Referred questions

The questions referred to the ECJ were:

• (1) Does the operator of a video sharing platform like YouTube carry out an act of communication within the meaning of article 3(1) of Directive 2001/29/EC (the Copyright Directive) where infringing content is made publicly accessible and the operator is not specifically aware of the availability of the infringing content, or, on becoming aware, deletes or disables access to the content expeditiously? This question was in relation to the following conditions: if (a) the operator earns advertising revenue through the platform; (b) the uploading process is automatic and the content is not seen or monitored in advance by the operator; (c) the operator receives a worldwide, non-exclusive and royalty-free licence for the content when it is available on the platform; (d) in the terms of service, the operator states that users shall not upload copyright-infringing content; (e) the operator provides tools which allow right holders to block infringing videos; and (f) the platform prepares search results organised into rankings and content categories, and recommends videos to users on the basis of videos previously watched by those users.
• If the answer to (1) is no, (2) does the activity described in the above conditions come within the scope of article 14(1) of Directive 2000/31/EC (the E-Commerce Directive)?
• If the answer to (2) is yes, (3) must actual knowledge of the infringing content and awareness of the circumstances from which the infringing content is apparent relate to specific illegal activities or information pursuant to article 14(1); and (4) is it compatible with article 8(3) of the Copyright Directive if the right holder can obtain an injunction against the service provider where content uploaded by users infringes copyright or a related right, and the infringement has been repeated despite notification of a clear infringement being made?
• If the answer to (1) and (2) is no, (5) is the operator under the conditions in (1) to be regarded as an infringer within the meaning of article 11 and article 13 of Directive 2004/48/EC?
• If yes, (6) is the operator required to pay damages under article 13(1), for both its own illegal activity and the illegal activity of its users, if the operator knew or ought to have reasonably known that users were uploading infringing content onto the platform?

Decision

The requests primarily concerned the interpretation of ‘communication to the public’ under article 3(1), and the availability of injunctions against intermediaries under article 8(3), of the Copyright Directive, and the exemption liability under article 14(1) of the E-Commerce Directive.

The ECJ ruled as follows:

• Communication to the public’ under article 3(1) of the Copyright Directive
  • The operator of a video sharing or file hosting and sharing platform does not make a communication to the public unless it “contributes, beyond merely making that platform available, to giving access to such content to the public”. This has an element of knowledge, including assessing whether the platform’s intervention in the illegal communication of the protected content is deliberate. The court did not comment on whether any allegedly high proportion of protected content available in the platform can be taken into account when assessing the deliberate nature.
  • ‘Contribute’ means: (i) when the operator “has specific knowledge that protected content is available illegally” but “refrains from expeditiously deleting it or blocking access to it”; or (ii) when the operator “knows or ought to know, in a general sense” that users are using the platform for illegal content but “refrains from putting in place the appropriate technological measures that can be expected from a reasonably diligent operator” in order to “counter credibly and effectively copyright infringements”; or (iii) where the operator participates in selecting the protected content, it “provides tools on its platform specifically intended for the illegal sharing of such content or knowingly promotes such sharing”. This includes adopting a financial model that encourages the illegal sharing of content.

• Exemption from liability under article 14(1) of the E-Commerce Directive
  • The activity of the operator of a video sharing or file hosting and sharing platform falls within the scope if it does not have an “active role” of a kind that “give[s] it knowledge of or control over the content uploaded to its platform”. The operator is considered to have no knowledge of or control if its activity is of a “mere technical, automatic and passive nature”.
  • To be excluded from the exemption of liability, the operator “must have knowledge of or awareness of specific illegal acts committed by its users relating to protected content that was uploaded to its platform”.

• Availability of injunctions against intermediaries under article 8(3) of the Copyright Directive
  • Article 8(3) does not preclude the situation under national law whereby a right holder may not obtain an injunction against an intermediary if that intermediary has no knowledge or awareness of the infringement, unless before the commencement of legal proceedings it has been notified of, and failed to expeditiously remove or block access to, the content.

Article 17 of the DSM Directive

It is important to note that this case concerns the Directives applicable at the time of the proceedings and not article 17 of Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC (the DSM Directive).

Article 17 of the DSM Directive applies to certain ‘online content-sharing service providers’ who store and give public access to a large amount of copyright content uploaded by their users which they organise and promote for profit-making purposes. Article 17 provides that online content sharing platforms will be liable for copyright-protected material uploaded by users and must obtain authorisation from the relevant right holders. To be exempt from the liability, the online content-sharing service providers must comply with applicable requirements, including the need to make “best efforts” to: (i) obtain the necessary authorisation; (ii) expeditiously take down or disable access to content upon receiving sufficient notice; (iii) prevent future uploads of such content; and/or (iv) ensure the unavailability of specific content for which the right holders have provided the “relevant and necessary information”.

Conclusion

Although the decision of the ECJ might not be as useful now that the DSM Directive is being transposed into national law, it is nevertheless helpful guidance for video sharing platforms and arguably continues to enable them to benefit from the long-standing safe harbour laws that have been so controversial for right holders, until such time as article 17 is transposed. It is worth noting that the UK decided not to implement the DSM Directive, and the Court of Justice of the European Union decision on the Polish challenge to article 17 is still awaited.

There are some common themes for content sharing platforms to take away from the ECJ’s decision and article 17. In order to operate in accordance with best practices, platforms should:

• Observe and maintain a fair balance between the interests of right holders and the freedom of expression and of information;
• Put in place clear terms of service, guidelines, and warnings that no copyright-infringing content is allowed;
• Act expeditiously to remove illegal content upon receipt of take down notices that contain sufficient information, with due regard to the principle of freedom of expression;
• Develop and utilise technological measure to prevent copyright-infringing content;
• Set up procedures for reporting and arranging the removal of such content;
• Utilise content verification and recognition software to facilitate the identification and designation of such content; and
• Consider implementing upload filters.

1. Joined cases C-682/18 and C-683/18, Frank Peterson and Elsevier Inc. v. Google LLC and Others (22 June 2021).
2. Article 17 of the Directive (EU) 2019/790 of the European Parliament and of the Council of 17 April 2019 on copyright and related rights in the Digital Single Market and amending Directives 96/9/EC and 2001/29/EC.

Client Alert 2021-180