Case C-275/15, ITV Broadcasting [No. 2] – access to cable of broadcasting services

ITV Broadcasting and other UK broadcasters claim that a company which allows people in the UK to watch via the internet, programmes which the broadcasters are showing on UK television results in the company infringing broadcaster copyright. The company denies doing anything wrong: what it is doing falls within the scope of a statutory defence in English law. The legal issue in this case turns on whether and to what extent the UK Parliament’s statutory defence still exists.

Background
TVC run a service for people in the UK who want to watch programmes being broadcast on television but who wish to watch them via internet-based live-streaming.

There are two conditions which people in the UK wishing to access this content must satisfy. First, they need they need a log-in account before they can watch the content via TVC’s website. Second, they must possess a valid ‘TV licence’. In this way, TVC ensures that its users only receive content which they were already legally entitled to receive under English law.

However, TVC’s service has led to the company experiencing repeated bouts of litigation from UK television broadcasters. The first round of litigation had already involved a preliminary reference being made to the CJEU, and now, several years later, a second reference has been made.

ITV Broadcasting [No. 1]
The first round of litigation witnessed the television broadcasters claiming that TVC was communicating protected works to the public contrary to s.20(1)(b) and s.20(1)(c) of the 1988 Copyright, Designs and Patents Act (the CDPA).

TVC denied any legal liability. First, they said they were not infringing broadcast copyright because they were not communicating works to the public. Second, they said they were not illegally ‘retransmitting’ particular qualifying services (terrestrial broadcasting channels), because what they were doing fell within the scope of statutory defences which were enshrined in English law. More specifically, what they were doing came within s.73(2)(b) and s.73(3) CDPA. Those defences also applied in respect of the alleged infringement of film copyright.

In 2011, the dispute was heard by the High Court of England and Wales. The judge decided to make a preliminary reference to the CJEU. A couple of years later, and the CJEU’s Fourth Chamber subsequently handed down its judgment in Case C-607/11, ITV Broadcasting ECLI:EU:C:2013:147.

The nub of the CJEU’s ‘ITV Broadcasting’ judgment was that the concept of communication to the public covered the retransmission of works in a terrestrial broadcast by an internet stream – even though the users of the service were within the area of reception of the terrestrial broadcast and even though the users might lawfully receive it on their television sets.

The CJEU’s judgment was then returned to the High Court of England and Wales. The national court ruled that TVC had infringed the broadcasters’ film and broadcast copyrights by streaming to members of the public in respect of: (a) ‘qualifying services’ outside the scope of s.73 CDPA; (b) ‘qualifying services’ within the meaning of s.73 but which were made to mobile devices via any mobile telephone network; and (c) streams of channels to any users situated out of the region to which the original broadcasts were made. Thus, there was infringement for streams to mobile devices via a mobile phone network.

However, the High Court also ruled that TVC was not liable for streams to the public by cable. This included streams transmitted via the internet when the final leg of the transmission took place by domestic wi-fi. The proviso being that users were in the region to which the original broadcasts were made. The court held that in those situations there was no infringement of the broadcasters’ copyright because of the statutory defence in s. 73 CDPA.

For the rest, the High Court also declared that it was not possible to interpret s.73 to be compatible with Article 5(3)(o) of Directive 2001/29. The latter provision provides that Member States may provide for exceptions or limitations to the rights provided for in Articles 2 and 3 in cases of minor importance.

Both parties appealed the rulings of the High Court of England and Wales up to the Court of Appeal, and that court has now decided to make a reference to the CJEU.

ITV Broadcasting [No. 2]
The 2015 appeal was heard by three judges, and the lead judgment was handed down by Lord Justice Kitchin, a specialist in IP law.

He could not resolve the dispute without making a reference to the CJEU. This was because of the legal uncertainty as to whether Member States were still permitted to retain a statutory provision such as s.73 CDPA, which provides a defence to liability in respect of streaming broadcasts by wire via the internet (but not via mobile phone network) and or to users in the original broadcast area.

The problem he faced was Article 9 of the EU’s InfoSoc Directive 2001/29, which provides:

Continued application of other legal provisions
This Directive shall be without prejudice to provisions concerning in particular patent rights, trade marks, design rights, utility models, topographies of semi-conductor products, type faces, conditional access, access to cable of broadcasting services, protection of national treasures, legal deposit requirements, laws on restrictive practices and unfair competition, trade secrets, security, confidentiality, data protection and privacy, access to public documents, the law of contract [emphasis added].

The bone of contention between the parties concerned the word ‘cable’. On the one hand, the broadcasters submitted that this word “cable” had a uniform and precise meaning in EU law. They said that this uniform meaning covered a dedicated cable system operated by traditional cable operators, not the internet.

Further, the broadcasters claimed that the concept of a communication to the public was limited by the cases of minor importance exception in Article 5(o) of the Directive. As a result of the ECJ’s judgment in Marleasing, the exception in s.73 CDPA should be limited to the retransmission of broadcasts on traditional cable systems operated by conventional cable programme providers.

The broadcasters’ interpretations of EU law were robustly rejected by TVC. It denied that that there was any consistent meaning in EU law as to the term “cable”. More importantly, Article 9 of the Directive had expressly saved the existing provisions of national law, including those concerning “access to cable of broadcasting services”.

Lord Justice Kitchin formed the view that the domestic pre-2003 rules were broad enough to cover internet transmissions within the statutory defence, and those rules had not been restricted to traditional cable operators.

However, he could not determine the correct scope of the phrase “access to cable of broadcasting services” in Article 9 of the EU’s InfoSoc Directive. The broadcasters were claiming that the phrase was not broad enough to encompass the “reception area” aspect of s.73. Nevertheless, TVC was pointing out that Article 9 was all about the existing provisions of national law concerning access to cable of broadcasting services – and the s.73 defence was just such a provision. Consequently, TVC was claiming that the UK was authorised to continue to retain s.73 with the scope that it had at the date of the Directive.

Lord Justice Kitchin admitted that he would make a preliminary reference on the point. That said, he would give the CJEU the benefit of his views. At para 80 of this decision, he explained:

…The “reception area” exception was introduced in the manner I have described and is strictly circumscribed. It relates only to the distribution by immediate retransmission of the broadcasts from the United Kingdom of public service broadcasters. Further, the broadcasts must have been made for reception in the area in which they are retransmitted. Moreover, this exception was introduced to facilitate retransmission of public service broadcasts in areas where reception might be poor or where for some other reason aerials could not be used. It is of course true to say that retransmissions falling within this exception are not made by cable operators under compulsion but it may be said that the exception is nonetheless one which concerns the access of broadcasting services to cable for it facilitates and regulates the immediate retransmission of these public service broadcasts by cable in areas in which the broadcasts were made for reception.

Thus, he inclined towards the position of TVC and the UK’s Secretary of State for Business, Innovation and Skills.

Lord Justice Kitchin continued by outlining the difficulty surrounding the correct interpretation of the word “cable” in the phrase “access to cable of broadcasting services” in Article 9 of the InfoSoc Directive. Although the word cable might have a settled autonomous meaning in EU law, there was still Article 9 of the Directive.

At para 82 of his decision to make a preliminary reference, he said:

…Article 9 is an unusual provision for, as its title makes clear, it is concerned with the continued application of other legal provisions, including, as all parties before us accept, existing provisions of national law. As [TVC] points out, it is therefore to be contrasted with Article 5 which is concerned with general exceptions and limitations to the rights provided for in Articles 2 and 3. Moreover and so far as relevant to this appeal, it allows Member States to retain such existing provisions which concern access to cable of broadcasting services. As I have said, I lean in favour of the view that this phrase encompasses both “must carry” and “reception area” exceptions of the kind described in s.73. That being so, it is my provisional view that it is unlikely that the European Union legislature intended by the use of the term “cable” to exclude from the scope of Article 9 provisions concerning retransmissions falling within the scope of these exceptions but which are made over the internet. I would therefore favour the conclusion that [TVC] is correct in submitting that Article 9 authorised the continued retention by the United Kingdom of s.73 with the scope it had as at the date of the directive.

He explained that if that interpretation was right, then the legal effect was this: there was no incompatibility between the InfoSoc Directive 2001/29 and s.73 in this particular appeal. Consequently, the Marleasing principle of conforming interpretation did not require him and the Court of Appeal to construe s.73 as being limited to programmes and services provided on dedicated cable networks that were being operated by conventional cable programme providers or limitation in any other way such as to exclude TVC’s services.

If that was wrong (because the CJEU would now decide that Article 9 had a narrower scope), then it was necessary to consider whether s.73 must be interpreted as being limited to the retransmission of broadcasts on traditional cable systems operated by conventional cable programme providers so as to exclude its “reception area” aspect, as the case may be.

In light of Lord Justice Kitchin’s decision, Lady Justice Arden added her own views.
She explained that the main disagreement among the three members of the Court of Appeal was on the effect of the “same area defence” to copyright infringement in s.73(2)(b) CDPA.

She did however point out that Article 9 preserved ‘a “job lot” of miscellaneous measures’ which could be implemented by member state legislation. She also agreed with Lord Justice Kitchin that Article 9 gave effect to Recital 60 of the Directive, which provides:

The protection provided under this Directive should be without prejudice to national or Community legal provisions in other areas, such as industrial property, data protection, conditional access, access to public documents, and the rule of media exploitation chronology, which may affect the protection of copyright or related rights.

She thought the effect would be that if the EU acquis meant that the word “cable” in Directive 2001/29 was a traditional cable, then it could follow that the expression “access to cable” was not primarily dealing with defences to copyright infringement. Rather, the expression could be primarily dealing with the use of cable by broadcasters – use being authorised by national law. In that context, it was pertinent that the full expression made no specific mention of copyright at all. Likewise, the Recital made no mention of copyright as such – though it did refer to other intellectual property and access to public documents. She thought that this would arguably reinforce the conclusion that its primary aim (in the context of cable) was to deal with access to infrastructure in the member states.

Lady Justice Arden went on to venture the possibility that the CJEU might give Article 9 ‘a practical construction’, such that national courts should monitor any abuse of member state rights through applying the principle of proportionality. Accordingly, any national option should then have to be proportionate with the general principle of EU law and thus establish ‘a fair balance between the rights of copyright owners, cable owners and the public interest’. Lady Justice Arden wondered whether this topic too should be relevant for the reference the Court of Appeal was making to the CJEU.

Questions Referred
According to the UK Intellectual Property Office’s website, the Court of Appeal of England and Wales has asked:

In the interpretation of Article 9 of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society (“the Directive”), specifically of the phrase This Directive shall be without prejudice in particular to “access to cable of broadcasting services”:

1. Does the quoted phrase permit the continued application of a provision of national law with the scope of ‘cable’ as defined by national law, or is the scope of this part of Article 9 determined by a meaning of ‘cable’ that is defined by EU law?

2. If ‘cable’ in Article 9 is defined by EU law, what is that meaning? In particular:
(a) Does it have a technologically specific meaning. restricted to traditional cable networks operated by conventional cable service providers?
(b) Alternatively, does it have a technologically neutral meaning which includes functionally similar services transmitted via the internet?
(c) In either case, does it include transmission of microwave energy between fixed terrestrial points?

3. Does the quoted phrase apply
(1) to provisions which require cable networks to retransmit certain broadcasts or
(2) to provisions which permit the retransmission by cable of broadcasts (a) where the retransmissions are simultaneous and limited to areas in which the broadcasts were made for reception and/or (b) where the retransmissions are of broadcasts on channels which are subject to certain public service obligations?”

4. If the scope of ‘cable’ within Article 9 is defined by national law, is the provision of national law subject to the EU principles of proportionality and fair balance between the rights of copyright owners, cable owners and the public interest?

5. Is Article 9 limited to the provisions of national law in force at the date on which the Directive was agreed, the date it entered into force or its last date for implementation, or does it also apply to subsequent provisions of national law which concern access to cable of broadcasting services?

Update – 23 August 2015
The duty of ‘conforming interpretation’ is also in the background to a recent reference from the German Supreme Court; see further, Case C-276/15, Hecht-Pharma – incensed at the competition in Frankincense-extract capsules.

Update – 24 April 2016
The Fourth Chamber is due to hear this case on 25 May 2016.

Update – 12 August 2016
The Opinion of Advocate General Saugmandsgaard Øe is due on 8 September 2016.

Update – 29 January 2016
The judgment of the Fourth Chamber is due on 1 March 2017.