On June 27, 2013, the Court of Justice of the EU (CJEU) issued an important judgment on private copying levies.
The CJEU found that, when a copy can be made by a “single process” using a “chain of devices,” e.g., a PC and a printer linked with each other, Member States are free to establish a system where fair compensation is paid by those who are in possession of a device contributing to the single process of copying. However, Member States must ensure that (i) any such system enables device manufacturers to pass the cost of the levy on to consumers; and (ii) the overall amount of fair compensation owed as recompense for the harm suffered by the rightholders at the end of the single process must not be substantially different from the amount fixed for a reproduction by a single device.
The CJEU takes the view that the existence of anti-copying measures does not in itself negate the obligation to pay fair compensation. However, it is open to Member States to determine whether they make the actual level of compensation owed to rightholders dependent on the availability of such anti-copying measures. In addition, the CJEU found that a rightholder’s explicit or implicit authorization to copy its works has no bearing on its right to receive fair compensation.
This ruling must be seen in the context of the ongoing reform of the EU’s copyright levy system. In January 2013, former Commissioner António Vitorino acting as a “mediator” on private copying and reprography levies delivered several recommendations to the European Commission. For instance, he observed that liability for paying levies should be shifted from the level of manufacturers and importers to retailers level, and the levy tariff system should be simplified. He also recommended that “harm” resulting from uncompensated private copying must be defined uniformly across the EU in order to ensure coherence.
Directive 2001/29/EC on the harmonisation of certain aspects of copyright and related rights in the information society (“Directive”) sets out the EU’s legal framework to protect copyright and related rights. While authors, performers or producers enjoy an exclusive reproduction right to their protected works (Article 2), Member States may impose exceptions or limitations to the exclusive right in certain cases e.g., :
- Article 5(2)(a): reproductions on paper or any similar medium, effected by the use of any kind of photographic technique or by some other process having similar effects, provided that the rightholders receive fair compensation;
- Article 5(2)(b): reproductions on any medium made for an individual’s private use, provided that the rightholders receive fair compensation which takes account of the application or non-application of technological protection measures;
- Article 5(3): use for the sole purpose of illustration for teaching, scientific research or private study.
Under German copyright law (which has implemented the Directive), rightholders are entitled to fair remuneration from the manufacturers, importers or sellers of devices capable of making reproductions by photocopying or any process having similar effects.
VG Wort, a copyright collecting society in Germany, had initiated a lawsuit seeking (1) access to certain information on the nature and quantity of the printers sold in Germany since 2001; and (2) a declaration that the PCs, printers and/or plotters of certain manufacturers sold in Germany between 2001 and 2007 should be levied. The case went up to Germany’s highest court.
The German Federal Court of Justice (Bundesgerichtshof) referred questions on the interpretation of the Directive to the CJEU. On June 27, 2013, the CJEU issued the judgment presented above.