On 3 June 2016, the Court of Appeal of Brussels (the
"Court") denied the Belgian Association for Authors,
Composers and Publishers ("SABAM") the right to collect
remuneration for communication to the public from internet service
The dispute arose in 2011 after SABAM informed Belgian ISPs that
a 3.4% fee would be charged on the total price paid annually by
internet users to ISPs for their internet subscription. SABAM
contended that, since ISPs offer access to the Internet, including
copyrighted materials, ISPs were "communicating these
materials to the public" within the meaning of Article XI.165
of the Code of Economic Law ((Wetboek Economisch Recht/ Code de
Droit Economique – the "Law"). Because such
communication was occurring without the authors' consent and
since ISPs were generating income therefrom, SABAM alleged that it
was entitled to collect remuneration from ISPs on the basis of
Article XI.165, paragraph 1.4, of the Law.
Both the Belgian Ministry of Economy and ISPs challenged this
measure before the President of the Court of First Instance of
Brussels (Rechtbank van Eerste Aanleg / Tribunal de
Première Instance) (the "CFI") who ruled in
their favour (See VBB on Belgian Business Law, Volume 2015, No.
3, p. 14 and 15,available atwww.vbb.com). In its decision, the CFI carefully
examined the exact role played by ISPs in the communication process
and concluded that the ISPs' intervention was not subject to
copyright since ISPs merely enabled the "original
communication" by providing equipment but did not make a
second communication to the public. Hence, the CFI stated that ISPs
were not a component of the communication process but
intermediaries indispensable to the functioning of the
Unfortunately, this issue was completely overlooked by the Court
who dismissed SABAM's appeal exclusively on the grounds that
SABAM was not authorised, by law or any other means, to collect
such remuneration from ISPs.
The Court first recalled that Article XI.165, paragraph 1.4, of
the Law only grants authors an exclusive right to communicate their
works to the general public. The provision remains silent as to the
authors' right to collect any remuneration from third parties
where they authorised such communication. Hence, the Court found
that Article XI.165, paragraph 1.4, of the Law could not serve as a
legal basis for the disputed remuneration.
In the absence of a legal basis, the Court went on to state that
SABAM is not an administrative authority and, as a result, is not
authorised to establish administrative fees/charges on third
The Court therefore assessed whether there was any contractual
basis to the remuneration that SABAM intended to collect from ISPs.
Given the principle of freedom of contract, i.e. the right
to refuse to contract, and the absence of any legal obligation to
contract with SABAM, the Court held that SABAM was in no position
to force ISPs to enter into a contract with it.
As a consequence, the Court decided that the remuneration that
SABAM intended to collect from ISPs had to be withdrawn.
SABAM is currently considering whether to appeal the Court's
decision before the Belgian Supreme Court (Hof van
Cassatie/Cour de Cassation). In a press release, SABAM pointed
out that the Court ignored the key issue discussed in first
instance of whether ISPs communicate works to the public within the
meaning of the Law. During the proceedings before the Court, SABAM
and ISP Proximus had suggested that questions for a preliminary
ruling be referred to the EU Court of Justice in that respect. The
EU Court of Justice already ruled on communication to the public
for satellite package providers (See VBB on Belgian Business
Law, Volume 2011, No. 10, p.13,available atwww.vbb.com) and broadcasters (See VBB on Belgian
Business Law, Volume 2015, No. 11, p.14,available atwww.vbb.com) but not yet for ISPs, whose service and
technical communication is different. Unfortunately, the Court
declined the request to refer a preliminary question to the EU
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