The European Court of Justice (ECJ) has ruled that a national measure ordering an internet service provider to install a system for filtering and blocking electronic communications in order to protect intellectual property rights in principle infringes fundamental EU rights.
The Court considers that the installation of that filtering and blocking system is a restriction on the right to respect for the privacy of communications and the right to protection of personal data, both of which are rights protected under the Charter of Fundamental Rights, and that the deployment of such a system would restrict freedom of an ISP to conduct its business , which is also protected by the Charter of Fundamental Rights.
This decision comes as part of a long running battle between Belgian copyright society SABAM and Internet service provider Tiscali (now Belgacom’s Scarlet) . Back in 2007 the Belgian Court of First Instance ordered Scarlet to put into place blocking and filtering mechanisms to stop its users sending or receiving music through p2p applications, this was after a lower court had found the ISP liable in 2004 for the unauthorised exchange of music files through its service. SABAM had asked the court to force the ISP to use a filter from Audible Magic to screen out file-sharing traffic. However, a judge later reversed this ruling, after confusion over the purported effectiveness of Audible Magic.
Scarlet argued that and filtering technology was flawed and that even if it were not, then it was being asked to monitor all communications coming across its network in order to identify p2p traffic, which would go against EU law.
The Brussels Court of Appeal took up the case, and decided to refer the matter of whether ISPs can be compelled to filter file-sharing traffic on their networks to the ECJ
It is asked for guidance on:
1. Do Directives 2001/29 [copyright in the information society] and 2004/48 [the IP enforcement directive], read in conjunction with Directives 95/46 [on the processing of personal data], 2000/31 [the e-commerce directive] and 2002/58 [on privacy and electronic communications] and interpreted with regard to Articles 8 and 10 of the European Convention on Human Rights, allow Member States to authorize a national court, seized in a procedure on the merits and on solely on the basis of the legal provision which holds that “They [the national court] can equally impose a prohibitory injunction on intermediaries whose services are relied upon by a third party to infringe copyright or a neighbouring right”, to order an ISP to put into place, vis-a-vis all of its customers, in abstracto and as a preventive measure, at the expense of the ISP and without limitation in time, a system filtering all electronic communications, both incoming and outcoming, passing through its service, in particular by means of peer to peer software, with the aim to identify the circulation on its network of electronic files containing a musical, cinematographic or audiovisual work to which the claimant alleges to enjoy rights and to then block the transfer thereof, either at the request or at the time it is sent?
2. If question 1 is answered in the positive, do these directives require that the national court, seized to rule over a request for injunctive relief against an intermediary on whose services a third party relies to infringe a copyright, applies the principle of proportionality when it is asked to rule over the efficacy and the dissuasive effect of the requested measure?”
The court, essentially confirming the view of Advocate General (AG) Cruz Villalón, earlier this year, is clear that the injunction requiring Scarlet to install a system for filtering and blocking electronic communications in order to protect intellectual property, would require it to actively monitor all traffic across its network, which is prohibited under the e-commerce directive. It agrees that under EU law the protection of IP rights is enshrined, but stresses that nothing in the wording of the provision in the Charter of Fundamental Rights of the European Union or in the Court’s case-law to suggest that that right is inviolable and must for that reason be absolutely protected. It is a right that has to be balanced against other rights, and national authorities and courts must ensure that they strike a fair balance between conflicting rights. In this case the rights balanced are those of the content owners wanting to protect their IP rights and those of the ISP to have freedom to conduct its business. According to the court, the injunction in this case would seriously infringe the freedom of the ISP to conduct its business as it would require it to install a complicated and costly computer system at its own expense, that would have no time limitation, contrary to IP Directive.
The Court goes on the add that the effects of the injunction would also infringe the fundamental rights of the ISPs customers, in respect to protecting their personal data and their freedom to communicate. The systematic analysis of all communications traffic and the collection and identification of subscribers’ IP addresses would particularly.
Finally the court says the injunction would lead to over-blocking of content including much legal non–infringing content.
How does this judgement affect the situation in the UK? The short answer is it doesn’t really. The ECJ has primarily found that the injunction against Scarlet was too broad in that it imposed an obligation to monitor all communications – which itself would (except in limited circumstances) fall foul of the Regulation of Investigatory Powers Act (RIPA). And in theory at least, the UK’s controversial Digital Economy Act does not require ISPs to monitor communications in a manner that would contradict the provisions of RIPA.
Actions such as the recent court order forcing BT to block access to a particular site, Twentieth Century Fox Film Corp & Ors v British Telecommunications Plc (Newzbin case), is more focused and limited than what happened in the Scarlet case. Indeed, Justice Arnold considered this, then pending decision, in reaching his conclusion. he said ” I consider that the present case is clearly distinguishable from that case. Quite simply, the Studios are not seeking an order that BT “introduce, for all its customers, in abstracto and as a preventive measure, exclusively at the cost of that ISP and for an unlimited period, a system for filtering all electronic communications, both incoming and outgoing, passing via its services, in particular those involving the use of peer-to-peer software, in order to identify on its network the sharing of electronic files containing a musical, cinematographic or audio-visual work in respect of which the applicant claims to hold rights, and subsequently to block the transfer of such files, either at the point at which they are requested or at which they are sent”. On the contrary, the order sought by the Studios is clear and precise; it merely requires BT to implement an existing technical solution which BT already employs for a different purpose; implementing that solution is accepted by BT to be technically feasible; the cost is not suggested by BT to be excessive; and provision has been made to enable the order to be varied or discharged in the event of a future change in circumstances. In my view, the order falls well within the range of orders which was foreseeable by ISPs on the basis of section 97A, and still more Article 8(3) of the Information Society Directive. I therefore conclude that the order is one “prescribed by law” within Article 10(2) ECHR, and hence is not contrary to Article 10 ECHR.”
Also, in the BT case, it could be argued that by already having its ‘cleanfeed’ system up and running to deal with blocking access to sites identified as containing child porn images it had already potentially lost any ‘mere conduit’ defence under the e-commerce directive as doing so was a commercial decision not a legislated one.
It is also worth noting that another similar case, with an identical question to the first question in this has been referred to the Court of Justice in Case C-360/10 Belgische Vereniging van Auteurs, Componisten en Uitgevers (SABAM) v NETLOG NV.