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Private Copying and Downloading from Unlawful Sources

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Abstract

Private copying is one of the most contested areas of EU copyright law. This paper surveys that nebulous area and examines the issue of copies made from unlawful sources in light of the ECJ’s ACI Adam decision. After describing the legal background of copyright levies and the facts of the litigation, the paper scrutinizes the Advocate General’s Opinion and the Court’s decision. The latter is analyzed against the history of copyright levies, the ECJ’s extensive case law on the private copying limitation and Member States’ regulation of unlawful sources. This paper further reflects on the decision’s implications for end-users, rights holders, collective management organizations and manufacturers/importers of levied goods. It concludes that, from a legal and economic standpoint, the decision not only fails to be properly justified, but its consequences will likely diverge from those anticipated by the Court. Most worrisome is the Court’s stance on the three-step test, which it views as a restrictive, rather than enabling, clause. In its interpretation of the test, the decision fails to strike the necessary balance between competing rights and interests. This is due to multiple factors: overreliance on the principle of strict interpretation; failure to consider the fundamental right of privacy; lack of justification of the normative and empirical elements of the test’s second condition; and a disregard for the remuneration element in connection with the test’s third condition. To the contrary, it is argued that a flexible construction of the three-step test is more suited to the InfoSoc Directive’s balancing aims.

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Notes

  1. “Green Paper on Copyright and the Challenge of Technology – Copyright Issues Requiring Immediate Action”. COM (88) 172 final, 7 June 1988, at 99–142. See also Poort and Quintais (2013).

  2. 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 (InfoSoc Directive) (22 June 2001) OJ L 167, pp. 10–19. On the history of the provision, see Hugenholtz (2012).

  3. IP/13/80 (31 January 2013), “Mediation on private copying and reprography levies: António Vitorino presents his Recommendations to Commissioner Barnier”, available at http://europa.eu/rapid/press-release_IP-13-80_en.htm?locale=en.

  4. On which see Leistner (2014).

  5. See ECJ Case C-467/08 – Padawan v. SGAE (2010) ECR I-10055; ECJ Case C-462/09 – Stichting de Thuiskopie v. Opus Supplies Deutschland GmbH and Others (2011) ECR I-5331; ECJ Case C-277/10 – Martin Luksan v. Petrus van der Let (9 February 2012) ECLI:EU:C:2012:65; ECJ Joined Cases C-457-460/11 – VG Wort v. Kyocera and Others (27 June 2013), ECLI:EU:C:2013:426; ECJ Case C-521/11 – Amazon.com International Sales Inc. and Others v. Austro-Mechana Gesellschaft zur Wahrnehmung mechanisch-musikalischer Urheberrechte Gesellschaft mbH (11 July 2013), ECLI:EU:C:2013:515; ECJ Case C-435/12 – ACI Adam BV and Others v. Stichting de Thuiskopie, Stichting Onderhandelingen Thuiskopie vergoeding (10 April 2014), ECLI:EU:C:2014:254, see this issue of IIC at doi:10.1007/s40319-014-0294-8.

  6. Case C-463/12, Copydan Båndkopi v. Nokia Danmark, OJ 2012, C 399/13–14. See Opinion of A.G. Villalón in Copydan Båndkopi (18 June 2014), ECLI:EU:C:2014:2001 [not available in English], particularly paras. 81–96. At the time of writing, the following cases were also pending: ECJ, Case C-470/14 – EGEDA and Others; and ECJ, Case C-572/14 – Austro-Mechana.

  7. Documents relating to stakeholder consultations available at http://ec.europa.eu/internal_market/copyright/levy_reform/index_en.htm. See COM (2011) 287 final (24 May 2011), “Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions, 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”, at 12–13, 23. For a subsequent and less comprehensive approach to copyright levies, see also COM (2012)789 final, “Communication on content in the Digital Single Market”, 18 December 2012, at 4 et seq.

  8. Vitorino (2013).

  9. See “Public Consultation on the review of the EU copyright rules”, available at http://ec.europa.eu/internal_market/consultations/2013/copyright-rules/docs/consultation-document_en.pdf, at 31–33. (Questions 64–71); IP/13/1213 (05/12/2013), “Copyright – Commission launches public consultation”, available at http://europa.eu/rapid/press-release_IP-13-1213_en.htm?locale=en; and European Commission – Directorate General Internal Market and Services, “Report on the responses to the Public Consultation on the Review of the EU Copyright Rules”, July 2014, available at http://ec.europa.eu/internal_market/consultations/2013/copyright-rules/docs/contributions/consultation-report_en.pdf, at 72–77.

  10. European Parliament Resolution of 27 February 2014 on private copying levies (2013/2114(INI)). On the private copying issues of cloud-based services, see Senftleben (2013). On stakeholders concerns surrounding the interaction between cloud services and private copying, see European Commission, “Report on the responses to the Public Consultation…”, supra note 9, at 72–77.

  11. Opinion of A.G. Villalón in ACI Adam (9 January 2014), ECLI:EU:C:2014:1.

  12. ACI Adam, paras. 3–6, identifying the relevant provisions.

  13. Hugenholtz et al. (2006).

  14. Namely, those in Art. 5(2)(a), (b) and (e) InfoSoc Directive.

  15. Article 1(2)(a) and (e) InfoSoc Directive.

  16. See von Lewinski and Walter (2010). The term “private use” features also in Art. 15(1)(a) 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) (27 December 2006) (Rental and Lending Directive), OJ L 376, pp. 28–35, and Arts. 6(2)(a) and 9(a) Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996 on the legal protection of databases (Database Directive) (27 March 1996), OJ L 77, pp. 20–28. For further implications of this concept, see: Poort and Quintais, supra note 1, at 207–209; Karapapa (2012).

  17. Poort and Quintais, supra note 1, at 208 (and references cited therein).

  18. Id. at 216.

  19. Recital 35 InfoSoc Directive.

  20. Id.

  21. See Padawan, paras. 38–42. See also Poort and Quintais, supra note 1, at 208, noting the difference to the concept of equitable remuneration [Art. 8(2) Rental and Lending Directive], based on the value of the use in trade. See ECJ Case 245/00 – Sena v. Nos (2003) ECR I-1251, paras. 36–37, and ECJ Case 192/04 – Lagardère (2005) ECR I-7199, para. 50.

  22. Article 6(1)–(3) InfoSoc Directive.

  23. Article 6(4), fourth subparagraph, and Recital 53 InfoSoc Directive. See also Poort and Quintais, supra note 1, at 209.

  24. See Recitals 52 and 39 InfoSoc Directive.

  25. See Hugenholtz et al. (2003), Helberger and Hugenholtz (2007) and van Eechoud et al. (2008). Contra the argument that the InfoSoc Directive provides for automatic phasing out of levies, see von Lewinski and Walter, supra note 16, at 1034.

  26. Article 5(5) InfoSoc Directive, emphasis added to identify the three “steps” or conditions of the test.

  27. Article 6(3) 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) (5 May 2009) (Computer Programs Directive), OJ L 111, pp.16–22.

  28. Article 6(3) Database Directive.

  29. The application of the Rental and Lending Directive test to this instrument operates by virtue of Art. 11(1)(b) InfoSoc Directive.

  30. For an in depth influential analysis of the three-step test see Senftleben (2004).

  31. ACI Adam, para. 12.

  32. Id. para. 13. See also Visser (2012).

  33. ACI Adam, paras. 10, 14.

  34. Id. paras. 15–19; Opinion of A.G. Villalón in ACI Adam, paras. 12–18.

  35. ACI Adam, paras. 15–19.

  36. The Court examines these questions jointly in ACI Adam, paras. 20–58. The third and final question refers to whether or not the Enforcement Directive (2004/48/EC) applies to proceedings “in which those liable for payment of the fair compensation bring an action before the referring court for a ruling against the body responsible for collecting that remuneration and distributing it to copyright holders, which defends that action”. The Court answers in the negative. See ACI Adam, paras. 7–8, 59–65. See also Opinion of A.G. Villalón in ACI Adam, paras. 85–91.

  37. Opinion of A.G. Villalón in ACI Adam, paras. 51–54.

  38. Id. para. 55.

  39. Id. paras. 57, 63.

  40. Id. paras. 71–72.

  41. Id. paras. 35–36, 64–69.

  42. Id. paras. 72, 75.

  43. Id. paras. 76–77.

  44. Id. paras. 79–84, 92.

  45. Id. paras. 80–84, 92.

  46. ACI Adam, paras. 25–27.

  47. Id. paras. 22, 29–30. See also ECJ Case C-5/08 – Infopaq International A/S v. Danske Dagblades Forening (2009) ECR I-6569, ECLI:EU:C:2009:465, para. 56 and case law cited therein.

  48. See Recitals 22 and 33 InfoSoc Directive.

  49. ACI Adam, paras. 31–37.

  50. Id. para. 38.

  51. Id. para. 39.

  52. Id. para. 40.

  53. See infra VI.0.

  54. ACI Adam, para. 41.

  55. On which, see J.P. Quintais, Case annotation of VG Wort judgement from 10 July 2013, “On copyright levies, printers, plotters and personal computers (VG Wort v Kyocera and others)”, available at http://kluwercopyrightblog.com/2013/07/10/on-copyright-levies-printers-plotters-and-personal-computers-vg-wort-v-kyocera-and-others/.

  56. ACI Adam, para. 43.

  57. Id. para. 44.

  58. Id. paras. 45–46.

  59. Id. paras. 47–54, 57. Recital 31 mentions the need adjust the degree of harmonization of exceptions and limitations in light of cross-border exploitation of works and the new electronic environment in light of the objectives of ensuring “the proper functioning of the internal market” and achieving a “fair balance of rights and interests between the different categories of rightholders, as well as between the different categories of rightholders and users”.

  60. ACI Adam, paras 55–56.

  61. Id. para 58.

  62. See Reinbothe (1981), Collová (1991) and Hugenholtz, supra note 2, at 180–191.

  63. See Collová, supra note 62, at 42–48; Reinbothe, supra note 62, at 37–47; Hugenholtz, supra note 2, at 180–191.

  64. See Hilty and Nérisson (2012), noting that “Consideration of privacy and of the weak feasibility of any control in such an area explains the fact why lawmakers authorized the private copy”.

  65. See Records Berne Convention (1967 Stockholm), at 752, 757–762, 771–772. See also Senftleben 2004, supra note 30, at 53–56.

  66. Hugenholtz, supra note 2, at 192–193.

  67. COM (1997) 628 final, Brussels, 10 December 1997. On the privacy justification of private copying; see also Helberger and Hugenholtz, supra note 25, at 1068–1069.

  68. Because it is unrelated to the core of the ACI Adam judgment, this section does not discuss the Court’s decisions related to the liability and effective burden of compensation in levy systems, on which see Padawan, paras. 44–46, 57; Stichting de Thuiskopie, paras 35; Amazon.com, paras. 16–37. See also Leistner, supra note 4, at 588–589.

  69. Padawan, paras. 32, 37.

  70. Recitals 31 and 32 InfoSoc Directive. See Padawan, paras. 34–35. Clarifying the different objectives of the Directive, see ECJ Joined Cases C-403 and 429/08 – Football Association Prelimer League Ltd, netMed Hellas SA, Multichoice Hellas SA (C-403/08) v. QCLeisure et al., and Karen Murphy v. Media Protection Services Ltd (C-429/08) (2011) ECR I-9083, para. 186; ECJ Case C-510/10 – DR and TV2 Danmark v. NCB (26 April 2012) ECLI:EU:C:2012:244, para. 35; ECJ Case C-145/10 – Eva-Maria Painer v. Standard VerlagsGmbH and Others (1 December 2011) I-12533, para. 132.

  71. Luksan, paras. 88 et seq. 96–106. See also Stichting the Thuiskopie, para 34. See Leistner, supra note 4, at 587–588.

  72. See Stichting the Thuiskopie, paras. 33 et seq.; Padawan, paras. 7, 39–41. See also Leistner, supra note 4, at 587.

  73. Padawan, paras. 40, 42; Stichting the Thuiskopie, paras 24.

  74. VG Wort, para. 40. Proposing a different interpretation see Opinion of A.G. Villalón in Copydan Båndkopi, paras. 57–68.

  75. VG Wort, paras. 34–39. In this point, the Court diverges from the Opinion of A.G. Sharpston in VG Wort, paras. 119–121. See Poort and Quintais, supra note 1, at 210.

  76. Poort and Quintais, supra note 1, at 210, 218–219.

  77. VG Wort, paras. 48–57. With a broader interpretation of Member States’ discretion, see Opinion of A.G. Sharpston in VG Wort, para. 104. See Poort and Quintais, supra note 1, at 211.

  78. VG Wort, para. 58.

  79. See Opinion of A.G. Villalón in Copydan Båndkopi (18 June 2014), especially paras. 57–68, ECLI:EU:C:2014:2001 (not available in English).

  80. The position expressed in this paragraph was described by Professor Alexander Peukert in a recent panel discussion at the Institute for Information Law’s “Information Influx” Conference. See, for additional detail, Quintais (2014).

  81. WIPO, “International Survey on Private Copying. Law and Practice 2013”, available at http://www.wipo.int/export/sites/www/freepublications/en/copyright/1037/wipo_pub_1037_2013.pdf. The one Member State not referred in the survey is Slovenia, which however does not seem to include specific regulation of this topic. See Trampuz (2012), analyzing Art. 50 Slovenian Copyright Act and implementing regulations.

  82. WIPO, supra note 81, at 4.

  83. Id. at 2–3, referring in the first group Cyprus, Ireland, Luxembourg, Malta and the UK, and in the second Bulgaria. However, the UK has since implemented a narrow and uncompensated private copying exception. See “The Copyright and Rights in Performances (Personal Copies for Private Use) Regulations 2014”, available at http://www.legislation.gov.uk/uksi/2014/2361/contents/made.

  84. WIPO, supra note 81. The Member States in question are Croatia, Czech Republic, Estonia, Finland, Greece, Hungary, Latvia, Netherlands, Poland, Portugal, Romania, Slovakia. However, note that Finnish law apparently does stipulate that private copying is only admissible if copies “are made from a legally obtained original”. See Geiger (2008), making reference to Sec. 11(5) Finnish Copyright Act of 8 July 1961, as amended in 2005. Moreover, as per Karapapa, in Hungary the “source copy must be legal according to the Copyright Experts Council”. See Karapapa, supra note 16, 182.

  85. WIPO, supra note 81, at 20 (Austria), 24 (Belgium), 44 (Denmark), 55–56 (France), 63 (Germany), 77–78 (Italy), 95–96 (Lithuania), 128–129 (Spain), 131 (Sweden).

  86. See Art. 22, Sec. 1, 5° Belgian Copyright Act (Law of 30 June 1994), and Royal Decree of 18 October 2013 on the right to remuneration for private copying. See also WIPO, supra note 81, at 24.

  87. See Vanbrabant and Strowel (2012).

  88. For Lithuania, see Art. 20 Lithuanian Law on Copyright and Related Rights, WIPO, supra note 81, at 95, and von Mizaras (2012). For Greece, see Kallinikou (2012).

  89. See Sec. 53(1) German Copyright Act. See Dreier and Specht (2012). See also WIPO, supra note 81, at 63.

  90. See Xalabarder (2012). See also WIPO, supra note 81, at 128–129 (making reference to Arts. 21 and 31(2) Consolidated Text of the Spanish Law on Intellectual property – Law 23/2006, of 7 July, as amended – and Real Decreto 1657/2012).

  91. See Xalabarder (2014). For a legal challenge before the ECJ regarding the validity of the Spanish law on private copying see also ECJ, Case C-470/14 – EGEDA and Others, on whether the levy scheme set up by Spanish law, financed from state resources and based on an estimate of the harm actually caused by private copying is compatible with Art. 5(2)(b) InfoSoc Directive.

  92. See Carre (2012), making reference to L. 311-1 of the French Intellectual Property Code and Law No. 2011-1898 of 20 December 2011. See also WIPO, supra note 81, at 56, referring to Arts. L311-1 up to L311-8 Intellectual Property Code. For the situation prior to the 2011 amendment, including a description of contradictory case law, see Geiger, supra note 84.

  93. Rognstad (2012), citing Sec. 12, fourth paragraph Swedish Copyright Act, and Sec. 11, second paragraph Danish Copyright Act (Consolidated Act on Copyright No. 202 of 27 February 2010, as amended). See also WIPO, supra note 81, at 44.

  94. Section 12, third paragraph Danish Copyright Act (WIPO translation).

  95. Article 71sexies(4) Italian Copyright Act. See WIPO, supra note 81, at 77–78, and Sica and D’Antonio (2012).

  96. Making this point, see Mazziotti (2013).

  97. See “Kamerbrief over Arrest ACI Adam BV e.a. tegen Stichting de Thuiskopie en Stichting Onderhandelingen Thuiskopie vergoeding” (17 April 2014), available at http://www.rijksoverheid.nl/documenten-en-publicaties/kamerstukken/2014/04/18/arrest-aci-adam-bv-ea-tegen-stichting-de-thuiskopie-en-stichting-onderhandelingen-thuiskopie-vergoeding.html.

  98. For an historical account, see Consumentenbond and bureau Brandeis, Letter to the ECJ “Re: Opinion of Advocate-General Cruz Villalón regarding downloading from illegal sources” (9 April 2014), available at http://bureaubrandeis.com/press-room/consumentenbond-and-bureau-brandeis-call-on-ecj-do-not-ban-downloading-by-consumers/, at 4–5; and Visser, supra note 32, at 417–433.

  99. See Brein, “Hof van Justitie EU oordeelt dat downloaden van illegaal aanbod illegaal is” (10 April 2014), available at http://www.anti-piracy.nl/nieuws.php?id=322.

  100. Consumentenbond and bureau Brandeis, supra note 98, at 2.

  101. Id. at 9.

  102. See Poort and Leenheer (2012), and Karaganis and Renkema (2012).

  103. On ECJ case law regarding the need to interpreted EU law with respect for the right of privacy see, e.g. ECJ Case C-101/01 – Criminal proceedings against Bodil Lindqvist (6 November 2003) I-12971, para. 87; ECJ Case C-275/06 – Productores de Música de España (Promusicae) v. Telefónica de España SAU. (29 January 2008) I-00271, para. 68; ECJ Case C-557/07 – LSG-Gesellschaft zur Wahrnehmung von Leistungsschutzrechten (19 February 2009) I-01227, para. 28; ECJ Case C-70/10 – Scarlet Extended (24 November 2011) I-11959, para. 45.

  104. Consumentenbond and bureau Brandeis, supra note 98, at 3. For empirical data on levy distribution schemes, see WIPO, supra note 81, at 8–9.

  105. Also raising the issue and echoing similar concerns by the Dutch parliament, see Consumentenbond and bureau Brandeis, supra note 98, at 7.

  106. ECJ Case C-466/12 – Nils Svensson and others v. Retriever Sverige AB (13 February 2014) ECLI:EU:C:2014:76, para. 32. On the controversy between European copyright lawyers (namely the European Copyright Society and the ALAI) on the outcome of Svensson, see Leistner, supra note 4, at 573–274 (with additional references); Savola (2014). On this topic, see pending ECJ Case C-348/13 – Best Water International v. Mehes and Potsch, and Case C-279/13 – C More Entertainment AB v Linus Sandberg.

  107. Svensson, para. 31.

  108. Raising some of these issues in the analysis of Svensson, see, e.g. Arezzo (2014), Headdon (2014) and Savola, supra note 106, at 282–283.

  109. Consumentenbond and bureau Brandeis, supra note 98, at 6–7.

  110. Poort and Quintais, supra note 1, at 216.

  111. Id. at 216.

  112. Id. at 216–218.

  113. Poort (2013), developing insights from Besen and Kirby (1989).

  114. Poort and Quintais, supra note 1, at 217.

  115. Koelman (2005).

  116. Poort and Quintais, supra note 1, at 218–219.

  117. Hugenholtz, Guibault and van Geffen, supra note 25, at 4.

  118. For details about the functioning of the Dutch levy system prior to ACI Adam, see WIPO, supra note 81, at 101–104.

  119. Id. at 6 (Fig. 1).

  120. Leistner, supra note 4, at 569 et seq.

  121. Murphy, paras. 163 et seq. Painer, para. 132.

  122. Leistner, supra note 4, at 585. Note also, more recently, ECJ Case C - 201/13 – Deckmyn, paras. 25–28.

  123. Opinion of A.G. Villalón in ACI Adam, para. 78. For criticism, see Consumentenbond and bureu Brandeis, supra note 98, at 3.

  124. Leistner, supra note 4, at 586.

  125. Similarly, see Rosati (2014).

  126. Id., noting the Court’s reliance on Recital 32 InfoSoc Directive. See ACI Adam, paras 33–34.

  127. ACI Adam, para 27, relying on Recital 44 of the Directive.

  128. Murphy, paras 163 et seq. The general point is made in Leistner, supra note 4, at 585.

  129. Hugenholtz and Okediji (2008); and European Copyright Society (2014).

  130. Id., at 25.

  131. Geiger et al. (2008).

  132. Id.

  133. Id.

  134. Id.

  135. Hugenholtz and Senftleben (2011).

  136. Senftleben (2006).

  137. For criticism of the similar reasoning in the Opinion, see Consumentenbond and bureau Brandeis, supra note 98, at 9.

  138. See supra note 10.

  139. Since the early 21st century legal and economics scholars, advocacy groups and even political parties have come forward with proposals under different labels: alternative compensation systems, tax-and-royalty systems, license globale, content/culture flat-rate, creative contribution, file-sharing levy, sharing license or alternative reward systems. For an ongoing research project in this field where the author is involved, including a list of bibliography, see Institute for Information Law, “Copyright in an Age of Access: Alternatives to Copyright Enforcement”, available at http://www.ivir.nl/research/projects/acs.html. See also Quintais, supra note 80. For a recent skeptical perspective, see Mazziotti, supra note 96, at 87–89.

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Authors and Affiliations

  1. Institute for Information Law (IViR), University of Amsterdam, Amsterdam, The Netherlands

    João Pedro Quintais (LL.M. (MIPLC); PhD Candidate)

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  1. João Pedro Quintais
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Correspondence to João Pedro Quintais.

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The author wishes to thank Joost Poort and Alexander de Leeuw for thoughtful comments on earlier drafts.

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Quintais, J.P. Private Copying and Downloading from Unlawful Sources. IIC 46, 66–92 (2015). https://doi.org/10.1007/s40319-014-0295-7

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