Thursday, 17 November 2016

The CJEU decision in Soulier: what does it mean for laws other than the French one on out-of-print books?

The late Marc Soulier,
also known as Ayerdhal
As reported by this blog through a breaking news post, yesterday the Court of Justice of the European Union (CJEU) issued its decision in Soulier and Doke, C-301/15.

This was a reference for a preliminary ruling from the French Conseil d’État (Council of State) and concerned the compatibility with EU law [read: the InfoSoc Directiveof the 2012 French law to allow and regulate the digital exploitation of out-of-print 20th century books.

As explained more at length hereby introducing into the French Code de la propriété intellectuelle (CPI) a new chapter [Chapter IV - Articles L 134-1 to L 134-9, subsequently amended] to Title III of Book I, this piece of legislation has vested approved collecting societies with the right to authorise the reproduction and the representation in digital form of out-of-print books, while allowing the authors of those books, or their successors in title, to oppose or put an end to that practice subject to certain conditions. 

More specifically, the relevant implementing decree has established a legal framework intended to encourage the digital exploitation of works reproduced in books published in France before 1 January 2001 which are no longer commercially distributed by a publisher and are not published in print or digital format. In that case the right to authorise the reproduction or performance of those books in digital format is exercised, six months after their registration in a publicly accessible database for which the National Library of France is responsible, by collecting societies approved to do so by the Ministry of Culture.

In yesterday's post, I expressed the view that this new CJEU decision might have far-reaching implications, that go well beyond the sole piece of legislation at the centre of the case.

After reading the decision, this seems indeed to be the case.

What the CJEU said

Preliminary remarks

In its 53-paragraph decision, also clarifying that the case had nothing to do with copyright exceptions [so that, in line with the Opinionhere, of Advocate General (AG) Wathelet, Article 5 of the InfoSoc Directive would be irrelevant], the Court noted that the national legislation at issue would call into consideration: (1) the right of reproduction within the meaning of Article 2(a) of the InfoSoc Directive; and (2) the right to authorise the representation under that form and that such a representation constitutes a communication to the public within the meaning of Article 3(1) of that directive.

The actual question referred by the French court should be therefore read as asking whether Article 2(a) and Article 3(1) of the InfoSoc Directive preclude national legislation that gives an approved collecting society the right to authorise the reproduction and communication to the public, in digital form, of out-of-print books, while allowing the authors of those books or their successors in title to oppose or put an end to that practice on the conditions that that legislation lays down.

The other author
at the centre of the case:
Sara Doke
Broad and preventive rights

The Court noted at the outset that the protection conferred by Articles 2(a) and 3(1) of the InfoSoc Directive must be given a broad interpretation. It follows [para 31] that, in line with the Berne Convention, “that protection must be understood, in particular, as not being limited to the enjoyment of the rights guaranteed by Article 2(a) and Article 3(1) of Directive 2001/29, but as also extending to the exercise of those rights.”

The Court then recalled that [para 33] such exclusive rights are preventive in nature, in the sense that any reproduction or communication to the public of a work by a third party requires the prior consent of its author.

The most straightforward consequence of this is that [para 34], subject to the exceptions and limitations laid down exhaustively in Article 5, any use of a work carried out by a third party without such prior consent (of the author) must be regarded as infringing copyright in that work. 

The form and substance of consent

This said, the Court conceded [para 35] that neither Article 2(a) nor Article 3(1) specify the way in which the prior consent of the author must be expressed: those provisions do not require such consent to be necessarily expressed explicitly. Hence, those provisions also allow that consent to be expressed implicitly. An example - said the Court - is what happens in the case of communication to the public in an online environment with the (psychological) notion of ‘new public’ [para 36], as adopted in Svensson.

However, [paras 37-40]

[T]he objective of increased protection of authors to which recital 9 of Directive 2001/29 refers implies that the circumstances in which implicit consent can be admitted must be strictly defined in order not to deprive of effect the very principle of the author’s prior consent.

In particular, every author must actually be informed of the future use of his work by a third party and the means at his disposal to prohibit it if he so wishes.

Failing any actual prior information relating to that future use, the author is unable to adopt a position on it and, therefore, to prohibit it, if necessary, so that the very existence of his implicit consent appears purely hypothetical in that regard.

Consequently, without guarantees ensuring that authors are actually informed as to the envisaged use of their works and the means at their disposal to prohibit it, it is de facto impossible for them to adopt any position whatsoever as to such use.”

Having said so, the Court turned to consideration of the French law, and noted how that legislation does not appear to offer a mechanism ensuring that authors are actually and individually informed. Therefore, it is not inconceivable that some of the authors concerned are not, in reality, even aware of the envisaged use of their works and, therefore, that they are not able to adopt a position, one way or the other, on it. In those circumstances, a mere lack of opposition on their part cannot be regarded as the expression of their implicit consent to that use.

Writer's block for Merpel
But initiatives on out-of-commerce works are not completely out

In all this, the Court did not place an absolute ban on future legislative interventions based on the InfoSoc Directive [and it would seem also on other pieces of legislation, eg the recent proposal of the EU Commission for a Directive on copyright in the Digital Single Markethere]. In fact [para 45]:

Admittedly, Directive 2001/29 does not preclude national legislation, such as that at issue in the main proceedings, from pursuing an objective such as the digital exploitation of out-of-print books in the cultural interest of consumers and of society as a whole. However, the pursuit of that objective and of that interest cannot justify a derogation not provided for by the EU legislature to the protection that authors are ensured by that directive.”

Removing consent

The Court also added that the InfoSoc Directive does not prohibit Member States from granting certain rights or certain benefits to third parties, such as publishers, as long as those rights and benefits do not harm the rights which that directive gives exclusively to authors. 

When the author of a work decides to put an end to the future exploitation of that work in a digital format, that right must be capable of being exercised:

a)  without having to depend, in certain cases, on the concurrent will of persons other than those to whom that author had given prior authorisation to proceed with such a digital exploitation and, thus, on the agreement of the publisher holding only the rights of exploitation of that work in a printed format [para 49]; and
b)  without being subject to any particular formality [para 50].

In conclusion

Article 2(a) and Article 3(1) of the InfoSoc Directive must be interpreted as precluding national legislation that gives an approved collecting society the right to authorise the reproduction and communication to the public in digital form of ‘out-of-print’ books, namely, books published in France before 1 January 2001 which are no longer commercially distributed by a publisher and are not currently published in print or in digital form, while allowing the authors of those books, or their successors in title, to oppose or put an end to that practice, on the conditions that that legislation lays down.

Comment

Yesterday’s decision marked an important moment in CJEU copyright jurisprudence. 

Any freedom left?
From an EU perspective

Although the Court relied on concepts also employed in previous decisions [eg that economic rights must be interpreted broadly and considered preventive in nature], it used the so called author principle [ie the principle that, as a general rule, the author is also the first owner of copyright] to push the boundaries of EU harmonisation further and, by doing so, restrict Member States' legislative freedom.

First, despite contrasting hints in the past in which the CJEU appeared to employ the terms 'authors' and 'rightholders' interchangeably, the Court reinforced the idea that who the InfoSoc Directive intends to grant a 'high level of protection' to is authors.

Secondly, although not referring explicitly to the notion of EU preemption [on which see also here], the CJEU fully embraced it. In this sense, there is no gap between the CJEU judgment and the AG Opinion [paras 55-57], which rejects the view that the national legislation at issue would not affect the protection of copyright because it simply constitutes an arrangement for managing certain rights which the InfoSoc Directive does not preclude. What matters - for both the CJEU and the AG - is whether authors have had the possibility to express their individual consent. 

From a practical perspective

It would appear that, post-Soulier and lacking specific 'EU-endorsed authorisation' to the contrary, national legislative initiatives (including licensing schemes) that fail to incorporate appropriate and streamlined procedures to (1) inform authors of possible future uses of their works, and (2) obtain their relevant, individual, consent are likely to be regarded as incompatible with EU law.

In light of all this one may wonder whether another piece of French legislation, ie the law on freedom of creation, architecture and cultural heritage, is against EU law. 

As this blog reported, among other things this introduced new provisions [Articles L 136-1 to 136-4] into the CPI to regulate the exercise of the exclusive rights of reproduction and representation vis-à-vis automated image referencing services. Article 136-2(1) CPI clarifies that the publication of a plastic artwork, graphic or photographic work by an online communication service is subject to the consent - not of authors - but rather one or more collecting societies appointed to this end by the French Ministry of Culture. It would appear that an author only has the right to indicate which collecting society would undertake this task (lacking such indication, then a presumption would operate in favour of a designated collecting society), but not also authorise the relevant collecting society to authorise the making of acts restricted by copyright.

On a similar note, as suggested by Sylvie Nérisson on the Kluwer Copyright Blog at the time of the AG Opinon, also certain national licensing schemes - including systems of extended collective licensing - may fall short of what EU law requires in terms of authors' consent.  

All in all ... a subtle message from the CJEU
Turning now to the provisions on out-of-commerce works as contained in the recently proposed Directive on copyright in the Digital Single Market, Article 7(1) states that:

"Member States shall provide that when a collective management organisation, on behalf of its members, concludes a non-exclusive licence for non-commercial purposes with a cultural heritage institution for the digitisation, distribution, communication to the public or making available of out-of-commerce works or other subject-matter permanently in the collection of the institution, such a non-exclusive licence may be extended or presumed to apply to rightholders of the same category as those covered by the licence who are not represented by the collective management organisation, provided that: 

(a) the collective management organisation is, on the basis of mandates from rightholders, broadly representative of rightholders in the category of works or other subject-matter and of the rights which are the subject of the licence; 
(b) equal treatment is guaranteed to all rightholders in relation to the terms of the licence; 
(c) all rightholders may at any time object to their works or other subject-matter being deemed to be out of commerce and exclude the application of the licence to their works or other subject-matter."

One may question whether the extension of the licence also to non-members and the fact that the mechanism envisaged by the proposed directive is opting-out rather than opting-in, is fully compliant with Soulier.

A conclusion of the conclusion

In all this, yesterday's CJEU decision does not necessarily mean the end for all these sorts of initiatives - whether at the national or EU levels. 

However, what is (now?) required is a more careful approach by relevant legislators to ensure that the principles established at the level of the InfoSoc Directive and elaborated further in yesterday's CJEU decision are fully respected. 

As a final note - although the CJEU did not bring fundamental rights into the picture this time - as I also discussed here, these may matter in a situation in which authors are deprived of their ability to authorise the making of acts restricted by copyright. In fact, it may be argued that all this could amount to a deprivation of authors' fundamental right to intellectual property protection, as per Article 17(2) of the Charter of Fundamental Rights of the European Union

Wednesday, 16 November 2016

BREAKING: CJEU follows AG and holds French law on out-of-print books contrary to EU law

Is a national law that provides ab initio that a collecting society - rather than the author of a work - has the right to authorise the reproduction and communication to the public of such work compatible with EU law?

This - in a nutshell - is the question at the centre of what is probably [of course, after GS Media, on which see the string of IPKat posts here] the most important copyright case of the year at the Court of Justice of the European Union (CJEU): Soulier and Doke, C-301/15.

Why this case matters

The reason is soon explained: this reference for a preliminary ruling from the French Conseil d’État is not just a case concerning the compatibility with EU law of the French loi (Law No 2012-287 of 1 March 2012) to allow and regulate the digital exploitation of out-of-print 20th century books, but - more generally - a case that questions the actual freedom of Member States to legislate independently on copyright issues. 

As this blog reported, in fact, the outcome of this decision has the potential to have far-reaching implications. 

An immediate example is another piece of French legislation, ie Loi No 2016-925 on freedom of creation, architecture and cultural heritage [this - among other things - has introduced new provisions, Articles L 136-1 to 136-4 into the Code de la propriété intellectuelle (CPI) to regulate the exercise of the exclusive rights of reproduction and representation vis-à-vis automated image referencing services]

A further case might be - as suggested by Sylvie Nérisson on the Kluwer Copyright Blog - a number of statutory collective management schemes, including extended collective licensing.

Finally, it might have a broader, policy relevance, in that the recently proposed Directive on copyright in the Digital Single Market [herecontains specific provisions on out-of-commerce works.


All this said, what was Soulier about?

Background

In 2012 France adopted a piece of legislation that amended the French Code de la propriété intellectuelle by adding a new chapter (Chapter IV - Articles L 134-1 to L 134-9, subsequently amended) to Title III of Book I therein. 

Among other things, this French law gives approved collecting societies the right to authorise the reproduction and the representation in digital form of out-of-print books, while allowing the authors of those books, or their successors in title, to oppose or put an end to that practice subject to certain conditions. 

More specifically, the relevant implementing decree has established a legal framework intended to encourage the digital exploitation of works reproduced in books published in France before 1 January 2001 which are no longer commercially distributed by a publisher and are not published in print or digital format. In that case the right to authorise the reproduction or performance of those books in digital format is exercised, six months after their registration in a publicly accessible database for which the National Library of France is responsible, by collecting societies approved to do so by the Ministry of Culture.

But is an arrangement of this kind compatible with EU law, notably the InfoSoc Directive? Among other things, Article 2(a) and 3(1) of that directive, in fact, provide authors - not collecting societies - with the right to authorise the reproduction and communication to the public of their works [a somewhat comparable recent case in which the rightholders/authors dichotomy has been addressed - although in the context of private copying - is Reprobel, on which see here].

The applicants in the national proceedings lodged an application with the Conseil d’État, seeking the annulment for misuse of powers of Law No 2012-287 implementing decree, on grounds that the Law on out-of-print books is not compatible with the limitations and exceptions to the right to authorise the reproduction of a copyright work which are exhaustively set out in the InfoSoc Directive.

Further to a reference to the Conseil constitutionnel in 2013 regarding the compatibility of Law No 2012-287 with the French Constitution [in 2014 the Conseil constitutionnel responded in the sense of its compatibility], the 
Conseil d’État decided to stay the proceedings and refer the following question to the CJEU:

Do [Articles 2 and 5] of [the InfoSoc Directive] … preclude legislation, such as that [established in Articles L. 134-1 to L. 134-9 of the Intellectual Property Code], that gives approved collecting societies the right to authorise the reproduction and the representation in digital form of “out-of-print books”, while allowing the authors of those books, or their successors in title, to oppose or put an end to that practice, on the conditions that it lays down?’

Out-of-print or just out-of-energy?
The AG Opinion

In his Opinion [hereon 7 July 2016, Advocate General (AG) Wathelet [yes, the same AG of GS Media] advised the CJEU to rule in the sense of the incompatibility of the French law with EU law.

Having clarified what provisions need to be considered [not exceptions and limitations, said the AG] and recalled the rationale [high protection of authors] and interpretation of InfoSoc provisions ['autonomous' and 'uniform' where no express reference is made to Member States' laws], the AG held [paras 38-39] that: 

"Article 2(a) and Article 3(1) of Directive 2001/29 [yes, the InfoSoc Directive] require the prior express consent of the author for any reproduction or communication to the public of his work, including in digital format. That consent constitutes an essential prerogative of authors.

In the absence of any derogating EU legislation, the author’s express and prior consent for the reproduction or communication to the public of his work cannot be eliminated, assumed or limited by substituting it with tacit consent or a presumed transfer which the author must oppose within a fixed time limit and in accordance with conditions laid down by national law. It follows that national legislation like the decree at issue, which replaces the author’s express and prior consent with tacit consent or a presumption of consent, deprives the author of an essential element of his intellectual property rights."

The AG added that none of the following characteristics of the French law alter such finding, ie: the possibility of opposition and withdrawal; the right to remuneration, and the absence of commercial distribution of the work to the public. 

The AG also rejected the argument that the legislation at issue would not affect the protection of copyright because it simply constitutes an arrangement for managing certain rights which Article 2(a) and Article 3(1) of the InfoSoc Directive do not preclude. 

Today's decision

In today's decision, the CJEU held that the InfoSoc Directive precludes national legislation authorising the digital reproduction of out-of-print books. According to the Court, national legislation must guarantee the protection accorded to authors by the directive and ensure, in particular, that they are actually informed of the envisaged digital exploitation of their work, while being able to put an end to it without formalities.

The decision is not yet available on the Curia website, but according to the press release:


“In today’s judgment, the Court of Justice notes that, subject to the exceptions and limitations expressly provided for in the directive, authors have the exclusive right to authorise or prohibit the reproduction and communication to the public of their works.

However, it holds that the prior consent of an author to the use of one of his works can, under certain conditions, be expressed implicitly. For the existence of such consent to be accepted, the Court considers, in particular, that every author must be informed of the future use of his work by a third party and of the means at his disposal to prevent it if he so wishes.

The French legislation, as it currently stands, provides that the right to authorise the digital exploitation of out-of-print books is transferred to the SOFIA [an approved collecting society] when the authors do not oppose it within a period of six months after the registration of their books in a database established to that effect.

The Court states that the Conseil d’État has not shown that this legislation included a mechanism ensuring authors are actually and individually informed. It is not therefore inconceivable, according to the Court, that some of the authors concerned are not aware of the envisaged use of their works and, consequently, are not able to adopt a position on it. In those circumstances, a mere lack of opposition on their part cannot be regarded as the expression of their implicit consent to the use of their works, especially since it cannot reasonably be presumed that, without opposition on their part, every author of ‘forgotten’ books is in favour of the ‘resurrection’ of those works, in view of their commercial use in a digital format. 

The Court adds that the pursuit of the objective enabling the digital exploitation of out-of-print books in the cultural interest of consumers and of society, while compatible with the directive as such, cannot justify a derogation not provided for by the EU legislature from the protection that authors are ensured by the directive. Furthermore, the Court states that the French legislation enables authors to put an end to the commercial exploitation of their works in digital format either by mutual agreement with the publishers of those works in printed format or alone, on condition that they provide evidence that they alone hold the rights in their works. The Court declares, in this respect, that the right of the author to put an end to the future exploitation of his work in a digital format must be capable of being exercised without having to depend on the concurrent agreement of persons other than those to whom the author had given prior authorisation to proceed with such a digital exploitation and, thus, on the agreement of the publisher holding only the rights of exploitation of that work in a printed format. Moreover, the author of a work must be able to put an end to the exercise of rights of exploitation of that work in digital format without having to submit beforehand to any additional formalities.”

A more detailed analysis will be provided once the decision has been made available: stay tuned!


[Originally published on The IPKat on 16 November 2016]

Thursday, 10 November 2016

BREAKING: CJEU says that EU law allows e-lending

Are libraries allowed to lend electronic books in their collections under the Rental and Lending Rights Directive? If so, under what conditions? Is there such thing as digital exhaustion under the InfoSoc Directive?

These were the questions in Vereniging Openbare Bibliotheken v Stichting Leenrecht, C-174/15, a reference for a preliminary ruling to the Court of Justice of the European Union (CJEU) from the Rechtbank Den Haag (District Court of The Hague, Netherlands). 


As reported by this blog, this reference arose in the context of proceedings brought by the association of Dutch public libraries which - contrary to the position of Dutch government - holds the view that libraries should be entitled to lend electronic books included in their collections according to the principle "one copy one user". 


This envisages the possibility for a library user to download an electronic copy of a work included in the collection of a library with the result that - as long as that user "has" the book - it is not possible for other library users to download a copy. Upon expiry of the e-lending period, the electronic copy downloaded by the first user becomes unusable, so that the book in question can be e-borrowed by another user. 


The AG Opinion

In his Opinion on 16 June last, 
Advocate General (AG) Maciej Szpunar advised the CJEU to rule that Article 1(1) of the Rental and Lending Rights Directive must be interpreted in the sense of including the right to lend electronic books included in a library's own collection. Although the AG held the view that the issue of digital exhaustion under the InfoSoc Directive is unrelated from that of whether libraries can e-lend, he provided some interesting hints in this respect. 


At the time of the Opinion, I highlighted how the AG discussed the role of libraries and - similarly to a more recent Opinion [hereof AG Szpunar (once again on the Rental and Lending Rights Directive) - stressed how [para 27] "it is imperative to give legal acts an interpretation which takes into account developments in technology, markets and behaviour and not to fix such acts in the past by adopting too rigid an interpretation."


Milly is worried:
what would be of her favourite hiding place
if all books became electronic?
Today's decision

In today's judgment the CJEU appeared to confirm the AG's analysis [the judgment is not yet available on the Curia website, but the press release is]

According to the press release: 

"The lending of an electronic book (e-book) may, under certain conditions, be treated in the same way as the lending of a traditional book. 

In such a situation, the public lending exception, which provides inter alia for the fair remuneration of authors, is applicable. 

... 

In today’s judgment, the Court of Justice first notes that there is no decisive ground allowing for the exclusion, in all cases, of the lending of digital copies and intangible objects from the scope of the directive. That conclusion is, moreover, borne out by the objective pursued by the directive, namely that copyright must adapt to new economic developments. In addition, to exclude digital lending entirely from the scope of the directive would run counter to the general principle that a high level of protection is required for authors. 

The Court then goes on to verify whether the public lending of a digital copy of a book under the ‘one copy, one user’ model is capable of coming within the scope of Article 6(1) of the directive. 

In that respect, the Court notes that, given the importance of the public lending of digital books, and in order to safeguard both the effectiveness of the exception for public lending referred to in Article 6(1) of the directive and the contribution of that exception to the promotion of culture, it cannot be ruled out that that article may apply where the operation carried out by a publicly accessible library, in view of, inter alia, the conditions set out in Article 2(1)(b) of that directive, has essentially similar characteristics to the lending of printed works. That is the case as regards the lending of a digital copy of a book under the ‘one copy, one user’ model. 

The Court therefore holds that the concept of ‘lending’, within the meaning of the directive, also covers lending of this kind. 

The Court also notes that the Member States may lay down additional conditions capable of improving the protection of authors’ rights beyond what is expressly laid down in the directive. In the present case, the Netherlands legislation requires that the digital copy of a book made available by the public library must have been put into circulation by a first sale or other transfer of ownership of that copy in the EU by the holder of the right of distribution to the public or with that holder’s consent. According to the Court, such an additional condition must be considered to be in accordance with the directive. 

Concerning the case where an electronic copy of a book has been obtained from an unlawful source, the Court emphasises that one of the objectives of the directive is to combat piracy and points out that allowing the lending of such a copy would be liable unreasonably to prejudice copyright holders. Consequently, the public lending exception does not apply to the making available by a public library of a digital copy of a book in the case where that copy has been obtained from an unlawful source."

An initial comment

A more detailed analysis will be provided as soon as the judgment is available. In the meantime, it is worth noting that: 

(1) not only is the judgment good news for libraries, but 
(2) unlike what has been held by a number of leading commentators, the Rental and Lending Rights Directive allows e-lending. In this respect, it will be interesting to see whether the CJEU (similarly to the AG) also referred to the need for an interpretation of legal norms that takes into account technological advancement.

Finally, it is not clear from the text of the press release whether the CJEU addressed digital exhaustion. If not, whether this is allowed under the InfoSoc Directive remains unclear.

[Originally published on The IPKat on 10 November 2016]