SABAM: A Turning Point in EU Internet Law?

One of the most striking - and disturbing - trends of recent years has been the assumption by the copyright industries that protecting their intellectual monopolies outweighs the rights of the public. This can be clearly seen in the French...

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One of the most striking – and disturbing – trends of recent years has been the assumption by the copyright industries that protecting their intellectual monopolies outweighs the rights of the public.

This can be clearly seen in the French HADOPI and British Digital Economy Act, where the identities of alleged file-sharers may be handed over by ISPs simply upon accusation by the copyright holders – no court orders required. "Innocent until proven guilty" goes out of the window simply because the music and film industries have resisted keeping up with the changes that the Internet has brought to practically every sector. They seem to regard themselves as exempt from the march of progress, and deserving of special laws that protect their old business models based on assumptions that no longer hold.

Similarly, HADOPI's ability to cut people off after an arbitrary number of such accusations is a clear breach of basic human rights – not so much to the Internet, but to the things for which it is now indispensable in Western society: access to government, education, business etc. It is the modern equivalent of taking away someone's electricity or water supply: it is punitive rather than proportionate, and a collective punishment of everyone living at a given address.

Another area where the copyright industries are trying to override basic rights is privacy: increasingly there are demands for ISPs to monitor everything in their customers' IP stream to search for potential infringing uses of copyright materials – effectively turning the ISPs into a private police.

One of the most strident in their demands for this kind of total surveillance is the Société belge des auteurs, compositeurs et éditeurs (SABAM). It seems to have no sense of what is reasonable, like many such collection societies. Recall the UK case where a hairdresser was fined £1500 for playing the radio in his shop because he only had paid one of two licences that he needed for this, or the music retailers who are forced to take out a licence for playing music they are trying to sell for the benefit of musicians.

Here's the background to SABAM's demands [.pdf]:

This case has its origin in a dispute between Scarlet Extended SA, an internet service provider, and SABAM, a Belgian management company which is responsible for authorising the use by third parties of the musical works of authors, composers and editors.

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 Tribunal de première instance de Bruxelles (Brussels Court of First Instance, Belgium) ordered Scarlet, in its capacity as an internet service provider, on pain of a periodic penalty, 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.

Scarlet appealed to the Cour d'appel de Bruxelles (Brussels Court of Appeal), claiming that the injunction failed to comply with EU law because it imposed on Scarlet, de facto, a general obligation to monitor communications on its network, something which was incompatible with the Directive on electronic commerce1 and with fundamental rights. In that context, the Cour d'appel asks the Court of Justice whether EU law permits Member States to authorise a national court to order an internet service provider to install, on a general basis, as a preventive measure, exclusively at its expense and for an unlimited period.

As can be seen from this, the demand was extraordinary: that all P2P traffic be monitored, checked and the potentially infringing traffic blocked. Leaving aside whether it would even be possible technically to carry out such an inspection and blocking in real time, it is clearly a vast assault on the public's privacy online.

Fortunately, the European Court of Justice agrees:

In its judgment delivered today, the Court points out, first of all, that holders of intellectual-property rights may apply for an injunction against intermediaries, such as internet service providers, whose services are being used by a third party to infringe their rights. The rules for the operation of injunctions are a matter for national law. However, those national rules must respect the limitations arising from European Union law, such as, in particular, the prohibition laid down in the E-Commerce Directive on electronic commerce under which national authorities must not adopt measures which would require an internet service provider to carry out general monitoring of the information that it transmits on its network.

In this regard, the Court finds that the injunction in question would require Scarlet to actively monitor all the data relating to each of its customers in order to prevent any infringement of intellectual-property rights. It follows that the injunction would impose general monitoring, something which is incompatible with the E-Commerce Directive. Moreover, such an injunction would not respect the applicable fundamental rights.

It is true that the protection of the right to intellectual property is enshrined in the Charter of Fundamental Rights of the EU. There is, however, nothing whatsoever in the wording of the Charter or in the Court's case-law to suggest that that right is inviolable and must for that reason be absolutely protected.

In the present case, the injunction requiring the installation of a filtering system involves monitoring, in the interests of copyright holders, all electronic communications made through the network of the internet service provider concerned. That monitoring, moreover, is not limited in time. Such an injunction would thus result in a serious infringement of Scarlet's freedom to conduct its business as it would require Scarlet to install a complicated, costly, permanent computer system at its own expense.

What is more, the effects of the injunction would not be limited to Scarlet, as the filtering system would also be liable to infringe the fundamental rights of its customers, namely their right to protection of their personal data and their right to receive or impart information, which are rights safeguarded by the Charter of Fundamental Rights of the EU. It is common ground, first, that the injunction would involve a systematic analysis of all content and the collection and identification of users' IP addresses from which unlawful content on the network is sent. Those addresses are protected personal data. Secondly, the injunction could potentially undermine freedom of information since that system might not distinguish adequately between unlawful content and lawful content, with the result that its introduction could lead to the blocking of lawful communications.

Consequently, the Court finds that, in adopting the injunction requiring Scarlet to install such a filtering system, the national court would not be respecting the requirement that a fair balance be struck between the right to intellectual property, on the one hand, and the freedom to conduct business, the right to protection of personal data and the right to receive or impart information, on the other.

Accordingly, the Court's reply is that EU law precludes an injunction made against an internet service provider requiring it to install a system for filtering all electronic communications passing via its services which applies indiscriminately to all its customers, as a preventive measure, exclusively at its expense, and for an unlimited period.

I've quoted from the Court's press release at length because it's clear that this is one of the most important decisions ever handed down by a top court in Europe regarding the Internet, intellectual monopolies and privacy. As such, it will probably have a huge impact not just on future EU legislation, but in terms of how existing legislation around Europe is implemented.

There are two main points to bear in mind. The first is the key section that states: "It is true that the protection of the right to intellectual property is enshrined in the Charter of Fundamental Rights of the EU. There is, however, nothing whatsoever in the wording of the Charter or in the Court's case-law to suggest that that right is inviolable and must for that reason be absolutely protected." This basically undercuts the entire argument of the copyright industries that they have a "right" to expect governments to bring in pretty much any legislation in order to protect their intellectual monopolies. As the court notes, there is nothing to suggest their right to those monopolies is "inviolable."

However, this does not mean that Internet filtering can never be applied in the EU. The court's judgment is very clear: such a system cannot be imposed on an ISP when it applies "indiscriminately to all its customers, as a preventive measure, exclusively at its expense, and for an unlimited period."

That suggests to me (but IANAL) that if such a system were limited in time and scope, it might well be allowed. I predict that the copyright industries will be exploring just how limited they need to be in their demands in order to get around what is a huge setback for one of their main strategies.

I also expect that as a result, they will move more towards the Newzbin2 model of individual site blocking:

On October 26, Justice Arnold at the High Court handed down a written judgment to BT, one of the UK's largest Internet service providers, which ordered the company to block subscriber access to Newzbin2 within two weeks.

The decision came after BT failed in their opposition to the blockade of Newzbin2 which had been ordered after several Hollywood studios applied for an injunction against the site on copyright infringement grounds.

With several days to go before the deadline expires, according to Mr White at Newzbin2, BT appear to have implemented the blockade.

However, as the TorrentFreak article notes, even that can be circumvented:

In typically defiant mood, Mr White added that the blockade would have very little impact.

"Downloads of our BT Cleanfeed busting client that will allow anyone to access our site despite the block have been stratospheric over the past couple of weeks," he reports.

The apparent take up of the software has been impressive. Just over 93% of Newzbin2€²s active BT users are reported to have downloaded the anti-censorship software, leading to what Mr White describes as "replete failure" for the MPA.

Clearly, the cat-and-mouse game is destined to continue for a while. But irrespective of what the future holds in that regard, today's SABAM decision will nonetheless go down as an important moment when the claim by the copyright industries that the protection of intellectual monopolies justified any intrusive and oppressive law was finally refuted.

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