Court of Justice of the EU

The Court of Justice of the EU (‘CJEU’) has held that an exclusive choice of forum clause can validly be imposed by so-called “click-wrap” contracts in online B2B transactions (see Case C‑322/14, El Majdoub v. CarsOnTheWeb.Deutschland GmbH).   The ruling will make it easier for online businesses in the EU to impose a favorable choice of forum in their online B2B contracts, ensuring that they can sue defendants in courts of their own choosing, rather than the defendants’ local courts.

The general EU-wide rule for B2B contractual disputes is that a defendant must be sued in its local courts only (see “Brussels I” Regulation (Regulation (EC) No 44/2001)).  However, parties can waive the default rule by agreement “in writing” (Article 23(1)).

To deal with contracts concluded electronically, Article 23(2) states – in the English version of the law – that any “electronic communication” that “provides” a durable record of the agreement is equivalent to “writing”; the French and German versions refer to the mere “possibility” of a durable record being formed.

There has been some uncertainty as to whether mere hyperlinking to terms and conditions is a “communication”.  The case before the Court focused on this point, with the claimant arguing that the relevant terms and conditions should at least have been displayed (automatically) before they placed their order.

Taking a pragmatic view, the CJEU stated that the requirements of Article 23 are met if it is possible to print and save the text of online terms and conditions before a contract is concluded – even if the contractual terms are never actually displayed to the person accepting them.  Providing a hyperlink to a printable version suffices.

Although the Brussels I Regulation has been phased out (as of January 10th, 2015, in favor of the ‘recast’ “Brussels Ia” Regulation (Regulation (EU) No 1215/2012)), it is likely that the CJEU’s ruling in El Majdoub will equally apply to the new law, given that the relevant provisions of the new law (now contained in Article 25) are in effect identical to those in Article 23 of the original.Continue Reading Court of Justice of the EU Upholds Exclusive Jurisdiction Clauses in B2B ‘Click-wrap’ Contracts

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.Continue Reading EU Member States Can Impose Copyright Levies on Devices such as Scanners, PCs, and Printers, Says CJEU