidence of the infringement of a particular copyright and that the measure is proportionate. First, the Court found that the Data Retention Directive only deals with information disclosure orders at the request of public authorities, as opposed to individuals, and with a view to prosecuting criminal offences.436 Therefore, it does not preclude the application of national legislation based on Article 8 of the IPRED which, in order to identify an internet subscriber or user, permits an ISP in civil proceedings to be ordered to give a copyright holder or its representative information on the subscriber to whom the ISP provided an IP address which was allegedly used in an infringement. Secondly, the Court confirmed that the names and addresses of the alleged infringers who are to be identified on the basis of their IP addresses are personal data.437 The legislation governing the protection of personal data was therefore applicable. Next, the Court recalled its earlier case law, according to which Article 8(3) of the IPRED, read in conjunction with Article 15(1) of the Data Protection Directive,438 does not preclude Member States from imposing an obligation to disclose to private persons personal data in order to enable them to bring civil proceedings for copyright infringements.439 However, when transposing the E-Privacy Directive and the IPRED into national law, the Member States must ensure that they rely on an interpretation of those Directives which allows a fair balance to be struck between the various fundamental rights protected by the EU legal order. Furthermore, when implementing the measures transposing those Directives, the authorities and courts of Member States must not only interpret their national law in a manner consistent with them, but must also make sure that they do not rely on an interpretation of them which would conflict with those fundamental rights or with the other general principles of EU law, such as the principle of proportionality.440 A national legislation which requires that, for an order for disclosure of the data in question to be made, there be clear evidence of an infringement of an IPR, that the information can be regarded as facilitating the investigation into an infringement of copyright or impairment of such a right, and that the reasons for the measure outweigh the nuisance or other harm which the measure may entail for the person affected by it or for some other conflicting interest, does enable the national court seised of an application for an order for disclosure of personal data to weigh the conflicting interests involved, on the basis of the facts of each case and taking due account of the requirements of the principle of proportionality. Such legislation must, therefore, be regarded as likely, in principle, to ensure a fair balance between the protection of IPRs enjoyed by copyright holders and the protection of personal data enjoyed by internet subscribers or users.441 UPC Telekabel Wien 21.167 It is also worth mentioning in this section the CJEU’s judgment in the UPC Telekabel case.442 This case was between an Austrian ISP, UPC Telekabel GmbH (defendant), and Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft GmbH (plaintiffs). The plaintiffs had asked UPC Telekabel to block access to the website kino.to, where internet users could watch films whose copyright they owned. All parties to the case agreed that the content of the website kino.to was infringing. When the defendant failed to act on their request, the plaintiffs began proceedings before the Handelsgericht Wien (Vienna Commercial Court) requesting a court order forbidding the defendant from allowing its clients access to the website. The court issued the court order as requested, instructing the defendant to block DNS access to the domain and to all current and 436 437 438 439

440 441 442

Ibid., paras 51–52. Ibid., paras 38–45. Now Art. 23(1) of the General Data Protection Regulation. Case C-461/10 Bonnier Audio, para. 55, referring to the judgment in Case C-275/06 Promusicae, paras 54–55, and the Order in Case C-557/07, LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten GmbH v. Tele2 Telecommunication GmbH, ECLI:EU:C:2009:107, judgment of 19 February 2009. Judgment in the Bonnier Audio AB case, para. 56, referring to the judgment in Promusicae, paras 68 and 55, and the order in LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten, para. 28. For a recent contribution on the tensions between data protection and IPR enforcement, see Fossoul, n 158 above, 15. Case C-314/12, UPC Telekabel Wien GmbH, n 166 above.

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future IP addresses referring to the disputed website of which the defendant was, or could, become aware. The defendant appealed against the court order to the Oberlandesgericht Wien (Vienna Higher Regional Court). The latter amended the original court order and prohibited access to the website without specifying the concrete means of implementing this prohibition. The judgment in appeal thus involved an obligation for the defendant to provide a result, i.e. to prevent the infringement of the plaintiffs’ IPRs; however, the court left it to the defendant to choose the means by which this result would be obtained. The defendant appealed in revision to the Oberste Gerichtshof (Supreme Court), which stayed its judgment and referred a number of questions to the CJEU for a preliminary ruling. The Austrian Supreme Court’s first question to the CJEU was whether or not Article 8(3) of the 21.168 InfoSoc Directive allowed national courts to issue orders against an ISP when the latter had not provided internet access to an individual who had infringed a copyright, but rather to internet users who were likely to view illicit content. The Court answered this question in the affirmative. It recalled that Article 8(3) of the InfoSoc Directive did not explicitly require the existence of a contractual relationship between the ISP and the copyright infringer.443 UPC Telekabel played a key part in the ‘making available to the public’ of the copyrighted works and its services were thus ‘used’ by the copyright infringers to infringe the copyright.444 According to the Court, this interpretation was in line with the intention of the legislator of ensuring a high level of protection of copyrights.445 The Austrian Supreme Court’s third question was whether or not a court order which forbade an 21.169 ISP, in very general terms without prescription of concrete measures, from granting its clients access to a specific website which infringed copyright, was compliant with the balance of the parties’ fundamental rights. The Court disagreed in this regard with its Advocate General. In the latter’s opinion, the prohibition against a specific result (known in Austria as ‘Erfolgsverbot ’) without any indication of the measures required to achieve this result, when addressed to an ISP which had no contractual relationship with the copyright infringer, was not compliant with the CJEU’s case law on the application of Article 8(3) of the InfoSoc Directive.446 This was also the case when the ISP was able to avoid any penalty for breaching the injunction imposed on it by providing evidence that it had taken all reasonable measures to comply with it.447 Although, by virtue of the 59th Recital of the InfoSoc Directive, the conditions and modalities of injunctions imposed on intermediaries have to be specified in the national law of the Member States, they are not entirely left to the Member States to decide. Indeed, such national provisions, and their application by the national courts, must respect the ceilings laid down in the InfoSoc Directive and the IPRED, as well as the legal sources to which those Directives refer, including, inter alia, the E-Commerce Directive.448 In addition, fundamental rights must also also be taken into consideration, in accordance with Article 51(1) of the Charter.449

443 444 445 446

447 448 449

Ibid., paras 34–35. Ibid., para. 32. Ibid., para. 31. The Court refers, in this regard, in particular, to Recital 9 of the InfoSoc Directive. In the opposite sense, see Paris ‘Tribunal de Grande Instance’, 28 November 2013, APC v. Auchan Telecom (n 425 above). In this case, however, the Court had not provided for any penalty in the case of a breach of the injunction imposed on the defendants. Opinion of Advocate General Cruz Villalón of 26 November 2013 in UPC Telekabel, ECLI:EU:C:2013:781, para. 71. Ibid., paras 72–3. The Advocate-General refers, on this point, to the CJEU’s judgment in the Scarlet Extended case, para. 33. Art. 51(1) provides that: [t]he provisions of this Charter are addressed to the institutions, bodies, offices and agencies of the Union with due regard for the principle of subsidiarity and to the Member States only when they are implementing Union law. They shall therefore respect the rights, observe the principles and promote the application thereof in accordance with their respective powers and respecting the limits of the powers of the Union as conferred on it in the Treaties.

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21.170 The Court recalled that, according to the CJEU’s case law, a fair balance had to be ensured between the protection of intellectual property (Art. 17(2) of the Charter450), on the one hand, and the ISP’s right to freedom of information of internet users (Art. 11 of the Charter) and freedom to conduct a business (Art. 16 of the Charter), on the other hand.451 In this context, it is sufficient for the blocking measure to effectively target the illicit content and for there to be no risk of blocking access to legal content.452 The Court considered that, while an injunction that constrains its addressee in a manner which restricts the free use of the resources at his disposal, because it obliges him or her to take measures which may represent a significant cost for him or her, have a considerable impact on the organisation of his or her activities or require difficult and complex technical solutions, it does not seem to infringe the very substance of the freedom of an ISP to conduct a business. First, since such an injunction leaves its addressee to determine the specific measures to be taken in order to achieve the result sought, he or she can choose to put in place measures which are best adapted to the resources and abilities available to him or her and which are compatible with the other obligations and challenges which he or she will encounter in the exercise of his or her activity. Secondly, such an injunction allows its addressee to avoid liability by proving that he has taken all reasonable measures. That possibility of exoneration clearly has the effect that the addressee of the injunction will not be required to make unbearable sacrifices. In that regard, in accordance with the principle of legal certainty, it must be possible for the addressee of an injunction such as that at issue in this case to maintain before the court, once the implementing measures which he or she has taken are known and before any decision imposing a penalty on him or her is adopted, that the measures taken were indeed those which could be expected of him or her in order to prevent the proscribed result. Having said that, the Court highlighted that, when the addressee of such an injunction chooses the measures to be adopted in order to comply with that injunction, he or she must ensure compliance with the fundamental right of internet users to freedom of information. In this respect, the measures adopted by the ISP must be strictly targeted, in the sense that they must serve to bring an end to a third party’s infringement of copyright or of a related right but without thereby affecting internet users who are using the provider’s services in order to lawfully access information. Failing that, the provider’s interference in the freedom of information of those users would be unjustified in the light of the objective pursued. Accordingly, the national procedural rules must provide a possibility for internet users to assert their rights before the courts once the implementing measures taken by the ISP are known.453 21.171 The Court further pointed out that, although it is possible that the enforcement of an injunction such as that at issue in this case will not lead to a complete cessation of the IPR infringements concerned, this does not render such an injunction ineffective or disproportionate. The Court agreed, in this regard, with its Advocate General.454 The addressee of such an injunction has the possibility of avoiding liability, and thus of not adopting some measures that may be achievable, if those measures are not capable of being considered reasonable. In addition, it may happen that a means of putting a complete end to the infringements does not exist or is not in practice achievable, as a result of which some measures taken might be capable of being circumvented in one way or another. The Court noted, in this regard, that there is nothing whatsoever in the wording of Article 17(2) of the Charter to suggest that the right to intellectual property is inviolable and must 450 451 452 453 454

See, in this regard, the CJEU’s judgment of 12 September 2006 in Case C-479/04, Laserdisken, ECLI:EU:C:2006:549, para. 65. CJEU, Case C-314/12, UPC Telekabel Wien GmbH v. Constantin Film Verleih GmbH & Wega Filmproduktionsgesellschaft GmbH, judgment of 27 March 2014 (n 442 above), para. 47. See, on the point of potential collateral damages from a blocking measure, ECtHR, Yıldırım v. Turkey, 18 December 2012, Application No 3111/10. Case C-314/12, UPC Telekabel Wien GmbH, n 166 above, paras 48–57. Opinion of Advocate General Cruz Villalón in Case C-314/12, UPC Telekabel Wien GmbH, ibid., paras 99–102. A similar approach was followed by the Paris ‘Tribunal de Grande Instance’ in its judgment of 28 November 2013 in the APC v. Auchan Telecom case, n 425 above.

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for that reason be absolutely protected. Nevertheless, the measures which are taken by the addressee of an injunction when implementing that injunction must be sufficiently effective to ensure genuine protection of the fundamental right at issue: they must have the effect of preventing unauthorised access to the protected subject matter or, at least, of making it difficult to achieve and of seriously discouraging internet users who are using the services of the addressee of that injunction from accessing the subject matter made available to them in breach of that fundamental right. Consequently, even though the measures taken when implementing an injunction are not capable of leading, in some circumstances, to a complete cessation of the infringements at issue, they cannot however be considered to be incompatible with the requirement that a fair balance be found, in accordance with Article 52(1), in fine, of the Charter,455 between all applicable fundamental rights, provided that: (i) they do not unnecessarily deprive internet users of the possibility of lawfully accessing the information available; and (ii) that they have the effect of preventing unauthorised access to protected subject matter or, at least, of making it difficult to achieve and of seriously discouraging internet users who are using the services of the addressee of that injunction from accessing the subject matter that has been made available to them in breach of the IPR.456 The Court did not address the question whether the Oberlandesgericht’s court order breached Article 21.172 15(1) of the E-Commerce Directive. However, the Advocate General considered that this was not the case. Indeed, the Austrian judge had not ordered UPC Telekabel to actively search for copies of the illicit webpage under other domain names, nor to filter all the data transferred on its network for parts of films and to block access to it. The blocking of access requested was merely of a specific website.457 The Advocate General continued by examining the necessity and proportionality of such blocking measures. In his view, a quantitative estimate of the efficiency of a blocking measure should be included in any analysis, along with its complexity, its cost, and its duration. In this context, consideration had to be given to the fact that the block would probably not be an isolated case aimed solely at the defendant. In the Advocate-General’s opinion, if one measure in particular could be considered to be disproportionate, given its complexity, cost, and duration, an analysis should be conducted to see if making all or part of such cost payable by the copyright holder would restore its proportionality.458 The Advocate General pointed out, in this regard, that it would be unfair to leave right holders without any protection when confronted with a website that massively infringes their rights. On the other hand, in the case under consideration, account had to be taken of the fact that UPC Telekabel had no contractual relationship with the owner of the illicit website. Whereas, in such a case, it would not be unreasonable in all cases to hold the ISP to account, the copyright owner should, whenever possible, take action in the first place against the owners of the illicit website or their own ISP.459

455

Art. 52(1) provides that: Any limitation on the exercise of the rights and freedoms recognised by this Charter must be provided for by law and respect the essence of those rights and freedoms. Subject to the principle of proportionality, limitations may be made only if they are necessary and genuinely meet objectives of general interest recognised by the Union or the need to protect the rights and freedoms of others.

456 457 458

459

Case C-314/12, UPC Telekabel Wien GmbH, n 166 above, paras 58–63. Opinion of Advocate General Cruz Villalón of 26 November 2013 in Case C-314/12, UPC Telekabel Wien GmbH, ibid., para. 78. Ibid., paras 103–106. For an example of a case where the costs of the implementation of a DNS blocking order were put on the claimants (copyright owners), see Paris ‘Tribunal de Grande Instance’, 28 November 2013 (summary proceedings), APC v. Auchan Telecom (n 425 above). The court also refused to award any compensation for lawyer’s fees to the plaintiffs. Opinion of Advocate General Cruz Villalón, ibid., para. 107. In its judgment of 28 November 2013, the Paris ‘Tribunal de Grande Instance’, ibid., disagreed with this approach. In its view, Art. 8(3) of the InfoSoc Directive does not provide for any kind of ‘subsidiarity principle’.

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Mc Fadden 21.173 The principles highlighted by the CJEU in the UPC Telekabel case were reaffirmed in the Mc Fadden case. In this case, the Court held that an injunction which requires, on payment of a fine, a communication network access provider to prevent third parties from making a particular copyright-protected work or parts thereof available to the general public from an online P2P exchange platform via the internet connection available in that network, where that provider may choose which technical measures to take in order to comply with the injunction, even if such a choice is limited to a single measure consisting in password-protecting the internet connection, provided that those users are required to reveal their identity in order to obtain the required password, was capable of striking a fair balance between, first, the fundamental right to protection of intellectual property and, second, that provider’s right to freedom to conduct a business and the right to freedom of information of the recipients of the service.460 In this case, according to the referring court, there were only three measures that the service provider could, in practice, take in order to comply with the injunction, namely examining all communications passing through an internet connection, terminating that connection, or password-protecting it. The CJEU pointed out that the first measure had to be ruled out from the outset as contrary to Article 15(1) of the E-Commerce Directive,461 which excludes the imposition of a general obligation on, inter alia, communication network access providers to monitor the information that they transmit.462 Regarding the first measure, the Court found that terminating the internet connection completely would seriously encroach upon the service provider’s freedom to conduct a business. Indeed, it would prevent the addressee of the injunction from providing internet access in order to remedy a limited infringement of copyright without considering the adoption of measures less restrictive of that freedom. Therefore, such a measure cannot be regarded as complying with the requirement of ensuring that a fair balance is struck between the fundamental rights which must be reconciled.463 By contrast, a measure consisting in password-protecting an internet connection would not damage the essence of the right to conduct its business of a communication network access provider, insofar as the measure is limited to marginally adjusting one of the technical options open to the provider in exercising its activity. Neither does it appear to be such as to undermine the essence of the right to freedom of information of the recipients of the internet network access service: to the extent that that measure is limited to requiring such recipients to request a password, does not block any internet website and the connection constitutes only one of the several means of accessing the internet, it does not affect the possibility made available to internet users using the services of the addressee of the injunction to access information lawfully.464 Next, a measure intended to secure an internet connection by means of a password is effective to ensure genuine protection of the IPRs at issue, as it may dissuade the users of that connection from infringing copyright or related rights, provided that those users are required to reveal their identity in order to obtain the required password and may not therefore act anonymously.465 Finally, in the absence of alternative measures less restrictive of the service provider’s and internet users’ fundamental rights and freedoms, a measure consisting in password-protecting an internet connection must be considered to be necessary in order to ensure the effective protection of the fundamental right to protection of intellectual property.466

460 461 462 463 464 465 466

CJEU, Case C484/14, Tobias Mc Fadden v. Sony Music Entertainment Germany GmbH, ECLI:EU:C:2016:689, judgment of 15 September 2016, paras 100–101. See above, paras. 21.162 ff. Case C484/14, Mc Fadden, n 460 above, para. 87. Ibid., paras 88–89. Ibid., paras 90–94. Ibid., paras 95–96. Ibid., paras 97–99.

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The Council of Europe and the ECtHR The Council of Europe467 is an international organisation founded in 1949 promoting cooperation 21.174 between all countries of Europe in the areas of legal standards, human rights, democratic development, the rule of law, and cultural cooperation. It has 47 Member States. The Council of Europe cannot make binding laws. Recommendations of the Committee of Ministers Although the Council of Europe is an entirely separate body from the EU, it has adopted several 21.175 Recommendations about freedom of speech on the internet which are worthy of note here. Seven of the Committee of Ministers’ Recommendations to Member States are particularly relevant to the fight against illegal internet content:468 (i)

Recommendation CM/Rec(2012)3 of 4 April 2012 on the protection of human rights with regard to search engines states that ‘the filtering and blocking of Internet content by search engine providers entails the risk of violation of freedom of expression guaranteed by Article 10 of the Convention in respect to the rights of providers and users to distribute and access information’,469 and that: search engine providers should not be obliged to monitor their networks and services proactively in order to detect possibly illegal content, nor should they conduct any ex ante filtering or blocking activity, unless mandated by court order or by a competent authority. However, there may be legitimate requests to remove specific sources from their index, for example in cases where other rights outweigh the right to freedom of expression and information; the right to information cannot be understood as extending the access to content beyond the intention of the person who exercises her or his freedom of expression;470

(ii)

Recommendation CM/Rec(2007)16 of 7 November 2007 on measures to promote the public-service value of the internet is the only one to touch upon the difficult balance between freedom of expression and IPRs. It states that Member States: should affirm freedom of expression and the free circulation of information on the internet, balancing them, where necessary, with other legitimate rights and interests, in accordance with Article 10, paragraph 2, of the European Convention on Human Rights as interpreted by the European Court of Human Rights, by: […] (a) not subjecting individuals to any licensing or other requirements having a similar effect, nor any general blocking or filtering measures by public authorities, or restrictions that go further than those applied to other means of content delivery; (b) facilitating, where appropriate, ‘re-users’, meaning those wishing to exploit existing digital content resources in order to create future content or services in a way that is compatible with respect for intellectual property rights; […].471

(iii)

Recommendation CM/Rec(2008)6 of 28 March 2008 on measures to promote the respect for freedom of expression and information with regard to internet filters urges the Member States to:

guarantee that nationwide general blocking or filtering measures are only introduced by the state if the conditions of Article 10, paragraph 2, of the European Convention on Human Rights are fulfilled. Such action by the state should only be taken if the filtering concerns specific and clearly identifiable content, a competent national authority has taken a decision on its illegality and the decision can be reviewed by an

467 468 469 470 471

. It is worth noting, in this context, that the EU participates in the meetings of the Council of Europe’s Committee of Ministers. Recommendation CM/Rec(2012)3, , para. 12. Ibid., para. 13. Recommendation CM/Rec(2007)16, III, .

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Chapter 21 THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY independent and impartial tribunal or regulatory body, in accordance with the requirements of Article 6 of the European Convention on Human Rights’;472

(iv)

The Explanatory Memorandum to Recommendation CM/Rec(2014)6 of 16 April 2014 on a Guide to human rights for internet users deals with blocking and filtering measures as well as de-indexation of internet content. It highlights that:

49. Nationwide general blocking or filtering measures might be taken by State authorities only if the filtering concerns specific and clearly identifiable content, based on a decision on its illegality by a competent national authority which can be reviewed by an independent and impartial tribunal or regulatory body in accordance with the requirements of Article 6 of the ECHR. State authorities should ensure that all filters are assessed both before and during their implementation to ensure that their effects are proportionate to the purpose of the restriction and thus necessary in a democratic society, in order to avoid unjustified blocking of content. 50. Measures taken to block specific Internet content must not be arbitrarily used as a means of general blocking of information on the Internet. They must not have a collateral effect in rendering large quantities of information inaccessible, thereby substantially restricting the rights of Internet users. They should be prescribed by law. There should be strict control of the scope of blocking and effective judicial review to prevent any abuse of power. Judicial review of such a measure should weigh-up the competing interests at stake, strike a balance between them and determine whether […] a less far-reaching measure could be taken to block access to specific Internet content. The requirements and principles mentioned above do not prevent the installation of filters for the protection of minors in specific places where minors access the Internet such as schools or libraries. 51. Filtering and de-indexation of Internet content by search engines entails the risk of violating the freedom of expression of Internet users. Search engines have freedom to crawl and index information available on the World Wide Web. They should not be obliged to monitor their networks and services proactively in order to detect possibly illegal content and should not conduct any ex-ante filtering or blocking activity unless mandated by a court order or by a competent authority. Deindexation or filtering of specific websites at the requests of public authorities should be transparent, narrowly tailored and reviewed regularly subject to compliance with due process requirements;473

(v)

Recommendation CM/Rec(2015)6 of 1 April 2015 on the free transboundary flow of information on the internet recalls that: States are obliged to ensure that the blocking of content or services deemed illegal is in compliance with Articles 8, 10 and 11 of the ECHR. In particular, measures adopted by State authorities in order to combat illegal content or activities on the Internet should not result in an unnecessary and disproportionate impact beyond that State’s borders. States should strive to develop measures which are the least intrusive and least disruptive and implement them following a transparent and accountable process. Measures adopted or promoted by States should be regularly reviewed to determine their practical effectiveness and whether they are still necessary or proportionate;474

(vi)

The appendix to Recommendation CM/Rec(2016)5 of 13 April 2016 on internet freedom stresses that the Member States are to ensure that the following measures comply with the conditions of Article 10 of the ECHR regarding the legality, legitimacy and proportionality of restrictions: +

472 473 474

any measure taken by State authorities or private-sector actors to block or otherwise restrict access to an entire internet platform (social media, social networks, blogs or any

Recommendation CM/Rec(2008)6, III.ii, . Recommendation CM/Rec(2014)6, III.ii, . Recommendation CM/Rec(2015)6, 2. ‘Due diligence principles’, .

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+

other website) or information and communication technologies tools (instant messaging or other applications), or any request by State authorities to carry out such actions; any measures taken by State authorities or private-sector actors to block, filter or remove internet content, or any request by State authorities to carry out such actions.

It further adds that ISPs should in principle treat internet traffic equally and without discrimination on the basis of sender, receiver, content, application, service or device. Internet traffic management measures should be transparent, necessary and proportionate to achieve overriding public interests in compliance with Article 10 of the ECHR. Internet users or other interested parties must have access to a court in compliance with Article 6 of the ECHR with regard to any action taken to restrict their access to the internet or their ability to receive and impart content or information. The States, for their part, must provide information in a timely and appropriate manner to the public about restrictions it applies to the freedom to receive and impart information, such as indicating websites that have been blocked or from which information was removed, including details of the legal basis, necessity and justification for such restrictions, the court order authorising them and the right to appeal.475 (vii) Finally, the ‘Guidelines for States on actions to be taken vis-à-vis internet intermediaries with due regard to their roles and responsibilities’ annexed to Recommendation CM/Rec(2018)2 of 7 March 2018 on the roles and responsibilities of internet intermediaries reiterates that any request, demand or other action by public authorities addressed to internet intermediaries to restrict access (including blocking or removal of content), or any other measure that could lead to a restriction of the right to freedom of expression, must be prescribed by law, pursue one of the legitimate aims foreseen in Article 10 of the Convention, be necessary in a democratic society and be proportionate to the aim pursued.476 The Guidelines further recall that State authorities should avoid any action that may lead to general content monitoring,477 and emphasise that, except in those cases where the content is illegal irrespective of context (such as content involving child sexual abuse material), State authorities should in principle always obtain an order by a judicial authority or other independent administrative authority, whose decisions are subject to judicial review, when demanding intermediaries to restrict access to content.478 Regarding internet intermediaries’ liability, the Guidelines prescribe that: States should ensure, in law and in practice, that intermediaries are not held liable for third-party content which they merely give access to or which they transmit or store. State authorities may hold intermediaries co-responsible with respect to content that they store if they do not act expeditiously to restrict access to content or services as soon as they become aware of their illegal nature, including through notice-based procedures. State authorities should ensure that notice-based procedures are not designed in a manner that incentivises the take-down of legal content, for example due to inappropriately short timeframes. Notices should contain sufficient information for intermediaries to take appropriate measures. Notices submitted by States should be based on their own assessment of the illegality of the notified content, in accordance with international standards. Content restrictions should provide for notice of such restriction being given to the content producer/issuer as early as possible, unless this interferes with ongoing law-enforcement activities. Information should also be made available to users seeking access to the content, in accordance with applicable data protection laws;479

475 476 477 478 479

Recommendation CM/Rec(2016)5, 2.2 ‘Freedom of opinion and the right to receive and impart information’, . Recommendation CM/Rec(2018)2, . Ibid, 1.3.5. Ibid, 1.3.2. Ibid, 1.3.7.

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With regard to automated means of content identification, the Guidelines specify that the Member States should take account of the fact that those means currently have a limited ability to assess context.480 Last but not least, they advocate close cooperation between State authorities and internet intermediaries: In order to ensure that illegal content – as determined either by law or by a judicial authority or other independent administrative authority whose decisions are subject to judicial review – is effectively prevented from being accessed, States should co-operate closely with intermediaries to secure the restriction of such content in line with the principles of legality, necessity and proportionality. […]

This Recommendation also contains some guidance on content moderation along the same lines.481 Case law of the ECtHR 21.176 In the wake of these Recommendations, the ECtHR has rendered several judgments to date which refer to the conciliation of the protection of the fundamental right to freedom of expression, as enshrined in Article 10 of the ECHR, on the one hand, and measures to filter or block internet content, on the other hand.482 21.177 In its judgment of 2 December 2008 in K U v. Finland, the ECtHR stressed that: although freedom of expression and confidentiality of communications are primary considerations and users of telecommunications and internet services must have a guarantee that their own privacy and freedom of expression will be respected, such guarantee cannot be absolute and must yield on occasion to other legitimate imperatives, such as the prevention of disorder or crime or the protection of the rights and freedoms of others. Without prejudice to the question whether the conduct of the person who placed the offending advertisement on the internet can attract the protection of Articles 8 and 10, having regard to its reprehensible nature, it is nonetheless the task of the legislator to provide the framework for reconciling the various claims which compete for protection in this context’.483

21.178 In its judgment of 10 March 2009 in Times Newspapers v. United Kingdom (Nos 1 and 2), the Court further recalled that: Article 10 guarantees not only the right to impart information but also the right of the public to receive it (see The Observer and The Guardian v. the United Kingdom, 26 November 1991, § 59(b), Series A no. 216; Guerra and Others v. Italy, 19 February 1998, § 53, Reports of Judgments and Decisions 1998-I). In light of its accessibility and its capacity to store and communicate vast amounts of information, the internet plays an important role in enhancing the public’s access to news and facilitating the dissemination of information generally. The maintenance of internet archives is a critical aspect of this role and the Court therefore considers that such archives fall within the ambit of the protection afforded by Article 10.484

21.179 In its judgment of 5 May 2011 in Pravoye Delo Editorial Team and Shtekel v. Ukraine, the Court ruled ‘that the absence of a sufficient legal framework at the domestic level allowing journalists to use information obtained from the internet without fear of incurring sanctions seriously hinders the exercise of the vital function of the press as a “public watchdog”’.485

480 481 482

483 484 485

Ibid, 1.3.8. Ibid., 2.3. Other judgments regarding the freedom of expression and information in internet-related cases include Editorial Board of Pravoye Delo and Shtekel v. Ukraine, Application No 33014/05 (5 May 2011), Mouvement Raëlien Suisse v. Switzerland, Application No 16354/06 (13 July 2012), Szima v. Hungary, Application No 29723/11 (9 October 2012), Peta Deutschland v. Germany, Application No 43481/09 (8 November 2012). ECtHR, K U v. Finland, Application No 2872/02. Times Newspapers Ltd. v. United Kingdom (Nos 1 and 2), Applications No 3002/03 and 23676/03, para. 27. Pravoye Delo Editorial Team and Shtekel v. Ukraine, Application No 33014/05, paras. 64–65.

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In its judgment of 18 December 2012 Ahmet Yıldırım v. Turkey,486 which is the first to address the 21.180 freedom of expression on Web 2.0 platforms, the ECtHR unanimously decided that restrictions on internet access outside a strict legal framework regulating the scope of the restriction and affording the guarantee of judicial review to prevent possible abuses, amount to breaches of the freedom of expression. In this case, a Turkish court had ordered, as an interim measure (i.e., prior to any decision on the merits of the case), to block access to a website whose owner had posted content insulting the memory of the founder of the Turkish Republic, Mustafa Kemal Atatürk, which is a criminal offence in Turkey. When the administrative body in charge of the enforcement of the order told the court that the only way of blocking access to the website was to block access to Google Sites as a whole, the court adapted its order accordingly. As a result, access to all other websites hosted by Google Sites was blocked as well. Complaining that he was no longer able to access his own (perfectly legal) website, Mr Yıldırım claimed that the court order infringed Article 10 of the ECHR. The ECtHR found that the Turkish court order amounted to interference by the public authorities with the applicant’s right to freedom of expression, which would be in breach of Article 10 unless it were prescribed by law, pursued one or more legitimate aims, and was necessary in a democratic society to achieve such aims. In order to be prescribed by law in the sense of Article 10, a measure must be ‘foreseeable’ in its application, which requires that it is formulated with sufficient precision to enable individuals to regulate their conduct.487 The ECtHR stressed that, when the national court had decided to bar access to Google Sites, it had simply referred to an opinion from the competent administrative enforcement body without ascertaining whether a less far-reaching measure could have been taken to block access specifically to the offending website. This was a consequence of domestic Turkish law, which did not require the courts to examine the necessity of the measure.488 The court should have had regard to the fact that the order would render large amounts of information inaccessible, thus directly affecting the rights of internet users and having a significant collateral effect. The interference resulting from the application of domestic Turkish law had thus failed to meet the foreseeability requirement under the ECHR and had not afforded the applicant the degree of protection to which he was entitled by the rule of law in a democratic society. The judicial review of the blocking of access had been insufficient to prevent abuses. The ECtHR nevertheless took care to make reference to its previous case law,489 under which a 21.181 court order restricting access to the internet was not, a priori, incompatible with the Convention, but could only be ordered as part of a particularly strict legal framework defining the ban and only if sufficient checks were in place to prevent abuse.490

486 487 488 489 490

Ahmet Yıldırım v. Turkey, Application No 3111/10. See para. 57 of the judgment, and the cited case law. Judgment, para. 66. Cf., inter alia, Association Ekin v. France, Application No 39288/98, para. 58. Judgment of 18 December 2012, Ahmet Yıldırım v. Turkey, n 486 above, para. 64. The ECtHR came to the same conclusion in its judgment of 15 December 2015 in the case of Cengiz and Others v. Turkey (applications Nos 48226/10 and 14027/11). In this case, the Ankara Criminal Court of First Instance had ordered the blocking of access to YouTube (a website enabling users to send, view and share videos) on the ground that the website contained some ten videos which, under Turkish law, were insulting to the memory of Atatürk (in total the YouTube website was blocked from 5 May 2008 to 30 October 2010, when the blocking order was lifted by the public prosecutor’s office following a request from the company owning copyright of the videos in question). The blanket blocking order had not directly targeted the applicants. However, the Court found that the latter, all academics in different universities, as active users of YouTube, could legitimately claim that the order in question had affected their right to receive and impart information and ideas. The Court went on to note that the blocking order had been imposed under section 8(1) of Turkish Law No 5651, and that, in its judgment of 18 December 2012, it had already found that this Law did not authorise the blocking of access to an entire internet site on account of one of its contents. The Court accordingly concluded that the interference with the right to freedom of expression and information had not satisfied the condition of lawfulness required by Art. 10 of the Convention.

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21.182 The Concurring Opinion of Judge Pinto De Albuquerque in Ahmet Yıldırım v. Turkey is particularly interesting, in that the judge attempted to provide general guidelines for dealing with future cases relating to the delicate balance between freedom of expression and the fight against illicit internet content. In light of the Committee of Ministers’ Recommendations detailed above and the practice of the ECHR’s signatory governments, in his opinion blocking access to the internet could only be compatible with the Convention provided that it complies with the following minimum conditions: + + + + + + + + + + +

the categories of individuals and institutions likely to have access to their publications blocked have been defined; the ‘target’ of the blocking order (e.g., websites, IP addresses, ports, network protocols, types of use such as social media, etc.) has been defined; the territorial scope of the blocking has been defined; a limit has been set on the duration of the blocking order; the ‘interests’ required by Article 10, paragraph 2, of the Convention, which justified a blocking order, have been defined; the blocking was ‘necessary’;491 the blocking was a proportionate sanction; the authorities competent to issue reasoned blocking orders have been defined; a procedure to be followed for the issuance of the blocking order has been defined, including, in principle, the right of interested parties to be heard; the blocking order and the grounds for it have been notified to the person or institution affected; and a judicial appeal procedure against the blocking order has been established.

In addition, the judge stated that the legal framework for blocking orders should be established via specific legal provisions, given that ‘neither the general provisions and clauses governing civil and criminal responsibility nor the E-Commerce Directive constitute a valid basis for ordering internet blocking’. As regards the principle of necessity, he considered that: any indiscriminate blocking measure which interferes with lawful content, sites or platforms as a collateral effect of a measure aimed at illegal content or an illegal site or platform fails per se the ‘adequacy’ test, in so

491

Interestingly, in this case the ECtHR determined that the applicants had victim status as required by the Convention. In that regard, it observed that the applicants had actively used YouTube for professional purposes, particularly downloading or accessing videos used in their academic work. It also observed that YouTube was a single platform which enabled information of specific interest, particularly on political and social matters, to be broadcast, and citizen journalism to emerge. It was therefore an important source of communication and the blocking order precluded access to specific information which it was not possible to access by other means. By contrast, in its judgment of 11 March 2014 in the case of Akdeniz v. Turkey (application No 20877/10), the Court found that the mere fact that the applicant, like the other Turkish users of the websites in question, had been indirectly affected by a blocking measure against two music-sharing websites was not sufficient for him to be regarded as a ‘victim’ of a violation of Art. 10 ECHR; these websites had been blocked because they did not comply with copyright legislation. The Court held that the applicant could without difficulty have had access to a range of musical works by numerous means without this entailing a breach of copyright rules. Moreover, the applicant had not alleged that the websites at issue disseminated information which could present a specific interest for him or that the blocking of access had had the effect of depriving him of a major source of communication. Accordingly, the blocking order had not prevented him from taking part in a debate on a matter of general interest. The Court, therefore, distinguished this case from that of Ahmet Yıldırım v. Turkey, and dismissed the application as inadmissible. Judge Pinto De Albuquerque did not hesitate to add, in this respect, that, ‘in the field of internet, […] some blocking orders may easily be circumvented, which makes the necessity of the measure questionable’ (Concurring Opinion, footnote 14). By contrast, as has been mentioned above, the CJEU took the view, in the UPC Telekabel case, that ordering an ISP to take a concrete blocking measure under Art. 8(3) of the InfoSoc Directive towards a specified website was not, in principle, ‘unnecessary’ or ‘disproportionate’, due to the mere facts that the implementation of such a measure required considerable resources and that it could easily be circumvented by users. See above, paras 21.170–21.171, in this regard.

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V. THE FIGHT AGAINST PIRACY ON THE INTERNET far as it lacks a ‘rational connection’, that is, a plausible instrumental relationship between the interference and the social need pursued. By the same token, blocking orders imposed on sites and platforms which remain valid indefinitely or for long periods are tantamount to pure censorship.492 When exceptional circumstances justify the blocking of illegal content, it is necessary to tailor the measure to the content which is illegal and to avoid targeting persons or institutions that are not de jure or de facto responsible for the illegal publication and have not endorsed its content. In the case of interim or preventive measures which are based on reasonable grounds to suspect the commission of a crime, freedom of expression warrants not only a ‘particularly tight legal framework’ (‘cadre legal particulièrement strict ’) but also the most careful scrutiny by the court, and consequently the exercise of special restraint.493

For the sake of completeness, it is also worth mentioning that, by judgment of 10 January 2013 in 21.183 the case of Ashby Donald and others v. France,494 the ECtHR unambiguously declared that copyright enforcement must be in accordance with Article 10 of the ECHR. In this case, three fashion photographers had been convicted for copyright infringement and ordered to pay substantial fines and damages in France for posting photographs taken by one of them on the website owned by the two others. The photographs had been taken at fashion shows without the fashion houses’ consent. The Court first recalled that the publication of photographs on the internet is covered by the right to freedom of expression,495 that the exceptions to this right provided in Article 10 of the ECHR had to be interpreted narrowly, and that the need for any such restrictions had to be established convincingly.496 More importantly, for the first time in a judgment on the merits, the Court held that a conviction based on copyright law for illegally reproducing or communicating to the public copyright protected works can be regarded as interfering with the right of freedom of expression and information of others. Such interference must, therefore, comply with the three conditions set out in Article 10 of the Convention. In other words, a conviction or any other judicial decision based on copyright law, restricting one’s freedom of speech, must be grounded on the law, pursue a legitimate aim, and be pertinently motivated as being necessary in a democratic society. The Court eventually concluded that the applicants’ conviction for breach of copyright and the award of damages was indeed in accordance with the conditions enshrined in Article 10. It found that the French courts had struck a fair balance between the rights to freedom of expression and information, on the one hand, and the right to property enshrined in Article 1 of the First Protocol to the ECHR – which, as the Court had already decided,497 is also applicable to intellectual property. It further stressed that a broad margin of appreciation had to be given to the national courts when assessing the compliance of a judicial order with Article 10 in this case, because the publication of the disputed photographs

492

493

Judge De Albuquerque mentions, in this context, that the excessive nature of a ban on future publication of entire newspapers, whose contents are unknown at the moment the order is issued by the national courts, was already established in Ürper and Others v. Turkey (ECtHR, Applications Nos 14526/07, 14747/07, 15022/07, 15737/07, 36137/07, 47245/07, and 50371/07, para. 43). In his opinion, the same conclusion applies to the blocking of a website or a web platform and thus of the publication of future articles whose content is unknown at the time of the decision to issue the blocking order. Thus the underlying justification in Ürper also applies to the blocking of websites and web platforms, and a fortiori to the blocking of collateral, legal websites and platforms (Concurring Opinion of Judge De Albuquerque, fn 21). The judge refers on this point, about the legal framework, to RTBF v. Belgium (ECtHR, Application No 50084/06, para. 115), where the Court had held that, if restrictions had to be applied to the press, they could only be applied within a particularly strict legal framework which limited the scope of the restrictions and contained effective judicial controls to prevent abuses. With regard to the exercise of judicial restraint, this was based on the judgment in The Observer and The Guardian v. United Kingdom (ECtHR, Application No 13585/88), para. 60: […] the dangers inherent in prior restraints are such that they call for the most careful scrutiny on the part of the Court. This is especially so as far as the press is concerned, for news is a perishable commodity and to delay its publication, even for a short period, may well deprive it of all its value and interest).

494 495 496 497

Application No 36769/08. Judgment in Ashby Donald and others v. France, para. 34. Ibid., para. 38. Melnychuk v. Ukraine, Application No 28743/03 (copyright-related case); ECtHR (Grand Chamber), Anheuser-Busch Inc. v. Portugal, Application No 73049/01 (trademark-related case).

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was not related to an issue of general interest for society. They had been published primarily for commercial purposes; besides, the mere communication of photographs of fashion shows to the public does not constitue participation in a debate affecting the general interest.498 Finally, the Court found that the fines (which ranged between 3,000 and 8,000 euro) and damages award (all together amounting to 255,000 euro) were not disproportionate to the legitimate aim pursued, in so far as the applicants had failed to establish that those measures had ‘financially strangled them’.499 21.184 As Professors Dirk Voorhoof and Inger Høedt-Rasmussen rightly state,500 the ECtHR’s judgment in Ashby Donald and others v. France adds an external human rights perspective to the justification of copyright enforcement; the Court clarifies that it is not sufficient to justify any judicial order restricting one’s artistic or journalistic freedom of speech solely on the basis that a copyright law provision has been infringed, or to consider that the unauthorised reproduction or public communication of copyright protected material cannot rely on one of the exceptions in the copyright law itself, including the application of the three-steps test laid down in Article 5(5) of the InfoSoc Directive. EDPS 21.185 On 22 February 2010, the EDPS rendered an interesting opinion on the negotiations of the ACTA concerning the legitimacy of internet monitoring (and of the subsequent disclosure of data by ISPs to right holders) in cases of clear-cut copyright infringement. It held that, ‘monitoring may be proportionate in the context of limited, specific, ad hoc situations where well-grounded suspicions of copyright abuse on a commercial scale exist. This criterion could encompass situations of clear copyright abuse by private individuals with the aim of obtaining direct or indirect economic commercial benefits’.501 As regards N&A procedures, the EDPS stressed, in another document released on 13 September 2012, that the EU should play a role in contributing to the functioning of such procedures, ‘preferably by providing harmonised detailed rules’.502 It also stressed that, in case the EU were to mandate hosting service providers to take proactive measures to prevent illegal content in the future, it should then be clarified what type of measures are referred to. Besides being lawful under the E-Commerce Directive and the E-Privacy Directive, the types of proactive measures sought from hosting providers should also be proportionate under the Data Protection Directive. 498

Judgment in Ashby Donald and others v. France, para. 39. As Dirk Voorhoof and Inge Høedt-Rasmussen put it: it would undoubtedly have been different if the pictures posted on the internet had contributed to a public debate e.g. on women’s rights in the world of fashion, or on public health issues related to anorexia and young girls being tempted to look like models in the glossy fashion magazines. In this case the photos were solely used in a commercial setting, while the pictures contained no further message than reproducing the images of the Paris fashion shows. It is not because the website or the media platform is part of a commercial company, that the invoked freedom of expression will receive a lower degree of protection from the scope of Article 10 of the Convention. What essentially matters is whether the publication, the article, the expression or the pictures contribute to a debate of general interest, a notion which is broadly interpreted by the European Court of Human Rights: ‘what constitutes a subject of general interest will depend on the circumstances of the case’ (ECtHR (Grand Chamber) 7 February 2012, Axel Springer Verlag AG v. Germany, § 90 […].

499 500 501

502

See D. Voorhoof and I. Høedt-Rasmussen, ‘Copyright vs. Freedom of Expression’, . In Mouvement Raëlien Suisse v Switzerland (n 482 above, para. 61), the ECtHR had already held that ‘[…] States have a broad margin of appreciation in the regulation of speech in commercial matters or advertising’. Judgment in Ashby Donald and others v. France, para. 43. ‘Copyright vs. Freedom of Expression’, n 498 above. Opinion of the European Data Protection Supervisor on the current negotiations by the European Union of an Anti-Counterfeiting Trade Agreement (ACTA) [2010] OJ C147/1, para. 44. By contrast, in a controversial judgment rendered on 12 April 2012, the German Federal Supreme Court ordered the disclosure of personal data even for small breaches of copyright, and set aside the ‘commercial scale’ criterion: see Fossoul, n 158 above, 15. EDPS, Comments of 13 September 2012 on DG MARKT’s public consultation on procedures for notifying and acting on illegal content hosted by online intermediaries, n 400.

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E. The DSM Directive The new EU Directive ‘on Copyright in the Digital Single Market’ intends to update existing 21.186 copyright laws for the internet age, in which music streaming services, video-on-demand platforms and news aggregators have become the primary access points to creative works and press articles, and the monetisation of copyrighted material has massively increased. Platforms such as YouTube and Facebook extract huge profits from the exploitation of content while currently, under the E-Commerce Directive, they do not have any responsibility for copyright infringements taking place on their platforms, other than to remove the content when it is brought to their attention. One of the Directive’s main objectives is to limit how copyright-protected works are used and 21.187 shared on the internet. Article 17 imposes greater responsibility on online content sharing service providers to ensure that the material being used on their sites does not violate copyright. The new measures are intended to increase online platforms’ and news aggregators’ responsibility to prevent unauthorised publications on their sites of copyright-protected material. Article 17 essentially seeks to make platforms responsible for taking down infringing material. As 21.188 soon as the Directive has been transposed into the Member States’ national laws, which, according to Article 26(1), is supposed to happen by 7 June 2021, the platforms covered by this provision will be considered to be carrying out acts covered by copyright, and therefore they will need to obtain an authorisation from the right holders concerned, when hosting copyright-protected material. In situations where there are no licensing agreements, the platforms will have to take certain actions if they want to avoid liability. More specifically, they will have to: (i) make best efforts to obtain an authorisation; (ii) make best efforts to ensure the unavailability of unauthorised content for which right holders have provided necessary and relevant information; and (iii) act expeditiously to remove any unauthorised content following receipt of a notice and also make best efforts to prevent future uploads. Newer and smaller platforms will benefit from a lighter regime, which will apply to online service 21.189 providers that: (i) have less than three years of existence in the Union; (ii) have a turnover of less than ten million euro;, and (iii) have less than five million monthly users. To avoid liability, such newer, smaller platforms will only have to prove that they have made their best efforts to obtain an authorisation and that they have acted expeditiously to remove the infringing content notified by right holders. Article 17 only applies to online content sharing service providers, defined in Article 2(6) of the 21.190 Directive as providers of an information society service whose main or one of the main purposes is to store and give the public access to a large amount of copyright protected works or other protected subject matter uploaded by their users which they organise and promote for profit-making purposes. Still according to Article 2(6), providers of services such as not-for profit online encyclopedias, not-for profit educational and scientific repositories, open source software developing and sharing platforms, electronic communication service providers, online marketplaces and business-to-business cloud services and cloud services which allow users to upload content for their own use shall not be considered online content sharing service providers within the meaning of this Directive.

By virtue of Article 17(7), uploading protected works for purposes of quotation, criticism, review, 21.191 caricature, parody or pastiche will not amount to an infringement, ensuring that memes and GIFs will continue to be freely available (and shareable) on online platforms. Article 15 of the Directive, for its part, is intended to make news aggregator sites pay publishers for 21.192 content used in the articles they post on their platforms. It does not cover use of individual words

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and very short extracts. Information society service providers will therefore remain free to use such parts of a press publication without requiring an authorisation by press publishers. 21.193 Those provisions are discussed in more detail in a separate chapter of this book.503

2. Non-legislative actions 21.194 Recital 29 of the IPRED emphasises that, next to legislative initiatives, the development of codes of conduct in the circles directly affected is a supplementary means of bolstering the regulatory framework on IPR enforcement in the digital environment. ‘The Member States, in collaboration with the Commission, should encourage the development of codes of conduct in general. […]’. Article 17 of the Directive further obliges the Member States to encourage the development, by trade or professional organisations, of codes of conduct at EU level that are aimed at contributing towards the enforcement of IPRs. The same applies under Article 16 of the E-Commerce Directive. All these provisions encourage cooperation between concerned private parties on a voluntary basis. 21.195 The Commission Staff Working Document on the application of the IPRED learns that, in several Member States, associations have made use of such a collaborative approach and have signed Memoranda of Understanding or have put in place codes of conduct or other voluntary arrangements to combat counterfeiting and piracy.504 It further appears from the Commission’s report that, in the area of the sale of counterfeit goods over the internet: intermediaries (for example online marketplaces such as online shopping sites) have realized that the presence and the sale of counterfeit goods via their sites undermines their efforts to be regarded as a safe place to buy and sell products and that their reputation is tarnished. In many cases, these intermediaries therefore have adopted comprehensive policies on the protection of intellectual property rights which are clearly spelled out on their sites. These policies include sanctions for users which breach the rules, in particular for the repeat infringers, comprehensive notice and take-down processes and other tools that allow a timely elimination of illegal offers, the sharing of information with rightholders and reimbursement schemes for consumers who unintentionally bought counterfeit goods on their site. All these measures have been applied without affecting the liability status of the intermediaries and have significantly contributed towards the elimination of counterfeiting on the internet; however, problems remain.505

21.196 The stakeholders’ dialogues initiated by the Commission in the EU506 have so far focused primarily on online IPR infringements, given the rapid progress of technological developments and the resulting need for practical technology-based solutions. The Commission has organised a structured dialogue between stakeholders to facilitate mutual understanding and to find solutions that could be in the interests of all concerned.

503 504 505

See Chapter 17. Commission Staff Working Document on the application of the IPRED (n 151 above), 25. Ibid., 15. See also ibid., fn 58: In Estonia, it has been reported that a Memorandum of Understanding was signed between Estonian Organisation of Copyright Protection and several Internet service providers to enable the removal of material that infringes intellectual property rights. In Denmark, Internet service providers together with the Danish IT Industry Association (ITB) and the Telecommunication Industries in Denmark (TI) have agreed to collaborate on combating piracy on the Internet and a Code of Conduct for Internet service providers concerning the enforcement of intellectual property rights has also been agreed. Similarly in France, the ‘Charte de lutte contre la contrefaçon sur Internet’ was signed between the French online marketplaces and rightholders to advance the fight against the sale of counterfeit goods over the Internet.

506

See para. 21.97 above.

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As a first example of the cooperative approach advocated by the Commission, the Stakeholders’ 21.197 Dialogue on the Sale of Counterfeit Goods over the Internet resulted, after two years of intense discussion, in an MoU signed on 4 May 2011 by 23 stakeholders operating at both global and regional level. The MoU507 is promoted in international fora such as WIPO,508 as well as in discussions with the EU’s main trading partners. It deals with issues such as prevention, identification, and removal of infringing offers (e.g., through N&A procedures) and sellers from internet platforms, repeat infringers,509 sharing of information510 between internet platforms and right holders, external communication and awareness-raising. It also includes a minimum set of consumer protection provisions, including the possibility of receiving a replacement product or a refund under certain circumstances. Finally, it ensures that signatories do not initiate new litigation against each other concerning matters covered by the MoU. The agreement aims at reducing the sale of counterfeit goods via e-commerce platforms; it does not seek to combat illegal sharing of copyright protected works via the internet. However, the concept of ‘counterfeit goods’ is defined broadly in the MoU, as covering any non-original physical goods manufactured without the consent of the right holder which infringe IPRs pursuant to applicable Member States or EU law.511 Therefore, its scope also embraces the sale of goods infringing copyright or related rights. In its Communication of 24 May 2011,512 the Commission announced its intention to continue its efforts, on the basis of this MoU, to explore to what extent, in particular, the sale of counterfeit goods over the internet can be reduced through voluntary measures, involving the stakeholders most concerned by this phenomenon (right holders, internet platforms, and consumers). Although the MoU of 4 May 2011 provides for an evaluation period of one year,513 the first evaluation report was finally released on 18 April 2013.514 It states that signatories of the MoU received thousands of N&A requests per year, based on all kinds of grounds. The internet platforms seldom rejected N&A requests and seldom needed to ask for additional information to process a notification. Right holders reported that, by and large, despite differences in processing speed of removal requests,515 the N&A procedure has been working well on the sites of the internet plaforms covered by the MoU. Figures show that the sale of counterfeits tends to shift to internet platforms not covered by the MoU with a less strict enforcement policy. In only one case were issues reported by signatories regarding the alleged lack of compliance of the information-sharing provisions of the MoU with applicable data protection laws. On the other hand, the report also shows that some signatories were concerned that, by taking proactive measures to prevent the sale of counterfeit goods under the

507

508 509

510 511 512

513 514 515

See Ch. McCreevy, Brussels Conference on Counterfeiting and Piracy, SPEECH/08/237, ). . Cf. . The repeat infringers’ policies of the various internet platforms generally envisage dissuasive action (such as a temporary account suspension) targeted against the seller (and not simply the relevant offer) after the second infringement. More severe dissuasive measures can be applied if a seller is found to be offering counterfeit goods again. However, although internet platforms are considered by right holders to be taking more vigorous action than before against repeat infringers, dissuasive action was only applied reluctantly and with due care. Internet platforms agreed, under the MoU, to disclose, upon request, the identity and contact details of alleged infringers. See MoU, para. 2. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions ‘A Single Market for Intellectual Property Rights. Boosting Creativity and Innovation to Provide Economic Growth, High Quality Jobs and First Class Products and Services in Europe’ (n 91 above). Cf. Art. 40 of the MoU. Report from the Commission to the European Parliament and the Council on the functioning of the Memorandum of Understanding on the Sale of Counterfeit Goods via the Internet, COM(2013) 209 final. Thus, some internet platforms have reported that it usually took them up to 24 hours to remove an online offer (also known as a ‘listing’), but occasionally up to 48 hours; for others, it took two to five hours. Others said contested listings were removed the same day or early the following day. Right holders have also reported a variation in processing speed by the same internet platform across different Member States.

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MoU, they could be held to have actual knowledge of the illegal activities that would put them outside the liability protection regime of the E-Commerce Directive.516 Nevertheless, the report concludes that the MoU should be prolonged and should be reviewed again after a further two years, and that its membership should be extended. An updated version of the MoU was signed in June 2016. A second evaluation report, published on 29 November 2017, provides an overview of how the MoU functioned between 21 June 2016 and 21 June 2017.517 It points out that the impact of N&A procedures is by nature limited and that these procedures should therefore be complemented by strong preventive measures, but shows that between December 2016 and June 2017, the number of listings removed as a result of proactive and preventive measures taken by internet platforms increased almost tenfold, to reach 97.4 per cent (the remaining 2.65 per cent of the listings were removed as a result of notices sent by right holders). However, some internet platforms have underlined that technical preventive solutions are not only very costly but could also result in identifying many offers that could not be seen as infringing IPRs. Others reported that approximately 5 per cent of the overall number of notifications sent by right holders are unjustified, unfounded or abusive. The majority of right holders surveyed, for their part, estimated that the percentage of cases in which reporting an offer of counterfeit goods led to its takedown was often close to 100 per cent. On the other hand, they stated that it is difficult for them to monitor the efficiency of proactive and preventive measures taken by the internet platforms as they do not receive appropriate feedback from them: if they could revise the measures in place for each platform, they would be able to evaluate the efficiency of the filters used and, where needed, improve them with their specific experience and knowledge. They also pointed out that sellers should be required to provide their name, address, ID number and bank account details when registering on the platforms, as this would prevent the creation of computer-generated seller accounts, and thus reduce the reappearance of counterfeit listings. All right holders also suggested that internet platforms give them more information on repeat infringers, including IP addresses, email addresses, phone numbers and bank details. Last but not least, all parties to the MoU agreed that the MoU’s impact was limited overall due to the low number of signatories, and that other participants of the e-commerce ecosystem, including social media, price-comparison websites and classified websites, should be involved in the MoU process. 21.198 The Stakeholders’ Dialogue on Illegal Up- and Downloading, which included representatives from the entertainment industries, ISPs, and telecommunication companies, proved to be less fruitful.518 It was launched in summer 2009 and mainly explored the impact of illegal file-sharing on the different industries and society at large, as well as the availability of easily accessible and attractive legal offers. This Dialogue aimed to progressively build a climate of confidence, facilitate dialogue and foster mutual understanding among the different types of stakeholders involved. It was terminated early in 2011, without resulting in any specific legislative proposal, nor, for that matter, in any non-legislative action of interest. Another MoU, signed between a number of parties from the internet advertising ecosystem, aims at withholding advertising on IP infringing websites. It appears from a report commissioned by EUIPO that adverts for goods associated with (mostly major) legitimate brands can often be found on infringing websites.519 Under this MoU, the signatories commit themselves to take a number of actions designed to reduce the flow of

516 517

518 519

See above, paras. 21.139 ff as regards the ‘safe harbour’ provisions of the E-Commerce Directive. Commission Staff Working Document ‘Overview of the functioning of the Memorandum of Understanding on the sale of counterfeit goods via the internet’, SDW(2017) 430 final (accompanying document to the Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee ‘A balanced IP enforcement system responding to today’s societal challenges’, n 97 above). A ‘Synthesis Report’ from this Stakeholders’ Dialogue is available at . See EUIPO, Digital advertising on suspected infringing websites (June 2016), .

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advertising revenue to infringing websites. Work is currently underway on an MoU for the transport and shipping industries, which aims to prevent the services of these companies from being used by commercial-scale counterfeiters to channel fake goods into the EU. A further MoU in preparation is expected to cover providers of payment services.520

VI. THE FIGHT AGAINST PIRACY IN THIRD COUNTRIES The EU has traditionally been very active in fostering the protection and enforcement of IPRs 21.199 outside the EU. Trade policy, including intellectual property aspects, is an exclusive EU competence. Not only has the EU, therefore, been involved in the framework of the international talks with the WTO, WIPO, WCO, and OECD, among others, in this area; it has also made sure that the main bilateral trade agreements concluded by the EU include a chapter on IPRs, and has engaged in political dialogues on a diplomatic level, as well as in diverse technical cooperation programmes. The Commission’s DG TRADE521 is in charge of those policies. It also represented the Commission during the negotiations of the ACTA. The Commission developed the first long-term ‘Strategy for the Enforcement of Intellectual 21.200 Property Rights in Third Countries’ in 2004,522 putting forward a number of ambitious legislative tools (such as multilateral and bilateral agreements) and non-legislative initiatives (such as intellectual property dialogues). The Strategy consists of 22 ‘specific actions’, structured in eight action lines such as political dialogue, technical cooperation, or institutional cooperation. In the framework of its policies towards third countries, the Commission also put together a list of ‘priority countries’, which is regularly updated.523 The Commission Communication on the new trade policy

520

521 522 523

See Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee ‘A balanced IP enforcement system responding to today’s societal challenges’, n 97 above, 2 and 8, and the annex hereto (Commission Staff Working Document ‘Overview of the Functioning of the Memorandum of Understanding on the sale of counterfeit goods via the internet’, n 517 above). . COM(2004) 749; [2005] OJ C129/3. See . The Commission stressed, in this regard, that: ‘“Priority countries” are not necessarily those where IPR protection and enforcement is the most problematic in absolute terms but rather those where such deficiencies are deemed to cause the greatest economic harm to EU interests’ (Corrigendum of 8 January 2020 to the Commission Staff Working Document ‘Report on the protection and enforcement of intellectual property rights in third countries’, SWD(2019) 452/2 final. In 2006, the Commission identified 14 priority countries on the basis of its IPR Enforcement Survey, i.e., China (priority 1), Thailand, Philippines, Turkey, Indonesia (priority 2), and Ukraine, Argentina, Vietnam, Korea, Brazil, Chile, Malaysia, Paraguay, and Russia (priority 3). This list was partially revised in 2009. It was updated again in the above-mentioned 2019 Report on the protection and enforcement of intellectual property rights in third countries. The updated list includes China (priority 1), India, Indonesia, Russia, Turkey and Ukraine (priority 2), and Argentina, Brazil, Ecuador, Malaysia, Nigeria, Saudi Arabia and Thailand (priority 3). According to the report, China remains the main challenge regarding IPR enforcement. A large number of all suspect goods detained at EU borders in recent years came from China (see para. 21.04 above). Regarding copyright, open issues include the introduction of a right of remuneration for performers and producers for public performances and broadcasting of phonograms published for commercial purposes, as well as the extension of the copyright term of protection. Serious systemic issues have been identified in the area of IP protection and enforcement in ‘Priority 2’ countries as well, causing considerable harm to EU businesses; compared to the previous report, these countries have made no progress or only limited progress in addressing these concerns. The Thai copyright law is considered not to be in line with technological developments, and actions against digital piracy have been insufficient. Digital piracy is widespread in Indonesia. Similar issues have been identified in the ‘Priority 3’ countries, but the gravity and the number of problems identified in those countries are lower than in ‘Priority 2’ countries. Saudi Arabia was selected ‘because of its global role as a regional transit country for counterfeit and pirated goods destined for the EU, and because stakeholders report high-scale satellite and online piracy and ineffective measures to tackle them’ (cf., inter alia, the (in)famous beoutQ saga, see and ). In August 2018, the EU took steps to request Saudi Arabia to take appropriate actions against satellite and online piracy of TV programmes belonging also to EU right holders. In the absence of any reaction or action, it made a third-party written submission in the case WTO DS/567: Saudi Arabia – Measures

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‘Trade, Growth and World Affairs’ of 9 November 2010524 outlines the Commission’s actions aimed at fostering IPR protection and enforcement outside the EU. The Commission revised its strategy in a more recent Communication525 in order to take account of the increasing significance of the digital era, the environmental challenge, and to ensure a fair balance between the protection of intellectual property, on the one hand, and access to innovation and welfare (in particular, regarding access to medicines), on the other. Since 2006, the European Commission has been publishing biennially a report on the protection and enforcement of IPRs in third countries. The main objective of those reports is to identity countries outside the EU in which the state of IPR protection and enforcement, both offline and online, gives rise to the greatest level of concern. They intend to help the Commission focus its efforts and resources on jurisdictions and on the specific areas of concern, with the aim of improving IPR protection and enforcement worldwide. They also aim to inform right holders about potential risks to their IPRs when engaging in business activities in certain third countries. The latest report was released on 20 December 2019.526 Next to singling out 13 ‘priority countries’ in which the most serious concerns have been identified in the area of intellectual property protection and enforcement, it dedicates a section to some of the countries with which the EU has already concluded or is about to conclude free trade agreements and where there is a particular need to monitor the IP situation, i.e., Canada, South Korea, Mexico, and Vietnam. 21.201 The EU’s continuous dialogue with third countries in the field of intellectual property has focused on the need to guarantee the effective recognition and proper registration of IPRs, as well as the implementation of efficient tools to ensure the proper enforcement of such rights. By way of example, the EU is very active in ‘exporting’ the injunctive relief against intermediaries enshrined in the IPRED and the InfoSoc Directive.527 21.202 On the other hand, the need to update the international legal framework in terms of IPR enforcement set up by TRIPS in order to take account of the new shape and challenges of the world economy is real. The ever-increasing role and significance of the digital environment, giving rise to cross-border infringements that are ever more complex and difficult to deal with, requires tailored

524

525 526 527

concerning the protection of intellectual property rights (). Copyright piracy, especially online and satellite piracy, is also widespread and rampant in Argentina, Brazil, China, Ecuador, India, Indonesia, Mexico, Russia, Thailand, Ukraine, and Vietnam. Problems with the functioning of the system of collective management of rights have been reported in Nigeria, Russia, Ukraine, and Thailand, causing losses for right holders and creating mistrust amongst users. EU stakeholders report that online piracy remains a significant problem in Nigeria. Saudi Arabia, Thailand and Vietnam have not yet acceded to the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty. In Argentina, stakeholders report that many universities still copy complete works of varying genres, around 70 per cent of software used is pirated and enforcement of copyright infringements is almost non-existent. Although the protection and enforcement of IPRs in the US is globally very effective, and the EU and the US have established in recent years a good cooperation on IP issues, the failure of the US to comply with the WTO dispute settlement decision in the Irish Music case is of concern. In this decision (WTO Dispute Settlement Body, United States – Section 110(5) of the US Copyright Act (‘United States – Section 110(5) ), WT/DS160/R), Section 110(5) of the US Copyright Act (under which most commercial premises in the US, such as bars, restaurants, etc., can retransmit broadcast music without paying any royalties to the copyright holders) was found to be incompatible with the TRIPS Agreement. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 9 November 2010 ‘Trade, Growth and World Affairs Trade. Policy as a core component of the EU’s 2020 strategy’, COM(2010) 612 final. Communication of 1 July 2014 from the Commission to the European Parliament, the Council and the Economic and Social Committee ‘Trade, growth and intellectual property’, n 95 above. Commission Staff Working Document ‘Report on the protection and enforcement of intellectual property rights in third countries’, SWD(2019) 452 final; corrigendum of 8 January 2020, SWD(2019) 452/2 final. See, inter alia, Art. 8 of ACTA (see para. 21.200 above) and Art. 234 of the Free Trade Agreement between EU, Colombia and Peru (see ).

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solutions. The TRIPS Agreement does not specifically address the issue of online IPR infringements. Its provisions are quite general, and weak overall.528 Disparate sets of rules have been adopted in the member countries of the WTO, which it would be worthwhile harmonising to an acceptable level. Back in 2004, the EU legislature acknowledged that ‘[i]ncreasing use of the Internet enables pirated products to be distributed instantly around the globe’.529 Six years later, in the framework of the analysis of the application of the IPRED, several Member States concluded, in their national reports addressed to the Commission, that ‘greater attention needs to be given to the infringements of intellectual property rights on the Internet and that the Directive does not sufficiently address this constantly growing, serious problem’.530 Not only due to the technical developments, but also due to commercial developments – such as the increasing importance of geographical indications and designs – adaptations to the international legal framework are required.531 In its Conclusions of 20 November 2008 on the European digital library EUROPEANA, the 21.203 European Council invited the Member States and the Commission to contribute actively to reinforcing compliance with, and the protection of, copyright and related rights at the international level, in the framework of the relevant bilateral and multilateral agreements and political dialogue and cooperation with countries outside the EU;532 18 months later, in its Resolution of 1 March 2010 on the enforcement of IPRs in the internal market, the Council invited the Member States and the Commission to promote appropriate and effective levels of intellectual property protection in both bilateral and multilateral international agreements ‘with due regard to the Union acquis ’.533 The Commission claimed that ACTA, by encouraging the EU’s trading partners to implement ‘TRIPS plus’ protection standards to tackle IPR infringements, would provide benefits for EU exporting right holders operating in the global market who suffer widespread infringements of their rights abroad.534 The European Parliament also acknowledged, in a Resolution of 24 November 2010,535 that ACTA, as a tool for making the existing standards more effective, would benefit EU exports and protect right holders operating in the global market. However, the Commission would soon be reminded that, due to diverging views between developed 21.204 and developing countries and the recurrent opposition of non-governmental organisations, it has become increasingly difficult to promote multilateral or plurilateral agreements aiming to strengthen the protection of IPRs at the international level.

528 529 530 531

532 533 534

535

P.K. Yu, ‘TRIPS and its Achilles’ Heel’ (2011) 18 J Intellectual Property Law 479. IPRED, Recital 9. Commission Staff Working Document on the application of the IPRED (n 151 above), 8. Lory and Hecˇko, n 169 above, para. 4.112. Since its adoption in 1994, the TRIPS Agreement was only amended once, following the 2005 Decision WT/L/641, so as to add Art. 31bis, as well as an Annex and an Appendix to the text of the Agreement in order to address public health needs of developing and least-developed WTO member countries by providing an additional legal pathway for the export of low-cost generic medicines under a compulsory licence tailored specifically for export. Council Conclusions of 20 November 2008 [2008] OJ C319/18. See para. 8. Council Resolution of 1 March 2010 (n 60 above), para. 43. Proposals for a Council Decision on the conclusion of the Anti-Counterfeiting Trade Agreement between the European Union and its Member States, Australia, Canada, Japan, the Republic of Korea, the United Mexican States, the Kingdom of Morocco, New Zealand, the Republic of Singapore, the Swiss Confederation and the United States of America, COM(2011) 379 final and COM(2011) 380 final; cf. Explanatory Memorandum, para 2. See also the speech delivered by Commissioner De Gucht on 29 February 2012, ‘ACTA – State of Play’, First Exchange of Views with the Committee for International Trade of the European Parliament, SPEECH/12/136 (available at ), 3: ‘[…] ACTA spreads our level of protection to a wider sphere. This sphere, it is to be hoped, will be the basis for further expansion as more countries join’. European Parliament Resolution of 24 November 2010 on the Anti-Counterfeiting Trade Agreement (ACTA), P7 TA(2010)0432.

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1. Legislative actions A. Multilateral and plurilateral agreements 21.205 Since the adoption of the TRIPS Agreement (1994) and the WIPO Internet Treaties (1996),536 multilateral efforts – and even plurilateral initiatives, for that matter – aiming to strengthen the international legal framework on IPR enforcement have been largely unsuccessful. As will be seen below, the only fruitful initiatives on the international scene in recent years have consisted in the conclusion of a number of bilateral trade agreements. i.

The European Free Trade Association (EFTA)

21.206 The European Free Trade Association (EFTA)537 is a free trade organisation between the EU, Liechtenstein, Iceland, Norway, and Switzerland. It was established on 3 May 1960. Three of the EFTA countries are part of the EU Internal Market through the Agreement on a European Economic Area (EEA), which took effect in 1994; the fourth, Switzerland, opted to conclude bilateral agreements with the EU. 21.207 The initial Stockholm Convention establishing the European Free Trade Association was superseded in 2001 by the Vaduz Convention, which entered into force one year later. It sets down as one of EFTA’s objectives ‘to provide appropriate protection of intellectual property rights, in accordance with the highest international standards’.538 Article 19 further states that ‘Member States shall grant and ensure adequate and effective protection of intellectual property rights, and provide for measures for the enforcement of such rights against infringement thereof, counterfeiting and piracy, in accordance with the provisions of this Article, Annex J and the international agreements referred to therein’. They also agreed: upon request of any Member State, to review the provisions on the protection of intellectual property rights contained in the present Article and in Annex J, with a view to further improve levels of protection and to avoid or remedy trade distortions caused by actual levels of protection of intellectual property rights.539

Annex J to the Convention provides that ‘intellectual property’ comprises in particular copyright, including computer programs and databases, as well as neighbouring (or related) rights, trademarks for goods and services, geographical indications, including appellations of origin, for goods and services, industrial designs, patents, plant varieties, topographies of integrated circuits, as well as undisclosed information. It also includes a number of provisions covering substantive intellectual property protection. Article 7 of Annex J, which deals with ‘Enforcement of intellectual property rights’, limits itself to stating that the Member States must provide for enforcement provisions under their national laws of the same level as that provided in the TRIPS Agreement, in particular Articles 41–61.

536

537 538

539

See above, paras 21.12–21.14, in this regard. For a detailed analysis of the multilateral and major plurilateral agreements dealing with intellectual property enforcement, see X. Seuba, The Global Regime for the Enforcement of Intellectual Property Rights, Cambridge University Press, 2017. . See Convention establishing the European Free Trade Association, last amended on 20 September 2010 (consolidated version), Art. 2(g). The text of the Convention is available at . Ibid., Art. 19(1) and (4).

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ii.

The Anti-Counterfeiting Trade Agreement (ACTA)

State of play in the EU The preliminary discussions about a new multilateral Anti-Counterfeiting Trade Agreement started 21.208 in 2006. They involved Canada, the European Commission, Japan, Switzerland, and the United States. The aim of the parties to the negotiations was to establish a new international legal framework for a 21.209 more effective enforcement of IPRs in both the physical and the digital environment. The objective was to agree on international standards extending beyond the minimum TRIPS standards. Encouraged by the Council540 and the Parliament, the Commission enthusiastically joined, in the 21.210 spring of 2008, in the formal negotiation process. The European Commission’s negotiating directives were adopted by the Council on 14 April 2008. The Commission committed that ACTA would not go beyond, and would be compliant with, the EU acquis, and would not affect the EU’s obligations with respect to the TRIPS Agreement. The negotiations were formally launched on 3 June 2008, and included the EU and its Member States, Australia, Canada, Japan, South Korea, Mexico, Morocco, New Zealand, Singapore, Switzerland, and the United States.541 Because it did not prove possible to open negotiations within the existing multinational fora, such as the WTO and WIPO, ACTA is a ‘stand-alone’ agreement independent of any existing international organisation. ACTA is often seen as an attempt to set the agenda among like-minded countries and to circumvent obstacles encountered in multilateral fora.542 The Commission led the negotiations on the general provisions of ACTA on behalf of the Union, 21.211 while the rotating EU Presidency led the negotiations on matters of criminal enforcement on behalf of the Member States.543 The conduct of an impact assessment of the implementation of ACTA was deemed unnecessary by 21.212 the Commission. According to Commissioner De Gucht,544 since the Commission was bound not to go beyond the EU acquis it had based its assessment of the impact of ACTA on the studies made for the IPRED and for the 2006 proposal for a Directive on criminal enforcement of IPRs (IPRED2).

540 541 542 543

544

Council Resolution of 25 September 2008 on a Comprehensive European Anti-Counterfeiting and Anti-Piracy Plan (n 42 above), para. 14. It should be noted that none of these countries are ‘priority countries’ as defined by the European Commission. See n 523 above. ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’, n 19 above, 9. P. Roffe and X. Seuba, The ACTA and the Plurilateral Enforcement Agenda: Genesis and Aftermath, Cambridge University Press, 2014. Since the entry into force of the Lisbon Treaty on 1 December 2009, either the EU or the Member States may legislate and adopt legally binding acts with regard to criminal measures (TFEU, Arts 83(1) and 83(2); see para. 21.93 above). As far as ACTA is concerned, the Commission opted not to propose that the EU exercise its potential competence in the area of penal enforcement. This position was justified by the fact that the Commission had never intended, as regards the negotiation of ACTA, to modify the EU acquis on IPR enforcement (Proposals for a Council Decision on the conclusion of the Anti-Counterfeiting Trade Agreement between the European Union and its Member States, Australia, Canada, Japan, the Republic of Korea, the United Mexican States, the Kingdom of Morocco, New Zealand, the Republic of Singapore, the Swiss Confederation and the United States of America, COM(2011) 379 final and COM(2011) 380 final. Cf. Explanatory Memorandum, para. 6). As has been mentioned above (see paras 21.88 ff), no such acquis exists in the field of penal enforcement of IPRs as of today, except as regards judicial and police cooperation. The negotiations of Chapter II, Section 4, of ACTA were therefore led by the rotating EU Presidency, based on positions agreed by the Council in COREPER. Answer given on behalf of the Commission on parliamentary questions on 27 September 2010.

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21.213 The governments participating in the ACTA negotiations engaged in ‘closed-door’ talks, which resulted in enormous speculation and suspicion on the parts of civil society and a few nonparticipating countries about the objective, scope, and content of the proposed Agreement.545 Although the Commission claims that the Member States were kept informed of the negotiations orally and in writing via the Council’s Trade Policy Committee and the European Parliament’s Committee on International Trade (INTA), as well as through Trade Commissioner Karel De Gucht on the occasion of three plenary debates in 2010 and of answers on a number of parliamentary questions,546 the lack of transparency has also been consistently singled out as one of the major flaws of the negotiation process of ACTA. On 10 March 2010, the European Parliament adopted a Resolution on the transparency and state of play of the ACTA negotiations,547 in which it called on the Commission and the Council ‘to engage proactively with ACTA negotiation partners to rule out any further negotiations which are confidential as a matter of course and to inform Parliament fully and in a timely manner about its initiatives in this regard’, and stressed that, ‘unless Parliament is immediately and fully informed at all stages of the negotiations, it reserves its right to take suitable action, including bringing a case before the Court of Justice in order to safeguard its prerogatives’. It recalled, in this respect, that, since the entry into force of the Lisbon Treaty on 1 December 2009, ‘the Commission has had a legal obligation to inform Parliament immediately and fully at all stages of international negotiations’. 21.214 In June 2010, China, supported by Brazil and India, argued that ACTA may be contrary to the TRIPS Agreement and the Doha Declaration on TRIPS and Public Health. Further concerns were raised by other developing countries at a TRIPS Council meeting in October 2010 and on 28–29 February 2012.548 On its part, the European Parliament adopted a Resolution supporting ACTA on 24 November 2010.549 The Resolution emphasises once more that ‘any agreement reached by the EU on ACTA must comply fully with the acquis communautaire ’ (point K), but also that ACTA will not change the EU acquis in terms of IPR enforcement (point 6). It also acknowledges that ‘after strong representations by Parliament, the level of transparency of the ACTA negotiations was fundamentally improved and, since the negotiating round in New Zealand, Parliament has been fully informed of the course of the negotiations’ (point F). 21.215 The negotiations were concluded on 15 November 2010. After 11 rounds of negotiations, the text was initialled on 25 November 2010. The final version of the proposed Agreement, dated 3 December 2010, was released on the European Commission’s DG Trade’s website.550 On 15 December 2012, the Council adopted a decision authorising the signing of ACTA on behalf of the EU Member States.551 21.216 Between 2010 and 2012, numerous questions were raised concerning the compatibility between the proposed Agreement and the EU acquis, including on matters of fundamental rights and civil

545 546

547 548 549 550

551

M.D. Taylor, ‘The global system of copyright enforcement: Regulations, policies and politics’, in I. Stamatoudi (ed.), Copyright Enforcement and the Internet, Wolters Kluwer, Law and Business Series, 82. Proposals for a Council Decision on the conclusion of the Anti-Counterfeiting Trade Agreement (n 534 above). Cf. Explanatory Memorandum. para 5. Cf. also the speech delivered by Commissioner De Gucht on 29 February 2012, ‘ACTA – State of Play’ (n 534 above), 5. P7_TA(2010)0058. See . P7_TA(2010)0432. See https://blog.ffii.org/new-version-of-the-acta-text/ and . The text of ACTA has in the meantime been removed from DG TRADE’s website but can be found here: . .

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liberties. The proposed Agreement has been much criticised by civil society in this regard.552 The alleged negative impact of ACTA on access to medicines was also singled out by several NGOs. As a political instrument, ACTA has undergone criticism for a number of reasons. First, the 21.217 non-binding (‘may’) clauses of ACTA have been regarded as signifying international incitement to implement these clauses into contracting parties’ law.553 Secondly, it was said that the real goal of the parties to ACTA was, in fact, to exert pressure on non-contracting countries to also adopt the new Agreement in the future, in hopes of receiving trade benefits from the other ACTA parties.554 Others have questioned the effectiveness of a plurilateral agreement which does not include the BRIC countries (Brazil, Russia, India, and China).555 Finally, on the EU level, a question was raised about the legitimacy of the EU Presidency negotiating the ACTA provisions on criminal measures.556 In February 2011, a group of academics issued an ‘Opinion of European Academics on Anti- 21.218 Counterfeiting Trade Agreement’.557 The analysis was based on the final text of ACTA. While recognising that ‘the most controversial enforcement measures proposed in the initial stages of the negotiations of ACTA have been narrowed down or abandoned in its final version’, the Opinion invited the European and national institutions to withhold consent to ACTA ‘as long as significant deviations from the EU acquis or serious concerns on fundamental rights, data protection, and a fair balance of interests are not properly addressed’. The Commission services replied to this Opinion in a Working Paper dated 27 April 2011.558 The Commission rebutted the findings of the European Academics and maintained that the proposed Agreement was fully in line with the EU acquis. On 15 June 2011, the results of a study commissioned by the European Parliament’s INTA 21.219 Committee (‘INTA Study’) were made public.559 The study is based on the final text of ACTA. The authors of the study opine that: the provisions of ACTA appear to rest, in most cases, within the boundaries of EU law. However, in some cases, ACTA is arguably more ambitious, providing for a degree of protection that appears to go beyond the limits established by EU law. The primary area of concern is that of border measures, especially the expansion of the scope of such measures to all other forms of intellectual property, except for patents. In short EU authorities will need to carefully review the very few instances in which there may need to be a modification of EU law.560

552 553 554 555 556 557 558

559 560

See, inter alia, La Quadrature du Net blog at . See the ‘Opinion of European Academics on Anti-Counterfeiting Trade Agreement’ of February 2011, . Ibid. See S. Ilias, The Proposed Anti-Counterfeiting Trade Agreement: Background and Key Issues, Congressional Research Service, Washington DC, 2010, 15. Cf. the Opinion of European Academics on ACTA, n 553 above. Ibid. Commission Services Working Paper ‘Comments on the “Opinion of European Academics on Anti-Counterfeiting Trade Agreement’”. See ‘European Commission: Comments on the “Opinion of European Academics on AntiCounterfeiting Trade Agreement”’, (2011) JIPITEC 171, . A. Kamperman Sanders, D.B. Shabalala, A. Moerland, M. Pugatch and P. Vergano, ‘The Anti-Counterfeiting Trade Agreement ACTA: An Assessment’ (June 2011); . INTA Study, 31. It is remarkable that, while ACTA has eventually been rejected by the European Parliament (see para. 21.227 below), the latter has in the meantime adopted a new Border Measures Regulation, which is now de facto in line with the border enforcement section of ACTA, in that it widens the scope of border measures to all forms of infringement with the exception of parallel imports of authentic goods (see paras 21.74–21.75 above).

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They conclude that unconditional consent to ACTA would be an inappropriate response from the European Parliament, but that unqualified rejection would probably also be inopportune.561 21.220 On 24 June 2011, the Commission referred to the Parliament and the Council two proposals for a Council decision on the conclusion of ACTA.562 21.221 On 8 October 2011, Professor Douwe Korff and Dr Ian Brown released an opinion dealing with the compatibility between ACTA and fundamental rights, prepared at the request of The Greens– European Free Alliance in the European Parliament.563 The authors conclude that ACTA fails to comply with several key provisions of the ECHR and the EU Charter of Fundamental Rights. 21.222 On its part, the Legal Service of the European Parliament provided two confidential Legal Opinions on ACTA, respectively on 5 October 2011 (SJ-0501/11) to the INTA Committee on International Trade (INTA)564 and on 8 December 2011 (SJ-0661/11) to the Committee on Legal Affairs (JURI).565 The Legal Service concluded that ACTA could be considered prima facie compatible with the EU Treaties, the general principles of EU law and the EU acquis, ‘in particular as regards Union acts in the area of intellectual property rights and their enforcement (including civil, criminal and border protection measures and measures relating to the digital environment)’. It also concluded that ACTA was in line with existing international obligations of the EU and its Member States, in particular with respect to the TRIPS Agreement and the Doha Declaration on TRIPS and Public Health. The second Legal Opinion also examines the conformity of ACTA with the legal framework concerning the protection of fundamental rights and civil liberties in the EU, including the ECHR and the Charter of Fundamental Rights. 21.223 The signing of ACTA by the governments of 22 EU Member States (i.e., all Member States with the exception of Estonia, Slovakia, Cyprus, the Netherlands and, remarkably, Germany – one of the Member States most involved in the negotiations)566 and by diplomats representing the European Commission in Tokyo, on 26 January 2012, resulted in the resignation, on the very same day, of French MEP Kader Arif as lead Rapporteur for ACTA for the European Parliament. The Czech Republic, Poland, Bulgaria, Romania, and Latvia did sign the treaty, but suspended the ratification process. None of the EU Member States has ratified ACTA so far. Following signatures by the Member States, ACTA still had to be submitted to the European Parliament for approval. 21.224 On 15 February 2012, the Vice-President of the European Commission and EU Commissioner for Justice, Fundamental Rights and Citizenship, Mrs. Viviane Reding, issued a statement, in which she welcomed the intention of several members of the European Parliament to ask the CJEU for a legal opinion to clarify that ACTA cannot limit freedom of expression and freedom of the internet.567 A week later, on 22 February, the Commission announced that ACTA would be referred to the CJEU for an opinion concerning the question whether the proposed Agreement was

561 562 563 564 565 566 567

INTA Study, 65 ff. See above, n 543. See . D(2011) 63060, 8 December 2011. See . D(2011) 47454, 5 October 2011. See . Croatia only acceded to the EU in July 2013. Statement by Viviane Reding, Vice-President of the European Commission and EU Commissioner for Justice, Fundamental Rights and Citizenship, on freedom of expression and information via the internet, attempts to block websites, ‘three-strikes-laws’, and ACTA, and .

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compatible with some fundamental rights and freedoms, such as the freedom of expression and freedom of information and the right to the protection of personal data.568 On 28 February 2012, a petition against ACTA, signed by 2.4 million internet users, was handed to 21.225 the Petitions Committee of the European Parliament.569 A few days later, on 15 March 2012, 119 stakeholders’ associations sent a letter to the Ministers of the EU Council, the EU’s Danish Presidency and the Council members, the Permanent Representations of all EU Member States and the Trade Ministers, Commissioner De Gucht’s Cabinet, and the concerned Services at the EU Commission, in support of ACTA.570 On 27 March 2012, the European Parliament’s INTA Committee voted against the referral of 21.226 ACTA to the CJEU and expressed the intention to subject the proposed Agreement to a vote in the next few months. ACTA was eventually rejected by the European Parliament by 478 votes to 39. In July 2012, the 21.227 Commission asked the CJEU to rule on ACTA’s compatibility with fundamental European freedoms with the hope that a favourable ruling would allow the European Parliament to reconsider it. However, in December 2012, MEPs from the Social and Democratic Alliance group gleefully announced that the request for a ruling to the CJEU had been withdrawn by Commissioner De Gucht.571 It is therefore unlikely that ACTA will ever be ratified by the EU. The referral of ACTA to the CJEU would have been a welcome move; it would presumably have helped support a calm, reasoned, open and democratic discussion on ACTA in the EU.572 Although ACTA was originally signed by Australia, Canada, Japan, Morocco, Mexico, New 21.228 Zealand, Singapore, South Korea, the USA as well as the EU and 22 EU Member States in January 2012, as of 1 April 2020 only Japan had ratified it. The Agreement will come into force in countries that ratified it after ratification by six countries – if ever.573 Nature and scope ACTA is an enforcement treaty. It aims – or should we say aimed ? – to introduce a new 21.229 international framework, building upon the TRIPS Agreement. TRIPS does not preclude the WTO Members from entering enter into plurilateral agreements which restrict the use of TRIPS safeguards that are optional.574 Like TRIPS, ACTA functions as a minimum standard agreement,575 setting up state-of-the-art provisions on IPR enforcement, including provisions on civil, criminal, and customs enforcement measures, cooperation mechanisms among signatory Parties to assist in their enforcement efforts, and the establishment of best practices for effective IPR enforcement.

568 569 570 571 572

573 574 575

See . See . See . ‘“End of Road” for ACTA in Europe as EC withdraws court appeal over treaty’ (21 December 2012), . A similar opinion was requested by Belgium regarding the Comprehensive Economic and Trade Agreement between Canada, of the one part, and the EU and its Member States, of the other part (CETA): see the Opinion 1/17 of Advocate General Bot of 29 January 2019, Request for an opinion by the Kingdom of Belgium. The Advocate General proposes that the CJEU should opine that Section F of Chapter 8 of CETA, establishing an investment dispute resolution mechanism between investors and States, is compatible with the Treaty on European Union, the Treaty on the Functioning of the European Union and the Charter of Fundamental Rights of the European Union. ACTA, Art. 40. TRIPS Agreement, Art. 1(1). ACTA, Art. 2(1).

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21.230 Although several provisions of ACTA extend beyond the minimum requirements laid down in the TRIPS Agreement, the ACTA Parties remain fully bound by TRIPS and subject to the Dispute Settlement Body of the WTO. On the other hand, ACTA’s provisions are binding only on its contracting parties. As the preamble expressly states, ACTA aims to ‘complement’ TRIPS. Thus, for example, ACTA has a chapter on IPR enforcement in the digital environment, which is not the case of TRIPS.576 The substantive provisions of ACTA contain several references to TRIPS.577 Article 1 provides that nothing in ACTA shall derogate from any obligation of a Party under existing agreements, including TRIPS. Only WTO Members may accede to ACTA.578 Moreover: the principle of harmonious interpretation and systemic integration, which acts as a general presumption against conflict in the interpretation of treaties, would seem to require that the TRIPS safeguards continue to bind the Parties insofar as there is no attempt to disclaim or remove those standards in the text.579

Thus, even though ACTA expressly allows its contracting parties to implement ACTA’s provisions as they wish,580 those parties will, of course, continue to be bound by the TRIPS Agreement, and will therefore have to implement ACTA in a way that is TRIPS-compliant. The repetition of existing rules and safeguards from the TRIPS Agreement was therefore unnecessary.581 In other words, the safeguards contained in TRIPS, to the extent that they are mandatory, are in no way modified by ACTA.582 21.231 ACTA is neutral on substantive protection of IPRs. The determination of what should be considered an IPR infringement and what should not be, is left to the domestic laws of the parties.583 If an ACTA party creates an exemption from IPR protection in certain regards, it will not have to apply the ACTA enforcement measures to those exempt areas; the parties who will have created such an exemption will be under no obligation to implement the civil, administrative or criminal provisions of ACTA in respect of the exempted activity. 21.232 Stakeholders such as European Digital Rights (EDRI) explicitly admit that ‘[m]any of the provisions […] in ACTA come from the Intellectual Property Enforcement Directive (IPRED)’.584 However, ACTA is written in more general terms than the IPRED and contains exceptions and procedural safeguards that are overall less precise and less specific. 21.233 Despite what its title suggests, ACTA does not only deal with trademark infringements of physical goods. In fact, pursuant to Article 5(h), ACTA covers the same IPRs as the IPRED, with the exception of sui generis rights of database makers, utility models, and plant variety rights. Besides, ACTA also includes protection of undisclosed information. However, Article 3(2) of ACTA provides that ‘nothing in this Agreement creates an obligation on a Party to apply measures where an intellectual property right is not protected under its laws and regulations’. Hence, ACTA does not go beyond the IPRED in terms of the IPRs which require protection.

576 577 578 579 580 581 582 583 584

There is no definition of ‘digital environment’ in ACTA. The concept presumably encompasses all forms of electronic information transmission. ACTA, Arts 1, 2(3), 8(2), and 13, in addition to Art. 5 (when defining ‘intellectual property’). Ibid, Art. 43. K. Weatherall, ‘Politics, compromise, text and the failures of the Anti-Counterfeiting Trade Agreement ’ (2011) Sydney Law Review, 33(2) 229, 259–60 (). ACTA, Art. 2(1). Admittedly, however, ACTA may seem inconsistent in this regard, insofar as, in several respects, it does restate enforcement obligations in TRIPS. Cf. Weatherall, 2011 (n 579 above), 260. Cf. K. Weatherall, ‘ACTA April 2010 – Analysis of provisions’, in The Selected Works of Kimberlee Weatherall, 2010, 36 (). ACTA, Art. 3(1). .

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As a general rule, the ACTA provisions are to be implemented in respect of all types of 21.234 infringement of the IPRs covered by the Agreement. However, some provisions only relate to ‘counterfeit trademark goods’ and ‘pirated copyright goods’, which are narrowly defined in Article 5(d) and (k). Like the IPRED, the civil enforcement section of ACTA contains provisions on right of 21.235 information,585 injunctions,586 damages,587 and corrective measures.588 In addition, the Agreement also contains provisions on TPMs and DRMs,589 border measures,590 criminal sanctions,591 and international cooperation and cross-border data exchanges.592 The civil enforcement section aims to allow the courts or other competent bodies authority to take 21.236 specific actions once it is established that an IPR has been infringed. As regards the border measures section, it deals with the actions that Customs would be entitled to 21.237 take to prevent goods infringing IPRs from crossing borders. Article 13 of ACTA encourages the parties to provide for effective border enforcement of IPRs, ‘as appropriate’ and ‘in a manner that does not discriminate unjustifiably’ between IPRs. This concretely means that the parties would presumably not be allowed to reduce the scope of application of border measures in the fields of trademark and copyright and related rights only to ‘counterfeit goods’ and to ‘pirated goods’ as defined, for example, in the TRIPS Agreement593 or in EU Regulation 1383/2003.594 Footnote 5 of

585 586

587 588 589

ACTA, Arts 11 (general obligation) and 27(4) (‘may’ provision specifically relating to the digital environment). Ibid., Arts 8(1), 12, and 27(1). Art. 8(1) stipulates that each party must provide that its judicial authorities have the authority to issue an injunction against ‘any third party over whom the relevant judicial authority exercises jurisdiction’ to prevent goods that infringe an IPR from entering into the channels of commerce. Art. 12 of ACTA contains provisional measures inaudita altera parte. Art. 27(1) provides that the parties must ensure that enforcement procedures, to the extent set forth in, inter alia, Arts 8 and 12 of the Agreement, are available under their laws so as to permit effective action against IPR infringements which take place in the digital environment, ‘including expeditious remedies to prevent infringement and remedies which constitute a deterrent to further infringements’. Art. 9 of ACTA provides for the possibility for the courts to award damages in IPR infringement cases. This provision only applies to knowing infringements and infringements due to negligence. Ibid., Art. 10. Ibid., Art. 27(5)–(7). Footnote 14 of ACTA provides that Art. 27(5)–(7) is ‘[w]ithout prejudice to the scope of copyright or related rights contained in a Party’s law’, while Art. 27(8) expressly stipulates that the obligations set forth in paras (5)–(7) are without prejudice to the rights, limitations, exceptions, or defences to copyright or related rights infringement under a party’s law. The ACTA parties will therefore have the right to maintain such limitations or exceptions to rights and to adopt new ones. Such an explicit reference to these ‘limitations, exceptions and defences’, which was in fact superfluous having regard to Art. 3(1) of ACTA (see para. 21.231 above), was deemed appropriate in the digital chapter of ACTA, an area where the Parties have different national legislations with no common basis. This is in contrast with the other chapters of ACTA, where the domestic laws of all the Parties had as a common denominator the minimum standards of TRIPS (not all the ACTA Parties have ratified the WIPO Internet Treaties and they have widely different systems of exceptions and limitations) (Commission Services Working Paper ‘Comments on the “Opinion of European Academics on Anti-Counterfeiting Trade Agreement).

590

591 592 593 594

Ibid., Arts 13–22. Art. 13 of ACTA encourages the parties to provide for effective border enforcement of IPRs, ‘as appropriate’ and ‘in a manner that does not discriminate unjustifiably between IPRs and that avoids the creation of barriers to legitimate trade’. According to some authors, Art. 13 is not mandatory, given the use of ‘should’ rather than the mandatory ‘shall’ or ‘must’ (Weatherall, 2011, 247). This would mean that ACTA leaves the scope of border measures entirely in the hands of individual countries (K. Weatherall, ‘Intellectual property in ACTA and the TPP: lessons not learned’, ). In my opinion, however, ACTA does require from the parties that they provide for effective border enforcement of IPRs, even though the parties remain free to do so in the way they deem appropriate. ACTA, Ch II, Section 4. Ibid., Arts 11 and 28–34. See note 14 under Art. 51 of the TRIPS Agreement. See Regulation 1383/2003, Art. 2(1)(a) and (b). See also n 216 above.

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ACTA, provides, however, that the parties may exclude parallel imports of authentic goods from the scope of the border measure provisions. 21.238 In our opinion, the concerns which have been raised regarding the possible consequences of the border measures regime set out in Article 13 of ACTA, which would allegedly be likely to impede free access to medicines, and therefore to violate the parties’ obligations under the Doha Declaration on TRIPS and Public Health,595 lack merit. Not only does Article 1 of ACTA provide that nothing in ACTA shall derogate from any obligation of a party under existing agreements, including the TRIPS Agreement – which, in turn, includes the Doha Declaration. Article 13 of ACTA too expressly stresses that the ACTA provisions on border measures are ‘without prejudice to the requirements of the TRIPS Agreement’. ACTA also takes on board the objectives and principles of Articles 7 and 8 of TRIPS,596 which also refer to the safeguarding of public health. Last but not least, the preamble of ACTA expressly provides that ACTA recognises the principles set forth in the Doha Declaration. Though non-binding per se, the preamble is important when interpreting the main body of the Agreement.597 21.239 In fact, since ACTA does not require the Parties to provide for border measures598 or criminal measures599 with respect to goods infringing patents or undisclosed information, it does not represent a danger for the international trade of generic medicines. The ACTA Parties may even exclude patents from the civil enforcement sections of the Agreement.600 21.240 The most sensitive section of ACTA with regard to fundamental rights probably concerns the criminal enforcement of IPRs. The criminal enforcement section of the Agreement covers the implementation of criminal procedures and penalties. As regards the first aspect, ACTA actually (only) mandates the parties to provide for criminal measures as regards wilful trademark counterfeiting of identical or indistinguishably similar signs and copyright piracy on a commercial scale.601 The definition of counterfeit trademark goods and pirated copyright goods is identical to the definition provided in footnote 14 to the TRIPS Agreement. Moreover, Article 61 of TRIPS also refers to the criteria of ‘wilful intent’ and ‘commercial-scale infringement’. 21.241 For the purpose of Article 23, ‘commercial scale’ is defined as including at least acts ‘carried out as commercial activities for direct or indirect economic or commercial advantage’. According to some

595 596

‘Opinion of European Academics on Anti-Counterfeiting Trade Agreement’ (n 553 above); INTA Study (n 559 above). ACTA, Art. 2(3). TRIPS, Art. 7, provides that: [t]he protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations (emphasis added). Art. 8(1) further states that: Members may, in formulating or amending their laws and regulations, adopt measures necessary to protect public health and nutrition, and to promote the public interest in sectors of vital importance to their socio-economic and technological development, provided that such measures are consistent with the provisions of this Agreement.

597

598 599 600 601

Finally, Art. 8(2) stresses that: ‘appropriate measures, provided that they are consistent with the provisions of this Agreement, may be needed to prevent the abuse of intellectual property rights by right holders or the resort to practices which unreasonably restrain trade or adversely affect the international transfer of technology’ (emphasis added). Vienna Convention on the Law of Treaties 1969, Art. 31(1) and (2). It should be noted that the US negotiated ACTA as an executive agreement, meaning that the Agreement would not be legally enforceable by itself in the US and would therefore not be subject to the Vienna Convention. However, the other parties to the Agreement disagree. ACTA, footnote 6. Ibid., Art. 23. Ibid., footnote 2. Ibid., Art. 23(1).

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commentators, this definition is presumably not compatible with the definition adopted by the WTO Dispute Settlement Panel in the US v. China case.602 However, it is not because ACTA would possibly go beyond TRIPS on the definition of criminal offences that it would per se be incompatible with the latter. After all, TRIPS only aims to set minimum standards for the protection of IPRs. WTO Members are therefore free to opt for a definition of commercial-scale infringements which would, as the case may be, extend beyond the definition provided for in TRIPS. Article 23(3) of ACTA provides that the parties may implement criminal measures for the 21.242 unauthorised copying of cinematographic works (camcording). Under Article 23(4) of ACTA, the parties are also free to determine under what conditions ‘aiding’ or ‘abetting’ should be subject to criminal liability. Finally, pursuant to Article 26, the parties must provide that their competent authorities may act upon their own initiative to initiate investigation or legal action with respect to the criminal offences specified in the Agreement. Some commentators have stated that ACTA encourages the parties to implement Article 23 21.243 without including ‘fair use’ or ‘fair comment’ exceptions to the substance of IPRs. This, in my opinion, is not correct. As Article 3 of ACTA expressly provides, ACTA is neutral on substantive protection of IPRs and only addresses enforcement matters. If an ACTA party creates an exemption from IPR protection in certain regards, it will not have to apply the enforcement measures (including the penal provisions) of the Agreement to those exempt areas.603 Concerns have, especially, been expressed regarding the ‘digital chapter ’ of ACTA. In its Resolution 21.244 of 10 March 2010 on the transparency and state of play of the ACTA negotiations,604 the Parliament stressed that: the proposed agreement should not make it possible for any so-called ‘three-strikes’ procedures to be imposed, in full accordance with Parliament’s decision on Article 1.1b in the (amending) Directive 2009/140/EC calling for the insertion of a new paragraph 3(a) in Article 1 of Directive 2002/21/EC on the matter of the ‘three strikes’ policy.605

In fact, the final version of ACTA does not require its signatories to provide for judicial or extra-judicial ‘three-strikes’ (or ‘graduated response’) mechanisms. It does not contain any provision mandating the public authorities of the parties to the Agreement to require ISPs to terminate users’ internet connections. Nor does the Agreement mandate the monitoring of the internet by ISPs. A ‘three-strike’ provision, which was initially considered during the negotiations of ACTA and might have encroached upon fundamental rights, has been deleted from the final version of the Agreement. While extended liability rules for ISPs were also considered at some point during the negotiations 21.245 on the Agreement, there are no provisions on ISP liability in the final version of ACTA – other than for direct infringement. Footnote 13 of ACTA expressly allows the Parties to limit liabilities on ISPs – as is currently the case in the E-Commerce Directive,606 for example. Much ink has been spilled about Article 27(3) of ACTA, which introduces a commitment from the 21.246 parties to encourage cooperation within the business community and, basically, promotes the conclusion of Memoranda of Understanding between stakeholders in order to strengthen IPR

602

603 604 605 606

China – Measures Affecting the Protection and Enforcement of Intellectual Property Rights (China – IPRs), WT/DS362/R, 09/0240, 26/01/2009. See ‘Opinion of European Academics on Anti-Counterfeiting Trade Agreement’ (n 553 above); INTA Study (n 559 above). See above, para. 21.231, in this regard. See n 547 above. See above, para. 21.153, in this regard. See paras 21.139 ff above.

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enforcement in the digital environment. Some stakeholders have claimed that ‘[s]uch cooperation is intended to be extensive, including the disconnection of end-users on the basis of decisions taken by private industry’.607 These allegations rely on a leaked document dated March 2010 released by the European Parliament, stating: ‘An example of such a policy is providing for the termination in appropriate circumstances of subscriptions and accounts in the service provider’s system or network of repeat infringers.’608 However, the footnote referred to in this quote has disappeared in the final version of the Agreement, which suggests that at least one of the parties disagreed with it. The opinion according to which the agreements referred to in Article 27(3) of ACTA ‘can almost only relate to the supposedly-dropped “three-strike proposals”’609 is not substantiated and is, in my view, speculative. Other voluntary arrangements can also be envisaged, such as agreements aimed at specifying the modalities of ‘notice-and-take-down’ mechanisms.610 Thus, the cooperation form contemplated by Article 27(3) may, for example, cover agreements or policies inviting ISPs to remove or disable access to infringing content or activity, upon receipt of a grounded notice of infringement and in the absence of a response to a formal notice from the relevant subscriber. The cutting-off of users from the internet is not the inevitable result of the voluntary cooperation promoted by Article 27(3).611 21.247 Pursuant to Article 27(4) of ACTA: [a] Party may provide, in accordance with its laws and regulations, its competent authorities with the authority to order an online service provider to disclose expeditiously to a right holder information sufficient to identify a subscriber whose account was allegedly used for infringement, where that right holder has filed a legally sufficient claim of trademark or copyright or related rights infringement, and where such information is being sought for the purpose of protecting or enforcing those rights. These procedures shall be implemented in a manner that avoids the creation of barriers to legitimate activity, including electronic commerce, and, consistent with that Party’s law, preserves fundamental principles such as freedom of expression, fair process, and privacy.

Article 5(c) of ACTA provides that ‘competent authority’ includes ‘the appropriate judicial, administrative, or law enforcement authorities under a Party’s law’ (emphasis added). To that extent, Article 27(4) of ACTA clearly exceeds the scope of Article 8 of the IPRED.612 In an opinion on ACTA issued on 24 April 2012, the EDPS recalled in this regard that ‘[t]he involvement of judicial authorities is an essential part of the current EU system and crucial to ensure that enforcement takes place in respect of due process and fundamental rights’.613 The disclosure by ISPs to right holders, under Article 8 of the IPRED, of personal data allowing the identification of a suspected subscriber

607 608 609 610 611

612 613

See, e.g., , . Cf. , footnote 6, 4. D. Korff and I. Brown, ‘Opinion on the compatibility of the Anti-Counterfeiting Trade Agreement (ACTA) with the European Convention on Human Rights & the EU Charter of Fundamental Rights’ (n 563 above), 27. See, e.g., the Memorandum of Understanding of 4 May 2011 on the Sale of Counterfeit Goods over the Internet (para. 21.197 above). See O. Vrins, ‘The impact of ACTA on the EU acquis and civil liberties’, in European Parliament, Directorate-General for external policies of the Union, The Anti-Counterfeiting Trade Agreement (ACTA), March 12, n° 66 (). See para. 21.48 above. Opinion of the European Data Protection Supervisor on the proposal for a Council Decision on the Conclusion of the Anti-Counterfeiting Trade Agreement between the European Union and its Member States, Australia, Canada, Japan, the Republic of Korea, the United Mexican States, the Kingdom of Morocco, New Zealand, the Republic of Singapore, the Swiss Confederation and the United States of America, n 138 above, para. 46. In its opinion, the EDPS is clearly reluctant to give administrative bodies the right to order the disclosure of information since such bodies are not ‘subject to all the guarantees of independence, impartiality and respect of the rights to the presumption of innocence and to a fair trial imposed upon judicial bodies’ (ibid., para. 47).

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for purpose of enforcement of IPRs, must be done under the control of a judicial authority.614 It should be noted, however, that Article 27(4) of ACTA is a ‘may’ provision, whose implementation into EU law would, therefore, have been optional. As Weatherall correctly puts it, the final version of ACTA ‘almost completely abandoned any 21.248 attempt to dictate the way that IPR enforcement will occur in the digital environment, or the ways that intermediaries in that environment will be regulated’,615 both ‘through the removal of detailed provisions on online service provider liability and the removal of language in the injunction provisions that might have required injunctions to be available against non-infringing intermediaries in the digital environment’.616 The international cooperation section of ACTA addresses issues such as capacity building and 21.249 technical assistance for developing countries, and also deals with the exchange of best practices and statistics on intellectual property enforcement efforts. Finally, ACTA contains an institutional framework section, setting up an ‘ACTA Secretariat’. The 21.250 responsibilities that will be assumed by the Secretariat remain unclear. While it will be called upon to interpret the provisions of the Agreement, it is uncertain, for example, whether or not it will also play the role of a dispute settlement body. As Professor Daniel Gervais rightly opines, ‘very few if any changes to EU law would have been 21.251 required for the EU to comply with ACTA.’617 ‘A number of small differences can be found but it is not clear that they amount to a departure from the acquis ’.618 By and large, the ACTA standards are not as extensive as the standards that the EU has been pushing in its latest bilateral FTAs.619 ACTA, like any other international agreement, is a compromise between different legal systems. The wording of several provisions of ACTA is obscure; several concepts and provisions are subject to interpretation. However, this is also the case for the TRIPS Agreement and, as a matter of fact, the EU acquis itself. The relative opacity of a number of provisions of ACTA is responsible for the speculations which 21.252 have surrounded the negotiations, and still surround the final text now. It has resulted in contradictory stances regarding the ‘impact’ which the Agreement could have had on existing EU legislation and civil liberties – with some authors claiming that ACTA actually fails to provide ‘state of the art’ intellectual property enforcement standards at all, with which parties may be expected to

614

615 616 617 618

619

See above, para. 21.48. Similarly, in France, the Constitutional Court held, on 10 June 2009 (Décision n° 2009-580 DC), that restrictions to internet access affect the freedom of expression and, therefore, could only be ordered by the courts, following a fair trial and subject to a proportionality test. The Court concluded that a French law which gave administrative bodies the right to restrict access to the internet for defendants infringing copyright and related rights, without the case having been heard by a judicial court, was unconstitutional. However, the Constitutional Court also held that the French courts could order temporary bans on internet access in the framework of inter partes judicial proceedings, and that provisional measures or interim injunctions could be ordered in summary proceedings as long as they were strictly necessary to protect the rights at issue. K. Weatherall, ‘Intellectual property in ACTA and the TPP: lessons not learned’, n 590 above, 8. Ibid., footnote 29. D. Gervais, ‘The international legal framework of border measures in the fight against counterfeiting and piracy’, in Vrins and Schneider, 2012, n 10 above, para. 3.87. Ibid., footnote 155. Even though ACTA appears to be in line with the EU acquis, it would still have had some impact on it, had it been adopted by the EU. Most stakeholders and commentators recognise that many provisions of ACTA come from the IPRED. Had ACTA been endorsed by the EU, the latter would have been under an international legal obligation not to change these provisions in the Directive in a way which would have run against the mandatory provisions of ACTA. Furthermore, ACTA might have had an impact on the direction of the EU debate on the future of IPR enforcement. For example, the criminal section of ACTA would have set a new floor for the discussion between Member States. Cf. INTA Study, n 559 above, 9. On FTAs, see further below, paras 21.253 ff. INTA Study, n 559 above, 16.

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comply,620 and others maintaining that the Agreement goes beyond the EU acquis and seriously jeopardises fundamental rights. I should, nevertheless, concede to Kimberlee Weatherall621 that ‘[w]ith the ordinary meaning of the text unclear, a general preamble that offers little specific guidance as to the intended scope of ACTA, and no travaux preparatoires to offer clues, the usual means for treaty interpretation offer little help’.

B. Bilateral agreements i.

The EU approach to FTAs

21.253 The failure of the ‘traditional’ international fora such as the WTO to open negotiations aimed at reviewing the TRIPS Agreement, as well as the fiasco of ACTA on the EU political scene, have prompted the Commission to rely primarily on bilateral agreements over the last few years to strengthen IPR protection and enforcement in third countries. The Commission has intensified its efforts in this area since 2006. Thus, in its Communication ‘Global Europe – Competing in the World’,622 it stated that: [t]he EU should seek to strengthen IPR provisions in future bilateral agreements and the enforcement of existing commitments in order to reduce IPR violations and the production and export of fake goods. The Commission will reinforce its enforcement activity and cooperation with a number of priority countries in particular China, Russia, ASEAN, Korea, Mercosur, Chile and Ukraine; and we will work to improve enforcement in Turkey in the context of accession negotiations. This will include reinforcing customs cooperation, creating and strengthening IPR dialogues, reinforcing our presence on the ground, allocating more resources to support right-holders, in particular SMEs, and building awareness of IPR issues among EU companies, particularly those operating in China.

21.254 The bilateral agreements concluded by the EU are mainly Free Trade Agreements (FTAs), Economic Partnership Agreements (EPAs),623 and Partnership and Cooperation Agreements (PCAs).624 The vast majority of these contain a chapter on the protection of intellectual, industrial and commercial property. The EU signed EPAs with the African, Caribbean, and Pacific (ACP) groups of countries.625 It has concluded PCAs with Russia, countries of Eastern Europe, the Southern Caucasus and Central Asia.626 It signed FTAs with a large number of countries, including Norway, Switzerland, eight Mediterranean countries, Canada, Mexico, Colombia, Ecuador and Peru, Central America, Chile, South Korea, Turkey, and five Western Balkan countries. Deep and Comprehensive Free-Trade Agreements (DCFTA) have also been signed by Georgia, Moldova, and Ukraine. The EU has also concluded or is about to conclude agreements including IPR chapters with Japan, Singapore, and Vietnam, and is about to finalise the negotiations with Kyrgyzstan. Negotiations are ongoing with Australia, Azerbaijan, Chile, Indonesia, New Zealand, Tunisia, and Uzbekistan.627 The negotiations in view of the conclusion of a far-reaching Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US were launched in 2013 and ended

620 621 622

623 624 625 626 627

See, inter alia, Weatherall, 2011, n 579 above. Ibid., 254. Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and the Committee of the Regions of 4 October 2006 ‘Global Europe: Competing in the World. A Contribution to the EU’s Growth and Jobs Strategy’, COM(2006) 567 final , see 11. For more information on EU EPAs, see . For more information on EU PCAs, see . The most important one is the EU-CARIFORUM agreement ([2008] OJ L289/1). . ‘Report on the protection and enforcement of intellectual property rights in third countries’, n 526 above, 13. For an overview of the FTA and other trade negotiations, see .

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without conclusion at the end of 2016.628 Most of the bilateral and regional trade agreements negotiated by the EU integrate comprehensive chapters on IPR protection and enforcement. Those with countries in the Eastern Partnership (such as Georgia, Moldova or Ukraine, for example) achieved significant regulatory approximation with the EU acquis and enforcement practices.629 Others (with Canada, South Korea, and Singapore, for instance) contain substantial improvements on TRIPS. Some other agreements with least-developed countries and poorer developing countries contain a more limited set of IPR provisions.630 Dispute settlement mechanisms similar to those that are available under the WTO Agreement are also built into most of the bilateral trade agreements concluded by the EU. The EU approach has traditionally relied on expecting from its partners that they adhere to treaties 21.255 requiring the highest international standards of intellectual property protection, including the WIPO Internet Treaties.631 In its 2006 ‘Global Europe’ Communication,632 however, the Commission emphasised that ‘FTAs should include stronger provisions for IPR and competition, including for example provisions on enforcement of IP rights along the lines of the EC Enforcement Directive.’ Many provisions of the IPRED go beyond the TRIPS requirements. Thus, unsurprisingly, FTAs concluded by the EU from 2006 onwards generally include a model intellectual property chapter which seeks to clarify and complement TRIPS, inter alia to address new challenges, most notably the need to protect IPR in the digital environment.633 The ‘Strategy for the Enforcement of Intellectual Property Rights in Third Countries’634 and the ‘2019 Report on the Protection and Enforcement of Intellectual Property Rights in Third Countries’635 underscore the achievement of ‘TRIPS-plus’ standards, especially on issues of IPR enforcement, as a major goal of the EU in negotiating FTAs. This new trend is reflected in the FTA which was signed on 6 October 2010 with South Korea, which entered into force in July 2011.636 The EU-Korea FTA is the first completed agreement in a new generation of FTAs launched by the EU in 2007. It is also the EU’s first trade deal with an Asian country. The agreements concluded with Colombia, Ecuador and Peru, Central America, and Canada (CETA) fall within this new generation of FTAs. The EU is increasingly being accused of attempting to impose unbalanced IPR provisions in 21.256 bilateral agreements with its trade partners.637 Such criticisms have induced the Commission to publish a fact sheet on ‘Protection of Intellectual Property in Free Trade Agreements’,638 in which it highlights the benefits of such agreements for EU citizens and companies and emphasises that the

628 629 630 631

632 633

634 635 636 637

638

A Council decision of 15 April 2019 states that the negotiating directives for the TTIP have become obsolete and are no longer relevant. See , Art. 3. ‘Report on the protection and enforcement of intellectual property rights in third countries’, n 526 above, 13. ‘Trade, growth and intellectual property – Strategy for the protection and enforcement of intellectual property rights in third countries’, n 95 above, 15. In recent bilateral and regional free trade agreements too, the parties agreed to comply with the WCT and the WPPT (see, e.g., Art. 143(1) of the EU-CARIFORUM EPA) or specific provisions thereof (see, e.g., Art. 10(5)(c) and (d) of the EU-Korea FTA [2011] OJ L90/46), requiring parties to comply with Arts 1–14 of the WCT and Arts 1–23 of the WPPT. See n 622 above, at 13. ‘Report on the protection and enforcement of intellectual property rights in third countries’, n 526 above, 13. An analysis of 158 trade agreements conducted in 2007 showed that over 50% of the agreements included ‘TRIPS-plus’ provisions: see UNCTAD, Intellectual Property Provisions in International Investment Arrangements (New York: United Nations, 2007), 5. See n 59 above. Report on the protection and enforcement of intellectual property rights in third countries’, n 526 above. . See T. Jaeger, ‘IP enforcement provisions in EU economic partnership agreements’ in: J. Drexl, H. Grosse Ruse-Khan and S. Nadde-Phlix (eds), EU Bilateral Trade Agreements: For Better or Worse?, MPI Studies on Intellectual Property and Competition Law, Vol. 20, Springer, 2014. .

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intellectual property chapters included in such FTAs, in particular in the field of copyright, are respectful of the rights to freedom of speech and freedom of information, and do not undermine access to medicines. While such FTAs do seek to set ‘TRIPS-plus’ protection standards, they are not per se inconsistent with TRIPS insofar as they exploit the flexibilities of TRIPS,639 and they include an explicit reference to the Doha Declaration on the TRIPS Agreement and Public Health. In addition, even though some FTAs do indeed include provisions extending the scope of protection of IPRs in third countries, some of them also contain dispositions on bio-diversity, technology transfers and traditional knowledge, coupled with technical assistance and cooperation programmes in this regard, which are, in fact, of primary interest to developing countries. Overall, however, a study commissioned by the European Parliament concludes that a better balance should be struck between the flexibilities in the TRIPS Agreement and the need for additional provisions in bilateral agreements to combat counterfeiting and piracy.640 21.257 The rejection of ACTA by the European Parliament prompted the Commission to intensify its negotiations with Canada for a free trade and copyright agreement baptised the ‘Comprehensive Economic and Trade Agreement’ or ‘CETA’. In 2018, Canada was the EU’s 11th most important trading partner, whereas the EU was Canada’s second-largest trading partner, after the US, accounting for 10 per cent of its trade in goods with the world.641 The negotiations started on 6 May 2009. An agreement in principle was signed on 18 October 2013 and entered into force provisionally on 21 September 2017. In addition to provisions which required Canada to change its intellectual property law (notably as regards the term of copyright protection, the implementation of distribution rights and resale rights for copyright owners, and a ban on the sale and distribution of circumvention devices), Canada also agreed to ratify the WCT and the WPPT. Canada was also mandated to implement new enforcement provisions including border measures, measures to preserve evidence, a right to information, injunctive relief, and corrective measures such as the destruction of counterfeit and pirated goods.642 It has been widely reported that many of the copyright provisions in CETA are identical to those in ACTA. The Commission refuted this allegation in August 2012, by stressing that the ACTA provisions on the liability of ISPs643 were not part of the final negotiations and that the legally binding provisions on criminal sanctions had

639

640

641 642

643

Cf. TRIPS, Art. 1, which provides that: ‘Members may, but shall not be obliged to, implement in their law more extensive protection than is required by this Agreement, provided that such protection does not contravene the provisions of this Agreement’. D. Matthews, ‘The fight against counterfeiting and piracy in the bilateral trade agreements of the EU’, briefing paper requested by the European Parliament’s Committee on International Trade, 2008, . Free trade agreements concluded by the EU need to be endorsed by the Member States through the Council, as well as the European Parliament (TFEU, Art. 218(6)). The recent rejection of the Anti-Counterfeiting Trade Agreement by the Parliament (see para. 21.227 above) did not prevent it from giving its ‘fiat’ to FTAs whose provisions are to a large extent similar to those in ACTA. The value of bilateral trade in goods between the EU and Canada was €72.3 billion in 2018 (). A number of positive developments have been noted recently in Canada in the copyright field, such as a reform bringing its legislation better in line with the WIPO Internet Treaties. Canada has also reportedly shown political will to address certain IPR issues, e.g., with its domestic copyright reform. However, problems subsist. Thus, for example, the new Canadian copyright law includes broad exceptions which are potentially detrimental to right holders. EU stakeholders are particularly concerned about the fair dealing exception for educational purposes and the exception for noncommercial user-generated content. The fact that Canada does not grant a remuneration right to phonogram producers and performers for a number of uses of their music in broadcasting and public performance, as well as online piracy, have also been singled out as major concerns (‘Report on the protection and enforcement of intellectual property rights in third countries’, n 526 above, 47). ACTA, Arts 27(3) and 27(4). See paras 21.246–21.247 above in this regard.

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been entirely removed from the CETA text. Even though CETA does not contain any ‘threestrikes’ mechanism, and it does provide ‘safe harbours’ for ISPs, supporters of internet freedom and civil liberties have expressed concerns about CETA.644 The most-favoured-nation (MFN) clause of the TRIPS Agreement has significant implications 21.258 when it comes to imposing ‘TRIPS-plus’ standards in FTAs. It implies that those countries that sign significant intellectual property provisions with any WTO member (thus including, e.g., the US) are obliged to extend the same treatment to all other members. The MFN clause has allowed the EU to free ride on intellectual property provisions that the US has imposed on its trading partners. EFTA countries also derived benefits from the FTAs concluded by the EU and the US, since developing countries that have signed such agreements with either of them must treat EFTA Members identically.645

2. Non-legislative actions A. Intellectual property dialogues and IPR working groups On the non-legislative front, ‘Intellectual Property Dialogues’ and ‘IPR Working Groups’ were 21.259 established between the Commission and certain ‘priority countries’646 and other partner countries with which an agreement is in place covering intellectual property issues. These include, amongst others, the Andean Community (Colombia, Peru, and Ecuador), Central America, Canada, China, Hong Kong (China), South Korea, Taiwan, Thailand, Turkey, Ukraine, and the US. These dialogues aim to tackle issues relating to the lack of effectiveness of intellectual property legislation, the low responsiveness of Customs or law enforcement agencies in fighting IPR infringements, etc. Depending on the issues, the Commission may then offer assistance to improve the legislative or institutional frameworks in place in the relevant countries. The setting up of ‘IP Dialogues’ and ‘IPR Working Groups’ is a practical way to address IPR challenges in third countries, in particular for countries with which there is no agreement in place and the EU is not engaged in negotiations. Starting in 2004, structured annual EU-China talks on IPRs have been held once a year alternately 21.260 in Brussels and in Beijing, enabling both sides to share information on multilateral/bilateral IPR issues and national intellectual property legislation and practices, and identify shortcomings and proposals for improvement. An Action Plan was also designed over the last few years to increase Customs cooperation on the enforcement of IPRs.647 The plan concentrates on five key areas, namely the exchange of statistical information, the creation of a network of Customs experts in key ports, the enhancement of cooperation with other enforcement administrations, development of partnerships with business communities, and exchange of knowledge and experience of IPR

644

645 646 647

See, e.g., M. Geist, ‘Beyond ACTA: Proposed EU-Canada trade agreement intellectual property chapter leaks’, (16 December 2009); G. Moody, ‘ACTA’s back: European Commission trying to sneak in worst parts using Canada-EU trade agreement as a Trojan Horse’, (9 July 2012); M. Geist, ‘ACTA Lives: How the EU and Canada are using CETA as backdoor mechanism to revive ACTA’, (9 July 2012); Electronic Frontier Foundation, ‘Canada-EU trade agreement replicates ACTA’s notorious copyright provisions’, (23 October 2012). Taylor, n 545 above, 103–4. See para. 21.200 above. Detailed reports on the IP Dialogues in individual countries can be found on DG TRADE’s website, . See the Press Release IP/09/193 of 30 January 2009, . The 2004 Customs Cooperation and Mutual Administrative Assistance Agreement (CCMAA) provided the legal basis for subsequent strengthened cooperation under the EU-China Action Plan on IPR Customs enforcement: see Agreement between the European Community and the Government of the People’s Republic of China on cooperation and mutual administrative assistance in Customs matters [2004] OJ L375/20.

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enforcement policies and practices. The plan was adopted in 2004. It was extended in 2009 until the end of 2012,648 and then again in 2013. During the EU-China summit held in Brussels on 2 June 2017, the EU and China’s Customs Administration have reaffirmed their commitment to trade security and facilitation by signing the Strategic Framework for Customs Cooperation 2018–2020. The implementation of this Framework, which reiterates the main objectives of mutual cooperation and assistance between the EU and China, was discussed at the tenth meeting of the EU-China Joint Customs Cooperation Committee in Brussels on 26 June 2019, with an emphasis on IPR enforcement.649 The EU-China IP Dialogue, which was launched in 2005, was complemented by an EU-China ‘IP Working Group’, which usually takes place twice a year, with the participation of European industry.650 The Working Group focuses on concrete issues or sectors. 21.261 The EU and the US also established an Intellectual Property Dialogue, through a ‘Transatlantic IPR Working Group’, which was created in 2005. The Working Group is composed of officials representing lead agencies and services from both the EU and the US. It was constituted to identify the areas and modalities for joint action. It works in close consultation with industry and other interested parties. In 2006, the EU and the US agreed on an ‘Action Strategy for the Enforcement of Intellectual Property Rights’, aiming to increase cooperation to strengthen border enforcement of IPRs, to step up their actions to encourage third parties – both at the bilateral and multilateral levels – to enforce IPRs and combat counterfeiting and piracy, and to promote public–private partnerships. Officials from both sides of the Atlantic reported on ongoing cooperative efforts to strengthen IPR protection globally and more specifically in Brazil, China, India, and Russia. Officials reviewed the current status of a number of multilateral discussions which were then underway within the WTO, the OECD and the UN. They also agreed to continue to cooperate in the development of web-based intellectual property resources that would benefit SMEs. US and EU Customs officials noted the success of past joint operations and information exchanges and indicated that discussions are ongoing for future joint operations. Finally, US and EU officials discussed their respective bilateral efforts to strengthen IPR protection and capacity building.

B. Technical cooperation 21.262 Technical assistance on IPRs, as well as financial cooperation, are also provided by the EU to developing and least-developed WTO members, in accordance with Article 67 of the TRIPS Agreement. Surveys show that there is a real demand from right holders, local authorities, and other stakeholders for more technical cooperation in developing countries, which often lack the resources and/or skills to improve their IPR system. Training courses for Customs and law enforcement agencies and for judges are thus set up on a regular basis on request. The Commission has signed an agreement with the EUIPO for the implementation of three ‘IP Key’ cooperation programmes: China, Latin America, and South-East Asia.651 The IP Key programmes are designed to enhance the EU’s cooperation with third countries through concrete activities in the area of IPR protection and enforcement. The latest IP Key programmes started in September 2017 and will be running for four years. Other examples include: the Action Plan on Euro-Mediterranean Cooperation on the Fight against Counterfeiting and Piracy, which was endorsed in March 2018;652 and a four-year cooperation programme for Africa, that was adopted by the EU in May 2019 with the aim of improving the standards for IPR protection and enforcement in the African Continent and to

648 649 650 651 652

See . See and . ‘Report on the protection and enforcement of intellectual property rights in third countries’, n 526 above, 20, and . . .

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support the Pan-African Free Trade negotiations.653 The ASEAN Regional Integration Support from the EU (ARISE Plus) programme has been in place for several years with the aim of supporting greater economic integration in ASEAN countries, inter alia by improving IPR protection and enforcement.654 An IPR cooperation programme was also launched in 2019 focusing on IPR enforcement in the framework of the EU-Gulf Cooperation Council.655 In 2008, the Commission also launched a number of initiatives targeting end-users, which aim to 21.263 enable EU right holders, especially SMEs, to make the best IPR decisions for their business and to ensure they know how to effectively protect their intangible assets. Those initiatives include the highly successful ‘China IPR SME Helpdesk’, based in Beijing, offering business tools to help SMEs producing or sourcing from China develop their IPRs and manage the related risks. The term of the China IPR SME Helpdesk was extended for another three years at the beginning of 2018.656 Given the positive feedback from users of this tool, the Commission decided to set up an ASEAN IPR SME Helpdesk and a Mercosur IPR SME Helpdesk, which were launched in 2013.657 The launch of an IPR SME Helpdesk in India is planned in 2020.658 Several EU Member States also have ‘IP attachés’ within their delegations in key countries. The helpdesks cooperate with local authorities and provide free-of-charge first-line personalised expert advice, training, webbased self-help materials, and liaison with outside experts and with target government administrations, business networking, and awareness events.

C. Participation in international fora i.

The World Trade Organization (WTO)659

As a Member of the TRIPS Council, the EU submitted a Communication in June 2005 proposing 21.264 a detailed assessment of the enforcement practices among the WTO membership. The Commission also managed to put IPR enforcement on the agenda of each Council meeting. Several emerging countries, such as India, Brazil, Ecuador, Argentina, and Nigeria, opposed discussion on the topic,660 while a number of other third countries indicated that they prefer bilateral to multilateral agreements on intellectual property enforcement. The existence of WTO dispute settlement procedures, that can be resorted to for breaches of the TRIPS Agreement, can act as a detering mechanism to potential infringements. The EU regularly raises the problem of the non-compliance by the US with WTO dispute settlement decisions (e.g., in the Irish Music case)661 at the WTO Dispute Settlement Body.662 It also made a third-party written submission in the case WTO DS/567: Saudi Arabia – Measures concerning the protection of intellectual property rights.663 The EU has also submitted annual reports in accordance with Article 67 of the TRIPS Agreement on technical cooperation programmes provided by the EU and its Member States in favour of developing and least developed WTO Members, with the objective to facilitate the implementation of the TRIPS Agreement.664 EU companies, for their part, have been able to lodge complaints under the trade barriers instruments665 regarding possible breaches of intellectual property rules.

653 654 655 656 657 658 659 660 661 662 663 664 665

‘Report on the protection and enforcement of intellectual property rights in third countries’, n 526 above, 14. Ibid., 26. Ibid., 43. Ibid., 21. Ibid., 26. Ibid., 24. Regarding the IPR SME Helpdesks, see . . ‘Report on the protection and enforcement of intellectual property rights in third countries’, n 526 above, 6. See n 523 above. ‘Report on the protection and enforcement of intellectual property rights in third countries’, n 526 above, 10. See n 523 above. ‘Report on the protection and enforcement of intellectual property rights in third countries’, n 526 above, 14. .

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ii.

The World Intellectual Property Organization (WIPO)666

21.265 WIPO is the United Nations agency dedicated to the use of IPRs as a means of stimulating innovation and creativity. It promotes the development of the international legal intellectual property framework. Thus, it administers IPR treaties such as the Paris Convention for the Protection of Industrial Property, the Berne Convention for the Protection of Literary and Artistic Works, the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations, the WCT and the WPPT, to name but a few.667 The Organization also runs systems which make it easier to obtain protection internationally for patents, trademarks, designs, and geographical indications, and to resolve intellectual property disputes. 21.266 The European Commission and the European Council have both been welcomed by WIPO as observers at the formal meetings of its Member States. Various WIPO Committee Meetings have dealt with intellectual property enforcement issues over the last decade. The Program and Budget for the 1998–99 biennium provided for the establishment of the Advisory Committee on Protection of Industrial Property Rights in Global Electronic Commerce (ACP/IP) and the Advisory Committee on Management of Copyright and Related Rights in Global Information Networks (ACMC). One year later, the ACP/IP was renamed Advisory Committee on Enforcement of Industrial Property Rights (ACE/IP) and provision was made to include enforcement issues within the mandate of the ACMC, which became the Advisory Committee on Management and Enforcement of Copyright and Related Rights in Global Information Networks (ACMEC). A Consultation Meeting on Enforcement was held in September 2002, in which various issues pertaining to the enforcement of IPRs were discussed, focusing in particular on training needs and development of enforcement strategies668 and on issues concerning difficulties and practices in the field of enforcement.669 Following this meeting, the WIPO General Assembly approved the establishment of the Advisory Committee on Enforcement (ACE). The European Commission acceded to full participation in this Committee in 2006. 21.267 The mandate of the ACE670 is defined as technical assistance and coordination. Norm setting is excluded. Its main objectives include: coordinating with certain organisations and the private sector to combat counterfeiting and piracy activities, awareness-raising, assistance, coordination to undertake national and regional training programmes for all relevant stakeholders, and exchange of information on enforcement issues. ACE’s work programme includes, inter alia, targeted studies with an aim to develop analytical methodologies that measure the social, economic and commercial impact of the phenomenon of counterfeiting and piracy on societies and the analysis of various models to address the challenges posed by this phenomenon. 21.268 WIPO’s work in the field of IPR enforcement aims to support informed and empirically well-founded policy discussions at the international level, and to strengthen capacity in WIPO’s Member States, in the interests of social and economic development and consumer protection. WIPO’s activities in this area are guided by Recommendation No 45 of the WIPO Development Agenda,671 adopted by WIPO’s Member States in 2007, which aims:

666 667 668 669 670

671

. An exhaustive list of WIPO-administered treaties is available at . Document WIPO/CME/2 Rev., . Document WIPO/CME/3, . Document WO/GA/28/7, paras 114(i) and 120, . For more information on ACE’s meetings and activities, see . .

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VI. THE FIGHT AGAINST PIRACY IN THIRD COUNTRIES [t]o approach IP enforcement in the context of broader societal interests and especially developmentoriented concerns, with a view that ‘the protection and enforcement of intellectual property rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology, to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare, and to a balance of rights and obligations’, in accordance with article 7 of the TRIPS Agreement.

‘Building respect for IP’ constitutes WIPO’s Strategic Goal VI. A special division ‘Building Respect 21.269 for IP’ has been set up within WIPO, whose activities include: (i) servicing the sessions of ACE; (ii) providing legal, strategic and technical assistance to Member States, upon request; (iii) closely liaising with public and private partner organisations to ensure constructive, result-oriented international cooperation in line with WIPO’s strategic approach to building respect for intellectual property; and (iv) facilitating the exchange of information relating to intellectual property enforcement. Regarding legislative advice, WIPO scrutinises the compatibility of existing or draft legislation with enforcement-related obligations under Part III of the TRIPS Agreement. As regards capacity building, WIPO organises numerous national or regional workshops, conferences, seminars, and training courses for judges, prosecutors, police and customs officials.672 WIPO has also published a series of Case Books on the enforcement of IPRs, which analyse and discuss recent case law developments in common and civil law countries.673 In ACE’s annual meetings of September 2018 and September 2019, the Commission participated in the discussion on initiatives taken to address online IP infringements, and presented the state of play of the MoUs on the Sale of Counterfeit Goods via the Internet and on Online Advertising and IPR.674 In December 2018, it also contributed to a stakeholders’ meeting on Building Respect for IP (BRIP) Database Project,675 a secure online platform designed to aggregate lists of websites suspected of infringing copyright that are managed by several national administrations around the world. By checking with the BRIP Database, advertisers and advertising intermediaries can ensure that advertising does not accidentally appear on copyright-infringing websites.676 Overall, while some commentators note that the European Commission’s participation in ACE was 21.270 useful at least in terms of awareness-raising on the importance of IPR enforcement, there has been a lack of shared willingness for action in this forum, particularly from developing countries.677 iii.

The Organisation for Economic Co-operation and Development (OECD)

The Organisation for Economic Co-operation and Development (OECD) is an international 21.271 organisation that aims to shape policies that foster prosperity, equality, opportunity and well-being for all. Together with governments, policy-makers and citizens, it works on establishing evidencebased international standards and finding solutions to a range of social, economic and environmental challenges. It is a unique forum and knowledge hub for data and analysis, exchange of experiences, best-practice sharing, and advice on public policies. Over the last decades, the OECD has played a major role in trying to quantify the scope of international trade in counterfeit and pirated goods. The joint studies it has conducted with the EUIPO’s Observatory on Infringements of IPRs have made a big step forward in this area and have also highlighted the role of free trade zones and small consignments in the dissemination of counterfeit and pirated goods.678

672 673 674 675 676 677 678

Between November 2011 and September 2012, no less than 14 such events took place at WIPO’s initiative (see document WIPO/ACE/8/2, ). . See paras 21.197–21.198 above regarding these MoUs. . ‘Report on the protection and enforcement of intellectual property rights in third countries’, n 526 above, 15. ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’, n 19 above, 31. See para. 21.03 and n 121 above in this regard.

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iv.

The World Customs Organization (WCO)679

21.272 The EU has been granted a status akin to membership within the World Customs Organization (WCO). With its 183 member administrations, the WCO greatly contributes to the development of customs cooperation worldwide. In the last 20 years, it has developed an impressive anticounterfeiting programme based on the sharing of best practices, training courses and operational seminars, and risk analysis. However, the initiatives in this field have been reduced in recent years. Its set of IPR Model Legislation, which aimed to help its members in drafting or revising their border measures legislation designed to protect IPRs without interfering with legitimate trade, have been taken offline some time ago, as has its tool called IPM (Interface Public Members), which complemented the WCO’s Customs Enforcement Network (CEN) and allowed right holders to share information assisting customs officers in distinguishing genuine goods from fakes. 21.273 Public–private partnership has consistently played an important role in the strategies designed by the WCO to combat counterfeiting and piracy. Intellectual property right holders have been invited to participate in the WCO’s reflections in this area through the WCO IPR Strategic Group, which was later followed by the SECURE680 Working Group, the aim of which was to further develop and promote IPR legislative and enforcement regimes, risk analysis and intelligence sharing, international cooperation and capacity building programmes. SECURE was halted owing to opposition from a group of South American countries led by Brazil and Ecuador, who feared that the working group would be used to set norms and to put new obligations on the WCO Members.681 SECURE was consequently replaced by a Counterfeiting and Piracy Group (CAP), which still provides a platform for the exchange of best practices on intellectual property related issues today. Through its IPR, Health and Safety Programme, the WCO delivers capacity building actions, coordinating efforts of its Members and related international organisations. In that framework, the WCO organises regional and national seminars for operational customs officers and conducts diagnostic missions that include the review of national legislation, analysis of countryspecific risks, engagement of right holders and national authorities, etc. 21.274 In the field of risk analysis, the WCO has designed a detailed Risk Management Compendium682 to increase the effectiveness of customs controls. The WCO has also developed e-learning modules. Last but not least, it has conducted a significant number of operations on all continents, which led to the seizure of millions counterfeit items.683 v.

The International Criminal Police Organization (Interpol)

21.275 Since 2003, Interpol’s Intellectual Property Crime Programme and Action Group have developed a strong partnership with law enforcement authorities, governments, and major business sectors affected by counterfeiting and piracy. As already mentioned,684 the operational intellectual property crime project set up by Europol in January 2008 to counter the growing involvement of organised crime in counterfeiting and piracy involves close cooperation, and on occasion joint operations, between Europol, Interpol, the US Immigration and Customs Enforcement (ICE), OLAF, and the EU Member States. Europol’s cooperation with Interpol is paramount: with its 194 member countries, Interpol allows investigators to gather and exchange intelligence from law enforcement agencies established in countries where counterfeit and pirated goods are produced. The Interpol General Assembly adopted the first resolution on intellectual property crimes in 1994. Intellectual 679 680 681 682 683 684

. SECURE stands for ‘Standards to be Employed by Customs for Uniform Rights Enforcement’. ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’, n 19 above, 31. . See, in this regard, the WCO’s Illicit Trade Report 2018, n 23 above. See also the WCO’s Annual Report 2018-2019, . See paras 21.123 and 21.126.

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property crime was added to the organisation’s official mandate in 2000. Interpol also provides specialised intellectual property crime training courses for law enforcement bodies and has set up a team of intellectual property crime investigators under the umbrella of the International Intellectual Property Crime Investigators’ College (IIPCIC) – a fully interactive online training facility on the subject of IP crime, designed to benefit all law enforcement, regulatory authorities and private sector investigators.685 vi.

The Group of Eight (G8)

The Group of Eight (‘G8’) is made up of the governments of eight of the world’s largest economies, 21.276 i.e., Canada, France, Germany, Italy, Japan, Russia, the UK and the US. The EU is represented within the G8 by the President of the Commission and the leader of the country that holds the Presidency of the Council of the EU. It has the privileges and obligations of membership, but cannot host or chair summits. The President of the European Commission has attended all meetings since it was first invited by the UK in 1977, and the Council President now also regularly attends. The European Commission has been actively participating in setting IPRs high on the G8 21.277 agenda.686 During the Gleneagles Summit in Scotland in July 2005, the G8 parties agreed on the statement ‘Reducing IPR Counterfeiting and Piracy through effective enforcement’ and made important commitments to help in combating counterfeiting and piracy.687 These commitments were reaffirmed at the St Petersburg Summit on 16 July 2006.688 In a Declaration made on 7 June 2007689 at the G8 Summit in Heiligendamm, Germany, the G8 reiterated its ambition to look at how best to improve the working of international IPR protection and enforcement. This Declaration outlined a number of projects that the G8 IPR Expert Group (IPEG) had discussed and set out plans to take them forward. It further referred to the establishment of an IPR Task Force focusing on anti-counterfeiting and anti-piracy. This Declaration also refers to the ‘Heiligendamm Process’ which was announced as a dialogue between the G8 and the important emerging economies – Brazil, China, India, Mexico, and South Africa. The OECD was called upon to provide a platform for this new dialogue.690 On 25 May 2007, the G8 Justice and Home Affairs Ministers also met in Munich. In their Concluding Declaration, they recognised that product counterfeiting and piracy damage the innovative capacity of national economies, and pointed to the important roles of civil and criminal enforcement. The Ministers supported the development of a plan to encourage developing and newly industrialised countries that are interested in using civil and criminal law to promote the effective enforcement of IPRs. The G8’s commitments in the field of anti-counterfeiting and anti-piracy were restated in the July 2008 G8 Hokkaido Toyako Summit Declaration on the World Economy, in which the G8 members supported ‘the acceleration of negotiations to establish a new international legal framework, the Anti-Counterfeiting Trade Agreement (ACTA)’. The statement adopted by the IPEG at the end of the L’Aquila Summit in 2009 endorsed the initiative to negotiate bilateral, plurilateral and multilateral instruments to strengthen IPR enforcement.691

685 686 687 688 689 690

691

. ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’, n 19 above, 8. . ‘Combating IPR Piracy and Counterfeiting’, . ‘Growth and Responsibility in the World Economy’, (see, in particular, section on ‘Promoting Innovation – Protecting Innovation’). See the ‘Joint Statement by the German G8 Presidency and the Heads of State and/or Government of Brazil, China, India, Mexico and South Africa on the occasion of the G8 Summit in Heiligendamm, Germany, 8 June 2007’, . .

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21.278 Unsurprisingly, over the last few years the G8’s attention shifted to the global financial situation. Moreover, the political significance of G8 has faded since the G20 leaders announced, in September 2009, that the Group of Twenty would replace the Group of Eight as the main economic council of wealthy nations.692 vii.

Group of Twenty (G20)

21.279 The Group of Twenty Finance Ministers and Central Bank Governors (‘Group of Twenty’ or ‘G20’)693 is a forum for cooperation and consultation on matters pertaining to the international financial system, which was formally inaugurated in September 1999. It is made of finance ministers and central bank governors from 20 major economies, collectively accounting for more than 80 per cent of the gross world product, 80 per cent of world trade (including EU intra-trade), and two-thirds of the world population. The EU is a G20 member and is represented by the rotating Presidency of the European Council and by the European Central Bank.694 21.280 The G20’s initiatives in the field of IPR protection and enforcement have remained relatively scarce so far. During the G20 London Summit, the group announced on 31 March 2009 that consensus had been achieved in at least one small area of global significance, i.e., the establishment of a World Intellectual Property Litigation Court by 2012.695 Delicate discussions regarding, inter alia, the seat of establishment of the new Court, its composition, and its working languages seem to have undermined this initiative. viii.

UNICRI

21.281 Finally, the United Nations Interregional Crime and Justice Research Institute (UNICRI), too, has set up a dedicated programme on counterfeiting and piracy, based on developing research and guidance for law enforcement authorities in relation to organised crime. In April 2013, it released a report advocating the confiscation of the proceeds of crime as an effective tool against the infiltration of transnational organised crime into the illicit business of counterfeiting and piracy.696 In September 2015, UNICRI organised a workshop in Venice focusing on the positive impact of anti-counterfeiting technologies on the protection of IPRs, economic development, the increased collection of tax revenue, the protection of legitimate trade, and the fight against organised crime.697 Over the last years, in cooperation with the EUIPO, the Institute has been conducting in-depth analyses of case studies on IPR infringements related to operations and investigations led by European law enforcement bodies in selected countries, with a view to strengthening knowledge, developing the skills of key legal stakeholders in the fight against IP offences, and laying the foundation for the development of awareness-raising activities and training sessions for judges and prosecutors.698

692 693 694 695 696 697 698

‘Officials: G-20 to supplant G-8 as international economic council’, CNN, 25 September 2009, . . The other G20 members are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the UK, and the US. . See . United Nations Economic and Social Council, Works of the United Nations Interregional Crime and Justice Research Institute, 5 April 2016, E/cn.15/2016/8, , para. 52. United Nations Economic and Social Council, Report of the United Nations Interregional Crime and Justice Research Institute, 26 March 2019, E/cn.15/2019/8, , paras. 49–50.

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D. The ‘Counterfeit and Piracy Watch List’ In December 2018, considering that marketplaces remain the chief distribution channels for 21.282 IPR-infringing goods in the EU, the Commission published a Counterfeit and Piracy Watch List.699 This non-exhaustive list, which stems from public consultation processes, identifies online and physical marketplaces situated outside the EU that are reported to engage in, or facilitate, substantial IPR infringements, and in particular counterfeiting and piracy, focusing on websites providing copyright-protected content, e-commerce platforms, physical marketplaces, and online pharmacies. The Watch List, which the Commission is planning to update on a regular basis, is intended to encourage governments, local law enforcement and operators to take action and raise awareness among EU citizens of the risks of purchasing from these marketplaces.

3. Assessment of the EU’s foreign policies on IPR enforcement The implementation of the Commission’s IPR Enforcement Strategy in Third Countries was 21.283 assessed in 2010 by an external contractor. The evaluation report identified six main internal and external factors which affected effective implementation of the strategy, i.e.: + + +

+ + +

the controversial status of IP enforcement, which limited the possibilities for and effectiveness of Commission actions in several third countries and efforts at multilateral level; the hard-line approach on enforcement, which diluted the goodwill the Commission had built up in trade and intellectual property matters, and pushed third countries into a defensive position […]; the strong linkage of IP enforcement with trade matters, which left aside other fundamental linkages with areas in which suppression is more widely acceptable (e.g., organised crime, money laundering, internal fraud, or tax evasion); the lack of harmonisation within the EU [as regards criminal enforcement of IPRs], which affected the credibility of messages addressed to third countries; the lack of reliable and comprehensive data on the level of infringements but also on the issue in general, which made it difficult to define relevant policies and optimise prioritisation of actions; and the lack of or minimal awareness of the Strategy by external parties, who knew the Commission was active in IP enforcement but did not know that its action was based on a structured Strategy document, which limited the power of the message and the approach taken.700

The report also concluded that what is required in many third countries is not more legislation, or 21.284 even better legislation. Laws are already up to the mark in many countries. ‘What is lacking is the technical capacity to implement and enforce the rules, regulations, laws and sanctions. The experience of this evaluation is that technical cooperation projects on IP – with an appropriate funding – are more successful as part of bilateral agreements […]’.701 Based on these conclusions, the report formulated a number of recommendations. First, the 21.285 Commission was called upon to clarify the objectives it is pursuing in terms of IPR enforcement in third countries, ‘notably in terms of the hierarchy of potentially conflicting objectives (e.g., support for EU right holders, generation of EU jobs, protection of EU consumers)’.702 Second, the Commission’s approach should integrate aspects of relatively direct benefit to third countries. It should, for example, find ways to foster access to technology for the poor and encourage technology transfer to SMEs;703 in the field of copyright, it should promote fair access to cultural heritage and to information. Third, the EU Observatory on IPR Infringements should become a single point of

699 700 701 702 703

. ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’, n 19 above, 61. Ibid., 68. Ibid., 70. Ibid., 72.

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contact within the EU for external parties, and an international point for creation and dissemination of best practice. EU harmonisation should also be increased, inter alia on criminal sanctions.704 Fourth, consultation mechanisms should ensure that the views of both SMEs and consumers, beside those of right holders and other parties already involved, are clearly heard and taken into account; consumers are indeed identified by the Commission as one of the key target beneficiary groups for IPR enforcement.705 Fifth, in countries with which the EU (or the US) had already concluded a bilateral agreement including a specific IPR chapter, the Commission should further develop technical cooperation, including training and awareness-raising, and promote IP Dialogues. Sixth, pursuing legislation improvements should only be considered in countries with which no such agreement has yet been signed.706 Seventh, the EU should mobilise resources for ambitious technical cooperation programmes on IPR enforcement in respect of practical training of officials, law enforcement agents, and judges, with an emphasis on promoting awareness of the economic and social impact of IPR infringements.707 Eighth, the Commission should ensure that the technical cooperation programmes are well designed, targeted, and customised to local needs.708 Finally, the EU should foster the development of a methodology for collecting, analysing and comparing data on counterfeiting and piracy. ‘Better statistics and information allow better understanding of the issue of counterfeiting and piracy and hence form the basis for more relevant and focused policies and prioritisation of actions’.709 21.286 Following consultation of intellectual property stakeholders, the Commission made its own assessment of the Strategy in 2013. The data suggests that problems in the area of copyright were somewhat less frequent than for trademarks. The most frequently suffered infringements related to trademarks (mentioned by 44 per cent of the respondents to the survey), followed by patents and copyrights (each mentioned by about 24 per cent of the respondents).710 The survey shows that the copyright legislation of a number of key countries, such as China, Brazil, and Malaysia, was revised in recent years, or is in the process of being reviewed.711 However, although efforts and improvements from national authorities are obvious, ‘there is much room for improvement in third countries of the protection and enforcement of IP rights’. The Commission concludes that IP Dialogues and technical cooperation projects should continue.712 21.287 In its Communications of 1 July 2014 ‘Trade, Growth and Intellectual Property – Strategy for the Protection and Enforcement of Intellectual Property Rights in Third Countries713 and of 29 November 2017 ‘A Balanced IP Enforcement System Responding to Today’s Societal Challenges’,714 the European Commission came to the conclusion that it was necessary to update the 2004 strategy in order to take account of the insights from the 2010 evaluation and pursue the challenges highlighted on that occasion. Both Communications are intended to ensure continuity to the policy pursued by the EU since 2004, by building on what worked well and enhancing it in view of the technological changes and IPR-related new challenges and societal evolutions. The new Strategy aims to:

704 705 706 707 708 709 710 711 712 713 714

Ibid. Ibid., 74. Ibid., 74–5. Ibid., 75. Ibid. Ibid., 77. Commission Staff Working Document of 5 February 2013 ‘Report on the protection and enforcement of intellectual property rights in third countries’, COM(2013) 30 final, 5. Ibid., 7, 11, and 16. Ibid., 21. See n 95 above. See n 97 above.

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VII. CONCLUSION: WHERE DO WE STAND AND WHERE ARE WE GOING?

+ interact with all stakeholders on a regular basis to raise awareness and guide policy; + conduct regular surveys in order to maintain and update the list of ‘priority countries’ for focused EU efforts; + continue and where possible enhance ‘IP Dialogues’ with key third countries; + increase the availability of intellectual property expertise in EU Delegations in key regions, either through additional staff or through IPR Helpdesks; + provide and promote awareness of appropriate IP-related technical assistance programmes to third countries, including on the possible use of intellectual property flexibilities; + strengthen the relationship between the Commission, EU Member States and EU businesses to support economic operators in overcoming concrete difficulties on intellectual property issues; + for countries that persistently break international commitments on intellectual property rules in ways that have a significant impact on the EU, and where the authorities are unwilling to cooperate or where cooperation shows limited results, the Commission may consider, in serious and targeted cases, restricting their participation or funding in specific EU-funded programmes, without however affecting programmes financed by the European Development Fund or Development Cooperation Instrument;715 + ensure the Commission can make recourse to dispute settlement procedures or other remedies where the EU’s rights under international agreements are infringed; + continue multilateral efforts to improve the international IPR framework, including by encouraging further ratification of existing treaties; + ensure that IPR chapters in bilateral trade agreements offer adequate and efficient protection for right holders and address key weaknesses in partner countries’ IPR systems while calibrating commitments to third countries’ level of development.

VII. CONCLUSION: WHERE DO WE STAND AND WHERE ARE WE GOING? Over the last quarter of a century, the issue of the enforcement of IPRs has been brought to the 21.288 forefront of the European and international debates, leading to the adoption of initiatives by international organisations such as the WTO and, more recently, the WCO, WIPO, the OECD, the G8, and the G20. Overall, however, little attention has been devoted to the enforcement of copyright and related rights. Moreover, the main initiatives have been limited to promoting enhanced cooperation at the international level in the field of IPR enforcement. The ‘Additional Enforcement Measures for Multilateral Level Consideration’ proposed by the OECD in its 2008 report716 are unlikely to become law in the short or middle term. And yet, there is a common understanding that there is no point in establishing a comprehensive 21.289 system for the protection of IPRs if these rights are not backed by strong and effective enforcement provisions.717 There also is common agreement that the global intellectual property landscape differs significantly from that in which the TRIPS Agreement was concluded in 1994.718 A new

715 716 717 718

‘Trade, growth and intellectual property – Strategy for the protection and enforcement of intellectual property rights in third countries’, n 95 above, 17. OECD, The Economic Impact of Counterfeiting and Piracy (n 15 above), see Table 5, 214–5. ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’, n 19 above, 3. Ibid.

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enforcement treaty therefore seems to be very much needed. In their Biarritz Declaration of 26 August 2019, the G7 Leaders expressed their willingness to overhaul the WTO to improve effectiveness with regard to intellectual property protection.719 However, the debacle of ACTA in Europe shows that a ‘one-size-fits-all’ approach to international IPR norm setting has limits. Beside open collaboration and alternative innovation models, drafting a tailor-made treaty specifically dealing with the enforcement of copyright and related rights in the digital environment, following the model of the WIPO Internet Treaties – which, although limited in scope, have proved to be quite successful – should indisputably be considered. But the negotiations should then be conducted in full transparency, unlike those surrounding ACTA. 21.290 At the international level, the European Commission has played an active role in recent times on IPRs at multilateral level. However, it has reaped only limited rewards, owing mainly to third country opposition.720 As the Commission puts it, ‘[a]ttempts by the EU and other supporters of an effective IPR system to constructively address enforcement in multilateral fora (WTO, World Intellectual Property Organization (WIPO), World Customs Organization (WCO)) continue to be opposed by countries such as India, Brazil, Ecuador, Argentina, Nigeria and others’.721 Overall, the Commission’s IP Dialogues achieved limited success too,722 even though in some countries the EU has been very successful in tackling copyright-related issues.723 More progress was achieved in countries with which FTAs, EPAs, or PCAs were signed, even though the EU recognised in 2014 that: the negotiation of IPR chapters will remain challenging. Many of the countries that the EU is in negotiations with (or about to start negotiations) have the perception that they stand little to gain from a strong IPR regime. To achieve meaningful outcome for the EU will therefore require continuous awareness-raising and outreach for all stakeholders at both technical and at times at political level.724

The Commission was also quite successful in strengthening the national legal frameworks through technical cooperation programmes such as the ‘IP Key’ programmes. Unfortunately, some countries showed little willingness to strengthen their intellectual property legislation;725 they usually consider that the EU should have been putting its own house in order first (e.g., as regards criminal measures, statistics, and awareness) before preaching to third countries.726 Much remains to be done to bring the enforcement system of most countries in line with the TRIPS requirements.727 Customs enforcement in general has been enhanced in many of the priority countries identified by the Commission. While IPR criminalisation has grown rapidly in many non-EU countries, this is not the case for prosecutions, primarily because IPR infringements are not always perceived to be morally reprehensible.728 In the meantime, counterfeiting and piracy are still on the rise since 2005, as a result of the globalisation of the economy.729 21.291 As far as the internal market is concerned, although EU law provides a globally effective framework for the enforcement of IPRs, which goes beyond all that has been achieved on the international

719 720 721 722 723 724 725 726 727 728 729

See . Ibid., 30–33. ‘Report on the protection and enforcement of intellectual property rights in third countries’ (2013), n 708 above, 6. ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’, n 19 above, 30–33. Ibid., 52. ‘Trade, growth and intellectual property – Strategy for the protection and enforcement of intellectual property rights in third countries’, n 95 above, 17. ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’ (2013), n 708 above, 30–33. Ibid., 29. Ibid., 43. Ibid., 44 and 52–3. Ibid., 48.

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VII. CONCLUSION: WHERE DO WE STAND AND WHERE ARE WE GOING?

front so far, substantial problems remain, particularly concerning enforcement in the digital environment. The clash between the need to protect IPRs and the need to protect other fundamental rights, which form part of the legal traditions of both the EU and its Member States, has, to some extent, hindered the effective enforcement of IPRs, especially in the digital era. The tension between the different fundamental rights recognised by EU law was demonstrated by the refusal of the European Parliament to adopt ACTA. The EU has set up an efficient legal framework for the enforcement of IPRs – including copyright 21.292 and related rights – by Customs at its external borders. However, the scope of this framework was substantially reduced by the CJEU’s judgment in the Philips & Nokia case. Regulation 608/2013 on the customs enforcement of IPRs, which replaced Regulation 1383/2003, does not close the loophole opened (or revealed) by the Court. While some initiatives have been taken by the EU in order to solve the issue in the area of trademark counterfeiting and infringements of geographical indications for spirit drinks, copyright-infringing goods from outside the EU which transit via the EU on their way to destinations outside the EU will, on many, if not most occasions, be able to avoid seizure by Customs at the EU’s external borders, to the bitter disappointment of right holders. As a civil law instrument, the IPRED is another useful tool for combating IPR infringements. In 21.293 2006, the EU therefore set itself the objective of importing the provisions of this instrument into its future bilateral agreements, thus imposing on its trading partners IPR enforcement measures surpassing the minimum standards of the TRIPS Agreement. However, as demonstrated by CJEU case law, the IPRED is not entirely satisfactory. The implementation of many of its provisions in the Member States has been prevented by personal data protection legislation. The right of information set out in Article 8 of the Directive, for example, which should logically have allowed the holders of IPRs to quickly identify alleged infringers, and thus to take action against them, has thus lost much, if not all, of its intended effect in practice, at least in some Member States. This problem is particularly significant in the digital environment. As regards the fight against online infringements, the liability ‘safe harbours’ created by the 21.294 E-Commerce Directive in favour of ISPs are counter-balanced by a ‘notice-and-take-down’ system and the opportunities offered to right holders by the provisions of the InfoSoc Directive and the IPRED to request the courts to impose injunctions on service providers, and – last but not least – the provisions of the new DSM Directive imposing greater accountability on online contentsharing service providers. It remains to be seen, of course, how the EU Member States will implement the provisions of the DSM Directive into their domestic legislation; in certain Member States, the substance of the provisions of the E-Commerce and InfoSoc Directives and of the IPRED has been removed in their transposition into national law. The Commission’s intention to modernise the current legal framework on IPR enforcement by 21.295 revising the E-Commerce Directive and the IPRED, announced in its Communication ‘A Single Market for Intellectual Property Rights’ of 24 May 2011730 and supported by, inter alia, the ‘Digital Agenda for Europe’731 (adopted in 2010 as an integral part of the ‘Europe 2020 Strategy’732 to stimulate the digital economy and address societal challenges through ICT), the ‘Single Market

730

731

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Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions ‘A Single Market for Intellectual Property Rights. Boosting Creativity and Innovation to Provide Economic Growth, High Quality Jobs and First Class Products and Services in Europe’ (n 91 above). Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 26 August 2010 ‘A Digital Agenda for Europe’, COM(2010) 245 final/2. Communication from the Commission of 3 March 2010: ‘Europe 2020: A European strategy for smart, sustainable and inclusive growth’, n 266 above.

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Chapter 21 THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY

Act’,733 and the ‘Innovation Union’,734 has so far remained a dead letter, despite a public consultation on this subject.735 Should the EU fail to adopt new legally binding standards to fight against online piracy and counterfeiting, it is expected that ‘soft law’ solutions will continue to be favoured. The Member States, from their side, will carry on with their attempts to solve the issues in disparate ways, very much to the detriment of an effective enforcement of IPRs, which more than ever requires a cross-border approach. 21.296 Who knows today if the failed attempt by the Commission in 2002 to give the EU a legal framework for the enforcement of IPRs through criminal sanctions will rise again from the ashes? It is rumoured in Brussels that the Commission has not yet definitively shelved this idea. 21.297 As regards the institutional framework, the lack of a central point of contact among the Commission’s many Directorates General assuming IPR enforcement responsibilities has been singled out as a real issue over time. Some have pleaded for the appointment of a high-level IP coordinator who would lead the overall EU Intellectual Property Protection. It is to be hoped that the European Observatory on Infringements of Intellectual Property Rights will be called upon to play this role. Different actions under the EU’s ‘IPR Enforcement Strategy in Third Countries’ lack coordination between the DGs, while there is also little cooperation or coordination overall between the EU and its Member States. Difficulties have also been highlighted regarding the distribution of competences between the EU institutions and the Member States, for example on criminal sanctions.736 21.298 However, the number one priority for the years to come might, in fact, be elsewhere. Although IPRs are private rights, they are granted on the basis of a contract with the public authorities; there is, therefore, a responsibility on the part of the latter to ensure that those rights are properly enforced. The current debate is how to achieve an appropriate balance between private rights and public interest.737 The ‘IP Perception’ survey which was conducted in 2013 on a panel of 26,500 citizens at the initiative of the European Observatory on IPR Infringements,738 and updated in

733

734

735 736 737 738

Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions ‘Single Market Act. Twelve levers to boost growth and strengthen confidence. “Working together to create new growth”’, COM(2011) 206 final. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions ‘Europe 2020 Flagship Initiative. Innovation Union’, COM(2010) 546 final. Public consultation on the evaluation and modernisation of the legal framework for the enforcement of intellectual property rights: . ‘Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’, n 19 above, 58. Ibid., 4. Cf. para. 15.112 and n 301, 304 and 310 above. The results of this survey showed that European citizens are, in fact, largely favourable to IPRs, which they consider as an important pillar of the economic and social organisation, and that they are supportive of their enforcement. However, more than one-third of them consider that breaking intellectual property laws may be justified to cope with the consequences of limited purchasing power or to protest against an economic model driven by a market economy. The study concluded that this disconnect could partly find its source in the lack of understanding of intellectual property value and the fact that a large majority of the respondents believe that IPR protection does not primarily benefit consumers and citizens, but rather the business and artistic elites. Efforts should, therefore, be made to demonstrate the value that intellectual property brings to European citizens in their day-to-day lives. This is especially so for younger generations. As regards copyright protection, 26 per cent of European citizens between 15 and 24 years old reported having downloaded or accessed copyright-protected content illegally over the 12 months preceding the study (the proportion of men having reported this behaviour was more than twice as high as the proportion of women; education levels also appear to have a significant impact on illegal downloading/streaming and access). The younger generation seems to be particularly inclined to consider that illegally downloading or accessing copyright-protected content is acceptable (42 per cent of the respondents consider this to be the case when it is for personal use, a figure which rises to 57 per cent amongst citizens from 15 to 24 years); 85 per cent of the European citizens surveyed stated that they had a good understanding of the term ‘copyright’.

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NOTES

2017,739 reveals that one-third of Europeans tolerate IPR infringing behaviours. The 2010 evaluation report of the ‘IPR Enforcement Strategy in Third Countries’ concludes that the EU policies in this area have underestimated the importance of raising awareness of key target audiences of the need for IPR enforcement,740 and that in some respects this is one of the most concerning elements of the evaluation. The importance of strengthening IPR enforcement will not be understood as long as such misrepresentations have not been adequately addressed.

NOTES 1. Related instruments Council Act of 18 December 1997 drawing up, on the basis of Art. K.3 of the Treaty on European Union, the Convention on mutual assistance and cooperation between customs administrations [1998] OJ C24/1. Council Act of 29 May 2000 establishing in accordance with Art. 34 of the Treaty on European Union the Convention on mutual assistance in criminal matters between the Member States of the European Union [2000] OJ C197/1. Agreement on Trade-Related Aspects of Intellectual Property Rights, Annex 1C to the Agreement Establishing the World Trade Organization (WTO), signed in Marrakesh on 15 April 1994 (TRIPS). Agreement between the European Community and the Government of the People’s Republic of China on cooperation and mutual administrative assistance in Customs matters [2004] OJ L375/20. Agreement between the European Community and the Kingdom of Denmark on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters [2005] OJ L299/62. Anti-Counterfeiting Trade Agreement between the European Union and its Member States, Australia, Canada, Japan, the Republic of Korea, the United Mexican States, the Kingdom of Morocco, New Zealand, the Republic of Singapore, the Swiss Confederation and the United States of America of 1 October 2011. Berne Convention for the Protection of Literary and Artistic Works, last amended on 28 September 1979. Charter of Fundamental Rights of the European Union [2000] OJ C364/1. Communication from the Commission to the Council, the European Parliament and the European Economic and Social Committee of 30 November 2000 ‘Follow-up to the Green Paper on Combating Counterfeiting and Piracy in the Single Market’, COM(2000) 789 final. Communication from the Commission to the Council, the European Parliament and the European Economic and Social Committee of 11 October 2005 on a Customs Response to Latest Trends in Counterfeiting and Piracy, COM(2005) 479 final. Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and the Committee of the Regions of 4 October 2006 ‘Global Europe: Competing in the World. A Contribution to the EU’s Growth and Jobs Strategy’, COM(2006) 567 final. Communication from the Commission to the European Parliament, the Council, the Economic and Social Committee and the Committee of the Regions of 3 January 2008 on Creative online content in the Single Market, COM(2007) 836 final. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee of 16 July 2008 on a New Industrial Property Rights Strategy for Europe, COM(2008) 465 final. Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee of 11 September 2009 ‘Enhancing the enforcement of intellectual property rights in the internal market’, COM(2009) 467 final. Communication from the Commission of 3 March 2010 ‘Europe 2020: A European strategy for smart, sustainable and inclusive growth’, COM(2010) 2020. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 26 August 2010 ‘A Digital Agenda for Europe’, COM(2010) 245 final/2.

739

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. It appears from this new survey that the percentage of respondents who said that they knowingly accessed pirated content has not changed since 2013 (27 per cent of 15–24 year olds and 10 per cent of all respondents). Ibid., 66.

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Chapter 21 THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 6 October 2010 ‘Europe 2020 Flagship Initiative. Innovation Union’, COM(2010) 546 final. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 9 November 2010 ‘Trade, Growth and World Affairs Trade. Policy as a core component of the EU’s 2020 strategy’, COM(2010) 612 final. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 11 November 2010, ‘Towards a Single Market Act. For a highly competitive social market economy. 50 proposals for improving our work, business and exchanges with one another’, COM(2010) 608 final/2. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 13 April 2011 ‘Single Market Act. Twelve levers to boost growth and strengthen confidence. “Working together to create new growth”’, COM(2011) 206 final. Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 24 May 2011 ‘A Single Market for Intellectual Property Rights. Boosting Creativity and Innovation to Provide Economic Growth, High Quality Jobs and First Class Products and Services in Europe’, COM(2011) 287 final. Communication from the Commission of 18 December 2012 on Content in the Digital Single Market, COM(2012) 789 final. Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee of 1 July 2014 ‘Trade, growth and intellectual property – Strategy for the protection and enforcement of intellectual property rights in third countries’, COM(2014) 389 final. Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee of 1 July 2014 ‘Towards a renewed consensus on the enforcement of Intellectual Property Rights: An EU Action Plan’, COM(2014) 392 final. Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee of 21 December 2016 ‘Developing the EU Customs Union and Its Governance’, COM(2016) 813 final. Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee of 29 November 2017 ‘A balanced IP enforcement system responding to today’s societal challenges’, COM(2017) 707. Communication to the European Parliament, the Council and the European Economic and Social Committee of 29 November 2017 ‘Guidance on certain aspects of Directive 2004/48/EC of the European Parliament and of the Council on the enforcement of intellectual property rights’, COM(2017) 708 final. Council Conclusions of 22 May 2008 on a European approach to media literacy in the digital environment [2008] OJ C140/8. Council Conclusions of 20 November 2008 on the development of legal offers of online cultural and creative content and the prevention and combating of piracy in the digital environment [2008] OJ C319/15. Council Conclusions of 24 September 2009 ‘Making the Internal Market work better’, document 13024/09. Council Conclusions of 27 November 2009 on media literacy in the digital environment [2008] OJ C311/12. Council Conclusions on the EU Customs Action Plan to combat IPR infringements for the years 2018–2022 [2009] OJ C24/3. Council Conclusions of 4–5 December 2014 on IPR enforcement, ; Revised draft Council Conclusions of 1 March 2018 on IPR enforcement, . Convention of 26 July 1995 based on Art. K.3 of the Treaty of the European Union, on the establishment of a European Police Office [1995] OJ C316/1. Convention establishing the European Free Trade Association, last amended on 20 September 2010. European Commission, Counterfeit and Piracy Watchlist, . Council Decision 94/800/EC of 22 December 1994 concerning the conclusion on behalf of the European Community, as regards matters within its competence, of the agreements reached in the Uruguay Round multilateral negotiations (1986–1994) [1994] OJ L336/1. Commission Decision 1999/352/EC, ECSC, Euratom of 28 April 1999 establishing the European Anti-fraud Office (OLAF), last amended by Commission Decision of 27 September 2013 [2013] OJ L257/19. Council Decision 2005/681/JHA of 20 September 2005 establishing the European Police College (CEPOL) and repealing Decision 2000/820/JHA [2005] OJ L256/63.

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NOTES Council Decision 2009/371/JHA of 6 April 2009 establishing the European Police Office (Europol) [2009] OJ L121/37. Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (Directive on electronic commerce), OJ L178/1, 17.07.2000. Directive 2001/29 of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society [2001] OJ L167/10. Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004 on the enforcement of intellectual property rights, OJ L157/45; Corrigendum OJ L195/16. Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009 on the legal protection of computer programs (codified version) [2009] OJ L111/16. Directive 2009/140/EC of the European Parliament and of the Council of 25 November 2009 amending Directives 2002/21/EC on a common regulatory framework for electronic communications networks and services, 2002/ 19/EC on access to, and interconnection of, electronic communications networks and associated facilities, and 2002/20/EC on the authorisation of electronic communications networks and services [2009] OJ L337/37. Directive (EU) 2016/943 of the European Parliament and of the Council of 8 June 2016 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure [2016] OJ L157/1. Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC [2019] OJ L130/92. Geneva Convention for the Protection of Producers of Phonograms against Unauthorised Duplication of Their Phonograms of 29 October 1971. Commission’s Green Paper of 7 June 1988 on ‘Copyright and the Challenge of Technology – Copyright Issues Requiring Immediate Action’, COM(88) 172 final. Commission’s Green Paper of 15 October 1998 ‘Combating Counterfeiting and Piracy in the Internal Market’ (COM(98) 569 final. Commission’s Green Paper of 21 April 2009 on the review of Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, COM(2009) 175 final. ‘Guidelines for States on actions to be taken vis-à-vis internet intermediaries with due regard to their roles and responsibilities’ annexed to Recommendation CM/Rec(2018)2 of 7 March 2018 of the Council of Europe’s Committee of Ministers on the roles and responsibilities of internet intermediaries. Lugano Convention of 16 September 1988 on jurisdiction and the enforcement of judgments in civil and commercial matters [1988] OJ L319/9. Commission Notice on the customs enforcement of intellectual property rights concerning goods brought into the customs territory of the Union without being released for free circulation including goods in transit [2016] OJ C244/4. Proposal for a European Parliament and Council Directive on criminal measures aimed at ensuring the enforcement of intellectual property rights and proposal for a Council Framework Decision to strengthen the criminal legal framework to combat intellectual property offences of 12 July 2005, COM(2005) 276 final; revised in 2006 as Amended proposal for a Directive of the European Parliament and of the Council on criminal measures aimed at ensuring the enforcement of intellectual property rights, COM(2006) 168 final. Proposals for a Council Decision on the conclusion of the Anti-Counterfeiting Trade Agreement between the European Union and its Member States, Australia, Canada, Japan, the Republic of Korea, the United Mexican States, the Kingdom of Morocco, New Zealand, the Republic of Singapore, the Swiss Confederation and the United States of America, COM(2011) 379 final and COM(2011) 380 final. Protocol of 16 October 2001 to the Council Act of 29 May 2000 establishing in accordance with Art. 34 of the Treaty on European Union the Convention on mutual assistance in criminal matters between the Member States of the European Union [2001] OJ C326/2. Recommendation CM/Rec(2007)16 of 7 November 2007 of the Council of Europe’s Committee of Ministers on measures to promote the public-service value of the internet. Recommendation CM/Rec(2008)6 of 28 March 2008 of the Council of Europe’s Committee of Ministers on measures to promote the respect for freedom of expression and information with regard to internet filters. European Parliament Recommendation 2009/524/EC of 26 March 2009 to the Council on strengthening security and fundamental freedoms on the Internet (2008/2160(INI)) [2010] OJ C117 E/206. Commission Recommendation of 29 June 2009 on Measures to Improve the Functioning of the Single Market [2009] OJ L176/17.

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Chapter 21 THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY Recommendation CM/Rec(2012)3 of 4 April 2012 of the Council of Europe’s Committee of Ministers on the protection of human rights with regard to search engines. Recommendation CM/Rec(2014)6 of 16 April 2014 of the Council of Europe’s Committee of Ministers on a Guide to human rights for internet users. Recommendation CM/Rec(2015)6 of 1 April 2015 of the Council of Europe’s Committee of Ministers on the free transboundary flow of information on the internet. Recommendation CM/Rec(2016)5 of 13 April 2016 of the Council of Europe’s Committee of Ministers on internet freedom. Recommendation CM/Rec(2018)2 of 7 March 2018 of the Council of Europe’s Committee of Ministers on the roles and responsibilities of internet intermediaries. Council Regulation (EC) No 515/97 of 13 March 1997 on mutual assistance between the administrative authorities of the Member States and cooperation between the latter and the Commission to ensure the correct application of the law on customs and agricultural matters [1997] OJ L82/1. Regulation (EU) No 386/2012 of the European Parliament and of the Council of 19 April 2012 on entrusting the Office for Harmonisation in the Internal Market (Trade Marks and Designs) with tasks related to the enforcement of intellectual property rights, including the assembling of public and private-sector representatives as a European Observatory on Infringements of Intellectual Property Rights [2012] OJ L129/1. Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters [2012] OJ L351/1. Regulation (EU) No 608/2013 of the European Parliament and of the Council of 12 June 2013 concerning customs enforcement of intellectual property rights and repealing Council Regulation (EC) No 1383/2003 [2013] OJ L181/15. Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council of 11 September 2013 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (EC) No 1073/1999 of the European Parliament and of the Council and Council Regulation (Euratom) No 1074/1999 [2013] OJ L248/1. Regulation (EU) No 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) [2016] OJ L119/1. Regulation (EU) No 2016/794 of the European Parliament and of the Council of 11 May 2016 on the European Union Agency for Law Enforcement Cooperation (Europol) and replacing and repealing Council Decisions 2009/371/JHA, 2009/934/JHA, 2009/935/JHA, 2009/936/JHA and 2009/968/JHA [2016] L135/53. Council Regulation (EU) No 2017/1939 of 12 October 2017 implementing enhanced cooperation on the establishment of the European Public Prosecutor’s Office (EPPO) [2017] OJ L183/1. Regulation (EU) No 2018/1727 of 14 November 2018 on the European Union Agency for Criminal Justice Cooperation (Eurojust), and replacing and repealing Council Decision 2002/187/JHA [2018] OJ L295/138. Report from the Commission to the European Parliament, the Council and the European Social Committee of 21 April 2009 on the application of Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, COM(2009) 174 final. Report from the Commission to the Council, the European Parliament and the European Social Committee of 22 December 2010 on the application of Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004 on the enforcement of intellectual property rights, COM(2010) 779 final. European Commission Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2011, . European Commission Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2012,

Report from the Commission to the European Parliament and the Council of 18 April 2013 on the functioning of the Memorandum of Understanding on the Sale of Counterfeit Goods via the Internet, COM(2013) 209 final. Report from the Commission to the Council and the European Parliament of 22 February 2018 on the implementation of the EU Customs Action Plan to combat IPR infringements for the years 2013–2017, COM(2018) 77 final. European Commission Report on EU customs enforcement of intellectual property rights. Results at the EU border – 2018, . Council Resolution of 25 September 2008 on a Comprehensive European Anti-Counterfeiting and Anti-Piracy Plan [2008] OJ C253/1.

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NOTES Council Resolution of 16 March 2009 on the EU Customs Action Plan to combat IPR infringements for the years 2009 to 2012 [2009] OJ C71/1. Council Resolution of 23 October 2009 on a reinforced strategy for customs cooperation [2009] OJ C260/1. Council Resolution of 1 March 2010 on the Enforcement of Intellectual Property Rights in the Internal Market [2010] OJ C56/1. European Parliament Resolution 2009/2178(INI) of 22 September 2010 on enforcement of intellectual property rights in the internal market [2012] OJ C50 E/48. European Parliament Resolution of 24 November 2010 on the Anti-Counterfeiting Trade Agreement (ACTA), P7 TA(2010)0432. European Parliament Resolution 2010/2156(INI) of 12 May 2011 on unlocking the potential of cultural and creative industries [2012] OJ C377 E/142. Council Resolution of 10 December 2012 on the EU Customs Action Plan to combat IPR infringements for the years 2013–2017 [2013] OJ C80/1. European Parliament Resolution of 9 June 2015 ‘Towards a renewed consensus on the enforcement of Intellectual Property Rights: An EU Action Plan’ [2016] OJ C407/03. Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations of 26 October 1961. Commission Staff Working Document of 22 December 2010 ‘Analysis of the application of Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004 on the enforcement of intellectual property rights in the Member States’, SEC(2010) 1589 final. Commission Staff Working Document of 5 February 2013 ‘Report on the protection and enforcement of intellectual property rights in third countries’, COM(2013) 30 final, 5. Commission Staff Working Document of 1 July 2014 ‘Trade, growth and intellectual property’, SWD(2014) 204 final. Commission Staff Working Document of 29 November 2017 ‘Overview of the functioning of the Memorandum of Understanding on the sale of counterfeit goods via the internet’, SDW(2017) 430 final. Commission Staff Working Document of 20 December 2019 ‘Report on the protection and enforcement of intellectual property rights in third countries’, SWD(2019) 452 final; Corrigendum of 8 January 2020, SWD(2019) 452/2 final. Statement by the Commission concerning Article 2 of Directive 2004/48/EC of the European Parliament and the Council of 29 April 2004 on the enforcement of intellectual property rights [2005] OJ L194/37. ‘Strategy for the Enforcement of Intellectual Property Rights in Third Countries’, 2004, COM(2004) 749. European Commission, ‘Synthesis of the Responses: Civil Enforcement of Intellectual Property Rights: Public Consultation on the Efficiency of Proceedings and Accessibility of Measures’, July 2013, . Treaty on the Functioning of the European Union [2010] OJ C83/47. Universal Copyright Convention (UCC) of 6 September 1952, as revised in Paris on 24 July 1971. WIPO Performances and Phonograms Treaty (WPPT), Geneva, 20 December 1996. WIPO Copyright Treaty (WCT), Geneva, 20 December 1996.

2. CJEU case law Bastei Lübbe GmbH & Co. KG v. Michael Strotzer (C-149/17), ECLI:EU:C:2018:841. Bonnier Audio AB and Others v. Perfect Communication Sweden AB (Case C-461/10), ECLI:EU:C:2012:219. Coty Germany GmbH v. Stadtsparkasse Magdeburg (C-580/13), ECLI:EU:C:2015:485. DHL Express France SA (formerly DHL International SA) v. Chronopost SA (C-235/09), ECLI:EU:C:2011:238. eDate Advertising GmbH v. X and Olivier Martinez and Robert Martinez v. MGN Limited (Joined cases C-509/09 & C-161/10), ECLI:EU:C:2011:685. Gesellschaft für Antriebstechnik GmbH & Co KG v. Lamellen und Kupplungsbau Beteiligungs KG (GAT/LuK) (C-315/01), ECLI:EU:C:2003:360. Google France and Google (C-236/08 to C-238/08), ECLI:EU:C:2010:159. Group Josi Reinsurance Company SA v. Universal General Insurance Company (UGIC) (C-412/98), ECLI:EU:C: 2000:399. IT Development SAS v. Free Mobile SAS (C-666/18), ECLI:EU:C:2019:1099. Kenny Roland Lyckeskog (C-99/00), ECLI:EU:C:2002:329.

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Chapter 21 THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY Koninklijke Philips Electronics NV v. Lucheng Meijing Industrial Company Ltd. and Others and Nokia Corporation v. Her Majesty’s Commissioners of Revenue and Customs (Joined cases C-446/09 and C-495/09), ECLI:EU:C:2011:796. Liffers v. Producciones Mandarina SL, and Mediaset España Comunicación SA (Case C-99/15), ECLI:EU:C:2016:173. L’Oréal v. eBay (C-324/09), ECLI:EU:C:2011:474. LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten v. Tele2 Telecommunication GmbH (C-557/07), ECLI:EU:C:2009:107. Mc Fadden v. Sony Music Entertainment Germany (C-484/14), ECLI:EU:C:2016:689. Netlog v. SABAM (C-360/10), ECLI:EU:C:2012:85. Pinckney v. KDG Mediatech AG (C-170/12), ECLI:EU:C:2013:635. Productores de Música de Espána (Promusicae) v. Telefónica de Espána SAU (C-275/06), ECLI:EU:C:2008:54. Realchemie Nederland BV v. Bayer CropScience AG (C-406/09), ECLI:EU:C:2011:668. Roche Nederland BV and Others v. Frederick Primus, Milton Goldenberg (Roche/Primus) (C-539/03), ECLI:EU:C: 2006:458. Scarlet Extended v. SABAM (C-70/10), ECLI:EU:C:2011:771. Simiramida-04 EOOD v. Diageo Brands BV (C-681/13), ECLI:EU:C:2015:471. Stowarzyszenie ‘Oławska Telewizja Kablowa’ v. Stowarzyszenie Filmowców Polskich (C-367/15), ECLI:EU:C:2017:36. Tommy Hilfiger Licensing LLC and Others v. Delta Center a.s (C-494/15), ECLI:EU:C:2016:528. Top Logistics & Van Caem International v. Bacardi (C-379/14), ECLI:EU:C:2015:497. United Video Properties Inc. v. Telenet NV (C-57/15), ECLI:EU:C:2016:611. UPC Telekabel Wien GmbH v. Constantin Film Verleih GmbH and Wega Filmproduktionsgesellschaft mbH (C-314/12), ECLI:EU:C:2014:192. Wintersteiger AG v. Products 4U Sondermaschinenbau GmbH (C-523/10), ECLI:EU:C:2012:220.

3. European Court of Human Rights Anheuser-Busch Inc. v. Portugal (App. No. 73049/01). Cengiz and Others v. Turkey (App. Nos 48226/10 and 14027/11). Editorial Board of Pravoye Delo and Shtekel v. Ukraine (App. No. 33014/05). K U v. Finland (App. No. 2872/02). Melnychuk v. Ukraine (App. No. 28743/03). Mouvement Raëlien Suisse v. Switzerland (App. No. 16354/06). Peta Deutschland v. Germany (App. No. 43481/09). RTBF v. Belgium (App. No. 50084/06). Szima v. Hungary (App. No. 29723/11). The Observer and The Guardian v. United Kingdom (App. No. 13585/88). Ürper and Others v. Turkey (App. Nos 14526/07, 14747/07, 15022/07, 15737/07, 36137/07, 47245/07, and 50371/07). Yildirim v. Turkey, 18 December 2012 (App. No. 3111/10).

4. Bibliography Analysis for Economic Decisions, ‘Report on the Evaluation of the Intellectual Property Rights Enforcement Strategy in Third Countries’, November 2010, . BASCAP, ‘Building a Digital Economy: The Importance of Saving Jobs in the EU’s Creative Industries’, 2010, . BASCAP, ‘Estimating the global economic and social impacts of counterfeiting and piracy’, 2011, . Bian, X. and Moutinho L., ‘An investigation of determinants of counterfeit purchase consideration’ (2009) Journal of Business Research 62, 368–78. Business Software Alliance (BSA), Piracy Impact Study: The Economic Benefits of Reducing Software Piracy, 2010, . Centre for Economics and Business Research, Counting Counterfeits: Defining a Method to Collect, Analyze and Compare Data on Counterfeiting and Piracy in the Single Market, 2002, . Electronic Frontier Foundation, ‘Canada-EU Trade Agreement Replicates ACTA’s Notorious Copyright Provisions’, 2012, . European Data Protection Supervisor, Opinion of 24 April 2012 on the proposal for a Council Decision on the Conclusion of the Anti-Counterfeiting Trade Agreement between the European Union and its Member States,

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NOTES Australia, Canada, Japan, the Republic of Korea, the United Mexican States, the Kingdom of Morocco, New Zealand, the Republic of Singapore, the Swiss Confederation and the United States of America’, . European Data Protection Supervisor, Comments of 13 September 2012 on DG MARKT’s public consultation on procedures for notifying and acting on illegal content hosted by online intermediaries, . EUIPO, Corrective Measures, report drafted by the Sub-Group on Legal Framework of the European Observatory on Counterfeiting and Piracy, 2010, . EUIPO, Damages, report drafted by the Sub-Group on Legal Framework of the European Observatory on Counterfeiting and Piracy, 2010, ; updated in 2014, . EUIPO, Digital advertising on suspected infringing websites, 2016, . EUIPO, The Economic Cost of IPR Infringement in the Recorded Music Industry, 2016, . EUIPO, European Citizens and Intellectual Property: Perception, Awareness and Behaviour, 2013, ; updated in 2017 (). EUIPO, Evidence, report drafted by the Sub-Group on Legal Framework of the European Observatory on Counterfeiting and Piracy, 2010, . EUIPO, Illegal IPTV in the European Union, 2019, . EUIPO, Injunctions, report drafted by the Sub-Group on Legal Framework of the European Observatory on Counterfeiting and Piracy, 2010, . EUIPO-EPO, IPR-intensive industries and economic performance in the European Union. Industry-Level Analysis Report, 2013, ; updated in 2017 ( and 2019 (). EUIPO, Online Copyright Infringement in the European Union, 2019, . EUIPO, Report on the EU Enforcement of Intellectual Property Rights: Results at the EU Borders and in Member States 2013–2017, 2019, EUIPO, 2019 Status Report on IPR Infringement, 2019, . EUIPO, Synthesis Report on IPR Infringement 2018, 2018, . Europol & EUIPO, Intellectual Property Crime Threat Assessment 2019, 2019, .

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Chapter 21 THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY Europol & EUIPO, 2015 Situation Report on Counterfeiting in the European Union, 2015, . Europol & EUIPO, 2017 Situation Report on Counterfeiting and Piracy in the European Union, . Europol, SOCTA 2017: EU Serious and organised crime threat assessment, 2017, . Fontanaud, D., ‘Counterfeiting and Piracy: towards European criminal legislation to combat the penetration of organized crime’, (2005) The European Files 20. Fossoul, V., ‘The right of information: an illustration of the conflict between data protection and the enforcement of intellectual property rights’, (2013) BMM Bulletin 1, 11. G8, ‘Growth and Responsibility in the World Economy’, 2007, . G8, ‘Reducing IPR Counterfeiting and Piracy through effective enforcement’, 2005, . Geiger, C., Droit d’auteur et droit du public à l’information. Approche de droit comparé, Litec, Paris, 2004. Geiger C. and Izyumenko, E., ‘Freedom of expression as an external limitation to copyright law in the EU: the Advocate General of the CJEU shows the way’, (2019) European Intellectual Property Review 41(3), 131–7. Geist, M., ‘ACTA Lives: How the EU and Canada are using CETA as backdoor mechanism to revive ACTA’, (9 July 2012). Geist, M., ‘Beyond ACTA: Proposed EU-Canada trade agreement intellectual property chapter leaks’, (16 December 2009). Gervais, D., ‘The international legal framework of border measures in the fight against counterfeiting and piracy’, in Vrins, O. and Schneider M. (eds), Enforcement of Intellectual Property Rights through Border Measures. Law and Practice in the EU, 2nd ed., Oxford University Press, Oxford, 2012. Godart, B., ‘The involvement of organized crime in intellectual property rights infringements’, in Vrins, O. and Schneider, M. (eds), Enforcement of Intellectual Property Rights through Border Measures. Law and Practice in the EU, 2nd ed., Oxford University Press, Oxford, 2012. Hilty, R., Kur, A. and Peukert, A., ‘Stellungnahme des Max-Planck-Instituts für Geistiges Eigentum, Wettbewerbsund Steuerrecht zum Vorschlag für eine Richtlinie des Europäischen Parlaments und des Rates über strafrechtliche Maßnahmen zur Durchsetzung der Rechte des geistigen Eigentums, KOM(2006) 168 endgültig’ (2006) GRUR Int 722. Hugenholtz, P.B., ‘Copyright and freedom of expression in Europe’, in Dreyfus, R.C., Zimmerman, D.L., and First, H. (eds), Expanding the Boundaries of Intellectual Property, Oxford University Press, Oxford, 2001. Hunton & Williams, ‘Study on Online Copyright Enforcement and Data Protection in Selected Member States’, Brussels, April 2010, . Husovec, M., ‘Injunctions against Innocent Third Parties: The Case of Website Blocking’, (2012) JIPITEC 116. Ilias, S., The Proposed Anti-Counterfeiting Trade Agreement: Background and Key Issues, Congressional Research Service, Washington, DC, 2010. Ilias, S. and Fergusson, I., Intellectual Property Rights and International Trade, Congressional Research Service, Washington, DC, 2009. Izyumenko, E., ‘The Freedom of Expression Contours of Copyright in the Digital Era: A European Perspective’, (2016) The Journal of World Intellectual Property 3–4, 115–30. Jaeger, T., ‘IP Enforcement Provisions in EU Economic Partnership Agreements’ in: J. Drexl, H. Grosse Ruse-Khan and S. Nadde-Phlix (eds), EU Bilateral Trade Agreements: For Better or Worse?, MPI Studies on Intellectual Property and Competition Law, Vol. 20, Springer, 2014. Jutte, B.J., ‘The beginning of a (happy?) relationship: copyright and freedom of expression in Europe’, (2016) European Intellectual Property Review 38(1), 11–22. Kamperman Sanders, A., Shabalala, D.B., Moerland, A., Pugatch M. and Vergano, P., ‘The Anti-Counterfeiting Trade Agreement ACTA: An Assessment’, 2011, . Korff, D. and Brown, I., ‘Opinion on the compatibility of the Anti-Counterfeiting Trade Agreement (ACTA) with the European Convention on Human Rights and the EU Charter of Fundamental Rights’, .

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NOTES Lory, B. and Hecˇko Z., ‘EU law and policies on intellectual property rights enforcement’, in Vrins, O. and Schneider M. (eds), Enforcement of Intellectual Property Rights through Border Measures. Law and Practice in the EU, 2nd ed., Oxford University Press, Oxford, 2012. Lowe, P., ‘Counterfeiting: links to organized crime and terrorist funding’, (2006) J Financial Crime 13, 255. Mendis, S., Copyright, the Freedom of Expression and the Right to Information – Exploring a Potential Public Interest Exception to Copyright in Europe, Nomos, Baden, 2011. Moody, G., ‘ACTA’s back: European Commission trying to sneak in worst parts using Canada-EU trade agreement as a Trojan Horse’, (9 July 2012). O’Byrne, O. and Burstall, R., ‘Liability of landlords for infringing activities’, (2011) JIPLP 6, 738. OECD, The Economic Consequences of Counterfeiting, Paris, 1998, . OECD, The Economic Impact of Counterfeiting and Piracy, Paris, 2008, . OECD, Governance Frameworks to Counter Illicit Trade, 2018, . OECD, The Impact of Trade-Related Intellectual Property Rights on Trade and Foreign Direct Investment in Developing Countries, Paris, 2003, . OECD, Magnitude of Counterfeiting and Piracy of Tangible Products. An update, Paris, 2009, . OECD, Recommendation on Countering Illicit Trade: Enhancing Transparency in Free Trade Zones, 2019, . OECD-EUIPO, Trends in Trade in Counterfeit and Pirated Goods, Paris, 2019, . Pechan, L. and Schneider, M., ‘Carriers and trade mark infringements: should carriers care?’ (2010) 5 JIPLP 350. Petersen-Padberg, A., ‘Regulation (EU) No 608/2013’, in Cottier, T. and Veron P. (eds), Concise International and European IP Law, 3rd ed., Kluwer, 2014. Phillips, T. Knockoff: The Deadly Trade in Counterfeit Goods, Kogan Page, 2005. RAND, ‘Measuring IPR infringements in the internal market’, 2012, . Roffe, P. and Seuba, X., The ACTA and the Plurilateral Enforcement Agenda: Genesis and Aftermath, Cambridge University Press, 2014. Saviano, R., Gomorrah: Dans l’empire de la Camorra, Gallimard, Paris, 2007. Schneider, M. and Vrins O., ‘The magnitude and the economic and social consequences of counterfeiting and piracy’, in Vrins, O. and Schneider M. (eds), Enforcement of Intellectual Property Rights through Border Measures. Law and Practice in the EU, 2nd ed., Oxford University Press, Oxford, 2012. Schneider, M. and Vrins O., ‘Regulation 1383/2003’, in Vrins, O. and Schneider, M., Enforcement of Intellectual Property Rights through Border Measures. Law and Practice in the EU, 2nd ed., Oxford University Press, Oxford, 2012. Schneider, M. and Vrins O., ‘The EU offensive against IP offences: should right-holders be offended?’, (2006) JIPLP 173–5. Seuba, X., The Global Regime for the Enforcement of Intellectual Property Rights, Cambridge University Press, 2017. Stamatoudi, I., ‘Data protection, secrecy of communications and copyright protection. Conflicts and convergences. The example of Promusicae v. Telefonica ’, in Stamatoudi, I. (ed), Copyright Enforcement and the Internet, Information Law Series, Kluwer Law International, Alphen aan den Rijn, 2010. Strowel, A. and Tulkens, F., ‘Freedom of expression and copyright under civil law: of balance, adaptation and access’, in Griffiths, J. and Suthersanen U. (eds), Copyright and Free Speech. Comparative and International Analyses, Oxford University Press, Oxford, 2005. Taylor, M.D., ‘The global system of copyright enforcement: Regulations, policies and politics’, in Stamatoudi, I. (ed.), Copyright Enforcement and the Internet, Wolters Kluwer Law and Business Series, Alphen aan den Rijn, 2010. Torremans, P.L.C. (ed.), Copyright and Human Rights. Freedom of Expression – Intellectual Property – Piracy, Kluwer Law International, Information Law Series, The Hague/London/New York, 2004. Treverton. G.F. et al, Film, Piracy, Organized Crime, and Terrorism, 2009, . Union des Fabricants, Rapport Contrefaçon et Criminalité Organisée, 3rd ed., 2005. United Nations Conference on Trade and Development, Intellectual Property Provisions in International Investment Arrangements, United Nations, New York: 2007.

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Chapter 21 THE EU POLICIES AND ACTIONS IN THE FIGHT AGAINST PIRACY United Nations Economic and Social Council, Report of the United Nations Interregional Crime and Justice Research Institute, 26 March 2019, E/cn.15/2019/8, . United Nations Economic and Social Council, Works of the United Nations Interregional Crime and Justice Research Institute, 2016, E/cn.15/2016/8, . US Customs and Border Protection Office of Trade, ‘Intellectual Property Rights Fiscal Year 2018 Seizure Statistics’, 2019, . von Welser, M. and Gonzales, A., Marken- und Produktpiraterie: Strategien und Lösungsänsatze zu ihrer Bekämpfung, Wiley-VCH, 2007. Vrins, O., ‘The European Commission’s proposal for a regulation concerning Customs enforcement of IP rights’, (2011) JIPLP 6, 774. Vrins, O. and Schneider, M. (eds), Enforcement of Intellectual Property Rights through Border Measures. Law and Practice in the EU, 2nd ed., Oxford University Press, Oxford, 2012. Vrins, O., ‘The impact of ACTA on the EU acquis and civil liberties’, European Parliament, Directorate-General for external policies of the Union, The Anti-Counterfeiting Trade Agreement (ACTA), March 2012, n° 66. Vrins, O., Regulation (EU) No 608/2013 of 12 June 2013 Concerning Customs Enforcement of Intellectual Property Rights and Repealing Regulation 1383/2003, Kluwer, International Encyclopaedia of Laws (IEL), Intellectual Property series, 2017. Weatherall, K., ‘ACTA April 2010 – analysis of provisions’, in The Selected Works of Kimberlee Weatherall, 2010, . Weatherall, K., ‘Intellectual property in ACTA and the TPP: Lessons not learned’, , 2011. Weatherall, K., ‘Politics, compromise, text and the failures of the Anti-Counterfeiting Trade Agreement ’, (2011) Sydney Law Review 33(2), 229. World Customs Organization, Illicit Trade Report 2018, 2019, . World Customs Organization, Annual Report 2018-2019, 2020, . Yu, P.K., ‘TRIPS and its Achilles’ Heel’, (2011) J Intellectual Property Law 18, 479.

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22 BRINGING EUROPE’S CULTURAL HERITAGE ONLINE: INITIATIVES AND CHALLENGES Nadine Klass, Hajo Rupp and Julia Wildgans

I.

THE ROLE OF CULTURE IN THE DIGITAL AGE 22.01

II. DIGITISATION AND PRESERVATION OF EUROPE’S CULTURAL MEMORY: A KEY ASPECT OF THE EU INFORMATION POLICY 1. Digitisation of cultural heritage: aims and benefits A. The meaning of digitisation B. Unimpeded access to cultural heritage C. Re-use D. Economic benefits 2. Preserving cultural heritage III. THE LAUNCH OF EUROPEANA AND OTHER EUROPEAN ACTIONS AND INITIATIVES ON THE DIGITISATION, ONLINE ACCESSIBILITY AND PRESERVATION OF EUROPEAN CULTURAL MATERIAL 1. Europe’s digital agenda so far 2. Europe’s cultural heritage for all: the launch of Europeana A. Europeana and its role in the digitisation process B. Objectives: The strategic plan 2011–2015, the Europeana Strategy 2015–2020 and the Europeana Strategy 2020–2025 C. Organisation D. Users E. Europeana as a means to drive innovation and a tool to preserve the cultural heritage

22.07 22.07 22.07 22.09 22.13 22.15 22.17

22.22 22.22 22.28 22.28

22.34 22.41 22.45

IV. DIGITISATION AND COPYRIGHT LAW: A TENSION WITH CONSEQUENCES 1. Digitisation of public domain content A. The public domain B. The (re-)privatisation of the public domain 2. The digitisation of copyrighted material as a special challenge A. Economic rights B. Moral rights V. THE ORPHAN WORKS ISSUE 1. Cost and time-consuming rights clearance as an obstacle to digitisation and preservation 2. Directive 2012/28/EU of 25 October 2012 on certain permitted uses of orphan works 3. ARROW: Accessible Registries of Rights Information and Orphan Works

22.50 22.50 22.50 22.54 22.62 22.64 22.72 22.78

22.78

22.83 22.90

VI. THE LEGAL CHALLENGE: FINDING THE RIGHT BALANCE IN THE DIGITAL AGE 1. Tensions between creators, intermediaries and the public: an interest analysis A. Interests of creators B. Intermediaries C. Public/users 2. Interest implications

22.102 22.102 22.109 22.112 22.115

VII. POLICY CONCLUSION

22.116

22.98

22.48

I. THE ROLE OF CULTURE IN THE DIGITAL AGE Culture lies at the heart of human development and civilisation. Culture is what makes people hope and dream, by stimulating our senses and offering new ways of looking at reality. It is what brings people together, by stirring dialogue and arousing passions, in a way that unites rather than divides. Culture should be regarded as a set of distinctive spiritual and material traits that

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Chapter 22 BRINGING EUROPE’S CULTURAL HERITAGE ONLINE: INITIATIVES AND CHALLENGES characterize a society and social group. It embraces literature and arts as well as ways of life, value systems, traditions and beliefs.1

22.01 Even though the European Union (EU) is characterised by linguistic and also cultural diversity, Europeans also share a large common cultural heritage. 22.02 ‘Culture’, as a term or concept, is recognised as very hard to define.2 It is a sphere of intellectual expression and comprises not only material culture, but also values, ideas and beliefs.3 Culture, thus, also has a non-material, intangible and communicative dimension. Culture as a root for European cultural heritage legislation and policy regarding digitisation can be broken down into art, including works of literature, music or architecture, science and education.4 As such, it plays an essential role in human development. 22.03 Cultural heritage is a valuable asset in the knowledge-based world, an important resource for the European culture industry and a catalyst for creativity, as well as an important driver of growth and the creation of jobs.5 Supporting and promoting culture serves as a signal for prosperity and economic competence leading to further investments and international cooperation.6 Therefore, it is not surprising that the European Commission has emphasised already in its ‘European agenda for culture in a globalizing world’, which was adopted in 2007, that ‘creative entrepreneurship and a vibrant cultural industry are a unique source of innovation for the future’,7 and that ‘culture is an indispensable feature to achieve the EU’s strategic objectives of prosperity, solidarity and security, while ensuring a stronger presence in the international scene’.8 22.04 Access to information and to cultural goods as well as the preservation of the existing cultural heritage becomes increasingly important in the digital age. A growing number of people use the digital resources available via the internet as their main source of information, entertainment, education, and for research purposes. That is why cultural institutions, especially those such as libraries, archives and museums, strive to digitise their collections not only for the purpose of preservation, but also to make Europe’s and the world’s heritage available to the public in a way that is keeping pace with the rapidly evolving digital world. The vision of a single library, a single access point, for universal wisdom and knowledge is intriguing and seems within reach.9 Besides, it is widely acknowledged that mass digitisation and dissemination of works are a means of protecting Europe’s cultural heritage in an efficient and sustainable way.10

1 2

3 4 5 6 7 8

9

10

COM (2007) 242 final on European agenda. J. Blake, ‘On defining cultural heritage’, (2000) International and Comparative Law Quarterly, 49, 61, 67; Recommendation of 27 October 2011 on the digitisation and online accessibility of cultural material and digital preservation (REC 2011/711). Blake, 68. As such, cultural heritage in its political dimension is a more limited category than culture, and the concept of culture in other disciplines at law is, of course, broader and more complex in nature, see Blake, 67. COM (2007) 242 final on European agenda. See in this context, the considerations of R. Bliege Bird and E. Smith, ‘Signaling theory, strategic interaction, and symbolic capital’, (2005) Current Anthropology, 46, 221, 222. COM (2007) 242 final on European agenda. Ibid. Against this background, the Agenda formulates three strategic objectives: First, to promote cultural diversity and intercultural dialogue, second, to foster culture as a catalyst for creativity for jobs and growth, and, third, to promote the vital role of culture in international relations. See in this context G. Frosio, ‘Communia and the European public domain project: A politics of the public domain’, in M. Dulong de Rosnay and J.C. de Martin (eds), The Digital Public Domain. Foundations for an Open Culture, Open Book Publishers, Cambridge, 2012, 82: ‘Today the entire collection of human knowledge may be only one click away.’ Dir. 2012/28 on certain permitted uses of orphan works at recital 5.

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II. DIGITISATION AND PRESERVATION OF EUROPE’S CULTURAL MEMORY

Facilitating access to knowledge and information for consumers, researchers and the broader public, 22.05 the use of new technologies by people with disabilities, flexibility for the dissemination of teaching material – these are only a few aspects symbolising the aims and benefits of the digitisation of cultural heritage. In addition, digitisation also has economic relevance – since it also promotes free movement of information, creativity and innovation. Protecting European cultural heritage and facilitating access in the interests of the European citizens as the main beneficiaries of a broad cultural landscape and diversity is, therefore, of utmost importance.11 For those reasons,12 the support for digitisation and the online access to cultural material and its 22.06 digital preservation have been moved into the focus of the European Commission and the Member States.13

II. DIGITISATION AND PRESERVATION OF EUROPE’S CULTURAL MEMORY: A KEY ASPECT OF THE EU INFORMATION POLICY Digitisation and online accessibility are essential ways to highlight cultural and scientific heritage, to inspire the creation of new content and to encourage new online services to emerge. They help to democratise access and to develop the information society and the knowledge-based economy.14

1. Digitisation of cultural heritage: aims and benefits A. The meaning of digitisation Digitisation describes the process of converting analogue information, regardless of its form, into 22.07 digital information/signals with the help of suitable electronic devices, in order to gain information that can be stored, processed or transmitted through digital circuits and networks.15 From the perspective of cultural heritage institutions, the transformation of tangible cultural objects into digital signals allows for the storage of the cultural information in a durable, ubiquitous and extensive way. Even though digitisation raises a lot of technical, legal, financial, and organisational issues, it opens 22.08 up new opportunities for the communication of cultural heritage. The development of digital libraries and the support of other cultural institutions and repositories in the process of digitisation have a great potential for civilisation.

‘Culture’ is generally recognised as complex to define. It can refer to the fine arts, including a variety of works of art, cultural goods and services. ‘Culture’ also has an anthropological meaning. It is the basis for a symbolic world of meanings, beliefs, values, traditions which are expressed in language, art, religion and myths. As such, it plays a fundamental role in human development and in the complex fabric of the identities and habits of individuals and communities, COM (2007) 242 final on European agenda. 11 12

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COM (2007) 242 final on European agenda. At the same time, the efforts reflect the political conviction that control over national and international cultural heritage should not be left to private companies, see in this context, and regarding the intended actions of the European Commission: Citizens’ Summary: Communication on Copyright in the Knowledge Economy, European Commission, 19 October 2009; https://op.europa.eu/s/n6AT last accessed 18 May 2020. See, for example COM (2010) 2020 final. European Council of Ministers on the launch of the Europeana prototype, Brussels, 20 November 2008. A. Lucas-Schloetter, ‘Digital libraries and copyright issues: Digitization of contents and the economic rights of the authors’, in I. Iglezakis, T-E. Synodinou and S. Kapidakis (eds), E-Publishing and Digital Libraries: Legal and Organizational Issues, Information Science Reference, Hershey & New York, 2011, 160.

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B. Unimpeded access to cultural heritage 22.09 Digitisation also extends opportunities for unimpeded access concerning the communication and dissemination of cultural heritage. Hitherto, cultural artefacts, to a large degree, were communicated in a localised manner, that is to say they were tied to a specific place.16 So-called cultural heritage institutions, such as libraries, museums and archives, are concerned with establishing, preserving and mediating a collection of cultural items.17 Each of these activities is significantly facilitated by information technology. 22.10 The most obvious and most important point regarding the digitisation of collections is of a quantitative nature: Digital copies of cultural objects are accessible via the internet by a growing number of users, actually only limited by the capacity of the particular server on which the content is stored.18 While traditional forms of access are limited to the cultural heritage institutions’ local conditions, digitised content is available to nearly everyone, in principle, with access to sufficient technical equipment. 22.11 Furthermore, digital copies of cultural artefacts retrievable from institutions’ web pages have time-related benefits. On the one hand, interested parties are able to consult the files around the clock.19 Thus, the period for reception of and interaction with the content is lengthened. On the other hand, the actual time needed to access the content is reduced due to digitisation. As interested individuals do not have to physically access buildings and sites, less time needs to be spent on the reception of cultural contents – leading to more convenient cultural interaction.20 The flexibility of cultural mediation is increased by long-distance access. In other words, contents are available at the very moment they are requested. 22.12 Even though – in some circumstances – digital copies cannot match the nature (e.g. the haptics) of the original expression, access to cultural content is facilitated in a qualitative way as well. Interested parties are able to view works in a manner impossible when reviewing the original. Threedimensional or zoomable digital images, for example, may reveal other insights than those observable in reality.21

C. Re-use 22.13 Depending on the actual conditions of access, cultural objects being available in digital form may also trigger creative re-use. First, users are enabled to combine different forms of content in the digital world; for example, moving images can easily be matched to music by the use of digital editing software.22 Thereby, both new content and entirely new creative procedures are being

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E. Euler, Das kulturelle Gedächtnis im Zeitalter digitaler und vernetzter Medien und sein Recht, Bock & Herchen, Bad Honnef, 2011, 52. Dreier et al., ‘Museen, Bibliotheken und Archive in der Europäischen Union’, (2012) Zeitschrift für Urheber- und Medienrecht (ZUM), 56, 273; J. Becker, Die Digitalisierung von Medien und Kultur, Springer, Wiesbaden, 2013, 239. However, legal or technical measures might further limit access to the content, see infra IV.1.B. In contrast, conventional memory institutions’ main ways to make content available are exhibitions, catalogues and loans, see Dreier et al., 273. As these services need (costly) manpower for preparation, realisation and supervision, the institutions’ sites have to close at less frequented times (i.e. at night). See J. Trant, ‘Exploring new models for administering intellectual property: The Museum Educational Site Licensing Project, available from: https://www.ideals.illinois.edu/handle/2142/25942 (last accessed 18 May 2020), 34, illustrating the time-related benefits of digitisation for research and education. See H.S.B. Abdul Karim, ‘Digitisation of cultural heritage information: Requirements for building a digital library,’ INFLIBNET’s Convention Proceedings, Caliber 2004: New Delhi 241, available from: http://ir.inflibnet.ac.in/handle/ 1944/340 (last accessed 18 May 2020), 244, concerning improved legibility and searchability of digital contents. U. Gasser and S.Ernst, ‘From Shakespeare to DJ Danger Mouse: A quick look at copyright and user creativity in the digital age’, The Berkman Center for Internet & Society at Harvard Law School Research Publication No. 2006–05, available from http://ssrn.com/abstract=909223 (last accessed 18 May 2020), 5.

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developed and tested. Computer technology also provides the opportunities to deconstruct contents. Digital copies of pre-existing objects split into their components can be altered and re-arranged, generating a new process to innovative cultural expression – one prominent example being remixes of music.23 Furthermore, at times, only digitisation is able to establish links between previously dispersed 22.14 cultural objects. Once digitised, the objects can be appreciated simultaneously, creating new opportunities for comparison and recombination.24

D. Economic benefits Finally, digitisation of cultural heritage provides economic benefits.25 On the one hand, this is due 22.15 to technical conditions. The scope and speed of digitisation depend on technical viability. The creation of digital copies of cultural objects requires reliable instruments. Digitisation offers opportunities for technology businesses to innovate and market new products and, therefore, contributes to increased employment levels and economic growth.26 On the other hand, the cultural content itself is a resource for multiple products. The tourism industry can capitalise on digitised cultural heritage by using the contents, e.g. for marketing purposes.27 Finally, the innovative content resulting from the re-use of digitised cultural heritage can be utilised 22.16 as a commodity. The cultural and creative industries both participate in cultural development and make use of pre-existing culture. Above all, however, they create goods which are being offered, contributing to the economic output.28 Thus, they are part of the economic process, just as the technology and tourism businesses mentioned above.29 All in all, digitisation extends the availability of resources for cultural companies, fosters re-use and offers new cultural products, which can be introduced into the economic cycle.

2. Preserving cultural heritage Although the term ‘preservation’ has different meanings, it generally refers to activities undertaken 22.17 in order to prevent the deterioration of a work, document or artefact, and thereby to ensure its usability.30 Preservation measures may also include actions taken to guarantee the long-term availability of information and content stored in fragile or rare documents or artefacts, for example the creation of surrogates or the provision of appropriate environmental conditions.31

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See Frosio, 16. Karim, 244. These benefits are often broadly referred to as culture adding value to the economic system, Becker, 245; see, for example REC 2006/585 at recital 1. E. Niggemann, J. De Decker and M. Lévy (Comité des Sages), The New Renaissance, European Commission, 2011, 33. Ibid., 33; see B. McKercher and H. du Cros, B, Cultural Tourism: The Partnership Between Tourism and Cultural Heritage Management, The Haworth Press, Binghampton 2002, 200–4, investigating the overall benefits of marketing strategies in cultural tourism. See D. Throsby, ‘Why should economists be interested in cultural policy?’, (2012) The Economic Record, 88, 106, 108. However, pure cultural products have to be distinguished from mere utilitarian technical goods because of their intellectual nature, see further D. Power and A.J. Scott, ‘A prelude to cultural industries and the production of culture’, in D. Power and A.J Scott (eds), Cultural Industries and the Production of Culture, Routledge, London and New York, 2004, 3–4. Besek et al., ‘International study on the impact of copyright law on digital preservation’, available from: http:// www.digitalpreservation.gov/documents/digital_preservation_final_report2008.pdf (last accessed 18 May 2020), 4. Besek et al., 4.

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22.18 However, preservation activities in the digital age have not only acquired a broader meaning, but also a greater importance. The preservation of cultural heritage by the use of digital storage facilities is beneficial and necessary in several respects. Storing creative works as digital file formats prevents the works from getting lost due to their material fixation being exposed to decay hazards. Making several copies in case of disaster scenarios and for security reasons is, therefore, common and necessary.32 Books, for example, might get destroyed by environmental influences over the years, but scanning the pages prevents the intellectual work (the actual content) from vanishing. 22.19 However, not all categories of works can be appropriately represented by digital means.33 Nonetheless, digitisation provides the opportunity to create an image of the cultural object, allowing it to be viewed (on-screen) and printed.34 The digital image exists alongside the original object, but may outlive the original. 22.20 Digital works themselves do, however, present a specific challenge to preservation due to rapid technical changes and other specifics.35 Technological obsolescence especially endangers the use of digital cultural heritage, since the function of digital objects is closely linked to specific hard and software environments.36 This might require the migration of information to new technologies. Furthermore, digital material is not stable for long periods, but it ‘ages’ rapidly, requiring regular intervention calling for preservation activities beginning at or soon after production or acquisition.37 However, such problems arise from organisational issues, not from the data themselves. Cultural heritage institutions upgrading their hardware to the state-of-the-art have to safeguard that the data are migrated, in case of need, by transforming them into different file formats.38 If these standards are met, digitisation features prominently in preserving cultural heritage. 22.21 Besides these aspects relating to the physical evanescence of cultural objects, digitisation also ensures that artefacts constituting cultural heritage are present in the virtual sphere. Today, much of the public discourse is being transferred to the internet because communication of political and social debate is facilitated enormously by the independence of the participant’s location.39 In order to guarantee culture’s ongoing contribution to the social and political discourse online, objects have to be brought into the virtual sphere.40 In this regard, digitisation also preserves cultural objects from loss of societal importance. Digitisation and online accessibility are, therefore, essential means to highlight cultural and scientific heritage as they have increasingly moved into the focus on a European level.

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Besek et al., 5. Three-dimensional cultural objects, for example, are more difficult to digitise, see Pavlidis et al., ‘Methods for 3D digitization of cultural heritage’, (2007) Journal of Cultural Heritage, 8, 93, 94–6. Nowadays it is even possible and quite affordable for everyone to print objects in three-dimensional form via 3D printing techniques. See H. Dekeyser and T. Lipinski, ‘Digital archiving and copyright law: A comparative analysis’, (2008) International Journal of Communications Law and Policy, 12, 179, 182, stating that: ‘The duration of copyright protection far outweighs the life expectancy of any digital technology’, why archives need to migrate content from one generation to the other. Niggemann, De Decker and Lévy (Comité des Sages), 26; Besek et al., 5. Ibid. Dreier et al., 276. See Z. Papacharissi, ‘The virtual sphere. The internet as a public sphere’, (2002) New Media & Society, 9, 23, concerning the opportunities of online public debating. See also Niggemann, De Decker and Lévy (Comité des Sages), 9, stating that ‘[i]n a time when more and more cultural goods are consumed online, when screens and digital devices are becoming ubiquitous, it is crucial to bring culture online’; Klass and Rupp, 763.

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III. THE LAUNCH OF EUROPEANA AND OTHER EUROPEAN ACTIONS AND INITIATIVES ON THE DIGITISATION, ONLINE ACCESSIBILITY AND PRESERVATION OF EUROPEAN CULTURAL MATERIAL 1. Europe’s digital agenda so far Large-scale digitisation of Europe’s cultural heritage, the necessary measures to facilitate the process 22.22 of digitisation, and also the promotion of cultural diversity and creative content in general, are, among other issues, key aspects of the Europe 2020 strategy that was launched in March 2010 by the European Commission.41 They are also pillars of the Digital Agenda of the European Union,42 which is Europe’s policy for a successful digital economy and ‘one of the seven flagship initiatives’43 of the Europe 2020 strategy. The importance of these aspects was subsequently also recognised by the EU in its ‘European Framework for Action on Cultural Heritage’ 2019.44 Even before these initiatives, the European Commission had already made digital libraries a priority 22.23 in the i2010 European Libraries Initiative45 in September 2005, in which a strategy for the digitisation and preservation of Europe’s cultural heritage had been developed. To deal with the legal, organisational and economic issues raised by the i2010 strategy, the EU 22.24 Commission furthermore published several recommendations46 and communications47 and set up a High Level Expert Group (‘HLEG’) on Digital Libraries48 in order to support the protagonists and give advice on the digitisation process.49 These activities, especially the European Digital Libraries Initiative, have also been strongly supported by the European Parliament50 and the Council.51 Furthermore, the Commission issued a Green Paper on Copyright in the Knowledge Economy in 22.25 2008 with the declared purpose ‘to foster a debate on how knowledge for research, science and education can best be disseminated in the online environment’.52 The topic of digitisation and online accessibility has been in the focus of European institutions also in subsequent years. In 2011, for example, the Commission issued a recommendation on the digitisation and online accessibility

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See COM (2010) 2020 final on Europe 2020. See COM (2010) 245 final/2 on Digital Agenda. See ibid, 3. See https://ec.europa.eu/culture/content/european-framework-action-cultural-heritage_en last accessed 21 April 2020. COM (2005) 465 final on ‘i2010: Digital Libraries’. See, for example: Recommendation of 24 August 2006 on the digitisation and online accessibility of cultural material and digital preservation, (REC 2006/585); Recommendation of 27 October 2011 on the digitisation and online accessibility of cultural material and digital preservation (REC 2011/711). COM (2007) 56 final on scientific information in the digital age; COM (2007) 242 final on European agenda; COM (2008) 513 final: Europe’s cultural heritage at the click of a mouse; COM (2009) 440 final Europeana; COM (2009) 532 final on knowledge economy; COM (2010) 2020 final on Europe 2020; COM (2010) 245 final on Digital Agenda for Europe; COM (2010) 245 final/2 on Digital Agenda for Europe. See in this context High Level Expert Group, i2010: Final report on public private partnership for the digitisation and online accessibility of Europe’s cultural heritage. See T. Koskinen-Olsson, ‘Digital libraries: Collective administration for online libraries – a rightholders’ dream or an outdated illusion?’ in L. Bently, U. Suthersanen and P.L.C. Torremans, Global Copyright: Three Hundred Years Since the Statute of Anne, from 1709 to Cyberspace, Edward Elgar Publishing, Cheltenham, UK and Northampton, MA, USA, 2010, 253–5, who is reviewing the European initiatives in this area in detail. Res. 9/2007 on i2010: towards a European digital library. See, for example, Council Concl. on the Digitisation and Online Accessibility of Cultural Material and Digital Preservation; Council Concl. on Europeana: next steps. Green Paper, Copyright in the Knowledge Economy, COM (2008) 466 final, No. 1.1.

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Chapter 22 BRINGING EUROPE’S CULTURAL HERITAGE ONLINE: INITIATIVES AND CHALLENGES

of cultural material.53 Furthermore, the Comité des Sages, a high-level reflecting group, published a report on the digitisation of Europe’s cultural heritage that urges the Member States to increase their efforts to put the large collections held in the national libraries, archives and museums online, pointing not only at the social, but also at the economic benefit of digitisation.54 Subsequently, cooperation between EU Member States has been increased, most recently in 2019, when 27 countries agreed to work more closely together on digitising cultural heritage.55 22.26 Another aspect in the continuing efforts to support the digitisation process has been the harmonisation of the laws of the Member States, because different approaches and legal treatment have been seen as an obstacle to the promotion of easy access to and the free movement of knowledge.56 Copyright law, for example, is not consistent at all across Europe and rights clearance, particularly, can be complex, especially regarding works involving multiple right holders or very old works.57 It is not at all unusual that the costs for rights clearance, especially in cases where multiple territories and right holders are involved, are several times higher than the digitisation costs.58 The time factor can also be of significance and can have negative effects for large-scale digitisation projects. 22.27 For those reasons, the European institutions have shown a particular interest in orphan works, recognising that a potential loss of social and economic value is to be feared without practical solutions to the orphan works59 issue. That is why, following a proposal of the European Commission for an Orphan Works Directive,60 the European Parliament and the Council of the European Union adopted the Directive 2012/28/EU in October 2012 on certain permitted uses of orphan works.61

2. Europe’s cultural heritage for all: the launch of Europeana A. Europeana and its role in the digitisation process 22.28 Besides the digital initiatives mentioned62 above, the several soft law instruments and the Orphan Works Directive,63 which all aim to make Europe’s cultural and scientific resources available to the broader public, action has also been taken regarding the plan to digitise books on a large scale. As part of the i2010 strategy, the European Digital Library Europeana,64 a European digital library 53 54 55 56

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REC 2011/711 on digitisation and online accessibility. Niggemann, De Decker and Lévy (Comité des Sages). See https://ec.europa.eu/digital-single-market/en/news/eu-member-states-sign-cooperate-digitising-cultural-heritage last accessed 21 April 2020. See, for example, COM (2010) 245 final on Digital Agenda for Europe, that states in 2.7.3: ‘Fragmentation and complexity in the current licensing system also hinders the digitisation of a large part of Europe’s recent cultural heritage. Rights clearance must be improved, and Europeana – the EU public digital library should be strengthened.’ The older the works, especially books, the higher the percentage of orphan works. The reason for this is that it is sometimes difficult to determine whether the work is still under copyright protection (especially if the work is not dated, as, for example, an undocumented photograph); in many cases, the original creator has died in the meantime and, therefore, the possibly multiple legal heirs have to be identified and traced. See A. Vuopala, ‘Assessment of the Orphan Works issue and costs for rights clearance’, European Commission, 2010, 5; 11–12 Vuopala, 44. Works that can be defined as those which are protected by copyright or related rights and for which no right holder is identified or for which the identified right holder cannot be located, see Art. 2 Dir. 2012/28 on certain permitted uses of orphan works, as well as the definition in Ricolfi et. al, ‘Final report on digital preservation, orphan works and out-of-print works’, European Commission, 10 (High Level Expert Group – Copyright Subgroup): A work to which the right holder cannot be identified or, if identified, cannot be located. COM (2011) 289 final Proposal for Dir. Dir. 2012/28 on certain permitted uses of orphan works. See Part III, 1. Dir. 2012/28 on certain permitted uses of orphan works. The name ‘Europeana’ (meaning ‘European collection’ in Graeco-Latin) refers to the broad content and the different types of material and media that are accessible through the platform.

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network, has been launched, which was inaugurated by Viviane Reding, European Commissioner for Information, Society and Media on 11 November 2008. Europeana is an ambitious and prestigious project endorsed by the European Commission in order 22.29 to make Europe’s cultural heritage accessible to all, inspire creativity and to stimulate the creative economy, as well as to promote cultural tourism. In this regard, Europeana links cultural and scientific collections, enables searching in a common digital frame65 and aims to bring together different types of heritage institutions from all EU Member States. Europeana.eu is a multi-sided platform for digital cultural heritage that serves as a single access 22.30 point to the collections of a large number of museums, libraries and archives. It constitutes a powerful tool for research and acts as an interface to resources from all over Europe, including millions of books, films, paintings, and other museum objects. Europeana is probably one of the most extensive and far-reaching cultural and historical projects ever undertaken in Europe.66 Launched in 2008, it goes back to an idea formulated in a letter sent to the Presidency of Council 22.31 and the Commission on 28 April 2005 by Jacques Chirac, former President of France, together with the premiers of Germany, Italy, Spain, Hungary, and Poland, in which they recommended the creation of a European virtual library.67 Upon the initial launch, approximately 4.5 million digitised items from 27 countries were accessible. 22.32 In the following years, Europeana has been developed into a fully operational service and its collections have grown enormously, thereby surpassing the initial target of 10 million digitised objects by the end of 2010.68 Up to the present day, close to 4,000 institutions, amongst them major players such as the British Library, the Rijksmuseum in Amsterdam and the Louvre, have contributed to Europeana. Designed as a web page that contains a digital library, archive and museum, Europeana currently makes more than 53 million digital items available.69 These facts and figures vividly illustrate the important role Europeana plays regarding the 22.33 digitisation and preservation of Europe’s cultural heritage. In the ‘New Renaissance Report’ in 2011, the European Commission promotes Europeana as ‘the reference point for European culture online’.70

B. Objectives: The Strategic Plan 2011–2015, the Europeana Strategy 2015–2020 and the Europeana Strategy 2020–2025 Intended as a central access point to European memory institutions, Europeana aims to supply 22.34 Europe with extensive cultural information. Through its use, citizens are able to learn about different practices and interpretations of European culture, interact with it and participate in the validation and re-creation of cultural symbols. In order to allow such an occupation, Europeana must cover separate cultural artefacts spread throughout Europe, as cultural heritage is archived in

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N. Baueregger, ‘Europeana und die Deutsche Digitale Bibliothek (DDB): Bedeutung und Herausforderung für die deutsche Bibliothekslandschaft’, (2012) Perspektive Bibliothek, 1, 4, 6. ‘[Europeana is] the EU’s most visible expression of our digital heritage. In less than three years, Europeana has established itself as a reference point for European culture on the Internet. It reflects the ambition of Europe’s cultural institutions to make our common and diverse cultural heritage more widely accessible to all,’ Kroes, 7–8. See: http://ec.europa.eu/information_society/activities/digital_libraries/doc/letter_1/index_en.htm last accessed 21 April 2020. Niggemann, De Decker and Lévy (Comité des Sages), 22. http://ec.europa.eu/information_society/activities/digital_libraries/europeana/index_en.htm last accessed 21 April 2020. See https://op.europa.eu/en/publication-detail/-/publication/79a38a23-e7d9-4452-b9b0-1f84502e68c5 last accessed 21 April 2020.

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museums, as well as public and private organisations.71 Consequently, Europeana gives access to different types of content from a variety of institutions. As a side effect, Europeana offers the institutions concerned the possibility of reaching out to more users and, by this, increase their web traffic. 22.35 Furthermore, Europeana acts as a platform for knowledge exchange between the professionals active in the heritage sector, such as librarians, curators and the creative industries. 22.36 The first objective mentioned in the plan is to ‘strengthen the infrastructure’. The aim is to reduce inefficiencies in the infrastructure of heritage institutions by substantial investments in innovative technologies.72 Therefore the aggregation of content for Europeana shall be more efficient by 2025. 22.37 The second objective is called ‘improve data quality’, and aims at the advancement of content and metadata.73 This objective particularly concerns the promotion of measures to foster innovation in machine learning and crowdsourcing as well as content production and interoperability.74 22.38 The third strategic objective by which Europeana will strengthen consistent output throughout the heritage institutions is titled ‘capacity’ and demonstrates the will to support institutions in their digital transformation.75 In this context, access to knowledge and tools will be provided to institutions and individuals via means such as the Europeana Network Association and the Europeana Aggregators’ Forum. 22.39 and (intentionally left blank) 22.40

C. Organisation 22.41 Europeana was not designed as a content provider. It facilitates the search for digitised cultural content and establishes links to the actual source, thereby guiding the user to the web pages of the owner institutions.76 That is, Europeana does not store the material itself – rather the digital objects remain with the cultural institution and are hosted on their own network. Content will, therefore, be provided through several channels, such as library and university portals or school networks.77 22.42 Aggregation on a national level is hence of the utmost importance78 for the success of Europeana and still seems to be the most efficient way to deliver information.79 Nevertheless, Europeana also started single projects that depend on contributions by individuals and material hosted by Europeana itself.80 The ‘Comité des Sages’ also suggested giving Europeana its own repository and

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Becker, 241. Europeana, Strategic Plan 2011–2015, http://pro.europeana.eu/c/document_library/get_file?uuid= c4f19464–7504– 44db-ac1e-3ddb78c922d7&groupId=10602 last accessed 21 April 2020, 27. Ibid, 31. Ibid. Ibid, 37. Baueregger, 7. https://pro.europeana.eu/share-your-data/process last accessed 21 April 2020. For this reason, Recommendation of 27 October 2011 on the digitisation and online accessibility of cultural material and digital preservation, (REC 2011/711), sets targets for a minimum content contribution per Member State. Europeana, Strategic Plan 2011–2015, 9. To give an example: Culture.fr is the largest aggregator and provides digital objects from about 480 organisations in France, including the Louvre and the Musée d’Orsay, see Candela, 9. See, for example, the project ‘Europeana 1914–1918’ asking citizens to upload pictures, letters, etc., concerning the First World War, http://www.europeana1914–1918.eu/en last accessed 21 April 2020.

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archive, where material in the public domain could be hosted.81 Furthermore, the intention of Europeana is also for the users to contribute content too, for example, through an open source approach.82 Against this background, Europeana promotes collaborations and interoperations between the 22.43 various institutions and focuses on long-term (European and national) funding for the national content providers and aggregators, as well as for Europeana itself, to ensure sustainability.83 The organisation of digitisation projects on this scale, including the development of new ways of exploring content and creating space for creative (re-)use of cultural objects, requires sufficient financial resources.84 Currently, Europeana and the diverse projects supporting the digitisation and contribution of 22.44 content are financed by the European Commission under the Connecting Europe Facility (CEF) programme. As from 2022 it will be funded by the Digital Europe Programme (DEP).85

D. Users Europeana targets very different users. Its goal is to serve the information needs of young school 22.45 pupils, students, teachers and other interested parties, giving them a tool for gathering information and for exporting information for courses, as well as meeting the needs of expert researchers and other professionals, who use the platform for search, verification and annotation of information.86 Besides these education-related users, Europeana is also tailored to the needs of the cultural institutions themselves. For this purpose, a specific interface (Application Programming Interface, API) has been developed.87 This interface enables access to Europeana’s data via external web pages or applications.88 Once the institutions have implemented the API, they are able to integrate Europeana’s digitised content with their own.89 The creative industries (i.e. commercial creators, developers, entrepreneurs and intermediaries) are 22.46 also invited to use the contents made accessible via Europeana. By providing high-quality content, Europeana can be a tool and a source for the creation of new products and services developed in the creative and information industry as well as in tourism. Thus, recombination in different contexts can foster innovation in the creative industries, leading to new marketable products (which may become cultural heritage themselves one day). Therefore, inter alia, Europeana labs have been launched as an interface for creatives. Lastly, the general public in the European Union – potentially the largest user group – receives, 22.47 interacts with and reflects on cultural heritage via Europeana. The sheer number of digitised items

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Niggemann, De Decker and Lévy (Comité des Sages), 24. http://ec.europa.eu/information_society/activities/digital_libraries/info_centre/cultural/disclaim/in-dex_en.htm> last accessed 21 April 2020. Europeana, Strategic Plan 2011–2015, 6; see also Ferro, 50. In this context, see also Council Concl. on Europeana: next steps. Europeana Strategy 2020–2025, 44. Candela et al., ‘History, evolution, and impact of digital libraries’, in I. Iglezakis, T.-E. Synodinou and S. Kapidakis (eds), E-Publishing and Digital Libraries: Legal and Organizational Issues, Information Science Reference, Hershey/ New York, 2011, 9. Baueregger, 8. Thus, Europeana increases the usability of its services, see http://www.pro.europeana.eu/web/guest/users last accessed 1 March 2013. This allows, for example, the creation of an online exhibition of a national museum or archive featuring their own digitised material involving content held in Europeana, J. Purday, ‘Intellectual property issues and Europeana, Europe’s digital library, museum and archive’, 2.

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combined with the easy access, wherever and whenever the end-user wants, creates new opportunities for sharing and re-use, empowering people to create new works and to explore their shared heritage.90 Such users mainly act through the Europeana web page, the API or social media.91 Furthermore, end-users may engage with active communities who are deeply connected to specific fields of interest and who will help in the case of questions within Europeana.

E. Europeana as a means to drive innovation and a tool to preserve the cultural heritage 22.48 Europeana has considerable potential to stimulate and promote innovation, and to facilitate the access to and the dissemination of information. It is already a guardian of Europe’s cultural heritage. Not only Europeana, but all digital libraries play an important role in the digital age and secure lifelong access to cultural heritage which builds the blocks of our civilisation, ‘they are our past, our present and our future’.92 In addition, Europeana promotes the concept of open data and can act as the voice of Europe’s cultural heritage institutions. Moreover, it brings the focus onto digitisationrelated copyright issues and the necessary harmonisation efforts regarding intellectual property rights in general. A large part of the content that has been digitised and is provided by the different heritage institutions, such as libraries and archives, is no longer protected by copyright. If such content is digitised by private–public partnerships under the label ‘Out of copyright – noncommercial re-use’ users might utilise the content on a non-commercial basis for a limited time. In addition to public domain works, digitisation of cultural heritage must also comprise contents originally protected by intellectual property rights, notably copyright, in order to be comprehensive and sustainable. This, however, is a key challenge, because the digitisation might infringe the rights granted under current copyright legislation within the EU. 22.49 Copyright compliance is a real challenge for digital libraries, and is not only a legal but also an ethical issue.93 The latter is, for example, shown by the fact that most librarians’ codes contain an obligation to recognise the rights of creators and copyright holders.94 The European initiatives and institutions on digitisation have always stressed that the process of digitisation must be carried out fully respecting copyright and related rights.95

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Purday, 4. Search engines and further services via newsletters, etc., lead the users to Europeana’s web pages, see http:// www.pro.europeana.eu/web/guest/traffic last accessed 21 April 2020. However, they do not enable direct engagement with Europeana’s contents. Kallinikou et al., ‘Intellectual property issues for digital libraries at the intersection of law, technology and the public interest’, in I. Iglezakis, T. E. Synodinou and S. Kapidakis (eds), E-Publishing and Digital Libraries: Legal and Organizational Issues, Information Science Reference, Hershey / New York, 2011, 295, referring to Mason, 2009. Kallinikou et al., 296. Ibid. See, for example, Council Concl. on Europeana: next steps; Council Concl. on the digitisation and online accessibility of cultural material and digital preservation, http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ educ/130120.pdf (last accessed 21 April 2020).

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IV. DIGITISATION AND COPYRIGHT LAW: A TENSION WITH CONSEQUENCES

IV. DIGITISATION AND COPYRIGHT LAW: A TENSION WITH CONSEQUENCES 1. Digitisation of public domain content A. The public domain As has been mentioned before, much of the cultural heritage material subject to digitisation lies in 22.50 the public domain.96 Therefore, it is not very surprising that the content that has been made available through Europeana is also mostly public domain content;97 but what falls within the public domain? The scope of the public domain is not easy to grasp, but it contains works and content not protected 22.51 by intellectual property rights, in any case.98 From this point of view, it is the opposite to the entirety of intellectual property protection – including the basic arrangements and ideas for intellectual creation, as well as contents whose protection is not claimed, is limited or has expired.99 Works in the public domain are, consequently, not assigned to anyone. This is beneficial to digitisation endeavours, as no time and money has to be spent on finding 22.52 the copyright owner and obtaining consent for both digitisation and making the content available.100 The benefits of digitisation concerning preservation and access can then be realised comprehensively. What is more, the contents in the public domain can be freely combined, re-arranged, transformed, 22.53 and reworked, enabling unlimited possibilities for creative play (i.e. re-use). To put it in positive terms, the public domain contains the ‘building blocks’101 for cultural innovation in the original sense – goods produced by intellectual efforts, which can be freely advanced through being merged, split or presented in a new context by everyone. In this regard, the public domain is a vital part of the cultural communication cycle between creators, intermediaries and users.102 Not having to obtain permission for specific use enables individuals to realise their creative ideas instantly and accurately. Therefore, the public domain provides space for emerging innovative cultural practices, utilising the technical opportunities offered by digitisation.

B. The (re-)privatisation of the public domain However, in some circumstances, legal and technical measures might limit the availability of 22.54 digitised public domain contents. Online access to cultural heritage can be restricted by market participants (re-)privatising contents that have previously been in the public domain.103

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Purday, 3; Lucas-Schloetter, 160. Lucas-Schloetter, 160, referring to EU Press Release 28 August 2009, IP/09/1257, according to which Europeana, for legal reasons, actually does not contain orphan works or works that are out of print. J. Boyle, The Public Domain. Enclosing the Commons of the Mind, Yale University Press, New Haven & London, 2008, 38; A. Peukert, Die Gemeinfreiheit: Begriff, Funktion, Dogmatik, Mohr Siebeck, Tübingen, 2012,18; also C. Angelopoulos, ‘The myth of European term harmonisation – 27 public domains for 27 Member States’, (2012) International Review of Intellectual Property and Competition Law, 43, 567, 569, notes that the public domain is commonly defined ‘[…]in opposition to copyright […]’. Peukert, 19, identifies structural, time-related, intended, and specified dimensions of the public domain. Angelopoulos, 568–9. Boyle, 41. H. Haberstumpf, Handbuch des Urheberrechts, 2nd ed., Luchterhand, Neuwied et al., 2000, 31–2. See generally Purday, 5; M. Stieper, ‘Geistiges Eigentum an Kulturgütern. Möglichkeiten und Grenzen der Remonopolisierung gemeinfreier Werke’, (2012) GRUR 114, 1083. See also Council Concl. on Europeana: next steps, stating that joint work must continue ‘to ensure the widest availability of public domain works after their digitisation’.

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22.55 While the transformation of fixed intellectual expression (e.g. books) into digital format is unlikely to generate protection as a copyright work due to a lack of ‘independent originality’,104 photographs without sufficient originality could gain protection through related rights if such measures have been implemented by the Member States.105 Moreover, according to regulations in the Member States, photographic reproductions of two- and three-dimensional cultural objects might be protected by exclusive rights.106 22.56 Indeed, one will have to distinguish between the categories of the works being digitised in all relevant cases: Precise photographic reproductions of two-dimensional fixations of copyright works amount to nothing more than mere copying without any creative leeway. In contrast, digitisation of three-dimensional artefacts requires some degree of creativity in finding focus and angle.107 22.57 Reprivatisation via copyright law might not only result from the very act of digitisation. As works that have not been communicated to the public since their creation may (again) gain copyright protection when first published108 (e.g. via the internet), users are excluded from free use of such public domain contents for a limited time. However, under these circumstances, the legal reprivatisation of intellectual works does not impact on the cultural practice. The public domain is not deprived of the cultural content as the work is first introduced to the public by making it available on the internet.109 22.58 The situation is different regarding intellectual works in the public domain which are sought to be registered as trademarks. As protection for a (community) trademark is not theoretically110 limited in time, contents out of copyright may be used exclusively again as a trademark. However, the use of trademarks is aimed at a subject different from that of copyright protection: As trademarks intend to distinguish between the origin of particular goods, only such use is protected by trademark law.111 Thus, reprivatisation can only occur within the scope of trademark uses. 22.59 Judgments of the Federal Court of Justice in Germany (Bundesgerichtshof, BGH) raise concerns about public domain contents being reprivatised through property law.112 The court held that the

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A. Rahmatian, ‘Copyright protection for the restoration, reconstruction and digitisation of public domain works’, in E. Derclaye (ed.), Copyright and Cultural Heritage. Preservation and Access to Works in a Digital World, Edward Elgar, Cheltenham, UK and Northampton, MA, USA, 2010, 73; see the detailed account in A. Talke, ‘Lichtbildschutz für digitale Bilder von zweidimensionalen Vorlagen’, (2010) 54 Zeitschrift für Urheber und Medienrecht (ZUM), 847–9, regarding the protectability of digitised works as photographic works under German copyright law. In Germany, for example, § 72 UrhG grants rights for non-original photographs comparable to copyright protection, as confirmed in the judgment of 20 December 2018 – ‘Museumsfotos’, (2019), Zeitschrift für Urheber- und Medienrecht 63, 335. Art. 6 Dir. 2006/116 on the term of protection states that photographs which are ‘the author’s own intellectual creation’ should be protected as copyright works; Member States might also arrange protection for ‘other photographs’. Talke, 849. See Art. 4 Dir. 2006/116 on the term of protection stating that ‘[a]ny person who, after the expiry of copyright protection, for the first time lawfully publishes or lawfully communicates to the public a previously unpublished work, shall benefit from a protection equivalent to the economic rights of the author’; see also Dusollier, 41. See Stieper, 1086; E. Langer, Der Schutz nachgelassener Werke. Eine richtlinienkonforme und rechtsvergleichende Auslegung von § 71 UrhG, V&R Unipress, Göttingen, 2012, 70; F.L. Stang, Das urheberrechtliche Werk nach Ablauf der Schutzfrist. Negative Schutzrechtsüberschneidung, Remonopolisierung und der Grundsatz der Gemeinfreiheit, Mohr Siebeck, Tübingen, 2011, 143. Art. 46 Reg. 207/2009 on the community trademark provides renewal opportunities every ten years; see critically L. Lessig, The Future of Ideas. The Fate of the Commons in a Connected World, Random House, New York, 2001, 316, at footnote 60, from a US perspective. S. Dusollier, ‘Scoping study on copyright and related rights and the public domain’, WIPO, 2011, 48; see R. Osenberg, ‘Markenschutz für urheberrechtlich gemeinfreie Werkteile’, (1996) GRUR, 98, 104, as well as Stieper, 1091, regarding trademark law in Germany. BGH Judgment of 17 December 2010 – ‘Preußische Schlösser und Gärten’, (2011) Neue Juristische Wochenschrift 64, 753 and BGH Judgment of 1 March 2013 – ‘Preußische Schlösser und Parkanlagen’, (2013) Zeitschrift für Urheber- und

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IV. DIGITISATION AND COPYRIGHT LAW: A TENSION WITH CONSEQUENCES

estate owners’ property right may cover the capacity to prevent photographs being taken on the proprietor’s premises – and, in a way, created an intellectual property right for the owner of a cultural object.113 According to the Court, the property right is violated if the photograph is not taken from a generally accessible spot but from the premises and no contractual permission to take photographs was granted.114 In the absence of a contractual permission, the owner even has the right to prohibit the exploitation of the photographs as he is entitled to damages.115 Lastly, database protection may encapsulate works whose copyright protection has terminated, as 22.60 well as contents that have never been protected by copyright. The sui generis database right secures the efforts in generating ‘a collection of independent works, data or other materials’.116 Following substantial investment, such collections are protected against unauthorised use of substantial parts.117 Similarly, copyright in original databases prevents exploitation of the database without consent of the copyright owner.118 The actual contents of the database (data, works, etc.) might remain in the public domain, however, they cannot be accessed without circumventing measures prohibiting their use. Irrespective of this (possible) legal (re-)privatisation of public domain contents, digitisation bears 22.61 the risk of single businesses controlling the digitised contents via technological access barriers. Through technological protection measures, users can be excluded from the contents factually.119 Many of these measures restrict access to works in the public domain. As long as the public can gain access to the information incorporated in the works from other sources, such access barriers pose no problem.120 However, the public domain becomes endangered when its contents are only available through technically protected channels on the internet, particularly when circumvention of the technical measures is prohibited by (copyright) law.121

2. The digitisation of copyrighted material as a special challenge Even though a large part of the content provided by the different heritage institutions is no longer 22.62 protected by copyright, many works that need to be digitised and made available are still under copyright protection. Since libraries and other cultural institutions usually own only physical copies of works, but cannot claim copyright in their collection of works, digitisation of this copyrightprotected content, especially in cases in which the right holder of work cannot be identified or if identified, cannot be traced (so-called orphan works), is a key challenge.122

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Medienrecht 57, 571; see E. Wackel, ‘Anmerkung zu BGH, Urt. v. 01.03.2013 – V ZR 14/12’, (2013) Neue Juristische Wochenzeitschrift 66, 1812; BGH Judgment of 19 December 2014 – ‘Preußische Kunstwerke’, (2015), Zeitschrift für Urheber- und Medienrecht 59, 496. Stieper, 1085. BGH Judgment of 19 December 2014 – ‘Preußische Kunstwerke’, (2015), Zeitschrift für Urheber- und Medienrecht 59, 496 BGH Judgment of 12 December 2018 – ‘Museumsfotos’, (2019), Zeitschrift für Urheber- und Medienrecht 63, 335, 341. Dir. 96/9 on the legal protection of databases, Art. 1. Ibid, Art. 7. G. Scanlan, ‘The database directive – One step too far?’ (2004) Nottingham Law Journal, 13, 38. See K.J. Koelman, ‘The public domain commodified: Technological measures and productive information use’, in L. Guibault and P.B. Hugenholtz (eds), The Future of the Public Domain. Identifying the Commons in Information Law, Kluwer Law International, Alphen a.d.R., 2006, 108; Dusollier, 43; P. Samuelson, ‘Mapping the digital public domain: Threats and opportunities’, (2003) Law and Contemporary Problems, 66, 152. Samuelson, 152; Dusollier, 44. Frosio, 26. See regarding this challenge Part V.

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22.63 In those legal systems that belong to the continental system regarding intellectual property, copyright and related rights protection, especially, are regularly addressed by economic and moral rights, which ought to be respected in the digitisation process.

A. Economic rights 22.64 The so-called ‘digital rights’123 are of special significance for the on-going digitisation projects, i.e. the right of reproduction and the right of distribution of copyrighted material, as well as the right of communicating the work to the public that have been introduced on the European level, in addition to the existing economic rights, by Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society.124 22.65 The reproduction right that also applies in the digital world typically grants the holder the exclusive right to ‘authorise or prohibit direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part’.125 This means that any effort to preserve cultural heritage by converting it into digital form, for example making digital copies for preservation purposes or future use, and also the production of backup copies, implies the exploitation of the reproduction right.126 This right is also relevant in the analogue world if cultural objects, including works of fine art, literature or architecture, are copied by format shifting. 22.66 As such uses are exclusively