CELEX: 62008CJ0403
Satellite broadcasting
Broadcasting of football matches
Reception of the broadcast by means of satellite decoder cards
Satellite decoder cards lawfully placed on the market in one Member State and used in another Member State
Prohibition on marketing and use in a Member State
Visualisation of broadcasts in disregard of the exclusive rights granted
Copyright
Television broadcasting right
Exclusive licences to broadcast in a single Member State
Freedom to provide services
Article 56 TFEU
Competition
Article 101 TFEU
Restriction of competition by object
Protection of services based on conditional access
Illicit device
Directive 98/84/EC
Directive 2001/29/EC
Reproduction of works within the memory of a satellite decoder and on a television screen
Exception to the reproduction right
Communication of works to the public in public houses
Directive 93/83/EEC

These references for a preliminary ruling concern the interpretation of:
–        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, p. 54; ‘the Conditional Access Directive’),
–        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 1993 L 248, p. 15; ‘the Satellite Broadcasting
Directive’),
–        Council Directive 89/552/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 1989 L 298, p. 23), as amended by
Directive 97/36/EC of the European Parliament and of the Council of 30 June 1997 (OJ 1997 L 202, p. 60) (‘the Television without
Frontiers 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 (OJ 2001 L 167, p. 10, corrigendum at OJ 2002 L 6, p. 70; ‘the
Copyright Directive’) and
–        Articles 34 TFEU, 36 TFEU, 56 TFEU and 101 TFEU.
The references have been made in proceedings between Football Association Premier League Ltd (‘FAPL’), NetMed Hellas SA (‘NetMed
Hellas’) and Multichoice Hellas SA (‘Multichoice Hellas’) (collectively ‘FAPL and others’) and QC Leisure, Mr Richardson,
AV Station plc (‘AV Station’), Mr Chamberlain, Mr Madden, SR Leisure Ltd, Mr Houghton and Mr Owen (collectively ‘QC Leisure
and others’) (in Case C-403/08), and between Ms Murphy and Media Protection Services Ltd (‘MPS’) (in Case C‑429/08), concerning
the marketing and use in the United Kingdom of decoding devices which give access to the satellite broadcasting services of
a broadcaster, are manufactured and marketed with that broadcaster’s authorisation, but are used, in disregard of its will,
outside the geographical area for which they have been issued (‘foreign decoding devices’).
I –
Legal context
A –
International law
The Agreement on Trade-Related Aspects of Intellectual Property Rights, which constitutes Annex 1 C to the Agreement establishing
the World Trade Organisation, signed in Marrakech on 15 April 1994, was approved 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) (OJ 1994 L 336, p. 1).
Article 9(1) of the Agreement on Trade-Related Aspects of Intellectual Property Rights provides:
‘Members shall comply with Articles 1 through 21 of the Berne Convention (1971) and the Appendix thereto. However, Members
shall not have rights or obligations under this Agreement in respect of the rights conferred under Article 6
bis
of that Convention or of the rights derived therefrom.’
Article 11(1) of the Berne Convention for the Protection of Literary and Artistic Works (Paris Act of 24 July 1971), as amended
on 28 September 1979 (‘the Berne Convention’), states:
‘Authors of dramatic, dramatico-musical and musical works shall enjoy the exclusive right of authorising:
(i)      the public performance of their works, including such public performance by any means or process;
(ii)      any communication to the public of the performance of their works.’
Article 11
bis
(1) of the Berne Convention provides:
‘Authors of literary and artistic works shall enjoy the exclusive right of authorising:
(i)      the broadcasting of their works or the communication thereof to the public by any other means of wireless diffusion of signs,
sounds or images;
(ii)      any communication to the public by wire or by rebroadcasting of the broadcast of the work, when this communication is made
by an organisation other than the original one;
(iii)      the public communication by loudspeaker or any other analogous instrument transmitting, by signs, sounds or images, the broadcast
of the work.’
The World Intellectual Property Organisation (WIPO) adopted in Geneva on 20 December 1996 the WIPO Performances and Phonograms
Treaty (‘the Performances and Phonograms Treaty’) and the WIPO Copyright Treaty (‘the Copyright Treaty’). Those two treaties
were approved on behalf of the Community by Council Decision 2000/278/EC of 16 March 2000 (OJ 2000 L 89, p. 6).
Article 2(g) of the Performances and Phonograms Treaty provides:
‘For the purposes of this Treaty:
...
(g)      “communication to the public” of a performance or a phonogram means the transmission to the public by any medium, otherwise
than by broadcasting, of sounds of a performance or the sounds or the representations of sounds fixed in a phonogram. For
the purposes of Article 15, “communication to the public” includes making the sounds or representations of sounds fixed in
a phonogram audible to the public.’
Article 15(1) of that treaty states:
‘Performers and producers of phonograms shall enjoy the right to a single equitable remuneration for the direct or indirect
use of phonograms published for commercial purposes for broadcasting or for any communication to the public.’
Article 1(4) of the Copyright Treaty provides that Contracting Parties are to comply with Articles 1 to 21 of and the Appendix
to the Berne Convention.
B –
European Union law
1.           Broadcasting directives
The third recital in the preamble to the Television without Frontiers Directive states:
‘... broadcasts transmitted across frontiers by means of various technologies are one of the ways of pursuing the objectives
of the Community; … measures should be adopted to permit and ensure the transition from national markets to a common programme
production and distribution market and to establish conditions of fair competition without prejudice to the public interest
role to be discharged by the television broadcasting services’.
Recital 21 in the preamble to Directive 97/36 states:
‘… events of major importance for society should, for the purposes of this Directive, meet certain criteria, that is to say
be outstanding events which are of interest to the general public in the European Union or in a given Member State or in an
important component part of a given Member State and are organised in advance by an event organiser who is legally entitled
to sell the rights pertaining to that event’.
Recitals 3, 5, 7, 14, 15 and 17 in the preamble to the Satellite Broadcasting Directive state:
‘(3)      … broadcasts transmitted across frontiers within the Community, in particular by satellite and cable, are one of the most
important ways of pursuing [the] Community objectives, which are at the same time political, economic, social, cultural and
legal;
…
(5)      … holders of rights are exposed to the threat of seeing their works exploited without payment of remuneration or that the
individual holders of exclusive rights in various Member States block the exploitation of their rights; … the legal uncertainty
in particular constitutes a direct obstacle in the free circulation of programmes within the Community;
…
(7)      … the free broadcasting of programmes is further impeded by the current legal uncertainty over whether broadcasting by a satellite
whose signals can be received directly affects the rights in the country of transmission only or in all countries of reception
together; …
…
(14)      … the legal uncertainty regarding the rights to be acquired which impedes cross-border satellite broadcasting should be overcome
by defining the notion of communication to the public by satellite at a Community level; … this definition should at the same
time specify where the act of communication takes place; … such a definition is necessary to avoid the cumulative application
of several national laws to one single act of broadcasting; …
(15)      … the acquisition on a contractual basis of exclusive broadcasting rights should comply with any legislation on copyright
and rights related to copyright in the Member State in which communication to the public by satellite occurs;
…
(17)      … in arriving at the amount of the payment to be made for the rights acquired, the parties should take account of all aspects
of the broadcast, such as the actual audience, the potential audience and the language version’.
Article 1(2)(a) to (c) of the Satellite Broadcasting Directive states:
‘(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 organisation, 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 organisation, 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.’
Article 2 of the Satellite Broadcasting Directive provides:
‘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.’
Recitals 2, 3, 6 and 13 in the preamble to the Conditional Access Directive state:
‘(2)      … the cross-border provision of broadcasting and information society services may contribute, from the individual point of
view, to the full effectiveness of freedom of expression as a fundamental right and, from the collective point of view, to
the achievement of the objectives laid down in the Treaty;
(3)      … the Treaty provides for the free movement of all services which are normally provided for remuneration; … this right, as
applied to broadcasting and information society services, is also a specific manifestation in Community law of a more general
principle, namely freedom of expression as enshrined in Article 10 of the European Convention for the Protection of Human
Rights and Fundamental Freedoms; … that Article explicitly recognises the right of citizens to receive and impart information
regardless of frontiers and … any restriction of that right must be based on due consideration of other legitimate interests
deserving of legal protection;
…
(6)      … the opportunities offered by digital technologies provide the potential for increasing consumer choice and contributing
to cultural pluralism, by developing an even wider range of services within the meaning of Articles [56 TFEU and 57 TFEU];
… the viability of those services will often depend on the use of conditional access in order to obtain the remuneration of
the service provider; … accordingly, the legal protection of service providers against illicit devices which allow access
to these services free of charge seems necessary in order to ensure the economic viability of the services;
…
(13)      … it seems necessary to ensure that Member States provide appropriate legal protection against the placing on the market,
for direct or indirect financial gain, of an illicit device which enables or facilitates without authority the circumvention
of any technological measures designed to protect the remuneration of a legally provided service’.
Article 2 of the Conditional Access Directive provides:
‘For the purposes of this Directive:
(a)
protected service
shall mean any of the following services, where provided against remuneration and on the basis of conditional access:
–        television broadcasting, as defined in Article 1(a) of [the Television without Frontiers Directive],
…
(b)
conditional access
shall mean any technical measure and/or arrangement whereby access to the protected service in an intelligible form is made
conditional upon prior individual authorisation;
(c)
conditional access device
shall mean any equipment or software designed or adapted to give access to a protected service in an intelligible form;
…
(e)
illicit device
shall mean any equipment or software designed or adapted to give access to a protected service in an intelligible form without
the authorisation of the service provider;
(f)
field coordinated by this Directive
shall mean any provision relating to the infringing activities specified in Article 4.’
As set out in Article 3 of the Conditional Access Directive:
‘1.      Each Member State shall take the measures necessary to prohibit on its territory the activities listed in Article 4, and to
provide for the sanctions and remedies laid down in Article 5.
2.      Without prejudice to paragraph 1, Member States may not:
(a)      restrict the provision of protected services, or associated services, which originate in another Member State; or
(b)      restrict the free movement of conditional access devices;
for reasons falling within the field coordinated by this Directive.’
Article 4 of the Conditional Access Directive states:
‘Member States shall prohibit on their territory all of the following activities:
(a)      the manufacture, import, distribution, sale, rental or possession for commercial purposes of illicit devices;
(b)      the installation, maintenance or replacement for commercial purposes of an illicit device;
(c)      the use of commercial communications to promote illicit devices.’
2.           Intellectual property directives
Recitals 9, 10, 15, 20, 23, 31 and 33 in the preamble to the Copyright Directive state:
‘(9)      Any harmonisation of copyright and related rights must take as a basis a high level of protection, since such rights are crucial
to intellectual creation. …
(10)      If authors or performers are to continue their creative and artistic work, they have to receive an appropriate reward for
the use of their work …
…
(15)      … This Directive … serves to implement a number of the new international obligations [arising from the Copyright Treaty and
the Performances and Phonograms Treaty].
…
(20)      This Directive is based on principles and rules already laid down in the Directives currently in force in [the area of intellectual
property], in particular [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 1992 L 346, p. 61)], 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.
...
(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.
…
(31)      A fair balance of rights and interests between the different categories of rightholders, as well as between the different
categories of rightholders and users of protected subject-matter must be safeguarded …
…
(33)      The exclusive right of reproduction should be subject to an exception to allow certain acts of temporary reproduction, which
are transient or incidental reproductions, forming an integral and essential part of a technological process and 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. The acts of reproduction concerned should have no separate economic
value on their own. To the extent that they meet these conditions, 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 rightholder or not restricted by law.’
As set out in Article 2(a) and (e) of the Copyright Directive:
‘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;
…
(e)      for broadcasting organisations, of fixations of their broadcasts, whether those broadcasts are transmitted by wire or over
the air, including by cable or satellite.’
Article 3(1) of the Copyright Directive provides:
‘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.’
Article 5 of the Copyright Directive states:
‘1.      Temporary acts of reproduction referred to in Article 2, which are transient or incidental, which are an integral and essential
part of a technological process and the sole purpose of which 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.
…
3.      Member States may provide for exceptions or limitations to the rights provided for in Articles 2 and 3 in the following cases:
…
(i)      incidental inclusion of a work or other subject-matter in other material;
…
5.      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 rightholder.’
According to recital 5 in the preamble to 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 2006 L 376, p. 28; ‘the Related Rights Directive’):
‘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. …’
Under Article 7(2) of the Related Rights Directive, Member States are to 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.
Article 8(3) of the Related Rights Directive is worded as follows:
‘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.’
Recital 5 in the preamble to, and Articles 7(2) and 8(3) of, the Related Rights Directive essentially reproduce the seventh
recital in the preamble to, and Articles 6(2) and 8(3) of, Directive 92/100.
C –
National legislation
Section 297(1) of the Copyright, Designs and Patents Act 1988 (‘the Copyright, Designs and Patents Act’) provides:
‘A person who dishonestly receives a programme included in a broadcasting  service provided from a place in the United Kingdom
with intent to avoid payment of any charge applicable to the reception of the programme commits an offence and is liable on
summary conviction to a fine not exceeding level 5 on the standard scale.’
Section 298 of the Copyright, Designs and Patents Act states:
‘(1)      A person who–
(a)      makes charges for the reception of programmes included in a broadcasting  service provided from a place in the United Kingdom
or any other Member State,
(b)      sends encrypted transmissions of any other description from a place in the United Kingdom or any other Member State, or
…
is entitled to the following rights and remedies.
(2)      He has the same rights and remedies against a person–
(a)      who–
(i)      makes, imports, distributes, sells or lets for hire, offers or exposes for sale or hire, or advertises for sale or hire,
(ii)      has in his possession for commercial purposes, or
(iii) instals, maintains or replaces for commercial purposes,
any apparatus designed or adapted to enable or assist persons to access the programmes or other transmissions or circumvent
conditional access technology related to the programmes or other transmissions when they are not entitled to do so, …
…
as a copyright owner has in respect of an infringement of copyright.
…’
II –
The disputes in the main proceedings and the questions referred for a preliminary ruling
FAPL runs the Premier League, the leading professional football league competition for football clubs in England.
FAPL’s activities include organising the filming of Premier League matches and exercising in their regard television broadcasting
rights, that is to say, rights to make the audiovisual content of sporting events available to the public by means of television
broadcasting (‘broadcasting rights’).
A –
Licensing of the broadcasting rights for Premier League matches
FAPL grants licences in respect of those broadcasting rights for live transmission, on a territorial basis and for three-year
terms. In that regard, FAPL’s strategy is to bring the competition to viewers throughout the world while maximising the value
of the rights to its members, the clubs.
Those rights are thus awarded to broadcasters under an open competitive tender procedure which begins with the invitation
to tenderers to submit bids on a global, regional or territorial basis. Demand then determines the territorial basis on which
FAPL sells its international rights. However, as a rule, that basis is national since there is only a limited demand from
bidders for global or pan-European rights, given that broadcasters usually operate on a territorial basis and serve the domestic
market either in their own country or in a small cluster of neighbouring countries with a common language.
Where a bidder wins, for an area, a package of broadcasting rights for the live transmission of Premier League matches, it
is granted the exclusive right to broadcast them in that area. This is necessary, according to FAPL, in order to realise the
optimum commercial value of all of the rights, broadcasters being prepared to pay a premium to acquire that exclusivity as
it allows them to differentiate their services from those of their rivals and therefore enhances their ability to generate
revenue.
In order to protect the territorial exclusivity of all broadcasters, they each undertake, in their licence agreement with
FAPL, to prevent the public from receiving their broadcasts outside the area for which they hold the licence. This requires,
first, each broadcaster to ensure that all of its broadcasts capable of being received outside that territory – in particular
those transmitted by satellite – are encrypted securely and cannot be received in unencrypted form. Second, broadcasters must
ensure that no device is knowingly authorised so as to permit anyone to view their transmissions outside the territory concerned.
Therefore, broadcasters are in particular prohibited from supplying decoding devices that allow their broadcasts to be decrypted
for the purpose of being used outside the territory for which they hold the licence.
B –
Broadcasting of Premier League matches
As part of its activities, FAPL is also responsible for organising the filming of Premier League matches and transmission
of the signal to the broadcasters that have the rights for those matches.
For this purpose, the images and ambient sound captured at the match are transmitted to a production facility which adds logos,
video sequences, on-screen graphics, music and English commentary.
The signal is sent, by satellite, to a broadcaster which adds its own logo and possibly some commentary. The signal is then
compressed and encrypted, and then transmitted by satellite to subscribers, who receive the signal using a satellite dish.
The signal is, finally, decrypted and decompressed in a satellite decoder which requires a decoding device such as a decoder
card for its operation.
In Greece, the holder of the sub-licence to broadcast Premier League matches is NetMed Hellas. The matches are broadcast via
satellite on SuperSport channels on the NOVA platform, the owner and operator of which is Multichoice Hellas.
Viewers who have subscribed to the NOVA satellite package have access to those channels. Every subscriber must have been able
to provide a name, a Greek address and a Greek telephone number. Subscriptions can be taken out for private or commercial
purposes.
In the United Kingdom, at the material time the licensee for live Premier League broadcasting was BSkyB Ltd. Where a natural
or legal person wishes to screen Premier League matches in the United Kingdom, he may take out a commercial subscription from
that company.
However, in the United Kingdom certain restaurants and bars have begun to use foreign decoding devices to access Premier League
matches. They buy from a dealer a card and a decoder box which allow them to receive a satellite channel broadcast in another
Member State, such as the NOVA channels, the subscription to which is less expensive than BSkyB Ltd’s subscription. Those
decoder cards have been manufactured and marketed with the authorisation of the service provider, but they are subsequently
used in an unauthorised manner, since the broadcasters have made their issue subject to the condition – in accordance with
the undertakings set out in paragraph 35 of the present judgment – that customers do not use them outside the national territory
concerned.
FAPL has taken the view that such activities are harmful to its interests because they undermine the exclusivity of the rights
granted by licence in a given territory and hence the value of those rights. Indeed, according to FAPL, the broadcaster selling
the cheapest decoder cards has the potential to become, in practice, the broadcaster at European level, which would result
in broadcast rights in the European Union having to be granted at European level. This would lead to a significant loss in
revenue for both FAPL and the broadcasters, and would thus undermine the viability of the services that they provide.
Consequently, FAPL and others have brought, in Case C-403/08, what they consider to be three test cases before the High Court
of Justice of England and Wales, Chancery Division. Two of the actions are against QC Leisure, Mr Richardson, AV Station and
Mr Chamberlain, suppliers to public houses of equipment and satellite decoder cards that enable the reception of programmes
of foreign broadcasters, including NOVA, which transmit live Premier League matches.
The third action is brought against Mr Madden, SR Leisure Ltd, Mr Houghton and Mr Owen, licensees or operators of four public
houses that have screened live Premier League matches by using a foreign decoding device.
FAPL and others allege that those persons are infringing their rights protected by section 298 of the Copyright, Designs and
Patents Act by trading in or, in the case of the defendants in the third action, being in possession for commercial purposes
of foreign decoding devices designed or adapted to give access to the services of FAPL and others without authorisation.
In addition, the defendants in the third action have allegedly infringed their copyrights by creating copies of the works
in the internal operation of the satellite decoder and by displaying the works on screen, as well as by performing, playing
or showing the works in public and communicating them to the public.
Furthermore, QC Leisure and AV Station have allegedly infringed the copyrights by authorising the acts perpetrated by the
defendants in the third action, as well as by other persons to whom they have supplied decoder cards.
In the view of QC Leisure and others, the actions are unfounded because they are not using pirate decoder cards, all of the
cards in question having been issued and placed upon the market, in another Member State, by the relevant satellite broadcaster.
In Case C‑429/08, Ms Murphy, manager of a public house, procured a NOVA decoder card to screen Premier League matches.
Agents from MPS, a body mandated by FAPL to conduct a campaign of prosecutions against public house managers using foreign
decoding devices, found that Ms Murphy was receiving, in her public house, broadcasts of Premier League matches transmitted
by NOVA.
Consequently, MPS brought Ms Murphy before Portsmouth Magistrates’ Court, which convicted her of two offences under section
297(1) of the Copyright, Designs and Patents Act on the ground that she had dishonestly received a programme included in a
broadcasting service provided from a place in the United Kingdom with intent to avoid payment of any charge applicable to
the reception of the programme.
After Portsmouth Crown Court had essentially dismissed her appeal, Ms Murphy brought an appeal by way of case stated before
the High Court of Justice, taking a position similar to that adopted by QC Leisure and others.
In those circumstances, the High Court of Justice of England and Wales, Chancery Division, decided to stay proceedings and
to refer the following questions to the Court for a preliminary ruling in Case C-403/08:
‘(1)      (a)   Where a conditional access device is made by or with the consent of a service provider and sold subject to a limited authorisation
to use the device only to gain access to the protected service in particular circumstances, does that device become an “illicit
device” within the meaning of Article 2(e) of [the Conditional Access Directive] if it is used to give access to that protected
service in a place or in a manner or by a person outside the authorisation of the service provider?
(b)      What is the meaning of “designed or adapted” within Article 2(e) of the Directive?
(2)      When a first service provider transmits programme content in encoded form to a second service provider who broadcasts that
content on the basis of conditional access, what factors are to be taken into account in determining whether the interests
of the first provider of a protected service are affected, within the meaning of Article 5 of [the Conditional Access Directive]?
In particular:
Where a first undertaking transmits programme content (comprising visual images, ambient sound and English commentary) in
encoded form to a second undertaking which in turn broadcasts to the public the programme content (to which it has added its
logo and, on occasion, an additional audio commentary track):
(a)      Does the transmission by the first undertaking constitute a protected service of “television broadcasting” within the meaning
of Article 2(a) of [the Conditional Access Directive] and Article 1(a) of [the Television without Frontiers Directive]?
(b)      Is it necessary for the first undertaking to be a broadcaster within the meaning of Article 1(b) of [the Television without
Frontiers Directive] in order to be considered as providing a protected service of “television broadcasting” within the first
indent of Article 2(a) of [the Conditional Access Directive]?
(c)      Is Article 5 of [the Conditional Access Directive] to be interpreted as conferring a civil right of action on the first undertaking
in respect of illicit devices which give access to the programme as broadcast by the second undertaking, either:
(i)      because such devices are to be regarded as giving access via the broadcast signal to the first undertaking’s own service;
or
(ii)      because the first undertaking is the provider of a protected service whose interests are affected by an infringing activity
(because such devices give unauthorised access to the protected service provided by the second undertaking)?
(d)      Is the answer to (c) affected by whether the first and second service providers use different decryption systems and conditional
access devices?
(3)      Does “possession for commercial purposes” in Article 4(a) of the [Conditional Access] Directive relate only to possession
for the purposes of commercial dealings in (for example, sales of) illicit devices, or does it extend to the possession of
a device by an end user in the course of a business of any kind?
(4)      Where sequential fragments of a film, musical work or sound recording (in this case frames of digital video and audio) are
created (i) within the memory of a decoder or (ii) in the case of a film on a television screen, and the whole work is reproduced
if the sequential fragments are considered together but only a limited number of fragments exist at any point in time:
(a)      Is the question of whether those works have been reproduced in whole or in part to be determined by the rules of national
copyright law relating to what constitutes an infringing reproduction of a copyright work, or is it a matter of interpretation
of Article 2 of [the Copyright Directive]?
(b)      If it is a matter of interpretation of Article 2 of [the Copyright Directive], should the national court consider all of the
fragments of each work as a whole, or only the limited number of fragments which exist at any point in time? If the latter,
what test should the national court apply to the question of whether the works have been reproduced in part within the meaning
of that Article?
(c)      Does the reproduction right in Article 2 extend to the creation of transient images on a television screen?
(5)      (a)   Are transient copies of a work created within a satellite television decoder box or on a television screen linked to the decoder
box, and whose sole purpose is to enable a use of the work not otherwise restricted by law, to be regarded as having “independent
economic significance” within the meaning of Article 5(1) of [the Copyright Directive] by reason of the fact that such copies
provide the only basis upon which the rights holder can extract remuneration for the use of his rights?
(b)      Is the answer to Question 5(a) affected by (i) whether the transient copies have any inherent value; or (ii) whether the transient
copies comprise a small part of a collection of works and/or other subject-matter which otherwise may be used without infringement
of copyright; or (iii) whether the exclusive licensee of the rights holder in another Member State has already received remuneration
for use of the work in that Member State?
(6)      (a)   Is a copyright work communicated to the public by wire or wireless means within the meaning of Article 3 of [the Copyright
Directive] where a satellite broadcast is received at a commercial premises (for example a bar) and communicated or shown
at those premises via a single television screen and speakers to members of the public present in those premises?
(b)      Is the answer to Question 6(a) affected if:
(i)      the members of the public present constitute a new public not contemplated by the broadcaster (in this case because a domestic
decoder card for use in one Member State is used for a commercial audience in another Member State)?
(ii)      the members of the public are not a paying audience according to national law?
(iii) the television broadcast signal is received by an aerial or satellite dish on the roof of or adjacent to the premises where
the television is situated?
(c)      If the answer to any part of (b) is yes, what factors should be taken into account in determining whether there is a communication
of the work which has originated from a place where members of the audience are not present?
(7)      Is it compatible with [the Satellite Broadcasting Directive] or with Articles 28 and 30 or 49 of the EC Treaty if national
copyright law provides that when transient copies of works included in a satellite broadcast are created inside a satellite
decoder box or on a television screen, there is an infringement of copyright under the law of the country of reception of
the broadcast? Does it affect the position if the broadcast is decoded using a satellite decoder card which has been issued
by the provider of a satellite broadcasting service in another Member State on the condition that the satellite decoder card
is only authorised for use in that other Member State?
(8)      (a)   If the answer to [Question 1] is that a conditional access device made by or with the consent of the service provider becomes
an “illicit device” within the meaning of Article 2(e) of [the Conditional Access Directive] when it is used outside the scope
of the authorisation of the service provider to give access to a protected service, what is the specific subject-matter of
the right by reference to its essential function conferred by the Conditional Access Directive?
(b)      Do Articles 28 or 49 of the EC Treaty preclude enforcement of a provision of national law in a first Member State which makes
it unlawful to import or sell a satellite decoder card which has been issued by the provider of a satellite broadcasting service
in another Member State on the condition that the satellite decoder card is only authorised for use in that other Member State?
(c)      Is the answer affected if the satellite decoder card is authorised only for private and domestic use in that other Member
State but used for commercial purposes in the first Member State?
(9)      Do Articles 28 and 30 or 49 of the EC Treaty preclude enforcement of a provision of national copyright law which makes it
unlawful to perform or play in public a musical work where that work is included in a protected service which is accessed[,]
and [that work is] played in public[,] by use of a satellite decoder card where that card has been issued by the service provider
in another Member State on the condition that the decoder card is only authorised for use in that other Member State? Does
it make a difference if the musical work is an unimportant element of the protected service as a whole and the showing or
playing in public of the other elements of the service are not prevented by national copyright law?
(10)      Where a programme content provider enters into a series of exclusive licences each for the territory of one or more Member
States under which the broadcaster is licensed to broadcast the programme content only within that territory (including by
satellite) and a contractual obligation is included in each licence requiring the broadcaster to prevent its satellite decoder
cards which enable reception of the licensed programme content from being used outside the licensed territory, what legal
test should the national court apply and what circumstances should it take into consideration in deciding whether the contractual
restriction contravenes the prohibition imposed by Article 81(1) [EC]?
In particular:
(a)      must Article 81(1) [EC] be interpreted as applying to that obligation by reason only of it being deemed to have the object
of preventing, restricting or distorting competition?
(b)      if so, must it also be shown that the contractual obligation appreciably prevents, restricts or distorts competition in order
to come within the prohibition imposed by Article 81(1) [EC]?’
In Case C-429/08, the High Court of Justice of England and Wales, Queen’s Bench Division (Administrative Court), decided to
stay proceedings and to refer the following questions to the Court for a preliminary ruling:
‘(1)      In what circumstances is a conditional access device an “illicit device” within the meaning of Article 2(e) of [the Conditional
Access Directive]?
(2)      In particular, is a conditional access device an “illicit device” if it is acquired in circumstances where:
(i)      the conditional access device was made by or with the consent of a service provider and originally supplied subject to limited
contractual authorisation to use the device to gain access to a protected service only in a first Member State and was used
to gain access to that protected service received in another Member State? and/or
(ii)      the conditional access device was made by or with the consent of a service provider and was originally procured and/or enabled
by the provision of a false name and residential address in the first Member State thereby overcoming contractual territorial
restrictions imposed on the export of such devices for use outside the first Member State? and/or
(iii) the conditional access device was made by or with the consent of a service provider and was originally supplied subject to
a contractual condition that it be used only for domestic or private use rather than commercial use (for which a higher subscription
charge is payable), but was used in the United Kingdom for commercial purposes, namely showing live football broadcasts in
a public house?
(3)      If the answer to any part of Question 2 is “no”, does Article 3(2) of that Directive preclude a Member State from invoking
a national law that prevents use of such conditional access devices in the circumstances set out in Question 2 above?
(4)      If the answer to any part of Question 2 is “no”, is Article 3(2) of that Directive invalid:
(a)      for the reason that it is discriminatory and/or disproportionate; and/or
(b)      for the reason that it conflicts with free movement rights under the Treaty; and/or
(c)      for any other reason?
(5)      If the answer to Question 2 is “yes”, are Articles 3(1) and 4 of that Directive invalid for the reason that they purport to
require the Member States to impose restrictions on the importation from other Member States of and other dealings with “illicit
devices” in circumstances where those devices may lawfully be imported and/or used to receive cross-border satellite broadcasting
services by virtue of the rules on the free movement of goods under Articles 28 and 30 of the EC Treaty and/or the freedom
to provide and receive services under Article 49 of the EC Treaty?
(6)      Do Articles 28, 30 and/or 49 EC preclude enforcement of a national law (such as section 297 of the [Copyright, Designs and
Patents Act]) which makes it a criminal offence dishonestly to receive a programme included in a broadcasting service provided
from a place in the United Kingdom with intent to avoid payment of any charge applicable to the reception of the programme,
in any of the following circumstances:
(i)      where the conditional access device was made by or with the consent of a service provider and originally supplied subject
to limited contractual authorisation to use the device to gain access to a protected service only in a first Member State
and was used to gain access to that protected service received in another Member State (in this case the UK)? and/or
(ii)      where the conditional access device was made by or with the consent of a service provider and was originally procured and/or
enabled by the provision of a false name and residential address in the first Member State thereby overcoming contractual
territorial restrictions imposed on the export of such devices for use outside the first Member State? and/or
(iii) where the conditional access device was made by or with the consent of a service provider and was originally supplied subject
to a contractual condition that it be used only for domestic or private use rather than commercial use (for which a higher
subscription charge is payable), but was used in the United Kingdom for commercial purposes, namely showing live football
broadcasts in a public house?
(7)      Is enforcement of the national law in question in any event precluded on the ground of discrimination contrary to Article
12 EC or otherwise, because the national law applies to programmes included in a broadcasting service provided from a place
in the United Kingdom but not from any other Member State?
(8)      Where a programme content provider enters into a series of exclusive licences each for the territory of one or more Member
States under which the broadcaster is licensed to broadcast the programme content only within that territory (including by
satellite) and a contractual obligation is included in each licence requiring the broadcaster to prevent its satellite decoder
cards which enable reception of the licensed programme content from being used outside the licensed territory, what legal
test should the national court apply and what circumstances should it take into consideration in deciding whether the contractual
restriction contravenes the prohibition imposed by Article 81(1) [EC]?
In particular:
(a)      must Article 81(1) [EC] be interpreted as applying to that obligation by reason only of it being deemed to have the object
of preventing, restricting or distorting competition?
(b)      if so, must it also be shown that the contractual obligation appreciably prevents, restricts or distorts competition in order
to come within the prohibition imposed by Article 81(1) [EC]?’
By order of the President of the Court of 3 December 2008, Cases C-403/08 and C-429/08 were joined for the purposes of the
written and oral procedure and the judgment.
III –
Consideration of the questions referred
A –
Rules relating to the reception of encrypted broadcasts from other Member States
1.           Introductory remarks
First of all, it should be made clear that the present cases concern only the satellite broadcasting of Premier League matches
to the public by broadcasting organisations, such as Multichoice Hellas. Thus, the only part of the audiovisual communication
that is relevant here is the part which consists in the transmission of those broadcasts by the broadcasting organisations
to the public in accordance with Article 1(2)(a) and (b) of the Satellite Broadcasting Directive, that operation being carried
out from the Member State where the programme-carrying signals are introduced into a chain of satellite communication (‘the
Member State of broadcast’), in this instance the Hellenic Republic in particular.
On the other hand, the upstream part of the communication, between FAPL and those broadcasters, which consists in the transmission
of audiovisual data containing those matches, is irrelevant here, that communication indeed being capable of being effected
by means of telecommunication other than those used by the parties to the main proceedings.
Second, it is apparent from the documents before the Court that, under the licence agreements between FAPL and the broadcasters
concerned, the broadcasts in question are intended solely for the public of the Member State of broadcast and that those broadcasters
must therefore ensure that their satellite transmissions can be received only in that State. Consequently, the broadcasters
must encrypt their transmissions and supply decoding devices only to persons resident in the Member State of broadcast.
Finally, it is not in dispute that proprietors of public houses use such decoding devices outside that Member State and therefore
they use them in disregard of the broadcasters’ will.
It is in this context that the referring courts inquire, by the first part of their questions, whether such use of decoding
devices falls within the Conditional Access Directive and what its effect is on that use. Next, should this aspect not be
harmonised by the Conditional Access Directive, they seek to ascertain whether Articles 34 TFEU, 36 TFEU, 56 TFEU and 101
TFEU preclude national legislation and licence agreements that prohibit the use of foreign decoding devices.
2.           Conditional Access Directive
a)            Interpretation of ‘illicit device’ within the meaning of Article 2(e) of the Conditional Access Directive (Question 1 in
Case C-403/08 and Questions 1 and 2 in Case C‑429/08)
By these questions, the referring courts ask, in essence, whether ‘illicit device’ within the meaning of Article 2(e) of the
Conditional Access Directive must be interpreted as also covering foreign decoding devices, including those procured or enabled
by the provision of a false name and address and those used in breach of a contractual limitation permitting their use only
for private purposes.
First, Article 2(e) of the Conditional Access Directive defines ‘illicit device’ as any equipment or software ‘designed’ or
‘adapted’ to give access to a protected service in an intelligible form without the authorisation of the service provider.
This wording is thus limited solely to equipment which has been the subject of manual or automated operations prior to commencement
of its use and enables protected services to be received without the consent of providers of those services. Consequently,
the wording refers only to equipment that has been manufactured, manipulated, adapted or readjusted without the authorisation
of the service provider, and it does not cover the use of foreign decoding devices.
Second, recitals 6 and 13 in the preamble to the Conditional Access Directive, which contain explanation of the concept of
‘illicit device’, refer to the need to combat both illicit devices ‘which allow access … free of charge’ to protected services
and the placing on the market of illicit devices which enable or facilitate ‘without authority the circumvention of any technological
measures’ designed to protect the remuneration of a legally provided service.
Neither of those categories covers foreign decoding devices, foreign decoding devices procured or enabled by the provision
of a false name and address or foreign decoding devices which have been used in breach of a contractual limitation permitting
their use only for private purposes. All those devices are manufactured and placed on the market with the authorisation of
the service provider, they do not allow access free of charge to protected services and they do not enable or facilitate the
circumvention of a technological measure designed to protect the remuneration of those services, given that remuneration has
been paid in the Member State where they have been placed on the market.
In light of the foregoing, the answer to the questions referred is that ‘illicit device’ within the meaning of Article 2(e)
of the Conditional Access Directive must be interpreted as not covering foreign decoding devices, foreign decoding devices
procured or enabled by the provision of a false name and address or foreign decoding devices which have been used in breach
of a contractual limitation permitting their use only for private purposes.
b)           Interpretation of Article 3(2) of the Conditional Access Directive (Question 3 in Case C-429/08)
By this question, the referring court asks, in essence, whether Article 3(2) of the Conditional Access Directive precludes
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 which have been used in breach of a contractual limitation permitting their use only
for private purposes.
Under Article 3(2) of the Conditional Access Directive, Member States may not restrict the free movement of protected services
and conditional access devices for reasons falling within the field coordinated by that directive, without prejudice to the
obligations flowing from Article 3(1).
Article 3(1) of the Conditional Access Directive imposes obligations in the field coordinated by the directive – which is
defined in Article 2(f) as any provision relating to the infringing activities specified in Article 4 – by requiring in particular
that the Member States prohibit the activities listed in Article 4.
However, Article 4 concerns only activities which are infringing because they result in the use of illicit devices within
the meaning of the directive.
Foreign decoding devices, including those procured or enabled by the provision of a false name and address and those used
in breach of a contractual limitation permitting their use only for private purposes, do not constitute such illicit devices,
as is apparent from paragraphs 63 to 67 of the present judgment.
Consequently, neither activities resulting in the use of those devices nor national legislation prohibiting those activities
fall within the field coordinated by the Conditional Access Directive.
Accordingly, the answer to the question referred is that Article 3(2) of the Conditional Access Directive 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.
c)           The other questions concerning the Conditional Access Directive
In light of the answers to Question 1 in Case C‑403/08 and to Questions 1, 2 and 3 in Case C-429/08, there is no need to examine
Questions 2, 3 and 8(a) in Case C‑403/08 or Questions 4 and 5 in Case C‑429/08.
3.           Rules of the FEU Treaty concerning free movement of goods and services
a)           Prohibition on the import, sale and use of foreign decoding devices (Question 8(b) and the first part of Question 9 in Case
C-403/08 and Question 6(i) in Case C-429/08)
By these questions, the referring courts ask in essence whether, on a proper construction of Articles 34 TFEU, 36 TFEU and
56 TFEU, those articles 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.
i)           Identification of the applicable provisions
National legislation such as that at issue in the main proceedings concerns both the cross-border provision of encrypted broadcasting
services and the movement within the European Union of foreign decoding devices which enable those services to be decoded.
In those circumstances, the question arises whether the legislation must be examined from the point of view of the freedom
to provide services or from that of the free movement of goods.
It is clear from  the case-law that, where a national measure relates to both the free movement of goods and the freedom to
provide services, the Court will in principle examine it in the light of one only of those two fundamental freedoms if it
is apparent that one of them is entirely secondary in relation to the other and may be considered together with it (see Case
C‑275/92
Schindler
[1994] ECR I‑1039, paragraph 22, and Case C-108/09
Ker-Optika
[2010] ECR I-0000, paragraph 43).
However, in the field of telecommunications, those two aspects are often intimately linked, one not capable of being regarded
as entirely secondary in relation to the other. That is so in particular where national legislation governs the supply of
telecommunications equipment, such as decoding devices, in order to specify the requirements which that equipment must meet
or to lay down the conditions under which it can be marketed, so that it is appropriate, in such a case, to examine both fundamental
freedoms simultaneously (see, to this effect, Case C‑390/99
Canal Satélite Digital
[2002] ECR I-607, paragraphs 29 to 33).
That said, where legislation concerns, in this field, an activity in respect of which the services provided by the economic
operators are particularly prominent, whilst the supply of telecommunications equipment is related thereto in only a purely
secondary manner, it is appropriate to examine that activity in the light of the freedom to provide services alone.
That is so, inter alia, where making such equipment available constitutes only a specific step in the organisation or operation
of a service and that activity does not display an end in itself, but is intended to enable the service to be obtained. In
those circumstances, the activity which consists in making such equipment available cannot be assessed independently of the
activity linked to the service to which that first activity relates (see, by analogy,
Schindler
, paragraphs 22 and 25).
In the main proceedings, the national legislation is not directed at decoding devices in order to determine the requirements
which they must meet or to lay down conditions under which they can be marketed. It deals with them only as an instrument
enabling subscribers to obtain the encrypted broadcasting services.
Given that the national legislation thus concerns, above all, the freedom to provide services, whilst the free movement of
goods aspect is entirely secondary in relation to the freedom to provide services, that legislation must be assessed from
the point of view of the latter freedom.
It follows that such legislation must be examined in the light of Article 56 TFEU.
ii)        Existence of a restriction on the freedom to provide services
Article 56 TFEU requires the abolition of all restrictions on the freedom to provide services, even if those restrictions
apply without distinction to national providers of services and to those from other Member States, when they are liable to
prohibit, impede or render less advantageous the activities of a service provider established in another Member State where
it lawfully provides similar services. Moreover, the freedom to provide services is for the benefit of both providers and
recipients of services (see Case C-42/07
Liga Portuguesa de Futebol Profissional and Bwin International
[2009] ECR I‑7633, paragraph 51 and the case-law cited).
In the main proceedings, the national legislation prohibits foreign decoding devices – which give access to satellite broadcasting
services from another Member State – from being imported into, and sold and used in, national territory.
Given that access to satellite transmission services such as those at issue in the main proceedings requires possession of
such a device whose supply is subject to the contractual limitation that it may be used only in the Member State of broadcast,
the national legislation concerned prevents those services 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.
It is true that the actual origin of the obstacle to the reception of such services is to be found in the contracts concluded
between the broadcasters and their customers, which in turn reflect the territorial restriction clauses included in contracts
concluded between those broadcasters and the holders of intellectual property rights. However, as the legislation confers
legal protection on those restrictions and requires them to be complied with on pain of civil-law and pecuniary sanctions,
it itself restricts the freedom to provide services.
Consequently, the legislation concerned constitutes a restriction on the freedom to provide services that is prohibited by
Article 56 TFEU unless it can be objectively justified.
iii)        Justification of a restriction on the freedom to provide services by an objective of protecting intellectual property rights
–       Observations submitted to the Court
FAPL and others, MPS and the United Kingdom, French and Italian Governments submit that the restriction underlying the legislation
at issue in the main proceedings can be justified in light of the rights of holders of intellectual property rights, because
it is necessary in order to ensure that those holders remain appropriately remunerated; this requires that they be entitled
to demand appropriate remuneration for the use of their works or other subject-matter in each Member State and to grant territorial
exclusivity in respect of their use.
Those parties contend in particular in this regard that, if there were no protection of that territorial exclusivity, the
holder of intellectual property rights would no longer be able to obtain appropriate licence fees from the broadcasters given
that the live broadcast of sporting events would have lost part of its value. Broadcasters are not interested in acquiring
licences outside the territory of the Member State of broadcast. Acquiring licences for all the national territories where
potential customers reside is not financially attractive, because of the extremely high cost of such licences. Thus, broadcasters
acquire licences to transmit the works concerned in the territory of a single Member State. They are prepared to pay a substantial
premium provided that they are guaranteed territorial exclusivity, because that exclusivity enables them to stand out from
their competitors and thereby to attract additional customers.
QC Leisure and others, Ms Murphy, the Commission and the EFTA Surveillance Authority contend that such a restriction on the
freedom to provide broadcasting services cannot be justified, because it results in a partitioning of the internal market.
–       The Court’s response
When examining the justification for a restriction, such as that at issue in the main proceedings, it is to be recalled that
a restriction on fundamental freedoms guaranteed by the Treaty cannot be justified unless it serves overriding reasons in
the public interest, is suitable for securing the attainment of the public interest objective which it pursues and does not
go beyond what is necessary in order to attain it (see, to this effect, Case C-222/07
UTECA
[2009] ECR I‑1407, paragraph 25 and the case-law cited).
As regards the justifications which are capable of being accepted, it is apparent from settled case-law that such a restriction
may be justified, in particular, by overriding reasons in the public interest which consist in the protection of intellectual
property rights (see, to this effect, Case 62/79
Coditel and Others
(‘
Coditel I
’) [1980] ECR 881, paragraphs 15 and 16, and Joined Cases 55/80 and 57/80
Musik-Vertrieb membran and K-tel International
[1981] ECR 147, paragraphs 9 and 12).
It should thus be determined at the outset whether FAPL can invoke such rights capable of justifying the fact that the national
legislation at issue in the main proceedings establishes in its favour protection which constitutes a restriction on the freedom
to provide services.
FAPL cannot claim copyright in the Premier League matches themselves, as they cannot be classified as works.
To be so classified, the subject-matter concerned would have to be original in the sense that it is its author’s own intellectual
creation (see, to this effect, Case C‑5/08
Infopaq International
[2009] ECR I‑6569, paragraph 37).
However, sporting events cannot be regarded as intellectual creations classifiable as works within the meaning of the Copyright
Directive. That applies in particular to football matches, which are subject to rules of the game, leaving no room for creative
freedom for the purposes of copyright.
Accordingly, those events cannot be protected under copyright. It is, moreover, undisputed that European Union law does not
protect them on any other basis in the field of intellectual property.
None the less, sporting events, as such, have a unique and, to that extent, original character which can transform them into
subject-matter that is worthy of protection comparable to the protection of works, and that protection can be granted, where
appropriate, by the various domestic legal orders.
In this regard, it is to be noted that, under the second subparagraph of Article 165(1) TFEU, the European Union is to contribute
to the promotion of European sporting issues, while taking account of the specific nature of sport, its structures based on
voluntary activity and its social and educational function.
Accordingly, it is permissible for a Member State to protect sporting events, where appropriate by virtue of protection of
intellectual property, by putting in place specific national legislation, or by recognising, in compliance with European Union
law, protection conferred upon those events by agreements concluded between the persons having the right to make the audiovisual
content of the events available to the public and the persons who wish to broadcast that content to the public of their choice.
It should be added that the European Union legislature has envisaged exercise of that power by a Member State inasmuch as
it refers, in recital 21 in the preamble to Directive 97/36, to events organised by an organiser who is legally entitled to
sell the rights pertaining to that event.
Therefore, if the national legislation concerned is designed to confer protection on sporting events – a matter which it is
for the referring court to establish – European Union law does not preclude, in principle, that protection and such legislation
is thus capable of justifying a restriction on the free movement of services such as that at issue in the main proceedings.
However, it is also necessary that such a restriction does not go beyond what is necessary in order to attain the objective
of protecting the intellectual property at issue (see, to this effect,
UTECA
, paragraphs 31 and 36).
In this regard, it should be pointed out that derogations from the principle of free movement can be allowed only to the extent
to which they are justified for the purpose of safeguarding the rights which constitute the specific subject-matter of the
intellectual property concerned (see, to this effect, Case C‑115/02
Rioglass and Transremar
[2003] ECR I‑12705, paragraph 23 and the case-law cited).
It is clear from settled case-law that the specific subject-matter of the intellectual property is intended in particular
to ensure for the right holders concerned protection of the right to exploit commercially the marketing or the making available
of the protected subject-matter, by the grant of licences in return for payment of remuneration (see, to this effect,
Musik-Vertrieb membran and K-tel International
, paragraph 12, and Joined Cases C‑92/92 and C‑326/92
Phil Collins and Others
[1993] ECR I‑5145, paragraph 20).
However, the specific subject-matter of the intellectual property does not guarantee the right holders concerned the opportunity
to demand the highest possible remuneration. Consistently with its specific subject-matter, they are ensured – as recital
10 in the preamble to the Copyright Directive and recital 5 in the preamble to the Related Rights Directive envisage – only
appropriate remuneration for each use of the protected subject-matter.
In order to be appropriate, such remuneration must be reasonable in relation to the economic value of the service provided.
In particular, it must be reasonable in relation to the actual or potential number of persons who enjoy or wish to enjoy the
service (see, by analogy, Case C-61/97
FDV
[1998] ECR I-5171, paragraph 15, and Case C-52/07
Kanal 5 and TV 4
[2008] ECR I-9275, paragraphs 36 to 38).
Thus, with regard to television broadcasting, such remuneration must in particular – as recital 17 in the preamble to the
Satellite Broadcasting Directive confirms – be reasonable in relation to parameters of the broadcasts concerned, such as their
actual audience, their potential audience and the language version (see, to this effect, Case C-192/04
Lagardère Active Broadcast
[2005] ECR I‑7199, paragraph 51).
In this context, it is to be noted, first of all, that the right holders at issue in the main proceedings are remunerated
for the broadcasting of the protected subject-matter from the Member State of broadcast in which the act of broadcasting is
deemed to take place, in accordance with Article 1(2)(b) of the Satellite Broadcasting Directive, and in which the appropriate
remuneration is therefore payable.
Next, when such remuneration is agreed between the right holders concerned and the broadcasters in an auction, there is nothing
to prevent the right holder from asking, at that time, for an amount which takes account of the actual audience and the potential
audience both in the Member State of broadcast and in any other Member State in which the broadcasts including the protected
subject-matter are also received.
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.
Finally, as regards the premium paid by broadcasters in order to be granted territorial exclusivity, it admittedly cannot
be ruled out that the amount of the appropriate remuneration also reflects the particular character of the broadcasts concerned,
that is to say, their territorial exclusivity, so that a premium may be paid on that basis.
None the less, here such a premium is paid to the right holders concerned in order to guarantee absolute territorial exclusivity
which is such as to result in artificial price differences between the partitioned national markets. Such partitioning and
such an artificial price difference to which it gives rise are irreconcilable with the fundamental aim of the Treaty, which
is completion of the internal market. In those circumstances, that premium cannot be regarded as forming part of the appropriate
remuneration which the right holders concerned must be ensured.
Consequently, the payment of such a premium goes beyond what is necessary to ensure appropriate remuneration for those right
holders.
Having regard to the foregoing, it is to be concluded that the restriction which consists in the prohibition on using foreign
decoding devices cannot be justified in light of the objective of protecting intellectual property rights.
Doubt is not cast on this conclusion by the judgment in
Coditel I
, which has been relied upon by FAPL and others and by MPS in support of their arguments. It is true that, in paragraph 16
of that judgment, the Court held that the rules of the Treaty cannot in principle constitute an obstacle to the geographical
limits which the parties to a contract of assignment of intellectual property rights have agreed upon in order to protect
the author and his assigns and that the mere fact that the geographical limits in question coincide, in some circumstances,
with the frontiers of the Member States does not require a different view.
However, those statements were made in a context which is not comparable to that of the main proceedings. In the case which
led to the judgment in
Coditel I
, the cable television broadcasting companies communicated a work to the public without having, in the Member State of the
place of origin of that communication, an authorisation from the right holders concerned and without having paid remuneration
to them.
By contrast, in the main proceedings the broadcasters carry out acts of communication to the public while having in the Member
State of broadcast, which is the Member State of the place of origin of that communication, an authorisation from the right
holders concerned and by paying them remuneration – which can, moreover, take account of the actual and potential audience
in the other Member States.
Finally, account should be taken of the development of European Union law that has resulted, in particular, from the adoption
of the Television without Frontiers Directive and the Satellite Broadcasting Directive which are intended to ensure the transition
from national markets to a single programme production and distribution market.
iv)        Justification of a restriction on the freedom to provide services by the objective of encouraging the public to attend football
stadiums
FAPL and others and MPS submit, in the alternative, that the restriction at issue in the main proceedings is necessary in
order to ensure compliance with the ‘closed period’ rule which prohibits the broadcasting in the United Kingdom of football
matches on Saturday afternoons. This rule is stated to have the objective of encouraging the public to attend stadiums to
watch football matches, particularly those in the lower divisions; according to FAPL and others and MPS, the objective could
not be achieved if television viewers in the United Kingdom were able freely to watch the Premier League matches which broadcasters
transmit from other Member States.
In that regard, even if the objective of encouraging such attendance of stadiums by the public were capable of justifying
a restriction on the fundamental freedoms, suffice it to state that compliance with the aforementioned rule can be ensured,
in any event, by incorporating a contractual limitation in the licence agreements between the right holders and the broadcasters,
under which the latter would be required not to broadcast those Premier League matches during closed periods. It is indisputable
that such a measure proves to have a lesser adverse effect on the fundamental freedoms than application of the restriction
at issue in the main proceedings.
It follows that the restriction which consists in the prohibition on using foreign decoding devices cannot be justified by
the objective of encouraging the public to attend football stadiums.
In light of all the foregoing, the answer to the questions referred is that, on a proper construction of Article 56 TFEU,
that article 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.
b)           Use of foreign decoding devices following the giving of a false identity and a false address and use of such devices for commercial
purposes (Question 8(c) in Case C‑403/08 and Question 6(ii) and (iii) in Case C-429/08)
By their questions, the referring courts ask, in essence, whether the conclusion set out in paragraph 125 of the present judgment
is affected by the fact, first, 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 at issue in the main proceedings, and
second, that it is used for commercial purposes although it was restricted to private use.
So far as concerns the first circumstance, it is admittedly liable to produce effects in the contractual relations between
the purchaser who has given the false identity and the false address and the person supplying the foreign decoding device,
who may in particular claim damages from the purchaser should the false identity and the false address given by the latter
cause him loss or render him liable to a body such as FAPL. On the other hand, such a circumstance does not affect the conclusion
set out in paragraph 125 of the present judgment, because it has no impact on the number of users who have paid for reception
of the broadcasts.
The same is true of the second circumstance, where the decoding device is used for commercial purposes although it was restricted
to private use.
In this regard, it should be stated that there is nothing to prevent the amount of the remuneration agreed between the right
holders concerned and the broadcasters from being calculated on the basis of the fact that some customers use the decoding
devices commercially whereas others use them privately.
Passing this on to its customers, the broadcaster may thus demand a different fee for access to its services according to
whether the access is for commercial or for private purposes.
However, the risk that certain persons will use foreign decoding devices in disregard of the purpose to which they are restricted
is comparable to the risk which arises when decoding devices are used in purely internal situations, that is to say, when
they are used by customers resident in the Member State of broadcast. Accordingly, the second circumstance cannot justify
a territorial restriction on the freedom to provide services and therefore it does not affect the conclusion set out in paragraph
125 of the present judgment. This is, however, without prejudice to the legal assessment – from the point of view of copyright
– of the use of the satellite broadcasts for commercial purposes following their reception, an assessment which is carried
out in the second part of the present judgment.
Having regard to the foregoing, the answer to the questions referred is that the conclusion set out in paragraph 125 of the
present judgment is 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.
c)           The other questions relating to free movement (the second part of Question 9 in Case C‑403/08 and Question 7 in Case C‑429/08)
In light of the answer to Question 8(b) and the first part of Question 9 in Case C‑403/08 and Question 6(i) in Case C-429/08,
there is no need to examine the second part of Question 9 in Case C-403/08 or Question 7 in Case C-429/08.
4.           Rules of the FEU Treaty concerning competition
By Question 10 in Case C-403/08 and Question 8 in Case C-429/08, the referring courts ask, in essence, whether the clauses
of an exclusive licence agreement concluded between a holder of intellectual property rights and a broadcaster constitute
a restriction on competition prohibited by Article 101 TFEU where they oblige the broadcaster not to supply decoding devices
giving access to that right holder’s protected subject-matter outside the territory covered by the licence agreement concerned.
First of all, it should be recalled that an agreement falls within the prohibition laid down in Article 101(1) TFEU when it
has as its object or effect the prevention, restriction or distortion of competition. The fact that the two criteria are alternatives
means that it is appropriate, first and foremost, to determine whether just one of them is satisfied, here the criterion concerning
the object of the agreement. It is only secondarily, when the analysis of the content of the agreement does not reveal a sufficient
degree of impairment of competition, that the consequences of the agreement should be considered, and for it to be open to
prohibition it is necessary to find that those factors are present which show that competition has in fact been prevented,
restricted or distorted to an appreciable extent (see, to this effect, Case C‑8/08
T‑Mobile Netherlands and Others
[2009] ECR I‑4529, paragraph 28, and Joined Cases C‑501/06 P, C‑513/06 P, C‑515/06 P and C‑519/06 P
GlaxoSmithKline Services and Others
v
Commission and Others
[2009] ECR I‑9291, paragraph 55).
In order to assess whether the object of an agreement is anti-competitive, regard must be had inter alia to the content of
its provisions, the objectives it seeks to attain and the economic and legal context of which it forms a part (see, to this
effect,
GlaxoSmithKline Services and Others
v
Commission and Others
, paragraph 58 and the case-law cited).
As regards licence agreements in respect of intellectual property rights, it is apparent from the Court’s case-law that the
mere fact that the right holder has granted to a sole licensee the exclusive right to broadcast protected subject-matter from
a Member State, and consequently to prohibit its transmission by others, during a specified period is not sufficient to justify
the finding that such an agreement has an anti-competitive object (see, to this effect, Case 262/81
Coditel and Others
(‘
Coditel II
’) [1982] ECR 3381, paragraph 15).
That being so, and in accordance with Article 1(2)(b) of the Satellite Broadcasting Directive, a right holder may in principle
grant to a sole licensee the exclusive right to broadcast protected subject-matter by satellite, during a specified period,
from a single Member State of broadcast or from a number of Member States.
None the less, regarding the territorial limitations upon exercise of such a right, it is to be pointed out that, in accordance
with the Court’s case-law, an agreement which might tend to restore the divisions between national markets is liable to frustrate
the Treaty’s objective of achieving the integration of those markets through the establishment of a single market. Thus, agreements
which are aimed at partitioning national markets according to national borders or make the interpenetration of national markets
more difficult must be regarded, in principle, as agreements whose object is to restrict competition within the meaning of
Article 101(1) TFEU (see, by analogy, in the field of medicinal products, Joined Cases C-468/06 to C-478/06
Sot. Lélos kai Sia and Others
[2008] ECR I-7139, paragraph 65, and
GlaxoSmithKline Services and Others
v
Commission and Others
, paragraphs 59 and 61).
Since that case-law is fully applicable to the field of the cross-border provision of broadcasting services, as follows inter
alia from paragraphs 118 to 121 of the present judgment, it must be held that, where a licence agreement is designed to prohibit
or limit the cross-border provision of broadcasting services, it is deemed to have as its object the restriction of competition,
unless other circumstances falling within its economic and legal context justify the finding that such an agreement is not
liable to impair competition.
In the main proceedings, the actual grant of exclusive licences for the broadcasting of Premier League matches is not called
into question. Those proceedings concern only the additional obligations designed to ensure compliance with the territorial
limitations upon exploitation of those licences that are contained in the clauses of the contracts concluded between the right
holders and the broadcasters concerned, namely the obligation on the broadcasters not to supply decoding devices enabling
access to the protected subject-matter with a view to their use outside the territory covered by the licence agreement.
Such clauses prohibit the broadcasters from effecting any cross-border provision of services that relates to those matches,
which enables each broadcaster to be granted absolute territorial exclusivity in the area covered by its licence and, thus,
all competition between broadcasters in the field of those services to be eliminated.
Also, FAPL and others and MPS have not put forward any circumstance falling within the economic and legal context of such
clauses that would justify the finding that, despite the considerations set out in the preceding paragraph, those clauses
are not liable to impair competition and therefore do not have an anticompetitive object.
Accordingly, given that those clauses of exclusive licence agreements have an anticompetitive object, it is to be concluded
that they constitute a prohibited restriction on competition for the purposes of Article 101(1) TFEU.
It should be added that while, in principle, Article 101(1) TFEU does not apply to agreements which fall within the categories
specified in Article 101(3) TFEU, clauses of licence agreements such as the clauses at issue in the main proceedings do not
meet the requirements laid down by the latter provision for reasons stated in paragraphs 105 to 124 of the present judgment
and therefore the possibility of Article 101(1) TFEU being inapplicable does not arise.
In light of the foregoing, the answer to the questions referred is that the clauses of an exclusive licence agreement concluded
between a holder of intellectual property rights and a broadcaster constitute a restriction on competition prohibited by Article
101 TFEU where they oblige the broadcaster not to supply decoding devices enabling access to that right holder’s protected
subject-matter with a view to their use outside the territory covered by that licence agreement.
B –
Rules relating to the use of the broadcasts once they are received
1.           Introductory remarks
The second part of the questions referred for a preliminary ruling is designed to ascertain whether the reception of the broadcasts
containing Premier League matches and the associated works is subject to restriction pursuant to the Copyright Directive and
the Related Rights Directive by reason of the fact that it results in reproductions of those works within the memory of a
satellite decoder and on a television screen and by reason of the showing of those works in public by the proprietors of the
public houses in question.
It is to be noted that, as is apparent from paragraphs 37 and 57 of the present judgment, two categories of persons can assert
intellectual property rights relating to television broadcasts such as the broadcasts at issue in the main proceedings, namely,
first, the authors of the works concerned and, secondly, the broadcasters.
First, authors can rely on the copyright which attaches to the works exploited within the framework of those broadcasts. In
the main proceedings, it is common ground that FAPL can assert copyright in various works contained in the broadcasts, that
is to say, in particular, the opening video sequence, the Premier League anthem, pre-recorded films showing highlights of
recent Premier League matches, or various graphics.
Secondly, broadcasters such as Multichoice Hellas can invoke the right of fixation of their broadcasts which is provided for
in Article 7(2) of the Related Rights Directive, the right of communication of their broadcasts to the public which is laid
down in Article 8(3) of that directive, or the right to reproduce fixations of their broadcasts which is confirmed by Article
2(e) of the Copyright Directive.
None the less, the questions referred in the main proceedings do not relate to such rights.
Accordingly, the Court’s examination should be limited to Articles 2(a), 3(1) and 5(1) of the Copyright Directive which protect
copyright in the works exploited within the framework of the television broadcasts at issue in the main proceedings, that
is to say, in particular, the opening video sequence, the Premier League anthem, pre-recorded films showing highlights of
recent Premier League matches, or various graphics.
2.           The reproduction right provided for in Article 2(a) of the Copyright Directive (Question 4 in Case C‑403/08)
By this question, the referring court asks, in essence, whether Article 2(a) of the Copyright Directive must be interpreted
as meaning that the reproduction right extends to the creation of transient sequential fragments of the works within the memory
of a satellite decoder and on a television screen which are immediately effaced and replaced by the next fragments. In this
context, the referring court is uncertain, in particular, whether it must conduct its appraisal by reference to all the fragments
as a whole or only by reference to those which exist at a given moment.
First of all, the term ‘reproduction’ in Article 2 of the Copyright Directive is a concept of European Union law which must
be given an autonomous and uniform interpretation throughout the European Union (
Infopaq International
, paragraphs 27 to 29).
As regards its meaning, it has already been observed, in paragraph 97 of the present judgment, that copyright for the purposes
of Article 2(a) of the Copyright Directive can apply only in relation to subject-matter which is its author’s own intellectual
creation (
Infopaq International
, paragraph 37).
The Court has thus stated that the various parts of a work enjoy protection under that provision, provided that they contain
elements which are the expression of the intellectual creation of the author of the work (
Infopaq International
, paragraph 39).
This means that the unit composed of the fragments reproduced simultaneously – and therefore existing at a given moment –
should be examined in order to determine whether it contains such elements. If it does, it must be classified as partial reproduction
for the purposes of Article 2(a) of the Copyright Directive (see, to this effect,
Infopaq International
, paragraphs 45 and 46). In this regard, it is not relevant whether a work is reproduced by means of linear fragments which
may have an ephemeral existence because they are immediately effaced in the course of a technical process.
It is in the light of the foregoing that the referring court must determine whether the creation of transient fragments of
the works within the memory of a satellite decoder and on a television screen results in reproductions for the purposes of
Article 2(a) of the Copyright Directive.
Consequently, the answer to the question referred is that Article 2(a) of the Copyright Directive must be interpreted as meaning
that the reproduction right 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.
3.           The exception in Article 5(1) of the Copyright Directive to the reproduction right (Question 5 in Case C-403/08)
By its question, the referring court asks, in essence, whether acts of reproduction such as those at issue in Case C-403/08,
performed within the memory of a satellite decoder and on a television screen, fulfil the conditions laid down in Article
5(1) of the Copyright Directive and, therefore, whether those acts may be carried out without the copyright holders’ authorisation.
a)           Introductory remarks
Under Article 5(1) of the Copyright Directive, an act of reproduction is to be exempted from the reproduction right provided
for in Article 2 thereof if it fulfils five conditions, that is to say, where:
–        it is temporary;
–        it is transient or incidental;
–        it is an integral and essential part of a technological process;
–        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; and
–        it has no independent economic significance.
It is clear from the case-law that the conditions set out above must be interpreted strictly, because Article 5(1) of the
Copyright Directive is a derogation from the general rule established by that directive that the copyright holder must authorise
any reproduction of his protected work (
Infopaq International
, paragraphs 56 and 57).
None the less, the interpretation of those conditions must enable the effectiveness of the exception thereby established to
be safeguarded and permit observance of the exception’s purpose as resulting in particular from recital 31 in the preamble
to the Copyright Directive and from Common Position (EC) No 48/2000 adopted by the Council on 28 September 2000 with a view
to adopting that directive (OJ 2000 C 344, p. 1).
In 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.
b)           Compliance with the conditions laid down in Article 5(1) of the Copyright Directive
It is undisputed that the acts of reproduction concerned satisfy the first three conditions laid down in Article 5(1) of the
Copyright Directive, because they are temporary, transient and form an integral part of a technological process carried out
by means of a satellite decoder and a television set in order to enable the broadcasts transmitted to be received.
It therefore remains solely to determine whether the fourth and fifth conditions are complied with.
As regards, first of all, the fourth condition, it is to be stated at the outset that the acts of reproduction concerned are
not intended to enable transmission in a network between third parties by an intermediary. Thus, it must be examined alternatively
whether their sole purpose is to enable a lawful use to be made of a work or other subject-matter.
As is apparent from recital 33 in the preamble to the Copyright Directive, a use should be considered lawful where it is authorised
by the right holder or where it is not restricted by the applicable legislation.
Since in the main proceedings the use of the works at issue is not authorised by the copyright holders, it must be determined
whether the acts in question are intended to enable a use of works which is not restricted by the applicable legislation.
In this regard, it is undisputed that those ephemeral acts of reproduction enable the satellite decoder and the television
screen to function correctly. From the television viewers’ standpoint, they enable the broadcasts containing protected works
to be received.
Mere reception as such of those broadcasts – that is to say, the picking up of the broadcasts and their visual display – in
private circles does not reveal an act restricted by European Union legislation or by that of the United Kingdom, as indeed
follows from the wording of Question 5 in Case C-403/08, and that act is therefore lawful. Furthermore, it follows from paragraphs
77 to 132 of the present judgment that such reception of the broadcasts must be considered lawful in the case of broadcasts
from a Member State other than the United Kingdom when it is brought about by means of a foreign decoding device.
Accordingly, the acts of reproduction have the sole purpose of enabling a ‘lawful use’ of the works within the meaning of
Article 5(1)(b) of the Copyright Directive.
Acts of reproduction such as those at issue in the main proceedings thus satisfy the fourth condition laid down by that provision.
So far as concerns, finally, the fifth condition laid down by that provision, these acts of reproduction carried out in the
course of a technological process make access to the protected works possible. Since the latter have an economic value, access
to them necessarily has economic significance.
However, if the exception laid down in Article 5(1) of the Copyright Directive is not to be rendered redundant, that 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, that is to say, beyond the advantage derived from the mere picking up of the broadcast and its
visual display.
In the main proceedings, the temporary acts of reproduction, carried out within the memory of the satellite decoder and on
the television screen, form an inseparable and non-autonomous part of the process of reception of the broadcasts transmitted
containing the works in question. Furthermore, they are performed without influence, or even awareness, on the part of the
persons thereby having access to the protected works.
Consequently, those temporary acts of reproduction are not capable of generating an additional economic advantage going beyond
the advantage derived from mere reception of the broadcasts at issue.
It follows that the acts of reproduction at issue in the main proceedings cannot be regarded as having independent economic
significance. Consequently, they fulfil the fifth condition laid down in Article 5(1) of the Copyright Directive.
This finding, and the finding set out in paragraph 172 of the present judgment, are moreover borne out by the objective of
that provision, which is intended to ensure the development and operation of new technologies. If the acts at issue were not
considered to comply with the conditions set by Article 5(1) of the Copyright Directive, all television viewers using modern
sets which, in order to work, need those acts of reproduction to be carried out would be prevented from receiving broadcasts
containing broadcast works, in the absence of an authorisation from copyright holders. That would impede, and even paralyse,
the actual spread and contribution of new technologies, in disregard of the will of the European Union legislature as expressed
in recital 31 in the preamble to the Copyright Directive.
In light of the foregoing, it must be concluded that acts of reproduction such as those at issue in the main proceedings fulfil
all five conditions laid down in Article 5(1) of the Copyright Directive.
Nevertheless, in order for the exception laid down by that provision to be capable of being relied upon, those acts must also
fulfil the conditions of Article 5(5) of the Copyright Directive. In this regard, suffice it to state that, in view of the
considerations set out in paragraphs 163 to 179 of the present judgment, the acts also satisfy those conditions.
Consequently, the answer to the question referred is that 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 the Copyright Directive and may therefore be carried out without the authorisation of the copyright holders concerned.
4.           ‘Communication to the public’ within the meaning of Article 3(1) of the Copyright Directive (Question 6 in Case C-403/08)
By its question, the referring court asks, in essence, whether ‘communication to the public’ within the meaning of Article
3(1) of the Copyright Directive must be interpreted as covering transmission of the broadcast works, via a television screen
and speakers, to the customers present in a public house.
It should be noted at the outset that Article 3(1) of the Copyright Directive does not define the concept of ‘communication
to the public’ (Case C‑306/05
SGAE
[2006] ECR I‑11519, paragraph 33).
In those circumstances, and in accordance with settled-case law, its meaning and its scope must be determined in light of
the objectives pursued by the Copyright Directive and of the context in which the provision being interpreted is set (
SGAE
, paragraph 34 and the case-law cited).
In this regard, it is to be noted first of all that the principal objective of the Copyright Directive is to establish a high
level of protection of authors, allowing them to obtain an appropriate reward for the use of their works, including on the
occasion of communication to the public. It follows that ‘communication to the public’ must be interpreted broadly, as recital
23 in the preamble to the directive indeed expressly states (see
SGAE
, paragraph 36).
Second, in accordance with recital 20 in its preamble, the Copyright Directive is based on principles and rules already laid
down in the directives in force in the area of intellectual property, such as Directive 92/100 which has been codified by
the Related Rights Directive (see
Infopaq International
, paragraph 36).
In those circumstances, and given the requirements of unity of the European Union legal order and its coherence, the concepts
used by that body of directives must have the same meaning, unless the European Union legislature has, in a specific legislative
context, expressed a different intention.
Finally, Article 3(1) of the Copyright Directive must, so far as possible, be interpreted in a manner that is consistent with
international law, in particular taking account of the Berne Convention and the Copyright Treaty. The Copyright Directive
is intended to implement that treaty which, in Article 1(4), obliges the Contracting Parties to comply with Articles 1 to
21 of the Berne Convention. The same obligation is, moreover, laid down in Article 9(1) of the Agreement on Trade-Related
Aspects of Intellectual Property Rights (see, to this effect,
SGAE
, paragraphs 35, 40 and 41 and the case-law cited).
It is in the light of those three factors that ‘communication to the public’ within the meaning of Article 3(1) of the Copyright
Directive should be interpreted and that it should be assessed whether that concept covers transmission of the broadcast works,
via a television screen and speakers, to the customers present in a public house.
As regards, first, the concept of communication, it is apparent from Article 8(3) of the Related Rights Directive and Articles
2(g) and 15 of the Performance and Phonograms Treaty that such a concept includes ‘making the sounds or representations of
sounds fixed in a phonogram audible to the public’ and that it encompasses broadcasting or ‘any communication to the public’.
More specifically, as Article 11
bis
(1)(iii) of the Berne Convention expressly indicates, that concept encompasses communication by loudspeaker or any other instrument
transmitting, by signs, sounds or images, covering – in accordance with the explanatory memorandum accompanying the proposal
for a copyright directive (COM(97) 628 final) – a means of communication such as display of the works on a screen.
That being so, and since the European Union legislature has not expressed a different intention as regards the interpretation
of that concept in the Copyright Directive, in particular in Article 3 thereof (see paragraph 188 of the present judgment),
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.
The Court, proceeding on the basis of such an interpretation, has already held that a hotel proprietor carries out an act
of communication when he gives his customers access to the broadcast works via television sets, by distributing in the hotel
rooms, with full knowledge of the position, the signal received carrying the protected works. The Court has pointed out that
such intervention is not just a technical means to ensure or improve reception of the original broadcast in the catchment
area, but an act without which those customers are unable to enjoy the broadcast works, although physically within that area
(see, to this effect,
SGAE
, paragraph 42).
In Case C-403/08, the proprietor of a public house intentionally gives the customers present in that establishment access
to a broadcast containing protected works via a television screen and speakers. Without his intervention the customers cannot
enjoy the works broadcast, even though they are physically within the broadcast’s catchment area. Thus, the circumstances
of such an act prove comparable to those in
SGAE
.
Accordingly, it must be held that the proprietor of a public house effects a communication when he intentionally transmits
broadcast works, via a television screen and speakers, to the customers present in that establishment.
That said, in order for there to be a ‘communication to the public’ within the meaning of Article 3(1) of the Copyright Directive
in circumstances such as those of the main proceedings, it is also necessary for the work broadcast to be transmitted to a
new public, that is to say, to 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 (see, to this effect,
SGAE
, paragraphs 40 and 42, and the order of 18 March 2010 in Case C-136/09
Organismos Sillogikis Diacheirisis Dimiourgon Theatrikon kai Optikoakoustikon Ergon
, paragraph 38).
When those authors authorise a broadcast of their works, they consider, in principle, only the owners of television sets who,
either personally or within their own private or family circles, receive the signal and follow the broadcasts. Where a broadcast
work is transmitted, in a place accessible to the public, for an additional public which is permitted by the owner of the
television set to hear or see the work, an intentional intervention of that kind must be regarded as an act by which the work
in question is communicated to a new public (see, to this effect,
SGAE
, paragraph 41, and
Organismos Sillogikis Diacheirisis Dimiourgon Theatrikon kai Optikoakoustikon Ergon
, paragraph 37).
That is so when the works broadcast are transmitted by the proprietor of a public house to the customers present in that establishment,
because those customers constitute an additional public which was not considered by the authors when they authorised the broadcasting
of their works.
In addition, in order for there to be communication to the public, the work broadcast must be transmitted to a ‘public not
present at the place where the communication originates’, within the meaning of recital 23 in the preamble to the Copyright
Directive.
In this regard, it is apparent from Common Position No 48/2000 that this recital follows from the proposal of the European
Parliament, which wished to specify, in the recital, that communication to the public within the meaning of that directive
does not cover ‘direct representation or performance’, a concept referring to that of ‘public performance’ which appears in
Article 11(1) of the Berne Convention and encompasses interpretation of the works before the public that is in direct physical
contact with the actor or performer of those works (see the Guide to the Berne Convention, an interpretative document drawn
up by WIPO which, without being binding, nevertheless assists in interpreting that convention, as the Court observed in
SGAE
, paragraph 41).
Thus, in order to exclude such direct public representation and performance from the scope of the concept of communication
to the public in the context of the Copyright Directive, recital 23 in its preamble explained that communication to the public
covers all communication to the public not present at the place where the communication originates.
Such an element of direct physical contact is specifically absent in the case of transmission, in a place such as a public
house, of a broadcast work via a television screen and speakers to the public which is present at the place of that transmission,
but which is not present at the place where the communication originates within the meaning of recital 23 in the preamble
to the Copyright Directive, that is to say, at the place of the representation or performance which is broadcast (see, to
this effect,
SGAE
, paragraph 40).
Finally, it is to be observed that it is not irrelevant that a ‘communication’ within the meaning of Article 3(1) of the Copyright
Directive is of a profit-making nature (see, to this effect,
SGAE
, paragraph 44).
In a situation such as that in the main proceedings, it is indisputable that the proprietor transmits the broadcast works
in his public house in order to benefit therefrom and that that transmission is liable to attract customers to whom the works
transmitted are of interest. Consequently, the transmission in question has an effect upon the number of people going to that
establishment and, ultimately, on its financial results.
It follows that the communication to the public in question is of a profit-making nature.
In light of all the foregoing, the answer to the question referred is that ‘communication to the public’ within the meaning
of Article 3(1) of the Copyright Directive must be interpreted as covering transmission of the broadcast works, via a television
screen and speakers, to the customers present in a public house.
5.           Effect of the Satellite Broadcasting Directive (Question 7 in Case C‑403/08)
By its question, the referring court asks, in essence, whether the Satellite Broadcasting Directive has a bearing on the lawfulness
of the acts of reproduction performed within the memory of a satellite decoder and on a television screen.
The Satellite Broadcasting Directive provides only for minimum harmonisation of certain aspects of protection of copyright
and related rights in the case of communication to the public by satellite or cable retransmission of broadcasts from other
Member States. Unlike the Copyright Directive, this minimum harmonisation does not provide criteria to determine the lawfulness
of the acts of reproduction performed within the memory of a satellite decoder and on a television screen (see, by analogy,
Case C-293/98
Egeda
[2000] ECR I-629, paragraphs 25 and 26, and
SGAE
, paragraph 30).
Consequently, the answer to the question referred is that the Satellite Broadcasting Directive must be interpreted as not
having a bearing on the lawfulness of the acts of reproduction performed within the memory of a satellite decoder and on a
television screen.
IV –
Costs
Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the referring court,
the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs
of those parties, are not recoverable.
On those grounds, the Court (Grand Chamber) hereby rules:
1.
‘Illicit device’ within the meaning of Article 2(e) of 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 must be interpreted as
not covering foreign decoding devices  (devices which give access to the satellite broadcasting services of a broadcaster,
are manufactured and marketed with that broadcaster’s authorisation, but are used, in disregard of its will, outside the geographical
area for which they have been issued), foreign decoding devices procured or enabled by the provision of a false name and address
or foreign decoding devices which have been used in breach of a contractual limitation permitting their use only for private
purposes.
2.
Article 3(2) of Directive 98/84 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.
3.
On a proper construction of Article 56 TFEU:
–
that article 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;
–
this conclusion is 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.
4.
The clauses of an exclusive licence agreement concluded between a holder of intellectual property rights and a broadcaster
constitute a restriction on competition prohibited by Article 101 TFEU where they oblige the broadcaster not to supply decoding
devices enabling access to that right holder’s protected subject-matter with a view to their use outside the territory covered
by that licence agreement.
5.
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 right 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.
6.
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.
7.
‘Communication to the public’ within the meaning of Article 3(1) of Directive 2001/29 must be interpreted as covering transmission
of the broadcast works, via a television screen and speakers, to the customers present in a public house.
8.
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 not having a bearing on
the lawfulness of the acts of reproduction performed within the memory of a satellite decoder and on a television screen.
[Signatures]
*
Language of the case: English.