Remote Recording, Cloud Services, and Private Copying: ECJ Rules on Services by Third Parties

By Martin Miernicki

On 29 November 2017, the ECJ gave its opinion in VCAST v. RTI (C-265/16). The court ruled on the compatibility of an online service (offered by VCAST) – which provides users with cloud storage space for free-to-air terrestrial programs of TV organizations – with Directive 2001/29/EC (the so-called Copyright Directive), and in particular with its article 5(2)(b) (the so-called private copying exception). Upon the selection of the user, the service autonomously picks up the television signal and records the indicated content in the “cloud”.

 

Background & questions referred

The case involved questions relating to the private copying exception as well as the concept of the communication to the public, contained in article 3 of the Copyright Directive. The ECJ has repeatedly given its opinion on both matters. Relevant case law includes Padawan v. SGAE (C-467/08), ACI Adam v. Stichting de Thuiskopie (C-435/12), and Copydan Båndkopi v. Nokia Danmark (C-463/12) (on the private copying exception), as well as ITV Broadcasting v. TVCatchup (C-607/11), Reha Training v. GEMA (C-117/15), and AKM v. Zürs.net (C-138/16) (on the communication to the public). In essence, the referring (Italian) court asked the ECJ whether an online cloud service as described above was compatible with the Copyright Directive.

 

The decision of the court

The ECJ reached the same result as proposed by Advocate General (AG) Szpunar in his opinion and held VCAST’s cloud service is incompatible with EU law. First of all, the court recalled its case law and stated that natural persons can benefit from the private copying exception also in situations where the copying services are provided by a third party (para 35). However, in the opinion of the court, the service at issue did not merely assist users in making lawful reproductions but also, by picking up the television signals, provided access to the protected content (para 38). For this reason, the services in question also qualified as a communication to the public within the meaning of article 3 of the Copyright Directive. Since this act required the consent of the rightholders, the provision of the services at issue infringed their exclusive rights and was hence not permissible under EU law.

 

What does the judgment mean?

The judgement gave the court the opportunity to reconfirm and clarify its opinion on two recurring issues of the more recent copyright case law: First, the lawfulness of the source of the reproduction which is made under the private copying exception; second, the concept of the communication to the public. With regard to the former, the ECJ held that the private copying exception cannot be invoked where the third party provides access to the protected content (para 37). In principle, this is in line with the prior case law of the court. With regard to the latter, the court referred to the principles established in ITV Broadcasting, holding that acts of communication to the public – different than the original transmission – carried out under specific technical conditions using different means of transmissions are subject to the right holder’s consent (para 48). In such circumstances, the new public criterion is irrelevant (para 50). Obviously, the principles established in AKM were, as indicated by the AG, not relevant for the court (para 52-56 of the AG’s opinion).

In this light, providers of online services will have to assess whether they merely enable natural persons to obtain private copies or whether they also provide access to protected content. As illustrated by the court’s decision, this requires a delineation of the different exclusive rights involved. In this context, it is noticeable that the answer given to the national court appears to be broader than might be expected from the grounds of the judgement. The ECJ stated that cloud services as described above conflict with the Copyright Directive where the provider “actively [involves] itself in the recording, without the right holder’s consent”. Apparently, one way to be “actively involved” in the recording is to communicate the work to the public, thereby providing access to the copyrighted content. However, other ways are also conceivable. For instance, it is unlikely that the private copying exception applies to cases where the service provider takes the initiative to make reproductions, or defines its object and modalities (para 25 of the AG’s opinion). It will be up to the court to shed further light on such questions in future cases.

Advertisements