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The CJEU rules on the liability regime of Internet service providers under the EU Copyright Directive

The European Court of Justice issued an important decision on the liability regime applicable to online content sharing Internet service providers under the EU Copyright Directive.

The Court of Justice of the European Union issued a long awaited decision C-401/19 on one of the most critical (and criticized) articles of the Directive (EU) 2019/790, the EU Copyright Directive, article 17 on the liability of Internet service providers.

In a nutshell, Article 17 of the EU Copyright Directive sets out a guidance for online content-sharing service providers, designing the path they have to follow to prevent and/or repress online copyright infringement.  The struggle was to balance the strengthening of the position of authors of copyright protected works, in order to finally recognize to them a fair piece of the pie, and the need to safeguard fundamental rights, especially freedom of expression.

As expected, the debate did not end with the adoption of the EU Copyright Directive. In May 2019, the Polish Government initiated a legal challenge before the Court of Justice of the European Union requesting the annulment of parts of Article 17.  Finally, on April 26th, 2022, the EU Court of Justice confirmed that Article 17 is valid and compatible with the right to freedom of expression, considered that it provides sufficient safeguards to users rights.

But let’s put in order all that has led to this (not unforeseeable) decision.

The liability regime under EU laws: a recap of the previous episodes

Before the adoption of the EU Copyright Directive, the liability regime of Internet Service Providers was mainly regulated by the Directive 2000/31/CE (the EU eCommerce Directive), which excluded any sort of general monitoring obligation for Internet service providers.  Similarly, none of the categories of Internet service providers identified by the eCommerce Directive (i.e. mere conduit, caching and hosting provider) was subject to a general obligation to actively seek facts or circumstances indicating the presence of infringing activities.

In this context, the EU Copyright Directive represents a change of pace in terms of liability regime.

First of all, Article 17, is aimed at regulating the liability of online content-sharing service providers, defined as

provider[s] of information society services 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 [they] organise and promote for profit-making purposes.

The Copyright Directive further states that, in order to communicate to the public or make available to the public protected works, online content-sharing service providers are required to obtain an authorization (e.g. a license) from the right holders.  If no authorization is granted, the only way to escape liability is to prove that they have:

a) made best efforts to obtain an authorization;

b) made best efforts to ensure the unavailability of specific works for which the right holders have provided the service providers with the relevant and necessary information;

c) acted expeditiously to disable access to, or to remove from their websites, the notified works, and made best efforts to prevent their future uploads.

The case C-401/19 on the liability regime of Internet content service providers

Right after the adoption of the EU Copyright Directive, the Republic of Poland asked the Court to annul Article 17(4), letter (b) (i.e. best efforts to ensure unavailability of infringing content) and letter (c) (i.e. best efforts to prevent future uploads of infringing content). In the alternative, should the ECJ consider that those provisions cannot be severed from the other provisions of Article 17 without altering the substance thereof, the claimant asked the Court to annul Article 17 in its entirety.

Such a plea was based on the argument that the current text of Article 17 infringes the right to freedom of expression and information, guaranteed under Article 11 of the Charter of Fundamental Rights of the European Union.

In other terms, the Republic of Poland’s view is that, in order to be exempted from any liability for giving the public access to protected contents uploaded by users, online content-sharing service providers are required, according to Article 17(4) points (b) and (c), to carry out preventive monitoring of all the content which their users wish to upload, meaning to “review all the content uploaded by their users, prior to its dissemination to the public“. In order to do so, OCSSPs have no alternative that using software tools which enable the prior automatic filtering of that content, with the effect that – given that such technologies may be fallacious – there is a serious risk to over-block lawful contents, causing an unjustified limitation of the right to freedom of expression would occur.

In terms of admissibility, the CJEU confirmed the conclusion of the Advocate General, by stating that the challenged letters of Article 17(4) are not severable from the remainder of the article and that, consequently, the article could be annulled only as a whole or not at all. As to the merit, the EU Court of Justice actually recognizes that the kind of activities requested to online content-sharing service providers go well beyond the obligation to act expeditiously to bring to an end the copyright infringements (as requested by the e-Commerce Directive), and, in practice, require online content-sharing service providers to use automatic recognition and filtering tools.

Thus, the Court concludes that

the specific liability regime, established in Article 17(4) of Directive 2019/790 […] entails a limitation on the exercise of the right to freedom of expression and information of users of those content-sharing services, guaranteed in Article 11 of the Charter“, but it also reminds that freedom of expression may be lawfully limited at certain conditions (cfr. Article 52(1) of the Charter).

In this context, the CJEU clarified that, in order to examine whether the limitation of freedom of expression resulting from Article 17(4) is justified, said article cannot be considered in isolation, but it is key to have an all-round vision of the new liability regime.  Thus, the analysis shall include also Article 17(7) to (10) of the Copyright Directive and, more in general, the rational pursued by the establishment of that liability regime, i.e. the protection of the copyright holders.

In a nutshell, the Court ultimately held that the liability system of Article 17 provides for various measures that protect the fundamental rights of users, namely:

  • the EU legislature has already laid down in previous case-law (cfr. para. 67 of the decision) a clear and precise limit on the measures that may be taken or required in implementing the obligations laid down in Article 17(4) (e.g. a filtering system which might not distinguish adequately between unlawful content and lawful content would be incompatible with the freedom of expression);
  • Article 17(7)(2) requires Member States to include in their national laws several exceptions to copyright holder for the purposes of quotations, criticism, reviews, caricatures, parodies, etc.;
  • the obligation to automatically prevent future copyright infringements will apply as long as the rights holders had provided the necessary information to the relevant OCSSPs ;
  • a general monitoring obligation must be excluded, so that the service provider should not be required “to prevent the uploading and making available to the public of content which, in order to be found unlawful, would require an independent assessment of the content by them“;
  • Article 17 clarifies that national laws must include he possibility for users to lodge an appeal against a blocking decision by the service provider.

In conclusion, according to the ECJ, the obligations on online content-sharing service providers provided for by Article 17 have been accompanied by appropriate safeguards by the EU legislature.

The CJEU on the anti blocking mechanism of Internet service providers

It is interesting to notice that with this ruling the Court of Justice examined also one of the most controversial questions in the debate surrounding the implementation of safeguards for users’ rights, i.e. the lawfulness of anti blocking mechanisms.

In this matter, the Court ruled that: “(T)he first and second subparagraphs of Article 17(9) of Directive 2019/790 introduce several procedural safeguards, which are additional to those provided for in Article 17(7) and (8) of that directive, and which protect the right to freedom of expression and information of users of online content-sharing services in cases where, notwithstanding the safeguards laid down in those latter provisions, the providers of those services nonetheless erroneously or unjustifiably block lawful content“.

In other terms, the obligation to protect users rights after their contents have been blocked (as per Article 17(9)) does not replace the obligation to protect users when they are uploading lawful content (as per Article 17(7)), but they are cumulative.

This ruling provides further guidance to Member States that have already implemented the Directive as well as to the ones that have not transposed it yet in their national law. However, it may also entail the need to edit those national laws that are not in line with the conclusion of the Court. By way of example, Member States that have implemented Article 17 in a manner that does not prevent the blocking of legal contents will be forced to modify said provisions.

Given the impact of this ruling on the transposition of the EU Copyright Directive into national law, it is likely that – over the next years – some disputes from a national law perspective will arise and that the Court of Justice will be required to address again the issue of compatibility of the Directive with fundamental rights.

On a similar topic, you can find interesting the article “New YouTube case on the liability of Internet Service Provider (ISP) sets new limitations“.

Photo by Glenn Carstens-Peters on Unsplash

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Lara Mastrangelo

I work in the Intellectual Property & Technology department at the law firm DLA Piper in Italy where I specialized in copyright, trademark, and patent law, as well as any aspect pertaining to intellectual property law.

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