The ECJ has held that an order imposed by a Belgian court, which required an internet service provider ("ISP") to filter and block access by its customers to files containing infringing copies of musical works, was incompatible with EU law. (Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL, Case C-70/10, 24 November 2011.)
The case concerned questions referred by the Brussels Court of Appeal to the ECJ regarding Scarlet, an ISP. Scarlet was ordered by a Belgian court to make it impossible for its customers to share files that infringe rights held by members of SABAM, the Belgian Society of Authors, Composers and Publishers.
In 2004, SABAM established that users of Scarlet's services were downloading works in SABAM's catalogue from the Internet, without authorisation and without paying royalties, by means of peer-to-peer networks (a transparent method of file sharing which is independent, decentralised and features advanced search and download functions).
Upon application by SABAM, the President of the Brussels Court of First Instance ordered Scarlet, in its capacity as an ISP, to bring those copyright infringements to an end by making it impossible for its customers to send or receive in any way electronic files containing a musical work in SABAM's repertoire by means of peer-to-peer software.
On appeal to the ECJ, it held that EU law precludes the imposition of an injunction by a national court which requires an ISP to install a filtering system with a view to preventing the illegal downloading of files. It concluded that such an injunction does not comply with the prohibition on imposing a general monitoring obligation on such a provider. The filtering system would mean that the ISP was required to monitor data relating to its customers, which is explicitly prohibited by Art 15 of the E-Commerce Directive.
The ECJ also ruled that the injunction did not comply with the requirement to strike a fair balance between, on the one hand, the right to intellectual property, and, on the other, the freedom to conduct business, the right to protection of personal data and the freedom to receive or impart information – fundamental rights safeguarded by the Charter of Fundamental Rights of the EU.
The case follows an earlier UK ruling where BT became the first ISP to be forced by a court order to block its customers from accessing a website on grounds of copyright infringement. The site in question, www.newzbin.com, allowed users to share data files, predominantly pirate films, TV show downloads and music. The case was brought by six major film studios.
Scarlet was held distinguishable in that the film studios were not asking for an unlimited filtering system for all customers, but rather for a clear and precise injunction requiring BT to implement an existing technical solution which BT itself had accepted would be technically feasible and the costs would not be excessive. Therefore, it was not in breach of Article 10 of the European Convention of Human Rights.
It is clear the scope of the injunction sought and the technical feasibility of achieving it will be relevant in each case. This also does not bode well for any orders which the Secretary of State may make under the Digital Economy Act (DEA), as any such orders to prevent unlawful file sharing may be unenforceable under EU law for similar reasons.
The online infringement provisions of the DEA oblige ISPs to assist in identifying copyright infringers and allow enhanced measures to be taken against copyright infringers, including an ability to require ISPs to suspend internet connection to persistent offenders. Following a recent Judicial Review (JR) by BT and Talk Talk, the High Court has held that the provisions of the DEA are compatible with EU law; so, whilst copyright owners and the government are relieved by the JR decision, the issue still very much remains open in light of Scarlet.
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