Amazon.com International Sales Inc. and Others v Austro-Mechana Gesellschaft zur Wahrnehmung mechanisch-musikalischer Urheberrechte Gesellschaft mbH.
Date: 2013-07-11
19. The Court has held that, where Member States decide to introduce the private copying exception into their national law, they are required, in particular, to provide, pursuant to Article 5(2)(b), for the payment of ‘fair compensation’ to holders of the exclusive right of reproduction (see Case C‑467/08 Padawan  [2010] ECR I‑10055, paragraph 30, and Case C‑462/09 Stichting de Thuiskopie  [2011] ECR I‑5331, paragraph 22).
20. The Court has also held that, since the provisions of Directive 2001/29 do not expressly address the issue of who is to pay that compensation, the Member States enjoy broad discretion when determining who must discharge that obligation ( Stichting de Thuiskopie , paragraph 23). The same is true of the form, detailed arrangements and possible level of such compensation.
21. In the absence of sufficiently precise Community criteria in a directive to delimit the obligations under the directive, it is for the Member States to determine, in their own territory, what are the most relevant criteria for ensuring, within the limits imposed by European Union law and in particular by the directive concerned, compliance with that directive (see, as regards the derogation from the exclusive public lending right under 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), Case C‑36/05 Commission v Spain  [2006] ECR I‑10313, paragraph 33 and case-law cited).
23. As regards the private copying exception under Article 5(2)(b) of that directive, the Court has held that, since the person who has caused the harm to the holder of the exclusive right of reproduction is the person who, for his private use, reproduces a protected work without seeking prior authorisation from that rightholder, it is, in principle, for that person to make good the harm related to that copying by financing the compensation which will be paid to that rightholder ( Padawan , paragraph 45, and Stichting de Thuiskopie , paragraph 26).
24. The Court has however accepted that, given the practical difficulties in identifying private users and obliging them to compensate the holders of the exclusive right of reproduction for the harm caused to them, it is open to the Member States to establish a ‘private copying levy’ for the purposes of financing fair compensation, chargeable not to the private persons concerned but to those who have the digital reproduction equipment, devices and media and who, on that basis, in law or in fact, make that equipment available to private users or who provide copying services for them. Under such a system, it is the persons having that equipment who must discharge the private copying levy ( Padawan , paragraph 46, and Stichting de Thuiskopie , paragraph 27).
25. The Court has, further, pointed out that, since that system enables the persons responsible for payment to pass on the amount of the private copying levy in the price charged for making the reproduction equipment, devices and media available, or in the price for the copying service supplied, the burden of the levy will ultimately be borne by the private user who pays that price, in a way consistent with the ‘fair balance’ between the interests of the holders of the exclusive right of reproduction and those of the users of the protected subject-matter ( Stichting de Thuiskopie , paragraph 28).
26. In the present case, in the system established by Paragraph 42b of the UrhG for the financing of fair compensation within the meaning of Article 5(2)(b) of Directive 2001/29, the private copying levy is payable by those who make available, for commercial purposes and for consideration, recording media suitable for reproduction.
27. In principle, such a system, as has already been pointed out in paragraph 25 of the present judgment, enables the persons responsible for payment to pass on the amount of that levy in the sale price of those media, so that the burden of the levy is ultimately borne, in accordance with the requirement of a ‘fair balance’, by the private user who pays that price, if such a user is the final recipient.
28. The Court has held that a system for financing fair compensation such as that described in paragraphs 24 and 25 of this judgment is compatible with the requirements of a ‘fair balance’ only if the digital reproduction equipment, devices and media concerned are liable to be used for private copying and, therefore, are likely to cause harm to the author of the protected work. There is therefore, having regard to those requirements, a necessary link between the application of the private copying levy to the digital reproduction equipment, devices and media and their use for private copying, such that the indiscriminate application of the private copying levy to all types of digital reproduction equipment, devices and media, including in the case where they are acquired by persons other than natural persons for purposes clearly unrelated to private copying, does not comply with Article 5(2) of Directive 2001/29 ( Padawan , paragraphs 52 and 53).
29. The system at issue in the main proceedings amounts to the indiscriminate application of the private copying levy to recording media suitable for reproduction, including in the case where the final use thereof does not fall within the case covered by Article 5(2)(b) of Directive 2001/29.
30. The question therefore arises as to whether, in such a situation, a right to reimbursement of the levy paid allows the restoration of the ‘fair balance’ which is to be struck, according to the requirements of Directive 2001/29, between the interests of the holders of the exclusive right of reproduction and those of the users of the protected subject-matter.
31. In that regard, it must be held that a system of financing fair compensation consisting in the indiscriminate application of a private copying levy on the placing on the market, for commercial purposes and for consideration, of recording media suitable for reproduction, together with such a right to reimbursement, provided that that right is effective and does not make it excessively difficult to repay the levy paid, may prove to be consistent with Article 5(2)(b) of Directive 2001/29, where the practical difficulties described in paragraph 24 of the present judgment or other similar difficulties justify its application.
32. If a Member State has introduced a private copying exception into its national law, it must ensure, in accordance with its territorial competence, the effective recovery of the fair compensation for the harm suffered by the holders of the exclusive right of reproduction by reason of the reproduction of protected works by final users who reside on the territory of that State (see, to that effect, Stichting de Thuiskopie , paragraph 36). Thus, where such recovery presents difficulties, the Member State concerned is also required to resolve them by taking into account the circumstances of each case.
34. It is for the national court to verify, in the light of the particular circumstances of each national system and the limits imposed by Directive 2001/29, whether the practical difficulties justify such a system of financing fair compensation and, if so, whether the right to reimbursement of any levies paid in cases other than that under Article 5(2)(b) of Directive 2001/29 is effective and does not make repayment of those levies excessively difficult.
36. Secondly, the referring court must also verify that the scope, the effectiveness, the availability, the publicisation and the simplicity of use of the right to reimbursement allow the correction of any imbalances created by the system in order to respond to the practical difficulties observed. In that regard, it must be observed that the referring court itself stresses that the cases of reimbursement are not limited to those expressly covered by Paragraph 42(b)(6) of the UrhG.
37. In the light of the foregoing observations, the answer to the first question is that Article 5(2)(b) of Directive 2001/29 must be interpreted as meaning that it does not preclude legislation of a Member State which indiscriminately applies a private copying levy on the first placing on the market in national territory, for commercial purposes and for consideration, of recording media suitable for reproduction, while at the same time providing for a right to reimbursement of the levies paid in the event that the final use of those media does not meet the criteria set out in that provision, where, having regard to the particular circumstances of each national system and the limits imposed by Directive 2001/29, which it is for the national court to verify, practical difficulties justify such a system of financing fair compensation and the right to reimbursement is effective and does not make repayment of the levies paid excessively difficult.
The second question
47. In that connection, it must be borne in mind that the notion and level of fair compensation under Article 5(2)(b) of Directive 2001/29 are linked to the harm resulting for the holders of the exclusive right of reproduction from the reproduction for private use of their protected works without their authorisation. From that perspective, fair compensation must be regarded as recompense for the harm suffered by such rightholders and must necessarily be calculated on the basis of the criterion of the harm caused to them by the introduction of the private copying exception ( Padawan , paragraphs 40 and 42).
48. Moreover, the Court has held that, with regard to the right to fair compensation payable to holders of the exclusive right of reproduction under the private copying exception, it does not follow from any provision of Directive 2001/29 that the European Union legislature envisaged the possibility of that right being waived by the person entitled to it (Case C‑277/10 Luksan [2012] ECR I‑0000, paragraph 105).
57. In that regard, it must be borne in mind that Article 5(2)(b) of Directive 2001/29 imposes on a Member State which has introduced the private copying exception into its national law an obligation to achieve a certain result, in the sense that that State must ensure, within the framework of its powers, that the fair compensation intended to compensate the holders of the exclusive right of reproduction harmed for the prejudice sustained is actually recovered, especially if that harm arose on the territory of that Member State ( Stichting de Thuiskopie , paragraph 34).
58. Since it is in principle for the final users who, for their private use, reproduce a protected work without seeking prior authorisation from the holder of the exclusive right of reproduction, thereby causing him harm, to make good that harm, it can be assumed that the harm for which reparation is to be made arose on the territory of the Member State in which those final users reside ( Stichting de Thuiskopie , paragraph 35).
59. It follows that, if a Member State has introduced an exception for private copying into its national law and if the final users who, on a private basis, reproduce a protected work reside on its territory, that Member State must ensure, in accordance with its territorial competence, the effective recovery of the fair compensation for the harm suffered by the holders of the exclusive right of reproduction on the territory of that State ( Stichting de Thuiskopie , paragraph 36).
60. Moreover, it must be recalled that the system of recovery chosen by the Member State concerned cannot relieve that Member State of the obligation to achieve the certain result of ensuring that the holders of the exclusive right of reproduction who have suffered harm actually receive payment of fair compensation for the prejudice which arose on its territory ( Stichting de Thuiskopie , paragraph 39).
61. In that regard, it is of no bearing on that obligation that, in the case of distance selling arrangements, the commercial seller who makes available reproduction equipment, devices and media to purchasers residing on the territory of that Member State, as final users, is established in another Member State ( Stichting de Thuiskopie , paragraph 40).