• Another Reference for a Preliminary Ruling by A Belgian Court in a Dispute on ISP Liability
  • November 1, 2010 | Author: Karel Janssens
  • Law Firm: Crowell & Moring - Brussels Office
  • In a dispute between the Belgian copyright collecting society SABAM versus the online social network platform NETLOG, the Brussels Court of First Instance requested a preliminary ruling from the European Court of Justice. The reference to the European Court is very similar to the earlier one in the Scarlet/SABAM case, with that difference that NETLOG acts as a hosting provider and not as an access provider. The question to be answered by the European Court of Justice is whether a hosting provider can be obliged to implement, as a preventive measure, at its expense and for an unlimited period, a filtering system and subsequently to block the transfer of illegal files. These references represent an important step in the debate on the balance that needs to be found between the rights of owners of intellectual property rights, those of internet intermediaries, and, last but not least, the privacy and fundamental rights and freedoms of consumers.

    Background

    On the 28th of June 2010, the Brussels Court of First Instance referred a preliminary ruling to the European Court of Justicein the dispute between SABAM, the Belgian copyright collecting society, and NETLOG, a social network platform.  According to SABAM, NETLOG’s platform allows its users to illegally upload works from SABAM’s repertoire and thereby infringe the right holders’ copyrights.  SABAM initiated cease and desist proceedings against NETLOG on the basis of Article 87 §1 Copyright Act. 

    According to the Brussels Court of First Instance, imposing an injunction on NETLOG as a hosting provider “to cease the copyright infringements by its users” could result in an order to install a filtering system for its entire clientele, in abstracto and as a preventive measure, at its own expense and without any limitation in time, and to block the exchange of illegal files.  Not only does this raise the question whether such order can qualify as a general monitoring obligation by NETLOG, which would be contrary to article 15 of Directive 2000/31, but it also raises the issue of proportionality.

    Reference for a preliminary ruling

    The Court referred to the Scarlet/Sabam case in which a similar question was raised, with the difference that NETLOG acts as a hosting provider and Scarlet acts as an access provider.  The reference made to the CJEU is therefore very similar to the reference made in the Scarlet/SABAM case and is as follows:

    "Do the Directives 2001/29 and 2004/48, read together with Directives 95/46, 2000/31 and 2002/58 and interpreted in light of the articles 8 and 10 of the European Convention for the Protection of Human Rights and Fundamental Freedoms, offer the possibility to the Member States to allow a national judge to, in the framework of proceedings on the merits and based upon one single legal provision that states that "They [the national judges] can also issue an injunction against intermediaries whose services are being used by third parties to infringe copyrights or neighboring rights", order a hosting provider to install a system for its entire clientele, in abstracto and as a preventive measure, at its own expense and without any limitation in time, that filters the largest part of the information stored on its servers, for the identification of electronic files on its servers, that contain musical, cinematographic or audiovisual works of which SABAM claims to hold certain rights, and subsequently block the exchange of these files?"

    Assessment

    Both the Scarlet/SABAM case and the SABAM/NETLOG case raise the question  on  how much of the operational and financial burden of the fight against piracy can be put on internet intermediaries, be it access providers or hosting providers. 

    The recent references represent an important step in the debate on the balance that needs to be found between the rights of owners of intellectual property rights on the one hand, those of internet intermediaries on the other hand, and the privacy and fundamental rights and freedoms of consumers.  

    Although these are both Belgian cases, the Scarlet/SABAM and SABAM/NETLOG proceedings are being closely watched by the record and music industry, internet access providers and other online intermediaries throughout the world  because of its potentially far-reaching implications for their businesses.  The European Court of Justice is expected to hear these cases in approximately 1,5 year.