Source: http://copyrightblog.kluweriplaw.com/2018/09/03/comments-article-13-related-provisions-juri-committee-report-directive-copyright-digital-single-market/
Timestamp: 2019-04-23 23:01:53+00:00

Document:
In the run-up to the Plenary vote of the European Parliament in June and again currently, some academics and other voices have criticized the JURI Committee Report especially on Article 13 of the Proposal for a Directive on Copyright in the Digital Single Market. Among others, they purport that these proposals would contravene the acquis communautaire on the exclusive right of communication to the public/making available and on the liability exemptions of the E-commerce Directive. This article aims at examining such claims on the basis of an analysis of current EU law.
In particular, it discusses whether the proposed text represents a departure from EU law regarding Art. 3 InfoSoc Directive and Art. 14 E-commerce Directive.
The proposed text does not represent a departure from the EU law regarding the relationship and interplay between Art. 3 InfoSoc Directive and Art. 14 E-commerce Directive.
1. Does the proposed text of the JURI Committee Report represent a departure from EU law regarding Art. 3 InfoSoc Directive and Art. 14 E-commerce Directive?
The short answer to this question is: No, Art. 13 (-1.) and the related Recitals of the Report only clarify existing EU law and do not depart from the acquis communautaire set out in Art. 3 InfoSoc Directive and Art. 14 E-commerce Directive as interpreted by the CJEU. In particular, as will be shown below, first, the activities by those online content sharing service providers that are covered by the proposed Art. 13 (and as defined in Art. 2(1) pt. (4b)/(4c) of the Report) regularly constitute acts of communication to the public/making available within the meaning of Art. 3 InfoSoc Directive as interpreted by the CJEU; secondly, the JURI Committee Report does not contradict the safe harbour provision under Art. 14 E-commerce Directive as interpreted by the Court.
Art. 13(-1.) of the Report states the following: “Without prejudice to Article 3(1) and (2) of Directive 2001/29/EC, online content sharing service providers perform an act of communication to the public…”; Art. 2(1) pt. (4b) of the Report defines ‘online content sharing service provider’ as “a provider of an information society service one of the main purposes of which is to store and give access to the public to copyright protected works … uploaded by its users, which the service optimises. Services acting in a non-commercial purpose capacity such as online encyclopaedia, and providers of online services where the content is uploaded with the authorisation of all rightholders concerned, such as educational or scientific repositories, should not be considered online content sharing service providers …. Providers of cloud services for individual use which do not provide direct access to the public, .., should not be considered online content sharing service providers …;” and Art. 2(1) refers in pt. (4c) to the definition of “information society service” in Art. 1(1)(b) of Directive (EU) 2015/1535.
In brief, such service providers run platforms from which works uploaded by users and optimised by the service providers are made available to the public.
Art. 3 InfoSoc Directive provides for the exclusive right of communication including making available to the public for authors and the exclusive making available right for certain related rights’ owners and thereby implements Art. 8 WIPO Copyright Treaty and Art. 10, 14 WIPO Performances and Phonograms Treaty. The act of making available covered by these rights is described in these provisions as ‘making available to the public of their works in such a way that members of the public may access these works from a place and at a time individually chosen by them’. This act occurs in particular when a work is uploaded on a UUC platform run by an online content sharing service provider so that it is thereby offered to the public, and it also covers the transmission to the public once that transmission occurs, i.e., when a member of the public individually accesses the work on the platform.
According to the Court, a communication is any transmission, irrespective of the technical means or procedure (e.g., Reha 38). In addition, the Court has also confirmed that it is sufficient that the public may access the work, irrespective of whether an actual transmission takes place (e.g., Svensson 19; Filmspeler 36). More generally, the CJEU, when interpreting these rights, refers to Recitals 9, 10 and 23 of the InfoSoc Directive (e.g., Filmspeler 3, The Pirate Bay 3); they, respectively, require a high level of protection; stress the need for authors and performers to receive an appropriate reward for the use of their work, as well as producers in order to be able to finance this work; and suggest a broad interpretation of the right of communication to the public. There is no doubt that a “communication” according to the Court’s interpretation occurs in the situation covered by Art. 13.
The communication must be “to the public”. The main criterion of the Court for this is fulfilled in the situation covered by Art. 13: there is an indeterminate and fairly large number of persons that constitute the public to which works are communicated from the relevant platforms. In line with this, the JURI Committee Report by means of clarification explicitly excludes services that are only accessible to individual users but not to the public (Art. 2(1) pt (4b) states: “Providers of cloud services for individual use which do not provide direct access to the public… should not be considered online content sharing service providers within the meaning of this Directive.”).
Even if one takes into account further criteria that were developed by the Court but are likely to be in contravention of the underlying international law, i.e. the criteria of a ‘new public’ and the ‘non-profit character’, they do not constitute an obstacle to the application of the communication / making available right to the situation covered by Art. 13. First, a ‘new public’ according to the Court is only relevant in the case of re-transmissions of primary communications (e.g., by a hyperlink) rather than for a new posting on a platform (such as in the case covered by Art. 13, and as recently held by the Court in Land Nordrhein-Westfalen, 35, where communication was not considered as being to a new public); anyway, the ‘new public’ criterion does not apply to works uploaded without the consent of the right owner (as is often the case for UUC platforms). Secondly, the UUC platform activity is typically for profit; moreover, under Art. 2(1) pt (4b) of the JURI Committee Report, “services acting in a non-commercial purpose capacity… should not be considered online content sharing service providers within the meaning of this Directive.” Accordingly, the latter services are not regulated by this provision.
Again, there is no doubt that a communication covered by Art. 13 of the JURI Committee Report is “to the public”, according to the Court’s interpretation.
1.1.4 Who performs the act according to the Court?
The main question therefore is who is performing an act of communication to the public: the online content sharing service providers covered by Art. 13 or only the individual users who upload the content. The CJEU has in several cases dealt with the question of who performs such an act. In particular, the operator of a hotel or public house performs a communication to the public when intervening in full knowledge of the consequences of its action to give access to content to its customers. The Court has stressed the important, ‘indispensable’ role of the user as the one performing such act (‘without its intervention the customers cannot enjoy the works …’ , e.g., SGAE 42; Premier League 195; see also SCF 82), and highlighted that content may be accessed by the public ‘only as a result of a deliberate intervention of that operator’ (e.g. PPL 40). Such intervention may also be the installation of a CD player and phonograms in a hotel room by a hotel operator, who thereby makes a communication to the public (PPL 66-69), since without its intervention, the guests would not have access to the works. Merely in light of this assessment, it is correct to state that a UUC or similar platform plays an indispensable role when enabling access to the content uploaded by its users.
The fact that the acts by users who upload content are also indispensable for the overall act of communication / making available to the public still allows acknowledgement that there may be several actors (and thus both users and UUC platforms) who play such an indispensable role and are liable as users. In particular, in the ‘Airfield’ case, a satellite package provider performed an act of communication to the public by intervening in the communication of programs by satellite by broadcasting organizations (Airfield, e.g. 79, 83). Accordingly, a party participating in a communication may be held liable for communication / making available to the public (e.g. Airfield 69-70). More recently, the Court held in the case of the platform “The Pirate Bay” that, although users had uploaded works on that platform, the “operators, by making available and managing an online sharing platform such as that at issue in the main proceedings, intervene, with full knowledge of the consequences of their conduct, to provide access to protected works, by indexing on that platform torrent files which allow users of the platform to locate those works and to share them within the context of a peer-to-peer network” (The Pirate Bay 36). It therefore considered the platform as “playing an essential role in making the works in question available” (The Pirate Bay 37). Art. 2(1) pt (4b) of the JURI Committee Report describes a similar activity, which reflects this essential role: it explains that the service providers covered are those which “optimise” the subject matter uploaded by the users; such “optimising” is further illustrated by Recital 37a of the Report by the examples of “promoting displaying, tagging, curating, sequencing the uploaded works or other subject-matter, irrespective of the means used therefor” with the result that the service providers “therefore act in an active way”. Against this background and following the quoted case law, it seems obvious that the UUC platform, which intervenes in the act of communication to the public initiated by the uploader, will regularly be liable for the act of communication / making available to the public.
According to Recital 27 of the InfoSoc Directive, the mere provision of physical facilities does not constitute an act of communication to the public. In this regard, the Court held, e.g., that the mere installation of television sets in hotel rooms does not constitute a communication to the public, but that the enabling of the subsequent transmission of the signal to the guests by means of the television sets does so (SGAE 46; for a similar judgment, see Organismos Sillogikis 39). The Court also held that the mere provision of facilities was ‘the simple activity of sale or rental of television sets by specialized enterprises.’ (Organismos Sillogikis 40), but that the technical intervention of the hotel owner that rendered access to works for guests in hotel rooms was a communication to the public (Organismos Sillogikis 41). In addition, in the Pirate Bay case, the Court clarified that that platform, by indexing and classifying the user-uploaded files so that they can be easily located, etc., did more than merely providing facilities, and that it had to be considered as performing an act of communication to the public (The Pirate Bay 38, 39).
Given this case law, a provider covered by Art. 13 and the related provisions of the JURI Committee Report may not be considered as merely providing physical facilities but rather as performing an act of communication to the public.
Finally, UUC and similar platform providers also generally know that, through their deliberate intervention, the works uploaded by users are made available to the public; this is sufficient according to the Court, which requires that the user intervenes ‘in full knowledge of the consequences of its action’, ‘intentionally’, or ‘deliberately’ (SGAE 42, Premier League 195, 196, Organismos Sillogikis 39, Filmspeler 31, et al.).
As a result, the proposed Art. 13 and related provisions of the JURI Committee Report only clarify the acquis communautaire. It should be noted in addition that Art. 13 (-1.) explicitly “leaves without prejudice” Article 3(1) and (2) of Directive 2001/29/EC on communication to the public.
From a systematic point of view, Art. 14 E-Commerce Directive aims at exempting host provider services from liability for acts of third persons, under certain conditions. In contrast, where someone is liable for his or her own act (in particular, an act of communication to the public), primary liability applies; he must thus acquire licenses for performing such act. As the Court held in particular for a service offering a platform to which users upload files (The Pirate Bay, see 1.1.4 and 1.1.5 above), such a service does perform an act of communication to the public, and is thus primarily liable, if it indexes and classifies the user-uploaded files so that they can be easily located, etc..
Such criteria correspond to those applied by the Court to exclude the applicability of the safe harbour of Art. 14 E-Commerce Directive. In particular, the Court held that a provider is not covered thereby if it ‘plays an active role of such kind as to give it knowledge of, or control of, those data’ (L’Oréal 113), or as to ‘provide(d) assistance which entails, in particular, optimizing the presentation of the offers…’ (L’Oréal 116). Accordingly, the Court’s jurisprudence is coherent where it renders primarily liable a provider who plays an essential role in the communication (as described above, 1.1.4, referring to the Pirate Bay case and largely corresponding to an active role) and at the same time excludes such provider who plays an active role from the safe harbour of Art. 14 E-Commerce Directive.
This system of the law as interpreted by the Court has been mirrored exactly in the JURI Committee Report, especially in its Recital 38: Accordingly, online content sharing service providers themselves perform an act of communication to the public and thus are themselves responsible for their own act, and “therefore” cannot be exempted from liability as a mere host under Art. 14 E-Commerce Directive; that Article does not apply to providers who play an active role (as further described, in line with the case law of the Court, in Recital 38 para. 3 of the Report, which refers to the examples of “optimising the presentation” of the works or “promoting” them).
A service provider is covered by Art. 14 E-Commerce Directive only if he plays a passive role, in particular when he supplies a ‘service neutrally by a merely technical and automatic processing of the data provided by its customers,’ (L’Oréal 113), and simply ‘stores offers for sale on its server, sets the terms of its service, is remunerated for that service and provides general information to its customers’ (L’Oréal 115). A provider who himself performs the act of communication to the public (as those under Art. 13, in line with the case law of the Court) does not play such a passive role.
Accordingly, Art. 13 and Recital 38 of the JURI Committee Report correspond to and reaffirm the existing case law of the Court on Art. 14 E-Commerce Directive and do not depart from it.
The proposed text of the JURI Committee Report does not represent a departure from EU law regarding Art. 3 InfoSoc Directive and Art. 14 E-commerce Directive but fully corresponds to it, including to the interpretation by the Court.
 See, e.g. the Report and Opinion by ALAI, http://www.alai.org/en/assets/files/resolutions/making-available-right-report-opinion.pdf, in particular p. 3.
 See, e.g., the ALAI Opinion http://www.alai.org/en/assets/files/resolutions/2014-opinion-new-public.pdf, e.g. p. 2.
I am afraid I disagree with every single point in this article. While most of it is technically correct, there are important ideas specific to the digital world which have been overlooked.
First, that platforms are legitimate targets of regulation is by no means a foregone conclusion. That the proposal targets “platforms” rather than “information society services”, and makes a number of assumptions on the way, is a problem of enormous proportions, not just in terms of how well the proposal communicates with the E-Commerce Directive, but also in terms of is relation to other EU IT laws. In short, one cannot just wave a magic wand, assume that all UGC cites are “platforms”, and then happily continue discussing whether such platforms engage in communication to the public, as if this move had no consequences, all of this in almost complete absence of an official EU policy on platforms. This is an issue I discuss in a forthcoming article, (2018) 6 CLSR.
Second, the Proposal simply states that “active” online platforms perform a communication to the public. What an “active” site is has been debated ad nauseam for over two decades now, but is still not a point which has been adequately resolved in CJEU case law, which is obscure and can often only be read in its particular context. One cannot equate TV sets in hotel rooms with streaming services or cloud depositories. Neither can one use Pirate Bay – an openly and proudly illegal distributor – as a comparison point for a streaming/distribution platform, no matter how active the latter might be. This problem is about communication to the public of a bona fide platform, and Pirate Bay case is of limited to no use here.
Third, the main problem in this issue is not whether a “platform” (for what this term is worth) can technically be deemed to fit within various bits and pieces of law on communication to the public but whether it makes sense to dump all online distributors into the same category and burden them with regulation and filtering obligations in almost complete absence of harmony with the spirit and letter of ECD Articles 12-15. The ISP liability regime has been designed with a very specific idea of avoiding indiscriminate filtering and cannot be changed by simply labelling all online distributors as active – a presumption of huge consequence.
Fourth, while there is no doubt that Article 14 was never meant to protect knowledgeable providers or primary infringers, the Voss proposal sharpens the already muddled Preamble 38 by making what is essentially an irrebuttable presumption of knowledge for all UGC ISPs. Whereas the original Proposal talks of communication only where there are activities “beyond the mere provision of physical facilities”, the Voss text simply states that all online content sharing providers are communicators. Why would they be so and, even where they are, why would they exercise prior rather than subsequent restraint? I will not even begin on the subject of how broad the definition of 37a really is. This subjects a vast and ill-defined category to a poorly designed and heavily-lobbied-for set of expensive filtering. Surely, this cannot have been the intention of the original drafters of InfoSoc Directive?
Fifth, the main problem of the both the original Proposal and the Voss text is that indiscriminate and expensive filtering of the kind only Google can pay for is demanded. All this in complete contradiction to SABAM case which is very clear on this (but is not discussed in the article above).
Finally, the Proposal is incredibly badly harmonised with the spirit and letter of the E-Commerce Directive. I am afraid that no amount of careful interpretation of the communication to the public will resolve this. The Commission has been told, a vast number of times, by very many people indeed that this is a problem of gigantic proportions. It has so far chosen to ignore it, which fortunately led to its defeat in the early summer. Let us hope that the Proposal will be defeated once and for all in September so that we can begin a serious and much-needed discussion on the reform of EU copyright law.

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