At the end of March, the EU Council took a step forward and issued a compromise proposal on the entire Directive. Almost at the same time, a revised version of the European Parliament’s position as drafted by rapporteur Axel Voss was “leaked”. Both papers appear to suggest a common effort to reach a proposed final text before long, to allow the legislative process to proceed.
Which platform operators are affected?
Both of the currently debated versions restrict the scope of application as the circle of affected service providers is narrowed down. According to Article 2(5) of the Council’s draft, an “online content sharing service provider” should now be defined as:
“a provider of an information society service whose main or one of the main purposes is to store and give the public access to a large amount of works or other subject-matter uploaded by its users which it organizes and promotes for profit-making purposes“.
Several exceptions are also planned, including for non-profit online encyclopedias (such as Wikipedia), online marketplaces and Internet access service providers. Axel Voss does however not (yet) list the latter exception.
Communication to the public
It remains very controversial whether the act of communication to the public by such service providers should or should not be one of the core elements of Article 13 of the draft Directive. Nowadays, many services are organized in such a way that it is the user himself that carries out the act of communication, not the platform operator. In consequence, this is a crucial question to establish the scope of the provision.
Both versions now under discussion envisage the concept of an act of communication to the public (“CTTP“) by these service providers. Article 13(1) of the Council’s text uses the language from copyright case law of the European Court of Justice, and in particular The Pirate Bay case (C-610/15), stating that the service provider performs an act of communication to the public when “it intervenes in full knowledge of the consequences of its action to give the public access to works or other subject matter uploaded by its users” .
Moreover, the provider is also:
“deemed to intervene in full knowledge of the consequences of its action when it has received information from right holders on the specific works or other subject matter which it gives access to on its website ” (Article 13(2)).
Axel Voss‘ text is less specific here, and essentially emphasizes the importance of the active role of the service provider (Recital 38).
Article 13(3) of the Council’s draft clarifies that an online content sharing service provider who carries out an act of CTTP while providing its services cannot invoke the safe harbor from liability under Article 14 of the eCommerce Directive 2000/31. This could be regarded as a mere clarification with hosting activities remaining within the Article 14 safe harbour but with providers performing an act of communication themselves falling outside it.
Service providers’ obligations The actual obligations of online content sharing service providers can be found in Article 13(4) of the Council’s draft. In addition to a mere notice-and-take-down mechanism, the affected service providers should take “implementing effective measures to prevent” the availability of illegal works on their platform. The question of what measures are considered reasonable is then answered in Article 13(5).
The Council’s version provides a series of factors to be used for this assessment, including “the nature and size of the services, including their audience“, “the amount and the type of works or other subject-matter uploaded by the users of the services” and “the availability and costs of the measures as well as their effectiveness in light of technological developments“.
The Parliament’s text is much less detailed on this point and merely refers to “appropriate and proportionate technical measures leading to the non-availability of copyright and related-right infringing works or other subject-matter on their services“.
Both texts provide for right holders to receive adequate information regarding the use and functioning of the implemented measures, and the establishment of complaints and redress mechanisms.
The EU institutions’ positions appear to be converging on the provisions of the controversial Article 13. It is to be appreciated that only service providers that actually perform an act of CTTP themselves will be subject to the new obligations and the exclusion from safe harbour. In this respect, a clear and unambiguous understanding of what that act consists of is crucial. Building on the case law of the European Court of Justice is a good approach, but it is far from clear how the Council’s draft compromise can be reconciled with the CJEU’s case law on both CTTP and with its case law on the E-Commerce Directive Art. 14 safe harbor.
Finally, it should be mentioned that the European Parliament’s Committee on Legal Affairs (JURI) also expressed comments on a number of other articles of the draft Directive in separately “leaked” paper. These are on the agenda for the next session of the European Parliament’s Legal Affairs Committee (JURI) on 23 and 24 April 2018.
DSM Watch will be back with a further update after the JURI committee has voted.
Authored by Alastair Shaw and Nils Rauer
For further information on the Digital Single Market and its practical impact, please visit our website www.dsmwatch.com.