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

• Jurisdiction: European Union
• Court: Court of Justice (European Union)
• Writing for the Court: Malenovský
• ECLI: ECLI:EU:C:2010:264
• Docket Number: C-467/08
• Date: 11 May 2010
• Procedure Type: Reference for a preliminary ruling

OPINION OF ADVOCATE GENERAL

TRSTENJAK

delivered on 11 May 2010 ¹(1)

Case C‑467/08

Sociedad General de Autores y Editores (SGAE)

v

Padawan S. L.

(Reference for a preliminary ruling from the Audiencia Provincial de Barcelona (Spain))

(Directive 2001/29/EC – Copyright and related rights – Article 2 – Reproduction right – Article 5(2)(b) – Exceptions and limitations – Fair compensation – Scope – Levy system in respect of digital reproduction equipment, devices and media)

I – Introduction

1. The invention of printing by Johannes Gutenberg in approximately 1450 constituted a culturally and historically significant turning point in the history of Europe and the world. This event, which involved the introduction of a new method of reproduction and at first sight only had technical relevance, was able to bring about a media revolution which led to the notable flourishing of European intellectual life. It facilitated access to information and education, namely by means of the exact reproduction of knowledge to an extent never previously known and within the means of more and more citizens. This aided mass dissemination and a lively exchange of ideas, which paved the way to the cultural age of the Renaissance and later to the Age of Enlightenment. At the same time, authorship gained significance, since the question of who had written what and in what factual and temporal context became more and more important. From this, arose the necessity to effectively protect the right of authors in their works and the rights of printers and publishers involved in producing printed works. In this way, the basic idea of copyright law came into being. In retrospect, the problems linked to the control of reproductions of literary and artistic works turn out to be just as old as the technical methods of producing those reproductions themselves. (2) As the present case shows, these problems have gained in topicality, especially since technological development up to the digital age has given rise to new methods and devices which make it possible for every person to save data digitally, to amend it and to reproduce it at will. The legislature and the judge have the sensitive task of developing appropriate solutions to these new challenges which should take into account the interests of the author and the user to the same extent.

2. In the present reference for a preliminary ruling under Article 234 EC, (3) the Audiencia Provincial de Barcelona (Provincial Court, Barcelona; ‘the referring court’) submits a series of questions to the Court concerning the interpretation of the concept of ‘fair compensation’, mentioned 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, (4) to which, pursuant to this exception to the rule, the rightholders of any copyright are entitled in the event of the reproduction of a work or other subject-matter for private use.

3. These questions arise in the context of proceedings in which the Sociedad General de Autores y Editores de España (SGAE; ‘the claimant in the main proceedings’), a Spanish intellectual property rights management society, is bringing a claim against the company Padawan S. L. (‘the defendant in the main proceedings’) for payment of flat-rate compensation for private copying in respect of storage media marketed by it during a precisely defined period.

II – Legislative framework

A – European Union law

4. Recital 10 in the preamble to Directive 2001/29 states:

‘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. The investment required to produce products such as phonograms, films or multimedia products, and services such as “on‑demand” services, is considerable. Adequate legal protection of intellectual property rights is necessary in order to guarantee the availability of such a reward and provide the opportunity for satisfactory returns on this investment.’

5. Recital 31 is worded as follows:

‘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. The existing exceptions and limitations to the rights as set out by the Member States have to be reassessed in the light of the new electronic environment. Existing differences in the exceptions and limitations to certain restricted acts have direct negative effects on the functioning of the internal market of copyright and related rights. Such differences could well become more pronounced in view of the further development of transborder exploitation of works and cross-border activities. In order to ensure the proper functioning of the internal market, such exceptions and limitations should be defined more harmoniously. The degree of their harmonisation should be based on their impact on the smooth functioning of the internal market.’

6. Recital 32 contains the following statement:

‘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, which will be assessed when reviewing implementing legislation in the future.’

7. Recital 35 is worded as follows:

‘In certain cases of exceptions or limitations, rightholders should receive fair compensation to compensate them adequately for the use made of their protected works or other subject-matter. When determining the form, detailed arrangements and possible level of such fair compensation, account should be taken of the particular circumstances of each case. When evaluating these circumstances, a valuable criterion would be the possible harm to the rightholders resulting from the act in question. In cases where rightholders have already received payment in some other form, for instance as part of a licence fee, no specific or separate payment may be due. The level of fair compensation should take full account of the degree of use of technological protection measures referred to in this Directive. In certain situations where the prejudice to the rightholder would be minimal, no obligation for payment may arise.’

8. Recital 38 states inter alia:

‘Member States should be allowed to provide for an exception or limitation to the reproduction right for certain types of reproduction of audio, visual and audiovisual material for private use, accompanied by fair compensation. This may include the introduction or continuation of remuneration schemes to compensate for the prejudice to rightholders.’

9. Article 2 of Directive 2001/29 states as follows:

‘Reproduction right

Member States shall provide for the exclusive right to authorise or prohibit direct or indirect, temporary or permanent reproduction by any means and in any form, in whole or in part:

(a) for authors, of their works;

(b) for performers, of fixations of their performances;

(c) for phonogram producers, of their phonograms;

(d) for the producers of the first fixations of films, in respect of the original and copies of their films;

(e) for broadcasting organisations, of fixations of their broadcasts, whether those broadcasts are transmitted by wire or over the air, including by cable or satellite.’

10. Article 5(2)(b) of the directive provides as follows:

‘Exceptions and limitations

…

2. Member States may provide for exceptions or limitations to the reproduction right provided for in Article 2 in the following cases:

…

(b) in respect of reproductions on any medium made by a natural person for private use and for ends that are neither directly nor indirectly commercial, on condition that the rightholders receive fair compensation which takes account of the application or non-application of technological measures referred to in Article 6 to the work or subject‑matter concerned.’

B – National law

11. According to the information provided by the referring court, Article 2 of Directive 2001/29 was implemented under national law by Article 17 of the consolidated version of the Law on Intellectual Property (Texto Refundido de la Ley de Propiedad Intelectual; ‘TRLPI’) which was approved by the Real Decreto Legislativo (Royal Legislative Decree) 1/1996 of 12 April 1996, which provides that ‘[t]he author has exclusive rights of exploitation of his works regardless of their form and, in particular, reproduction rights …which cannot be exercised without his permission except in circumstances laid down in this Law’, and by the following articles which extend that reproduction right to other holders of intellectual property rights.

12. Article 18 of the TRLPI specifies that reproduction means: ‘the fixation of the work on a medium which enables communication of the work and copying of the whole or part of the work’.

13. In accordance with Article 5(2)(b) of Directive 2001/29, Article 31(1)(2) of the TRLPI provides that works which have already been circulated may be reproduced without the author’s permission for ‘private use by the copier without prejudice to Articles 25 and 99(a) of this Law, provided that usage of the copy is not collective or for profit’.

14. The version of Article 25 of the TRLPI which preceded Amending Law No 23/2006 of 7 July 2006 (5) lays down highly detailed rules governing the compensation to which the holders of intellectual property rights are entitled in respect of reproductions made...