Proposal for a European Parliament and Council Directive on the legal protection of services based on, or consisting of conditional access (97/C 314/07) (Text with EEA relevance) COM(97) 356 final - 97/0198(COD)

(Submitted by the Commission on 22 September 1997)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Articles 57 (2), 66 and 100a thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the Economic and Social Committee,

Acting in accordance with the procedure laid down in Article 189b of the Treaty,

Whereas the objectives of the European Community as laid down in the Treaty include establishing an ever closer union among the peoples of Europe and ensuring economic and social progress, by eliminating the barriers which divide them;

Whereas the cross-border provision of broadcasting and information society services may contribute significantly to the achievement of those objectives;

Whereas the Treaty provides for the free movement of all services provided for remuneration; whereas this right, as applied to broadcasting and information society services, is also a specific manifestation in Community law of a more general principle, namely the freedom of expression as enshrined in Article 10 of the European Convention for the Protection of Human Rights and Fundamental Freedoms;

Whereas the Commission undertook a wide-ranging consultation based on the Green Paper 'Legal protection of encrypted services in the internal market` (1); whereas the results of that consultation confirmed the need for a Community legal instrument ensuring the legal protection of all those services whose remuneration relies on conditional access;

Whereas the European Parliament, in its resolution of 13 May 1997 on the Green Paper (2) called on the Commission to present a proposal for a Directive covering all encoded services in respect of which encoding is used to ensure payment of a fee, and agreed that this should include information society services, provided at a distance by electronic means and at the individual request of a service receiver, as well as broadcasting services;

Whereas 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 59 and 60 of the Treaty; whereas the viability of those services will often depend on the use of conditional access in order to obtain the remuneration of the service provider;

Whereas the importance of this issue was recognized by the Commission communication on a European initiative in electronic commerce (3), which announced a proposal for a directive in order to establish an equivalent level of protection for service providers across Europe;

Whereas, in accordance with Article 7a of the Treaty, the internal market is to comprise an area without internal frontiers in which the free movement of services and goods is ensured; whereas Article 128 (4) of the Treaty requires the Community to take cultural aspects into account in its action pursuant to other provisions of the Treaty; whereas by virtue of Article 130 (3), the Community must, through the policies and activities it pursues, contribute to creating the conditions necessary for the competitiveness of the Community's industry;

Whereas the disparity between national rules concerning the legal protection of services based on, or consisting of conditional access is liable to create obstacles to the free movement of services and goods;

Whereas the application of the Treaty is not sufficient to remove these internal market obstacles; whereas those obstacles should therefore be removed by providing for an equivalent level of protection between Member States; whereas this implies an approximation of the national rules relating to the commercial activities which concern illicit devices;

Whereas those commercial activities are detrimental to consumers who are misled about the origin of illicit devices; whereas a high level of consumer protection is needed in order to fight against this kind of consumer fraud; whereas Article 129a (1) of the Treaty provides that the Community should contribute to the achievement of a high level of consumer protection by the measures it adopts pursuant to Article 100a;

Whereas, therefore, the legal framework for the creation of a single audiovisual area laid down in 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 (4), as last amended by Directive 97/36/EC of the European Parliament and of the Council (5), should be supplemented with reference to conditional access techniques as laid down in this Directive, in order, not least, to ensure equal treatment of the suppliers of cross-border broadcasts, regardless of their place of establishment;

Whereas, in accordance with the Council resolution of 29 June 1995 on the effective uniform application of Community law and on the penalties applicable for breaches of Community law in the internal market (6) Member States are required to take action to ensure that Community law is duly applied with the same effectiveness and thoroughness as national law;

Whereas the approximation of the laws, regulations and administrative provisions of the Member States should be limited to what is needed in order to achieve the objectives of the internal market, in accordance with the principle of proportionality as set out in the third paragraph of Article 3b of the Treaty;

Whereas this Directive should be without prejudice to the application of national provisions which may prohibit the private possession of illicit devices; whereas this Directive is without prejudice to the application of Community competition rules, whereas this Directive is without prejudice to the application of Community rules concerning intellectual property rights;

Whereas this Directive is without prejudice to the application of national rules which do not fall within the field herein coordinated, such as those adopted for the protection of minors in compliance with Directive 89/552/EEC,

HAVE ADOPTED THIS DIRECTIVE:

Article 1

Definitions

For the purposes of this Directive:

(a) 'protected service` means any of the following services, where provided on the basis of conditional access:

- television broadcasting, as defined in point (a) of Article 1 of Directive 89/552/EEC,

- radio broadcasting, meaning any transmission by wire or over the air, including that by satellite, of radio programmes intended for reception by the public,

- information society services within the meaning of Article 1 point 2 of Council Directive 83/189/EEC (7), as amended by Directive . . ./. . . (8),

or the provision of conditional access to the above services as a service in its own right;

(b) 'conditional access` means any technical measure and/or arrangement whereby access to the service in an intelligible form is made conditional on a prior individual authorization aiming at ensuring the remuneration of that service;

(c) 'conditional access device` means any equipment or software designed or adapted to give access to a protected service in an intelligible form;

(d) 'associated service` means the installation, maintenance or replacement of conditional access devices, as well as the provision of commercial communication services in relation to protected services or devices or other associated services;

(e) 'illicit device` means any equipment or software designed or adapted to give unauthorized access to a protected service;

(f) 'unauthorized access` means access to a protected service in an intelligible form without the authorization of the service provider;

(g) 'field coordinated by this Directive` means any provision relating to unauthorized access to protected services.

Article 2

Internal market principles

1. Each Member State shall take the measures necessary to prohibit on its territory the activities listed in Article 3, and to provide the sanctions and remedies laid down in Article 4.

2. Without prejudice to paragraph 1, Member States may not, for reasons which fall within the field coordinated by this Directive:

(a) restrict the provision of protected services, or associated services, that originate in another Member State,

(b) restrict the free movement of conditional access devices.

Article 3

Infringing activities

Member States shall prohibit on their territory all of the following activities:

(a) the manufacture, import, sale 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.

Article 4

Sanctions and remedies

1. The sanctions referred to at Article 2 (1) shall be effective, deterrent and proportional to the potential impact of the infringing activity.

2. Each Member State shall take the measures necessary to ensure that service providers, whose interests are affected by an infringing activity carried out on its territory, can bring an action for damages and seek an injunction and, where appropriate, apply for the seizure of illicit devices.

Article 5

Implementation

1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Directive by 31 December 1999 and shall communicate them to the Commission.

When Member States adopt these provisions, these shall contain a reference to this Directive or shall be accompanied by such reference at the time of their official publication. The procedure for such reference shall be adopted by Member States.

2. Member States shall communicate to the Commission the text of the provisions of national law which they adopt in the field coordinated by this Directive.

Article 6

Reports

Not later than five years after the entry into force of this Directive, and every three years thereafter, the Commission shall present a report to the European Parliament, the Council and the Economic and Social Committee concerning the implementation of this Directive accompanied, where appropriate, by proposals for adapting it in light of technical and economic developments.

Article 7

Entry into force

This Directive shall enter into force on the 20th day following its publication in the Official Journal of the European Communities.

Article 8

Addressees

This Directive is addressed to the Member States.

(1) COM(96) 76 final of 6 March 1996.

(2) OJ C 167, 2. 6. 1997.

(3) COM(97) 157 final of 16 April 1997.

(4) OJ L 298, 17. 10. 1989, p. 23.

(5) OJ L 202, 30. 7. 1997, p. 60.

(6) OJ C 188, 22. 7. 1995, p. 1.

(7) OJ L 109, 26. 4. 1983, p. 8.

(8) OJ L . . .