Online platforms and uploading of protected works: a priori no liability for operators of online platforms

The Grand Chamber of the Court of Justice of the European Union (CJEU), in a judgment dated 22 June 2021, clarifies the liability framework of online platform operators when content protected by copyright is uploaded by platform users. This clarification is of paramount importance both for exclusive rights holders (who wish to see their works fully protected in the digital environment) and for online platform operators (who wish to avoid being held too broadly liable for conduct of users).

The European legislator is fully aware of this importance: the new Directive 2019/790 on copyright and related rights in the digital single market (the DSM Directive) expressly provides for rules on this matter. However, the judgment of the CJEU does not analyse this text: the two disputes submitted to the Court are resolved on the basis of the law applicable at the time of the facts in the main proceedings (respectively from 2008 and 2013). The directives analysed by the CJEU are therefore the Copyright in the information society Directive (2001/29), the E-Commerce Directive (2000/31) and the Enforcement Directive (2004/48).

In a previous blog on the Advocate General's Opinion in the same case (see here), the facts of the two joined cases were summarised simply by stating that a music producer (C-682/18) and a publishing group (C-683/18) consider that works protected by copyright have been uploaded without their authorisation respectively on Youtube and Uploaded.

The judgment can be summarised in three stages, each of which refers to the analysis of (a) provision(s) of one of the above-mentioned directives.

1) Copyright in the information society Directive (2001/29): do online platform operators themselves make a “communication to the public”?

The Court analysed the concept of “communication to the public” (Art. 3(1)) in the digital environment of platforms. It recalls that it implies the combination of two cumulative requirements, involving an case by case assessment according to complementary criteria.

(i) 1^st requirement: an act of communication. According to the Court, the uploading of illegal content by users on platforms is an act of communication carried out by those users (§§ 71 and 72). The platform operator is an intermediary (§ 75) whose role is, however, indispensable (§ 77). This indispensable nature could automatically lead to their intervention being qualified as an act of communication. The European judges however refuse to do so, considering that the existence of an act of communication on the part of the operators must be assessed taking into account “the importance of both the role that such intervention by the platform operator plays in the communication made by the platform user and of the deliberate nature of that intervention” (§ 80). In other words, if the operator intervenes “in full knowledge of the consequences” with the aim of giving the public access to protected works, such intervention can be classified as an act of communication. The CJEU adds that the operator contributes beyond merely making the platform available (and makes thus an act of communication) “inter alia, where:       

• that operator has specific knowledge that protected content is available illegally on its platform and refrains from expeditiously deleting it or blocking access to it,
• that operator, despite the fact that it knows or ought to know, in a general sense, that users of its platform are making protected content available to the public illegally via its platform, refrains from putting in place the appropriate technological measures that can be expected from a reasonably diligent operator in its situation in order to counter credibly and effectively copyright infringements on that platform,
• that operator participates in selecting protected content illegally communicated to the public, provides tools on its platform specifically intended for the illegal sharing of such content or knowingly promotes such sharing, which may be attested by the fact that that operator has adopted a financial model that encourages users of its platform illegally to communicate protected content to the public via that platform” (§ 102).

(ii) 2^nd requirement: a communication to a public. Briefly, the CJEU states that “it is only when a user of the platform decides to make uploaded content available to the ‘public’ that that user and, consequently, the operator of the platform used as an intermediary may make a ‘communication to the public’” (§ 100).

2) E-Commerce Directive: can online platform operators benefit from a liability exemption?

Article 14(1) of the E-Commerce Directive exempts intermediary service providers that store illegal content, provided that they were unaware of its illegal nature. The provider has to play a neutral role (§ 106), i.e. a role that is purely technical, automatic and passive (§ 105). A contrario, there is no exemption when they play an active role, contributing beyond merely making the platform available, to give the public access to protected content (§ 107).

According to the CJEU, an operator that implements technical measures to detect illegal content (§ 109) or who offers users video search and recommendation functions (§ 114) does not automatically play such active role. However, this is the case when the operator becomes aware of illegal content through an examination carried out on its own initiative or when it is notified with sufficient information to enable it “to ascertain, without detailed legal examination, whether the content is illegal [...] and whether its removal is compatible with freedom of expression” (§ 116).

3) IP Enforcement Directive: can a Court injunction against online platform operators be made conditional?

The court assesses the compatibility of the German “interferer liability” framework with the European law on the possibility for a copyright holder to obtain an injunction against a platform operator (Art. 8(3)). The framework allows the intermediary, considered as an interferer (without being the perpetrator of or a participant in that infringement), to be sued for an injunction, provided that the infringement has been notified to him beforehand and that the infringement has not ceased. The Court validates this mechanism and its specific conditions. It states that such a mechanism can however not unnecessarily delay the effective cessation of the infringement, thereby causing a disproportionate damage to the rights holder (§ 141).

Conclusion

The decision is a further step in the liability regime for online platform operators. It reflects a proportionate balance between the various interests at stake. However, there is every reason to believe that the judgment handed down on 22 June 2021 may only have a limited scope. Indeed, Directive 2019/790 (the transposition of which is still pending in Belgium) and its Article 17 introduce a new legal framework for the liability of online platform operators, requiring them to obtain the prior authorisation from right holders. Moreover, the exemption from liability is no longer applicable to them. It is unfortunate that the Court did not take this brand new framework into account in order to already shed some light on it, as well as on the applicable liability rules governing online platform operators. We will come back soon, in a new blog, on this provision with multiple issues and its final transposition into Belgian law.

This article was co-authored by Edouard Cruysmans in his capacity of Professional Support Lawyer at Stibbe.