On 4 June, just one working day before the deadline for transposition of the Directive on Copyright in the Digital Single Market (EU) 2019/790) (Directive), the Commission released its long-awaited guidance document (Guidance) on the application of Article 17 of the Directive.
One of the most controversial provisions in the Directive, Article 17 alters the existing content management and liability rules for online content-sharing service providers (OCSSPs). These are information society service providers who, as one of their main purposes, store and enable users to upload and share a large amount of copyright-protected content which the provider organises and promotes for the purpose of obtaining profit, such as YouTube.
Article 17 makes an OCSSP responsible for instances of copyright infringement committed by their users in respect of a copyright-protected work, unless it demonstrates that it (a) made best efforts to obtain a prior authorisation from the rights holder, (b) made best efforts to ensure the unavailability of the work if the rightsholder had given them enough information about the work, and (c) removed it expeditiously upon being notified by the rights holder and made best efforts to prevent future uploads of the work. Unsurprisingly, this new regime has generated much debate, with many OCSSPs concerned about vagueness in elements of the wording and the additional burden that Article 17 is likely to involve.
In this context, it was hoped that the Guidance, although non-binding, would provide much-needed clarity, particularly given that Member States had to transpose the Directive into national law by 7 June 2021.
Below, we have summarised some key updates contained in the Guidance:
"Best Efforts" Provisions
The "best efforts" requirement under Article 17(4) is one of the most contentious elements of the Directive. The Guidance clarifies that "best efforts" is an "autonomous notion" of EU law and should be transposed by the Member States in accordance with the Guidance and interpreted in light of the aims and objectives of Article 17. In assessing whether such obligations have been complied with, the Guidance states that the proportionality principle under Article 17(5) should be considered.
In what will be a disappointment to many stakeholders, the Guidance states that the obligation of "best efforts" to obtain authorisation of rightholders under 17(4)(a) requires a "case-by-case" assessment of the actions undertaken by OCSSPs. However, the Guidance advises that "best efforts" should involve OCSSPs at a minimum, engaging proactively with rightholders who can be easily identified and located, notably those representing a broad catalogue of works or other subject matter (i.e. Collection Management Organisations (CMOs)). To facilitate this, the Guidance provides that Member States "may encourage the development of registries of rightholders that could be consulted by online content-sharing service providers".
Under Article 17(4)(b), "best efforts" are only to be made to ensure the unavailability of specific works and other subject matter for which rightholders have provided OCSSPs with the "relevant and necessary information". Again, the Guidance is ambivalent on this point, stating that such relevant and necessary information is to be assessed on a "case-by-case" basis. While this provision seemingly implies the use of automated blocking systems to prevent infringing uploads, what will be of some relief to OCSSPs is the clarification that Member States should not mandate the use of a technological solution or impose any specific technological solutions on OCSSPs in order to demonstrate best efforts in this regard.
Upping the (ex)-Ante?
The tension between the "best efforts" obligations of Article 17(4) and Article 17(7) has received much attention. This requires platforms to ensure that works that do not infringe copyright are not blocked. Helpfully, the Guidance clarifies that in order to comply with Article 17(7) and leave legitimate uses unaffected, automated blocking (preventing the upload of infringing content ex-ante) should in principle, be limited to "manifestly infringing uploads".
However, the Guidance also appears to recommend ex-ante blocking and filtering of content "which could cause significant economic harm to rightholders". This refers to time-sensitive content such as unreleased films and music. In such instances, rightholders may earmark the content so that particular care and diligence is applied in employing "best efforts". Where possible and practicable, the Guidance suggests a rapid ex-ante human review by OCSSPs of the uploads containing the earmarked content, identified by an automated content recognition tool.
Given the novelty of this addition, it is not yet clear how it will work in practice. It may give rise to the increased risk of over-blocking of legitimate content.
Stakeholder reaction to the Guidance, while still emerging, has so far been tepid, with criticism of hesitancy and lack of clear instruction from the Commission.
Article 17 remains the subject of challenge before the Court of Justice of the European Union (CJEU) (Republic of Poland v European Parliament and Council of the European Union (Case C-401/19)). Poland has requested the CJEU to annul Article 17(4) on the basis that it undermines "the essence of the right to freedom of expression and information" and consequently violates Article 11 of the Charter of Fundamental Rights of the European Union.
The Advocate-General's Opinion is expected on 15 July, and the CJEU judgment will follow some-time later. This decision may lead to updated Commission guidance depending on the outcome of the case.
Like many Member States, Ireland has not yet transposed the Directive into national law and has missed the 7 June 2021 deadline. The Department of Enterprise, Trade and Employment (DETE) has confirmed that the Directive will be implemented by way of secondary legislation and it anticipates that a Regulation will be signed shortly.
We will continue to monitor future updates from DETE, the Commission and the CJEU and keep you updated.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.