Padawan SL v Sociedad General de Autores y Editores de España (SGAE).

• Jurisdiction: European Union
• Celex Number: 62008CJ0467
• ECLI: ECLI:EU:C:2010:620
• Docket Number: C-467/08
• Date: 21 October 2010
• Court: Court of Justice (European Union)
• Procedure Type: Reference for a preliminary ruling

Case C-467/08

Padawan SL

v

Sociedad General de Autores y Editores de España (SGAE)

(Reference for a preliminary ruling from the

Audiencia Provincial de Barcelona)

(Approximation of laws – Copyright and related rights – Directive 2001/29/EC – Reproduction right – Exceptions and limitations – Private copying exception – Definition of ‘fair compensation’ – Uniform interpretation – Implementation by the Member States – Criteria – Limits – Private copying levy applied to digital reproduction equipment, devices and media)

Summary of the Judgment

1. Approximation of laws – Copyright and related rights – Directive 2001/29 – Harmonisation of certain aspects of copyright and related rights in the information society – Reproduction right

(European Parliament and Council Directive 2001/29, Art. 5(2)(b))

2. Approximation of laws – Copyright and related rights – Directive 2001/29 – Harmonisation of certain aspects of copyright and related rights in the information society – Reproduction right

(European Parliament and Council Directive 2001/29, recitals 35 and 38 and Art. 5(2)(b))

3. Approximation of laws – Copyright and related rights – Directive 2001/29 – Harmonisation of certain aspects of copyright and related rights in the information society – Reproduction right

(European Parliament and Council Directive 2001/29, Art. 5(2)(b))

1. The concept of ‘fair compensation’, within the meaning of Article 5(2)(b) of Directive 2001/29 on the harmonisation of certain aspects of copyright and related rights in the information society, is an autonomous concept of European Union law which must be interpreted uniformly in all the Member States that have introduced a private copying exception, irrespective of the power conferred on the Member States to determine, within the limits imposed by European Union law in particular by that directive, the form, detailed arrangements for financing and collection, and the level of that fair compensation.

(see para. 37, operative part 1)

2. Article 5(2)(b) of Directive 2001/29 on the harmonisation of certain aspects of copyright and related rights in the information society must be interpreted as meaning that the fair balance between the persons concerned means that fair compensation must be calculated on the basis of the criterion of the harm caused to authors of protected works by the introduction of the private copying exception. It is consistent with the requirements of that fair balance to provide that persons who have digital reproduction equipment, devices and media and who on that basis, in law or in fact, make that equipment available to private users or provide them with copying services are the persons liable to finance the fair compensation, inasmuch as they are able to pass on to private users the actual burden of financing it.

In that connection, given the practical difficulties in identifying private users and obliging them to compensate rightholders for the harm caused to them, and bearing in mind the fact that the harm which may arise from each private use, considered separately, may be minimal and therefore does not give rise to an obligation for payment, as stated in the last sentence of recital 35 in the preamble to Directive 2001/29, 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.

(see paras 46, 50, operative part 2)

3. Article 5(2)(b) of Directive 2001/29 on the harmonisation of certain aspects of copyright and related rights in the information society must be interpreted as meaning that a link is necessary between the application of the levy intended to finance fair compensation with respect to digital reproduction equipment, devices and media and the deemed use of them for the purposes of private copying. Consequently, the indiscriminate application of the private copying levy, in particular with respect to digital reproduction equipment, devices and media not made available to private users and clearly reserved for uses other than private copying, is incompatible with Directive 2001/29.

On the other hand, where the equipment at issue has been made available to natural persons for private purposes it is unnecessary to show that they have in fact made private copies with the help of that equipment and have therefore actually caused harm to the author of the protected work. Those natural persons are rightly presumed to benefit fully from the making available of that equipment, that is to say that they are deemed to take full advantage of the functions associated with that equipment, including copying.

(see paras 54-55, 59, operative part 3)

JUDGMENT OF THE COURT (Third Chamber)

21 October 2010 (*)

(Approximation of laws – Copyright and related rights – Directive 2001/29/EC – Reproduction right – Exceptions and limitations – Private copying exception – Definition of ‘fair compensation’ – Uniform interpretation – Implementation by the Member States – Criteria – Limits – Private copying levy applied to digital reproduction equipment, devices and media)

In Case C‑467/08,

REFERENCE for a preliminary ruling under Article 234 EC from the Audiencia Provincial de Barcelona (Spain), made by decision of 15 September 2008, received at the Court on 31 October 2008, in the proceedings

Padawan SL

v

Sociedad General de Autores y Editores de España (SGAE),

intervening parties:

Entidad de Gestión de Derechos de los Productores Audiovisuales (EGEDA),

Asociación de Artistas Intérpretes o Ejecutantes – Sociedad de Gestión de España (AIE),

Asociación de Gestión de Derechos Intelectuales (AGEDI),

Centro Español de Derechos Reprográficos (CEDRO),

THE COURT (Third Chamber),

composed of K. Lenaerts, President of the Chamber, D. Šváby, R. Silva de Lapuerta, E. Juhász and J. Malenovský (Rapporteur), Judges,

Advocate General: V. Trstenjak,

Registrar: M. Ferreira, Principal Administrator,

having regard to the written procedure and further to the hearing on 4 March 2010,

after considering the observations submitted on behalf of:

– Padawan SL, by J. Jover Padró, E. Blanco Aymerich and A. González García, abogados,

– Sociedad General de Autores y Editores (SGAE), by P. Hernández Arroyo, J. Segovia Murúa, R. Allendesalazar Corchó and R. Vallina Hoset, abogados,

– Entidad de Gestión de Derechos de los Productores Audiovisuales (EGEDA), by J.A. Suárez Lozano and M. Benzal Medina, abogados,

– Asociación de Artistas Intérpretes o Ejecutantes – Sociedad de Gestión de España (AIE), by C. López Sánchez, abogado,

– Asociación de Gestión de Derechos Intelectuales (AGEDI), by R. Ros Fernández, procurador, and F. Márquez Martín, abogado,

– Centro Español de Derechos Reprográficos (CEDRO), by M. Malmierca Lorenzo and J. Díaz de Olarte, abogados,

– the Spanish Government, by J. López-Medel Bascones and N. Díaz Abad, acting as Agents,

– the German Government, by M. Lumma and S. Unzeitig, acting as Agents,

– the Greek Government, by E.-M. Mamouna and V. Karra, acting as Agents,

– the French Government, by G. de Bergues and B. Beaupère-Manokha, acting as Agents,

– the Portuguese Government, by L. Inez Fernandes and N. Gonçalves, acting as Agents,

– the Finnish Government, by A. Guimaraes-Purokoski, acting as Agent,

– the United Kingdom Government, by H. Walker, acting as Agent,

– the European Commission, by L. Lozano Palacios and H. Krämer, acting as Agents,

after hearing the Opinion of the Advocate General at the sitting on 11 May 2010,

gives the following

Judgment

1 This reference for a preliminary ruling concerns the interpretation of the concept of ‘fair compensation’ in Article 5(2)(b) of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society (OJ 2001 L 167, p. 10) paid to copyright holders in respect of the ‘private copying exception’.

2 The reference has been made in the course of proceedings between Padawan SL (‘Padawan’) and Sociedad General de Autores y Editores de España (‘SGAE’) concerning the ‘private copying levy’ allegedly owed by Padawan in respect of CD-R, CD-RW, DVD-R and MP3 players marketed by it.

Legal context

Directive 2001/29

3 Recitals 9, 10, 31, 32, 35, 38 and 39 in the preamble to Directive 2001/29 are worded as follows:

‘(9) Any harmonisation of copyright and related rights must take as a basis a high level of protection, since such rights are crucial to intellectual creation. Their protection helps to ensure the maintenance and development of creativity in the interests of authors, performers, producers, consumers, culture, industry and the public at large. Intellectual property has therefore been recognised as an integral part of property.

(10) If authors or performers are to continue their creative and artistic work, they have to receive an appropriate reward for the use of their work, as must producers in order to be able to finance this work …

…

(31) A fair balance of rights and interests between the different categories of rightholders, as well as between the different categories of rightholders and users of protected subject-matter must be safeguarded …

(32) This Directive provides for an exhaustive enumeration of exceptions and limitations to the reproduction right and the right of communication to the public. Some exceptions or limitations only apply to the reproduction right, where appropriate. This list takes due account of the different legal traditions in Member States, while, at the same time, aiming to ensure a functioning internal market. Member States should arrive at a coherent application of these exceptions and limitations...